Economic Models of Consumer Behaviour

Anupam Kumar Reader, SMS Varanasi Email: anupamkr@gmail.com Authored By:

Copyright 2010 Anupam Kumar

Economic Model
Synthesized by Alfred Marshall based on the Theory of Marginal Utility and Micro-Economic Theory.

The Focus is on the Act of Purchase of an Average Consumer.

Explains What a Consumer would purchase and In What Quantity.

Copyright 2010 Anupam Kumar

Economic Model
Basic Assumptions:
Individual Needs are Unlimited Individual Needs Cannot be Fully Satisfied. Individual is Completely Aware of his Needs Individual is a Rational Buyer Individual has the Perfect Information about the Utility of Products available in the Market The Utility of a Product or Service gets Reduced with each subsequent purchase The Price of Goods are the sole sacrifice involved in obtaining a Product or Service Market is a Collection of Homogeneous Individuals

Copyright 2010 Anupam Kumar

Economic Model
Individuals allocate their Resources to Maximize Satisfaction of their Needs and Wants Resource = Price / Money If Needs/Wants = Food Maximize Satisfaction How?

Copyright 2010 Anupam Kumar

Economic Model
Basic Assumptions:

Objections against Economic Model

Individual Needs are Unlimited Individual Needs Cannot be Fully Satisfied. Individual is Completely Aware of his Needs Individual is a Rational Buyer Individual has the Perfect Information about the Utility of Products available in the Market The Price of Goods are the sole sacrifice involved in obtaining a Product or Service Market is a Collection of Homogeneous Individuals

Individuals allocate their Resources to Maximize Satisfaction of their Needs and Wants
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Criticism to Economic Model

The major criticism to Economic Model comes from the premise, Consumers allocate their Resources to Maximize Satisfaction. Further, Economic Models Ignores the Effect of
o o o o o o o

Perception Attitude Motivation Personality Learning Process Social Class Culture

Copyright 2010 Anupam Kumar

Bibliography
Lindquist, Jay D. and Sirgy, M Joseph. Consumer Behaviour. New Delhi: Cenage Learning India Private Limited, 2009. Hawkins, Del I., Best, Roger J., Coney, Kenneth A. and Mookerjee, Amit. Consumer Behaviour: Building Marketing Strategy. Ninth Edition New Delhi: Tata McGraw-Hill Publishing Company Limited, 2007. Schiffman, Leon G. and Kanuk, Leslie L. Consumer Behaviour. Ninth Edition. New Delhi: Dorling Kindersley (India) Pvt. Ltd. Licenses of Pearson Education in South Asia, 2009. Loudon, David L. and Della Britta, Albert J. Consumer Behaviour. Fourth Edition. New Delhi: Tata McGrawHill Publishing Company Limited, 2002. Assael, Henry. Consumer Behaviour: A Strategic Approach. New Delhi: Biztantra, An Imprint of Dreamtech Press. By arrangement with Houghton Mifflin Co., USA, 2009. Khan, Martin. Consumer Behaviour. Second Edition. New Delhi: New Age International (P) Limited, 2004. Nair, Suja R. Consumer Behaviour in Indian Perspective. Mumbai: Himalya Publishing House, 2007. Kumar, S Ramesh. Consumer Behaviour and Branding: Concepts Reading and Cases. Noida: Dorling Kindersley (India) Pvt. Ltd. Licenses of Pearson Education in South Asia, 2009. Gupta, S.L. and Pal Sumitra. Consumer Behaviour: An Indian Perspective. New Delhi: Sultan Chand & Sons, 2001. Datta, Debraj and Datta Mahua. Consumer Behaviour & Advertising Management. Delhi: Vrinda Publications (P) Ltd., 2009.

Copyright 2010 Anupam Kumar

For further details / comments

Contact: Anupam Kumar Reader, SMS Varanasi Email: anupamkr@gmail.com

Copyright 2010 Anupam Kumar