Legal and Economic Aspects of Advertising

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In a sense, advertising operates within the moral constraints imposed by society, not those imposed by the most prudish elements of that society. All this does not mean that some offensive movie ads should be tolerated. Various interest groups such as business houses, governments, for-profit and non-profit organizations contribute to the well-being and well-being of society. Ethics is the most important characteristic of the advertising industry. It should avoid unfairly attacking competitors; it must be free from insults to good morals, etc. It is not reasonable to separate the economic impact from the social impact of advertising. Advertising is fundamentally an economic institution; Any overall assessment of advertising should therefore include an analysis of its economic impact. Advertising brings economic value to society in several ways. On the other hand, a lot of advertising is very informative. This applies in particular to manufacturers` advertisements informing potential buyers about the availability of products and their characteristics, as well as to retailer advertising regarding the availability, features and prices of products. In the United States, the Federal Trade Commission (FTC) is the main federal consumer protection agency. The FTC (along with the Department of Justice) is responsible for enforcing national competition laws and is the only agency that administers the nation`s most comprehensive federal law designed to protect consumers from unfair or deceptive practices, the Federal Trade Commission Act.(13) Under this Act, the most important substantive provision of which is Section 5, The FTC is committed to: that advertisers do not make false, unsubstantiated, or otherwise misleading advertising claims. If such illegal allegations are discovered, the FTC may, following formal proceedings, issue enforceable court injunctions requiring advertisers to cease false or misleading advertising.

In some cases, FTC cease and desist orders may also require defendants to make positive statements in future notices to avoid further harm to consumers(14) or to make corrective statements to their previous claims to dispel any persistent false impression they may have created. (15) An advertiser who contravenes such an order may be required to pay civil fines, which may be substantial. The free enterprise system that exists in most Western democracies is one in which individuals own the means of production and market decisions are largely made by individual firms and consumers, all acting in their own interests. This form of economic organization based on the free market has convincingly demonstrated its superiority in satisfying the needs of consumers over alternative forms of economic organization. The most important of the competing systems is socialism, in which the government owns both the means of production and makes all the final decisions on the allocation of resources. (1) Previously, I cited a standard for identifying deception based on the perception of reasonable consumers “in the [relevant] circumstances”. In cases where advertising targets specific groups, the FTC considers the characteristics of the target audience that are more or less likely to be misled by the advertisement. On the one hand, for example, the FTC is likely to take special care when investigating ads that appear particularly appealing to children because children may be more likely than adults to be deceived by certain types of claims. Conversely, the FTC would be less likely to review advertisements for over-the-counter drugs to physicians and published in medical journals than advertisements aimed at children, the sick or the elderly, since physicians are assumed to have the knowledge and ability to evaluate such claims. If so, to what extent is advertising the best way to achieve these objectives? But for those who believe it is morally wrong for advertising to convince that it is wrong for advertising to develop new “desires,” there is an even more categorical answer. For many years, critics have distinguished between economic “wants” and economic “needs.” Satisfying an economic need was seen as a good thing; A need to satisfy was considered much less worthy.

But finally, there are some big positive aspects that are now helping us to return to the usefulness of the information conveyed by advertising. Let me start with two very different quotes about advertising: the first comes from one of the founding fathers and first presidents of the United States, Thomas Jefferson, who said, “Ads contain the only truth you can count on in a newspaper.” The second comes from a well-known British author, H.G. Wells, who said, “Advertising is a legalized lie.” The standard of living is an index of the products people use in their daily lives. It refers to people`s consumer behavior, which reflects the living conditions in a country. Over time, living standards can improve through economic prosperity. Although wealth generates a better standard of living, advertising stimulates the desire for better things in life. While it spreads information and awakens the desire for better things in life, advertising does a great service. Advertising aimed at children is an area of particular concern, as critics argue that children lack the experience, knowledge and ability to process and rationally evaluate persuasive advertising messages. Although an FTC proposal to severely restrict advertising to children was rejected, this remains a problem. Today I have tried to highlight the benefits of the positive attitude towards advertising that I mentioned at the beginning of my speech. Once we recognize the potential of advertising to provide consumers with useful information that they would not otherwise have, it is up to regulators to look for solutions that preserve the valuable informative content of advertising while preventing misleading impressions.