Summations Only

A penny for your thoughts ...

And cowry shells. With the trifling exception of all the nations where this hasn't happened.

Well, good luck with that. From which it follows that the value created when a slave produces one bale of cotton is less than the value created when a paid worker produces exactly the same thing. So corporations could create even more value by entering into secret illegal trusts to jack up the price. Why do we stop them doing that? After all, creating value is good, right? No.Your definitions equate creating value with getting one's hands on the money. Indeed, it would seem that the quickest and most effective way to create value would be to rob a bank. The profits are high, the costs are low, and you can do it in an afternoon. No we can't. You're simply equating the money one grabs with the value one has created, and so you have defined the concept of ill-gotten gains out of existence, since the value one creates is always exactly proportional to the compensation one receives, since they're the same thing. No gains are ill-gotten. The originator of a Ponzi scheme, for example, has created value. We know this because he ends up sitting on a big pile of money. He has produced no goods, and the "service" he has provided is a dubious one but he has enriched himself, and therefore deserves the money, which is the value that he created.

Surely you must find that question very easy to answer. The value of free software must be zero, the same as its price.I myself would find it more difficult to put a figure on it, but I don't see why you would have any difficulty.

I never referred to the morality of slavery, only its lower overheads.But it seems silly that the value created by someone creating one bale of cotton is different from the value created by someone creating exactly the same thing. The two bales are equally valuable, because they're identical. I would in fact object if you refuse to also defend the logical implications of the positions you hold. If the value you create is the same as the money you grab, then a maneuver that allows you to grab more money means that you're creating more value.Suppose, for example, that a cartel can make more profit by producing less goods, thus raising the market price per unit. By your system of accounting, it follows that by doing so, they are creating more value than if they made as many goods as the market would like. Apparently the creation of 100,000 widgets creates more value than the creation of 200,000 widgets (so long as the former is more profitable) because the value of the widgets inheres in the profits and not in the widgets.Which, again, seems silly.Edited by Dr Adequate, : No reason given.

Oxygen is therefore worthless, though I doubt you'd be willing to go without it.

Unless by some chance they have limited liability, y'know, like shareholders do. Unless their liability was limited too.

No it isn't. That's the price. The value is something different. A company using Open Office isn't getting less value than someone using Microsoft Office (assuming for the sake of argument that they're equally good for what the company wants to do with them). They're paying a lower price.Imagine a CEO addressing a shareholders' meeting: "Both Open Office and Microsoft Office would equally meet the needs of our business. However, Microsoft Office is more valuable, because we'd have to pay a million dollars a year to license it whereas we'd get Open Office for free."At that point the shareholders would complain that their CEO didn't understand the difference between price and value. And then they'd throw rocks at him.---Value and price are different things in the English language as she is spoke. For one thing, your way would render the phrase "better value for money" meaningless, because every product would have the same value for money, namely one dollar's worth of value per dollar of money spent. And yet the concept of value for money is of considerable importance in understanding economics. Two for the price of one, for example, is better value for money than the regular price, which to me explains why people are attracted to such offers --- unless we equate value with price as you do, in which case when the retailers halve the price per unit they also halve the value, and people's attraction to such offers becomes an inexplicable irrational preference.Similarly, if you had your way, we would not be able to say: "person X is overpaid" or "you paid more for Y than it was worth" or "company Z overbid for the contract".---Continuing that line of thought, it would also become rather difficult to evaluate the judgement of executives. Consider for example Dick ("Guitar groups are on their way out, Mr. Epstein") Rowe. Many people would say that he made a mistake by not signing the Beatles. But no, his judgement was perfectly sound --- he was not willing to pay any money for an opportunity which was quite valueless. How do we know that it was valueless? Because he wouldn't pay any money for it. His decision was economically correct because he made it.---Consider, now, the Gates Foundation. What account should we give of it? In your new jargon, we should say that Bill Gates is a man who goes around destroying the value of vaccines. They have value when he buys them from pharmaceutical companies, and they have no value when he gives them away for free.But in plain English, the value of a vaccine inheres in the fact that it prevents people from getting ill, and the way to remove value from a vaccine would be to denature it so that it no longer has this property. In plain English, what Bill Gates is destroying is not the value of the vaccine, but its price.---And what account are we to give of inflation? In ordinary economic terms, this involves the price of goods going up, and the value of the dollar going down. But if value is price, then inflation involves the value of goods going up, and a potato is now (let's say) ten times more valuable than it was in 1950, without any improvement being made in the potato. The value of the dollar, however, has stayed exactly the same --- it is still worth one dollar per dollar, just like it always was.---Price and value are different things, both in plain English and in any economic theory that can even get close to explaining economic phenomena. Price is what people pay for a thing, and value is what people get out of having it.Edited by Dr Adequate, : No reason given.

Whereas the dollar has not undergone a similar fate, because this does not invariably happen to fiat currency. "Brass" (actually, copper, look it up) didn't maintain its value? How come? It's made out of metal, like silver, it's shiny, like silver, and it possesses intrinsic value. To this day, people use it for practical purposes such as making electrical wiring, which makes it superior to, for example, silver. So what went wrong?Edited by Dr Adequate, : No reason given.Edited by Dr Adequate, : No reason given.

No. Ethics hardly comes into it. Free software might be used by SPECTRE in their quest for world domination, which would be a bad thing, but it would still be valuable to them. But if you go on reading, you'll see that there is no unanimity amongst economists that economic value is the same thing as price. And I think I have shown good reasons why. It seems absolutely paradoxical to maintain that free software has no economic value because you don't have to pay for it. To be sure, it has no economic value to the producer, who is giving it away, but it has value to the consumers, who are (one assumes) more productive for having software than if they had none.WP goes on to say: The software is valuable in this sense. The fact that it is free does not remove its value, that's the icing on the cake.

Right. So when a company decides to allocate a little time in installing Open Office, rather than a little time and a lot of money in installing Microsoft Office, that's a "choice that involves tradeoffs in allocating resources". This choice is not made on the basis that Open Office has no economic value because it's free.In general, when people make such decisions, they do not equate economic value with price, because if they did, as I have pointed out, they would find that any purchase gave them equal value for money. I don't know exactly how GDP is calculated, but if this is true, I would say --- what of it? The question of whether it has economic value has nothing to do with whether someone using a particular method of accounting takes this value into account.If I maintained that it required intelligence to learn a foreign language, would it be a good refutation to reply that IQ tests don't measure this capacity? I might say --- well then, so much the worse for IQ tests. But that is patently what it means. If you mean something different, such as that it is free of charge, then you should say that.Why muck about with language in this way? We have words, such as "price" which mean things such as price. Nothing but confusion, ambiguity, and nonsense is produced by equating value with price. I know what neoclassical economics is. I have proved several original theorems in that particular branch of mathematics.Edited by Dr Adequate, : No reason given.

This is, as a matter of fact, true. That is indeed how "the benefits of these improvements accrue". But does it follow that this represents justice? After all, the benefits of a mugging accrue to the mugger, whereas the victim of the mugging loses out. According to your jargon, the mugger has "created value" by getting the money, whereas the victim has destroyed value, by handing it over. So the mugger should be rewarded for creating the value, by getting to keep the money, whereas the victim should be punished for destroying value, by losing it ...

Well, this has been explained to you. The shareholders can be "wiped out" by the failure of their investment, unless they live in the real world, in which case their legal liability is limited by their investment. But now imagine that they live in the world in Percy's head instead.

But this advantage has no economic value, because ... ?

And yet companies are capable of setting at least an approximate price on "favorable legislation", because they are willing to pay Congressmen actual money to get it.When a company spends so many million dollars per year to lobby Congress, this does appear on their balance sheet.