How can I effectively write of a book character who slowly descends into madness?

 The answer depends on how you are portraying that character.

If you are using first person point of view and are showing the world through that character’s eyes, then you gradually describe the world and the people in it as if the world and everyone in it is changing and the character is having more and more trouble adapting because it’s not that character’s fault, it’s the world that’s gone mad. Because that’s usually the way people with mental illnesses see themselves and the world. They are right, the world is wrong.

If you are writing from third person point of view, it’s a little more difficult because you must show how that character sees the world changing until the entire world has gone mad and he/she is the only sane person.

So it’s all a matter of description. Normal versus abnormal. Sane versus insane. But all the time remember that the person losing their mind doesn’t realize it’s happening, just thinks that everyone and everything else is going wrong. At least that’s the case with almost all mental illness so it’s most likely the way a reader would expect to see it happening in a story.

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