The diminishing marginal utility of income explains why the family would work fewer hours.
2.
Indeed, Smith himself doesn't seem to have had much truck for the diminishing marginal utility of income.
3.
More specifically, when making comparisons between countries, a principle called the Diminishing Marginal Utility of Income ( DMUI ) stands strong.
4.
Because the marginal rate of substitution of leisure for income is also the ratio of the marginal utility of leisure ( MU L ) to the marginal utility of income ( MU Y ), one can conclude:
5.
There is also the concept of the diminishing marginal utility of income ( DMUI ), which is that money has no effect on happiness once a certain income level has been reached, and which represents wealth and happiness as having a curvilinear relationship.
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