Different things maximize my utility every day

Yesterday I took my 1 year old son to the zoo. I was very happy watching him being happy watching the animals. My utility was at maximum level. Today, I read about the new proof for general equilibrium for a pure exchange economy where agents are heterogeneous and I was very happy and satisfied when I understood the proof. My utility was maximized again. I am thinking, what will be the following optimal thing that will maximize my utility tomorrow...

We Need Much Energy and A Good Environment for Maximizing Our Utilities but Is This Simultaneously Possible?

Does Richer = Greener? In his article, “Use Energy, Get Rich and Save the Planet”, John Tierney argues that the best way to save the planet and deal with environmental problems is to let nations consume as much energy as they need for development. This way, nations will get richer, develop advanced technologies and gradually switch to the more environmental friendly sources of energy. While there dominates a common sense that wealth is positively correlated with traditional energy consumption which consequently causes environmental degradation in the long run, Tierney’s idiosyncratic position is much more realistic and logical. The richer everyone gets, the greener the planet will be in the long run.

Sublime beauty of Paul Ehrlich and John P. Holdren’s formula – environmental impact = population x Affluence x technology – might seem so persuasive and intuitive that one becomes tempted to acknowledge that there is nothing wrong with the relations in the equation. In fact, taken alone, population and affluence are really the main reasons for environmental degradation. However, if we also let the technology vary then the relation between right and left hand sides of the equation becomes reversed. Developed technology also means developed energy technology which implies more effective usage of existing stock of energy and development of new, environmental friendly and cheaper types of energies (e.g. solar and nuclear energy). Thus, while the equation might make sense for the short run, in the long run (when technology is not fixed and varies greatly) it lacks logic and sense.

The position, that development makes planet greener, is also supported by the real world facts. For example, in United States, the share of solar and nuclear energy production in the whole energy production is increasing. The country has also developed technologies for extracting and refining shale gas which is also much cleaner and greener energy than traditional gas or fuel. The effects of such changes might not bee seen in the short run because such technological advancements require decades for being completely implemented in practice and for being thoroughly utilized by the societies.

Another reason for believing that planet will be in much better conditions in the long run is Kuznets curve. Tierney, mainly bases his arguments on the properties of the curve. Kuznets curve is a cap type curve which was empirically estimated based on the CO2 emissions data of the developed countries. The curve shows that at the early stage of technological development (the age of industrial revolutions) environment is being highly damaged. After the technologies become more developed the rate of damage on environment starts decreasing and at a certain stage the rate becomes zero. Afterwards, the curve becomes downward sloping – meaning that environment starts improving. Kuznets curve is deterministic and no policy, treaty or some kind of other revolutionary action could change its laws of motion. For example, Kyoto protocol, which was aimed at reducing global CO2 emissions and other sorts of pollutions through restrictive rules, failed its objectives because no nation would reduce energy consumption and stop development voluntarily. One simply just can not force India and China to stop or decelerate development.

As a conclusion, Kuznets curve, real world facts and the logic that being rich means having advanced
technologies and having advanced technologies means having advanced energy technologies that are more
efficient and environmental friendly, compile a persuasive set of arguments asserting that the richer everyone
gets, the greener the planet will be in the long run.

What maximizes your utility level?

Utility is the only goal of human existence. This might sound like a biased motto. However, if you think deeper and understand the concept of utility more precisely, you will surely come to the same conclusion – everyone will come to the same conclusion.

Jeremy Bentham, the father of utilitarianism, defines the concept in a most precise manner: “that property in any object, whereby it tends to produce benefit, advantage, pleasure, good, or happiness...or...to prevent the happening of mischief, pain, evil, or unhappiness”.

The definition by Bentham is perfect. So, isn’t that the ultimate goal of human being to attain the greatest pleasure and to prevent pain and unhappiness? We love money because it allows us to fulfill all of our dreams that provide pleasure and happiness to us. We love arts because it also provides aesthetic pleasure and nice feelings. We love sex because it provides pleasure and satisfaction…

Some might argue that there exist people who are not utility maximizers.  No, that is not true. All of us turn out being utility maximizers in the end. Even the monks, who do not get any pleasure from earthly things, turn out being the most fanatic utility maximizers. They like self-flagellation because it provides spiritual utility to them – they are pleased spiritually. Even the martyrs, who fight for some goals and sacrifice their lives, are the biggest utilitarians. They get the biggest pleasure knowing that they are giving everything for achieving the ultimate goal – their physical pain is worth the spiritual pleasure they experience.

Scientists experience pleasure through the channels of knowledge and satisfied curiosity; politicians experience pleasure when they attain power and prestige etc. Thus the difference between the various kinds of people is the channels through which they attain pleasure and the only goal is MAXIMAL UTILITY.