Textbook Definition of Diminishing Marginal Returns: Holding all else equal, the incremental benefits from consumption decrease as consumption increases.
She-conomic Definition: Unless something exogenous happens, (for example, a spiritual transformation that helps me continually overlook my partner's flaws), my interest in a guy generally decreases over time, and the same can most certainly be said about his interest in me.
While this supposition may explain the prevalence of break-ups and divorce, surely my tentative economic conclusion doesn't ALWAYS have to be true? How can it be that couples can truly experience lasting, INCREASING (not diminishing) love for each other?
My best guess is that some external factor (such as working "extra hard" to make a relationship work and embracing faith and guidance from the Divine) must be embraced as a force for continually "shifting out" the demand for a strong relationship with your partner. Am I wrong? Has my degree in economics forced me to abandon my fairy tale ideals about love? Opine if you care.
The issue of complementarity and super-modularity could be used here but I doubt anyone wants to see the equations. Diminishing marginal returns is one assumption--it's certainly not appropriate in all situations. Interesting question though.
ReplyDeleteHmmm, I'd have to agree that those equations probably are beyond the scope of "Econ 110 intuition." Nevertheless, I'm so happy to have a math/pre-Econ-PhD's perspective on this. Muy bien.
ReplyDeleteNon-econ perspective here. Interesting comparison, but here's where relationships don't have to fit into the law: You've got to rethink the assumption made with the rule. "Holding all else equal" is not possible with the really good relationships. Life changes, you learn more about your partner, he/she becomes a more seasoned and involved witness to your life.
ReplyDeleteI was always worried about this, too: I used to get sick of people. But something exogenous can happen if you want it to. You can see the flaws but forgive them. And if your personalities really are a good fit, you want to forgive them. And if the partner is willing to forgive, too, you're all set.
But you can't really believe this law, because if it applies to dating relationships then it would have to apply to family and non-romantic friendships. I'm sure you know that those don't have diminishing returns. So if you're going to abandon fairy-tale ideas about romance, you're also going to have to assume your relationships with those you love nonromantically will also peter out, and I'm sure you can't do that.
Excellent point, Dani! I'm glad to have a non-econ person opine. You're right--there has to be something exogenous going on--in romantic AND non-romantic relationships--to prevent us from dumping all of our friends. Forgiveness is a good example of an outside force that keeps demand for friendship shifting "eternally" outward toward infinity.
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