Value, one of the fundamental conceptions of political economy, has been the subject of many controversies, and has been variously defined. Usefulness does not determine value in the economic sense. Air is eminently useful, but it is not valuable in that sense: hence 'value in use' is distinguished from 'value in exchange,' and the latter is treated as the only meaning relevant to economic science. Thus value depends on usefulness and difficulty of attainment. There can be no absolute standard of value; but to avoid too rapid and violent fluctuation values are usually measured by the precious metals (see MONEY). A general rise of values is impossible; if there is a general rise in prices this means that the value of money has fallen. Mill established three laws of value, varying as the objects dealt with were (1) absolutely limited in quantity, like pictures by a dead artist; (2) capable of being increased by proportionally greater labour, like agricultural produce from a limited area; (3) capable of being increased indefinitely without increased cost of production. Ricardo's too abstract doctrine that value depends simply on the quantity of labour expended implies disregard of interest, profits, risk, different rates of wages, and other elements of the question.
For Marx's doctrine of surplus value, see MARX, SOCIALISM. On the wide subject of value generally, see the works of Ricardo, Mill, Fawcett, Jevons, and other works cited at POLITICAL ECONOMY.