Home > Behavioural Economics > Diminishing Marginal Utility – not the case with chocolates!

Diminishing Marginal Utility – not the case with chocolates!

February 11, 2012 Leave a comment Go to comments

Many thanks to colleague Warren Baas for this article in the New Zealand Herald. After having just taught diminishing marginal utility to my A2 class, researchers have found that when you are down to your last chocolate you’ll find that it tastes better than those previously consumed. The textbooks state that as you consume an additional unit of output your utility (satisfaction) from each unit consumed will fall as more units are consumed – see the graph below.

The US researchers fed men and women five small chocolates of different flavours and asked them to rate their enjoyment of each as they ate it.

The flavours were given in different orders and some were told when they were on their last chocolate, while others were not given any warning.

Those that were pre-warned found the last sweet much more tasty than the others, the journal Psychological Science reports. Asked which chocolate was their favourite, those who knew when they were on their last chocolate plumped for that one 66 per cent of the time. University of Michigan researcher Ed O’Brien said: “Endings affect us in lots of ways and one is this ‘positivity effect’. It is something motivational. You think, ‘I might as well reap the benefits of this experience even though it is going to end’ or, ‘I want to get something good out of this while I still can’.”

Also knowing something is ending might make us more content. For example when an examiner finishes the 200th paper (and last of his quota) does he/she still mark the paper with the same focus as the first. Also is there an advantage in going last at a job intereview? These are further areas discussed in the article.

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