Time goes as 1/(1-V^2)^0.5 in this market. Everything is pretty good until you really want time to stop, then, blammo! The Energy goes to infinity and the Space pretty much looses a dimension. It's especially bad, because it the dimension you're walking along!
Trust me, fella, stick with dollars, at least you can print new ones.
What a racket!
Even the time on Earth you are allotted at birth is constrained by the environment you are born into.
We're born with a relative lack of entropy, which is the only thing that allows us to do anything. Eventually we inevitably return to equilibrium.
our application of energy (both physical and mental) transforms matter and collects/redirects ambient energy to productive use. that’s what generates value—gold in the ground is essentially worthless until we use labor to extract it. that it’s rare and has other interesting properties that make people trade more for it should be reflected in the labor value rather than some coercive capital value.
If I need to grind wheat for bread every day, I could spend hours a day working hard to grind it by hand, or I could spend a month or so to build a very basic water wheel/grindstone and free up all that time.
The resultant bread is still bread either way. If someone chooses to spend all their time doing the old/inefficient type of grinding, by the labor theory of value, they should be able to demand more money for the result. But why pay more money for something that took more time to make than an equivalent product made with automation? We value bread for being tasty and filling, not by how much time went into making it that way.
Some level of labor is almost always required to get raw material into a valuable state, but the amount of labor does not determine the value. Labor just regulates supply; if something takes a lot of work to make, the supply will be lower than if it were easy to make, which affects value.
You can see this by comparing production relative to something that can’t be automated away but is still valued over time - like a violin player.
The machine forces people in the same business down to your level, but people in a less automated arena go up in value relative to your bread.
> can't be automated away
But here is where we discover another component of value that exists in arts: the connection to human mind. Given a piece of music you like that you don't know the provenance of, you'll probably value it different after learning it was composed by a human vs. generated by an algorithm on the spot. It's irrational, but that's how things are with people.
A similar case would be of story generation in games. I don't know about you, but for me, learning that a story or a quest line was procedurally generated essentially destroys my suspension of disbelief on the spot.
And with AI it's not even by chance, even mediocre results are produced only after processing the input of countless humans. It's infinitely less cool of a coincidence than something that is actually random, like sticks forming a sentence where the wind blew them, and a complete NOP when it comes to human self-expression.
once the capital investment has been made, the price of the bread will go down because less labor will be used to make it, as the marginal cost of the bread goes down. the labor in the capital investment will be amortized over time in the price. the capital investment itself should only capture the riskiness portion of the project, not the majority of the resultant productivity gains.
and in many cases, people do pay more for a product made using more labor--i pay more for my manually-roasted beans than i would for mass-roasted ones. the higher price reflects the added labor in the value chain.
that's what i mean by the labor theory of value being more prominent, not to the exclusion of other theories of value.
And I know prices go down due to less labor being needed, meaning more supply results from less investment, but my point is that it’s wrong to assume labor is the underlying source of value. Labor has no intrinsic value. It’s only valuable in relation to output.
For some people, the “image” of a product and the amount of time and care put into it is an important part of that output. So they value products that have high labor costs even when comparable but less labor intensive products exist.
But to take an extreme example, if I banged two rocks together from 9-5 every day for the rest of my life, I wouldn’t expect a paycheck because there isn’t any useful output there, despite the labor.
primarily a value judgment stated axiomatically, rather than proof.
you could also argue that labor is the only intrinsic value, with all other value being projected onto the output as fashion.
I'm not discounting the value of labor relative to output, and it's clearly related to how we assign value to that output, but I think the labor theory of value is too simplistic and places too much value on labor and not enough value on utility.
I would combine the last two and call them "mass" and that currency is just an abstraction for how much mass you "own".
> The most common trade is when a person can trade their time and their body’s energy.
With this example I would say they are trading time and sometimes mass. They are trading time by the duration they work for and in certain jobs taking time off the years of their life. They may also move somewhere for a job even though they don't like the place and they spend their time in an non-ideal location.
They mass comes into effect when they are using their own car and gas to get to work, if they have to pay for their own work clothes, etc.
More reasons to think your comment is more about making the reader feel the insight is deep: there are other important conserved quantities in physics like charge; shouldn't that play a foundational role in economics if your analysis was correct? Will you next say that business leadership is really about "taking charge"?
I also purposefully did not insult the commenter's character, but restricted my reply to the comment itself.
Indeed humans provide very little energy. I've always used this to understand the value of oil to our society. Value, not the current price! :)
A barrel of oil fed into a machine can replace the work of hundreds of laborers. In this perspective, oil is ridiculously cheap, alternatively viewed, it provides us with a lifestyle that is luxiurious and some feats that are otherwise impossible (transoceanic flight).
> The most common trade is when a person can trade their time and their body’s energy.
They are not "trading their body's energy". They a performing a task which requires innumerable inputs, among them energy, vitamins, oxygen, correct ambient temperatures, training, tools, etc. Energy has a preferred fundamental status in physics but it does not have such a status in this economic transaction. There is no reason to emphasize over any of the other inputs. You are bringing it up because of the aura attached to it in in physics.
I didn't get that out of the original comment, and wouldn't presume to apply intent. I think most learned professionals here understand what is meant when they hear or say (for example) "that task took a lot of energy" or "I spent a lot of energy doing xyz..." without having to spell it out in academic terms.
People can also secure space. We’re used to thinking in terms of real estate, which always prices in the value of a structure or natural resources or potential on top of the raw spatial resource. But the raw three dimensional space can be traded as well, just like time or energy, as it is finite for humans.
Money is just a tangible abstraction later on top of these fundamental parameters of the universe we trade. Providing lots of energy in a small space in a short period of time is incredibly valuable to humans, and so money reflects that. Using energy and time and space in a more efficient way to produce something in a factory is valuable, so money reflects that.
It’s not that money isn’t real currency, it’s just an abstraction layer for tradable natural commodities like time, and energy, and space.