Comment by Marsymars

My point is that advertising can grow the pie, but it doesn't necessarily do so, and even if advertising is net pie-growing, it can still shrink the pie in specific markets.

For a more on-the-nose example than the arms race between car manufacturers, consider cigarette ads. If the ads simply convert smokers between brands, then it's basically zero sum minus the cost of the ads. If the ads convert non-smokers, then the ads are of significant negative utility taking their externalities into account.

> Very few ads are for products where exact 1:1 competitors exist

Sure, but also, I'd contend that few purchases are made based on ads informing consumers of meaningful differences between products. The products could be 1:1 duplicates, and the ads could be identical.

e.g. I just turned off my ad-blocker and fired up YouTube, the first four ads I see:

1. An ad for a multivitamin. Zero mention of any differentiating feature from a generic multivitamin.

2. An ad for a grocery delivery service. Zero mention of any differentiating features from any other food delivery service. (This one was a bit wild to me - this is actually service I already know and use, I'd never seen advertising for them, and this ad didn't mention any of the reasons anyone would choose to use them.)

3. An ad for some predatory-looking debt-relief service. Maybe not predatory, but no information about why that debt-relief service would be better than any other debt relief service.

4. An ad for a jeans company. I actually had to google this one to figure out what it was even an ad for, the ad just featured shots of people hiking in mountains and dunking into icy lakes without any mention of clothing.