Wednesday, July 02, 2008

Yes, the first derivative of utility function with respect to that thing you consume is positive and the second one is negative

From Murakami's A Wild Sheep Chase.

She nodded. She put the letters in her bag, which she fastened with a snap of the clasp. I lit up a second cigarette and ordered another whiskey. The second whiskey is always my favorite. From the third on, it no longer has any taste. It's just something to pour into your stomach.

In other words, du/dw = u' > 0 and u" < 0. The law of diminishing marginal utility, q.e.d.

1 comment:

  1. oh murakami. never read him, but i read his article in the new yorker ("the running novelist"-just google it) and it's so cool.