422 AGRICULTURAL ECONOMICS 



person derives from a given increase of his stock of a thing diminishes 

 with every increase in the stock that he already has. 



That part of the thing which he is only just induced to purchase 

 may be called his marginal purchase, because he is on the margin of 

 doubt whether it is worth his while to incur the outlay required to 

 obtain it. And the utility of his marginal purchase may be called the 

 marginal utility of the thing to him. Or, if instead of buying it he 

 makes the thing himself, then its marginal utility is the utility of 

 that part which he thinks it only just worth his while to make. And 

 thus the law just given may be worded: 



The marginal utility of a thing to anyone diminishes with every 

 increase in the amount of it he already has, supposing no time to be 

 allowed for any alteration in the character or tastes of the man him- 

 self. It is therefore no exception to the law that the more good music 

 a man hears, the stronger is his taste for it likely to become; that 

 avarice and ambition are often insatiable; or that the virtue of cleanli- 

 ness and the vice of drunkenness alike grow on what they feed upon. 

 For in such cases our observations range over some period of time; 

 and the man is not the same at the beginning as at the end of it. If 

 we take a man as he is, without allowing time for any change in his 

 character, the marginal utility of a thing to him diminishes steadily 

 with every increase in his supply of it. 



Now let us translate this law of diminishing utility into terms of 

 price. Let us take an illustration from the case of a commodity, such 

 as tea, which is in constant demand and which can be purchased in 

 small quantities. Suppose, for instance, that tea of a certain quality 

 is to be had at 25. per pound. A person might be willing to give los. 

 for a single pound once a year rather than go without it altogether; 

 while if he could have any amount of it for nothing he would perhaps 

 not care to use more than 30 pounds in the year. But as it is, he buys 

 perhaps 10 pounds in the year; that is to say, the difference between 

 the happiness which he gets from buying 9 pounds and 10 pounds is 

 just enough for him to be willing to pay 2s. for it, while the fact that 

 he does not buy an eleventh pound, shows that he does not think that 

 it would be quite worth an extra 2s. to him. That is, 25. a pound 

 measures the utility to him of the tea which lies at the margin or 

 terminus or end of his purchases; it measures the marginal utility to 

 him. If the price which he is just willing to pay for^any pound be 

 called his demand price, then 25. is his marginal demand price. 

 And our law may be worded: 



