Those who believe value is subjective: what do you mean by this?
Do you mean to say that what is valuable is a matter of opinion or social consensus (group opinion)?
Or...
Do you mean something like "context dependant?"
Or do you mean something else?
Subjective ≠ Arbitrary
ie. The pictures of my son Rad are insanely valuable to me in a perfectly subjective way (no one else feels that way about *my* son's photos), but that doesn't mean i value any random picture that much or there no reason why i want pictures of my son instead of some other kid & I just "decided" to like photos of my son more.
Yes, it is subjectively valuable, but it is also valuable for very real, specific, and non-arbitrary reasons.
–– I think the problem you are having is semantic. All value is subjective, but that doesn't mean it's conjured from nothing and has no connection to reality.
I see your point, I really do.
I can assure you though, that the problem isn't rooted in semantics, and here's why:
Yes, each individual has their own context in which to value things, people, ideas, etc...
... But it's possible for each person's valuation of something to be incorrect, even accounting for their specific context.
Here's an example:
"The free market, made up of individuals making decisions of value at the margin, is better than a system in which a centralized power controls markets/prices.
Why?
Because no single entity can possibly be omniscient enough to calculate every single price accurately enough to sustain an economy for long."
Okay, so in the above example (which myself and most Austrians use) implies objective value. It suggests a link between omniscience and knowledge of value. To be omniscient would be to have intimate knowledge of every person's subjective context. In addition, an omniscient actor would know what to value in each of those contexts. Again, this implies right and wrong answers with respect to what we ought to value.
I don't think I prefer free markets because they're good for me subjectively. I believe free markets are good because when making valuations I want to approximate objective reality, relative to my specific context, and valuing free markets seems to be objectivity better than valuing centralized price control.
Here's another example:
Regret.
One can look back on their decisions/actions (which are really just valuations because action implies value) and realize that what they did was wrong or sub-optimal.
I could strongly believe that walking up to my neighbour and punching him in the face is a good thing. That's a subjective valuation. But in most cases, punching one's neighbour in the face is not a good thing to do, and I would immediately regret the decision. The subjective valuation was wrong in this case.
So, in the case of valuing your child's photographs, I think you are correct that the photographs are only valuable to you and perhaps other family members, but I would argue that they are objectively valuable, relative to your individual context. It makes sense that you value them. It's possible that you'd be wrong not to value them.
All valuations are subjective, but that doesn't mean that answers to the question "what is valuable" are subjective. Does that make sense?
This is Mises Subjective Value Theory.
I'll give this a read, thanks.
Each of us assigns our own value to goods and services. This value is ordinal, not cardinal, for example if I exchange $10 for a hat, it's not that I see that hat valued at $10 (which would be a cardinal value), its that I see the hat more valuable then my $10, and the hat vendor sees the $10 more valuable then the hat.
Also have a look into diminishing marginal returns.
Understood.
Is it possible to make a bad deal and let go of more dollars than you should have for a good you thought was worth the money at the time?
How we value a good or service is based on the available information and our wants at that particular time. For example, if we were lost in the desert with only a bottle of water left, this may be the most valuable thing we possessed at that moment. If however we knew there was a desert oasis just over the next hill, the subjective value of that bottle of water would diminish quite a lot.
Yes, I understand.
But do you think it's possible to evaluate something incorrectly?
As I understand the theory correctly, it's says no. In the moment our decision is deemed rational. The tools we used to evaluate the information and our wants define the value we assign to that good or service. With all things being equal, if in the future our eveluation methods change then the value we assign to a good may also change.
I think I understand your line of questioning. You are exploring the idea that there is an underlying truth to the absolute value of a good and our tools/information are somehow imperfect to find that.
So in short, we're never incorrect about our evaluations, we just change our methods of evaluation, which is likely linked to additional information or an additional insight into our wants.
I struggle to see how additional insight wouldn't be seen as objectively better information. Or an improvement of some sort.
The idea that value is subjective throws into question a lot of our strong intuitions, including our moral intuitions like "It's wrong to shoot up schools."
So yesterday I choose chocolate ice cream, as that is what I liked best, but today my favourite flavor is strawberry, so I choose that. Which one was the better choice?
I don't think we can know with 100% certainty. However, that doesn't mean that a correct answer doesn't exist.
This is why we can look back on our decisions and say "that was a good deal" or "I should've done something better" etc...
Ice cream flavor is a pretty trivial and inconsequential thing to analyze, which is why we don't care to do it. There are more consequential examples we could use, such as cigarettes or bioweapons. Is it actually worth giving up money for cigarettes, or for bioweapons? I'm sure it depends on context, but I do think there are right and wrong answers to that question.
I certainly think that the economy is better off when individuals come to these realizations by themselves, instead of having a central authority dictate them to the masses.
But still, that just means that decentralized economic systems are better than centralized economic systems. It doesn't mean that value itself is inherently subjective.
So you are saying even thou today I prefer strawberry ice-cream over chocolate, that my choice in that moment could be 'wrong'? Wrong in what way?
It may seem trivial, but I'm nearly sure we could still disagree on something as simple as this. Btw, my choice of flavoured ice-cream is not inconsequential. This will have an impact on my quality of life, the ice-cream vendor, and other customers.
Essentially, yes, but it's not my place to tell you or anyone which flavour you should have picked. I believe you are in the best position to determine what you should pick, but there's a big difference between "best" and "perfect."
As for "what way" in which it might be wrong, I do not know. I don't think I understand the question.
As for triviality, perhaps you're right. Maybe your choice of ice cream flavour will have cascading consequences that end up causing WW3 or something. We can't really know for sure.
If I were to accept that the value of ice cream flavours is subjective, then I would have to somehow conceptually make ice cream flavour distinct from other things people can value (that aren't subjective). I don't think that sort of conceptualization exists, and I haven't been able to generate one.
We could play with examples in parallel. One is the ice cream example, perhaps another could be the following:
A Nigerian prince emails you. He promises that if you help him move his multi-million dollar fortune out of Nigeria by sending a certain sum of money by wire-transfer, he will share part of the fortune with you.
You assess the situation and decide to express value by sending the money. Then, the prince vanishes without a trace.
Was that expression of value wrong?
I suggest that it was at least less-than-ideal, or not 100% correct. In fact, I would say you've been scammed.
The alternative is to say that there's no such thing as a "better" or "worse" decision in this situation.
No. This is similar to the desert example. If we had known there was an oasis over the hill, we would've valued our only water bottle differently. Just like if we knew the prince was a fraud, we would've valued our money differently.
As you see there are two distinct examples I'm going with:
1. A change in information about the external world
2. A change in our wants/needs/desires
Your Nigerian price example is more of the type 1 example.
Yes, I agree that there Nigerian prince falls under the first category. I would just phrase it differently to better reflect what's actually going on (in my view).
Better information can help us make better evaluations and therefore, better decisions. This includes economic decisions.
What is the purpose behind seeing a particular action as wrong? I ask this question as I think within Subjective Value Theory, all actions are seen as rational, in the sense that the action at that particular time was based on the only available information. Having some type of moral judgement on that doesn't play a part.
The intent here is a theory that can describe the actions of humans and how each persons actions fit together in the whole. Naval gazing at what could've been (e.g. that I knew the price was a scammer) does not help us get there.
The reason I've come to this conclusion is because without first accepting (implicitly or explicitly) the existence of objective value, nothing else can possibly make sense. No theories, observations, descriptions of the world... Nothing.
The acceptance of the existence of objective value can also explain the question you just asked.
You asked me "what's the point?" You used the word purpose, and you specifically asked about the purpose of viewing something as "wrong."
Asking for the point is to presume that there can in fact be "a point."
If value were purely subjective, there couldn't be a meaningful point to anything. Yes, all valuations are subjective, but those valuations come in degrees of quality. In economics, the market judges that quality though a quasi-evolutionary process (when it's working correctly, but under subjective value theory there is no such thing as "working correctly").
Read my note on subjective/objective definitions. I think this is where the confusion is arriving from. Subjective as in individual context dependent, not biased view of reality subjective.
Yes, you understand my approach. Although "absolute" could imply that a good has the same value always and forever and in every place and circumstance, which I do not believe.
I think everything that could be valued has an absolute value, given the circumstances or context in which it's being evaluated. This is not the same thing as subjectivity in my view.
The theory is interesting, but from what I've heard so far I have to disagree. Still going to read more into it though.
