Thursday, September 17, 2009

Diminishing Marginal Utility

I bought a new laptop recently. An absolute masterpiece- The Dell Studio15. As I laid my hands on it, all excited, the sight was as though a child was playing with a new toy for the first time, handling it extremely carefully, literally not allowing anyone else to touch it but only see it from a distance.

This is basic human psychology I  guess. Every new possession is handled with care, while the old ones are lying somewhere unnoticed & uncared for, biting the dust. The economic jargon used to describe this behaviour is called ‘The Law of Diminishing Marginal Utility’. (Read it here - http://www.investopedia.com/terms/l/lawofdiminishingutility.asp). The only material exception to this principle that i can think of is a Car. People usually develop sentiments & are highly passionate about their cars and don’t let them go easily, unless absolutely necessary. But this certainly does not deter them or rob them of the excitement of the new car they purchase.

Hmm…I know she’ll grow old, someday. And then I'll lose interest in her, eventually dumping her without any regrets. Then the hunt would begin for my next laptop with the same excitement & passion as this time. 

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