On Wed, Mar 11, 2026 at 02:46 PM, Charles wrote: > > Marginal utility with its mythological consumer preference curves is a > laughable alternative to the labor theory of value.
As I recall, Bukharin in his Economic Theory of the Leisure Class was pretty harsh on the notion of marginal utility, which was not at all a well-defined concept at that time. Bourgeois economists ranging from Vilfredo Pareto to Paul Samuelson would make attempts to put the concept on a more rigorous basis. It is interesting to note that the development of marginal utility theory in the late 19th century introduced a then novel approach for understanding economic value, emphasizing the diminishing satisfaction derived from additional units of a good. Some of its early proponents suggested that this insight could justify income redistribution, (and even socialism itself) arguing that transferring wealth from high-income to low-income individuals would yield a net gain in utility: the loss in satisfaction for the rich would be smaller than the gain for the poor. This idea, however, was sharply critiqued by Vilfredo Pareto, who argued that interpersonal comparisons of utility are not scientifically valid. By Pareto’s logic, not only can utility not be compared across individuals, but any claim of measuring an individual’s utility over time also lacks objective grounding, making such redistribution arguments non-scientific, though not necessarily unethical. Later economists, such as Joan Robinson, extended these critiques from a more practical standpoint. Robinson argued that marginal utility curves are heuristic models rather than precise tools, noting that real-world preferences are shaped by social, institutional, and behavioral factors that cannot be fully captured by a simple downward-sloping curve. She also rejected the cardinal measurement of utility, preferring an ordinal approach that respects the subjective ranking of choices without asserting precise numerical values. Her work highlighted that price and distribution in markets are influenced by imperfect competition, cost structures, and institutional realities, rather than abstract marginal calculations. >From a Marxist perspective, Paul Cockshott further criticized marginal utility >theory as ideologically biased and unnecessary. He emphasized that value >arises from socially necessary labor, not from individual satisfaction, and >that marginalist assumptions — perfect information, rational choice, and >infinitely divisible goods — are unrealistic. Cockshott argued that planned >socialist economies can allocate resources according to labor inputs and >social needs without appealing to marginal utility, underscoring its >limitations as a guide for real-world economic policy. Taken together, these >critiques reveal the conceptual and practical limits of marginal utility >theory: it is a useful analytical device, but it cannot provide scientifically >rigorous prescriptions for social welfare, pricing, or redistribution. Sidney Hook was certainly aware of many of the criticisms of marginal utility theory when he wrote Towards the Understanding of Karl Marx. He recognized Pareto’s objection that interpersonal comparisons of utility are scientifically invalid, which undermined the notion that income redistribution could be justified purely on marginal utility grounds. Hook also understood the concerns later emphasized by Joan Robinson regarding the limitations of marginal utility curves, including their reliance on unrealistic assumptions about individual preferences, perfect information, and market conditions. In his work, Hook treated marginalist insights as useful formal tools for understanding choice and pricing, but he emphasized that Marx’s labor-value framework provided a more socially grounded account of production, exchange, and distribution, one that could not be reduced to abstract calculations of individual satisfaction. In this way, Hook navigated between the formal rigor of marginalist theory and the social reality highlighted by Marx, showing a sophisticated appreciation of the methodological limits of marginal utility. -=-=-=-=-=-=-=-=-=-=-=- Groups.io Links: You receive all messages sent to this group. View/Reply Online (#41097): https://groups.io/g/marxmail/message/41097 Mute This Topic: https://groups.io/mt/118257263/21656 -=-=- POSTING RULES & NOTES #1 YOU MUST clip all extraneous text when replying to a message. #2 This mail-list, like most, is publicly & permanently archived. #3 Subscribe and post under an alias if #2 is a concern. #4 Do not exceed five posts a day. -=-=- Group Owner: [email protected] Unsubscribe: https://groups.io/g/marxmail/leave/13617172/21656/1316126222/xyzzy [[email protected]] -=-=-=-=-=-=-=-=-=-=-=-
