New Economy rant

Max Sawicky sawicky at epinet.org
Tue Sep 26 10:50:37 PDT 2000


which is why i didn't like max's analogy. he maintained that he didn't see the point in purchasing such stereos. but it can be argued that they are indeed better quality and worth the money and that the producer is making a reasonable profit. this is not the case with nike. it is true that, as far as i'm concerned, nike and reebok and others make a better shoe than the 10$ special at walmart. but they do not make it so much better that it is really worth $150-$200 and the numbers on production costs don't support the huge mark up either. so, marx's stereo analogy seemed awkward. kelley

At the end of the day, value under consumer choice hinges on how people think about a commodity, not about what it cost to produce, nor about what you or I think it's value is. There are costs, of course, to building brand-name recognition, so the mark-up is not really the issue. It only seems to be when something is created with high fixed cost and minimal marginal cost.

Ironically, brand as value is a more social type of consumption than, say, $2K stereo systems in custom designed music rooms. You don't buy something with a swoosh to wear in your living room; you buy it for purposes of display. Of course, the implied social interaction is a warped aspect of capitalist culture.

mbs



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