Tuesday, October 8, 2019

The Influence of Marginalist Revolution in the Economy History Essay

The Influence of Marginalist Revolution in the Economy History - Essay Example (p. 14) As it was mentioned by one of the trendsetters of the movement, William Stanley Jevons: "The theory in question has in fact been independently discovered three or four times over and must be true" (cited in Hutchison, 1978). Let's name one more reason which would be grounded on the practical basis as developing of the viewing of the phenomenon of marginalist revolution provides us with an abundant source of theoretical assumptions which may be of great help while inciting up-to-date serves which are considered obscured or slighted by modern theory (Mirowski, 1988, p. 19). Moreover any uncertainty or confusion over the origins and results of marginalist revolution would give rise possible grave misunderstandings in its description and overviewing. Therefore, to try to explain the origin of the marginal utility revolution in the 1870's is doomed to failure: it was not a marginal utility revolution; it was not an abrupt change, but only a gradual transformation in which the old ideas were never definitively rejected; and it did not happen in the 1870s (Blaug, 1978, p. 322). Some authors challenge that there was any consolidated and deliberate movement. "In its stead, it portrays a haphazard and fragmented agglomeration of economic theorists, whose only common denominators were the twin notions of diminishing marginal utility and utility-determined prices"(Bowley 1973, p. 44). Moreover Bowley stated that none of the notions was especially new in the 1870s, we and may conclude that there was no interruption in the economic concepts of that time and the economic theory has realized one uninterrupted discipline from those time until nowadays (Bowley 1973, p. 49). Thus with the aim of proper investigation of the topic let's determine key fundamentals of marginalism. Briefly speaking it is the theory that determined economic value as a derivation from marginal utility and marginal cost which are considered to be basic marginal concepts. Through the prism of marginalism the most essential thing for the process of decision-making is "the marginal or last unit of consumption or production" (Hutchison, 1978, p. 91). For instance, one car is very helpful for everyday life. An additional car might become helpful if the first one is being repaired or for spares, but it is not as helpful as the first one. The third car has less utility than the previous two cars. Taking into consideration the price of cars, we may claim that many people are not inclined to own three cars as the benefit they are going to receive on the third automobile would be unlikely to go beyond the price (Verdon, 1996, p. 201). William Stanley Jevons from England, Carl Menger from Austria and Leon Walras from Switzerland singly formed the idea of marginal utility nearly in 1870. While discussing who of those three experts had taken the leading place in formulating the theory, Jevons' counterpart found a work of Prussian economist H. H. Gossen (Howey, 1960, p. 7). Gossen was considered as the initial author, and his work was restated using less mathematical methods in order to make it more comprehensible to the public. His relations between value in exchange and marginal utility

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