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Lecture

ETHC 3P82 Lecture Notes - Tobacco Advertising, Surgeon General Of The United States, Counterexample


Department
Ethics
Course Code
ETHC 3P82
Professor
Thomas Mulligan

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Monday, March 15 - Marketing, Advertising, and Ethics
Galbraith and Hayek on the Dependence Effect
KEY CONCEPTS
NON SEQUITUR
oargument
opremises
oconclusion
LIBERAL POLITICAL ECONOMY (Galbraith)
vs.
CONSERVATIVE POLITICAL ECONOMY (von Hayek)
AFFLUENCE
ORIGINAL WANTS
oinnate (born with)
vs.
NON-ORIGINAL WANTS
osynthesized by (a) emulation and (b) advertising/salesmanship
PRODUCTION
THE DEPENDENCE EFFECT
JOHN KENNETH GALBRAITH ( 1908 – 2006)
31 books, 45 honorary degrees
born in Iona Station, Ontario
1937 - U.S. citizenship
professor, Princeton & Harvard
presidential advisor, ambassador
1997 - Order of Canada
2000 - U.S. Medal of Freedom
"The Dependence Effect" ( Honest Work , 313)
Part I of the argument:
Current theory of consumer demand: there is never a point where human
has no wants – once wants are being satisfied new wants come up (first
physical, then psychological); wants originate in individuals’ personalities
( psychology)
There are original wants (innate, born) which are most natural and most
urgent physical wants
Allegory: If we just wake up in the morning assailed by demons who
demand certain things and have certain wants, there is good reason to
satisfy the wants – however, if the demons are created and cultivated by
us/society first, the wants might not be reasonable at all
In society: Production fills a void which it has itself created production
creates wants in people in then satisfies them

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Modern advertising and salesmanship have the central function to create
desires; are the demons
‘A broad empirical relationship exists between what is spent on production
of consumers’ goods and what is spent in synthesizing the desires for that
production The more money is spent on production, the more money is
spent on advertising in return
THESIS: Production itself creates the wants it seek to satisfy =
DEPENDENCE EFFECT
WANTS PRODUCTION
1) Innate/original/born wants (shelter, food, clothes, sex)
2) 2)Wants inspire us to create the means of production (grow food, hunt,
create shelter) and to develop skills
3) Production satisfies these original wants
4) Economy grows
5) Original wants are all satisfied, contrived/synthesized/not born with
wants take over
6) Production now suggests new wants which it seeks to satisfy (e.g.
Fashion, not merely clothes)
Most social/economic energy spent on synthesized wants money
given to production that, in return, spents money in order to synthesize new
wants
How production creates wants: Passively through emulation; actively
through advertising and related activities
= DEPENDENCE EFFECT
The mere fact that wants can be synthesized by advertising, catalysed by
salesmanship, and shaped by manipulation of the persuaders shows that
they cannot be urgend (e.g. hunger does not have to be synthesized; it is
there)
This is possible because all physical wants are satisfied; in this state
people are open to persuasion as society becomes increasingly affluent,
wants are increasingly created by the process by which they are satisfied
Part II of the argument:
Final problem of affluent society is what kind of products it produces and
how wealth is distributed
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