Today's post is about the labor theory of value by Adam Smith. What it is how it relates to the modern/crypto economy. Just a heads up it's not a Marijuana article but im high and explaining economic models let's just appreciate that for what it is.
I originally posted this on my read.cash blog but I wanted to share it with hive. Here's the original link
https://read.cash/@Chubbie149/value-of-labor-and-potential-applications-1b11ba5b
Origin
The labor theory of value ( LTV) originally perposed by Adam Smith a classical economics. The theory is outlined as a value assessment of labor as a commodity like goods. Deemed socially necessary labor the services in question are a prerequisite for a functioning economy and society. Though this is central to Marxist theories of economics this concept predates Marxism by 100s of years. Clarifying because people tend to have a negative view of Marxism and socialism. On my previous posts I mentioned that I am in construction. I think I have a certain perspective on this type of economics. The the economic system of the U.S is not based on (LTV) it's a monetary system known as the gold standard. This isn't functional and it's a lie as well spoiler alert but the u.s doesn't poses enough gold to back its monetary system it uses.
backstory
Adam Smith was known as ''The Father of Economics'' born in the early 1700s he's famous for two books An Inquiry into the Nature and Causes of the Wealth of Nations and The Theory of Moral Sentiments. This probably sounds familiar to you because it is a commonly coverd in economics courses. Introduced in his magnum opus the wealth of nations absolute advantage defined as a simple comparison of labor productiveness. Though it is not obvious a nation's (GDP) gross domestic product is based on absolute advantage principle. Economic structures utilize several aspects of his work and are realistically dependend on their guidelines. If you're nickname is the father of economics your someone who deserves attention.
Modern applications
In the cryptocurrency system we utilize a system of proof of work that requiring some work from the service requester, usually means computer processing requisite. In simplest terms the gas fee for transfer of cryptocurrency on the block chain ledger. This is pretty similar to (LTV) in principle and concept.
Labor theory of value is something that can be applied to any economy that ever existed. Unfortunately most people likely have never heard of it before. When you understand that it simply determines the wealth of an individual or group based on the most common types required goods like food of water. In layman's terms the cost of the good is determined by how much labor is needed to purchase or trade said good. I don't have all the answers im only human however those in power don't have them either despite their claims.
history repeats itself
Functionally an economic system that doesn't recognize the value of requisite functions will collapse that is an inevitability. Understanding why an economy is going to fail and prevention of such a failure can happen but it doesn't seem likely.
For instance those whom may be following me in weed.cash probably recognize the positive impact legal cannabis has on the local economy. However thanks to outdated laws and beliefs it's often labeled as a danger or problem when it is infact a benine solution both medically and economically.
Society is currently tearing it self apart due to the regionalism mentality that had been a foundation of all countries. This isn't functional in the modern world regional economic systems deter a global economic structure. We have reached a level of technological progress that can effectively provide a global economy. Cryptocurrency is a rudimentary version of a global economic system and it's a much more stable economic system. Cryptocurrency has taken power from institutions that don't deserve it and given the power to the population as a whole. Providing a opportunity that history has never seen before typically after a certain point economy's and Kingdoms collapse. Cryptocurrency and it's decentralization has a potential to possibly save the populus that typically would suffer or parish when this happens.
Modern perspective
Most people who are on Hive probably have no reason to regard crypto as anything other than currency. Since an economy is not something we can consider an omnipotent entity. Truly the power is our own it's our faith that gives an economy power. Without faith it's nothing more than data, plastic cards, and paper money.
Approaching economics without this mindset is how we got here nearly ending the world in the process. Clearly we have no choice other than reform our perception and mindset trusting that our leaders can help or even understand how to help is dangerous. We all must make changes to our established norm because of the harm it has caused. I don't want us to be what destroyed the planet with our ignorance and we can make changes. Difficult as it may be there is no possibility of our current economic system`s to make the changes needed. We must change things ourselves on a personal level and eventually a public one.
inspired by
I'm writing this simply because I like many others have concerns regarding the future. Clearly the current way of thinking is not working due to a inherent lack of understanding of economics and the warning signs aren't subtle. If we continue with this trajectory we will cause an apocalypse of our own making. We are currently experiencing a mass extinction that we caused. Clearly humanity and it's current social practices are a k class end of the world scenario. More than likely we have passed the point of no return. I don't have many people who actually read my posts. Im eternally thankful to Hive for giving me a platform to share my views. I don't expect to have any impact on anyone by writing this. Humanity must study the past in-order to effectively learn from the mistakes and contributions made by our ancestors. This is why I decided to write about a Scottish economist from the 1700s.
As I stated before this is a different topic than I usually cover but if you want to see more like it please upvote share and subscribe.