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Adam Smith was confounded. One of the greatest economic and social thinkers in the history of ideas struggled with the so-called diamond-water paradox.
None of us would be able to live beyond a couple of weeks without water, yet its price is relatively cheap compared to the frivolous diamond.
Most people resolve this paradox by replying the supply of diamonds is scarce compared to water. But this theory lacks explanatory power.
Ron and Ed will compare and contrast The Labor Theory of Value with the subjective theory of value, developed by the Marginalist Revolution of 1871-1874.
The idea
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