Difference Between Cardinal Utility And Ordinal Utility

Difference Between Cardinal And Ordinal Utility

The main dissimilarities or difference between cardinal utility and ordinal utility can be pointed out as follows:

1. Introduction

Cardinal Utility: Benefit or utility gained from the consumption of certain resource is measurable in numerical value

Ordinal Utility: Benefit or utility gained from the consumption of certain product or commodity is not measurable in numerical value

2. Developed By

Cardinal Utility: Marshall and Robertson

Ordinal Utility: Allen and JR Hicks

3. Claim

Cardinal Utility: It claims that how much utility gained by consuming a commodity be calculated in number value

Ordinal Utility: It claims that which commodity is better can be asked

4. Additive

Cardinal Utility: Yes

Ordinal Utility: No

5. Type Of Approach

Cardinal Utility: It is quantitative approach utility can be measured by number

Ordinal Utility: It is qualitative approach because utility cannot be measured by number

6. Based On/Follows

Cardinal Utility: Utility Analysis

Ordinal Utility: Indifference curve analysis

7. Measurement

Cardinal Utility: Total units of utility (utils)

Ordinal Utility: Level of satisfaction (rank)

   Also Read: 

Difference Between Total Utility And Marginal Utility

8. Realistic

Cardinal Utility: It is less realistic because measurement of utility in number value seems difficult.

Ordinal Utility: It is more realistic than cardinal utility

9. Example

Cardinal Utility: A plate of rice provides 50 utils of utility

Ordinal Utility: A glass of milk offers more satisfaction or utility than a plate of rice.

Cardinal Utility Vs Ordinal Utility (Comparison Chart)

Basis For Difference	Cardinal Utility	Ordinal Utility
Introduction	Benefit or utility that can be measured in numerical value	Benefit or utility that cannot be measured in numerical value
Developed By	Marshall and Robertson	Allen and JR Hicks
Claim	Utility gained by consuming a commodity can be determined in number value	Which commodity is better can be asked
Additive	Yes	No
Approach Type	Quantitative	Qualitative
Based On/Follows	Utility analysis	Indifference curve analysis
Measurement	Utils	Rank
Realistic	Less	More
Example	One plate rice provides 50 utils of utility	Glass of milk offers more utility than a plate of rice

I hope this post is helpful to understand the difference between cardinal utility and ordinal utility and to make comparison between them.