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To maximize utility is to maximize wealth
送交者: jingchen 2022年02月19日07:40:33 于 [教育学术] 发送悄悄话

To maximize utility is to maximize wealth

 

In standard economic theory, people are supposed to maximize their utilities. Economic value is defined as marginal utility. Hence, from the standard economic theory, people are supposed to make as much money as possible. Isn’t that a simpler and more intuitive statement? Why make the roundabout statement about utility?

 

There could be two reasons. By talking about utility instead of money directly, economic theory sounds more sophisticated. By stating that the pursuit of money enhances utility, money making sounds noble.  


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