Today we are going to learn another rule of economics as it applies to your practical life. There exists a concept called the Law Of Diminishing Returns, which simple states that increased activity results in increasingly diminishing returns with each additional unit of input. If we were to graph, it would look something like this:

On the horizontal axis you would have any activity and on the vertical axis you would have a benefit derived from that activity.

In my undergraduate college days, I used to think that about the above law only in turns of economics: factories, production, etc. Often, I would not realize that this law applies to many, if not all of our every day activities and goals that we try to achieve in life.

Let’s take a further look.

For the longest the idea of that more is better was unchallenged. Only, recently the less is more philosophy emerged. Less is more is nothing else but the law of diminishing returns defined in very simple terms. To be exactly correct, the following statement is true: more is less, as illustrated by the graph above.

I was first introduced to the idea of less is more when I saw a video about choice on TED. The speaker said that too much choice leads to confusion, unhappiness and frustration. This part of the argument can demonstrated by the above graph as well. At a certain point the benefit derived from an activity starts to decrease. I guess, this should not strike anybody as great news, because we have always heard of people telling us that moderation is the best and that too much of anything is bad for us. Well, now you have a graph to prove it.

However, let us consider the simple and powerful implications of law of diminishing returns to our everyday lives. Let us a create a couple of graphs to together.

1. Put MONEY on horizontal axis and HAPPINESS on vertical axis. It becomes clear that at a certain point money does not bring in any extra happiness. Also, it implies that having too much money, can also decrease your overall happiness. I read about a study in the Art of Choosing, which said that people who earned $100,000 were just about as happy as those earning half of that amount. It went on further to say that the same holds true for individuals who earn over $5,000,000. Think about it.
2. Put STUFF on horizontal axis and sense of INDIVIDUALITY on the vertical axis. The same simple pattern repeats.
3. Put variety of FOOD/EXERCISE on horizontal axis and HEALTH on the vertical axis. Watch the same pattern unfold.
4. Put KNOWLEDGE on horizontal axis and UNDERSTANDING OF THE WORLD on the vertical axis. Same rules apply.
5. Put EXPERIENCE on horizontal axis and WISDOM on vertical axis. It also holds true.
6. Put amount of CHOICES on horizontal axis and HAPPINESS on vertical axis.

The examples could go on forever. The point is that any given activity increases a benefit only to a certain extent. After that, the benefit either rises very slowly or it even starts diminishing. Try out the above exercise for yourself and you will see how this holds true.

More importantly, what are further implications of the above graph? It means that there is an optimum amount of MONEY, STUFF, variety of FOOD/EXERCISE, KNOWLEDGE, EXPERIENCES, CHOICES which will cause a maximum overall benefit to us. Isn’t it amazing? To me, it is.

It limits the possibilities in this world. Well, how is that great, you might ask? Simple. We all have a limited amount of time to live on this earth and we want to optimize how we spend out time. Clearly, we cannot experience everything that this world has to offer. But, now I realized that there is no need to because of the relationship described in this paragraph. The only question that is left to answer is the following: “What is the right of amount of “activity” that we need to perform to obtain the maximum amount of “benefit”?

If we could figure that out, then we could easily know how much money we need, how much variety of food we need, how many and what type of experiences to seek, and how many choices we should offered to maintain the optimum amount of well-being. Armed with that knowledge we could truly simplify our lives and feel so overwhelmed to do more and more without realized if and how much extra benefit we are gaining from a given activity.

Even though the options and activities are endless, the way we react and experience life is limited. So who is up for the challenge to figure out how much and what type of activity we need to maintain and live the most enjoyable life possible?

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Image: gaspi*yourguide

Sometimes I realize how really simple the life is. It is so simple. Very simple, but seems like people just choose to complicate it. The reason for me saying is very simple – reality.

Science vs. Religion

I was having a conversation with a friend today about god and realized that we had a lot in common. I realized that science and religion are not that different and only the underlying beliefs make them seem so different. But then a thought struck me.

It doesn’t matter what I believe in or what the other person believes in. Our beliefs don’t change the reality in which we exist. It doesn’t change what is going to happen to us when we die, it doesn’t change how/why/when we, the humans, came into existence.

Truth

I realized the importance of truth. Truth, which is unaffected by our beliefs. Some that is. Instead of arguing people should try and realize “What is?” as opposed trying to prove that somebody is right or wrong. Which is the very basis of all of the problems in the world – people are afraid of the truth, they rather prove that their BELIEF is right, but in all essence that is just cheating yourself. Why not go out and try actually figure out something and answer the question of what as opposed to saying what YOU THINK because that helps nobody.

Your beliefs can harm you and others around, just like thousands of years over religions have shown to us already. Let us put our egos aside and try help each other understand WHAT IS? Because, in reality that is more beneficial to everybody, it eliminates conflict and hatred. Only the truth and search for truth will bring peace and harmony to the world. I am talking about healthy competition, proving your position based on evidence, helping each other out even if you don’t agree with somebody.

If you base your life on searching for truth all arguments will cease, others will have more respect for you, you will stop wasting your time on people who don’t have an open mind and you will turn enemies into friends.

Key To Life

A search for truth and true understand of reality is the key to understand life and living in harmony with everybody. You are in control of only yourself. You can only change yourself. You can change the way you are and the way you think, but it will have no effect on your outside reality. So stop wasting time on trying to change reality and start taking to change yourself to better understand the reality.