Course video 5: The marginal revolution and Carl Menger

Lynne Kiesling

The Marginal Revolution in Economics from Lynne Kiesling on Vimeo.

A fundamental question in economics is value theory — where do prices come from, what determents the value of a commodity, product, or good? The classical economists operated with a labor theory of value, but in the mid-19th century, three different economists from three different countries independently developed their own theories of value based on subjective utility and decision-making at the margin. This paradigm shift in economics opened up a wealth of new thinking about human decision-making, and remains the dominant value theory in economics to this day.