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Trevor Stone's Journal
Those who can, do. The rest hyperlink.
Pays For ≠ Values 
2nd-Oct-2009 05:01 pm
currency symbols
I posted the following to a Burning Man mailing list. The original context, mostly irrelevant, is whether volunteers for an event should get free admission.
But also there is the idea that our culture seems to really value some very valueless things while simultaneously undervalueing or seeing no value at all in some extremely valuable things - like motherhood, art, caregiving of all types, and so on. What I think we're doing with these discussions is working out what "value" means to our community and how we really can make our way to true giving - it's hard though and messy I think.

I think it's important to distinguish between "what our culture values" and "what pays well." Markets can take on a life of their own, so while you may be able to correlate values with money within a particular market (e.g., Americans have valued house size over quality of construction), comparing dollars paid in one market to dollars paid for something else doesn't really work.

For a silly example, I got paid a lot more to write software for governments than most sex workers get paid to give people orgasms. Does that mean our culture values effective property tax systems more than sex? No, it just means the market for people who know how to write code is tighter than the market for people who can have sex.

For a less silly example, I pay $5 in gas (plus car depreciation) to drive from Boulder to Denver and back. I pay nothing to ride around town on my bike. Does that mean I value driving more than bicycling and Denver more than Boulder? No, I enjoy riding a lot more and prefer to spend time in Boulder. It's just that the nature of cars involves spending money, but bikes not so much.

In my ideal world, the community makes sure everyone's well fed and cared for, even if there isn't a lucrative market for what they do. Like clean air, safe roads, and public broadcasting, art is a public good. You can't quantify how much value a person will get from artwork, so it's not well suited to markets with supply and demand. The fact that artists have trouble making a living doesn't mean we don't value art; it's just a reflection that our economic system isn't a perfect tool for ensuring our values are actualized.

Remember: economists use "willingness to pay" as a substitute for personal values, but that's just because it's a lot easier to do math with the former. Money is a useful tool for pursuing our values, but it does not straightforwardly represent our values. Don't confuse a pencil for a poem.

2nd-Oct-2009 11:21 pm (UTC)
I know I haven't commented on these, but your posts of late are both inspiring and maddening.
3rd-Oct-2009 12:20 am (UTC)
You make me smile, a lot.
3rd-Oct-2009 03:49 pm (UTC)
An important question to ask when defining "value," particularly in terms of monetization, is "compared to what?" And then to not compare apples and vectors, as my freshman physics professor once said.

For instance, in your car versus bike example, I think it is reasonable to say that for distances of ~20 miles, you do value being able to drive over cycling.

But I agree that there's a lot that economics doesn't measure. As a grad student I get paid way, way less money than I could make (2-3x if I wanted to be an engineer, probably more if I wanted to be a quant), but I also get paid in education, experience, and fun, which very much makes up for the money.
3rd-Oct-2009 05:32 pm (UTC) - Yes, but sometimes...
We use "willingness to pay" to provide some sort--any sort-- of economic value to non-economic things so that we can get the math right to make decisions in government. For example, if we just say it is nice to save the speckled dace, then we balance nice to save with $XX amount of money if we don't save. So if we use willingness to pay, then at least we get something.
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