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I must echo Robin Neill's earlier puzzlement about this whole conversation.  There seems
to be an underlying assumption that utility is a "thing" that can be "measured," and that,
more specifically, it is connected with a subjective feeling (a hedonic conception of
utility) that neuroeconomics could pinpoint.
 
>From an Austrian perspective, this whole view is misguided.  Utility is not measurable,
cardinal, or hedonic.  If I may quote myself from my chapter on the Austrian Marginalists
in the Blackwell Companion to the History of Economic Thought:
 
For Menger, the subjectivity of value is what underlies his discussion of marginal
utility.  It is only after he has defined value that he moves on to talk about utility.
In defining utility, he simply refers to it as "the capacity of a thing to serve for the
satisfaction of human needs, and hence (provided the utility is recognized) it is a
general prerequisite of goods-character" (1981 [1871]: 119).  In Menger's conception of
marginalism, utility is not understood as a cardinal value that can be totalled up, nor is
it even anything "measureable" in any meaningful way.  It is, as Menger notes, understood
as a "capacity," and one that is in the eye of the beholder.  Utility is not the same as
value, as value can only be applied to economic goods.  Utility is therefore necessary for
value, but it is not sufficient.  Non-economic goods have utility but not  value, as they
do not figure into the economizing decisions humans make.  More precisely, non-economic
goods are ones where "the satisfaction of human needs does not depend upon the
availability of concrete quantities of [them]" (1981 [1871]: 119).  Non-economic goods
like air do not have to be judged in terms of specific concrete quantities, rather they
are ominpresent in some sense.
 
If the Austrian view is correct, and it may not be, the search for utility as a measurable
hedonic in the brain is fruitless.  Utility is just the economic actor's judgment of an
object as having the capacity to help her achieve some end.  Value is what happens when
utility meets the economizing decisions of human actors.
 
Steven Horwitz 
 
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