Utility theory (economics)

Utility theory is the observation that as an individual earns more money, the utility of that money (that is, it's usefulness) is diminished exponentially the more they earn.

Explanation
Although each individual has a different minimal needs criterion to survive, the usefulness of money diminishes the more someone earns to the point the returns are ill-contrived to the gains.

For example, a person with no money would initially benefit from a monetary stream in that they could purchase food, water, housing and suitable minimal needs items to survive.

However, an individual who already has their minimal needs covered with income will find any additional money has less and less useful returns to them, ultimately being spent on non-utility items, such as luxury goods and duplicate items (such as additional houses and additional cars). This eventually leads to item waste and thus negatively disbalances the availability of other items for other people (IE, a person with additional homes will cause the house market prices to increase as availability to match demand reduces).

Extremely excess income streams ultimately results in the individual having more money than they could logically or reasonably spend, which either produces a lot of money waste, or if horded, restricts the money cycle flow.

Suggestions to economics
Utility theory basically demonstrates that unlimited earning potential, is in-fact, a bad thing in that money beyond a critical point loses any practical benefits to the individual. It implies that the excess financial gains that go beyond the critical point would be need to be allocated to other people, or the earning potential simply incapped.

A naturally occurring example of monetary excess being incapped is the banker bonus cap. Taxation is also a form of utility theory in that excessive earnings of companies and corporations is collected and reallocated into the public. Finances that, if they weren't so reallocated, would have little utility being stored in a bank account.

Also, utility theory suggests that tax evasion and off-shore bank accounts negatively affect the economy in that the money cannot re-enter the money cycle, either via taxation (which would increase it's utility by benefiting the public) or via spending (which would allow the money to re-enter the money cycle and allow other individuals to increase their earning income and thus the money's utility).