A Rehabilitation of the Law of Diminishing Marginal Utility: An Ordinal Marginal Utility Approach

2021 ◽  
Vol 0 (0) ◽  
Author(s):  
Chung-Cheng Lin ◽  
Shi-Shu Peng
Keyword(s):  
Common Sense ◽  
Choice Theory ◽  
Marginal Utility ◽  
Individual Choice ◽  
Good Property ◽  
Total Utility ◽  
Diminishing Marginal Utility ◽  
The Law ◽  
Utility Approach

Abstract The model in which an individual maximizes his ordinal or cardinal total utility has long been the paradigm of individual choice theory. However, the two mainstream utility theories, the ordinal and cardinal total utility theories, have caused a dilemma, i.e. one has to sacrifice one of the following two: the good property of utility ordinality, or common-sense notions such as the law of diminishing marginal utility. Ordinal theory keeps the former but gives up the latter, while cardinal theory keeps the latter but sacrifices the former. We propose an ordinal marginal utility approach aiming to solve this dilemma by changing the very first assumption regarding individual choice.

scholarly journals The legitimacy of increasing marginal utility in social services: The case of university examinations

2010 ◽  
Vol 55 (186) ◽  
pp. 67-87
Author(s):  
Petar Filipic
Keyword(s):  
Economic Theory ◽  
Social Services ◽  
Utility Theory ◽  
Marginal Utility ◽  
Social Reality ◽  
Goods And Services ◽  
Diminishing Marginal Utility ◽  
The Law

The concept of utility became rightfully recognized in economic theory with the introduction of decreasing marginal utility. However a question that arises is: does an increasing consumption of goods always and without exception lead to diminishing marginal utility? It is quite possible that in some cases marginal utility of goods and services actually increases. If this fact is true, it might additionally strengthen the utility theory and make it applicable in numerous cases of economic and social reality. This paper uses the example of the utility of studying at university (i.e. the utility of university examinations), and tries to add a few arguments in favour of the statement that the law of increasing utility exists.

scholarly journals The Law of Demand versus Diminishing Marginal Utility

2006 ◽  
Vol 28 (2) ◽  
pp. 262-271 ◽  
Author(s):  
Bruce R. Beattie ◽  
Jeffrey T. LaFrance
Keyword(s):  
Marginal Utility ◽  
Law Of Demand ◽  
Diminishing Marginal Utility ◽  
The Law

scholarly journals Research on Cultural Tourism Product Development of “Impression Liu Sanjie” Based on the Law of Diminishing Marginal Utility

2021 ◽  
Vol 251 ◽  
pp. 03046
Author(s):  
Heying Li ◽  
Jinye Wang
Keyword(s):  
Marginal Utility ◽  
Development Trend ◽  
Cultural Tourism ◽  
Equation Model ◽  
Sustainable Tourism Development ◽  
Tourism Product ◽  
Diminishing Marginal Utility ◽  
The Law ◽  
Repeated Consumption ◽  
The Development Trend

According to the law of diminishing marginal utility, the marginal utility when consumers purchase a certain product shows a diminishing trend. As a special product, cultural tourism products, whether is the marginal utility produced during consumption also affected by the law of diminishing marginal utility. This paper takes “Impression Liu Sanjie” as the research object and uses a linear regression equation model to study the marginal utility of tourists “Impression Liu Sanjie” cultural tourism products. The results show that the marginal utility produced by tourists buying the cultural tourism products of “Impression Liu Sanjie” shows an obvious decreasing trend. The main reason is that the cultural tourism products of “Impression Liu Sanjie” lack innovation and strong brand characteristics, the overall scale is small, the positioning is not accurate, etc., affected by the competition of homogenized products in the surrounding area, and the return rate of tourists is low. Moreover, there is a gap between existing products and the development trend of high-end tourism, which cannot meet the needs of tourists for indepth experience and research tourism. Therefore, “Impression Liu Sanjie” needs to intensify innovation, fundamentally solve the problem of diminishing marginal utility, further stabilize the source of tourists and meet the needs of tourists for repeated consumption quality, and realize sustainable tourism development.

scholarly journals The Giffen good — a praxeological approach

Ekonomia ◽  
2018 ◽  
Vol 24 (2) ◽  
pp. 9-22
Author(s):  
Walter E. Block ◽  
Igor Wysocki
Keyword(s):  
Marginal Utility ◽  
Demand Curve ◽  
Horizontal Axis ◽  
Real Problem ◽  
Diminishing Marginal Utility ◽  
Economic Good ◽  
The Law ◽  
Giffen Good

The Giffen good — a praxeological approachIn the present paper, we argue that the shape of any respectable demand curve must be monotonic non-increasing. By doing so, we follow the footsteps of Murray Rothbard, who regarded the demand curve as derived from the law of diminishing marginal utility. However, our caveat is that the horizontal axis must represent the units of the same economic good. Equipped with the notion of the same economic good, we also argue that Giffen or Veblen goods do not pose any real problem for analysis. Rather, they behave as any other good — that is the demand curve for them is also and necessarily downward sloping.

scholarly journals The Law of Demand versus Diminishing Marginal Utility

2006 ◽  
Vol 0 (0) ◽  
pp. 060419215716004-???
Author(s):  
Bruce R. Beattie ◽  
Jeffrey T. LaFrance
Keyword(s):  
Marginal Utility ◽  
Law Of Demand ◽  
Diminishing Marginal Utility ◽  
The Law
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