In the economy, utility is a measure of relative satisfaction. In other terms, it is a term that refers to the total satisfaction that a consumer experiences when consuming a good or service. Given this size, one can speak in a meaningful way about increasing or decreasing utility and thereby declare economic behavior in terms of attempts by the economic agent to increase his or her usefulness. Nut is often modeled as a unit that is influenced by consumption of different goods and services, possessing wealth and enjoying leisure.
The teaching of utilitarianism saw the maximization of utility as a moral criterion for the organization of society. According to utilitarians, such as Jeremy Bentham (1748-1832) and John Stuart Mill (1806-1873), society should strive to maximize the total usefulness of all individual members, with the goal of achieving "the greatest happiness for the largest number of people ". A recent theory, formulated around 1970 by John Rawls (1921-2002), stated that society should maximize the benefit of that individual who initially received the least amount of benefit. In both visions of usefulness, the liberal and social democratic views on society can be recognized, respectively.
Uses are usually used by economists in such constructions as the indifference curve. This plot the combination of goods, of which an individual or society accepts that it offers a certain level of satisfaction. Individual and social benefit can be constructed as the value of a utility and social welfare function, respectively. When combined with production or raw material constraints, these features can be used under certain assumptions to analyze Pareto efficiency, as illustrated by Edgeworth boxes in contract curves. Such Pareto efficiency is a key concept in the prosperity economy. Criticism on the utility concept
The term utility is a classical concept in the teaching material of the high school economy. Nut, however, is a controversial concept because it does not exist, it can not be measured. It is an abstract concept, which in a model of economic reality can explain the operation of certain economic processes in a simple way. Economists use it in models to predict or explain the behavior of rational acting agents. This can also be used without the concept, but the mathematical model is much more difficult to understand.
Set an agent derives an amount of utility from consuming certain goods, and suggest that the agent is rational, and set more is better, so that agent wants to maximize his utility. And then the constraints look around, such as market and technology, making choices. Economists insist that agents in the economy make rational choices, or that the behavior of agents is best predicted in a model based on rational choices. For example, the models of the CPB go out for that.
Non-rational considerations disturb the analysis used. The behavioral economists study the non-rational decision trees and try to describe them in a fashionable manner. Also see
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