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> Econ 101 time: value is subjective. Human beings merely use value as a description - it does not exist inside of any object or inside of any equation Econ 20

> Econ 101 time: value is subjective. Human beings merely use value as a description - it does not exist inside of any object or inside of any equation Econ 201 time: value is concrete, the definition of value is subjective. I can say that the value of two exchanged objects are concrete - that they have the same embedded value.

rabuse 4y ago
What is the point of this statement exactly?
skybrian 4y ago
That's a simplifying assumption used to make the accounting practical. But knowing that someone bought something on Amazon doesn't tell you how much the buyer would have paid or how low the seller would have been willing to go. (There are gains from trade and who gets them depends on negotiations and the competitive situation.) Also, one or even both of them may have made a mistake. People return things they purchased all the time, and they may regret purchases they don't return. We are fortunate that for many kinds of goods, we usually don't have to pay the full value of what we buy, due to competition.
gweinberg 4y ago
No,that's econ negative 1. People don't exchange things because they are of equal value, they exchange things because each feels himself better off after the trade.
- imtringued 4y ago
  That means money makes us lazy because it is superior over goods and we feel worse off when we give up liquidity.
  - pas 4y ago
    and that's certainly happening. money now is better than money later (time value of money, net present value discounting), during economic downturns people don't start buying the dip like there's no tomorrow, even though it's very likely that they would make bank in 5-10 years. (because people are risk averse) similarly we are bad at managing spread out risks (climate change, road traffic incidents)
  - boredhedgehog 4y ago
    That's why we impose inflation on the money: to make it rot at a comparable rate.
- throwawaymaths 4y ago
  Give the guy a break. Everyone from Aristotle through Adam Smith and marx made this mistake.
- AussieWog93 4y ago
  That's econ negative 2. Most transactions below $100 or so basically happen because monkey brain like shiny banana.
  - egberts1 4y ago
    Econ -3: there is no spoon.
ekianjo 4y ago
There is no concrete value. Water has no value in a desert if nobody lives there.

rabuse 4y ago

What is the point of this statement exactly?

skybrian 4y ago

That's a simplifying assumption used to make the accounting practical. But knowing that someone bought something on Amazon doesn't tell you how much the buyer would have paid or how low the seller would have been willing to go. (There are gains from trade and who gets them depends on negotiations and the competitive situation.) Also, one or even both of them may have made a mistake. People return things they purchased all the time, and they may regret purchases they don't return. We are fortunate that for many kinds of goods, we usually don't have to pay the full value of what we buy, due to competition.

gweinberg 4y ago

No,that's econ negative 1. People don't exchange things because they are of equal value, they exchange things because each feels himself better off after the trade.

imtringued 4y ago
That means money makes us lazy because it is superior over goods and we feel worse off when we give up liquidity.
- pas 4y ago
  and that's certainly happening. money now is better than money later (time value of money, net present value discounting), during economic downturns people don't start buying the dip like there's no tomorrow, even though it's very likely that they would make bank in 5-10 years. (because people are risk averse) similarly we are bad at managing spread out risks (climate change, road traffic incidents)
- boredhedgehog 4y ago
  That's why we impose inflation on the money: to make it rot at a comparable rate.
throwawaymaths 4y ago
Give the guy a break. Everyone from Aristotle through Adam Smith and marx made this mistake.
AussieWog93 4y ago
That's econ negative 2. Most transactions below $100 or so basically happen because monkey brain like shiny banana.
- egberts1 4y ago
  Econ -3: there is no spoon.

ekianjo 4y ago

There is no concrete value. Water has no value in a desert if nobody lives there.