As defined by the

Austrian School of economics The Austrian School is a heterodox school of economic thought that advocates strict adherence to methodological individualism, the concept that social phenomena result exclusively from the motivations and actions of individuals. Austrian school ...

the marginal use of a good or service is the specific use to which an agent would put a given increase, or the specific use of the

good In most contexts, the concept of good denotes the conduct that should be preferred when posed with a choice between possible actions. Good is generally considered to be the opposite of evil and is of interest in the study of ethics, morality, p ...

or service that would be abandoned in response to a given decrease.von Wieser, Friedrich; ''Über den Ursprung und die Hauptgesetze des wirtschaftlichen Wertes'' /nowiki>''The Nature and Essence of Theoretical Economics''/nowiki> (1884), p. 128. The useful''ness'' of the marginal use thus corresponds to the

marginal utility In economics, utility is the satisfaction or benefit derived by consuming a product. The marginal utility of a good or service describes how much pleasure or satisfaction is gained by consumers as a result of the increase or decrease in consumpti ...

of the good or service.Mc Culloch, James Huston
“The Austrian Theory of the Marginal Use and of Ordinal Marginal Utility”
''

Zeitschrift für Nationalökonomie ''Journal of Economics'', founded as ''Zeitschrift für Nationalökonomie'', is an academic journal of economics with an emphasis on mathematical microeconomic theory, although it publishes occasional articles on macroeconomics. ''Zeitschrift für ...

'' 37 (1977) #3&4 (September). On the assumption that an agent is economically rational, each increase would be put to the specific, feasible, previously unrealized use of greatest priority, and each decrease would result in abandonment of the use of lowest priority amongst the uses to which the good or service had been put. And, in the absence of a complementarity across uses, the “law” of diminishing marginal utility will obtain. Georgescu-Roegen, Nicholas; “Utility”, ''International Encyclopedia of the Social Sciences'' (1968). The Austrian School of economics explicitly arrives at its conception of marginal utility as the utility of the marginal use, and “Grenznutzen” (the Austrian School term from which “marginal utility” was originally derived in translationStreissler, E., “Wieser, Friedrich, Freiherr von”, The New Palgrave: A Dictionary of Economics, v. 4 (1987), p. 921.) literally means ''border-use''; other schools usually do not make an explicit connection.

References

{{reflist, 1 Marginal concepts Consumer theory Utility Austrian School

See also

References