First apologies for my English. OK, your "refutation" of the candy bar example and thus the "refutation" the Economic Subjectivism itself says:
>> This argument would be rejected by opponents of economic subjectivism, who would see the determining factor in the value of the candy bar as being the amount of labour or effort that went into producing it. They would note that the candy bar would still cost the same in the local store, whether *you* were hungry or not...
IMHO this is not the correct interpretation of the Economic Subjectivism standpoint. Although Subjectivistic Standpoint is methodologically individualistic, the value of the candy in the local market is *not* determined by solely one individual (well, it is, if there is only one potential buyer available there). It is rather determined by subjective evaluations (based on individual needs and wishes as well as attitudes that can be influenced by advertising) of *all potential* (not solely one of them) buyers toward the specific brand of candy bars available at specific time (as potential buyers take into consideration the time factor as well when they evaluate the value of that candy, as some of them evaluate the candy higher if it will be sold before they can get to the store, and are prepared to pay more for it if someone near the store can buy it for them) in the specific local market.
A Reader from a Post-Communist country
Though your text does not mention it, is this not the prevailing attitude of all modern economists? It is my impression that economic intrinsicism is as thoroughly discredited as Lamarckism in biology, but this text makes it sound like there are still adherents.
I agree with LDC on this one. I don't think anyone has seriously held an intrinisic theory of value in economics in a long long time. Certainly, modern mathematical economists, with utility theory and all that stuff, are thoroughly 'subjectivist' in the relevant sense.
I will go change the text now.
It is mentioned in the article that the changed value of the unchanged candy is a paradox. That seems superficial to me. Value = exchangeability, and is a relational function, not a property of the thing nor of the valuer, but of the relationship between the two. A thing of poor quality may have properties which reduce the likelihood of its being widely or highly valued, but the destitute may esteem it highly. Likewise, a wealthy and privileged individual may be unwilling to part with any portion of his considerable wealth to obtain a 7-11 franchise, while a struggling entrepreneur might give up 75% of his net worth to get it. So, as value is a function of relationship, it should not be surprising that candy exists in one relationship to a famished individual, and in a totally different relationship to a stuffed individual. Just as the top of the empire state building is high to a sidewalk dweller and low to a commercial jet passenger, high and low are relational values and it presents no paradox that they are viewed differently from different perspectives. My $.02.
If no one minds, I will change the text.
I'm not particularly fond of the "candy" example either. Here are some others: Two artists expend equal amounts of labor making paintings, sculptures, whatever. The one whose art is popular for some subjective reason will get far higher prices for his work. Even releative values change with technology: I'm sure all of us have spent a month's labor or more on a computer that is now a doorstop. The computer didn't change--it's just now worthless because we can get a more powerful one for a day's labor now. --LDC
I think this article is getting too dismissive of the labour theory of value. There are still significant schools of thought (eg Post Keynesian economics, not to mention many maxists, post marxians and the rest) that reject elements of economic subjectivism. Hence the change from 'virtually all' to 'mainstream' economists endorsing subjectivism.
I also added a quick refutation of the candy bar example, which was almost too easy - I agree that the example of the artist might be better, though still open to conflicting views.
With the example of the computer capital good is being used along with labour to do work. Proponents of the labour theory of value have gone to great pains to make the theory fit with the existence of capital goods - it's not for nothing that Marx called his major work 'Capital'!
I've never heard the phrase "economic subjectivism" and I think it is just a claim by certain economists, e.g. Hayek, von Mises, to have an insight into what is objective versus subjective that no one else has.
In other words, it isn't really separable from other varieties of libertarian (or "neo-classical") economic theory, adn should be integrated into a general description of the motivations and rationales of libertarian parties advocating free-market economic policies.
I did my best to represent this point of view fairly in political economy - making note of the suspicion that libertarian theorists have of any top-down assignment of conversion values between social, infrastructural and instruction capital in particular (where their criticism seems very valid). The exact phrase was
"Most [libertarian parties]? thus advocate a totally liquid or free market or laissez-faire? form of capitalism which permits trust, instructions, and infrastructure to find relative values in an open market of equal players."
I didn't make note of similar assignment between financial, natural, and individual capital (where I'd say the greens have them by the balls). The more libertarian [political economy] gets, the more green it has to get in contrast.. to stay neutral.
So, there is at least a libertarian and green view of what is "objective" versus what is "subjective", and no doubt the various chorus of socialist and capitalist views can chime in to dispute both.
Whee... ain't political economy fun?
The term is a very common one in present academic use for exactly what the article describes, especially when used in connection with the Austrian school. If you haven't heard of it, then you haven't taken many of those courses. This is a very good article, and accurately describes the present academic understanding of a simple topic, in a way that is totally neutral to the controversies surrounding it. Feel free to clutter up the talk page if you must, but please don't mess the article up with commentary. --LDC
I wouldn't dream of adding commentary to the article, as I don't know anything about this usage, and it needs space to present itself - it's not as if there is any great clamor to overload this term, unlike oh say "capitalism" or "green" or "free" or "fair"...
I'm *not* criticizing the article nor the field, but the mind-set behind it. If you say it's so different it needs its own article, fine, I don't disagree, I made that point myself over and over re: "green parties" vs. "green" vs. "Green" etc... huge integrating views of the world and the nature of life and inter-relations of living beings are hard to contain in one article each... I wouldn't expect libertarians nor socialists to make whole schools of economics into side notes... although I do think that if a theory makes sense it can be expressed in a quite short space, e.g. F=MA...
As to "totally neutral to the controversies surrounding it", that's tough. My idea of "totally neutral to the controversies surrounding it" is political economy. But of course some people think that this is giving too much space to socialist claptrap, capitalist claptrap, libertarian claptrap, green claptrap, etc... what can ya do?
That, too, is "economic subjectivism", but I'm not asking for those links...
I'd rather see an explanation of real events in the news, like Enron or the collapse of Arthur Andersen... in terms of this "economic subjectivism" theory.
Such a thing might well be interesting. But this is an encyclopedia, not a discussion forum. As I said, the term "economic subjectivism" is a term of art--it's a phrase used in a a psecific context with a specific meaning, and that's all it is. It isn't meant to have all those other connotations you want to attach to it--it's no more complex than saying "bug" means "error" in the context of computer programming, and "listening device" in the context of espionage. It's really a very simple idea, simply expressed. --LDC
Simple ideas can be wrong. Usually, what establishes their credibility is cases... explanations or rationale that explains "why things are as they are" in terms of the theory. If it's really an "ism", it ought to be able to generate a rationale for economic cases. Else, it's just commentary on economic *subjectivity*...
I don't generally trust any "term of art", and constantly ask why professionals in one field think it is relevant to decisions made by people who know nothing about the field...
This does not endear me to specialists, pedants, Chairs of departments, nor, as you might have guessed... encyclopedia editors! ;-)
Definitions cannot be "right" or "wrong"--they're just definitions. They are tools to be used in constructing arguments, which can be "right" or "wrong". Now I do agree that perhaps terms serving such a purpose can be poorly chosen, confusing, or have unexpected connotations that compete with their definitions in a listener's mind, and might be thought of as "wrong" in that sense. But I simply don't see that here: "subjectivism" is a perfectly good simple word for the idea that individual people experience things differently, and "economic subjectivism" uses that term well, to describe the idea that different people can value things differently. I really don't see any interesting controversy here at all. --LDC
Not interesting enough to take any further here... but it speaks to a general policy that theory should be illustrated by cases to prove that it isn't just talk. As you describe it colloquially, it's "subjectivity", and wouldn't become "subjectivism" unless someone could show that there was deliberate and wilful ignorance of objective/empirical or relational/cognitive factors... but now *I'M* being a pedant... ;-)
Definitions can indeed be "right" or "wrong", that's the whole debate about "grounding" and what is "embodied" or "natural", versus just defined into existence tautologically... a debate as far back as the ontological proof of God of Anselm, at least...
But all that is definitely a *meta*... feel free to write something about that, maybe we can collaborate on it...
Some of Falsifiability is my text (most is Larry's, and I defer to him because he's the one with the Ph.D. in philosophy), and speaks to that issue. The "ism" suffix merely implies that it represents a body of belief--as it does. Also, see my own commentary Semantic Disputes (which is, thankfully, on my own site as it doesn't belong here). --LDC
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Something like Semantic Disputes could be discussed in meta, along with Proper names vs. generic names and their conventions in different languages.
This is only half-serious, but regarding the last paragraph, there is an old saying in Spanish: "only the dunce confuses value and price" (Sólo el necio confunde valor y precio). -- Miguel
An obvious example of economic subjectivism is value of life - each human being's own life is valued quite highly by themselves, and much less so by others. One could argue that peace and submission to an economic system is only achieved by valuing one's own life less and others higher, there may be some good writing on this somewhere by now.
This article also badly needs links to behavioral finance which is the most rigorous expression of this theory of subjectivism... and perhaps some links to risk and a discussion of regret is not out of line, since, regret also tends to be subjective and affect pricing rather significantly.
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