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How can bogus claims and inferior audio thrive in a competitive market?

ahofer

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#1
I keep running into the same addlepated thought, here and in other forums. It goes something like this:

Market success is the clearest indication of value. Expensive cables must sound better, or people wouldn't pay for them; exotic amplifiers must be better or they wouldn't survive.
Even here at ASR, I've seen a few (just a few) posters go down the tubes trying to defend the idea. On Audiogon it's practically gospel from some of the most prolific posters. So let me just lay out here why it is nonsense, and I can link to it if it comes up again.

Let me state my claim explicitly (in after-posting edit): Market success proves neither a)better fidelity/accuracy, b) better sound quality, nor c) better engineering quality. It proves only that a product met the revealed preferences of some buyers, which may include, but are not limited to those three criteria. In real life, there are many criteria that complement, confuse, or even obscure these functional sound criteria. It is fine to use inaudible criteria, but sloppily confusing them with sound quality, or, worse, claiming market success *must correspond* to audible quality, only muddies the waters for those of us who prioritize fidelity and sound quality.

I am not anti-market, in fact I've been called a "market fundamentalist" by some. I make my living in financial markets. Markets allocate capital to societal preferences and capacity far better than top-down planning can. But look at the way I stated it: "preferences", "capacity", "better than top-down planning". Markets are not all-knowing, they are not moral judges, and they reflect preferences that can be self-destructive. Consider, for instance, lottery tickets, which face staggering demand for objectively minuscule expected value. There are a few bona fide instances of market failure, and even more market outcomes that are not, for example, healthy. If you want to be successful in financial markets, you need to understand cognitive bias, which we will discuss here momentarily. Actually, if these biases/behavioral irrationalities didn't exist, there would be no arbitrage profits in markets.

What do we mean by a market success? It means that people made enough purchases for the “successful” seller to survive. In audio we often don't know if they are making a decent profit, but let's assume, arguendo, that they are. So we say someone has achieved market success if they are making money selling a type of audio gear. That means that customers are, in a sense, voting for that gear, on a dollar-profit-weighted basis. Success can come from making an insanely profitable sale to one or two people, or it might come from a less profitable sale to a lot of people. Margin or volume, or both.

So there's the first flaw in the theory - a small number of high margin buyers can keep a company afloat. At the very high-priced end, If two dribbling morons give a vendor a 10,000% profit margin on five figure liquid metal cable and a custom burn-in device, the vendor may make a profit and declare himself a success. At the lower-cost end, where many tweaks reside, the lower the cost of the component or tweak, the less dollar volume it takes to “succeed”. Like these, for instance. There's hardly any fixed overhead or much marginal product cost associated with some tweaks, and the vendor can survive indefinitely with very few customers. One of the tweaks on that list involves only a phone call, thus it has almost zero marginal cost. These kinds of low-volume, low cost transactions are insufficient to generalize about customer preference and utility.

The next thing we have to discuss is 'value', or perhaps utility (in the economics sense):

the ability to gain or not to gain from a decision based on individual preferences. Utility is the want-satisfying "power" of any commodity or the capacity of a commodity to give satisfaction. Utility may measure how much one enjoys a movie, or the sense of security one gets from buying a deadbolt.
Notice that utility in the examples comes from not just how strong the deadbolt is, or the (sound?) quality of the movie in some dimension, but from any aspect of customer satisfaction (of want). Preferences, or each buyer's definition of "value', reflect utility outside of strictly functional qualities. For the purposes of this discussion, we can use "value" and "utility" interchangeably. Proponents of the argument stated at the outset tend to use "value". The point here isn't the term, but the fact that value comprises multiple criteria (conscious and unconscious) that are not strictly audible sonic quality. They may also include not just engineering (non-audible) quality, at least the kind that we can measure.

I submit that high end buyers have all kinds of inaudible and non-engineering wants to satisfy. Even more important, we are only barely aware of some of them when we spend our money. Here are a few:

Signaling

Signaling is simply sending information without stating or explaining it. Signaling is ubiquitous in human interaction - we signal status, we signal our knowledge, we signal our job fitness or academic achievements and we signal our wealth.

Purchasing luxury, or very expensive, goods is a way to signal wealth and status. People do it with cars, watches, clothes, houses, art, and even philanthropy. That big wristwatch says you are wealthy enough to afford it. It certainly doesn't tell time better, nor is it necessarily more visible to your presbyopic eyes.

Do you think your college education -strictly what you *learned* in college - was worth the tuition? Would it be worth GWU's tuition of $57,500? Is GWU? One of the most fascinating books I've read recently suggests that college isn’t about learning at all. I went to Yale, but I don't think the *education* there is any better than a number of much cheaper colleges. I haven't found too many people who would argue that. So what are we paying for? Networking, signaling to employers, status, fancy facilities, access to recruiting, sports opporunities...the list goes on.

Robin Hanson, of GMU, writes a lot about signaling. One of the most pernicious signaling effects in this day and age is "inward apology". This is when you stick your neck out to believe something ridiculous in order to signal your loyalty to a movement or group:

We can signal loyalty to a group by showing our confidence in its beliefs. And our ability to offer many reasonable arguments for its beliefs suggests such confidence. But sometimes we can show even stronger loyalty by showing a willingness to embrace unreasonable arguments for our group’s beliefs. Someone who supports a group because he thinks it has reasonable supporting arguments might well desert that group should he find better arguments against it. Someone willing to embrace unreasonable arguments for his group shows a willingness to continue supporting them no matter which way the argument winds blow.
I bet any of you can think of an example. Conspiracy theories are a big one. Think about one aspect of this: Inward apologetics must be costly to be effective signaling. Like blowing a lot of money on cable risers, perhaps? Or doubling down on internet forums about quantum stabilizers? If you were a dealer, might you engage in this behavior? If you had spent years building an objectively inferior system and becoming a big shot on Audiogon, would you do this? "Out of the crooked timber of humanity, no straight thing was ever made "

Revealed Preference

We can't discuss signaling without revealed preference. Know of anyone who flies a private jet but can't stop preaching about global warming? Do you think people virtue signal, while being hypocrites in their personal life? This is revealed preference - when your actions betray a different set of priorities than your words. Audiophiles try to conceal their revealed preference by inventing nonsense or non-descriptive sonic characteristics like Pace and Rhythm and Timing, as distinct from measurable rise times and frequency response. They say they care about "resolution" but buy an objectively concealing low S/N DAC.

Looks
Here the intersection with wristwatches and cars (also predominantly male hobbies) is strong. Look hard at the Primaluna amplifier below. The measurements are bad, and suggest unpredictable performance, particularly with variable loads. But that Italian design, oh my! Can you tell me that they, or any tube amp manufacturer, aren't selling the visual appeal of glowing tubes? A little tech-meets-modern, or steampunk.

I just asked my wife to describe this style, and the first words she said were "phallic brutalism". Well, it is a male-dominated hobby.

1571595667682.png


It isn't just that buyers want something that looks good, they want something that loudly signals their hobby and the status in the hobby they believe they have achieved. They want their equipment to scream "I have esoteric but refined tastes". Certainly there's also lots of evidence that staring at an impressive object like this will "prime" the viewer into appreciating the sound, the other parts of the experience.

Having mentioned "priming", we should consider some other behavioral finance effects. <--that link will take you to a nice summary with a top-ten list of known behavioral irrationalities. You can hover over each item on the list to see a short description. Many of these effects were identified in experiments with large numbers of market/competitive transactions, and have also been observed in real world transactions. Daniel Kahneman and Amos Tversky's nobel prize is based on Prospect Theory, which is a sort of synthesis of these effects. They are real and pernicious, and awareness does not necessarily make them go away.

The most relevant of these for High End Audio, I think, are as follows:

Narrative fallacy (I realize I have this one - well, I have all of them to some extent, but I think this one is strong with me) - we want to believe a good story. That lonely guy in his garage fiddling with MOSFETs has invented something that completely blows the big brands out of the water. Forget all that expensive Harmon research. Those wacky rebels at PS audio fiddled around with FPGAs and just totally solved all the alleged audible problems with digital audio, despite decades of well-funded research by specialists. And they keep doing it every six months - "night and day". We want to believe these kinds of outsider revolutions a) happen more often than they do and b) we are just the highly discriminating people to have discovered them. We are back to signaling, then. The narrative says something good about us.

Confirmation Bias. This is a bit like priming. After you read all those great subjective reviews, and especially if you liked the looks or the story, you are ready to hear the equipment. SURPRISE, it sounds awesome. Well....you were primed.

Loss Aversion and decision regret. I think this is more subtle, and I'm using the terms in a slightly different way from the literature. Even if you realize you made a mistake buying snake oil in the past, and its been proved to you via measurements and possibly a blind test, you bargain with those empirical results so your ego doesn't take/admit a loss. "Blind tests are bogus", you say "I can definitely hear a difference. "Not everything audible can be measured". Perhaps you let the vendor suck you into his quantum theory if you don't already know enough physics to know you are being conned/soothed. You keep coming back to the trough - to do otherwise would hurt. You might also call this the sunk cost fallacy.

Overconfidence, self-attribution bias, and herding are also clearly problems. It sounded great to you because of your skills in finding the right equipment synergies! You have golden ears, and more refined tastes than the masses! Michael Fremer raved about it in Stereophile and a bunch of people on Audioholics say it's great, so it must be. If you find yourself thinking these things (to paraphrase Jeff Buckley)...you may be irrational.

Two last things about market transactions: First, Asymmetrical Information. All markets involve information asymmetries, and when they are severe (such as medicine), market outcomes are heavily distorted. The fact is that the average equipment manufacturer knows way more about her equipment than you do. They have measurements they withheld. Only they know the actual results of their own blind testing, if they did any. They listen to equipment all day. They aren't telling you the pressure they are under to differentiate their product. It is extremely time-consuming to learn what you need to learn to make a perfectly rational purchase. In fact it is nearly impossible. You can't listen to everything. So you rely on heuristics, which usually encode some kind of bias. Information on audio is increasingly available and transparent, but there are still significant asymmetries, especially for us non-engineers. I just want good sound, I don't want to study acoustics (well, maybe a little).

Market Fragmentation increases the information asymmetry problem. We can only listen to a small sample of what's available. There are fewer and fewer audio stores, and the dealer can frame/anchor your decision within his slim coverage. You can order stuff on the internet and return it, but if you order some JBL Everests, you might have a little trouble returning them. High end speakers typically weigh 100 pounds or more. And the industry has bamboozled you with talk of "burn-in" to get you past the return period.

Finally, it is clear that audio buyers often value build quality and engineering, even when the effect on audibility is negligible or zero. A quick run through any audio mag will tell you we love quality knobs, interconnects and panels (back to 'phallic brutalism'). Audio magazines practically have centerfolds. It seems we love the appearance so much we desperately want those things to mean they sound better. We all know, in our mind of minds, that it usually ain't so.

So put this all together. Market equilibrium is where the downward-sloping demand (price=X, quantity=Y) curve meets the upward sloping supply curve for some bundle of transactional attributes (in reality this is always dynamically adjusting). We've shown that this bundle of attributes includes both real qualities and irrational preferences that are well beyond audible sonic quality. We've also shown that occasionally this equilibrium reflects only a very small subset of individuals, choice is artificially restricted, or information asymmetry distorts the equilibrium. In these cases, the result can't validly be generalized to a wider group. In fact, some might even argue that high end audio is a Giffen Good, an extreme case of signaling that defies equilibrium altogether. For these reasons, the market success, at equilibrium, of a given product cannot be used as an argument for, let alone proof of, audible sonic quality, or engineering quality.

By the way, knowledge of your biases can only take you so far. No discussion of this topic is complete without Sarah Lichtenstein's "Money Pump", in which she explains to people *how* she is ripping them off using another well-known bias, and they...just keep going for it. There's a delightful audio tape of her doing this, which I'll have to re-find, it's buried in the interwebs. (transcript here). Other examples of conscious irrationality or conscious cognitive/moral dissonance include the Stanford/Zimbardo Prison Experiment, or the Yale/Milgram torture experiments. Humans!

If you haven't already realized it, this post also constitutes a thorough argument for blind testing, as the only way to strip the sonic experience of its visual, status, confirmation bias, and other baggage. You will, however, be able to signal your objectivism if the cheap dongle happens to win. There's probably a bit of that in objective circles.
 
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#2
Because they they love people who don't question anything and take it as fact. The Ciem/IEM market runs on they flawed logic that multi driver set up is good when the crossover is laughably basic. Yet the GR8e and ER4SR fly away with one BA driver. Now you have swim through people who blindly assume the ER4S is bad because of its set up without trying it or act there ignorance is fact. I had a user flame me that did a ER4B impression on Reddit/Head fi, Go on how the ER4S is crap because of being Single BA by just parroting opinions and basing everything on a old HF5 that nowhere near the quality of ER4.


Going by your cable quote that a audiophile pretty much admitting they're wasting their money while lashing out at others who do actual research. Not silly enough to assume if it's £700+ is must be a massive jump over a HD600/ER4 on sound quality.
 

digicidal

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#4
Easy, because most people can't hear the difference.
That and there's a huge weighting based on perceived authority and/or proximal experience. If someone never hears anything other than one component, which they purchased based on some review - and they love listening to music on it... that reviewer is validated in their mind, and the brand is good. If that same reviewer (or forum, etc.) recommends a great sounding cable and they buy it... they will focus more closely on the sound and they will hear an improvement (not saying there is one... just that they will hear one). So further validation.

Add to that the inherent misconception of most (if not all on some level) consumers to equate price with quality... and you've got all you need. Are $800 shoes necessarily better than a $70 pair? My wife would have a very different answer to that question than I do (but I'd look weird wearing Jimmy Choo pumps). ;)
 

JeffS7444

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#5
Sighted listening "tests" combined with decades of writing by guys who knew a thing or two about persuasive writing has created it's own reality.

Folks who have adopted that mindset and made it their own may have a lot of money and emotions invested in these beliefs! And the last thing they want is for some smartass telling them that theirs is not a noble quest for sonic truths.

And what incentive to manufacturers have for telling them otherwise? They're about the only remaining audience for specialty audio products: Everyone else is glued to their mobile devices.
 

anmpr1

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#6
I think the exotic cable thing has to do with dealer profit. I don't know the markup, but my guess is that it's a relatively big one, and the dealer doesn't have to worry about service after the sale. It's not like cables are going to break. I'm certain that dealers like to push them off on customers who have fat wallets.

In fact, I've seen some dealers advertising cable trade ins for a reduced price. I can kind of understand someone trading in an amplifier, or record player. I guess. But you really have to be committed to the cause to trade in your 'old' cable for new, improved wire.
 

garbulky

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#8
Most people haven't heard good sound and a lot of good sound can be had at modest prices. So when they do experience good sound and the price tag is very high, people don't question it. They think they are clearly getting something better than they had ever heard at a commensurate price tag. The good looks or sophisticated packaging only goes to reinforce that they are buying into something very special. Both sides are happy. :)
I heard a >50k macintosh BW system. The sound was good but wasn't near the best I'd heard (available at far less) and it didn't beat my home system which was about a tenth of the price. However the sales rep was clearly convinced as he demonstrated the price tag by indicating that was the reason it sounded so amazing. The whole thing was designed to wow people that didn't know how good sound could be and I'm sure it succeeded.
 

Fluffy

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#9
The next issues I want to get to are Asymmetrical Information, Decision Regret, and possibly Loss Aversion and Prospect Theory.
That sounds very interesting, I will gladly read it :)

I imagine that the sunk cost fallacy is also a factor, and maybe it's one of the things you want to talk about. My theory is that people who purchase an over-priced item early in their audiophile quest, before they have real knowledge of how to spot objective sonic value, tend to retroactively justify their purchase. It creates a cognitive dissonance in their mind that turns the justification of a poor decision into an actual belief system. And that belief system drives them to buy more overpriced gear as a way of subconsciously supporting their belief that their purchases are justified by real sonic improvements.

This is by the way why after a couple of years of taking interest in the audiophile world, I haven't yet made a big purchase towards a two channel system. I'm waiting to be at a point where I feel comfortable enough in my knowledge to make an informed purchase.
 

CDMC

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#10
Market success has nothing to do with utility or value. Many highly successful products have low utility, i.e. Versace luggage, Ferrari, Rolex. The issue of trying to define why people will pay a premium for a product has flummoxed economists since the dawn of economics (I used to know more about Econ 25+ years ago when I got my degree). Were we all rational consumers purchasing the highest utility items we would all be driving Honda Accords and Toyota Camrys, or for the truck people stripped F150s. The fact is that there are plethora of reasons that people don't act as rational consumers, just three:

1) Lack of information- Most consumers spend zero time researching products they purchase. Despite there being a plethora of information available from a quick search, most consumers buy based on price and the perception that the more expensive the item is, the higher quality. An extreme example of lack of information is that most consumers still purchase cars as an impulse purchase, without even researching pricing or financing options to see if they are getting a fair deal.
2) Inaccurate information- A lot of information out there is inaccurate. Most who do a search will find articles favorable about the product they are searching thereby getting the confirmation bias that the product they are looking at is "good". It takes significant work in most cases to find objective information.
3) Prestige- A lot of purchases are motivated by wanting to keep up with their peers and have better than them. How many times does a poster ask "what are the best speakers" or "what is the best dac". The responses tell you a lot. Most people will respond with whatever their favorite brand is, because obviously if they bought it, it must be the best. Then you get the minority who realize, there is no best, there are tradeoffs to every consumer good, the trick is finding the optimum trade offs for the individual seeking the information.
 

watchnerd

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#12
I keep running into the same addlepated thought, here and in other forums. It goes something like this:



Even here at ASR, I've seen a few (just a few) posters go down the tubes trying to defend the idea. On Audiogon it's practically gospel from some of the most prolific posters. It's nonsense of course. So let me just lay out here why that is, and I can link to it if it comes up again.

What do we mean by market success? It means that people made enough purchases for the seller to survive. In audio we often don't know if they are making a decent profit, but let's assume, arguendo, that they are. So we say market success means people are making money selling a type of audio gear. That means that customers are, in a sense, voting for that gear, on a dollar-profit-weighted basis. In other words, success can come from making an insanely profitable sale to one or two people, or a less profitable sale to a lot of people. Margin or volume, or both.

So there's the first flaw in the theory - a small number of high margin buyers can keep a company afloat. At the very high-priced end, If two dribbling morons give a vendor a 10,000% profit margin on five figure liquid metal cable and a custom burn-in device, the vendor may make a profit and declare himself a success. At the lower-cost end, where many tweaks reside, the lower the cost of the component or tweak, the less dollar volume it takes to succeed. Like these, for instance. There's hardly any fixed overhead or much marginal product cost associated with some tweaks, and the vendor can survive indefinitely with very few customers. One of those tweaks involves only a phone call, thus zero marginal cost. These kinds of low-volume transactions are insufficient to say anything useful about preference and utility.

The next thing we have to discuss is 'value', or perhaps utility (in the economics sense):



Notice that utility comes from not just how strong the deadbolt is, or the (sound?) quality of the movie in some dimension, but from any aspect of customer satisfaction (of want). Preferences, or each buyer's definition of "value', reflect utility outside of strictly functional qualities. For the purposes of this discussion, we can use "value" and "utility" interchangeably. Proponents of the argument stated at the outset tend to use "value". The point here isn't the term, but the fact that value or utility and value comprise multiple criteria (conscious and unconscious) that are not strictly audible sonic quality. They may also include not just engineering (non-audible) quality, at least the kind that we can measure.

I submit that high end buyers have all kinds of inaudible wants to satisfy, and they are only barely aware of some of them. Here are a few:

Signaling

Signaling is simply sending information without explaining it. Signaling is ubiquitous in human interaction - we signal status, we signal our knowledge, we signal our job fitness or academic achievements and we signal our wealth.

Purchasing luxury, or very expensive, goods is a way to signal wealth and status. People do it with cars, watches, clothes, houses, art, and even philanthropy. That big wristwatch says you are wealthy enough to afford it. It certainly doesn't tell time better, nor is it necessarily more visible to your presbyopic eyes.

Do you think your college education -strictly what you *learned* in college, was worth the tuition? Would it be worth GWU's tuition of $57,500? Is GWU? One of the most fascinating books I've read recently covers the debate about what degree of signaling is built into college tuition. I went to Yale, but I don't think the *education* there is any better than a number of much cheaper colleges. I haven't found too many people who would argue that. So what are we paying for? Networking, signaling to employers, status...the list goes on.

Looks
Here the intersection with wristwatches and cars (also predominantly male hobbies) is strong. Look hard at that primaluna amplifier. The measurements are bad, and suggest unpredictable performance, particularly with variable loads. But that italian design, oh my. Can you tell me that they, or any tube amp manufacturer, aren't selling the visual appeal of glowing tubes? A little tech-meets-modern, or steampunk.

View attachment 36558

It isn't just that buyers want something that looks good, they want something that loudly signals their hobby and the status in the hobby they believe they have achieved. "I have esoteric but refined tastes". Certainly there's also lots of evidence that staring at an impressive object like this will "prime" the viewer into appreciating the sound, the other parts of the experience.

The next issues I want to get to are Asymmetrical Information, Decision Regret, and possibly Loss Aversion and Prospect Theory.

Apply your same thoughts to:

-Cosmetics/skin care industry
-Fitness/health supplements industry
-Homeopathic medicine

etc.

Audio is not the only one, and is in fact small relative to the others.
 
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ahofer

ahofer

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Thread Starter #14
That sounds very interesting, I will gladly read it :)

I imagine that the sunk cost fallacy is also a factor, and maybe it's one of the things you want to talk about. My theory is that people who purchase an over-priced item early in their audiophile quest, before they have real knowledge of how to spot objective sonic value, tend to retroactively justify their purchase. It creates a cognitive dissonance in their mind that turns the justification of a poor decision into an actual belief system. And that belief system drives them to buy more overpriced gear as a way of subconsciously supporting their belief that their purchases are justified by real sonic improvements.

This is by the way why after a couple of years of taking interest in the audiophile world, I haven't yet made a big purchase towards a two channel system. I'm waiting to be at a point where I feel comfortable enough in my knowledge to make an informed purchase.
Yup. I've used slightly different terms, but I think that's exactly right.
 
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ahofer

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Thread Starter #15
Apply your same thoughts to:

-Cosmetics/skin care industry
-Fitness/health supplements industry
-Homeopathic medicine

etc.

Audio is not the only one, and is in fact small relative to the others.
I apply them to the financial markets every day. But I think you and I are in agreement. The narrative fallacy, for instance, is strong within homeopathic medicine. Cosmetics signal how much you care about your appearance.
 
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ahofer

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OK, I think the essay is done, although I may go back for a few nits. Would appreciate it if you took another look. I'm sure there's more to say.
 

watchnerd

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#17
I apply them to the financial markets every day. But I think you and I are in agreement. The narrative fallacy, for instance, is strong within homeopathic medicine. Cosmetics signal how much you care about your appearance.
I'm watching the Netflix documentary on Flat Earthers right now....

Pretty interesting so far.
 

Fluffy

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#18
Read it! (and clicked all the links) :)

Wow. This is a very illuminating and important article you wrote there. It summarizes every psychological fallacy that exist in this hobby. I think this should be a must read for anyone that decides to step into a hi-fi store to buy a stereo system.

I wanted to add something regarding the narrative fallacy, that was cleverly pointed out as something you have – and that is that we all have this. This very site is also built upon a certain narrative, that objectiveness is important and measurements can reveal true audio quality. Not to say this is a false narrative, I'm just pointing out that human beings are naturally drawn to good stories to make them feel good about their choices and preferences. In my mind, you can summarize the story of ASR as "the rebel objectivists who fight with science against the kooky subjectivists". I like this narrative and I sympathize with it, and that's why I'm writing in this forum. But just like the PS audio narrative serves their sales, the ASR narrative drives us to buy things like the THX AAA 789 because of the appealing story of an affordable endgame product – despite the fact that no one can really hear a difference between a SINAD of 117 and 97.
 

Tom C

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#19
When I studied (and tutored) economics 30 years ago, it was called psychic income. Why would you pay gobs extra to get an alligator sewn onto an otherwise identical shirt? Because it makes you feel better about yourself.
A few things I learned when I started buying audio gear in the 1970’s is still true today. People like, and are impressed by, systems that are loud, and by lots of blinky lights. In-car Audio then was about radios and cassette tape. Alpine and Blaupunkt were highly regarded and expensive (I think the Blaupunkt was factory installed on Porches at the time). Both sounded pretty bad to my ears, with lots of distortion, especially the Blaupunkt. The Alpine had pretty green lights, which looked nice when you parked to make out with your girlfriend, but didn’t really sound that good. I bought an Alpine, but soon replaced it with a Jensen, which I was much more happy with.
Fast forward to today. Any audio show I go to has most rooms playing way too loud, and the stuff doesn’t sound good, even most really pricey stuff like Dan D’Agustino. But boy is it gorgeous to behold! Even my wife likes its looks.
So loud sells, and beauty sells, and those two things are easy for people to understand. Most folks don’t want to spend a lot of time and effort making a purchase decision. They just want easy. So, Apple and Amazon are very popular. And it’s not an entirely unreasonable expectation that as you spend more, you will get more. But the seller knows more than the audio neophyte, and that’s where asymmetry of information factors in. Because where I am inexperienced, I don’t know what to expect, or how to proceed, which the professional reviewers and sellers can try to take advantage of that situation.
Also, time is the ultimate scarce resource. Each minute is different than every other minute. Time cannot be made or renewed or replaced. So if someone decides that learning all about the technical details of a product is too time consuming, s/he may just go with what’s readily available. Whatever my local dealer carries, or my best friend has, etc.
You’re right. There is much to say on this subject.
 
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ahofer

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Thread Starter #20
Read it! (and clicked all the links) :)

Wow. This is a very illuminating and important article you wrote there. It summarizes every psychological fallacy that exist in this hobby. I think this should be a must read for anyone that decides to step into a hi-fi store to buy a stereo system.

I wanted to add something regarding the narrative fallacy, that was cleverly pointed out as something you have – and that is that we all have this. This very site is also built upon a certain narrative, that objectiveness is important and measurements can reveal true audio quality. Not to say this is a false narrative, I'm just pointing out that human beings are naturally drawn to good stories to make them feel good about their choices and preferences. In my mind, you can summarize the story of ASR as "the rebel objectivists who fight with science against the kooky subjectivists". I like this narrative and I sympathize with it, and that's why I'm writing in this forum. But just like the PS audio narrative serves their sales, the ASR narrative drives us to buy things like the THX AAA 789 because of the appealing story of an affordable endgame product – despite the fact that no one can really hear a difference between a SINAD of 117 and 97.
Agree 100% (with the narrative fallacy part - the rest - thanks!)
 
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