123 Essay

In: Business and Management

Submitted By mengyao
Words 840
Pages 4
One of the most influential economists in twentieth century-John Kenneth Galbraith asserted that there are two forms of wants exit in consumer demand. First is the individual’s want that never going to be reduced, although it always satisfied. Like a man is physically satisfied by fulfilling his stomach by eating food, but then he may want to watch TV to relax after finishing eating. The other form of consumer demand is that the consumer role that human plays. Human in this role always want to buy production to satisfy themselves. However, the two forms of wants will not exist as the modern advertising and salesman were brought into the economy, which brings in the theory of Galbraith-“The Dependence Effect”. He expounded that “As a society becomes increasingly affluent, wants are increasingly created by the process by which they are satisfied” (Galbraith, John Kenneth, p. 293). He thought that advertising manipulates human’s needs and create artificial needs for people, or in other words, modern advertising is used not for serving human’s needs purpose, but for creating new demands for them. For example, fancy jewelry always appears on the TV screen. The shinning appearances of the jewelry with the romantic background music, advertisers utilize the perfect visual effect and auditory effect to introduce how perfect their product is, so that attract consumers to buy it. Do people really need jewelry? The answer would be no. The need that people have on jewelry is because of the advertising effect. The advertising makes people think that they need the jewelry for beauty purpose of date purpose. Galbraith's theory of consumer demand also has an important policy implication: “The inherent tendency will always be for public services to fall behind private production” (Galbraith, John Kenneth, p. 293). Galbraith called this circumstance "social imbalance." The…...

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