I started as a market researcher 25 years ago; I have worked in 30
countries; I can testify that global marketing organisations have given
up all clues as to what local people want. In different ways that's the
message of http://www.wwdemocracy.nildram.co.uk/index.htm and
www.cluetrain.com and www.nologo.org 

I am pretty sure that economics has also given up asking the basic
questions : what organisations do people really want around them, which
are they sensible to trust? , what systematically multiplies both our
capabilities (learning, doing, inventing) as producers and as fussy
customers? For example, this sort of question wasn't even on the radar
of Bill Emmott's talk earlier this month on saving capitalism from

So in my view both subjects have veered alarmingly away from human
common sense; whether that means they could rediscover this by uniting
in a reappraisal of where they lost touch with trust and living systems
and how knowledge networks are changing world markets is a moot question

Chris Macrae, Bethesda, www.valuetrue.com 
Sample chapter available on request from me at [EMAIL PROTECTED]  on
our forthcoming book published by John Wiley on how to value
transparency and trust-flow across organisational systems

-----Original Message-----
Of Robin Hanson
Sent: 30 June 2003 14:27
Subject: Re: Marketing vs. Economics

On 6/25/2003, Fabio wrote:
>In economics, we are taught to think of people as utility maximizers.
>However, marketers tend to be much more "cognitive" in their approach
>human behavior. People buy stuff as a result of a very contextual
>process. In the marketing world, decisions to buy stuff are triggered
>cost and percieved benefits, what other people are buying and what
>remember about a product ... it seems more simple to postulate that
>people have a set of rules that they apply to some classes of economic
>behavior. ...
>- Economists need to expand the repertoire of explanations. Economists
>should learn how to model rule-based behaviors and interactions with
>same ease as they can calculate a Langrangian multiplier. Econ 101
>start with a speech saying how people sometimes apply rules to economic
>behavior and at other times they act like classical utility maximizers.
>Students will then learn marginal analysis and models that embody rules
>based behaviors.

The usual response to "someone ought to do X" is "why not you?".
classes must meet a lot of constraints.  They must prepare those who
continue in the tools that are actually used at higher levels.  And they
must give the rest some tools they can actually use to understand some
phenomena around them.

Yes, some people are having some success in explaining some kinds of
with rules, but such papers have hardly taken over the journals.  And
somewhat at a loss to think of what particular rules I would teach GMU
undergraduates to take up half of an Econ 101 class.  Of course one
just grab material from current marketing 101 classes.  But is learning
market really that important?

Robin Hanson  [EMAIL PROTECTED]  http://hanson.gmu.edu
Assistant Professor of Economics, George Mason University
MSN 1D3, Carow Hall, Fairfax VA 22030-4444
703-993-2326  FAX: 703-993-2323 

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