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Consumer sovereignty

Consumer sovereignty is the principle that consumers, through their purchasing decisions, determine the demand for goods and services, and therefore have a powerful influence on what is produced and how it is produced. This concept is based on the idea that in a market economy, firms will produce and sell goods and services that consumers want to buy, and that competition among firms will drive down prices and improve the quality of goods and services.

The idea of consumer sovereignty is often contrasted with the idea of producer sovereignty, in which firms have the primary influence on what is produced and how it is produced.

Consumer sovereignty can be distorted by the effects of persuasive or misleading advertising.

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