by Thomas R. Wells

Advertising isn't only a waste of our time and attention, our ultimate scarce resource. It is also intensely annoying. So why do we have so much of it?

It is a classic case of market failure. The advertising industry consists of the buying and selling of your attention between 3rd parties without your consent. That means that the cost of access to your attention doesn't reflect its full social cost. Movie theatres, cable channels, phone apps, and so on price the sale of your attention at what it takes to extract it from you – i.e. how easy it is for you to escape their predations – and this is often much lower than the value to you of directing your attenti­on to something else. Since advertisers pay less to access your attention than your attention is worth to you, an excessive – inefficient – amount of advertising is produced. We are all continuously swamped by attempts to distract us from what we actually want to do, like watch a movie or listen to a song, with messages we don't want or need.

The problem has the same basic structure as the overfishing of the seas or global warming. A person's attention, taken moment by moment, is a finite resource. Like a sandwich, if one party consumes it then no one else can. At the same time our current institutions make it difficult for any party to prevent others from consuming it. Our attention is a valuable commodity and everyone is out to mine it and sell it before someone else does. If we don't make some changes to the rules we may find ourselves living in a Terry Gilliam dystopia.

I

Advertising is an old racket, but these days it feels as if we are almost drowning in its insidious manipulative bullshit – inside novels, in airplanes, on concert tickets, on poor-people's foreheads, on eggs in grocery stores, on public trash cans, on the inside and outside of public buses, in police cells and on police cars, on the back of toilet doors, and on and on and on. Why is this so? A number of reasons suggest themselves.

First, as we have become more wealthy our consumption decisions have become more valuable. People can now be induced to pay much more for a carefully branded and positioned beer product than the competitive market price of the mere commodity of 'beer'. We desire and can afford a more interesting consumption experience. As a result supernormal profits are available to those who can persuade consumers to buy their version of beer. Those supernormal profits attract competitors and are therefore absorbed by competitive spending on advertising to attract customers' attention.

Second, a shift in social norms has made it more acceptable to sell other people's attention. Increased prices have spurred the development of a sophisticated market for our attention, including intermediating companies. Anyone in a position to access our attention, like the managers of pubs, hockey arenas, even personal blogs, will be approached by multiple companies offering to pay a fee to install their advertising screens, banner ads, or cookies. Simultaneous to the appearance of this new opportunity for profit has come a weakening of our moral constraints against exploiting this kind of power over people. Whether you call it neo-liberalism or something else, we are certainly living under the domination of a cult of market fundamentalism these days. The result is not only that it has become morally acceptable to sell off other people's attention without their consent in the name of free market economics. In addition, anyone who refuses to do so meets the definition of an economic idiot: someone who leaves money on the table. If he is an agent for the real owners, like the manager of a city's public bus fleet, then he is guilty of neglecting his moral duty as a trustee to secure and advance their financial interests.

Thirdly, technology has made advertising even more intrusive. Not only is it now possible to print advertisements on grocery store eggs and to put TV screens above pub urinals. The digital age has added an extra level of exploitation. Every moment we spend on the internet or with our smart phones is being captured, repackaged and sold on to advertisers multiple times. Advertisers will pay a great deal for our profiles because the better they know us the greater the effectiveness of their advertising. That's another way of saying that their advertising becomes harder to ignore. They can hunt us more assiduously and individually as we browse the internet, their banner ads and pop-ups following us around no matter where we go.

II

Advertising is a valuable commercial opportunity for businesses with access to consumers' attention, or their personal information. For the companies that buy and sell these commodities it is a win-win transaction. But advertising lacks the free market efficiency that is claimed for it. Advertising is made artificially cheap, like the output of a coal burning power station, because the price at which it is sold doesn't reflect its negative side-effects for 3rd parties – us. Defenders of advertising, including economists, point out that it has positive side-effects for consumers, including price competition and the funding of universal services like Facebook, Google and broadcast and online journalism. But their calculations generally neglect the costs to consumers' welfare of an excessive amount of advertising, and the possibility of alternative funding systems like taxes (the BBC) and philanthropy (Wikipedia). The problem is not just that particular adverts are annoying and distracting and exploit our inability to escape, but the cumulative effect of having to wade through an endless stream of sugar coated crap.

It is not impossible to bring advertising back under control, but we will need more than one lever.

First, we should reinvigorate social, and perhaps legal, norms against the excessive exploitation of our attention. We could carve out large spaces – ‘attention preserves' – which would be off-limits to advertisers (starting with restrooms). We could also put particular restrictions on the most distracting forms of advertising, with sounds or moving images. And we could restore the principle that we should give at least tacit consent to advertising, meaning that we could realistically exercise our notional right to exit (so, not airplanes or police cells or schools).

Second, we should embrace the ethic of market fundamentalism and then demand that advertising conform to it properly. The reason advertising is artificially cheap is that no one has to ask our permission to advertise at us. We are involved in the transaction only as the commodity that is being bought and sold, and therefore the value of our attention to us – the opportunity cost of being distracted and interrupted by all those self-serving deceits – does not determine its price. Instead, the market price for our attention is just the cost of digging it out of us. That's the difference between the price of conscript and free labour. From this perspective, the problem is that our property rights regime does not reflect the ideal of consumer sovereignty at the heart not only of mainstream (neoclassical) economics but also the political ideology of market fundamentalism that actually determines economic policy.

If you could assert your property rights to your attention you could sell it at a price that reflects its value to you. If advertisers had to negotiate directly with you, or at least your software agent, then they would have to start paying a price that would not leave you feeling violated. And at that price they would want to buy much less of your attention than they do at present.

III

As long as our attention and personal information are traded by 3rd parties in markets that do not incorporate their value to us, they will tend to be underpriced and used in ways that are both against our wishes and detrimental to our well-being. That constitutes both exploitation (the usual and easily ignored cry of the left) and inefficiency (the economic sin the right is always claiming to worry about). Things that we find valuable and are quintessentially our own are being stripped away from us without our consent or adequate compensation. What is needed is a change in the rules and a reassertion of our ownership of ourselves. We should have the right to determine the true value of these key commodities of the 21st century. Advertisers should pay us, not just each other.