Brand Names, the Concise Encyclopedia of Economics, David R. Henderson (Ed.), the Library of Economics and Liberty, Liberty Fund, Pp 42 44 (2007).
4 Pages Posted: 28 Sep 2014
Date Written: 2007
Consumers pay a higher price for brand-name products than for products that do not carry an established brand name. Because this involves paying extra for what some consider an identical product that merely has been advertised and promoted, brand names may appear to be economically wasteful. This argument was behind the decision to eliminate all brand names on goods produced in the Soviet Union immediately after the 1917 communist revolution. The problems this experiment caused – problems described by economist Marshall Goldman – suggest that brand names serve an important economic function.
JEL Classification: L14
Suggested Citation: Suggested Citation