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Incorrect, value for the seller almost always is less than price and for the buyer almost always in excess of price thus creating the mutual benefit that underl
by fleitz 10y ago
Incorrect, value for the seller almost always is less than price and for the buyer almost always in excess of price thus creating the mutual benefit that underlies most transactions.
- stevetrewick 10y agoA sadly little understood point, and true of all voluntary trade. If A has a chicken and B has a pig and they decide to trade then for A, value[pig] > value[chicken], while for B value[chicken] > value[pig]. By exchanging both profit. Trade is a positive sum game. But this also illustrates that value is entirely subjective. AIUI prices are generally determined by market clearing - matching supply with demand. This is not at all the same as there being some objective notion of value. At best you could get 'in general prices are slightly lower than the value sufficient consumers place upon a good to clear the market for that good', but that's a much less general statement.