Half Sigma – a regular, and regularly thoughtful, commentor
at Café Hayek – offers this observation today in a comment on this post:
We live in a marketing economy, and companies prosper not by
having better products, but by creating the PERCEPTION that they have better
This allegation is widely believed. And while it would be foolish to deny that some
companies sometimes try to deceive consumers about the quality of their
products – and equally foolish to deny that some consumers sometimes fall for
these deceptions – Half Sigma’s comment is whoppingly at odds with reality.
If Half Sigma’s claim were correct, then the quality of
products widely available today would be little changed from that of products
widely available in the past.
Indeed, if this claim were true, the quality of today’s
products might well be worse than product quality in the past. If companies can succeed through marketing to
fool people consistently into believing that today’s product is better than
yesterday’s product when, in fact, today’s product is no better than yesterday’s
product, then surely companies can succeed through marketing to fool people
consistently into believing that today’s product is better than yesterday’s
product when, in fact, today’s product is worse than yesterday’s product.
But no matter, for reality is replete with products whose
quality is today obviously higher than in the past. Automobiles, televisions, audio equipment, telephones
(including cell-phones), computers, sporting equipment, gas grills, carpentry
tools, cookware, contact lenses, movie theaters, digital cameras, computer
software, .… the list is long. Even the
quality of wine corkage is slowly but surely improving.
Am I mistaken? Am I
so utterly duped by the wizards of Madison Avenue that I only think that the
goods listed above (and countless others) are today of generally higher quality than they were a few
years ago? Am I merely fooled, for example, into thinking that having to bring my car in for a tune-up every 100,000 miles is better than having to bring it in for a tune-up every 20,000 miles?