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twanvl comments on What Cost for Irrationality? - Less Wrong
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Human beings don't eat money. Your utility/money curve depends on the prices of things you can buy with the money, and the relative utilities of those things. Both factors can vary widely. I know no law of nature saying a $1000 gadget can't give you more than twice the utility of a $500 gadget. For the most direct example, the $1000 gadget could be some kind of money-printing device (e.g. a degree of higher education).
That is (or should be) the reason why people to borrow money. You borrow if the utility gain of having more money now outweighs the loss of utility by having to pay back more money later.
But note that utility becomes more complicated when time gets involved. The utility of a dollar now is not the same as the utility of a dollar next week.