Economic essays

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Monograph

Identifikator:: 1753623200

URN:: urn:nbn:de:zbw-retromon-136107

Document type:: Monograph

Title:: Economic essays

Place of publication:: New York

Publisher:: Macmillan

Year of publication:: 1927

Scope:: viii, 368 S.; Ill., graph. Darst.

Digitisation:: 2021

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: A statistical method for measuring "marginal utility" and testing the justice of a progressive income tax / Irving Fisher

Collection:: Economics Books

A STATISTICAL METHOD FOR MEASURING ‘MARGINAL UTILITY’ 159 The private account books, . . . are all full. . . . But it is chiefly a want of method and completeness in this vast mass of informa- tion which prevents our employing it in the scientific investiga- tions of the natural laws of Economics.” * It has long seemed to me that just such records of consumption as Jevons mentioned ought, on proper analysis, to yield a real statistical measurement of this most elusive of magnitudes. If this cannot yet be done for the individual, or even for the individual family, it may be that it can be done for a “typical” family, an imaginary family, consisting of a given number of people and having a given income. That is to say, we may possibly be able to make use of mass statistics somewhat as the physicist measures the pressure of a gas without measuring the impulses of individual molecules, though it is really the bombard- ment of these against the containing walls which really consti- tutes the gaseous pressure. We can often gauge a mass effect when we cannot gauge its constituent parts. As my old master in mathematical physics, J. Willard Gibbs, used to say, “The whole is simpler than its parts.” The records from which I hope we may succeed in distilling out the desired psychological essense, the want-for-one-more, are (1) retail prices, and (2) family budgets. Through such mass sta- tistical measurements we may succeed in gauging average or typical human emotions even better than any individual who feels them, just as a clever editor, or advertiser, or salesman, knows what the mass of people want better than any person in that mass itself. Specifications Re Budgets and Prices The method consists, in a word, of so utilizing data of family budgets and prices as to compare the wants of two typical families of different incomes, in the same community, by using as a yard- stick or criterion, a third typical family having identical tastes, but differing in the amount of income, and living under a different scale of prices for foods, rents, clothing and other items of consumption. Let us, then, imagine three typical workingmen’s families, each consisting, say, of five people, the man himself, his wife, and three typical children. 2 0p. Cit. pp. 10, 11.

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