1 The idea of the market-clearing price as an automatic and beneficial mechanism delivering outcomes in markets for goods and services that were both efficient and fair emerged in the final decades of the 19th century (Chapter 1)
2 The idea of the market-clearing price allowed consumers and producers to make choices about consumption, saving, production and investment by comparing prices (Chapter 1).
3 The idea of the market-clearing price made possible the emergence of mass consumer markets and mass production. It stimulated the growth of large-scale corporations and facilitated unprecedented government intervention in economic affairs (Chapter 1).
4 The emergence of the market-clearing price as the central factor in economic affairs was followed by a steady decline in the contribution tangible good production made to economic output. By the end of the first decade of the 21st century, more than 80 per cent of GDP in many advanced economies was accounted for by services (intangibles-- Chapter 1).
5 The economics of intangible production and consumption invalidates the role of price in stimulating production, consumption, saving and investment in service industries (Chapter 2)
6 Value in intangible production is created through interactive relationships at the individual level among participants in service markets (Chapter 2).
7 Technology has led to the separation of the process -- the tangibles and mechanisms that support value-creation – from the relationship at the individual level where value is actually created in services (Chapter 2).
8 In intangibles, markets and industries necessary for the production and consumption of tangibles are being replaced by intuitively-defined communities within which individuals interact to create value (Chapter 3).
9 Companies producing intangibles will face a growing calculation problem because of the decline of the validity of price as a stimulant of service production and consumption (Chapter 4).
10 Companies producing services with horizontal structures, minimal centralised decision-making and no external financial liabilities will have a competitive advantage compared with competitors that do not (Chapter 4).
11 The separation of process from relationship in value-creation in service industries will encourage companies to focus on one of the two critical skills in service value creation (Chapter 4).
12 Governments will face increasing challenges in creating value in the service markets they participate in and should concentrate on the process elements of service value-creation (Chapter 5).
13 The rise of service industries raises questions about ideas of social and economic progress that have been dominant for two centuries (Chapter 6)
Friday, 21 December 2012
The End of the Market
2 Synopsis of The End of the Market