This article argues that Marshall's theory of market choice was originally elaborated within the classic framework of the use value/exchangeable value dichotomy, with reference to a version of utilitarianism that did not assume measurable utility. The key concepts were those of marginal transaction and consumer surplus or rent, both of which were expressed exclusively in terms of money transfers. Later on, Marshall moved toward an explicitly utilitarian framework by emphasizing the marginal utility of money, possibly because he had stumbled on the problem of the determinateness of marginal demand prices. The article shows that, by moving in this direction, Marshall committed himself to a standpoint that undermined the generality of his approach to consumer behavior and obscured his promising ideas concerning interpersonal comparisons of welfare. It is also argued that this move was actually unnecessary, as the early framework could have enabled Marshall to deal with the problem of determinateness in less restrictive terms.
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Research Article| November 01 2008
Marco Dardi; Utilitarianism without Utility: A Missed Opportunity in Alfred Marshall's Theory of Market Choice. History of Political Economy 1 November 2008; 40 (4): 613–632. doi: https://doi.org/10.1215/00182702-2008-025
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