From: N
Sent: Thursday, February 18, 2016 8:17 PM
To: walter block
Subject: The Law of Diminishing Marginal Utility
The Law of Diminishing Marginal Utility: Each successive unit of a good grants its owner less utility than the previous unit.
Counter Example: I have a bike missing it’s two tires, surely the first tire I buy would grant me less utility than the second.
Did I go wrong? If so then where? N
Dear N:
For most economic issues, the proper unit is one apple, or one chicken. For shoes, it is two shoes, or a pair, at least usually. With regard to bike tires, the proper unit is two of them, also. Ditto for cars: four.
I suggest you read this:
Rothbard, Murray N. 1982. “Law, Property Rights, and Air Pollution,” Cato Journal, Vol. 2, No. 1, Spring; reprinted in Economics and the Environment: A Reconciliation, Walter E. Block , ed., Vancouver: The Fraser Institute, 1990, pp. 233-279; http://mises.org/story/2120; http://www.mises.org/rothbard/lawproperty.pdf;
https://mises.org/library/law-property-rights-and-air-pollution-0
and search for “technological unit.” Not only will this help solve your problem, it is also the very best essay ever written on environmental economics.
7:27 pm on January 4, 2019
