Vhati here. Since this is my first post, I guess I should begin in the spirit of bloggers everywhere: uninformed demagoguery!
Disclaimer: I have only trivial understanding of economics and human nature. Don’t do what I say unless it is consistent, logical, and supported by outside evidence you accept.
Premise: Value is set when sellers collectively propose a range, and buyers collectively accept amounts from that range.
Premise: Buyers lack knowledge of most products they buy.
Since buyers are ignorant, they have to buy each competing product through trial-and-error, in an order determined by hearsay or peceived seller reputation, until satisfied with one.
A buyer is satisfied when a product’s performance (or one’s funding) is sufficient to preclude further shopping.
Manipulation of hearsay and reputation is called “marketing”.
Within a large enough area, a seller can profit largely via marketing to attract trial purchases. (See Pet Rock and Beanie Baby)
When customers have a poor grasp of performance metrics (or simply have low requirements) the primary concern is low price. When this is true of a significant majority of a population, sellers who can provide cheap, low-performance goods dominate, possibly even to an extent that high-quality goods are no longer viewed as profitable enough to sell.
The “market” is the democratic will of the consumer majority, with a feedback loop. Sellers enable its whims. Buyers simultaneously obey it while deciding what it will say.
Assertion: Nothing in economics self-corrects self-destructive consumer behavior and, by extension, market behavior.
One might argue death, except sellers either have customer-turnover or a pressure to keep them well-enough to continue buying.
Assertion: People are lazy. A system wholly dependent on human actions that does not account for that is unsound.
The lesson here isn’t that capitalism should be done away with. -Well, it should when/if something better comes along.- The lesson is that scams/vice are inherently profitable. The lesson is that people have to actively campaign and influence each other to get themselves out of economic ruts. The market is not an entity that cares about you and will make everything better. The market doesn’t even care about its own well-being.
To some extent this is where government meddling comes in (laws/regulation). But that’s still just a muddled avatar of constituents’ will (both voting/shopping).
Bonus: This also applies to employees implicitly supporting companies they dislike.