It definitely comes into play with pretty much any “gear” related hobby, from headphones and speakers, to musical instrument gear, to making a car go faster. Guitar players spend tons of money trying to get that little extra something special in their sound.

It’s unfortunate from a few angles. 1) you spend less time enjoying the stuff that is already plenty good, instead fretting about how it could be better, researching, reading, and otherwise not doing the hobby that one claims to be so interested in. 2) it’s a big waste of money. Some people have a lot of money, but tons of people over extend themselves financially on their hobbies, for increasingly minor ‘improvements’. 3) it can feed a consumerist and elitist mindset in other areas on one’s life. If I’m so discerning about hobby x, then I must be very smart and have great taste, and will need to spend a lot of money in other stuff too.

Diminishing returns is most tangible to me with music instruments, of which I’m most familiar with guitar gear and synthesizer. Everyone Really knows that actually practicing / recording / sing writing is the most important thing to “sounding good”, but it’s a lot easier to obsess about how to spend another $200 or $2,000 and Then I’ll finally feel comfortable and actually write a song.

It’s a little less obviously dumb with headphones, but just listen to music. I know a ton of people on here use AirPods more than anything else because they are convenient and sound fine.

I think there are two different aspects at play here with “diminishing returns”. First, there’s the “objective” evaluation that others have mentioned. Spending twice the money won’t give you a soundstage that’s twice as wide, for example. Twice the money won’t get you headphones that give you twice as many details. So in terms of these “technical” attributes, there are diminishing returns on how much more of any one quality you can get from spending more money.

On the other side, there’s another subjective factor working against these “diminishing returns”. I’m sure there’s a psychology term for it, but I’ll call it “the princess and the pea” effect. It comes from the fairy tale of the princess and the pea, with the idea being that a princess raised in luxury and comfy beds would find even a single pea under her mattress to be uncomfortable, while a person raised in normal circumstances with average beds wouldn’t notice that pea. Once someone is beyond the point of diminishing returns, what often happens is that the small objective differences in performance make large differences in that person’s enjoyment. That’s where those 5% differences will make or break someone’s enjoyment of a headphone.

My most recent example of that pea effect is when trying out the Stax SR-X9000 vs the Dan Clark Audio Corina at Capital AudioFest. Both of those headphones are extremely good. If I were to compare them side-by-side in any “objective” quality, they’d come out pretty close. But the Stax was just ever so slightly more open and layered in its positioning and imaging of sounds, and ever so slightly more reverberant with the trailing ends of notes, and slightly more relaxed and airier in its tuning, such that I found it significantly more enjoyable than the Corina. Again, they aren’t that different in absolute performance levels, but in terms of my personal enjoyment of music, it wasn’t even a contest, I’d pick the Stax every day and twice on Sunday (another funny English phrase).

After $1000 I would rather buy speakers

Well point of diminishing return = abnehmender Ertragszuwachs

The law of diminishing returns is an economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other variables remain at a constant.

It’s in everything

Racecars where you are spending millions to save a 10th to the performance of computers where the flagship components are double the price for like 3% more performance…

At least you can say “Porsche” properly :p

I think among audiophiles the term “diminishing returns” is more for people who are new to the hobby because when they buy their first mid-fi or hi-fi set coming from Airpods or budget IEMs the jump is massive. Then they jump up another tier and the *wow* factor is gone because it’s only a 10 or 20% increase from what they already had.

Someone who’s been doing this for a long time already knows that improvements are often small and subtle, even if they’re expensive. And it really is true for any hobby. You’ll hear plenty of people in this sub say anyone who buys an expensive amp is stupid because they all sound the same. I and anyone who listen to these things regularly knows that’s not true, but I feel the same way about, say, fancy tires on a car.