ABSTRACT
This chapter provides an introduction to viewing demand from a behavioral perspective. Luxuries are goods that are not necessary for life either biologically or socially but are demanded because of an acquired taste; or because we are manipulated psychologically into wanting them; or in order to obtain social status by virtue of their being trendy or because of their exclusiveness. Consumer sovereignty is the mainstream doctrine that consumers dictate what businesses produce insofar as they “vote” with their dollars to channel production in such a way as to satisfy their desires. Consumer sovereignty is captured by the business community using mass communication channels including social media. The mainstream argument is that increasing the number of products raises welfare, because it increases consumers’ choices. In the end, consumers are in charge as they determine what is being produced. Consumer sovereignty is merely a mirage in the real existing economy.
