Americans Lose Faith That Hard Work Leads to Economic Gains, WSJ-NORC Poll Finds

Value is something that motivates people to do work (that creates value). It's like bartering (I'll fix your car if you mow my yard), but currency makes work fungible (I'll fix your car for $80, and then pay another guy $80 to mow the yard). Key to this is understanding that someone might be willing to cut the yard for $75, and someone else might do it for $60. Probably no one for $20 though.

Speculation, which you lean heavily on in your example, is essentially just gambling. (I'll get my driveway fixed up for $120, and -educated guess- it allows me to fix two cars for $80 each).

Value is found by everyone voting with their currency units on what the value of any given thing is.

99% of the time when you are confused about why something has low value, or why something has high value, you can dig into the market around it and find out why and it's almost always pretty logical (and if it's not, congrats, you can make money on fixing it). This is also fuzzy around the edges, it's never sharp lines. But the shape is consistent on the whole.

>Value is found by everyone voting with their currency units on what the value of any given thing is.

To me what you're describing sounds like market price discovery versus value, which can also be functional usefulness or social worth, in the vein of the diamond–water paradox. A price is what someone is willing to pay, but value is something's worth. For example while selling a car if nobody is currently interested nearby it's market value is $0, but it's functional value as transportation persists.

On the other hand I might pay much less for something than its value would be through price discovery. For example I might be willing to pay an extremely high price for a life saving medication, but rules or laws deliberately limit price discovery, because leaving it to the market would be considered unjust for similar reasons to laws regarding externalities via the tragedy of the commons.

>if we had a way of finely grading, say, teachers, then the teachers in the top 1% percentile could likely demand extremely high paying salaries...because 99% of teachers would fail to make this grade.

This is already somewhat done with teachers. Those who teach wealthy children such as at a prep or private school make more money than those who teach poor children. The salary does not directly scale with the quality of teaching - for example a 2x better teacher might make 10x the salary, because the bidding power of the wealthy parent is much greater.

Because currency is unevenly distributed, voting with dollars reflects the wealth and preferences of those with more money, skewing prices. In an extreme example if person A can pay $1,000 for a life-saving treatment and person B $10,000, does that make person B’s outcome ten times more valuable? In that sense, market prices aren’t neutral measures of value and are more like an economic version of ‘might makes right'.

I think there is a conflation between different types/definitions of "value" that always runs things off the rails. Economic value is a distinct thing that arises from markets and price discovery. It doesn't really cover social or personal values, despite them constantly leaking into discussions.

Pretty much everyone agrees teachers are valuable, but their economic value is relatively low or their market is distorted. As hellishly capitalistic as it sounds, a teacher that could reliably produce all star workers would probably be paid handsomely as a student conveyor belt to Megacorp, by Megacorp.

Also medicine breaks discussions of markets/economics, the value of a shot that saves your is infinite.