Tuesday, June 24, 2003

Okay, it turns out the term of art I was looking for is Diminishing Marginal Utility. Unfortunately, there seems to be some disagreement on the question of whether DMU applies to monetary wealth. Now, DMU seems to be considered an almost universal law, and those who claim it never applies to monetary wealth are either Objectivists, and therefore insane (man, it's fun to poke the Randians), or folks who are rejecting the premise because they don't like the conclusion it would lead them to (such as that a flat tax is bad). Anybody out there got an concrete studies on why DMU does or does not apply to monetary wealth? Preferably ones that a layman can understand. Because I've found a few abstracts that might well be what I'm looking for, but they might as well be in Martian, and I'm not sure I'm willing to learn a new language just to win an argument.

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