Is there such a thing as absolute value?

[TiagoTiago]

Is there somthing that never changes value, like somthing you could use to evaluate how much a currency is worth at any point in history without being relative to other currencies nor the price of a BigMac nor anything, somthing that has the same (non-zero) value for anyone at any point in history? Or you can't give somthing value without considering how it's value compares to the value of somthing else?

[Vandroiy]

Determining inflation. This is a very complicated problem, with many opinions on it.

Some people like to gather a large set of different goods which were similarly easy to produce in past and present, and then compare e.g. a median price. This is a method I would use.

But I am not an expert on this. Apparently, many institutions, especially governments, have an incentive to construct flawed methods of determining real value and thereby inflation -- to be able to hide it.

[wareen]

The concept of value you are probably referring to is purely subjective and therefore I think no absolute value can be defined. Things like gold for example have a reputation of being considered as valuable throughout the history but there were times and societies which did not value gold very much either.

If you are really looking for "absolute value" then you would have to resort to something based on physical laws because they at least seem to be the only thing absolute in this universe. Take for example energy for a non-inflating value system or entropy for an inflating one (good luck with creating a currency based on entropy )

[hugolp]

Is there somthing that never changes value, like somthing you could use to evaluate how much a currency is worth at any point in history without being relative to other currencies nor the price of a BigMac nor anything, somthing that has the same (non-zero) value for anyone at any point in history? Or you can't give somthing value without considering how it's value compares to the value of somthing else?

No.

Long answer: Value and price are different things. Price is the reflection of value. But things can have value and no price, for example something with emotional value that you refuse to sell (although some would say that the problem is that nobody has offered you a high enough price). Anyhow, the price is maybe the best reflection of value.

As someone has stated before, value is subjective. Value is a human decision, and its different for everyone. Without a human valuing it an object has no value.

And now answering your question: there is no absolute price. Everything floats in respect to other objects. You are always pricing things in another object. F.e.: I will change you one caw for three sheeps, I will change you this car for a sex night with your girlfriend (interesting valuation here), I will change you a computer for a $600, I will change you 10 euros for 1 bitcoin, etc... Because this can be a mess, people end up using one object as means of exchange and exchanging everything against this object. This has been many things, like tobaco, sea shells, salt, spices, etc... but universaly and cultures without contact have end up selecting precious metals, specially gold and silver, because of its qualities. This object its what we call money. The benefits of having a few objects acting as means of exchange is that it allows for economic calculation and a pricing system that is what allows economic coordination in the division of labour and allows human progress.

[TiagoTiago]

Entropy-coin? Nice!


Hm, converting dollars, gold, carrots etc into a Planck based unit in such a way that their exchange rates are respected without the assistance of arbitrary constants? That does sound like an interesting challenge...

[neptop]

No, there are two reasons for this. Neither determinism, nor truth does seem to exist. I know, it's a short answer, but you could write books on that and I don't intend to do so.

And then there are two other reasons, but I am not sure whether they apply to everything and I guess that's not what you meant when you wrote your question.
Values are also a lot (even more than one might think at the beginning) about psychology.
Values are not always about numbers, even when it comes to very basic goods.

[Bazil]

I made a post about this on my blog.  I think there can be, or at least a highly stable value:

http://www.thefashionablephilosopher.com/politics/a-monetary-unit/

[BombaUcigasa]

No, there are two reasons for this. Neither determinism, nor truth does seem to exist. I know, it's a short answer, but you could write books on that and I don't intend to do so.

I vote Yes. I know it's a short answer but this is not philosophical theory, it's reality. Even at the lower levels of an entropic Universe such as ours, you can measure everything as energy potential. Old books, old paper bills, aluminum coins, car fuel, uranium, plastic bottles, sugar, wood and the binding and unbinding of these items has a positive or negative energy cost.

If you want a grow, evolve and reproduce, you need to consume more energy than needed, such that everything on your immediate surroundings has an energy value associated with it, and you try to find the lower path of cost. There are localized reversals, or mitigated costs or even cost prevention reversals but in the end we have the topic at hand:
- to get a bitcoin, you must either go in line with everyone else that wants it NOW and pay the market price, or
- expend energy in the form of binded (coal, nuclear, oil) or continuous flow energy (solar, wind, hydro) and time (computation complexity) to obtain one

It is impossible to get bitcoins at no value, there is an absolute low level of energy that needs to go into the creation of a bitcoin, even abstracting time and everything else except radiated heat in the most efficient mining processor. Oh, and this base value grows with each difficulty step.

[Jack of Diamonds]

Necessities do have absolute value.

These include food, clean water and in some cases housing (though many people in the world live on the streets). People are always willing to invest a certain amount of their income in those things, because they are required for sustaining life (unless they are self-sufficient farmers). People that refuse to, will die, or will have to resort to the charity of others, or stealing.

Bitcoins, gold, home theatre systems, computers, jet ski's and desktop fans have only arbitrary value.
Anything beyond the initial cost of labor+materials is just a percieved value due to their utility, rarity, etc., but everyone in the world can survive without them and has survived for thousands of years.

Nobody can survive without nutrition or drink though.
Clothing and shelter are very critical needs as well, depending on the climate they might have absolute value as well (especially in colder countries).

[TiagoTiago]

Some people would pay to have bugs moved as far as possible form them, while others consider bugs a nutritious meal, some people pay lots for fancy dishes, others vomit just thinking of eating such things; some people refuse to eat most types of food, including going hungry if that's the only choice; some people will eat anything that is at hand, but not lift a finger to go after food that is not avaiable. And besides personal taste and culture, value of things like food is severely influenced by supply and demand; a grape in the middle of the desert is worth way more than one in the middle of a banquet.

[Jack of Diamonds]

That's true. Everyone needs to eat something though, even the camel riding merchant with the single grape, or a baron at a banquet.
While food has relative value in these scenarios, food is worth *something* to everyone.

Bitcoins or gold bullion are only worth something to people who choose to buy them either as an investment, curiosity or shininess (gold).
Most people have no utility for either of them even if the market price is thousands of dollars.

However, every single person in the world has utility for food.

[Fakeman]

While necessities of life are never valueless, even in the case of something like air which we usually don't pay for, that's not quite the same as having a constant value in a monetary sense. How much water can you get for a pound of salt? Nobody can live without either, but their relative values are certainly not fixed in a monetary sense. No single commodity can serve as a reference value for everything else.

[kjj]

I guess it might be possible to create a unit of absolute value.  But the price of everything in relation to it would always be shifting.

[hugolp]

Necessities do have absolute value.

These include food, clean water and in some cases housing (though many people in the world live on the streets). People are always willing to invest a certain amount of their income in those things, because they are required for sustaining life (unless they are self-sufficient farmers). People that refuse to, will die, or will have to resort to the charity of others, or stealing.

Bitcoins, gold, home theatre systems, computers, jet ski's and desktop fans have only arbitrary value.
Anything beyond the initial cost of labor+materials is just a percieved value due to their utility, rarity, etc., but everyone in the world can survive without them and has survived for thousands of years.

Nobody can survive without nutrition or drink though.
Clothing and shelter are very critical needs as well, depending on the climate they might have absolute value as well (especially in colder countries).

This is aparently a very intuitive though, but only aparently, because it does not describe reality.

Lets try a very simple though experiment: Imagine a farmer with all his food necesities covered for months. Suddenly his daughter gets ill and he needs a car to take her to the doctor. But he does not have a car. Now someone comes and offers him a car and a lot of food. What do you think he will value more in that moment? Supposedly food has absolute value while the car does not, right? Still, he would choose the car. How can that be if food has absolute value?

In reality, what do you mean by food having absolute value?

[TiagoTiago]

I guess it might be possible to create a unit of absolute value.  But the price of everything in relation to it would always be shifting.

LOL, good point

[Fakeman]

Just mint coins that contain every non-radioactive metal, in the proportions that they are found in the earth's crust. That should be close enough.

[myrkul]

I donno... we might be able to create a unit of ... I won't say value, maybe worth would be a better word, defined as the chemicals required to keep one human alive for 1 day. This would be constant, at so many pounds of O₂, so many mL of Water, and various amounts of macro and micro nutrients.

As previously stated, though, once we had this constant, everything else would then shift in relation to it.

[BombaUcigasa]

Just mint coins that contain every non-radioactive metal, in the proportions that they are found in the earth's crust. That should be close enough.

What do we call them? Dirtcoins? I think if we do what you suggested, we will finally destroy this poor planet...

[Jack of Diamonds]

In reality, what do you mean by food having absolute value?

The car has only temporary value because the farmer's daughter is sick. But when she gets better, the car becomes useless if the farmer's family doesn't need to travel or they are happy with horse carts or walking.

However, they will always need their harvest or other sources of food to stay alive. The need is constant as long as someone in the family is alive. Hence it is always worth a certain portion of their income that they are willing to part with (be it 2%, 5% or like in many poor countries, over 50% of their income will go into food)

Unless material replicators or other sources of synthetic food are invented, food will always be a commodity that has infinite demand (as opposed to other commodities which only have limited, increasing or diminishing demand, such as certain consumer goods) but only a limited supply.

You could argue Bitcoin and gold are limited in supply as well, which is true, but they do not have infinite demand over time (infinite meaning as long as humans are alive), at least yet. They are not essential to the vast majority of people.

Therefore a thing of absolute value must be something that has a worth for everyone.

[Fakeman]

Just mint coins that contain every non-radioactive metal, in the proportions that they are found in the earth's crust. That should be close enough.

What do we call them? Dirtcoins? I think if we do what you suggested, we will finally destroy this poor planet...

Why would that be? There is economic demand for every element anyway. Of course, it would be very difficult technically to make such coins if you really tried.