The ten scales obtained in this way are given in the following table:8
8The Roman numerals in the top line of the table are symbols designating the different commodities (or classes of commodities) consumed by a single individual. The successive figures down each vertical column represent successive additions to total satisfaction resulting from increased consumption of the designated
commodity.
Menger does not, however, explicitly name his independent variable at the outset, and the reader is left to find it for himself in the discussion that follows. At times, Menger states vaguely that the successive additions to total satisfaction are the result of successive “acts of satisfaction,” but later (p. 130) he makes
it clear that they are the result of successive equal additions to the quantity of the commodity consumed. This is not the end of the matter, however. In the paragraph following the table, Menger compares the figures of one column with those of another column when he argues that, after a fifth unit (?) of food has
been consumed, the individual of the table faces the fact that a sixth unit of food will give him less additional satisfaction than would be given by a first unit of tobacco, and that he must therefore bring his consumption of the two commodities into equilibrium. Such a comparison is not valid unless a unit of
tobacco and a unit of food are so defined that both are to be obtained with an equal expenditure of some other resource (such as labor or money), since otherwise the two units would not constitute alternatives between which the individual must choose.
A minimum model meeting Menger’s discussion requires, therefore, the following assumptions:
(1) The economizing individual of the table is able not only to rank his satisfactions but also to assign cardinal indices to their relative degrees of importance. In other words, he is able to compare different satisfactions in terms of a homogeneous unit of satisfaction. (See also the summary of principles on p. 139 and the discussion in Ch. IV, Sec. 2.)
Suppose that the scale in column I expresses the importance to some one individual of satisfaction of his need for food, this importance diminishing according to the degree of satisfaction already attained, and that the scale in column V expresses similarly the importance of his need for tobacco. It is evident that satisfaction of his need for food, up to a certain degree of completeness, has a decidedly higher importance to this individual than satisfaction of his need for tobacco. But if his need for food is already satisfied up to a certain degree of completeness (if, for example, a further satisfaction of his need for food has only the importance to him that we designated numerically by the figure 6), consumption of tobacco begins to have the same importance to him as further satisfaction of his need for food. The individual will therefore endeavor, from this point on, to bring the satisfaction of his need for tobacco into equilibrium with satisfaction of his need for food. Although satisfaction of his need for food in general has a substantially higher importance to the individual in question than satisfaction of his need for tobacco, with the progressive satisfaction of the former a stage nevertheless comes (as is illustrated in the table) at which
further acts of satisfaction of his need for food have a smaller importance to him than the first acts of satisfying his need for tobacco, which although less important in general is at this stage still wholly unsatisfied.
By this reference to an ordinary phenomenon of life, I believe I have clarified satisfactorily the meaning of the numbers in the table, which were chosen merely to facilitate demonstration of a difficult and previously unexplored field of psychology.
(2) The satisfaction from the consumption of each commodity is independent of the amount of consumption of other commodities.
(3) Successive additions to total satisfaction in each vertical column are the result of successive equal additions to the amount of the commodity consumed.
(4) Additional amounts of the different commodities are all to be obtained by the individual with an equal expenditure of some other resource.-TR.
The varying importance that satisfaction of separate concrete needs has for men is not foreign to the consciousness of any economizing man, however little attention has hitherto been paid by scholars to the phenomena here treated. Wherever men live, and whatever level of civilization they occupy, we can observe how economizing individuals weigh the relative importance of satisfaction of their various needs in general, how they weigh especially the relative importance of the separate acts leading to the more or less complete satisfaction of each need, and how they are finally guided by the results of this comparison into activities directed to the fullest possible satisfaction of their needs (economizing). Indeed, this weighing of the relative importance of needs-this choosing between needs that are to remain unsatisfied and needs that are, in accordance with the available means, to attain satisfaction, and determining the degree to which the latter are to be satisfied- is the very part of the economic activity of men that fills their minds more than any other, that has the most far-reaching influence on their economic efforts, and that is exercised almost continually by every economizing individual. But human knowledge of the different degrees of importance of satisfaction of different needs and of separate acts of satisfaction is also the first cause of differences in the value of goods.
Taken From : PRINCIPLES OF ECONOMICS
