French economist Jules Dupuit is credited with introducing the concept of consumer surplus in an 1844 article about the utility of public works.
Dupuit studied how to evaluate projects such as roads and bridges, especially when users paid tolls. He recognized that different travelers might be willing to pay different maximum amounts for the same service. If a toll is set below a traveler’s maximum willingness to pay, the difference represents a benefit to that user.
Modern economics calls the total of those differences consumer surplus. On a conventional demand graph, it is represented by the area below the demand curve and above the market price, up to the quantity purchased. The idea helps economists compare the benefits consumers receive with the revenues or costs associated with a project.
Alfred Marshall later popularized and formalized the term in English-language economics, so he is sometimes incorrectly credited as its originator. Dupuit’s 1844 work predates Marshall’s major economic writings and is widely recognized as the earlier source.