ABSTRACT
THE discussion in the last chapter of the individual consumer’s market behavior has enabled us neither to help him plan his expenditures nor to sit in judgment over his behavior; but this, it must be remembered, was not the aim of our analysis. In the economist’s eyes the consumer is king; and the aim of our analysis was to see not whether consumers conform to an ideal behavior pattern but whether the economic system conforms or can be made to conform to the consumer’s wishes. For this purpose, it has been necessary, first of all, to ascertain the way in which the consumer’s wishes—whatever they may be—make themselves felt in the market as demand; and this is why, in the last chapter, we developed a method whereby we might infer the consumer’s preferences from his behavior. Much of what follows will be concerned with appraising economic institutions and policies by their conformity with consumers’ preferences. In the present chapter we shall apply this criterion to the one institution that, in the absence of a discussion of production, can be so appraised already at this stage: the consumers’ market through which consumers’ goods and services are distributed.
