Ghost of John Kenneth Galbraith Writes for AMC

3 Aug

One of the things that struck me watching AMC’s orginal series Mad Men (about the workings of a Madison Avenue ad agency in 1960) was the deeply cynical view of advertising–one that closely follows the view Ken Galbraith put forth in The Affluent Society.

Or does it? Galbraith saw advertising, in part, as a way of manipulating consumers, inducing them to buy things that they didn’t really need, or at least convincing them that they needed it. This is a distortion of competition, but a reality of the big firms and technostructure Galbraith saw dominating American business. While microeconomics allows for this less than ideal picture of competition (rather than lowering prices to increase demand, firms can spend money on advertsing to attract consumers) Galbraith’s thesis always bothered me because, taken to it’s extreme, we get AdBusters type nonsense.  It assumes a model of the consumer as easily duped, or someone so taken by affluent spectacle and advertising spin that they’ll purchase almost anything, given the right ad campaign.

In some ways, though, both views are consistent.  As John Quiggin summarized shortly after Galbraith’s death last year,  the Becker/Murphy model of advertising (a fairly “mathed up” economic study) views ads as complements to the consumption of what’s advertised:

An obvious case of the Becker-Murphy story arises when the ads tell a story that enhances the subjective value of consuming the good in question. A pair of shoes that make you feel like a basketball star is better (for the target market) than a pair of shoes that just covers your feet.

Ads are informational insofar as they tell you that there is a new product, but their primary function is to attach some intangible good (or “aura,” as Tyler Cowen likes to say about cultural products) to the product that you would like to buy along with it.  In this view, Galbraith’s observation is still generally correct, but instead of duping us we have to admit to buying things along with the products that we might not want to admit we’re buying.

So yes, they are selling you “cool” when you buy cigarettes.  But only because you feel like a loser.


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