Marginal Utility Considered as a Return to Past Traditions

This paper examines the marginal utility as a theory of value in comparison with the theories which preceded it. It compares in detail the utility theory with the predominant theory of value of classical economics, a cost theory which saw labor as the ultimate source of value. By introducing a “subjective” element into the basic determinant of value, the marginal theory did more than just revolutionize the then current economic thinking. It was able to hark back to the best of the ancient theories of value which saw moral economic activity as necessarily involving an exchange of true value to the participants.