13Oct 2018 by Reese Bannister

Henry Maine's Theory of the Evolution of Private Property – Explained!

History
Henry Maine’s theory of the evolution of private property.—Sir Henry Maine is of opinion that there is the strongest reason for think­ing that property once belonged not lo individuals nor even to isolated families, but to larger societies composed on the parlriarchal model; but the mode of transition from ancient to modern ownership, obscure at best, would have been infinitely obscurer if several distinguishable forms of village communities had been discovered and examined. In the Slavonia villages, he observes, the entire land is the common property of the whole body of kinsmen and is not divisible even in theory. Image Source: img.auctiva.comPreceding a step further, he observes that in Russian villages there is only a temporary division. Different holdings are, for agricul­tural convenience, allotted, for a temporary period, to different…
Read More
13Oct 2018 by Reese Bannister

9 Important Assumptions of Indifference Curve Analysis

Law
Indifference curves analysis is based upon some assumptions, which determine its strength, applicability and shortcomings. W.J. Baumol has taken three main assumptions of non-satiety, transitivity and diminishing marginal rate of substitution. image source: cdn.yourarticlelibrary.comThe various assumptions of the analysis are explained below. (a) Non Satiety: ADVERTISEMENTS: This assumption implies that the consumer has not reached the point of saturation in the consumption of any good. Thus, he always prefers to have more of both commodities. He always tries to move to a higher indifference curve to get higher and higher satisfaction. This assumption is called monotonicity of preferences. (b) Completeness: To enable the consumer to make an optimal choice in the commodity space (entire area lying between the X-axis and Y-axis, it is assumed that between any two bundles, either…
Read More
13Oct 2018 by Reese Bannister

2 Important Conditions that must be satisfied for Consumer Equilibrium

Budget
Indifference map shows the tastes and preferences of the consumer independently of the market conditions, i.e., what the consumer would like to do.On the other hand, the budget line represents the purchasing power or opportunities open to the consumer in the market, given his income and prices of the commodities, i.e., what the consumer is able to do.The indifference map and the budget line are quite independent of each other so long as the consumer does not start making purchases in the market. image source: i.ytimg.com ADVERTISEMENTS: However, both of these instruments are important in the determination of consumer equilibrium or in predicting what consumer will actually do, i.e., how the consumer spends his money in the pursuit of his needs and interests.Every consumer wants to maximise the satisfaction. But,…
Read More
13Oct 2018 by Reese Bannister

9 Major Limitations of the Law of Diminishing Marginal Utility

Music
The law as propounded by Marshall expresses a universal human nature and experience. The more a consumer has of anything, the less important one unit of it becomes to him. image source: i.ytimg.comHowever, there are many situations in which this law cannot be applied. Moreover, the assumptions on which the law is based may not be fulfilled in real life. Some of the limitations are: (a) Suitable Units: ADVERTISEMENTS: The law of diminishing MU holds good only if units of the commodity supplied to the consumer are in suitable units. A unit must be complete for its consumption or use. The commodity should not be consumed in very small units. For example, the law does not hold good for a single shoe.Similarly, a holiday of a very short duration may…
Read More
13Oct 2018 by Reese Bannister

4 Important Practical Importance of Law of Diminishing Marginal Utility

Taxation
The Practical Importance of law of diminishing marginal utility are given below: image source: i.ytimg.com (a) Diversification in Production: Besides diversification in consumption, the law also helps us in bringing about diversification in the production process. Greater and greater use of the same kind of good makes us feel bored reducing its marginal utility. ADVERTISEMENTS: To overcome the resistance of the consumers and in order to secure higher profits, the producers continuously introduce newer varieties of the products with new design, shape, colour, technique and presentation. (b) Household Expenditure: This law governs our daily expenditure. Since larger purchases reduce marginal utility, we restrict the purchase of a particular commodity, as we cannot afford to waste our limited resources. We stop further purchases at a point, where marginal utility equals price.…
Read More
13Oct 2018 by Reese Bannister

What are the Limitations of Law of Equi Marginal Utility? (7 Limitations)

Traditions
In actual life, we come across many situations, where the law of equi-marginal utility is not applicable. Some of the important limitations are:(i) It is assumed that the consumer spends very small amount of money on different commodities. However, this is not possible as commodities, especially costly ones, are indivisible. Radios, TV, telephone, etc., are such commodities, which cannot be bought in parts. Their purchases are bulky and do not allow small variation. In such cases, it becomes difficult to equate marginal utilities.(ii) Most of the consumers are ignorant. They do not know about the various alternatives which are most useful. Consumers are not prudent enough to assess and compare variations in marginal utilities of different commodities. image source: i.ytimg.com ADVERTISEMENTS: (iii) The law assumes that utility can be measured.…
Read More
13Oct 2018 by Reese Bannister

5 Important Applications of the Law of Equi-marginal Utility of Substitution in Diversified Fields of Economics

Budget
The law of equi-marginal utility has wide applications in almost all spheres of man’s economic behaviour. In the words of Samuelson, it is not merely a law of economics; it is a law of logic itself” image source: i.ytimg.comThe applications of this law of substitution in diversified fields of Economics are discussed here. 1. Consumption: ADVERTISEMENTS: In the field of consumption, the law tells us as to how should a consumer spend his money to secure maximum utility. The law not only explains the number of units of various commodities to be purchased by the consumer, it also helps the consumer in allocating income of the consumer into multiple uses of the same commodity. Further, the decision regarding the propor­tion of income to be spent and the proportion to be…
Read More
13Oct 2018 by Reese Bannister

What is the Law of Equi Marginal Utility? (Consumer Equilibrium)

Budget
A consumer spends his income on many goods and services. Now, the question is, how he should distribute his total income among these goods and services, so that he may be in equilibrium. That is, he attains the maximum possible level of utility.Here, it should be pointed out that the consumer is assumed to be a rational person, judicially and carefully calculating the utilities of various goods and substituting them for one another to maximise utility. Further, marginal utility of money is assumed to be constant.We analyse the equilibrium of the consumer by taking the case of two goods, ‘A’ and ‘B’. The same analysis can be extended for any number of goods. Let the prices of ‘A’ and ‘B’ are PA and PB respectively. image source: i.ytimg.com ADVERTISEMENTS: Then…
Read More
13Oct 2018 by Reese Bannister

Brief Notes on Mercantilism Theory of International Trade

Dance
Mercantilism, the first theory of international trade emerged in England in the middle of 16th century, formed the backbone of economic thought from 1500-1800 AD. The basic premise or philosophy of this theory is that a country would be stronger if its exports exceeded imports. In the process, the country would accumulate gold and silver, the basis of power and wealth.Consistent with this philosophy, government subsidised exports and put barriers to imports. The mercantilists were interested in a surplus in balance of trade, than maximisation of trade. Some colonialist countries used their colonies to support this objective.Colonies were used as source of raw materials and markets for finished products. The industrial structure of colonies was broken so that markets for export goods can be there. This kind of exploitation was…
Read More
13Oct 2018 by Reese Bannister

Useful Notes on the Preparation and Preservation of Antisera

Culture
A complete antisera is the serum of an animal, immunized by injection of serum from other animal.Antisera in use are available commercially but can be prepared easily in laboratory from collected blood of immunized donors.When collecting blood for antisera, collect blood in a sterile container without anticoagulant. Incubate at 37QC for 1 hr. to get good clot retraction. ADVERTISEMENTS: Leave the clotted blood at 4oC overnight to allow absorption of cold agglutinins on the red cells. Centrifuge the container and separate the serum in a second sterile container.If plasmapheresis is carried out, add one ml of 1 M CaCl2.6 H2O for every 100 ml of plasma to be defibrinated. Incubate at 37oC for 15 to 30 min. allowing clot to form and retract. Separate the clear serum.To prevent bacterial contamination,…
Read More