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How much do you need for happiness or the law of diminishing marginal utility

Club traders sMart-Lab. We make money on the exchange. 25.08.2020 at 12:55

Club traders sMart-Lab. We make money on the exchange. / RSS channel

Economists of the Marxist persuasion often put person a kind of voracious creature, they say him as little as do not let. There is a law of diminishing marginal utility. He says that each successive unit of the good in the General case, the individual has less benefit than the previous one. It works non-linear, for example, if you build a house you need 50 logs, 50-e is not less useful than the first.

In the case of money, the situation is similar if you're saving for something specific, say a $ 1000, 1000 dollar no less useful than the first. However, in General, with the growth of the state, you first meet the most urgent needs, then less and less urgent. That is, the law of diminishing marginal utility works just as well.

So how much do you need for happiness is difficult to determine because human needs are dynamic, but, of course, is the limit, when the remaining unmet needs will be extremely low.

is equal to this implies that as more money looks like a very reasonable risk reduction. However, often, in trading it is not. Probably because the process is very dynamic, do not always have time to think about it. How many times had when I look back and thought, "Well, what for!!! Also all yesterday was good, for what I risked?". But it was too late!

by the Way, exactly because of the law of diminishing marginal utility I don't believe in the conflicts between the politicians, billionaires and other "powers that be", consider them circus for suckers.

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