The modern methods of propaganda and education offer a powerful tool for producing substantial changes in people's tastes at relatively low costs. For this reason, to-day the Economic Problem of a community—whether of a highly industrialised community or of an industrially backward one—does not consist merely in finding the best uses for its scarce resources so as to gratify people's actual wants to the highest possible degree. Rather, it includes also the question of how these scarce resources should be divided between productive operations for satisfying people's actual wants and measures for changing these wants. It must be decided again and again whether a given amount of resources benefits the consumers more if it is used for gratifying their present tastes in food, in housing, in music etc.—or if it is used for educating these consumer's [sic] tastes, for altering their irrational likes and dislikes (whether these result from primitive superstitions or from "civilised" prejudices), and for habituating them to new consumption goods.1
1 There is a particularly strong prima facie case for an attempt to change people's consumption habits and norms if these substantially hinder the utilisation of some of the country's basic economic resources, such as would be the case, for instance, if a primitive tribe had tabooed the consumption of the most plentiful food-stuff of its territory. (This conclusion, of course, would not apply if there were reasons to believe that this hypothetical tribe preferred the maintenance of its old ways of life to the economic advantages of such a change, in awareness of the costs entailed.)
But quite apart from such extreme cases, the standard of living in probably every country, including the most civilised, could be considerably raised by making people more familiar with, and less averse to, a few easily accessible refinements in consumption habits, in preparing food, in building and furnishing houses, etc., devised by other nations. It is astounding how ineffective, even to-day, the spread of advances in consumption habits is from country to country, in comparison with the diffusion of advances in production methods.
(John C. Harsanyi, "Welfare Economics of Variable Tastes," The Review of Economic Studies 21 [1953-1954]: 204-13, at 213 [italics in original; footnote renumbered])
