Value

NOTE: This page needs some work to harmonize the new definition of value with the old one.

Value is not a thing, it is an experience. As such, value cannot be stored or transferred, contrary to the conventional wisdom, which is rooted in value fetishism. Money is not value.

Sensorica's working definitions

Value is a subjective experience that moves human beings into action. -proposed by Tibi

Note that this definition can be extended to other living systems, it is not only reserved to humans.

A valuable is something that triggers a value experience, something to which humans attribute value.

Valuation of something is an imaginary process by which an individual projects him/herself into the future trying to imagine how moved he or she would be by that same thing. The result of this process is circumstantial and characteristic to that specific individual.

Other opinions on value

Re-imagining value

Re-imagining Value: Insights from the Care Economy, Commons, Cyberspace and Nature A report of DeepDive, Berlin, September 2016, convened by the Commons Strategies Group in cooperation with the Heinrich Boell Foundation and David Graeber.

p2p value

From p2pValue project, deliverable D1.2

The proliferation of communities of collaboration is creating significant problems for traditional conceptions of productivity and value. Indeed, the application of conventional value metrics is increasingly problematic not only in CBPP, but more generally in information and knowledge economics. New definitions of value are necessary in order to evaluate the contribution of the wide diversity of productive activities. However, the question of value in collaborative communities is not only an economic one, but also a question of justice. The problem of how to regulate and reward activities that are presently without a market value (e.g. the externalities produced by Free Software for the software industry) is contingent on the ability to find a rational and transparent measure of value.

On value sovereignty

From Michel Bauwens, during the DeepDive:re-imagining value, Berlin 2016:

“We cannot do without a value regime,” said Michel Bauwens, founder of the Peer to Peer Foundation and cofounder of the Commons Strategies Group. “Today, we have a dictatorship of one kind of value as delivered by the market system, which determines for everyone how they can live.” Consider how the labor of a nurse is regarded under different value regimes, he said: A nurse working as a paid employee is considered value-creating – a contributor to Gross Domestic Product. But the same nurse doing the same duties as a government employee is seen as “an expense, not a value-creator,” said Bauwens. The same nurse working as a volunteer “produces no value at all” by the logic of the market system. Bauwens said that his work in fostering peer production communities is an exploratory project in creating a new type of “value sovereignty” based on mutualism and caring. An important aspect of this work is protecting the respective community’s value sovereignty through defensive accommodations with the market system. “The peer production system lives a dichotomy,” explained Bauwens. “It is based on contributions for which we don’t get paid. We therefore have to interact with the market so that we can earn a living and get paid for what we have to do.” Maintaining a peer community within a hostile capitalist order requires that the community “create membranes to capture value from the dominant system, but then to filter it and use it in different ways” – i.e., through collective decisionmaking and social solidarity, not through the market logic of money-based, individual exchange.

Open report of DeepDive, Berlin, September 2016

Related to contributions

A benefits distribution algorithm uses contributions to compute redistribution of benefits. During the early days of Sensorica Valuation was seen as a process that attributes a quantity to a contribution and helps to compare different contributions, to rank contributors, based o that to distribute benefits to contributors in a way that is perceived as fair by a critical mass of peers.

In these early days of Sensorica, Kurt asked the question: can an evaluation process be built on a value topology, i.e. using multiple orthogonal dimensions for evaluation, a value space? What would constitute good dimension of valuation?

1. They are meaningful
2. Their meaning is conveyed to non initiates reasonably accurately
3. They are composable
4. They are orthogonal
5. Their meanings do not overlap at a given level of composition
6. They are quantifiable: may be directly measurable (in a mediated environment), or resolve to a measure based on human evaluation processes
7. Ideally they require no effort to track beyond doing the thing that is being measured

Some candidate dimensions to consider can be found here: Value Mind Map proposed by Kurt. See more on http://mathworld.wolfram.com/Dimension.html.

A few years later, the p2p Value project proposed six diverse dimensions of valuation - remixed from p2pValue project:

1. community building,
2. objective accomplishment,
3. monetary,
4. social use,
5. reputation,
6. ecological.

One can also talk about an ethical dimension of the valuation process. For example, as members of open source communities consider themselves as part of the open source movement, they are aligned with the ethics of free sharing of knowledge.

Another way to look at the valuation process is: from an individual perspective, community perspective, or societal perspective. Individual values can refer to more fundamental principles or beliefs, which are related to moral or ethical values. (...) ideological values such as privacy, freedom of expression, and individual agency or autonomy. The kind of community valuables perceived by individuals that are considered as most important is knowledge sharing. Others are: learning; coherence with own ideology; and community building.

The production of valuables (resources or others) rests on causes and conditions, which first create the potential of valuables ] being produced - the contextual probability to trigger a value experience, to move people into action towards some goal or outcome. An tool like the NRP-CAS must be designed to attract these causes and conditions.

Much of value remains tacit, then it becomes perceived, usually when the value experience is generated in context (application) by something tangible, from which we tend to project some future benefits (rightly or wrongly).

Example: If an affiliate reads a book he/she enriches him/her-self but nothing is added to the OVN that can persist independently of this affiliate. If the knowledge acquired from this exercise is applied to some activity within the OVN it becomes valuable if tangibly available (*attention, *concurrence from someone with that knowledge in a context where it is relevant and needed). Attention (engagement) is not valuable in and of itself, before anything is done.

There are two ways to perceive potential of valuables being produced,

1. by them being identified as necessary to a project or venture (we need X for the project),
2. by them being surfaced through conversion to more tangible forms of valuables (X can do Y in the project).

There are a number of valuation dimensions that speak more directly to the potential of a valuable being created. Knowledge is something we need to entice.

1. *Surfacing relates to the realization of bringing knowledge into context.
2. *Influence is something we need to entice.
3. *Relationship is the realization of influence and
4. *Introduction is its vector.

How to evaluate/quantify/measure *influence. See Klout

Types of valuables

We can speak about

• Market / Exchange valuable (a product, something that can be exchanged/traded)
• Use / commons / regenerative valuable (infrastructure development, creating tools for the group, etc.)
• Social valuable (something that benefits a larger group of individuals)
• Ecological valuable (something that benefits or at least preserves the environment)
• Care valuable

Processes and valuables

Valuables can be material or immaterial, tangible or intangible. They can be created, transformed, exchanged, shared, consumed and destroyed. Individuals invest different types of assets (also valuables) during these processes. We call material valuables resources.

Properties of valuables

Valuables in use are not always equivalent to valuables in trade, are not always equivalent to cost of production. Jean Francois Noubel puts it nicely by saying there are moveable valuables, measurable valuables, tradeable valuables, acknowledgeable valuables, and possible valuables.

Behind all human endeavours are value systems. Humans are moved by the valuables that they perceive AND by their understanding of how to get to them. They forge relations among themselves and coordinate their actions in ways to increase the probability of getting to the valuables that they perceive, to increase their well-being in doing so, as well as for other reasons.

Art Brock uses tradeable, measurable, rankable, nameable, possible wealth.

Value Mindmap - by Kurt: http://www.mindmeister.com/86243784/value

Value as an organizing principle

Value synchronization is the coordination of value experiences among humans. This coordination generates dynamically stable patterns of social systems. The same way complex physical systems exhibit self-organization when energy/matter is exchanged with the environment, open value networks self-organize when valuables are expressed and acknowledged (accounted and reciprocated) internally and in relation to the external environment. Understanding valuation processes leads to successful designs of value systems with well-behaving attractors, which manifest themselves by high creativity, productivity AND a good feeling (positive reinforcement) about being part of such systems.

Value system models may combine three main approaches to design OVNs - living system/ecosystem view, - the game-theory - individual view - behavioral economics - crowd view - the ethical/philosophical collective view

Discussions

About the nature of value

We tend to believe that things have a priori value because we can reference almost anything to the market and associate a price to it. For example, we take 1 hour of work doing R&D in electronics and equate it with 50$ (market price on the labor market). We take 1L of soap consumed in the same R&D process and assign value to it in the same way, by looking at its market price in $. Almost everything we use and do can have a price associated with it, which comes from the current market, and that gives us the impression that things have intrinsic value. That market price is actually given by a market-based process (very complex and emergent), which fixes a relative measure of things, in a given context, which is after generalized to other contexts causing all sorts of problems. Something can have a 10$ market price and zero importance for me, I would never take it even if it was free. In other words, a thing doesn't have an intrinsic value, or is not valuable in and of itself, in a universal way. We refer to the market to assign value to things, but that's just a reference to a particular system for valuation, one way to assign relative importance to things among others, which doesn't satisfy everyone out there in all contexts.

Transactions (payment) in a market must operate on a fix price, which is seen as a proxy of value of the thing that is exchanged (we need to agree on an equivalence during an exchange, how much of this for that). The transaction covers intermediate steps in the production chain (or the so called value chain), the last being the step of sales for consumption. Pricing determines how much each step is 'worth' ($50 per hour for labour, $20 for a widget).

In an OVN, it is the consumption or the use of something in a process that determines if that thing is valuable. The thing can be transferred to the process by some type of exchange process (purchase, lending, barter) or as a contribution. If the thing is transferred as a contribution, then it goes into a record keeping (usually the NRP-CAS). The benefits distribution algorithm determines how all the contributions will be transferred into distribution of benefits, and takes into consideration the steps in the production chain. In this case, it is the NRP-CAS which determines the 'worth' of a thing that is used in a production process. this worth can be represented in pricing or in any abstract currency.

In current times of economic transition, there is a hybridization between the OVN model and the market system. On the consumption side, this means that an eventual sale or pricing in the market (actualization of value at the edge of the network) will occur, mediated by a currency, and this currency income will be distributed according to a benefits distribution algorithm to participants. On the production side, this means that procurement might include something that is purchased (procurement through the market, as opposed to a contribution made by an affiliate), using a currency. The amount of currency used for this market-based procurement must be recorded as a contribution, therefore there is a need to compare this amount of currency with all other contributions in the context of this project. Moreover, this comparison can be dependent on the step in the production chain where this event occurs, at the time it occurs.

Consumption needn't be priced in currency. It could be evaluated in resources consumed (either by reference to the final form -the chair, or by reference to the inputs -skilled carpenter time, forester, mill, transport, energy consumption etc.). While a monetary system is perhaps 'simpler' on the face of it, it is in fact an illusion because the monetary system is quite complex and introduces manipulations in the valuation process and allows unfair benefits to those who run the currency (if this currency is centralized).

We can also look at the difference in terms of how risk is taken and ultimately how reward is distributed.

When someone pays for an intermediate result or 'input', they take on the risk that the use of that resource will allow them to produce a return. The party selling the resource has traded the risk of developing that resource further for the certainty of a price in the currency of choice. It is the difference in opinion on the future perceived value of that input and a difference of skill set to develop that input that cause the transaction to take place. The problem is that an information gradient can cause distortion in prices.

If I know I can sell consulting services at $140 an hour and you don't I can pay you $80 an hour and sell you for $140. In today's market that is called recruiting and it is a legitimate business.

If one takes the hybridized OVN approach to this scenario, there is no need for the intermediate transaction (the $80 per hour). It is the consumption of services that crystallizes the evaluation in the currency of choice. The benefits redistribution algorithm between the recruiter and the skilled labour is explicit and the $140 per hour will be divided between the parties. It may end up being the same split, but there is no hiding of information, and that makes all the difference.

In the pure OVN scenario there is no $140 per hour, only an accounting of what is done with the hour and its agreed upon evaluation method benefits redistribution algorithm. The folks that made that service are the skilled labour and the recruiter (and the recruiter's spouse who cooked them breakfast and the skilled labourer's mentors and instructors etc., to the boundaries of the benefits redistribution algorithm).

Pricing, it seems, permits a lack of information about the past inputs and future usefulness of a given intermediate result. This is quite a useful property, but it is a shortcut with consequences.

I hope we can minimize the subjective evaluation, or at least make it explicit in the benefits redistribution algorithm rather than unknown in people's heads.

See also

• value stream

External links

• Tibi's conception of value.
• Translating Commons-Based Peer Production Values into Metrics: Toward Commons-Based Cryptocurrencies; Primavera De Filippi