marginalismia

Marginalismia is a hypothetical economic concept that describes a state of economic decision-making where individuals or entities consistently make choices based solely on the marginal benefit or cost of the very next unit of a good, service, or action. In this theoretical framework, the total or average costs and benefits are disregarded, and attention is exclusively focused on the incremental changes.

This approach to decision-making is a pure extrapolation of the principle of marginal utility and marginal cost, fundamental concepts in neoclassical economics. While marginal analysis is a widely used tool in economics for understanding optimal allocation of resources, marginalismia suggests a more extreme and potentially unrealistic application where no other factors influence a decision beyond the immediate marginal impact.

In a marginalist economy, for example, a consumer would only consider the satisfaction gained from consuming one additional unit of a product, irrespective of the total satisfaction derived from previous units or the overall price paid. Similarly, a firm would only evaluate the cost and revenue of producing one more unit, ignoring fixed costs or long-term profitability considerations. This theoretical construct helps economists explore the logical outcomes of extreme marginal thinking, highlighting potential inefficiencies that could arise if decisions were made without considering broader economic contexts.