Use value in the context of "Fiat currencies"

Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are: medium of exchange, a unit of account, a store of value and sometimes, a standard of deferred payment.

Money was historically an emergent market phenomenon that possessed intrinsic value as a commodity; nearly all contemporary money systems are based on unbacked fiat money without use value. Its value is consequently derived by social convention, having been declared by a government or regulatory entity to be legal tender; that is, it must be accepted as a form of payment within the boundaries of the country, for "all debts, public and private", in the case of the United States dollar.

Fiat money is a type of government-issued currency, authorized by government regulation to be legal tender. Typically, fiat currency is not backed by a precious metal, such as gold or silver, nor by any other tangible asset or commodity. Since the end of the Bretton Woods system in 1976 by the Jamaica Accords, all the major currencies in the world are fiat money.

Fiat money generally does not have intrinsic value and does not have use value. It has value only because the individuals who use it (as a unit of account or, in the case of currency, a medium of exchange) agree on its value. They trust that it will be accepted by merchants and other people as a means of payment for liabilities.

Capital: A Critique of Political Economy (German: Das Kapital. Kritik der politischen Ökonomie), also known as Das Kapital (German: [das kapiˈtaːl]), is a foundational theoretical text in Marxist philosophy, economics, and politics by Karl Marx. His magnum opus, the work is a critical analysis of political economy, meant to reveal the economic patterns underpinning the capitalist mode of production. Das Kapital is in three volumes, of which only the first was published in Marx's lifetime (1867); the others were completed from his notes and published by his collaborator Friedrich Engels in 1885 and 1894.

The central argument of Das Kapital is that the motivating force of capitalism is in the exploitation of labour, whose unpaid work is the ultimate source of surplus value and profit. Beginning with an analysis of the commodity, Marx argues that the capitalist mode of production is a historically specific system where social relations are mediated by commodity exchange. He posits a labour theory of value, contending that the economic value of a commodity is determined by the socially necessary labour time required for its production. Under this system, the worker's capacity to labour (their labour power) is sold as a commodity, but its use-value—the ability to create new value—is greater than its exchange-value (the wage), allowing the capitalist to extract surplus value. This process drives capital accumulation, which in turn fosters technological change, the creation of a reserve army of labour, and a long-term tendency of the rate of profit to fall, leading to economic crises and intensifying class conflict.

Calculation in kind or calculation in-natura is a way of valuating resources and a system of accounting that uses disaggregated physical magnitudes as opposed to a common unit of calculation. As the basis for a socialist economy, it was proposed to replace money and financial calculation. In an in-kind economy, products are produced for their use values (their utility) and accounted in physical terms. By contrast, in money-based economies, commodities are produced for their exchange value and accounted in monetary terms.

Calculation in kind would quantify the utility of an object directly without recourse to a general unit of calculation. This differs from other proposed methods of socialist calculation, such as Taylor-Lange accounting prices, and the use of labor time as a measure of cost.

In political economy and especially Marxian economics, exchange value (German: Tauschwert) refers to one of the four major attributes of a commodity, i.e., an item or service produced for, and sold on the market, the other three attributes being use value, economic value, and price. Thus, a commodity has the following:

• a value, represented by the socially necessary labour time to produce it (Note: the first link is to a non-Marxian definition of value);
• a use value (or utility);
• an exchange value, which is the proportion at which a commodity can be exchanged for other entities;
• a price (an actual selling price, or an imputed ideal price).

These four concepts have a very long history in human thought, from Aristotle to David Ricardo, and became more clearly distinguished as the development of commercial trade progressed but have largely disappeared as four distinct concepts in modern economics.

The labor theory of value (LTV) is an economic theory that argues that the economic value of a good or service is determined by the total amount of socially necessary labor required to produce it. The LTV is usually associated with Marxian economics, although it also appears in the theories of earlier classical economists such as Adam Smith and David Ricardo.

Smith saw the price of a commodity in terms of the labor that the purchaser must expend to buy it, which embodies the concept of labor commanded. Ricardo, building on Smith, developed a more consistent labor theory of value, arguing that the value of commodities is determined by the quantity of labor embodied in their production. Karl Marx's theory, which is the most elaborate and influential, holds that value is a social relation specific to commodity-producing societies. Marx distinguished between concrete useful labor, which creates use value, and abstract labor, the substance of exchange value. He argued that the magnitude of value is determined by the average labor-time required for production under normal conditions.