The methodological basis of the argument if applied to the existence of diminishing marginal utility
of one rational individual is relatively uncontroversial, but if applied to a group and/or society, there are long-recognized and unsolved issues of allowing interpersonal comparisons of utility, and these issues are even compounded in the intertemporal and/or intergenerational context.
Certainly it is difficult to take happiness research and experiments on loss aversion seriously while remaining convinced that diminishing marginal utility
of income provides a solid justification for government transfers.
Assume that U(M, S, X), is additive: [U.sub.MS] = [U.sub.MX] = [U.sub.SX] = 0.(4) Assume also that M and X are subject to diminishing marginal utility
: [U.sub.MM], [U.sub.XX] [less than] 0.
He devised a theory of interest and profit--which the authors also overlook, but surely of signal relevance to investors--based upon the interaction of diminishing marginal utility
with diminishing marginal productivity of time (and of time preference).
Diminishing marginal utility
implies that cov [1+[rho], [U.sub.C1]] is negative if the profit rate and consumption are positively correlated.
Here Beetle expresses the economic notion of diminishing marginal utility
as it relates to snow.
Under diminishing marginal utility
of income, part of any exogenous change in one group's income should be shared with the other group.
The Law of Diminishing Marginal Utility
applies specifically to commodities which are purely homogeneous in both space and time.
With diminishing marginal utility
for the ants receiving food, nest condition becomes relatively more important than food (their environment has changed) and some of these ants will turn to nest repair.
If there is diminishing marginal utility
in both M and Y and [Mathematical Expression Omitted] is quasiconcave in M and Y, then [WTP.sup.c] will be concave:
Note, for example, how Miller's seventh edition text proceeds to use the concept of the margin to present the principle of diminishing marginal utility
391-393) insisted on the importance of wants (as a part of economic plans) for the theory of diminishing marginal utility
and ultimately for the subjective value.