Value - Objective or Subjective?

(A shout goes out to Roark for inadvertently suggesting this topic.)

Heres his comment from earlier -

"Yes, gold does have an objective value. It is equal to or nearly equal to the labor required to find it, extract it, smelt it, mint it, transport it and trade it. Correct me if I am wrong. I apprerciate this blog. Roark."

(Thanks for the kind words Roark.)

The idea that values are objective comes naturally, I think, to us as humans. It's an emotional thing like a phobia or an obsessive love. We can point out the rational and obvious truth...that other people do not share our exact values in more or less anything but it never seems to immediately chime with people.

That's my experience anyway. It should be very, very obvious that there are no objective values. Look around. If values were objective, then everyone would eat the same food, they would drink the same drinks, they would wear the same clothes...hmm this is all a bit Chairman Mao, isn't it? (and that's no accident, a belief in objective values inevitably requires everyone behave the same way. After all, if there is an objective set of values for everyone all we have to do is find them and act on them and we have nirvana.)

Each one of us has completely different values to anyone else. You say potaytoh, I say pohtahto. You like strawberry ice cream, I don't. I like chocolate ice cream, you like cabbage. And so on. Who is right?

We both are.

However, having said this, it is worth remembering that people are pretty similar animals as well. While each of us has completely different values, our relative biological similarity will mean that some but not all of our values overlap. In a desert, we will almost all drink muddy water if it's the only thing going. (Yet more Chairman Mao comes to mind.) Some of us might not drink muddy water even then, being in the desert for religious, suicidal or other reasons but it's a fair assumption to say that these people will be vanishingly small in number.

So while values are subjective, there will be enough crossover to fool the casual observer that values are objective, at least in part. Add in the nature of people to copy habits from each other culturally and socially and the illusion is complete.

Returning to Roarks point about gold.........

What is gold worth? And the answer to that question is another question...who to?

To me it's not worth so much. It's pretty boring and not all that tasty. To someone like CGNAO* or Auric Goldfinger it's like a wet dream, the best thing ever....a god amongst objects.

This has an implication when it comes time to trade that gold. If you are offering it to me, I am not going to give you much in exchange for it. If you offer it to someone else you might get more or less for it than I offer. I think this is proof that values are subjective, beyond all doubt.

The amount of labour doesn't really matter, only the individual valuation of those who are in the market for the gold. (Coupled with their ability to give something in trade, of course.)

This has a fantastic implication for peoples interactions. If I offer Roark 1 kilo of silver in exchange for his 50 grams of gold and we agree on the trade we have both walked away better off in our own estimation than before we met and traded. (And if we are ignorant of subjective values we will probably both be thinking that the other guy is a fool.)

And that's about all I have to say on this for now.





*Google it, you'll be glad you did. But these links might help -

http://www.greenenergyinvestors.com/index.php?s=98f92119b4f9e52eaa5543cd0d1f85d6&showtopic=3285

http://www.housepricecrash.co.uk/forum/index.php?showtopic=54046&hl=meltdown