The Law of Marginal Utility

In one fell swoop, we move on to action in the world. Dear students, we will now begin to outline economic laws. We’ll start with the most basic ones, the simplest ones. We’re going to start with the law of marginal utility. To study this law, we’ll imagine an action, but one that does not require the involvement of more than one human being. At this point, we’re just going to consider the action of one lone human being, one sole actor, Robinson Crusoe when he arrives on his island and hasn’t yet come into contact with Friday. We’ll begin with the simplest actions and then gradually build our edifice and add degrees of complexity to the analysis. Then, a few classes from now, we’ll bring in society. However, to understand the functioning of the complex process of human interaction, in which many people participate, we must first have a good understanding of individual human action. We’re going to start with the law of marginal utility.