[zeroonetwothree]

Advertising is “positive sum” overall. Actually almost all economic activity is, that’s why our economy keeps growing.

And with ads the mechanism is really obvious—-it helps people identify products that solve their problems.

[pgcj_poster]

In terms of utility, advertising is negative-sum, because it misleads people about solutions to their problems. An advertiser has an incentive to try to get you to buy their product regardless of whether it's actually a good solution to your problem. In fact, it seems like the less useful a product is, the more it needs to be advertised. I've never in my life seen an ad for bread, but I've seen lots of ads for scams, fad diet books, and breakfast candy (sometimes called "cereal").

The economy growing is not necessarily a good thing. For instance, the economy would get bigger if the government passed a law requiring everyone to buy mud pies — a mud pie industry would spring up, employ lots of people, and add to the country's GDP. But society wouldn't be better to live in for it, because mud pies are useless. Likewise, the economy would be smaller if people didn't constantly replace their clothes to keep up with the latest corporate-engineered fashion, or if they stopped buying books like Rich Guy's System for Making Guaranteed Free Money in Real Estate, but people would still be better off if they did.