Re: (OPE-L) total values = total prices? addition

From: Jurriaan Bendien (andromeda246@HETNET.NL)
Date: Mon May 17 2004 - 21:48:15 EDT

I wrote:

If economic value itself cannot be measured other than in terms of priced
costs, or else in terms of labor-hours performed, then trying to prove an
identity of total prices and total values is just pointless. We're not
interested in values as such, but in value-relations.

I could add of course that a third method of objectively measuring the value
of assets consists of estimating the exchange-ratio's applying to specific
goods traded, a method of importance in studying countertrade and structural
unequal exchange. But I was thinking here of "value as such" such as it
pertains to outputs. Various other methods of measuring economic value could
of course be devised, for example patterns of real consumption. Here's an
interesting quote I am using for my article "The transformation problem and
the Marxian law of value":

"But the question remains, what is the value of a company ? The answer
depends on who is asking the question. A business owner would be interested
in the market value of the company, whereas, the accountant cares little or
nothing about capitalizing knowledge and wants to know instead the book
value of the company. Accordingly, not all the factors determining the value
of the company are included in the book value. Stock exchange analysts for
example are particularly interested in the economic value of the company.
They look at a future cash flows, and convert them into present values
against weighted average costs of capital. An important point of criticism
about existing annual reporting is the lack of future-oriented information.
The rowboat represents the old way of thinking of a company's value and of
financial reporting. The metaphor of the rowboat says something about the
role of the accountant. In effect, an accountant is sitting in a rowboat; he
is going forward but looking backward; while the entrepreneur is sitting in
a canoe; he is going forward and looking forward. Or, in the words of Paul
Fentener van Vlissingen (1995): "The figures from an annual report say
something about the past but nothing about the future. It's as if you are
sitting on the back of a horse, backwards: what you can see is already
behind you. Where the horse is going is unknown, because you have your back
to it. Maybe it is heading for the edge of a ravine..."

- Stephen Goldman and Dimitri Hoogenboom, "De waardebepaling van kennis in
ondernemingen" (Longman, 1998), p. 93.
The reference is to P. Fentener van Vlissingen, "Business Owners are like
Donkeys". Leuven: Van Halewijk, 1995.


This archive was generated by hypermail 2.1.5 : Wed May 19 2004 - 00:00:01 EDT