Social conditioning and economics

Good morning lions hope you're having a wonderful weekend and enjoying the weather, here in Australia it's started to get a bit chilli but we've got a beautiful autumn glow occurring. You know the kind, a cloudless cold day with rays on sunshine shining through that warm your bones.

Today I wanted to talk about economics and social conditioning, you'd think the two wouldn't exist in a free market capitalist society. But they do and social conditioning plays a large role in economics.

There is an old example given in economics that has been trialled and tested which shows how markets are spurred on more by social and cultural factors than math and its happening in cryptocurrancy too.

If you gathered 10, 20, 50 or 100 people gave them all $2.50 and told them to head into a supermarket or store to buy you a cola 90% of them would return to you a coke a cola. Many would over look cheaper or home brand colas. Despite them all being cola coke a cola would be the dominant proffered option by many.

So why is it?

Because markets just like anything in life are subjected to social and cultural factors. Over many years coke a cola has run magnificent marketing campaigns so much so that they now dominate the cola industry. I don't need to tell you that though, I bet when you saw the image above the first thing that came to mind was coke a cola. You would have thought that even if you don't like coke a cola.

You did so because we've been culturally and socially conditioned to believe that coke a cola is the dominant cola. Because of this social conditioning we openly and willingly pay more for it because we perceive it as a superior product.

Despite Coke a cola serving no nutritional requirements to our bodies more people choose coke a cola over water. In fact soft drinks as a whole contribute to obesity more than anything.

Water is the superior product but we are socially conditioned to believe that coke a cola is quenching our thirst when it is not.

In the Cryptocurrancy world Bitcoin takes this place a token that serves no real purpose but due to ongoing marketing by mainstream media and influential people we are becoming socially conditioned that it is of value.

Better than gold, a store of wealth, it will break $100,000 all this is social conditioning. Other than on block chain bitcoin still has no real use. But we're socially conditioned into believing it is a store of wealth. Bitcoin is becoming a house hold name just like coke a cola.

Social conditioning is a powerful tool in the way markets operate and depending on where you live you will have different cultural and social norms that dictate what is of value and what is not.

This is why free market capitalism does not exist or is able to be implemented. The people do not dictate the market but rather the market dictates to the people what's of value.

Fads have always been a quick market boom and dip, each generation has things of value and it can be seen more in children. From yoyos to sports cards all if which hold no value or functioning contribution to society or your life other than brief moments of entertainment or what social marketing says is the current fad.

All of a sudden kids want the latest fads to keep up with their social stature amongst friends and to fit in. She the economy becomes less about a functioning tool and more about social stature and acceptance.

Plenty of market research has been undertaken on how certain colours, sounds and emotions can draw you in to believing something is of value even down to where something is placed in the store.

Milk, bread and eggs are the staples of life. They are the most common items purchased by people. You don't need marketing to tell people to buy them, you may need it for branding to try and say which is superior but quite often these items aren't seen as socially valuable but rather a need. And things that serve need and purpose are at the bottom of what we perceive to have value. So they're cheap.

They're also often placed as far back in the store as possible so that shoppers have to walk through the entire store to get to them. When doing this with young kids, you're entering a battle field as you pass toys and all the socially conditioned items to get to your staples.

All this is down to human behaviour and gives companies the edge. When developing products more money is spent on marketing than anything else. This is because companies have one chance to hook you in and establish a social and cultural identity in the market.

Without it your item will be doomed to sit amongst a $2 shop collecting dust waiting for someone's grandparents to walk in and buy it.

It's what gives start ups a barrier and if they don't achieve this in their launch they fail. But there is another opportunity later in life because nostalgia also plays a significant role in markets.

After all it was the nostalgic past of older Brits that led BREXIT. a time of when you could go to the local farmers market to purchase cheap eggs from Joe the farmer.

Or a time when supermarket chains and corporations didn't run the game. Except nostalgia is a dangerous factor in economics as nostalgia is in the past and you're dealing with an old feeling.

Many things change over the years and those changes are brought on by social and cultural norms. The people changed the past by falling for marketing tricks and gimmicks that it is difficult to go back to the past and doing so tends to be more expensive.

I hope you enjoyed today's economics discussion and I'd be keen on hearing your thoughts and opinions on the topic.

What are some other items or goods that have surged in value due to social conditioning, can you think of a few? Pop em in the comments section below.

Image source: Canva Pro Subscription

Posted Using LeoFinance ^Beta