2. Value in its original sense is a quality or desire of the mind: it means esteem or estimation: as we speak of a highly valued friend: but such Value is not an Economic phenomenon. To bring Value into Economics it must be manifested in some tangible form: just as in the same way, human abilities do not enter into Economics unless they are exercised in exchange for something else: nor does a merchant's Credit enter into Economics until he actually effects a purchase with it, and gives a Promise to pay in exchange for some merchandise. So Value does not enter into Economics until a person manifests his desire, estimation, or Value for something by giving something in Ex-change for it to acquire possession of it.

But as one person cannot gain possession of what another person possesses without giving him something in exchange for it, which that person desires, demands, or Values, it is evident that for an exchange to take place requires the concurrence of two minds. If a person brought a cargo of wine to a nation of teetotallers, no one would buy it: such a product would have no Value among such a community. So a cargo of tobacco would have no Value among a nation of non-smokers. The Value of a thing does not depend solely upon the person who offers it for sale, but upon the desire of the purchaser. However much a person may wish to sell any product of his own, yet if no one will buy it it has no Value. If an exchange takes place it can only be from the reciprocal desire of two persons, each for the goods of the other.

3. When, therefore, two persons agree to exchange their products, each product may be considered as the Measure of the desire of its possessor to obtain the product of the other person. The two products, therefore, reciprocally measure the desire of their possessors to obtain the product of the other: and when the respective persons have agreed upon the quantities of their products which are to be exchanged, the two products are said to be of equal Value. Each product is said to be the Value of the other: and this is the only kind of Value with which Eco-nomics is concerned.

Thus let A and B be any two Economic Quantities which are exchanged at any moment; then we may say -

A valet B

or

A is of the Value of B

or

A=B

Then B is the Value of A, in terms of B : and A is the Value of B, in terms of. A.

Thus, as the Physiocrates said - "Value consists in the relation of exchange which takes place between such and such a product: between such a Quantity of one product and such a Quantity of another."

4. Hence it is clear that Value is a Ratio, or an Equation. It is like distance: it necessarily requires two objects. The Value of a thing is always something external to itself. It is absolutely impossible to predicate that any Quantity has Value, without at the same time implying that it can be exchanged for something: and of course everything it can be exchanged for is its Value in that commodity. It is impossible to say that any Quantity has Value, without at the same time stating Value in what - whether bread, or shoes, or cloth, or money, or anything else. So it is impossible to say that a town has distance unless we state the place it is distant from. We can no more say that a Quantity is worth, than we can say that London is distant. And as any place is of different distances from other places, so any Quantity has as many Values as other Quantities it can be exchanged for.

Now suppose B as above is ten guineas: then A may be either of the other three species, of Economic Quantities. It may be a material product like a watch: or it may be an immaterial product, such as so much instruction in science or literature, or so much amusement - as so much acting, or any other service or labour : or it may be an incorporeal product - as a Debt, under the form of a Bank Note, or a Bill of Exchange: or so much Public Stock, or any other species of Incorporeal property. Each of these species of Property is of the Value of ten guineas: and therefore it manifestly follows that each of them must be equal to each other: for Things which are equal to the same thing are equal to one another.

But B may be either of the three species of Economic Quantities as well as A. Therefore any Economic Quantity may have Value in terms of any of the others.

The Value of the goods in the merchants' and traders' warehouses is the Money in the pockets of their customers. The Value of the money in the pockets of the public is the various products and services it can purchase. The Value of a Professor's lectures is the fees paid to him by his students. The Value of the Lawyer's, Physician's, Surgeon's talents is the income he can earn.

The Value of an Incorporeal Eight, or Promise, is the thing which may be demanded or promised.

The Value of a 5l. note is five sovereigns. The Value of a Postage Stamp is the carriage of a letter. The Value of a Promise, or Pledge, to cut a man's hair is the cutting of the hair. The Value of a Railway Ticket is the journey. The Value of an order to see the Zoological Gardens is being admitted to see them. The Value of an order to see the play is seeing the play.

Suppose the price of getting one's hair cut is a shilling: suppose I want my hair cut; what difference does it make to me whether I have a shilling in my pocket, or the pledge of the hairdresser to cut it? Is it not clear that in this case the Shilling and the Promise are of exactly the same Value to me?

Suppose I want a loaf of bread which costs a shilling: what difference does it make to me whether I have a shilling in my pocket, or a Promise of a baker to give me the bread? Are not the Shilling and the Promise of exactly the same Value to me in this case?

In short suppose that I want any product or service at all, what difference does it make to me whether I have the Money in my pocket to purchase it, or a Promise from some one to render me the product or service? Are not the Money and the Promise of exactly the same Value to me in each separate case?

Each separate tradesman only, of course, promises to render some particular product: and as this product is not demandable from any one but the person who has given the pledge, it has, of course, only particular Value.

Now what is Money? It is nothing but the generalised Eight, or Power, to demand whichever of these products or services we may require at any time. Is it not clear, therefore, that Money is a General Right, while each of these Pledges is a Particular Right?

Is it not clear, therefore, that each of these separate Rights is of the same nature as Money, only inferior in degree? And that they are Economic Quantities, or Wealth, for the very same reason that Money is? And that Money is nothing but a stored up or accumulated general Power or Right, of demanding all products and services? Is it not clear that, if a man had his pocket full of Promises or Pledges by solvent persons to render him all the products and services he wanted, he would be just as wealthy as if he had so much Money? Hence we see the perfect justice of the Roman Law - "Under the title of Wealth or Money, Rights are included."

These Rights, then, being clearly shewn to have Value, and to be Wealth, like any material products, they may be bought and sold and exchanged like any material products. A Right to demand a loaf of bread may be exchanged against a Right to have one's hair cut. And all these Rights are Economic Quantities, or Wealth, as much as any material products. They are the most colossal species of property in this country, and articles of the most gigantic commerce, whose mechanism is the subject matter of this work.

As the Value of anything is solely anything else it can be exchanged for, it is manifest that if it can be exchanged for nothing, it has no Value. No matter what qualities it may possess, if no one else wants it, and will give nothing for it, it has no more Value for its owner, than if he were in the centre of the Desert of Sahara. Many persons have almost a difficulty in believing that Money could have no Value: but Smith himself says that if a guinea could not be exchanged for anything it would be of no more Value than a bill upon a bankrupt. Say says that things can only be Valued by an exchange. This is strictly in accordance with the doctrine of all ancient writers and of the Physiocrates.

Thus a recent writer describing the splendour of the houses in some of the remote country districts of Spain says - "Houses and splendid furniture in such places are nearly Valueless, because there is no one to hire the former, or to buy the latter."

5. Having thus enforced the doctrine that the Value of any Economic Quantity is any other Economic Quantity for which it can be exchanged, there is only one further thing which need be noticed here: Price is the Value of a Quantity in Money or Credit only. Now if Money or Credit be excessively abundant, the Prices of all things will rise, but they will still preserve their relative Values among themselves. For if a loaf of bread and a pound of meat each cost sixpence; and if in consequence of the excessive abundance of Money or Credit, they each rise to a shilling, the pound of meat is still of the Value of a loaf of bread. Hence there may be a general rise or a general fall of Prices.

But there can be no such thing as a general rise or a general fall of Values. Everything can no more rise or fall with respect to everything else, than, as Mill says, a dozen runners can each outrun all the rest, or a hundred trees can all overtop one another; to suppose that all things could rise relatively to each other would be to realise Pat's idea of society, where every man is as good as his neighbour, and a great deal better too.