History of the Gossen Equation and 21st Century Applications

We have quite recently entered a New Age, unlike any before, one enabling the ascent people everywhere to the high plateau of general well being and security. This new age is based or founded on two very recent historical and irreversible developments: (1) The general recognition and acceptance of the permanent nuclear détente between major powers, allowing international cooperation at all levels for the common good; and (2) The deepening of mathematical behavior and standard economics to the neuropsychological foundation, thereby enabling the analytic understanding required to promote and achieve the common good. The Gossen Equation—a formulation in progress since Hermann Gossen’s single contribution (book) in 1854, and completed by numerous researchers over the ensuing 100+ years  in 1993—is the end-result of the latter development (2) and the beginning of mathematical and conceptual studies using this equation to understand and defeat poverty. While an overarching history of the Gossen Equation and subsequent studies is provided, the primary emphasis is on the author’s theoretical contributions to the equation in the early 1990s along with his applications of the equation to help correct economic instability (the natural tendency of the market economy to enrich the few at the expense or harm of the disadvantaged). Attention is also given to a primary conclusion or determination from the development of the Gossen Equation—that standard/ neoclassical economics is essentially unsound and therefore provides an insufficient or inadequate basis for the dominant ideological prescriptions over the past approximately 30 years, prescriptions which include the Washington Consensus, neoliberalism, and free/open markets. Because of this deeper understanding in our new age, people and governments everywhere may now plan in greater accordance with their cultures and traditions, their level of socioeconomic progress, and their forms of government, in the continuing effort to improve the lives of their own citizens and populations around the globe.