This is totally bullshit. In USSR ALL enterprises was own by government, private property prohibited and many rich people killed or jailed, even churches transformed to form of museums, so advertisement become unnecessary and nearly disappeared.
This was extremely ineffective society - because in such system people don't have any real motivation to grow and to become better.
And this leads to society of fools - when in 1990s borders opened, many scammers from all the world, made fortunes on fooling people, who just used to sterile environment without even weak manipulation, so totally defenseless for really serious scam.
Unfortunately such environment now, after 30 post-soviet years have extremely problems with economy.
Imagine, we in Ukraine have thousands engineers unemployed, or working for less than general laborer.
You may wonder, how this could happen. Answer - information inequality - engineer or any other professional know at least few times more than ordinary people (or from other specialty).
Why information inequality is so important - because even in USSR, where govt tried to make totally controlled "planning" economy, have about million products on market, so to optimize production need to solve system of equations 1Mx1M size, which is even now semi-possible.
In free market environment, complex of mechanisms "invisible hand of market", advertisement+entrepreneurs as intermediators+mechanisms of reputation, making market semi-optimal, so in real world have about 30% resources spend ineffective.
But when soviet govt claimed to make 100% effectiveness, in reality, was about 300% ineffective spending, and that's why USSR fail - just because was ineffective. This have many causes - first I already said - people was not motivated to grow anything; from lack of motivation appeared technical weakness - unmotivated people don't invent new things and not eager to adopt abroad technologies (because this also need lot of hard work); tech weakness leads to lack of modern computing infrastructure, so when USSR government dreamed about modern computers, could have only outdated hardware, steal from West (or got via grey-black schemes which is just other name of steal).
And after USSR fail, several directors of huge soviet enterprises, used scam schemes to become private owners of these enterprises, and now they brake reforms, to save their fortunes and power.
And for small business need more than 10 years to gather so much resources and reputation, to become enough powerful to run reforms. So many exUSSR countries stuck in between totalitarian and democracy (in reality I see slow motion, but seen next fact in many cases impossible to say, if it is positive or negative, or just nothing significant), and nobody could predict, how many years will spent in this extremely slow motion (or I prefer to name it hang in the air).
So, if we made advertising illegal, huge enterprises will got huge advantage over small business, and will disappear concurrency, so richest people will become rich forever and poorest people will become poor forever.
And must admit, I sometimes don't like advertisement, but it is required by market, so we need to invent some other measures to make advertisement more ethical.