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:Which section do ''you'' think is arcane? Some would see the section on marginality, for the expansion of which you propose to cut other sections, as the most arcane here. Certainly, it's the least likely to be covered in other treatments. The point is not that it ''is'' arcane; it's that paring could cause isomorphic criticism from others. |
:Which section do ''you'' think is arcane? Some would see the section on marginality, for the expansion of which you propose to cut other sections, as the most arcane here. Certainly, it's the least likely to be covered in other treatments. The point is not that it ''is'' arcane; it's that paring could cause isomorphic criticism from others. |
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:I'd wager that the section that ''most'' readers would find arcane is the ''history'' section. And it is advisedly placed at the end, so that readers with no interest in how these insights were developed can easily ignore it. —[[User:SlamDiego|SlamDiego]]<sub><font size="-2">[[User_talk:SlamDiego|←T]]</font></sub> 20:39, 18 July 2009 (UTC) |
:I'd wager that the section that ''most'' readers would find arcane is the ''history'' section. And it is advisedly placed at the end, so that readers with no interest in how these insights were developed can easily ignore it. —[[User:SlamDiego|SlamDiego]]<sub><font size="-2">[[User_talk:SlamDiego|←T]]</font></sub> 20:39, 18 July 2009 (UTC) |
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==Please restore the comments that were deleted== |
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An editor, who signed as 'Doug' but did not give his Wiki user name, made some comments on this page which seemed to me very useful. User SlamDiego deleted them, interpreting them as a personal attack. I have tried to restore them, but SlamDiego deleted them again. I have tried to point out to him that the language he specifically interpreted as a personal attack does not, to me, seem like a personal attack. I would ask SlamDiego, please, to restore those comments (feel free to delete specific bits that you interpret as a personal attack); otherwise I would ask other editors to restore them. |
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My main concern about this page, like that of many others who have criticized it, is that it fails to introduce the material in an accessible way. I believe that can be done, with no lack of accuracy, as long as we make clear that simple definitions based on 'quantifications' of utility are not a fully general treatment of the concept. SlamDiego made some progress on clarifying the introduction in response to my previous comments (above), but I think, and other readers agree, that the page still fails to achieve sufficient clarity. --[[User:Rinconsoleao|Rinconsoleao]] ([[User talk:Rinconsoleao|talk]]) 08:05, 23 July 2009 (UTC) |
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Nope
I have got 'round to looking back at this article after being away from it for a while, and the lede is back to insinuating intrinsic quantification into the definition. I plan to fix this at some point in the foreseeable future. —SlamDiego←T 07:41, 10 December 2007 (UTC)
Introduction is unneccesarily complex
The introduction is way too complex to explain what marginal utility. Marginal utility is easiest defined against Total Utility rather than using an vague sentence that makes almost no sense. 86.143.19.22 (talk) 11:13, 31 January 2008 (UTC)
- Absolutely. It is far too complex. Many users have complained about this, including myself. In July 2007 I proposed the following introduction---
- In economics, under the assumption of cardinal utility, the marginal utility of a good or service is the increase in utility obtained by consuming or using one more unit of that good or service. However, this apparently simple definition hides some subtle philosophical issues. In particular, many economic thinkers argue that utility is not quantifiable: even if we can say that one consumption basket is more desirable than another, that does not imply that there is any meaningful scale of units to measure satisfaction or happiness. Therefore, "how much utility increases" when one more unit of some good is consumed is, according to this argument, a meaningless question.
- Unfortunately, User:SlamDiego insists on maintaining this page according to his/her own criteria (which, if I understand correctly, reflect an Austrian school point of view). He/she has objected repeatedly to many users' attempts to improve readability. --Rinconsoleao (talk) 11:27, 31 January 2008 (UTC)
- Well, I would think that with the studies he/she has embarked upon, the importance of clarity in communication and texts is paramount. Unfortunately, seems a personal agenda is more priori. 86.143.19.22 (talk) 11:38, 31 January 2008 (UTC)
- No, that's a willful misrepresentation of what I've been doing. What I have insisted is that quantification not be treated (explicitly or implicitly) as part of the general definition of marginal utility, because it isn't. The problem has been that people unfamiliar with the literature (other than the neoclassical literature) know only the the neoclassical view and think that they are simplifying the definition and principles when they are in fact over-simplifying them. Further, the lede was most complex after two neoclassical economists had at it (and buried the simple general definition under a circuitous paragraph of predefinitions); then neither of those two did anything after someone else came along and “simplified” the lede by removing from it that exposition of the general definiton, turning the lede back into a presentation of only the neoclassical conception. —SlamDiego←T 15:34, 31 January 2008 (UTC)
- Two errors were noted in your definition above. The most easily understood is the reference to “one more unit” — a unit is a regular change; the general concept of marginal utility does not require regular changes. The more important error is that your conception clings to a weak cardinalization of utility, confusing weakness with absence. And G_d knows that the issue of true ordinality v. weak cardinality and of unitary versus more general changes were discussed at length. —SlamDiego←T 15:50, 31 January 2008 (UTC)
- I had to fish that lede out of a long page history, so I'm not sure it was the last version. I know you had disagreements with it, in particular distinguishing 'quantified' from 'cardinal'. I would be delighted to work with you on achieving that sort of precision if you would help me achieve an introduction accessible to a wide audience. However, after previous discussions, my impression is that a sufficiently clear opening statement will not be compatible with making the opening statement an entirely general definition (if, for that matter, the latter is possible). By the way, there may have been misrepresentation above but if so it was not willful.
- By the way, my personal agenda is: (1) that the article be correct; (2) that the article be neutral; (3) that the article be a useful source of information for the largest possible audience. --Rinconsoleao (talk) 18:39, 31 January 2008 (UTC)
- I engaged in a very lengthy discussion with you on each and every point; now you assert, in effect, that you just forgot.
- Okay, now, first, an incorrect definition is simply not acceptable. A reader left with illusory understanding is worse-off than one who knows that he or she doesn't understand the subject. And a definition of “marginal utility” that assumes even weak quantification is as wrong as a definition of “mammal” that assumes a tail.
- Second, it certainly says something that you accuse me of seeking to advance the Austrian School by my insisting that the definition be correct, while the “simplifications” always operationalize as pushing the neoclassical conception.
- (If I were truly seeking to push the Austrian School, then my discussion in the article of quantification would be dismissive, or I'd do the complement of what you have done, and just delete the discussion of quantification.)
- Our empirical representative for the general audience, the member of Version 1.0 Editorial Team, didn't have any trouble with the definition. It's people who arrived here mistakenly believing that they already grasp the concept who have argued that it is confusing and has to be quantified (for expository purposes or otherwise). Indeed, those people too should be served, but [1] by being exposed to the general concept rather than having their narrow preconceptions reinforced, and [2] certainly not at the cost of misleading readers who do not come with those preconceptions.
- I offered to work with people on making the definition more accessible while keeping it correct. Instead, a neoclassical editor buried the general definition, making it seem parallel rather than more general, and requiring the reader to wade through multiple ad hoc technical predefinitions to get to the definition; while I had to deal with lots of bad math as the other kept trying to prove, after all, that quantification was fully general, and now acts as if he forgot the whole exercise, pushes the neoclassical special case definition as the one to use, and accuses me of non-neutrality.
- Bah. —SlamDiego←T 19:41, 31 January 2008 (UTC)
- My definition, shown above, is not incorrect, because it clearly refers to a special case (cardinal utility). The next paragraph then went on to discuss definitions of MU not referring to that special case. Maybe someone deleted the Austrian version, but at least in the versions I worked on after hearing your arguments, I did not delete the issue of quantification or the Austrian definition. --Rinconsoleao (talk) 18:12, 4 February 2008 (UTC)
- Your definition is incorrect as a definition; it leads the reader to believe that marginal utility is defined within the concept of cardinal utility, and meaningless otherwise.
- As to deletion, you in fact overtly acted to truly eliminate the general explanation of the “law” of diminishing marginal utility, and you certainly did nothing when the general definition was altogether removed from the lede. —SlamDiego←T 20:36, 4 February 2008 (UTC)
- The reason my proposed simplification referred to the neoclassical conception is not because I'm a neoclassical. I don't think I am one. It's because I do, in fact, think the neoclassical conception is simpler. The neoclassical conception defines MU as a difference (or derivative, depending on context) of a function. Your definition defines MU as the value associated with minimizing over one set (of uses) while maximizing over another (of actions) subject to a restriction (inclusion of a use). Actually, I'm not sure that's right, because it's very hard to state succinctly. But that's my whole point. This (purported) 'generalization' of the concept is really pretty hard to think about. The difference in a function U at two points x0 and x1 is a much simpler concept. That's why I propose focusing first on that case, even though it is essential for accuracy to point out that it is, in fact, a special case. --Rinconsoleao (talk) 18:12, 4 February 2008 (UTC)
- Again, the general concept is not more complicated. Your introduction of derivatives perfectly illustrates the issue. For you and for me, the complications of the calculus are familiar and easy; but they are complications nonetheless. And they are complications with which most readers of Wikipedia are unfamiliar; thinking in terms of functions is not something with which most readers will be comfortable. (Even simple arithmetic is a complication, albeït one familiar to most readers.) You utterly misjudge what is and is not a complication, and even what is and is not easy, because you don't see the intellectual infrastructure — and you struggle to see the flaw in that infrastructure that makes it difficult for you to recognize and understand the general concept of marginal utility.
- And it's certainly not proper for you to insist that the article push aside a concept when you admit that you can't even figure out whether it is in fact the concept.
- I tried to set up previous discussion so that you (and anyone else who was interested) could be walked through the general concept, after which you could perhaps have come up with ways of indeed expressing that concept more accessibly. Unfortunately, you were so cock-sure that I didn't understand things and you wouldn't attend to that, and you instead saturation-bombed the discussion with what proved to be mathematical duds. And the failure of that bad math didin't dissuade you from still pushing for replacing the general concept with the neoclassical conception. —SlamDiego←T 20:36, 4 February 2008 (UTC)
- I don't know who that Editorial member was, but perhaps he/she was a noneconomist checking for grammatical correctness, without knowing what the most common introductory definition of MU is? --Rinconsoleao (talk) 18:12, 4 February 2008 (UTC)
- No, the function of the Editorial Team is not to proofread. As to him not knowing what the common definition is, yeah, he probably didn't; as I keep saying, people who have been led to believe that the neoclassical conception is the general concept are, by virtue of being misled, more challenged in learning the general than those starting fresh. —SlamDiego←T 18:23, 4 February 2008 (UTC)
- My definition, shown above, is not incorrect, because it clearly refers to a special case (cardinal utility). The next paragraph then went on to discuss definitions of MU not referring to that special case. Maybe someone deleted the Austrian version, but at least in the versions I worked on after hearing your arguments, I did not delete the issue of quantification or the Austrian definition. --Rinconsoleao (talk) 18:12, 4 February 2008 (UTC)
- No, you're insisting on a definition that hangs upon some concept (that you have not here defined) which you label “Total Utility”. It's not that the lede makes “almost no sense”; it is merely that it doesn't fit your preconceptions. —SlamDiego←T 15:34, 31 January 2008 (UTC)
- You're arguing it be correct, I'm arguing that you're not understanding what the purpose of an introduction IS. An introduction shouldn't be the place to take into account every possible caveat in defining subjects; I have never seen in any of the books in other subjects that I've ever read, other than as juxtaposition to a standard definition. Although there are exceptions and other circumstances in the field of Nucleophilic substitution or Polarity, their definitions aren't rewritten to accomodate these exceptions because it defeats the purpose of what an introduction is. I don't see where the confusion is in this matter - you're by NO means a stupid person.
“ | a preliminary thing, such as an explanatory section at the beginning of a book. | ” |
- "introduction" -- Oxford English Dictionary
“ | adjective preceding or done in preparation for something fuller or more important. ORIGIN -- Latin praeliminaris, from prae ‘before’ + limen ‘threshold’. |
” |
- "preliminary"-- Oxford English Dictionary
- For users which are wanting to read this article to get a ramp into what Marginal Utility is, the old version although indeed correct just seems too complex and accomodating -- I know we're in the "business" of keeping things accurate here, but this shouldn't overwhelm one's rise to logic. If there is a problem with the definitions between neoclassical and possible conflicting theories, then I don't see why they can't precede the standard. I don't think that there are people who are consciously biased towards a particular field of Economics as I'm generaly not that skeptical. 86.151.222.13 (talk) 20:10, 1 February 2008 (UTC)
- Your claim that I do “not understanding what the purpose of an introduction IS” is foolish, and your quotations are not to-the-point.
- Again: A person who is misled is worse-off than one who realizes that he or she doesn't understand. I have repeatedly agreed that the definition would ideally be more accessible, but the lede is indeed an explanation, and it is sometimes the only part of the article with which a reader will bother. It even more important that this lede not assert that utility is quantified than that the lede for mammals not define them as having tails.
- Again: I have repeatedly declared mysedf as in favor of any definition that is more accessible than the present definition, so long as that definition is correct. No one on this talk page or in an edit to the article has presented a definition that is correct and more transparent. Instead, there has been a consistent pattern of attempts to erase or obscure the general concept, and to present the neoclassical conception as if it is the general concept.
- Again: The editor for the Version 1.0 Editorial Team had no problem with the “old” definition, so the issue of transparency has been exaggerated. The people having trouble are those with a prior exposure to the neoclassical paradigm. These people should be served, but not at the cost of reinforcing narrow conceptions nor of impairing the ability of those without such prior exposure to think more generally.
- As a matter of logic, I would also note that the neoclassical conception is in fact the more complicated — it imposes the additional (albeit familiar) structure of quantity. The general concept is not more complex; it is more abstract, which is the very nature of generality.
- —SlamDiego←T 20:43, 1 February 2008 (UTC)
- But who's being misled? The alternatives we have offered have all made clear that they are NOT fully general, and have attempted to build in the complexities of the concept gradually. Of course it would be wrong to say "MU is the difference in utility associated with consuming one more unit" without any further discussion. But that's not what the alternative versions have done, is it? --Rinconsoleao (talk) 18:23, 4 February 2008 (UTC)
- No, there it was not made clear that the definition was not fully general in the most of of what you have offered, including the most recent definition (which leads the reader to believe that marginal utility is defined in the context of cardinal utility (and that he or she must know what the ____ “cardinal” means before learning the concept). In others, you misled the reader into thinking that the generalization arose from the Benthamite notion. And (since you write of “we”), your alternatives, instead of building to the general conception, treated it as a parallel conception, and buried it in predefinitions which ensured that few weould read and virtually none could understand it. —SlamDiego←T 20:53, 4 February 2008 (UTC)
- Again, I have to insist, the definition I offer above is correct, because it explicitly warns that it is not general. Generalizations should be discussed later on if they are more complicated. --Rinconsoleao (talk) 18:50, 4 February 2008 (UTC)
- But who's being misled? The alternatives we have offered have all made clear that they are NOT fully general, and have attempted to build in the complexities of the concept gradually. Of course it would be wrong to say "MU is the difference in utility associated with consuming one more unit" without any further discussion. But that's not what the alternative versions have done, is it? --Rinconsoleao (talk) 18:23, 4 February 2008 (UTC)
- Thanks, 86, for making a great point. Personally I suspect that if we demanded the level of correctness and generality Slam is insisting on, almost every page in Wikipedia would start with a paragraph a thousand words long. Most concepts (especially complicated philosophical concepts like utility) have many caveats requiring clarification in order to be fully (if at all possible!!) correct. A good encyclopedia article, in the opinion of many people who have looked at the MU article, is one that starts with the simplest explanation possible, and then builds on sophistication over the course of the discussion. --Rinconsoleao (talk) 18:23, 4 February 2008 (UTC)
- First, stop inserting comments out-of-order. When you do so, you make it difficult if not impossible for anyone to later come along and follow the discourse.
- Second, how would you view it if a simplification theory were used to rationalize pushing the labor theory of value by some of the same people who had previously pushed it based upon a claim that it were correct? (Y'know why Ricardo used the labor theory of value? Not because he thought that it was correct, but because he thought that it was a highly useful simplification.) —SlamDiego←T 18:38, 4 February 2008 (UTC)
- My understanding is that utility is a model used to analyze human behavior. All models are simplifications. Whether a given simplification is acceptable in a given context depends on the question at hand-- i.e. does it simply help one arrive at a clear answer (good) or does it tend to qualitatively change the answer obtained (bad)? So I see no problem with Ricardo's use of that assumption for the questions he analyzed when he analyzed them. --Rinconsoleao (talk) 18:49, 4 February 2008 (UTC)
- It is a very great mistake to confuse a model with the thing modelled. The neoclassical conception is a model of utility. (Whether the conception is thus a model-of-a-model is a question that we can perhaps set aside.)
- An answer can be clear but wrong; and it can certainly be clear while qualitatively different.
- The article by Mc Culloch (referenced in the article and in previous discussion) demonstrates that the neoclassical conception precludes rational orderings that the general conception does not; hence, there is a qualitative difference introduced by the neoclassical model.
- (There would also be a resultant need in the article to discuss the issue of proxies to deal with the standard criticisms of marginal utility theory, which challenge the existence of utility.)
- The question is not whether one can get away with using a labor theory of value in some contexts. The question is of how one would feel seeing advocates of the labor theory reach for one excuse after another to rewrite the economic articles in Wikipedia (or the like) to presume said theory. —SlamDiego←T 19:12, 4 February 2008 (UTC)
- My understanding is that utility is a model used to analyze human behavior. All models are simplifications. Whether a given simplification is acceptable in a given context depends on the question at hand-- i.e. does it simply help one arrive at a clear answer (good) or does it tend to qualitatively change the answer obtained (bad)? So I see no problem with Ricardo's use of that assumption for the questions he analyzed when he analyzed them. --Rinconsoleao (talk) 18:49, 4 February 2008 (UTC)
- Your claim that I do “not understanding what the purpose of an introduction IS” is foolish, and your quotations are not to-the-point.
- For users which are wanting to read this article to get a ramp into what Marginal Utility is, the old version although indeed correct just seems too complex and accomodating -- I know we're in the "business" of keeping things accurate here, but this shouldn't overwhelm one's rise to logic. If there is a problem with the definitions between neoclassical and possible conflicting theories, then I don't see why they can't precede the standard. I don't think that there are people who are consciously biased towards a particular field of Economics as I'm generaly not that skeptical. 86.151.222.13 (talk) 20:10, 1 February 2008 (UTC)
BTW, here's a really easy conception of marginal utility for the typical reader to grasp:
- The marginal utility of a good or service is the amount by which pleasure or pain would be increased or decreased by a given increase or decrease in the good or service.
That's not only a bona fide conception, it's basically the one with which Jevons was working. (Bear in mind that he inheritted his notion of utility from John Stuart Mill.) Yet I haven't seen anyone suggesting that the lede begin with this narrow, easy conception. Instead, there is the attempt to have the lede begin with the present neoclassical conception, in which the earlier neoclassical relationship has been stood on its head (so that cardinal “utility” proxies preferences). So far, no one is arguing for starting with that far easier early British idea, and I'd be surprised if anyone seriously did, because easiness isn't a G_d to which to make such sacrifices. —SlamDiego←T 21:55, 4 February 2008 (UTC)
- The definition above sounds pretty good to me. Would you have any problem with amending it as follows:
- The marginal utility of a good or service is the amount by which utility would be increased or decreased by a given increase or decrease in the good or service.
- I would not object to a lede of that sort, providing that the article then goes on to discuss various ways in which those concepts have been more rigorously developed. --Rinconsoleao (talk) 09:19, 5 February 2008 (UTC)
- You're deliberately ducking the issue of easiness now. You want to insist that utility be presented as quantified because that's easy; well, it's easier still for the layperson to conceptualize utility as pleasure or as the reduction of pain. You won't go that far (despite the historical precedent) because you're only in favor of easiness to the extent that it advances the conception with which you have been most familiar and comfortable. (And, again, the Austrian School conception did not develop from the British conception.) —SlamDiego←T 17:22, 5 February 2008 (UTC)
- The definition above sounds pretty good to me. Would you have any problem with amending it as follows:
Thanks
Thank you, Slam. Your new introductory sentence vastly improves the readability of the definition you offer. I think it should be accessible to the typical reader. --Rinconsoleao (talk) 09:08, 8 February 2008 (UTC)
- Glad it was resolved. Boy, what a strange breed us humans are. 86.130.155.136 (talk) 15:39, 8 February 2008 (UTC)
- I remain open to anything that will increase accessibility while not introducing error or otherwise misleading the reader. —SlamDiego←T 18:53, 8 February 2008 (UTC)
I'm a random user who has very little economic background. I really want to understand marginal utility and its implications without taking an entire college course on economics. I'm by no means unintelligent or uneducated, but I still can't understand this concept based on the wiki. Could somebody explain it in plain english here, and then maybe it can be worked into an understandable article? I feel that there's too much economic jargon, even if it seems simple enough to someone well-versed in economics. 74.46.62.234 (talk) 11:48, 17 April 2009 (UTC)
- First, you need to understand that simplicity and accessibility are not the same thing. The introduction used to be very simple, with no special economics jargon, but many editors had difficulty with the resultant level of abstraction. It would be unacceptable to get both simplicity and accessibility by discarding truth, saying that marginal utility were something that it's not. And economics jargon is a way of packing ideas into a few words. If we never pack anything, then the introduction becomes a monstrous whale.
- If each of the major schools of thought that made use of a notion of marginal utility had been careful, then I could give you an uncontroversial explanation of a common conception of the general concept. That didn't happen. But I'll try to give you a clearer idea.
- When you're just gotten something or are considering getting something, like a can of soda, there is one or more possible uses to which you could put that specific can. The use to which you would/will put that can is its marginal use. The usefulness (however you judge usefulness) of that use is the marginal utility of that can.
- When you're considering giving up something, or have been made to give up something, like an old hat, there was some use to which you put that specific hat; that use was its marginal use. The usefulness (however you judge usefulness) of that use is the marginal utility of that hat.
- Now, what I just told you wouldn't be accepted as an introduction to this article, because the mainstream rarely if ever mentions or considers the notion of use in their discuss of utility. That notion lurks implicitly and unrecognized, because of confusions primarily located amongst the British marginalists, which continue into mainstream economics. In mainstream economics, they either think of utility as a quantified happiness, or they think of it as an any quantified proxy that fits preferences, and marginal utility is then the arithmetic difference in utility between having something and not having it. —SlamDiego←T 20:04, 17 April 2009 (UTC)
Images
The article is of mighty nice quality. However I think it looks a little bit boring, I believe an appropiate image or two would redeem this. Any opinions? Lord Metroid (talk) 19:58, 21 February 2008 (UTC)
- It really depends upon what sort of images one proposes to put here. —SlamDiego←T 07:25, 22 February 2008 (UTC)
- I have got no real good idea, maybe an image showing how value of a goods owner decreases with the number of goods he has or some other relationship. I want to try to promote this article to a good article and one of the criterias is images. Lord Metroid (talk) 08:49, 22 February 2008 (UTC)
- Well, first, I think that there are some issues in the writing that need to be addressed before this article is nominated as a GA.
- Most attempts to graphically depict a decrease in utility would embrace quantification. I've now dropped a graph in to the “Quantification of marginal utility” section, with a caption that makes it plain that there is a quantification assumption. Attempts to depict the relationship at a higher level of generality would involve digraphs confusing to most readers.
- Other possible illustrations could be pictures of some of the important marginalists. —SlamDiego←T 10:06, 22 February 2008 (UTC)
- I've dropped-in some pics of economic thinkers, each by a section which mentions him. (In the section on the Marginal Revolution, I made a point of selecting three economists to represent each of the three major schools — British (Jevons), Lausanne (Pareto), and Austrian (Böhm-Bawerk).) It would be nice to have a picture of Slutsky, of Hicks, or of Allen, to illustrate the “Eclipse” section. —SlamDiego←T 10:58, 23 February 2008 (UTC)
- I have got no real good idea, maybe an image showing how value of a goods owner decreases with the number of goods he has or some other relationship. I want to try to promote this article to a good article and one of the criterias is images. Lord Metroid (talk) 08:49, 22 February 2008 (UTC)
- The graph uses MU and TU on the key, and U and Q on the axes, but g is used in the text, not Q, and TU is not defined. I think I know what is meant, but could it be clarified? JBel (talk) 21:43, 15 December 2008 (UTC)
- We should probably create a relabelled clone of that chart (which was created for a different article), for this article. For what it's worth, the “” is equivalent to the “”, and the “” stands for “total utility”. —SlamDiego←T 01:36, 16 December 2008 (UTC)
- I hacked-out a clone, discarding most of the chart-junk, making it an SVG, and replacing the mysterious letters with English-language titles and legends. —SlamDiego←T 04:06, 16 December 2008 (UTC)
Risk Aversion: Equivalence v. Implication
It might not be transparent why I have altered the claim that diminishing marginal utility is equivalent to risk aversion, to a claim that it implies risk aversion.
I am used to discourse in which “risk aversion” is a name (rather than a description), in which case indeed diminishing marginal utility is equivalent to risk aversion, but the present form of the article “Risk aversion” treats “risk aversion” as a description. Diminishing marginal utility is then only equivalent to risk aversion under the assumption that utility is linear in the probabilities. —SlamDiego←T 21:27, 7 March 2008 (UTC)
- Could I see the source for that above statement? —Preceding unsigned comment added by Extropian13 (talk • contribs) 23:41, 8 June 2008 (UTC)
- Which above statement? As to the source for the claim as to how the the Wikipdia article uses “risk aversion”, see the article itself. As to the way that most mainstream texts define “risk aversion”, see any standard text that treats “choice under uncertainty”, such as Microeconomic Theory by Mas-Collel, Whinston, and Green. —SlamDiego←T 05:22, 9 June 2008 (UTC)
- The entire passage starting and ending here:
- "I am used to discourse in which “risk aversion” is a name (rather than a description), in which case indeed diminishing marginal utility is equivalent to risk aversion, but the present form of the article “Risk aversion” treats “risk aversion” as a description. Diminishing marginal utility is then only equivalent to risk aversion under the assumption that utility is linear in the probabilities."
- That entire passage is multiple statements, which is why, when you referred to “that above statement”, I asked for which. In any case, I gave you to the answer to the question that you now ask: “any standard text that treats “choice under uncertainty”, such as Microeconomic Theory by Mas-Collel, Whinston, and Green”. —SlamDiego←T 15:00, 14 June 2008 (UTC)
- It is multiple statements centered around a specific theme, which is what makes it a passage. In any event can you provide a link or citation for purposes of verification? —Preceding unsigned comment added by Extropian13 (talk • contribs) 01:34, 15 June 2008 (UTC)
- You are regressing to a repetition of the conclusion in which I am asking for the premise. I am asking for your basis of equation as opposed implication. You have thus far responded with nothing but the "evidence exists somewhere". —Preceding unsigned comment added by Extropian13 (talk • contribs) 06:49, 16 June 2008 (UTC)
- No, I've not simply said that evidence exists somewhere; I've told you specifically where you can look (and this despite your gross failure to clearly state what you sought). If you are demanding a tutorial on this point of economic theory; then I will first ask what is to be my reward for providing it to you. I'm not in the habit of providing that much free education to people who act in the manner that you do. —SlamDiego←T 12:56, 16 June 2008 (UTC)
Misrepresenting Marxism
The Marginal Revolution and Marxism
"In his critique of political economy, Marx discussed “use-value”, a concept analogous to utility:
A use-value has value only in use, and is realized only in the process of consumption. One and the same use-value can be used in various ways. But the extent of its possible application is limited by its existence as an object with distinct properties. It is, moreover, determined not only qualitatively but also quantitatively. Different use-values have different measures appropriate to their physical characteristics; for example, a bushel of wheat, a quire of paper, a yard of linen.[35]
He acknowledged that the value of a commodity is dependent on the use that can be garnered from it,[36] but, in his analysis, utility was considered as all or nothing; it was unnecessary to describe variable use-value; to Marx labor was the ultimate source of value."
I fail to see how Marx is saying use value is all or none in the above. That sounds like something you have read into it. Indeed the statement "One and the same use-value can be used in various ways." implies relative utility, which may or may not be subject to diminishing returns.
- First, you should know that the passage of interpretation to which you object was inserted by a Marxist. (You fellows trip over each other in your various interpretations and attempts to defend Marx.) Now, that prior Marxist didn't claim that the interpretation was of the quoted passage. (It might have been excised as redundant in that case.) But it's fairly easy to find exactly this interpretation in standard sources. If you want to call for a citation, it should be easy to find if someone cares to protect that sentence. —SlamDiego←T 05:35, 9 June 2008 (UTC)
- You should know as well as anyone that Marxists engage in heavy disagreements among themselves, though I fail to see how whether or not it was a Marxist that inserted the passage strengthens your interpretation. Perhaps if you can point out the specific Marxist writer you are referring to it would help.
- Pretty much everyone knwos that Marxists cannot agree amongst themselves. And what Marxists need to take ownership of their own disagreement. Instead, you do just the exact opposite, and refer to it as “your interpretation”, even in the face of being informed that it was inserted by a Marxist.
- What are you talking about take "ownership" of a disagreement? That sounds like a non-argument. Do you have any other basis for arguing against a relative interpretation of Marx's passage or are you finally ready to concede the point? —Preceding unsigned comment added by Extropian13 (talk • contribs) 01:35, 15 June 2008 (UTC)
- Irrelevant. The fact is you have no basis for your narrow interpretation. In any event can you present a citation, since as you yourself noted " it should be easy to find". —Preceding unsigned comment added by Extropian13 (talk • contribs) 06:50, 16 June 2008 (UTC)
- No, your persistent attempt to disown the dispute (once again repeated with your calling it “your narrow interpretation”) is not the principal issue, but it certainly is relevant, exactly because you keep trying to hang the albatross around non-Marxist necks.
- As to the principal issue, I'd already responded that it didn't much matter to me whether that statement stayed on not. On the one hand, that assertion anchors the whole passage to the section. On the other hand, the whole passage (quotation and interpretative assertion) was inserted into the section by a Marxist trying to champion Marxism; I just don't much care whether Marx's gropings are noted. If another Marxist (or quasi-Marxist) makes the case that the passage should go, or (what would amount to the same thing) that it should be altered in a way which makes it plainly irrelevant to the article, then I would be no more concerned than if a passage defending a Thomistic theory of value were removed. *shrug*
- None-the-less, it is (as I said) fairly easy to find support for the interpretation. One finds this interpretation, for example, in Sweezy's Theory of Capitalist Development. (Whether one further accepts Sweezy's more aggressive explusion of use-value — and whether his critics read that explusion correctly — is another matter.) Marx noted that utility is a necessary though not sufficient condition for market value in Capital V1 Ch 1 §1; yet he actually attempts to find the measure of value in physical units (of labor); thus we often get the interpretation (as with that passage) that utility just plays a thumbs-up-or-down rôle. —SlamDiego←T 13:30, 16 June 2008 (UTC)
An unwarranted generalization
This passage:
"Marginalists explain that costs of production may be what limit supply, but that these costs of production are themselves sacrificed marginal uses, and will not be borne when they are expected to exceed the marginal use of what is produced. In other words, the marginalist certainly does not explain price as a simple function of the marginal utility of a single good for one person or for some “average” person, but nonetheless insists that it results from the trade-offs that each participant would be willing to make for the various goods and services at stake, with those trade-offs being determined by marginal uses. The critics who believe that costs of production determine price, by assuming a demand that will bear the cost, have begged the essential question that the marginalists purport to answer."
Constitutes both circular reasoning, and Original Research. No source is given for the above. —Preceding unsigned comment added by Extropian13 (talk • contribs) 23:16, 8 June 2008 (UTC)
- No, it's certainly neither circular reasoning nor “original research”. The immediately previous Whatley quote
- It is not that pearls fetch a high price because men have dived for them; but on the contrary, men dive for them because they fetch a high price.
- says much of what is said above, and the rest is simply a matter of noting the difference between marginal values and average values, and the standard economic conception of cost as forgone opportunity. (See, for example, L.S.E. Essays on Cost, edited by James M. Buchanan.) —SlamDiego←T 08:30, 9 June 2008 (UTC)
- The Whitley quote is not circular, the argument as a whole based upon the quote is what is circular. The argument is to counter the criticism that the cost of production may explain increased price as an alternative to marginal utility. Countering that cost of production is itself equivalent to marginal utility ignores Ricardo's original criticism:
- Well, no, you're simply grossly misunderstanding what Whately said; the circle lies in your conception of cost. Ricardo certainly never confronted marginalism, though he attempted to deal with utility-based theories with which he was familiar. I suspect that Ricardo would have been intelligent enough to understand that his arguments against those older theories would not do against the marginalist explanation. —SlamDiego←T 15:18, 14 June 2008 (UTC)
- Those are all assumption on your part and you are still ignoring the key passage from Ricardo's argument which distinguishes the cost of production from supply and demand. The key distinguishing feature is that the price of the cost of production has an absolute bottom limit, after which if the price at which you sell a commodity no longer pays for the cost of production, such production will eventually be impossible. This shows the cost of production is something qualitatively distinct from supply and demand, and merely answering that argument by saying "it is supply and demand" constitutes begging the question. — Preceding unsigned comment added by Extropian13 (talk • contribs)
- No, I'm not ignoring key passages of Ricardo; I'm reading them in the context of my being an actual economist who actually understands marginalism. You argument is perfectly analogous to the many that come from creationists, who are often quite sure that they understand the theory of evolution and have spotted this-or-that fatal flaw in it. They too project their own circles upon their opponents' theory. The immediate problem is that you haven't grasped (however much you have reached) the point:
- Marginalists explain that costs of production may be what limit supply, but that these costs of production are themselves sacrificed marginal uses, and will not be borne when they are expected to exceed the marginal use of what is produced.
- Certainly rational people will not make X if its value is exceeded by the factors of its production, but the value of those factors is determined by the other things that they might do — alternative potential marginal uses. The cost of a factor of production is the value of the best use to which it might otherwise be put. (I have already cited for you a collection of essays on the subject of cost.) Ricardo saw a part of that (hence his theory of rent), but saw only part of it. —SlamDiego←T 08:00, 15 June 2008 (UTC)
- No, I'm not ignoring key passages of Ricardo; I'm reading them in the context of my being an actual economist who actually understands marginalism. You argument is perfectly analogous to the many that come from creationists, who are often quite sure that they understand the theory of evolution and have spotted this-or-that fatal flaw in it. They too project their own circles upon their opponents' theory. The immediate problem is that you haven't grasped (however much you have reached) the point:
- "and will not be borne when they are expected to exceed the marginal use of what is produced." That is the crux of your argument and it ignores the fact that what differentiates the cost of production from supply and demand is that the former can have a set minimum, whereas the later may not. —Preceding unsigned comment added by Extropian13 (talk • contribs) 06:53, 16 June 2008 (UTC)
- Nope. For example, knowing that physical process of production corresponds to is not adequate for computing the cost of . If we indeed knew the cost of each , then we could infer the cost of the product, but the question then is whence these costs. if we knew every possible production function for every possible product, that still wouldn't be enough, to cost anything, because we'd have to know how to prioritize what to produce (since some acts of production preclude others). With such prioritization, the cost of each could then be seen as a sacrificed priority. Ultimately, cost (the price of factors of production) are thus to be rationally determined by the price of products, rather than the other way around. The interactions of supply curves and demand curves across the various products (final or productive) allow the transmission of information for pricing even when participants don't recognize the causal flow. —SlamDiego←T 14:06, 16 June 2008 (UTC)
Why Was My Argument Deleted?
I made a good counter argument on how the creation of artificial diamonds would lower prices, and thus vindicate the labor theory of value determined by the cost of production. This argument was deleted from the criticisms section with no reason given. —Preceding unsigned comment added by Extropian13 (talk • contribs) 23:09, 8 June 2008 (UTC)
Also the above argument is not "Original Research" and thus violates no policy. It is based on another wiki article: http://en.wikipedia.org/wiki/Synthetic_diamond which itself has numerous references at the bottom. —Preceding unsigned comment added by Extropian13 (talk • contribs) 23:14, 8 June 2008 (UTC)
- You need to carefully read the Wikipedia policy on “original research”. A novel synthesis is not acceptable. Worse, what contributes to the novelty of your counter-argument is that it doesn't work for a relevant purpose — it doesn't rebut marginalism. Showing that the LTV could accommodate an outcome is only here of interest if marginalism could not. As it is, marginalism has a clear explanation as to why new technologies (or a change in the physical laws of the universe) could result in a lowered price for diamonds. —SlamDiego←T 05:50, 9 June 2008 (UTC)
- I think you need to carefully consider your criticisms. The fact of the matter is the wiki I am sourcing does itself have references I can merely quote as opposed to the wiki. I was hoping you would be able to make such a simple deduction on your own, but alas you seem interested in artificially protracting the discussion. —Preceding unsigned comment added by 72.197.139.250 (talk) 01:06, 14 June 2008 (UTC)
- When you write “the wiki I am sourcing”, it is literally gibberish, and the reader is forced to guess what you intend to say. In any event, the argument in question is incompetent, and we have no reason to take on trust your declaration that you can find such an argument a “reliable source”. —SlamDiego←T 15:28, 14 June 2008 (UTC)
- Why exactly is "Chemical and Engineering News" not a reliable source?
- http://pubs.acs.org/cen/coverstory/8205/8205diamonds.html —Preceding unsigned comment added by Extropian13 (talk • contribs) 01:40, 15 June 2008 (UTC)
- Well, we needn't much worry whether Chemical and Engineering News is “reliable source” for an economics article unless it is going to make the claims of economic theory that you want to make:
- the creation of artificial diamonds would lower prices, and thus vindicate the labor theory of value determined by the cost of production
- It doesn't do so in the article that you cite. As I stated earlier, “[s]howing that the LTV could accommodate an outcome is only here of interest if marginalism could not.” —SlamDiego←T 08:10, 15 June 2008 (UTC)
- Well, we needn't much worry whether Chemical and Engineering News is “reliable source” for an economics article unless it is going to make the claims of economic theory that you want to make:
- Wow. So what you are saying is that because the article does not explicitly say "the lower price of artificial diamonds demonstrates the labor theory of value" verbatim that it is not so. —Preceding unsigned comment added by Extropian13 (talk • contribs) 06:55, 16 June 2008 (UTC)
- In a sense, yes; but it doesn't say that because the conclusion doesn't follow. (Even a more general conclusion of cost-based pricing doesn't really follow.)
- Again, there is an analogy here with creationism. The creationists are often convinced that this or that conclusion is an obvious consequence of some set of facts, when it is no such thing, nor even a correct inference from those facts. —SlamDiego←T 14:11, 16 June 2008 (UTC)
Natural Logarithm => Logarithm ??
- Hi
- The article says: "Each had sought to resolve the St. Petersburg paradox, and had concluded that the marginal desirability of money decreased as it was accumulated, more specifically such that the desirability of a sum were the natural logarithm (Bernoulli) or square root (Cramer) thereof."
- does it make any sense for the desirability of a sum to be specifically the natural logarithm, and not just a general logarithm? (doesn't matter what base, changing logarithm base is just multiplying by a constant)
- I googled for "Daniel Bernoulli marginal logarithm" and all first four entries said it's the logarithm or a logarithmic function. none of these said he talked about specifically the natural logarithm:
Google Search Rank | URL | Quote |
---|---|---|
1st | http://www.bun.kyoto-u.ac.jp/phisci/Gallery/D.bernoulli_note.html | Daniel thought that the value of any amout of money is determined relative to one's whole wealth ... This makes y a logarithmic functin of x |
2nd | http://plato.stanford.edu/entries/paradox-stpetersburg/ | He went on to suggest that a realistic measure of the utility of money might be given by the logarithm of the money amount |
3rd | http://cepa.newschool.edu/het/essays/uncert/bernoulhyp.htm | Bernoulli originally used a logarithmic function |
4th | http://c2.com/cgi/wiki?MarginalUtility | Let U(m) be the utility (i.e. the desirability) of an amount of money ... U(.) is a slowly increasing function, and roughly logarithmic |
- Thanks, User:yairchu
- Bernoulli's actual article specifically used a natural logarithm. He could have used a more general logarithm; any other logarithm would have been an affine transform of the natural logarithm, and therefore the same relevant results would have obtained. —SlamDiego←T 01:30, 27 July 2008 (UTC)
Decreasing marginal utility, increasing marginal utility, and arithmetic
This string of edits result in presumption that utility must be quantified for there to be a violation of the “law” of diminishing marginal utility, or at least that it must be quantified for marginal utility to be in any sense increasing. That's simply not the case; the only thing required for diminishing marginal utility is that
where is the best possible use of the unit of the good or service. The only thing required for increasing marginal utility is that
And the examples presented do not require quantification to be explained or even in themselves imply quantification. (And if they had implied quantification, then the exposition should have exhibited the quantification if it were labelling the utility “cardinal”.) —SlamDiego←T 14:37, 1 September 2008 (UTC)
- The model with values seems to assume that an individual has a number of independent potential uses of a good or service and that only one unit can be used for each, where independence of these uses means that the utility of each use does not depend on application of other units for other uses (actually [1] uses the term "unrelated"). This is an interesting theory, but it seems that in many cases these assumptions do not apply. For example, the same person drinking a second ration of water is not independent/unrelated to drinking the first. In the examples I gave in the article these assumptions do no not apply either. Without these assumptions, and with ordinal utility only, it is not clear what "diminishing return" means.--Patrick (talk) 07:41, 2 September 2008 (UTC)
- Sorry, no.
- is just the marginal use; it is at least implicit in any model of behavior. In your drinking example, the first drink of water is and the second drink is .
- An assignment of a quantity of satisfaction to and another to such that the first is greater than the second will necessarily imply for some relationship ; thus, the ordering relationship amongst the marginal uses is also always at least implicit.
- While, in combination with economic rationality, an assumption of what McCulloch calls “unrelatedness” is sufficient for , it is not a necessary condition.
- What McCulloch calls “unrelatedness” isn't the a sort of independence that precludes the second glass of water being used for a second drink by the same person. Underlying such satiation are the uses to which the body puts (or, in some sense, expects to put) the additional resources.
- Quantification doesn't, in fact, serve to explain cases of or of at all. It is simply a representation, and representation is all for which mainstream economic theory typically now uses it. (Any standard graduate text on microeconomic theory will simply present a quantification that it calls “utility” as a proxy for preferences. Unfortunately, that representation is not without loss of generality (and, additionally, many people are all too eager to impute further significances to it that cannot be justified).)
- Although people are used to a presumption that “feelings” are quantified, an explanation by resort to bald reference to '“feelings” of satisfaction doesn't intrinsically entail quantification. Simply accepting that the second glass of water is less enjoyable wouldn't imply that it is arithmetically less enjoyable.
- —SlamDiego←T 08:42, 2 September 2008 (UTC)
- This "arithmetic" is meaningless if it is not related to feelings or behavior.--Patrick (talk) 09:37, 2 September 2008 (UTC)
- That's not a counter-argument. The relevant behavior is already implied in the ordering relationships; the arithmetic adds nothing, and reduces generality by excluding some rational orderings (and the behavior that they imply). As to feelings, it is only in the modern era that people have come into the habit of imputing quantity and attempting to perform arithmetic upon them.
- Distinct and important behavioral conclusions can be drawn from quantification, but the “law” of diminishing marginal utility is not amongst them, and quantification is not required for there to be deviations from the “law”. The article, further-on, has a discussion of quantification, and in its historical section notes that a theory of EU maximization entails a quantified conception of utility. (However, this article is not the place for a full-blown discussion of EU maximization.) And, as the article notes, EU maximization is not uncontroversial; as a description of actual human behavior, it is quite flawed, and it is subject to sound criticisms as a normative model.
- BTW, do not inject your comments within those of another editor; it makes the discourse very difficult for later parties to follow. —SlamDiego←T 10:07, 2 September 2008 (UTC)
- This "arithmetic" is meaningless if it is not related to feelings or behavior.--Patrick (talk) 09:37, 2 September 2008 (UTC)
- Sorry, no.
- I have avoided for now the suggestion that the examples presented require quantification. Do not delete useful clarifications and examples, modify them if you think you can improve them.--Patrick (talk) 11:44, 2 September 2008 (UTC)
- I didn't delete actual clarifications. I have no objection to the inclusion of examples, and have added one; however, your second and third examples were not substantially distinct, and I have telescoped them. I have also replaced informal language and redundancy with formal language and concision. The remaninder of your changes were inaccurate, misleading, or simply arbitrary, and the recurring use of informal language was inappropriate.
- There is no legitimate basis for thinking that quantification might be necessary for the “law” (or its breach) to be meaningful, and you should not rewrite the article to insinuate that it even might be.
- As to your desire to present the “law” more as if it were a law, that's simply unscientific. Any proposed law could trivially be said to “hold with restrictions”; every is true everywhere except where it isn't. While the “law” is on firmer ground than if it were a mere instrumental assumption (as some economic theorists would claim it to be), nonetheless it is not a tautology, it cannot be proven by introspection, and it cannot be tested in the same manner as an ordinary proposition of physics or of biology. A declaration that there is always some point past which marginal utility diminishes is either plain ol' “original research” or the regurgitation of an opinion. —SlamDiego←T 12:14, 2 September 2008 (UTC)
WP:OR and McConnell
Aaquilino's reference to McConnell is ill-considered. Nowhere in McConnell is there a proof or even a claim that diminishing marginal utility is insufficient for convexity of indifference curves. (Discussion is in the appendix to Chapter 21.) Again, the claim of insufficiency is “original research”, and it is quite in error. —SlamDiego←T 18:40, 17 October 2008 (UTC)
(Not in McConnell's text, but elsewhere, I have found authors claiming that diminishing marginal utility is not sufficient, but this claim is based on a notion of “diminishing marginal utility” such that is said to be “diminishing” when it is not, in fact, diminsihing. More specifically, it is said to be “diminishing” when it would diminish were it not for interaction with the other good. There is a distinction between utility obeying the “law” of diminishing marginal utility and utility diminsihing more generally. This issue was meant to be picked-up by the “all else being equal” earlier in the article; I have added a parenthetical note on complementarity of uses to make matters more explicit.) —SlamDiego←T 10:24, 18 October 2008 (UTC)
The deeper issue is this: marginal utility theorists were aware, before Hicks and Allen, that complementarity could throw a wrench in the works. So they assume an absence of significant complementarity as typical. Hicks and Allen just more baldly assume that indifference curves are convex. In other words, the marginal utility theorists assumed-away one thing which would lead to non-convex indifference curves, while Hicks and Allen just assumed-away the non-convexity. The fact that marginal utility theory needs the one assumption, whereas Hicks and Allen make the other, doesn't show that the former is somehow incorrect or that the latter is somehow more advanced. —SlamDiego←T 22:21, 18 October 2008 (UTC)
Tangent
McConnell does provide a fine illustration of a mainstream economists who bobbles marginal utility theory and thus thinks that it is old-fashioned and ultimately incorrect. McConnell represents indifference curve analysis as “A more advanced explanation of consumer behavior and equilibrium”. He proceeds to this comparision from the presumption, explicitly given in the Appendix to Chapter 21, in a section entitled “The Measurement of Utility”, that
The marginal utility theory assumes that utility is numerically measurable, that is, that the consumer can say how much extra utility he or she derives from each extra unit of A or B.
That's simply wrong on two counts.
First, as has been repeatedly labored on this talk page, the general theory of marginal utility does not assume that marginal utility is numerically measurable.
Second the assertions
- that utility is numerically measurable
- that the consumer can say how much extra utility he or she derives from each extra unit of A or of B
are not equivalent. That's a matter of simple logic. As many or most readers of this talk page will know, when there is an assumption of numeric measurability,
- the actual asumption is that it is known to the economist rather than necessarily to the agent
- typically, the numeric measure serves as no more than a proxy for preferences
- the measure is considered to be significant only up to an affine transformation (or perhaps up to a monotonic transformation)
—SlamDiego←T 18:40, 17 October 2008 (UTC)
Origins of the Marginal Revolution
Hello,
I just thought I'd point out that the while the Marginal Revolution may not have been a direct response to Marx himself, some scholars suggest that it was a reaction to workers movements and socialist movements who were inspired by the Ricardian labor theory of value long before Marx arrived on the scene. As Ronald Meek points out in "Studies in the Labor Theory of Value", there were many "radical economists" before Marx that picked up on the classical LTV to agitate on behalf of workers (121). —Preceding unsigned comment added by 76.171.216.108 (talk) 16:32, 21 November 2008 (UTC)
- One really shouldn't use the word “scholar” for those irresponsibly unfamiliar with the history about which they write. As the article notes, marginalist theories can be found at least as early as 1728 (almost a hundred years before Ricardo's Principles) and (though the article doesn't yet cover this area well) proto-marginalists had long recognized that some relationship between usefulness and rarity was the ultimate determinant of value. The proto-marginalists and pre-MR marginalists began challenging cost-based theories, well before socialistic economists had done anything of note with the labor theory, and when Ricardo's work came out, the proto-marginalists and pre-MR marginalists challenged it as an expression of their more general challenge. The simple fact is that over-and-over, people were producing marginalist or proto-marginalist theories. The claim that Jevons, Menger, and Walras just accidentally fit that pre-existing pattern and were really trying to refute socialist economists is obviously wishful thinking without supporting evidence. In fact, Menger seems to have been something of a social democrat, and von Wieser was quite socialistic (though the beginnings of the calculation argument may be found his work).
- What is plausible is exactly what the article already notes: That part of the reason that the work of those particular three ultimately got sustained mainstream attention was that marginalism, far more radically different from classical economics than was “radical economics”, could more ably critique Marxist economics than could classical economics. That is to say that marginalism was not itself a response to “radical economics”, but its adoption by the mainstream at least in part was. —SlamDiego←T 01:07, 22 November 2008 (UTC)
The “History” section is a history section
The “History” section is about the history of the development of the idea of marginal utility, and presents its material in historical order. The subsection “The Marginal Revolution and Marxism” is concerned with the historical significance of Marxism for the development and adoption of the idea of marginal utility, not for Marxist pot-shots from just any era. A criticism from a 1977 book plainly played no rôle during the Marginal Revolution.
As to the quotation from Mattick, with the first sentence untruncated, it is
It was not long until the entire theory of marginal utility was abandoned, since it obviously rested on circular reasoning. Although it tried to explain prices, prices were necessary to explain marginal utility.
The truncation both changes the meaning of the sentence and represents an attempt at “synthesis”. Mattick's original claim is written with a reckless disregard for the truth; one can read “A Reconsideration of the Theory of Value” and Value and Capital (by Hicks and Allen, whose work displaced marginal utility) for the actual reasons that the notion of marginal utility fell from favor, and these reasons are summarized in the subsection “Eclipse”: the mainstream didn't see circular reasoning; they saw an unnecessary assumption of some underlying quantity.
Nor was there any circle, perceived or actual, in the relationship between the explanation of prices and of marginal utility. Lots of systems exist with feedback, and explanation that acknowledge and describe feedback aren't ipso facto examples of circular reasoning.
This criticism would quite fit amongst the Marxist attacks in the “Criticism” section of “Marginalism”, insofar as that screed-of-a-subsection generally serves to make Marxists look bad by a failure of some Marxists to comprehend the structure of marginalist theory. —SlamDiego←T 11:29, 25 January 2009 (UTC)
Putting the paradox in the lede
There are problems with putting the paradox of water and diamonds in the lede section.
First, the paradox is not really one of two peculiar goods; but, without a background, many readers are going to take it as such, as if the whole point was to resolve a strangeness just about water and diamonds.
Second, even if it is made clear that this paradox exists across multiple pairings of types of gooda and of services, there is still the impression given that the principal use of the marginal utility concept is to resolve a paradox. But, while the paradox served to draw attention, the concept could have been developed without it. Indeed, Cramer and Bernoulli didn't reference that paradox at all when they made their explicit introductions of the concept, which predate those by Lloyd, Senior, &alli; the lede section could as much or more reasonably declare that “The ‘law’ of diminishing marginal utility can explain the ‘St. Petersburg paradox’” — that paradox which provoked Cramer and Bernoulli. But the concept could have been developed without consideration of either paradox, and carries a lot more water than resolving a paradox or two. —SlamDiego←T 10:09, 27 January 2009 (UTC)
Confused edit
Edit 267902796 is wrong on two counts. First, the marginal utility of one good or service is not immediately associated with a change in the quantity of any good or service, but with a change in that good or service. Second, the word “either” makes a disjunction exclusive, but there really isn't a clear distinction between goods and services. Ultimately, we want goods exactly for the service that they provide. —SlamDiego←T 23:20, 1 February 2009 (UTC)
Good article nomination
Since no one has nominated this article, I think I will. According to Wikipedia, the criteron for knowing if an article is GA is: (the article is) Useful to nearly all readers, with no obvious problems; approaching (although not equalling) the quality of a professional encyclopedia. --Forich (talk) 17:08, 15 February 2009 (UTC)
- It's a decent article, and could pass with a little work. Consider checking it against the more detailed criteria at WP:GA? before nominating. Regards, Skomorokh 17:15, 15 February 2009 (UTC)
- I think that this article runs into trouble at criterion 5. Although there has lately been considerably less edit warring here, there were repeated wars in the past, the underlying reasons for those wars have only partially abated, and promotion of this article is likely to invite the renewed attention of warriors. There wouldn't be much point in a self-defeating promotion, under which the article would fail the criteria exactly as an indirect result of having once been deemed to meet them. —SlamDiego←T 06:25, 16 February 2009 (UTC)
The water example for diminishing marginal utility isn't the best one
The problem with the water example is that it doesn't go to show that there is less value assigned to each additional water and so doesn't explain the most common scenario of the law of diminishing marginal utility as succinctly described by http://wiki.answers.com/Q/Law_of_diminishing_marginal_utility
The problem with the example is that the use of the water changes. So rather than have e1, e2, e3 (the value of the same substance water which we'd like to compare). We are really comparing uses of water, a, b and c, and the assigned relationships between them i.e. human>dog>plant. What makes this more confusing for readers is that although the dependencies between these uses are described in reality they are more complex (this is mentioned that it might be that plant>dog>human) but there might be arguments such as, why not give half the water to yourself and the second half to the dog. Obviously this seeks to alter the scenario, but ideally the hypothetical scenario chosen should not offer too many real world distractions for readers.
My biggest problem with the example is that it doesn't actually prove that diminishing marginal utility is taking place. I could claim that when you receive two waters, that actually the utility of the second water equals the first! But since the example is set up in terms of matching and you don't have the opportunity to give the 2nd water to yourself again, you can't actually demonstrate that there is less utility in it. There may indeed be the same utility in that water, but because in this hypothetical world to avoid waste the only next best thing you can do is give it to the dog, then that is what you do. Even if the example was modified to allow for the possiblity of giving the water to yourself, it wouldn't demonstrate DMU is taking place.
Can we come up with a better example please?! As it stands, I don't think this should be nominated as a good article. Even mangos with theoretical utility would be better as in wiki.answers.com. Obviously if we can find one that makes a natural comparison and is easier to understand that would be best. --Dmg46664 (talk) 15:30, 11 May 2009 (UTC)
- Sorry, but you've quite misinformed.
- Here is an famous example of the principle from Eugen von Böhm-Bawerk:
A pioneer farmer had five sacks of grain, with no way of selling them or buying more. He had five possible uses: as basic feed for himself, food to build strength, food for his chickens for dietary variation, an ingredient for making whisky and feed for his parrots to amuse him. Then the farmer lost one sack of grain. Instead of reducing every activity by a fifth, the farmer simply starved the parrots as they were of less utility than the other four uses; in other words they were on the margin. And it is on the margin, and not with a view to the big picture, that we make economic decisions.[1]
- This example is very much like the water example. Now, if you'll read about Böhm-Bawerk, you'll see that he was one of the more important figures of the Marginal Revolution, and certainly well-placed to understand the principle. So where have you gone wrong?
- Well, you're probably proceeding from what you were taught by instructors who were unaware of all but one tradition of marginalism, and thus who mistook a special case with the general theory. They (and hence you) presume that utility is at least weakly quantified, that marginal utility is a arithmetic difference or rate of change, and that utility diminishes as a result of psychological exhaustion.
- If you will attend more carefully to what the article says up-to, through, and immediately following its water examples, then you'll be exposed to a general explanation. In the absence of tipping points, rational people order uses by priority, and that is what causes marginal utility to diminish. (The diminution is a change of rank, and not necessarily quantitative.) That remains true even where various sorts of satiation are possible. Nor is there really such a thing as applying successive units to the same use. To drink a second glass of water or eat a second mango is not to put it a body that is in the same state as it was for the first glass or mango (nor will the body take the substance that it gets from the second glass or second mango and put and distribute it as it did the substance from the first). —SlamDiego←T 17:15, 11 May 2009 (UTC)
Revision of 05:16, 12 May 2009
Bkwillwm effected two changes.
The first of these, insertion of “{{main|Diminishing marginal utility}}”, created a loop-de-loop, as “Diminishing marginal utility” is just a redirect back to that very section of the article.
The second, removal of
(The diminishing of utility should not necessarily be taken to be itself an arithmetic subtraction. It may be no more than a purely ordinal change.)
is apparently supposed to be motivated by the edit summary: “This is the Austrian view of utility, which is already in the article. We don't need to qualify use of the word utility.”
The isssue that the removed section addresses is not whether marginal utility is necessarily quantitative, but whether marginal utility can diminish wihout being quantitative. The talk history of this article and discussions elsewhere have repeatedly shown that some people (including some holders of economics degrees) often think that at least a weak quantification must hold for marginal utility to be meaningfully diminishing. (Indeed, look at the objection which began the immediately previous discussion here.)
As to the relationship of the Austrian School, the mainstream notion of ordinal utility is indeed weakly quantified, based on the presumption that any rational preference ordering can be fit to some quantifications, but that none of the quantifications to which it can be fit is uniquely meaningful. It remained for J.H. McCulloch to shown (by adapting mathematical work from probability theory) that some rational preference orderings could not be it to any quantification, but that the Austrian School notion of utility, of marginal utility, and of dminishing utility remained coherent. This article doesn't need to shout “Rah! Rah! Austrian School!”, but it needs to present the subject of marginal utility at full generality. The possibility of an assumption of quantification is repeatedly noted as relevant, but it needs to be distinguished from the underlying concepts of utility, of marginal utility, and of diminishing marginal utility. —SlamDiego←T 12:59, 12 May 2009 (UTC)
- Sorry, I wasn't on my game with the edit in question. I just added a see also template link to distributive efficiency, the article I meant to link to instead of the circular link. I also jumped the gun on removing the section on ordinal utility because I've worked on other pages in the past where Austrian editors inserted qualifiers after every mention of utility. The Austrian view of utility is a minority, but legitimate, viewpoint, so it deserves attention, but not constant repetition. I thought the discussion of ordinal utility was repetitive here, but clearly it was making a point that I missed. BTW, I'm not wedded to the link to distributive efficiency, so that can be removed if others don't think it's relevant. Thanks for fixing up my edits.--Bkwillwm (talk) 00:36, 13 May 2009 (UTC)
References
But what's the goal of this article?
Is the goal to describe what experts know, or to educate the general public? These are two completely different things. (It seems to me, the goal must be clearly resolved and authors must be willing to pay the costs of that choice.)
For example the short section on Marginality seems to do the former, but not the latter. The reason why it makes sense to the expert is because he already has examples in his head. But to the general public without those anchors, almost any of those sentences can have many meanings. Compound all those possible paths as sentence is added to sentence, and one quickly lands in confusion and chaos.
One possible remedy for this is to add examples. (Or when complex, perhaps several varied examples.)
One cost of adding examples is adding bulk. This implies cuts elsewhere may have to be made in the name of best reaching the over all goal. However, would not the general public find many of these subcategories rather rare and arcane? An encyclopedia article should not attempt to outline a semester.
I am often disappointed in Wiki's technical articles that have not subjected themselves to this discipline, and seem to be written for the pleasure of the authors, ("See MY education!") rather than to educate the general public. —Preceding unsigned comment added by 68.127.88.207 (talk) 20:01, 18 July 2009 (UTC)
- The goal of this article is to provide an accurate explanation of its subject. Accessibility is desirable everywhere that it can be achieved without a loss of accuracy.
- As to the discussion of marginality, upon investigation you'd in fact find that most encyclopediae and textbooks on marginal utility and marginalistm never bother to explain the concept of marginality at all. Further, while examples might well improve the accessibility of the section, what it actually requires to be understood are not examples but just a knowledge of logic and of English, and neither at the level of someone whose education focussed on either field. No one is showing off education in that section, though the ability of the reader to think may be over-estimated.
- Which section do you think is arcane? Some would see the section on marginality, for the expansion of which you propose to cut other sections, as the most arcane here. Certainly, it's the least likely to be covered in other treatments. The point is not that it is arcane; it's that paring could cause isomorphic criticism from others.
- I'd wager that the section that most readers would find arcane is the history section. And it is advisedly placed at the end, so that readers with no interest in how these insights were developed can easily ignore it. —SlamDiego←T 20:39, 18 July 2009 (UTC)
Please restore the comments that were deleted
An editor, who signed as 'Doug' but did not give his Wiki user name, made some comments on this page which seemed to me very useful. User SlamDiego deleted them, interpreting them as a personal attack. I have tried to restore them, but SlamDiego deleted them again. I have tried to point out to him that the language he specifically interpreted as a personal attack does not, to me, seem like a personal attack. I would ask SlamDiego, please, to restore those comments (feel free to delete specific bits that you interpret as a personal attack); otherwise I would ask other editors to restore them.
My main concern about this page, like that of many others who have criticized it, is that it fails to introduce the material in an accessible way. I believe that can be done, with no lack of accuracy, as long as we make clear that simple definitions based on 'quantifications' of utility are not a fully general treatment of the concept. SlamDiego made some progress on clarifying the introduction in response to my previous comments (above), but I think, and other readers agree, that the page still fails to achieve sufficient clarity. --Rinconsoleao (talk) 08:05, 23 July 2009 (UTC)