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Marshiro
Posted - 2010.10.12 20:47:00 - [1]
 

You can never have enough money, so says the economist, but is this really true?

One of the most fundamental assumptions of economists is that the marginal utility value of overall wealth can not be negative. However, in eve, we can see that is very obviously not true, as SISI is not some heaven of infinite happiness but a very boring place. The classical assumption that more wealth = more happiness probably remains in a microeconomic sense, but false in the macroeconomic one.

So what exactly is the best proxy for measuring the amount of satisfaction derived out of the economy? Just what kind of economic situation result in the happiest eve gamers? Low Gini? Uncomputable? Irrelevant?

Takakura Hirohito
Posted - 2010.10.12 20:53:00 - [2]
 

Yes.

SyroPinus
Posted - 2010.10.12 21:16:00 - [3]
 

I approve of this product and/or service.

Estel Arador
Posted - 2010.10.12 21:27:00 - [4]
 

Originally by: Marshiro
The classical assumption that more wealth = more happiness probably remains in a microeconomic sense


That assumption has been proven wrong. Any positive effect of an increase in wealth on happiness is temporary at best*; people get used to their increased wealth very quickly.


*This applies once a certain threshold of wealth has been passed; if you're below subsistence level an increase in wealth will make you more happy.

Astald Ohtar
AtlantiA French Corp
Yulai Federation
Posted - 2010.10.12 21:27:00 - [5]
 

feeling that you are better than most others? or that you are doing pretty well ? buying 100isk ship everyone can do that, so achieving a social status may be?
seeing how homeless/poor people in other countries live should makes you happy, well at least you aren't suffering as they do , but when you start comparing your life with rich people's life you start getting depressed.
thus happiness should be irrelevant to all materialistic things.

Netherthinker
Posted - 2010.10.12 21:36:00 - [6]
 

Personally, the fun I get from the market is pretty all from manipulating numbers and trying to push the benefits. The wallet isn't that important, excepted it allows you to place more orders. The summit would be to push the benefits to 2B+ a day with alts on each hub.

ForumWarrior
Posted - 2010.10.12 21:58:00 - [7]
 

Money can't buy happiness, true.

But it can rent most of it.

Mme Pinkerton
The pink win
Posted - 2010.10.13 05:39:00 - [8]
 

2 common ideas (without providing citations):

(1) Being richer than your neighbor makes you more happy - it's not so much about being rich in absolute terms.

(2) The rate of change is more important with rgds to happiness than the absolute level of wealth.


Low Gini => boring game

Extremely High Gini => OMG I am never gonna catch up! Supercapitals Online! RAGEQUIT

Lederstrumpf
Posted - 2010.10.13 15:42:00 - [9]
 

Edited by: Lederstrumpf on 13/10/2010 15:43:41
Originally by: Mme Pinkerton
2 common ideas (without providing citations):

(1) Being richer than your neighbor makes you more happy - it's not so much about being rich in absolute terms.

(2) The rate of change is more important with rgds to happiness than the absolute level of wealth.



I do agree. It's interesting that more people seem to prefer to become richer than the rest, than to have all become rich.

Might it be simply caused by human survival instinct? "If I do own twice the money he does there's a higher chance I, not him, might survive a food shortage!". In the real world this behavior could be seen as the reason why the "first world" citizens seem to have some problems helping out the "third world" citizens. In EVE you could see it as probability to be able to afford a PLEX: "Will it be me or him not being able to play anymore once the PLEX price breaks the 1b barrier?"


Mme Pinkerton
The pink win
Posted - 2010.10.13 17:27:00 - [10]
 

Edited by: Mme Pinkerton on 13/10/2010 17:28:47
Originally by: Lederstrumpf
[In the real world this behavior could be seen as the reason why the "first world" citizens seem to have some problems helping out the "third world" citizens.

I remember reading an article contradicting that hypothesis (at least on the scale of whole continents):
the authors had tested the relation between personal well-being/satisfaction/happiness (one of the problems with "happiness"-research is that the closest translations of it in various languages differ wildly in their connotations) and income relative to peers among people in some developing country and found a significant relationship.

However, the consume of US soap operas did not significantly affect the perceived well-being - despite these TV shows confronting their viewers with a vastly higher standard of living than common in their own social environment (so one might have expected that their consumption might increase envy).

This was interpreted as showing that only wealth relative to a fairly close environment matters for happiness.

Sadly, I cannot find the source of that experiment...

For contrast here's a paper that comes to the conclusion that these social comparison effects are not likely to matter.
(paper has been selected from some old reading list I found in my emails, no ide how important/influential it is)

random stuff:

if you want to know why EVE players are always so unhappy (just have a look at GD^^): look here

"A house may be large or small; as long as the surrounding houses are equally small it satisfies all social demands for a dwelling. But if a palace rises beside the little house, the little house shrinks into a hut" (Karl Marx)

SencneS
Rebellion Against Big Irreversible Dinks
Posted - 2010.10.13 18:22:00 - [11]
 

The reason SISI isn't a the happiest place in EVE is because at a moments notice it can be deleted. Anything that you work for is instantly lost with no hope of recovery.. EVE's production server's data overwrites SISI occasionally making every form of achievement on SISI null and void. You have to do the same thing on both servers in order for it to remain on SISI, which may not be possible or even achievable. Why do things twice when all that really matters is doing on the Primary site.

Imagine the world in a similar situation in which humanity would have endless free resources, building up everything and doing whatever they wanted whenever, but at a moments notice our Alien Overlords comes and erases every single structure we establish, then says "OK here you go, endless resources again, and it's all FREE!!" - Not exactly a utopia..

cyndrogen
Posted - 2010.10.13 18:36:00 - [12]
 

Originally by: SencneS
The reason SISI isn't a the happiest place in EVE is because at a moments notice it can be deleted. Anything that you work for is instantly lost with no hope of recovery.. EVE's production server's data overwrites SISI occasionally making every form of achievement on SISI null and void. You have to do the same thing on both servers in order for it to remain on SISI, which may not be possible or even achievable. Why do things twice when all that really matters is doing on the Primary site.

Imagine the world in a similar situation in which humanity would have endless free resources, building up everything and doing whatever they wanted whenever, but at a moments notice our Alien Overlords comes and erases every single structure we establish, then says "OK here you go, endless resources again, and it's all FREE!!" - Not exactly a utopia..


The appeal of SIN, is the endless tweakability without rISK to your wallet divisions. On SIN I can make 1 billion by losing 2 insured obelisk ships. In fact the best way to make ISK is to let other players gank you.
I learned how long an obelisk would survive against supercarriers, battlecruisers and t3 ships and this would have cost me so much more on tranquility to learn.

I think SIN is fantastic as a way to test fittings, try modules that are too expensive and mess around with plugins that you would not be able to afford since everything is 100ISK. Also it's a great way to learn how to manufacture because you don't need to mine anything, you simply buy a few Ravens and reprocess them for minerals.

Sin is the best way to learn how to play eve without spending months of mining to try something you might not even like to do.

After trying setting up a POS on SIN I decided to not invest time or ISK on getting one on tranquility because it simply is too much maintenance, even if the rewards are great, I'm a casual player and I simply don't have time for running a POS.

Covert Kitty
Amarr
SRS Industries
SRS.
Posted - 2010.10.13 19:56:00 - [13]
 

Fundamentally wealth is a measurement of ones influence over others time/behaviour. Currency makes complex trades over time managable whereas a simple barter system only works in an immediate manner between few people. Attempting to draw financial/power conculsions from SiSi is fairly pointless since it has almost no population nor is there a need for interaction.

Gabriel Virtus
hirr
Posted - 2010.10.15 07:49:00 - [14]
 

Edited by: Gabriel Virtus on 15/10/2010 07:51:48
You made a few errors.

1) whether or not more money makes you more happy is irrelevent to a negative utility function where money is one of the variables. There is a difference between a marginal utitility of zero and a negative marginal utility. utility != happiness.

Sisi isn't fun because there is no scarcity; scarcity is a base assumption in most in economic analysis. Without scarcity, there is no pressure for any action whatsoever.

Eve Gamers have different utility functions and therefore each one would probably have a different cirucumstance where they would be the most happy.

-GV

edit: lol @ most of these responses.

JitaPriceChecker2
Posted - 2010.10.15 08:52:00 - [15]
 

Edited by: JitaPriceChecker2 on 15/10/2010 08:54:03

Ghoest
Posted - 2010.10.15 10:11:00 - [16]
 

Contrary to pop culture scientific tests have shown that rich people are happier than average wealth people. And everyone is happier than poor people.

That said in EVE its making the money thats fun.

Jimnoo
Posted - 2010.10.15 10:34:00 - [17]
 

Edited by: Jimnoo on 15/10/2010 10:36:04
Originally by: Marshiro
One of the most fundamental assumptions of economists is that the marginal utility value of overall wealth can not be negative.


Even trying to read this in as positive light as possible, this is just false. I presume that you mean that the marginal utility of an increase in total wealth (of an individual) cannot be negative. This is empirically false in some situations (e.g. unhappy lottery winners). Also, why would any economic model need to make this an assumption?

Nefrums
Posted - 2010.10.15 10:36:00 - [18]
 

Edited by: Nefrums on 15/10/2010 10:37:52
This is a well known fact and it has been proven time and again that money have no value in itself, it is only a representation of the value of everything else.

The total value of all money will not increase if you print more money. The only thing that will happen is that the value of a unit of money will decrease. Many countries have tried to take the easy way out by printing more money resulting in a decrease in the value of individual units of money, this is called inflation.

To increase the value of the total money you will have to produce more products and services and hence increase the value of the general wealth, witchs in return increases the value of all money.

In SISI everything is "free" so money is not a representation of the value of everything else, hence money have no value.


Ash Donai
Minmatar
Kanu Industries
Posted - 2010.10.15 15:39:00 - [19]
 

Originally by: Marshiro
So what exactly is the best proxy for measuring the amount of satisfaction derived out of the economy? Just what kind of economic situation result in the happiest eve gamers? Low Gini? Uncomputable? Irrelevant?

Simple: The amount of satisfaction derived out of the economy is equal or larger than $15/month * the number of accounts you sustain.

Gabriel Virtus
hirr
Posted - 2010.10.16 09:58:00 - [20]
 

Originally by: Nefrums
Edited by: Nefrums on 15/10/2010 10:37:52
This is a well known fact and it has been proven time and again that money have no value in itself, it is only a representation of the value of everything else.


This is hardly a proven fact in any sense of the word. Money has value in and of itself, mostly due to value of money changing frequently. You might want to update your views past the 1920s.

-GV

Gabriel Virtus
hirr
Posted - 2010.10.16 10:00:00 - [21]
 

Originally by: Jimnoo
Edited by: Jimnoo on 15/10/2010 10:36:04
Originally by: Marshiro
One of the most fundamental assumptions of economists is that the marginal utility value of overall wealth can not be negative.


Even trying to read this in as positive light as possible, this is just false. I presume that you mean that the marginal utility of an increase in total wealth (of an individual) cannot be negative. This is empirically false in some situations (e.g. unhappy lottery winners). Also, why would any economic model need to make this an assumption?


fallacy; Because a lotto winner is unhappy does not mean that their unhappiness was caused by winning the lottery. There is a difference in marginal utility of an increase in wealth and a marginal utility function - which cannot be negative. The function is an assumption, not what you stated.

-GV

Jimnoo
Posted - 2010.10.16 13:31:00 - [22]
 

Edited by: Jimnoo on 16/10/2010 13:32:02
Originally by: Gabriel Virtus
fallacy; Because a lotto winner is unhappy does not mean that their unhappiness was caused by winning the lottery


I wasn't using the unhappy lottery winner as proof that the marginal utility of an increase in wealth, just as an example. Don't you agree that it is possible that increased wealth can reduce happiness in reality? (Clearly it couldn't if the agents were pefectly rational becuase they could just give it away. But people aren't perfectly rational.)

Originally by: Gabriel Virtus
a marginal utility function - which cannot be negative. The function is an assumption, not what you state.


I am geniunely trying to understand what you mean by a marginal utility function. I presume is is a mathemetical function that relates marginol utility to wealth. Why would you *assume* this can't be negative?

Note that economic models have assumptions, there aren't universal assumptions of economics. Different economists and different schools of thought use different models with different assumptions. At the start of your study of economics you might be told some assumptions - they are not set in stone. In maths class at school I calculated the trajectory of cannonballs, assuming no air resistance. I wouldn't claim that maths assumes no air resistance.


Gabriel Virtus
hirr
Posted - 2010.10.16 14:42:00 - [23]
 

Originally by: Jimnoo

I wasn't using the unhappy lottery winner as proof that the marginal utility of an increase in wealth, just as an example. Don't you agree that it is possible that increased wealth can reduce happiness in reality? (Clearly it couldn't if the agents were pefectly rational becuase they could just give it away. But people aren't perfectly rational.)

First, why would you cite an example that doesn’t show what you are claiming? The problem with this analysis is that there can be many causes for the result, while you are claiming only one of them. I do not agree that increased wealth will reduce happiness, I think it might have zero effect on happiness, but to claim a negative value in a utility function the money variable seems quite farfetched to me. If people are not rational – as the number one assumption of economics – than economic analysis means nothing.

Originally by: Jimnoo

I am geniunely trying to understand what you mean by a marginal utility function. I presume is is a mathemetical function that relates marginol utility to wealth. Why would you *assume* this can't be negative?

It is a function ( e.g., 13.123x + 3412x^2 = y for a simple quadratic one). It generally measures the utility gained from different sources. As you gain wealth, your marginal utility for each extra dollar generally goes down. However, it is accepted that a negative value for this variable – money – does not happen. Why would anyone be less happy with more money? A value of zero is not negative and certainly possible, but a negative value simply doesn’t happen. The only example I could think of is gaining wealth that has substantial costs to the person to cause them unhappiness, but these would be assessed in other variables.

People simply would stop gaining if it would ever be negative. Once it equals zero, they would stop trying whatsoever or simply refuse any more of it.
Originally by: Jimnoo

Note that economic models have assumptions, there aren't universal assumptions of economics. Different economists and different schools of thought use different models with different assumptions. At the start of your study of economics you might be told some assumptions - they are not set in stone. In maths class at school I calculated the trajectory of cannonballs, assuming no air resistance. I wouldn't claim that maths assumes no air resistance.


The same general marginal utility functions are quite standard for all areas of economic analysis. It is sort of the framework that theories are built on. Variables change, but these have little significance. The last sentence is rather ridiculous and not analogous whatsoever.

-GV

Jimnoo
Posted - 2010.10.16 17:06:00 - [24]
 

This has become an economics ****ing match. I'll indulge myself in one last reply.

Originally by: Gabriel Virtus
If people are not rational – as the number one assumption of economics – than economic analysis means nothing.


The point you don't get is that economics isn't a single model, with a fixed set of assumptions. There is a very healthy debate in economics about exactly this issue of rationality. Economics students, working on a particular problem set might assume simple utility maximising rationality, but that doesn't mean that economists do. Let me point you at three areas of mainstream economics which don't assume perfact rationality:

  1. Expectations: Do people set expectations rationally according to models (Rational Expectations) or more heuristically.


  2. Bounded rationality


  3. Behavioral Economics - one of the hottest topics in research at the moment.

Gabriel Virtus
hirr
Posted - 2010.10.16 22:33:00 - [25]
 

This is no ****ing match, more of a "I try to teach and you fail at listening - or reading" match. You give yourself too much credit.

Originally by: Jimnoo
This has become an economics ****ing match. I'll indulge myself in one last reply.

Originally by: Gabriel Virtus
If people are not rational – as the number one assumption of economics – than economic analysis means nothing.


The point you don't get is that economics isn't a single model, with a fixed set of assumptions. There is a very healthy debate in economics about exactly this issue of rationality. Economics students, working on a particular problem set might assume simple utility maximising rationality, but that doesn't mean that economists do. Let me point you at three areas of mainstream economics which don't assume perfact rationality:

  1. Expectations: Do people set expectations rationally according to models (Rational Expectations) or more heuristically.


  2. Bounded rationality


  3. Behavioral Economics - one of the hottest topics in research at the moment.



Cute reply. You should point to the part of my post where I claimed perfect rationality was an assumption of economic analysis. Before you go on a linking rant, you should try to read my post in the first place. Although I do think links in general give posts a more legitimate look.

Do you understand the difference between the terms "not rational" and "not perfectly rational"? Browse over wikipedia or google-search a few more things and come back if you like.

-GV

RAW23
Posted - 2010.10.17 07:01:00 - [26]
 

Edited by: RAW23 on 17/10/2010 07:22:05
Edited by: RAW23 on 17/10/2010 07:07:01
Originally by: Gabriel Virtus
This is no ****ing match, more of a "I try to teach and you fail at listening - or reading" match. You give yourself too much credit.

Originally by: Jimnoo
This has become an economics ****ing match. I'll indulge myself in one last reply.

Originally by: Gabriel Virtus
If people are not rational – as the number one assumption of economics – than economic analysis means nothing.


The point you don't get is that economics isn't a single model, with a fixed set of assumptions. There is a very healthy debate in economics about exactly this issue of rationality. Economics students, working on a particular problem set might assume simple utility maximising rationality, but that doesn't mean that economists do. Let me point you at three areas of mainstream economics which don't assume perfact rationality:

links


Cute reply. You should point to the part of my post where I claimed perfect rationality was an assumption of economic analysis. Before you go on a linking rant, you should try to read my post in the first place. Although I do think links in general give posts a more legitimate look.

Do you understand the difference between the terms "not rational" and "not perfectly rational"? Browse over wikipedia or google-search a few more things and come back if you like.

-GV


The part of your post that is relevant would be the one where you respond to his statement about people not being 'perfectly rational' by telling him economic analysis means nothing 'if people are not rational'. This certainly seems to be a response to his comments and the most obvious way of reading this is to understand your 'if people are not rational' in terms of his 'perfectly rational'.
Originally by: Gabriel Virtus
Originally by: Jimnoo

I wasn't using the unhappy lottery winner as proof that the marginal utility of an increase in wealth, just as an example. Don't you agree that it is possible that increased wealth can reduce happiness in reality? (Clearly it couldn't if the agents were pefectly rational becuase they could just give it away. But people aren't perfectly rational.)


First, why would you cite an example that doesn’t show what you are claiming? The problem with this analysis is that there can be many causes for the result, while you are claiming only one of them. I do not agree that increased wealth will reduce happiness, I think it might have zero effect on happiness, but to claim a negative value in a utility function the money variable seems quite farfetched to me. If people are not rational – as the number one assumption of economics – than economic analysis means nothing.

If you didn't mean to respond to this particular point of his then it is not entirely clear what you are responding to, and thus what the content of your argument is, here (perhaps you are just talking past hm whilst pretending to engage?). Seeking to clarify your own meaning would have been a better response than claiming that he failed at reading and listening to your 'teachings'. If people fail at reading your posts so frequently it might be worth considering that your posts fail to communicate with much precision or reconsidering your preference for making personal attacks over seeking to clarify your own contributions to the discussion.


GV's snarkiness aside, this seems like quite an interesting discussion. However, so far everyone seems to be treating 'happiness in a rather monolithic fashion as one single thing. Do economic theories ever take into account more complex models of happiness which might include conflicting drives such that one might say that an increase in money increases person A's happiness in respect of Happiness Type 1 but simultaneously decreases it in respect of Happiness Type 2?

Gabriel Virtus
hirr
Posted - 2010.10.17 19:32:00 - [27]
 

Originally by: RAW23

The part of your post that is relevant would be the one where you respond to his statement about people not being 'perfectly rational' by telling him economic analysis means nothing 'if people are not rational'. This certainly seems to be a response to his comments and the most obvious way of reading this is to understand your 'if people are not rational' in terms of his 'perfectly rational'.

Maybe you should try not reading it in stupid. If you are not being perfectly rational, it is not necessary true that you are being irrational. There is a continuum of rationality. If I say that rationality is the main assumption of economic analysis, a counter response is not to claim that people sometimes do not act “perfectly rational” because not acting “perfectly rational” does not mean you are acting irrational and therefore does not run afoul of this main assumption. If you cannot comprehend this basic logic, I think my words are entirely lost on you – which might be the case anyway. On a side note, I hope you are not actually a logic teacher.
Originally by: RAW23

If you didn't mean to respond to this particular point of his then it is not entirely clear what you are responding to, and thus what the content of your argument is, here (perhaps you are just talking past hm whilst pretending to engage?). Seeking to clarify your own meaning would have been a better response than claiming that he failed at reading and listening to your 'teachings'. If people fail at reading your posts so frequently it might be worth considering that your posts fail to communicate with much precision or reconsidering your preference for making personal attacks over seeking to clarify your own contributions to the discussion.

Maybe so... or maybe my audience seems to jump to conclusions of what my posts are saying before they actually read it. I appreciate your advice on how to respond to forum threads, but I suggest you should turn these powers of perception inward.
Originally by: RAW23

GV's snarkiness aside, this seems like quite an interesting discussion. However, so far everyone seems to be treating 'happiness in a rather monolithic fashion as one single thing. Do economic theories ever take into account more complex models of happiness which might include conflicting drives such that one might say that an increase in money increases person A's happiness in respect of Happiness Type 1 but simultaneously decreases it in respect of Happiness Type 2?

Happiness is not utility. The idea of utility encompasses what you seem to think are different types of happiness. I would suggest that utility means “net happiness” taking into account conflicting effects of certain variables, simplistically of course.


-GV

RAW23
Posted - 2010.10.18 11:12:00 - [28]
 

Originally by: GV

Maybe you should try not reading it in stupid. If you are not being perfectly rational, it is not necessary true that you are being irrational. There is a continuum of rationality. If I say that rationality is the main assumption of economic analysis, a counter response is not to claim that people sometimes do not act “perfectly rational” because not acting “perfectly rational” does not mean you are acting irrational and therefore does not run afoul of this main assumption. If you cannot comprehend this basic logic, I think my words are entirely lost on you – which might be the case anyway.



You're tilting at a straw man. The issue is one of interpretation, not of logic.

Originally by: GV

On a side note, I hope you are not actually a logic teacher.


I'm not.

On to the potentially interesting stuff ...

Originally by: GV

Happiness is not utility. The idea of utility encompasses what you seem to think are different types of happiness. I would suggest that utility means “net happiness” taking into account conflicting effects of certain variables, simplistically of course.




In what follows you will have to forgive me if I miss some of the nuances and technicalities involved in the economic terminology being used.

I take it (and please correct me if I'm wrong) that the meat of your position is contained in this post:

Originally by: GV

As you gain wealth, your marginal utility for each extra dollar generally goes down. However, it is accepted that a negative value for this variable – money – does not happen. Why would anyone be less happy with more money? A value of zero is not negative and certainly possible, but a negative value simply doesn’t happen. The only example I could think of is gaining wealth that has substantial costs to the person to cause them unhappiness, but these would be assessed in other variables.

People simply would stop gaining if it would ever be negative. Once it equals zero, they would stop trying whatsoever or simply refuse any more of it.


What degree of rationality is being assumed here? Also, what degree of access to the relevant information? To come to the conclusion that no one would ever continue gaining money if this led to a negative value seems to assume at least: a) enough rationality to correctly weigh all the relevant factors against each other ('perfect' rationality at least in the limited terms of the necessary calculation); b) a sufficient degree of foresight to be able to predict future consequences of gaining additional money now; c) true and accurate knowledge about one's current state of happiness. c) also implies d) some sort of true understanding of the nature of happiness.

In the absence of any one of these conditions couldn't one continue to gain wealth at the expense of a negative effect on one's happiness? Is it plausible to assume that all these conditions pertain in all cases or is this model perhaps only applicable to a theoretical human or a very limited category of humankind?

Alternatively, looking at your comment about 'other variables' and your first post in the thread, is the point you are making that wealth itself can never have a negative value because any negative consequences of wealth will fall under a different category/variable? That is, wealth is simply defined as a positive with no intrinsic ill effects? If so, what is the origin and value of this concept and does such an atomised conceptual framework actually correspond with our experience of the world?

Please try to respond in a form that will be accessible to a layman.





Tasko Pal
Aliastra
Posted - 2010.10.18 12:41:00 - [29]
 

Originally by: Marshiro
You can never have enough money, so says the economist, but is this really true?

One of the most fundamental assumptions of economists is that the marginal utility value of overall wealth can not be negative. However, in eve, we can see that is very obviously not true, as SISI is not some heaven of infinite happiness but a very boring place. The classical assumption that more wealth = more happiness probably remains in a microeconomic sense, but false in the macroeconomic one.

So what exactly is the best proxy for measuring the amount of satisfaction derived out of the economy? Just what kind of economic situation result in the happiest eve gamers? Low Gini? Uncomputable? Irrelevant?


Sisi is a bad example because there isn't a lot of value to buy. SencneS explained why very well.

As to the real Eve game on Tranquility, there's no drawback to having more isk. It's perfectly fungible and there's no overhead or security risk to arbitrarily large piles of isk aside from having to be a bit more careful in looking for scam contracts and market orders.

I could have a trillion isk in my wallet and I'd be no more a gank or crime target than if I had a million isk.

In the real world, you have to worry about fraud, kidnapping, theft, etc. And managing large investments is more work than small investments. So yes, I could see a point where the marginal cost, including overhead and risk, of an extra dollar of asset could be more than a dollar.

Claire Voyant
Posted - 2010.10.18 13:30:00 - [30]
 

RAW,

1) Children and pets can have a negative marginal utility. That is, while one is desirable, and two are better, there comes a point when 9 may be less desirable than 8. With money or anything else that is easily disposed of, this cannot occur because if a dollar were to bring you unhappiness you could always give or throw it away.

2) You need to separate the marginal utility of the money itself from the earning of that money. For example, winning the lottery may bring you all kinds of negative attention, but that is not necessarily a function of the money. If the money was deposited in your bank account anonymously, you might have a completely different experience. Likewise, rich people sometimes like to keep earning money because they derive pleasure from the earning of it and not just from the money itself. You also must separate the money from the spending. If you come into a large sum of money and buy a boat which then sinks to the bottom of the ocean with your entire family, it was not the money that brought you the unhappiness.

If you make those distinctions, I think you can easily see why someone would say that money cannot have a negative marginal utility.


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