On newspapers and soda cans

Thoughts on this question asked below. Props to grant, Kevin White, and Spoonie Luv for stepping up to the plate. grant essentially nailed it.

When I am done reading a newspaper, a second newspaper is essentially useless to me. A second newspaper does not give me any new information. If my friend wants to know the news, I can give him that same newspaper; neither he nor I need a second newspaper.

When I am done drinking a can of soda, a second can of soda can be potentially very useful to me. It can be consumed, stored for future use, given to friends, etc.

In other words, the marginal utility (value) of a second newspaper is close to zero. However, the marginal utility of a second can of soda, although less than the first can of soda (per the Law of Diminishing Marginal Utility), does not fall nearly as rapidly.

Thus, vendors face little risk of a customer taking more than one newspaper, but face a much greater risk of a customer taking more than one can of soda if soda was sold in the same way as newspapers. They try to minimize the cost needed to sell their product without theft. The single dispenser vending machine is likely more expensive than a simple box. As a result, single dispensers are used to sell soda and boxes are used to sell newspapers.

There are other issues that enter the picture - advertising, time at sale, etc - but I think they are relatively small compared to the marginal utility of a second unit of the good.

Is any of this particularly Austrian? Not really, other than the fact that I used no numbers, equations, or graphs. And it demonstrates that the utility of a good is ordinally determined by what end it helps achieve and is defined at the margin, i.e., at the addition of a single unit of that good.

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