The law of demand versus diminishing marginal utility

Bruce R. Beattie; Jeffrey T. LaFrance

doi:10.1111/j.1467-9353.2006.00286.x

The law of demand versus diminishing marginal utility

Bruce R. Beattie, Jeffrey T. LaFrance

Research output: Contribution to journal › Article › Research › peer-review

13 Citations (Scopus)

Abstract

Diminishing marginal utility (DMU) is neither necessary nor sufficient for downward-sloping demand. Yet, upper-division undergraduate and beginning graduate students often presume otherwise. This paper provides two simple counter-examples that can be used to help students understand that the Law of Demand does not depend on DMU. The examples are accompanied with the geometry and basic mathematics of the utility functions and the implied ordinary/Marshallian demands.

Original language	English
Pages (from-to)	263-271
Number of pages	9
Journal	Review of Agricultural Economics
Volume	28
Issue number	2
DOIs	https://doi.org/10.1111/j.1467-9353.2006.00286.x
Publication status	Published - 1 Jun 2006
Externally published	Yes

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10.1111/j.1467-9353.2006.00286.x

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The law of demand versus diminishing marginal utility

Abstract

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