Aristotle on Value

Analysis

It is much more reasonable to assume that Aristotle simply thought of the exchange values of the market, as expressed in terms of money, rather than of some mysterious value substance measured by those exchange values. But does not this imply that he accepted the actual commodity prices as the standard of his commutative justice and thereby lost the means of pronouncing upon their justice or injustice? Not at all. We have seen that he condemned monopoly prices. It is not farfetched to equate, for Aristotle’s purpose, monopoly prices with prices that some individual or group of individuals have set to their own advantage. Prices that are given to the individual and with which he cannot tamper, that is to say, the competitive prices that emerge in free market under normal conditions, do not come within the ban. And there is nothing strange in the conjecture that Aristotle may have taken normal competitive prices as standards of commutative justice or, more precisely, that he was prepared to accept as ‘just’ any transaction between individuals that was carried out at such prices—which is in fact what the scholastic doctors were to do explicitly. If this interpretation be correct, his concept of the just value of a commodity is indeed ‘objective,’ but only in the sense that no individual can alter it by his own action. Moreover, his just values were social values—expressive, as he almost certainly thought, of the community’s evaluation of every commodity —but only in the sense that they were the super-individual result of the actions of a mass of reasonable men. In any case, they are nothing more metaphysical or absolute than quantities of commodities multiplied by their normal competitive prices. The reader will have no difficulty in perceiving that, if values are defined in this way, the Aristotelian requirement of commutative justice acquires a sound and perfectly simple meaning. It will be fulfilled by their equality in every act of exchange or sale: if A barters shoes for B’s loaves of bread, Aristotelian justice requires that the shoes equal the loaves when both are multiplied by their normal competitive prices; if A sells the shoes to B for money, the same rule will determine the amount of money he ought to get. Since, under the conditions envisaged, A would actually get this amount, we have before us an instructive instance of the relation which, with Aristotle himself and a host of followers, subsists between the logical and the normal ideal and between the ‘natural’ and the ‘just.’

References:

1. Schumpeter, Joseph A. History of Economic Analysis. New York: Oxford UP, 1954. Print. 61-62.

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2 responses to “Aristotle on Value

  1. Pingback: History of Economics Analysis | Irrepressible Thought

  2. Pingback: History of Economics Analysis | Gedanken zur Geschichte

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