Intrinsic theory of value

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This article is about the philosophy of economic value. For valuation of financial assets, see Intrinsic value (finance). For the concept of intrinsic value in numismatics, see Intrinsic value (numismatics).

An intrinsic theory of value (also called theory of objective value) is any theory of value in economics which holds that the value of an object, good or service, is intrinsic, meaning that it can be estimated using objective measures. Most such theories look to the process of producing an item, and the costs involved in that process, as a measure of the item's intrinsic value. Paradigmatically, money is supposed to be good, but not intrinsically good: it is supposed to be good because it leads to other good things, such as buying better teaching equipments at a local primary school.^[1] The explanation aims to differentiate the original meaning of intrinsic value from the actual physical benefit it has.

The labour theory of value is an early example of an intrinsic theory, which was originally proposed by Adam Smith and further developed by David Ricardo and Karl Marx and later disputed by Carl Menger who offered a subjective theory of value. Similarly, the physiocrats based their theory of value in the land.

This article uses material from the Wikipedia article  Metasyntactic variable, which is released under the  Creative Commons Attribution-ShareAlike 3.0 Unported License.