I Hated Math! BUT It's Actually Kinda Cool!

Ever since I can remember I’ve had a particular interest in economics. Last year I dove deeper into the field by taking a political economy class. The semester before that I took a microeconomics class. After taking those classes I realized that I appreciated the math that I could physically see making a difference in the world, Fairbanks and even personally. One of the concepts that I really took a liking to was the idea of diminishing returns also known as “The Law of Diminishing Marginal Utility”.

The Law of Diminishing Marginal Utility is a concept within economics that is directly related to personal consumption of a product. The law dictates that the consumption of other products will be kept at a constant. A common phrase in economics is "ceteris paribus" which means “holding other things constant”. Some economists believe that the law of diminishing marginal utility plays a crucial role in determining that socialism is far worse than capitalism. The Law of Diminishing Marginal Utility was developed by Carl Menger, and is axiomatic. It is known to be dependent on psychology.

The marginal utility of a good or service is the amount gained from an increase or loss from a decrease in the intake of that particular good or service. In theory the first unit consumed will yield higher “Utility” than the one after it and so forth. Utility is the amount of satisfaction someone will receive from consuming a good. Economics is unique in the sense that economists like to measure pretty much everything and in this case we are looking at satisfaction. When we are measuring utility we use utils to determine satisfaction.

An example we could use to show this is would be eating pizza—My satisfaction after the first slice is really high, the second one is also high, the third drops, and then after that I start to become full and my satisfaction after each slice diminishes. We can relate utility to a variety of different examples but I rather enjoyed learning about how we calculate it. It’s difficult to come up with specific numbers because we can’t know for sure how much each individual wants something, but what we can do is look at when the want starts to peak. This law opens the door to a variety of different concepts of math such as graphing, formulas, measurements and much more. I love these concepts because I think it allows us to measure a variety of different psychological and sociological applications that we may expose ourselves with. I think that with the proper study and with the implantation of the law of diminishing marginal returns we can study habits and what pleasure comes from these habits and when a habit starts to become destructive to us. We can look at our lives and figure out what we enjoy and what we are exposing ourselves to, but what happens when we are tired of hearing the same thing over and over again.

I’ve been trying to dive deeper into this and apply it to my own life. If we are consuming a product or exposing ourselves to something we perceive as good why do we keep consuming it or exposing ourselves to it when it no longer is pleasurable. Isn’t it fascinating that we can actually better our lives by using economical laws and theories that seek to reduce the scarcity of time and costs? We utilize math in economics to find the optimal costs, the optimal product, and even optimal times.

My research on the Law of Diminishing Marginal Utility has helped me to look at life in a more mathematical way and I feel like it’s, in a sense, reduced the amount of anxiety I originally had towards math in general. In my personal opinion we can find ideal ways of living and calculate pretty much anything with the combination of mathematical laws, habits and psychology. What if we could mathematically determine how effective a workout is on muscle growth and reduction and set specific goals knowing that we can hit our specific mark. I know I’m going on a bit of a tangent here but I’m really inspired as to how I can take math and relate it to my personal life.

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