ABSTRACT
William Stanley Jevons’ concepts in mathematical economics soon began to take shape. By 1860 the notion of diminishing marginal utility had been formulated and two years later his paper on the subject, “Brief Account of a General Mathematical Theory of Political Economy,” was sent to the British Association for the Advancement of Science. Marginalism transmuted costs into psychological phenomena, since what a firm paid for its inputs was to be based on the vendor’s marginal utility as determined in the process of exchange. Thus, supply too was rooted in the psychology of the economic man. Friedrich von Wieser was the only one of the Austrians to produce a genuine treatise. This was his Social Economics, a volume highly praised by Wesley C. Mitchell. Marginalism has emerged as a merely formal way of developing the implications of certain propositions about human actions which in themselves have possessed but limited validity. As such, it is a pure, system, with little operational usefulness.
