Lindblom - The Market System - Afghan Journalists' Committee

160 What To Make of Itsubsidies, as a case in point, though often defended as protectionsfor low-income farmers, are paid almost entirely tohigh-income farmers or farm corporations.Ignorance and IrrationalityEfficiency prices and cost calculation do not make sages ofbuyers and sellers. Although we have made much of costcalculation as necessary to efficiency, market participantsare plagued by the general irrationalities and ignorancesthat affect all people in all social systems. That consumersoften do not know just what they are choosing is evidencedby the complexity of many products. What can a typicalconsumer know about the many specific ways in which, behindthe covering panels, one washing machine differs fromanother, or whether a white-coated physician’s diagnosis iscorrect?That consumers often do not even try to find out and insteadchoose irrationally is indicated by the heavy relianceof advertising on nonrational and irrational appeals. In thismorning’s paper, a phone company offers its services to“open up the lines of communication with your sweetie,”as though its rivals cannot. Consumers swim in an ocean ofinformation and misinformation, often unable to distinguishone from the other. Not simply spillovers but also theincompetence of all market participants—the two joiningtogether—promise occasional disasters like thalidomideand the constant risk of others.One might put these considerations aside, simply holdingthat efficiency is to be judged by what consumers thinkthey want, irrespective of their incompetence in knowingwhat they want or need. An incompetent consumer, onemight say, is a better chooser than even an ostensibly com-