Theory of value (economics)

"Theory of value" is a generic term which encompasses all the theories within economics that explain the exchange value or price of goods and services. Key question 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) theoriessee main article: Intrinsic theory of valueIntrinsic theories, as the name implies, hold that the price of goods and services is not a function of subjective judgements. An example is the labor theory of value which says that prices in a market economy are a function of how much labor was put into the production of a product.
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