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Value and Money

October 29th, 2013
money

Tim Kreider is fed up with people asking him to do things for free:

Money is how our culture defines value, and being told that what you do is of no ($0.00) value to the society you live in is, frankly, demoralizing. Even sort of insulting.

This casual equating of money and value is common, but wrong. Consider water and air: you can't live without them, but water is cheap and air is free. On the other hand in many cases medical care is another thing you can't live without, yet it can be very expensive. We value all three of these things extremely highly, but their costs vary over a large range.

If money isn't value, what is it? Money is a way of making up for differences in preferences. An example: you would like your car washed. If for some reason the two of us were prohibited from interacting you'd probably wash it yourself while I would sit around reading random things on the internet. Relative to this baseline scenario you propose a change: I wash the car and you have time free to waste on the internet. This doesn't seem like an improvement to me, so I ask if you would additionally give me $25. We each prefer this to the baseline scenario, you because you really don't like washing cars and me because while I enjoy reading loud public misunderstandings I can always do that later, so we make the trade and are both better off.

(Applying this more generally, a couple could bid to see who would do a chore like washing clothes. The lower bidder would do it and get paid by the other. While very few people actually do things this way, it can work well.)

What I'm doing for you and what you're doing for me might both be really valuable. For example much of the core internet runs on peering. When you buy internet access the seller promises to connect you to every other internet user out there. If they're small they pay other companies that are more central for permission to connect to their networks. When two companies have similar sized networks with similar traffic levels, however, it's in both of their interests to connect to the other. They connect as peers, neither paying the other.

There are also cases where the relationship isn't symmetric but still no money is involved. For example, if I were to write a scientific paper I might submit it to a journal for publication. If they printed it they'd probably charge for copies, and neither they nor I would pay the other. While the benefits we're getting are clearly very different, we each gain enough from the transaction that we don't need money to compensate for differing preferences.

So what about the case where a website editor invites you to write for them, and doesn't offer payment? Kreider says he's writing:

... to make a plea to my younger colleagues. As an older, more accomplished, equally unsuccessful artist, I beseech you, don't give it away. As a matter of principle. Do it for your colleagues, your fellow artists, because if we all consistently say no they might, eventually, take the hint. It shouldn't be professionally or socially acceptable—it isn't right—for people to tell us, over and over, that our vocation is worthless.
People enjoy creation, barriers to entry and production are going down, and so we're seeing a lot of people willing to do things for free or cheap when there didn't used to be. Instead of interpreting "people won't pay me to do X" as "people think X is worthless," it's better to interpret it as "X offers enough reward to a lot of people that they're willing to do it for free." If X is sufficiently fun, satisfying, or enjoyable for you, then do it for free. If it's not, let other people do it. Either way, we're better off than we were before.

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