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Advertising and Development

Advertising is an expression and part of an economic system. Each economic system has an interesting relationship with the social system, political system and cultural value. Whatever be the character of the economic system, there are three basic features which are common to all:
a) determination of goods and services and the quantities to be produced or offered;
b) allocation of resources according to priorities of production-mainly land, labor and capital; and
c) distribution of goods and services among individuals and groups. We are not concerned here about the relative importance of state intervention and market determination of these three processes.

These three processes condition the development of every society. Advertising is a major component of each one of these three processes. If advertising is a process of mediation between the producer of goods and services and the consumer, to that extent it contributes to the development not merely of the economy but also of society. If we look at development as the overall transformation of society and not merely as the statistical growth of the economy, or the gross domestic product, or the per capita income, then all advertising is socially relevant.

Modern advertising is a product of the capitalist economic system, in which the operation of the free market by and large determines the three basic features of the economic system, referred to above. It is in this context that advertising operates. When we say that modern advertising is a product of the capitalist system, it means that it serves the socio-economic needs of mass industrial production for a mass market. This situation was created by the industrial revolution under capitalism. By serving such an economic system, advertising also promotes this system. We must also remember that advertising would continue to play the same role in different economic system, as long as goods and services are produced and offered for sale in the market.

Mass production demands a mass market and a mass distribution system. The very survival of this production system demands its continuous expansion. Such an expansion means also the expansion of the market, beyond the seats of production and even beyond the boundaries of the country. This may be called the horizontal, spatial or geographical expansion of the market. Such an expansion' is both national and international. At the same time there is also a vertical expansion of the market. The objective is to bring the entire society within the orbit of the market. This does not mean only providing the individual or the family with the resources to purchase goods and services in the market. A disposable surplus is not enough. A 'psychic desire' to consume more and different products has also to be created. Expansion of the market also means the creation of new goods and services and making them acceptable to the consumer. Without such a continuous expansion of the market, the capitalist economy cannot survive. This is a constant process of the renewal and increase of capital passing through the market.

For this, people have to be informed, motivated and persuaded. With a mass market, national and international, this is only possible through a specialized communication system. Thus, modem advertising evolved, to meet precisely this requirement of the capitalist economic system. Its social relevance in the industrialist/capitalist system is to direct the desires of human beings, latent and expressed, and their needs, in such a way, as to ensure the continuation and expansion of sales of goods and services, so essential to sustain mass production by accumulated capital. Advertising is thus an integral Component of the mass distribution system of industrial capitalism. In the process of bringing consumers in touch with products or services, advertising also helps create new consumers. Thus, it is involved in the social production of consumers, on which industrial capitalism thrives. Advertising is thus not only a product of industrial capitalism, but also its promoter.

Industrial capitalism, for the very purpose of its growth and survival, has had to bring together and integrate the multi-structured, disintegrated pre-capitalist society into the mass market. It is this process that has created the nation-state. By bringing together mass production and the mass of consumers, advertising has historically played a significant role in this process of integration and nation building. By creating a common 'psychic desire' to consume, it has succeeded in bridging the gap between diverse social and cultural behavior patterns, thus nurturing a homogeneous national culture. To industrial capitalism and advertising the human being is primarily a consumer. In the market place there is no difference, in essence, among human beings in social or economic terms. They are all consumers.

The human being in the market place is at the receiving end of a veritable barrage of messages aimed at the unquestioned acceptance of a way of life and a value system. Advertising does not sell goods or services but the benefits derived from them. These benefits might be inherent in the product or service, or purely psychological; a creation of the images conjured up by advertising. The promotion of a psychology of more and more consumption sustains also a value system, which is based on ruthless competition of individual achievement, which alone enables ever-expanding consumption of an increased range and variety of goods and services. It such a way of life that alone can sustain an economic system based on the sole objective of maximization of profits. In this entire environment, the relevance of advertising is not only economic, but also social and cultural, and in the final analysis., even political. After all a particular economic structure can be sustained by a relevant political structure.

From the logic of these arguments emerge certain specific aspects of the role of advertising in a capitalist economy as a catalyst of development. First, advertising serves a social and even developmental purpose by providing people with information about goods and services available and also about new products and services. Secondly, advertising stimulates the economy -and is thus an instrument of development. Without advertising or marketing communication, products and services could not be sold in sufficient quantities. Without sales, factories would close down causing unemployment. This would further reduce demand and lead to further closing down of factories and a chain reaction would set in. On the other hand, advertising promotes sales. Higher sales mean more production, lower costs and economies of scale. This creates conditions for lower prices and hence more sales and more employment. As such this ensures the growth of the economy.

Thirdly, advertising is a component of a democratic society. The essence of democracy is that people have a choice and the right to exercise that choice. In the democratic economic system a variety of goods and services is available to choose from. Advertising enables the consumer to make the choice. The fourth aspect follows, in a way, from the third. Advertising creates conditions for every human being to acquire earned rewards. The way of life, that advertising opens up, provides motivation for hard work to earn enough to achieve such a way of life. This too is a democratic right-the right to spend one's earnings the way one likes and where a democratic system is expected to provide opportunities for the exercise of such a right.

From the fourth aspect follows the fifth. Advertising stimulates productivity. Harder work to earn more to achieve socially upward mobility, stimulated by advertising, naturally leads to higher productivity. This in turn stimulates the economy and development. Finally, all these add up to social change. We must, however, bear in mind the reality that all these factors can operate only under ideal conditions. The market does not and cannot always reflect the real social demand. This is because capitalist enterprises in the advanced industrialized countries have become so powerful and the search for maximum profits is so predominant' a concern, that they often decide what goods and services should be brought into the market so as to secure the maximum profit with the least investment. In such a system, every single one of the aspects of the role of advertising mentioned above gets distorted to some extent. In such a situation advertising creates a demand, which may not be economically or socially relevant for the immediate needs of the vast majority of the people, and hence the nation. Advertisements tell consumers what to buy. With emergence of monopolies, competition is often eliminated and advertising manipulates the consumer, giving him or her no opportunity to exercise a rational choice.

In such a situation, advertising becomes a major economic activity. As you advertise more, faster the expansion of the market, profitable volume of sales and recovery of investment in research and development. The nature of the economy in which such a situation prevails, though interrupted by increasingly longer periods of imbalances, has been described in a study of USA's needs and resources by the 20th Century Fund: "In a scarcity economy the consumer needs no conditioning to make him want enough food to keep him alive, sufficient clothing and shelter to keep warm. But in an economy of luxury and plenty, the consumer has to be persuaded to want, for example, an electric blanket, with separate thermostatic control for each side of the bed, or an air-conditioned automobile with power steering and a hydraulic drive. This constant 'education' of the consumer to desire products never heard of before is just as essential to the smooth functioning of an economy which is geared to turn out a steady flood of new and different products as are an adequate supply of electric energy and plentiful raw materials.

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