Subjective Valuation Versus Arbitrary Valuation

Subjective Valuation Versus Arbitrary Valuation
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Frank Shostak
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Commentary

Many assume that an individual’s valuation scale, which is in his head, determines his choices. The decision to buy or not to buy a particular good is subjective valuation. Since the buying of goods is not linked to any particular goal, this buying is of a random nature. From this it may appear that subjective valuations are of an arbitrary nature. But is this the case?

Frank Shostak
Frank Shostak
Author
Frank Shostak, Ph.D., is an associated scholar of the Mises Institute. His consulting firm, Applied Austrian School Economics, provides in-depth assessments and reports of financial markets and global economies. He has taught at the University of Pretoria and the Graduate Business School at Witwatersrand University.