First off, I have a very limited understanding of economics, so sorry about that.
I've had this thought lately. As far as my (again, limited) understanding of "value" goes, a monetary value is created when I have a good that someone else is willing to buy. Whatever they're ready to pay becomes the value.
So. Let's say there was a hypothetical good that I wanted, but that didn't exist, a very particular table for instance. Had this table existed I would have been willing to pay a lot for it. Say $10,000. But since it doesn't I decide to make it myself.
Now this is a weird table, there's probably not anyone else who wants it, and definitely not for that price, but since I made it for me, and I'm not selling, would it matter? Have I just created $10k of value? It feels like it, since I now have both the table, and the $10k to spend on other goods that I otherwise wouldn't have.
When someone pays a producer to make a good, does it to an economist matter whether the consumer and the producer are the same or different people? And if there is a difference, why?
The only practical difference I can see is that had I paid another person to make the table, the money I paid them would be taxable income. But I would be surprised if value is tied to taxation.
Can I create monetary value all on my own?
byu/ZoofusCos inAskEconomics
Posted by ZoofusCos