Tag Archives: diminishing returns

Law of Diminishing Returns

A colleague shared his thoughts with me  today on the law of diminishing returns.  That is the point at which profits or benefit gained is less than the amount of money or energy invested.

In this model,  profit or benefit rises at an exponential rate to the inflexion  point and then the yield curve flatens.  Thus the effort and time to achieve the same benefit experienced in the exponential growth phase is much more.

Applying the Law to Happiness

In a given context my own experience completely supports the law of diminishing returns (it’s called a law rather than a theory because it has been proven mathematically)

Mathematical proof, though,does not apply to emotional measures such as happiness and this is where my collegue and I differed.  He attempted to apply the model to diminishing happiness with financial returns.

That is, financial gain or benefit drives a larger increase in your personal happiness before the inflexion point is reached.  After that a much greater ruturn is needed to raise your happiness.

Happiness is a chice, not a creation

While I understand the law of diminishing returns as applied to operational or manufacturing processes, I am not convinced it can apply to levels of emotional well being.

For example, I have definitely observed personally that 100 auto workers output is not 10 times that of 10 workers.  It is not a linear relationship and that fact can be mathematicaly proven.

Happiness however is not manufactured or created.  You choose wether you are happy or not together with the associated level of magnitude.

While your  knowledge, material wealth and personal stature  may well influence the level of happiness you choose to feel, it is still ultimately entirely your choice.