The economics of creative consumption

The consensus view is that economists should observe consumer choices and abstain from investigating the psychological and physiological causes of wants, or the mechanisms governing the formation of preferences. This may be a correct procedure as far as ordinary functional goods are concerned. Problems tend to arise with creative goods (e.g. cultural goods) that share two common features, namely their consumption (i) requires skills acquired through education and actual consumption activity and (ii) generates positive and negative feedbacks and learning-by-consuming processes. This paper presents a simple model of local rational learning. Consumption generates local feedback mechanisms whose characteristics depend on the nature of goods and on the type of agent. The model provides some insights on the welfare-improving role of education policies in a liberal society.