Where the law of the invisible hand fails : applying the perspectives of an economic tourist as he ventures into the heart of antediluvian economics

Abstract

Abstract: Value is subjective. Pricing structures are assumed to be an expression of value, but the problem is that they do not really express a universal value. While tourists may be armed with a bundle of local currency and a supply of sunscreen to protect themselves from the elements of nature, it’s really the established institutions within the territory that pose the real threat to the sanity of the decision maker. This paper examines the role of ‘Information’ in an institutional framework with the aim of exploring the challenges that an economic tourist would be confronted with when attempting to determine the value of a commodity. This within a market which cannot be determined using typical market fundamentals. While an archetypal tourist would be capable of following a road map that may confirm his belief in the markets. However, his own interpretation of the information on that map will be challenged as he ventures further into the world of an antediluvian market where low levels of competition exist and the interaction between supply and demand would best be described as unstable. The problems that modern day economic tourists would face is greatly increased as they are confronted by new and unpredictable institutional information. This information has been developed over centuries within a culturally biased informational context regarding commodities and products in different markets. The real value of a product in an antediluvian economy is determined by the ‘value of Information’ held by the institution within that economy which would serve as a regulator of ‘value’. While value is subjective, the price set within the antediluvian economy may echo issues such as political, social and economic conditions, not reflected in the price, and thus create a flood of misperception to the aspiring tourists