- noun a method of showing utility as a function of the consumption of goods and services by an individual. It increases with each unit consumed.
- (written as Utility Function)
A mathematical function that relates utility to the rate of consumption of various goods and services or, in some sophisticated cases, to the characteristics of consumer goods and services. The general form of the function is usually:
U = U(Q1, Q2, Q3. . .QN),
where the Qi are goods or services, and where dU/dQi > 0 is marginal utility.
It is possible to model altruism in utilitarian terms by postulating that some of the arguments (the Qi in the utility function) are entities that accrue to other people. This is to say that the choosing individual derives utility from the consumption, experience, etc. of another person: in a health context, one is, perhaps, pleased to see another person healthier or with greater access to health care than would otherwise be the case. Conversely, of course, a malevolent person by analogy derives negative utility from positive arguments of another's utility.
- synonymPreference Function