The law of demand versus diminishing marginal utility

Bruce R. Beattie, Jeffrey T. LaFrance

Research output: Contribution to journalArticle

5 Scopus citations

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 languageEnglish (US)
Pages (from-to)262-271
Number of pages10
JournalReview of Agricultural Economics
Volume28
Issue number2
DOIs
StatePublished - 2006

ASJC Scopus subject areas

  • Agronomy and Crop Science
  • Economics and Econometrics

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