I know it's awfully arbitrary. I make terrible analogies but indulge me.

I ask you to dig a hole and pay you 10$. I then pay you 10$ (or better still you pay me) to fill the whole. Was 20$ dollars worth of value created?

Company makes MMO that is only fun if you grind to level 60. Guy pays third world country citizen to play the game for him until he reaches level 60. You claim that is a good thing because it gave a job to someone in the third world. I put it to you that is madness akin to digging and filling holes over and over. The company could sell you a level 60 character at no cost to them (changing a few bits on a server) and give the money to the third world citizen in aid (obviously not going to happen) and nothing would change except he could do something productive rather than slave away at a PC 12 hours a day (like we do).

That's where the definition of "value" gets blurry. If in your analogy you use the hole I dug for raising plants, does that mean you created 20 dollars worth of value? It's uncertain, neither "yes" or "no". Maybe the plants bring unwanted insects to the yard. Maybe the plant has to be removed just 2 months later because you need to build a new room. Maybe you forget to feed the plant and it dies two weeks later.

The concept of value is completely related to what you value and absolutely nothing else; if you value having a 60 level character you are willing to pay for that, if the game company does not offer that deal you are going to look another way to pay for it. Is like when someone give you apples in exchange for oranges, is not about creating value, is about exchanging. If you value more the oranges that's completely up to you. Therefore, charity (non-exchange) is a whole different subject.

Exactly. We know whether a virtual item is worth $20 by whether someone is willing to pay $20 for it.

I'd suggest that to make the hole-digging analogy work, we'd need to assume that there are people willing to pay $20 for the privilege of seeing a hole dug and then refilled (or something similar). And if that's the case, then who's to say the digging and refilling didn't create $20 of value?

Value isn't the right word here. "Global utility" would be better, but how do you define that? Take heavy drugs for instance. They can have a high positive value but most definitions of utility would assign them a low negative one, I figure.

http://en.wikipedia.org/wiki/Optimal_decision#Formal_mathema...

The relationships between actions are so complex that "global utility" is just as blurry, maybe the ones overdosing are mostly criminals; maybe the company that creates the chemical products for the distilling process of the heavy drugs is actually owned by some guy that is going to find the cure for cancer thanks to the funds earned from his chemical company. Or maybe experiencing reality is not better than your experience on drugs. Yeah, those are very controversial statements but is mostly because it falls under the field of psychology, sociology and philosophy, which arguably are even more blurry.

Well, the definition itself isn't blurry I'd say, since it's pretty much universal: the examples you cited should be encompassed as possibilities by the model. It's just hard to define because it involves the complexities and oddities of morality, happiness and the like -- our objective knowledge of those is so restricted and sparse that we're better off just "winging" judgements from our legacy of humanities study.

Although I know what you mean, Bulgaria is not a Third World Country. I think a better term would be Developing Country [0]. Third world means that it wasn't allied with either the USA/UK (First World) or Russia/China (Second World) during the Cold War [1]. Bulgaria was part of the Eastern Bloc [2].

[0] http://en.wikipedia.org/wiki/Developing_country

[1] http://en.wikipedia.org/wiki/Third_World

[2] http://en.wikipedia.org/wiki/Eastern_Bloc#Bulgaria