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Subject:  Re: Here's your chance: Balance the Fed budget Date:  1/7/2007  10:08 AM
Author:  jcradd Number:  200461 of 606098

I'm late to the discussion on this one, but this part hit a sore point with me:

"Realize that in endless cases of marketing studies, retailers have proven that merely PLACING two exact identical grocery products (such as identically labeled green bean cans) at different vertical eye levels on a grocer's shelf can make a difference of 1-7 cents.

Perfectly free, non-coerced, non-influenced, discretionary consumers (on average) will choose the more expensively marked (from up to 7 cents more expensively marked) identical grocery items merely due to the PERCEPTION of a "unique value" of relative convenience... something with no inherent relationship even to the item in question itself!

As long as you are referring to a universe where the decision is a human decision, you cannot eliminate the distinguishment of unique value."

There is a big difference between perceived value and real value. What you are pointing out here are weaknesses in a free market system, not strengths.
- Too many resources are put into creating the perception of value, rather than real value
- Too many poor decisions are made, at many levels, due to difficulty in distinguishing real values.

I'm not really arguing against a free market or in favor of central planning. In fact I'm very much on the free market side. However I think it is important to recognize weak points in that system and work to improve them as much as practical. It may not be easy to eliminate distortion of perception from the economy, but at least start by recognizing it as undesirable and not trumpeting it as a strength.

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