Mario Villarreal is a professor and Research Chair in Strategic Intelligence at the Public Policy Graduate School at the Instituto Tecnológico y de Estudios Superiores de Monterrey in Monterrey, Mexico, and an Affiliated Senior Scholar at the Mercatus Center at George Mason University.

Why are diamonds more expensive than water? Prof. Mario Villarreal‐​Diaz answers this question using what economists call marginal analysis. Essentially, the marginal utility of water decreases faster than the marginal utility of diamonds. Put another way, people face decisions in a particular context and time. In modern economies, people have ready access to water on the margin, but do not have the same level of access to diamonds.

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