The Law of Diminishing Marginal Utility in Alfred Marshall's Principles of Economics

Ormazabal, Kepa

doi:10.1080/10427719500000096

Cited by 20 publications

(9 citation statements)

References 12 publications

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“…Thus, they are a kind of extrinsic or economic benefit [ 22 , 23 ]. Further, in light of “the law of diminishing marginal utility” [ 34 ], a classic law in economics, we further explore how psychological and material rewards affect the physicians’ online contributions. Based on universal human experience, this law states that the marginal utility derived from each additional unit diminishes compared to that of the previous unit.…”

Section: Methodsmentioning

confidence: 99%

Understanding a Nonlinear Causal Relationship Between Rewards and Physicians’ Contributions in Online Health Care Communities: Longitudinal Study

Wang¹,

Chiu²,

Yu³

et al. 2017

J Med Internet Res

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BackgroundThe online health care community is not just a place for the public to share physician reviews or medical knowledge, but also a physician-patient communication platform. The medical resources of developing countries are relatively inadequate, and the online health care community is a potential solution to alleviate the phenomenon of long hospital queues and the lack of medical resources in rural areas. However, the success of the online health care community depends on online contributions by physicians.ObjectiveThe aim of this study is to examine the effect of incentive mechanisms on physician’s online contribution behavior in the online health community. We addressed the following questions: (1) from which specialty area are physicians more likely to participate in online health care community activities, (2) what are the factors affecting physician online contributions, and (3) do incentive mechanisms, including psychological and material rewards, result in differences of physician online contributions?MethodsWe designed a longitudinal study involving a data sample in three waves. All data were collected from the Good Doctor website, which is the largest online health care community in China. We first used descriptive statistics to investigate the physician online contribution behavior in its entirety. Then multiple linear and quadratic regression models were applied to verify the causal relationship between rewards and physician online contribution.ResultsOur sample included 40,300 physicians from 3607 different hospitals, 10 different major specialty areas, and 31 different provinces or municipalities. Based on the multiple quadratic regression model, we found that the coefficients of the control variables, past physician online contributions, doctor review rating, clinic title, hospital level, and city level, were .415, .189, –.099, –.106, and –.143, respectively. For the psychological (or material) rewards, the standardized coefficient of the main effect was 0.261 (or 0.688) and the standardized coefficient of the quadratic effect was –0.015 (or –0.049). All estimates were statistically significant (P<.001).ConclusionsPhysicians with more past physician online contribution, with higher review ratings, coming from lower level clinics, not coming from tertiary hospitals, and not coming from big cities were more willing to participate in online health care community activities. To promote physician online contribution, it is necessary to establish an appropriate incentive mechanism including psychological and material rewards. Finally, our findings suggest two guidelines for designing a useful incentive mechanism to facilitate physician online contribution. First, material reward is more useful than psychological reward. Second, as indicated by the concave-down-increasing causal relationship between rewards and physician online contribution, although an appropriate reward is effective in encouraging willingness on the part of physicians to contribute to the online health care community, the effect o...

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Section: Methodsmentioning

confidence: 99%

Understanding a Nonlinear Causal Relationship Between Rewards and Physicians’ Contributions in Online Health Care Communities: Longitudinal Study

Wang¹,

Chiu²,

Yu³

et al. 2017

J Med Internet Res

View full text Add to dashboard Cite

show abstract

“…The bid value significantly impacted the willingness of tea farmers to accept a subsidy (Table 3). In the double-bounded dichotomous CVM, with an increase in the bid value, the proportion of farmers willing to accept a TEPM system increased in response to the initial bid (Table 3), according to the economics principle of utility [22]. The bid value of 4500 yuan was the turning point, which indicated that the proportion of acceptance of a bid value of 4500 yuan was lower than the bid value of 3000 (Table 3).…”

Section: The Socio-economic Characteristicsmentioning

confidence: 99%

Factors and Minimal Subsidy Associated with Tea Farmers’ Willingness to Adopt Ecological Pest Management

et al. 2019

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Scientific assessment related to the externalities of the tea ecological pest management (TEPM) system that can affect socio-economic development and ecological benefits is important to the sustainable development of the tea industry. This paper used the contingent valuation method to evaluate the externalities associated with TEPM and the factors affecting its adoption by farmers through survey data collected from Anxi county, Fujian province, China. The results showed that the positive externalities, which were not internalized (embodied in price), affected the willingness of tea farmers to adopt TEPM. The willingness to accept a subsidy for adopting the TEPM system was significantly affected by the individual tea farmer’s age, education level, income, plantation, knowledge of human health and risk preference. The compensation threshold of externalities for TEPM was 5668.80 yuan per hectare per year. It is suggested that the government should adopt this threshold as a minimum subsidy to mitigate information asymmetry in two markets, namely ecological management technology and trading between suppliers and buyers of tea products. Finally, production stability and improved price for high quality tea resulting from healthy ecology in TEPM could enhance positive externalities. This coupled with other benefits, such as a reduction in the amount of resources spent on pesticides, could result in governmental subsidies for TEPM being gradually reduced over time.

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“…The diminishing benefit at high exacerbation risks could thus be interpreted analogously to the law of diminishing marginal utility, but here, net clinical benefit, rather than utility. 35 However, this finding could change if the risk of harm outcomes (such as pneumonia) are not the same across the exacerbation risk spectrum.…”

Section: Discussionmentioning

confidence: 99%

Personalising add-on treatment with inhaled corticosteroids in patients with chronic obstructive pulmonary disease: a benefit–harm modelling study

Yebyo

Braun

Menges

et al. 2021

The Lancet Digital Health

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Background Since the benefit-harm balance of adding inhaled corticosteroids to long-acting β 2 -agonists (LABA) and long-acting muscarinic antagonists (LAMA) for patients with chronic obstructive pulmonary disease is unclear, we evaluated this addition for a range of patient profiles.Methods Analyses considered the effects of low-to-moderate doses of inhaled corticosteroids, LABA, and LAMA compared with LABA and LAMA alone, outcome incidences, and preference weights assigned to averted moderateto-severe exacerbations (benefit) and severe pneumonia, candidiasis, and dysphonia (harm). Using exponential models, we estimated the preference weight-adjusted 2-year net clinical benefit (ie, benefits outweighing harms) indices. Exacerbation risk thresholds for triggering inhaled corticosteroids, LABA, and LAMA were established when the probability of a 2-year net clinical benefit reached 60%. We estimated the proportion of patients benefiting from added inhaled corticosteroids using an externally validated prediction model for acute exacerbations in primary care.Findings Adding low-to-moderate dose inhaled corticosteroids to LABA and LAMA provided a net clinical benefit in patients with a 2-year baseline exacerbation risk of 54-83%. Low-dose inhaled corticosteroids showed a net clinical benefit if the baseline risk was 40-91%, but not at higher doses. The benefit was modified by blood eosinophil count (BEC) and age. Although no net benefit was associated with a BEC of less than 150 cells per µL, patients with a BEC of 150 cells per µL or more had a net benefit from low-dose inhaled corticosteroids with a 2-year exacerbation risk of 32-95% in those aged 40-79 years and 41-93% in those older than 80 years. A moderate dose of inhaled corticosteroids showed a net benefit in patients younger than 80 years with a BEC of 150 cells per µL or more at 52-86% 2-year exacerbation risk. Depending on the subgroups, the proportion of patients with a net benefit from added inhaled corticosteroids ranged from 0 to 68%. InterpretationThe net clinical benefit of adding different inhaled corticosteroid doses to LABA and LAMA varies greatly with exacerbation risk, BEC, and age. Personalised treatment decisions based on these factors and predicted exacerbation risks might reduce overtreatment and undertreatment with inhaled corticosteroids.

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The Law of Diminishing Marginal Utility in Alfred Marshall's Principles of Economics

Cited by 20 publications

References 12 publications

Understanding a Nonlinear Causal Relationship Between Rewards and Physicians’ Contributions in Online Health Care Communities: Longitudinal Study

Understanding a Nonlinear Causal Relationship Between Rewards and Physicians’ Contributions in Online Health Care Communities: Longitudinal Study

Factors and Minimal Subsidy Associated with Tea Farmers’ Willingness to Adopt Ecological Pest Management

Personalising add-on treatment with inhaled corticosteroids in patients with chronic obstructive pulmonary disease: a benefit–harm modelling study

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