Sunday, August 20, 2006

Are consumers just victims?

Do you make your own buying decisions? Well known economist J. K. Galbraith said we don't. Rather, as he wrote in 1967, we are controlled by corporations:
The mature corporation had readily at hand the means for controlling the prices at which it sells as well as those at which it buys. ... The proper shape of an automobile, for most people, will be what the automobile makers decree the current shape to be.
Most consumers seem to have more free will than Galbraith imagined: Many consumers looked at the "proper shape of an automobile," as decried by Galbraith, and chose Toyota, Honda, and Nissan instead. Consequently, Ford just unveiled a 21% cut in its production. General motors has half the market share it did when Galbraith wrote about its control and it is still struggling financially.

Some, like J. K. Galbraith, are certain that people's lives are run by forces outside of their control. Others believe that they are firmly in control. The human mind is not good at separating reality from anxieties.

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