The Science of Demand (31) - Unofficial Translation of Steven Cheung's 经济解释 - 科学说需求

Section 4.  The Assumption of Unchanging Tastes

In the analysis of demand, it is commonplace that change in taste will affect demand. Whenever taste changes, the whole demand curve will shift to the right (demand rises) or to the left (demand falls). Maybe I am the only one with a different view. If the law of demand is applied to explain behavior, we should assume the taste of every individual stays unchanged.

Philosophically or in faith, I agree that taste does exist and am unsure if taste does not change. The problem is we are no God, therefore unable to determine how a person’s taste is like and whether that person’s taste has changed. Change in taste in economics is just a game: whenever a person’s behavior changes, it is claimed that person’s taste has changed. What kind of science is this? When all behavior is explainable by change in taste, what refutable implication would still remain? Maybe it can be so stated: all who draw on change in taste to explain behavior are mentally deficient.

Everyone is born with dissimilar taste. This being highly agreeable, I therefore cannot deny the existence of taste. However, from the perspective of empirical science, applying changing tastes to explain behavior is devoid of content.

Let’s cite a few examples. As mentioned earlier, recurrent plane crashes will spread a negative message around to lower demand for air tickets. Yet is it due to a change in the taste of consumers, or the negative message having an adverse impact on the demand for air tickets? Change in message will possibly lead to change in taste, yet unlike change in message, change in taste is not visible. We cannot derive any refutable implication by merely referring to change in taste. But since change in message is a fact, an implication that the demand for air tickets will fall can be derived. As such, we need not be concerned if taste has been changed.

Another example is: if time is spent appreciating classical music by people who originally dislike it, after a while, they may start to enjoy it, or may even be captivated. I will not object if you say the tastes of these people toward classical music have changed, though we need not draw on any change in tastes to explain the increase in demand. By pointing out that these people listen more to classical music, or the cultural environment has changed, or their new acquaintances are all fans of classical music, we can surmise their increased demand for classical music.

I am not saying taste is indeed unchanged, but that in using change in taste to explain behavior, it is impossible to derive any refutable implication. What we need to find out is the reason for the change in taste. And if we know the reason, there is no need to refer to any change in taste at all.

The question is that no one has ever been able to explain behavior purely by drawing on change in taste. Doing so is no more than a tautological statement – stated but devoid of content. To explain change in demand, we must base on changes in observable things or constraints. Having done this, there is no need to draw on taste.

I am neither saying there is no such thing as taste, nor that taste does not change. Maybe man is borne with unchanging taste, with his demand only influenced by different information, experiences or knowledge; or man may change his taste due to change in information. These issues are outside the realm of economics. What I insist is that economics cannot use taste as a pretense to explain behavior that we are incapable of explaining, or to salvage theoretical implications which have already been refuted. To abrogate these pretenses, the simplest way is to assume everyone’s taste remains unchanged.