On pages 68 and 69 of the reading Markets as Institutions are some activities; for this assignment, do the exercise #5.

#5. To some economists, the medieval "just price" doctrine seems quaint, if not igno-rant. "Prices should be whatever market forces dictate!" they say. On the other hand, experiments with the "Ultimatum Game" (discussed in Chapter 2) seem to indicate that people can have very strong beliefs about what is fair and may act on these beliefs. Do you think the two views of prices can be reconciled? What might be some of the issues involved?

For this assignment, do exercises #1 and #5 from the book Markets as Institutions, which are located on pages 68 and 69.

Post an approximately 300-word response to the suggested discussion question. There are a number of ways to approach this assignment: consider the reading in relation to its historical or theoretical context; write about an aspect of the week’s reading that you don’t understand, or something that jars you; formulate an insightful question or two about the reading and then attempt to answer your own questions; or respond to another student’s post, building upon it, disagreeing with it, or re-thinking it. In any case, strive for thoughtfulness and nuance.

Suggestion Discussion Question: During the financial crisis of 2007-2009, the U.S. government bailed out some financial institutions while allowing others to fail based on the argument

that some institutions are “too big to fail.” Experts generally agree that government bail-outs of private financial institutions lead to “moral hazard” problems (i.e., a financial institution has an incentive to take on more risk not less when it knows it will be saved). Please comment on the appropriateness and effectiveness of government bail-outs of financial institutions. Explain your opinions and provide supporting evidence.

Society ignored or even criticized the contributions of marketing until the beginning of the 20th century. At that time, economies once marked by a scarcity of goods began to enjoy an abundance of goods. Marketing skills were needed to solve the distribution problems that resulted. Thus, it was not until the early 1900s that the importance of marketing was realized - and that marketing was accepted as a separate academic subject in schools and colleges. Today, countries that operate with market‑directed economies have achieved genuine improvements in standards of living - while most command economies have collapsed or are "on the ropes." Even today, however, many people do not have a very clear understanding of marketing. No one single definition of marketing will satisfy everyone. Many people - including some students and business managers - tend to think of marketing as just "selling" or "advertising." Others see marketing as an all‑inclusive social process that can solve all the world's problems. Some critics, meanwhile, seem to blame marketing for most of society's ills!

This exercise is intended to help you see more clearly what marketing is all about. One way to learn about marketing is to study the definitions in the text. Another way is to use these definitions. This is the approach you will follow in this exercise.

Assignment

Listed below is a common criticism about marketing. Discuss your viewpoint in a way that shows your understanding of marketing.

Each student should post his/her answer and post comments to other student's posting (beyond simple agreement or disagreement; but with respect to personal opinion). Also, each student must respond to at least one comment of their initial post. Participation is required.

Listed below are some commonly asked questions about marketing. Answer each of these questions in a way that shows your understanding of marketing.

How would you respond to the criticism "Marketing just adds unnecessary costs to the price of everything we buy?"

Should marketing be viewed as a set of activities performed by business and nonprofit organizations, or alternately as a social process?

Why is it important to make this distinction?