THE ISSUE OF VALUE IN ECONOMIC THOUGHT — PART 2: THE EVOLUTION OF VIEWS FROM 1871 UNTIL THE SECOND HALF OF THE 20TH CENTURY

Abstract

This paper is devoted to the evolution of views on value propounded in the period from 1871 until the second half of the 20th century. The creators of the scientific revolution in economics called the marginal revolution rejected the classical interpretation of value understood objectively, and developed a subjective theory of value. According to W.S. Jevons, economists should focus only on exchange value, which expresses the ratio of exchangeability of some goods for others. A. Marshall combined the issues of value and price with the theories of supply and demand. J.B. Clark made the value of goods dependent on their effective utility, which constitutes the significance that an individual attaches to satisfying a given need. For C. Menger value represents the importance that individuals attribute to particular goods, serving to satisfy those individuals’ needs. Expanding C. Menger’s views, E. von Böhm-Bawerk and F. von Wieser claimed that the value of goods is determined by their border use (marginal utility). L.M.E. Walras maintained that the exchange value of goods is determined by their rarity. In the 20th century, J.R. Hicks and K.E. Boulding, who based the theory of value on choice theory, and finally, P.A. Samuelson, according to whom the value of a commodity is determined by the point of market equilibrium, dealt with the modification of the neoclassical theory of value. Proposals by V. Pareto, G.K. Cassel and W.M. Zawadzki to remove the category of value from economics confront contemporary economists with the task of searching for, and possibly determining a new source and measure of value of goods and services.

Keywords

• history of the economic thought
• theory of value