IMPORTANCE OR BENEFITS OF THE LAW OF EQUI-MARGINAL UTILITY
Law of Equi-Marginal Utility has an important place in economics. Even though it is highly criticized, its importance cannot be ignored. This applies in the every field of economics, which is clear from the following
Measurement of Utility
Utility is a Psychological and Personal Concept. There is a deference of opinion, whether measurement of utility can be done or not. Followings are the two approaches are prevalent in this regard.
Introduction to Micro Economics
In the present times, the study of economics is done from two viewpoints namely Micro and Macro. From the first viewpoint, the economic problems of various units, like – individuals, families, firms etc. are studied individually, whereas; from the second viewpoint, the same units of persons, families, firms etc., are studied in a combined form. Micro Economics is concerned with a specific, particular or an individual whereas; Macro Economics is concerned with a group.
The word micro means very small portion. From this point of view, micro economics is the study of specific economics units of the whole economy. Under this, a commodity, a consumer, a firm or an industry is studied individually.
Similarities Between The Definition Of Marshall And Robbins
The following similarities are found in the definitions Of Prof Marshall and Prof Robbins Continue reading
Introduction Of Robbins
Prof Lionel Robbins
Robbins definition of Economics challenged Dr. Marshall definition of Economics which was a major improvement over the definition of Adam Smith and other ancient Economists. Before Prof. Lionel Robbins, Prof. Marshall tried to give complete and faultless definition of economics. At that time people started thinking that the Economic Science has completely develop and matured. But in 1932, after the publication of Prof. Robbins’s book An Essay on the Nature and Significance of Social Science, a controversy roused in the field of Economics. He tried to give economics another shape, apart from material welfare. In the words of Robbins
Economics is the science which studies human behaviour as a relation between ends and scarce means which have alternative uses.
Criticism Of Marshall Definition
The Dr. Marshall definition of Economics is a major improvement over the definition of Adam Smith and other ancient Economists. This definition was recognized between 1890 to 1932 and it seemed that the controversy relating to the definition of Economics had ended. But, a renowned Professor of ‘London School of Economics’, Prof. Leonel Robbins in his book ‘An Essay of the Nature and Significance of Social Science’ in 1932 criticized Marshall’s definition in loud words, which are as follows – Continue reading
Economics is a science of choice making.
Introduction Of Marshall
Dr. Alfred Marshall
Marshall definition of Economics was first to challenge Adam Smith definition. Dr. Alfred Marshall (Born. 26 July, 1842, Died 13 July 1924) was the first Economist, who denied the wealth related definitions of Adam Smith, which was in vogue for a long time, in his two books published in 1890 named Principles of Economics and Economics of Industry, and declared them wrong, and defined it as not the study of human welfare. He gave, ‘Man’ the first place and Wealth’ as secondary and clarified that wealth is for man and man is not for wealth. Wealth is not the ‘End’, it is only a ‘Means’ to attain welfare. He presented the definition of Economics in this manner in his book ‘Economics of Industry’.
However Marshall definition was also criticized later by a renowned Professor of ‘London School of Economics’, Prof. Leonel Robbins in his book ‘An Essay of the Nature and Significance of Social Science‘ in 1932.