Fundamentals of the Theory of Diminishing Utility

Hideaki Tamura

Chapter Chapter 2 in Human Psychology and Economic Fluctuation, 2006, pp 31-58 from Palgrave Macmillan

Abstract: Abstract In the previous chapter we outlined the basis for our theory of diminishing utility in the form of a “basic human accounting” framework that illustrates the interdependence of various “accounts”—utility, goods, (work) time, and money—for both a non-monetary and a monetary economy, and argued that diminishing utility is the fundamental driver of economic activity (demand). However, we have yet to discuss specific details of the “utility account”, which functions as the engine of the economic cycle in our “basic human accounting” framework.

Keywords: Marginal Utility; Utility Level; Consumption Good; Downward Slope; Fourth Quadrant (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-50563-6_3

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DOI: 10.1057/9780230505636_3

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