The idealised market you imagine might be nice, but that's not pertinent to the question of whether the actual real-life market conforms with the mainstream economic theories or not.First, you would expect that in a rational free market with open access to information, consumers would create an easily accessible database, preferably accessible via cell-phone, that reports which brands of goods are of inferior quality.
Still, how many people are irrational enough to buy the more expensive product as a prayer that the quality will be good? I have certainly been guilty of this in the past but it is basically a response to fear that the market is filled with inferior quality products. In a rational free market with free information exchange (good information - not misinformation), that shouldn't happen.
BTW, what's your point?
My example wasn't hypothetical, I was just relating what I did last weekend. I chose the middle price, reasoning that the cheapest option would be produced using lower quality rubber and thus be more likely to fall apart disproportionately soon. Based on previous experience of cheap goods falling apart and of longer satisfaction with goods that at first appeared expensive. And like you say, we all do this at least some of the time. After all, that's why woolworths sells the same milk with two or three different labels (each label at a different price, each selling in comparable quantities). It flies in the face of textbook economic theory, but it's how the real world actually is.
But I was merely critiquing your post, not trying to make my own point, those were in post #4 of the thread. Should I trust the Keynesians or their opponents? And, please do tell me, why is there so much debate and widespread criticism specifically of economic growth?