The Value of Means

 

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Table of Content see: 

001 - Table of Content and Introduction

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Transcript:

Man, Economy and State 2009, chapter 1, pages 17-21

We already heard about ranking needs along a value scale.

The value of this scale could be called happiness, welfare, satisfaction or utility.

Human actors value their means according to their personal ranking of needs.

The value of a good is therefore not in relation to the costs of production, or the amount of labour put into the good.

If we ignore for a moment the valid need for novelties and works of art, a human actor would not care if it took three weeks of labour to cook a soup of dissolved diamond-ash.

Especially if it tasted bad and did not nourish, the diamond-ash soup is worthless for most actors.

Value is only determined from a human actor who appraised a good according to the needs fulfilled.

Another example is the orchard.

Its value is not determined by the land, the growth time or even the trees themselves, but by the expected yield of apples and their value as consumption good or as factor of production.

 

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Man, Economy and State, Murray Rothbard, 2nd Scholar's edition, Copyright 2009, Ludwig von Mises Institute, Auburn, Alabama: E-book and audio-book on mises.org

 

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