Hermann Heinrich Gossen

Gossen's law is the rule of economics put forward by the German economist Hermann Heinrich Gossen.

Gossen's Law 1
is a generalization of facts based on experience if the satisfaction of the need for a certain type of thing dilakukakn continuously, enjoyment will continue to diminish until finally reach a saturation. Thus the enjoyment of the last consumed object is a marginal pleasure.

Gossen's Law 2
is a pure economic law. The law of Gossen 2 reads that man will try to meet his various needs as much as possible to the same degree of intensity.

The law of gossen 2 is also called the law of Horizontal because it deals with the satisfaction of various goods, whereas the law of gossen 1 is called law in order to vertical because it only deals with the satisfaction of one kind of goods. Consumers will be in balance and achieve maximum satisfaction if in spending budget it has, the marginal satisfaction achieved the unit of money is the same. If this is not the case, then with the consumer spending arrangements will reach a higher satisfaction limit. It must be done until it is not possible to make more profitable arrangements. Thus the satisfaction achieved is maximized, which would not occur in marginalization of marginal satisfaction in spending money. The second gossen law is also often formulated as a comparative agreement between the marginal mastery of the objects consumed.

Post a Comment