15 Aug 2012

Debunking Economics III: Assumptions

I wanted to present as a list all of the assumptions which I have noted in economics. I'll update as I go.
  • a rational individual maximises their pleasure to achieve happiness
  • maximisation of pleasure is assumed to be achieved through consumption of goods. 
  •  a util is assumed to be in a constant ratio to units of consumption. 
  •  the util ratio is assumed to apply to all goods. 
  • It is assumed that we would always want more of a good, but that the amount satisfaction we get from each new unit of consumption produces less utility.
  • all consumers spend all their income.
  • price changes do not affect income. 

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Keep is seemly & on-topic. Thanks.