Extracts from an essay on ‘Value’, by Diane Coyle, part of our partnership with The School of Life.
Is money the only measure of value? Of course not. Everybody knows that there are some things money can’t buy, things like love, health, contentment, that we all value profoundly. So where then is the boundary between monetary value and the unmeasurable ‘true’ value? And what of the difference between value and values? When it comes to value we are in a territory of fuzzy boundaries and deep ambiguity.
The starting point for navigating this uncertain terrain is to ask where the boundary of the market lies, to ask what it is acceptable to buy and sell. Even so, the ethical limits on what can be exchanged for money shift over time and between places – think of slavery in the past, or selling blood for donation. Besides, the market process of exchange can bring about desirable outcomes whether money is involved (in the market for sulphur dioxide emissions) or not (in arranging the exchange or organ donations).
Since society’s collective ethical boundaries, essential guides when it comes to assessing value, are not universal or absolute, the natural question is what shapes them? To a large extent, we do value what we can measure, and what we measure is GDP, or in other words the sum of monetary economic activity. Unfortunately, it is a poor proxy for true value, both including harms such as pollution or resource depletion, and excluding huge benefits in the shape of the innovations that have transformed the quality of human life and health. Measuring monetary value is a starting point, but – just as the profit-driven, commercially minded Victorians were motivated by their belief in progress and the good life – true value is built on strong ethical values, and even vision.
To read the essay in full, please click here.