Essentials of Economic Theory: As Applied to Modern Problems of Industry and Public PolicyClark, John Bates
General
Essentials of Economic Theory: As Applied to Modern Problems of Industry and Public Policy
Clark, John Bates
Economics
Even the monopoly is able
to get different prices for different parts of its output only by
offering them at different times; and competing producers cannot do
this. They are forced to keep the price of all they offer at a level
that expresses its final utility.
_The Law of Value affected by the Difficulty of using Two Similar
Goods at Once._--There are two imperfections in the common statement
of this law of final utility which need to be removed in order that
the theory of value, which is based on the law, may be true and
useful. The first lies in the assumption that people buy completed
articles, such as coats, tables, vehicles, watches, etc., in regular
series of units, adding to their stock coat after coat, watch after
watch, etc., all just alike, till the utility of the last one becomes
so small that it is better to buy other things. On this supposition
the price of the whole supply of any such thing corresponds with the
utility of the last one in the consumer's series. This fairly well
describes the case of commodities like apples, of which men consume
now more and now less per day or per week and are always glad to
increase the amount they use. Of most kinds of consumers' goods a
person wants at one time one unit and no more, and a second unit, if
he has to use it himself within the same time in which he uses the
first, would be an incumbrance. Its utility would be a negative
quantity. Two quite similar coats would never be bought by the same
person if he had only his own needs in view and must use both coats
through the same period. The first unit of his supply is, for this
period, also the last.
Public-domain text, read in full here on John Shaqi.
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