"
Theory of value" is a generic term which encompasses all the theories within
economics that attempt to explain the
exchange value or
price of
goods and
services. Key questions in economic theory include why goods and services are priced as they are, how the value of goods and services comes about, and for normative value theories how to calculate the
correct price of goods and services (if such a value exists). Theories of value fall into two main categories:
Intrinsic (objective) theories- see main article: Intrinsic theory of value
- Intrinsic theories, as the name implies, hold that the price of goods and services is not a function of subjective judgements. This is the basis for the labour theory of value.