Life lessons from an ad man

Aside from being humourous and very entertaining, this talk does a great job of illustrating a basic economic principle: value is subjective.
Value comes from the usage or consumption, not from production: “Pearls are not valuable because men dive for them, but men dive for them because they are valuable.”
Also, marketing can influence beliefs and perceived value (the segment on Diamond Shreddies is hilarious).

The second important point is that there are many dimensions underlying subjective value and personal preferences. Emotions and morale values are often stronger than monetary rewards or punishments.
Behavioral economists are curious about this sort of things, but they actually don’t much impact economic theory overall. All that matters is that people have different preferences.

Finally, it illustrates that markets find ways to fulfill needs. It is incorrect to think that consumers are victims of producers. Actually, producers have to work hard to discover and match consumer desires, to make them happy.
If you think ads are banal, blame the consumers.


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