The Corner

You Can’t Build the Interstate Highway System Twice

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Let’s say I’m hungry and I make a sandwich. Once I eat that sandwich, I’ll feel much better than I did before doing so. My stomach will stop grumbling and I’ll no longer feel quite as hungry. If I then make and eat another sandwich, I won’t feel nearly as good as I did after the first.

If you understood that, you’ve understood one of the most basic principles of economics: diminishing marginal utility. Each additional unit of something provides less utility than does the unit before.

Diminishing marginal utility isn’t just useful when talking about sandwiches. It’s also useful when talking

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