RE: Marketing vs. Economics

[chris macrae]

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
itself.

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-
From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] On Behalf
Of Robin Hanson
Sent: 30 June 2003 14:27
To: [EMAIL PROTECTED]
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
to
human behavior. People buy stuff as a result of a very contextual
decision
process. In the marketing world, decisions to buy stuff are triggered
by
cost and percieved benefits, what other people are buying and what
people
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
the
same ease as they can calculate a Langrangian multiplier. Econ 101
should
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?.
Introductory
classes must meet a lot of constraints.  They must prepare those who
will
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
behavior
with rules, but such papers have hardly taken over the journals.  And
I'm
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
could
just grab material from current marketing 101 classes.  But is learning
to
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-
703-993-2326  FAX: 703-993-2323 

Re: some people are optimizers

[Fred Foldvary]

--- Wei Dai [EMAIL PROTECTED] wrote:
 and also often act directly against 
 the interest of their genes (e.g., deciding not to have children) when 
 they apply more rational decision processes.

Why is deciding not to have children against the interest of the genes?

Genes also induce people to want happiness, and children are very costly,
at least in modern society.  So the net benefit of children may well be
less than alternatives.  Note also that modern parents stop at one or two
children, rather than many, and is that too against the interest of the
genes?  Human genes endow people with the intelligence to choose not to
have children when the cost and risk are high.

Fred Foldvary

=
[EMAIL PROTECTED]

Re: some people are optimizers

[Marko Paunovic]

Fred Foldvary [EMAIL PROTECTED] wrote:

 Why is deciding not to have children against the interest of the genes?

Because gene for not wanting children will not be around for too long, but
only for one generation.

 Note also that modern parents stop at one or two
 children, rather than many, and is that too against the interest of the
 genes?

This is different situation. It might be good for your genes to invest all
your time and money in one child or two children. Why? Well, instead of
having 10 uneducated and poor children, you might want to have two highly
educated and skilled children. In human society, where education and money
matter in sexual success it makes sense.

Human genes endow people with the intelligence to choose not to
 have children when the cost and risk are high.

I can't really see a situation where decision not to have children is good
for your genes. Maybe when you have a lot of brothers and sisters and no
parents, so you invest your time and effort in them Or if it seriously
threatens your own life if you decide to have children, like during wars and
such. But even then, it is only good for your genes to postpone your
decision until such bad times pass.

Re: Do Not Call -- The newest public interest miracle?

[Wei Dai]

On Mon, Jun 30, 2003 at 12:26:41AM -0500, [EMAIL PROTECTED] wrote:
 [...] could it be done more efficiently?  Probably, but I can't think of 
 it.

I can... The Do Not Call form should take a bank account number and dollar
amount. Any advertiser who pre-pays the amount I specify would be
allowed to call me.

Re: Do Not Call -- The newest public interest miracle?

[John Morrow]

This is precisely a thought that occurred to me as a way to prevent spam -- 
computers can reduce the marginal transaction cost, and liens could be put 
up against bandwidth providers to take care of any lag in the 
system.  Would be spammers would sign contracts with their ISPs, and ISPs 
with the agencies who kept track of costs for individuals and authenticated 
email coming from contracted ISPs.  A major problem is getting a critical 
mass of people to use it, so that people are not missing email from users 
of hold out ISPs.

At 07:41 PM 7/1/2003 -0400, you wrote:
On Mon, Jun 30, 2003 at 12:26:41AM -0500, [EMAIL PROTECTED] wrote:
 [...] could it be done more efficiently?  Probably, but I can't think of
 it.
I can... The Do Not Call form should take a bank account number and dollar
amount. Any advertiser who pre-pays the amount I specify would be
allowed to call me.