In John K. Galbraith’s famous book, The Affluent Society, he talks about the “dependence effect”, or how production creates wants:
If the individual’s wants are to be urgent, they must be original with himself. They cannot be urgent if they must be contrived for him. And above all, they must not be contrived by the process of production by which they are satisfied. For this means that the whole case for the urgency of production, based on the urgency of wants, falls to the ground.
This implies that increasing production doesn’t make society better off. The demand for goods does not rise in “spontaneous consumer need”, but instead grows out of the process of production itself. Without this process, the increase in demand would not occur and the utility gained from these contrived wants is zero.
The theory was extremely controversial when it was published and was attacked by many different famous…
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