Be that as it may, when they refer the principle of Value to Labour, they would be very near the truth if they did not allude to manual labour. I have said, in fact, at the beginning of this chapter, that Value must have reference to Effort,—an expression which I prefer to the word Labour, as more general, and embracing the whole sphere of human activity. But I hasten to add that it can spring only from efforts exchanged—from reciprocal Services; because value is not a thing having independent existence, but a relation.
There are then, strictly speaking, two flaws in Adam Smith’s definition. The first is, that it does not take exchange into account, without which value can be neither produced nor conceived. The second is, that it makes use of too restricted a term—labour; unless we give to that term an unusual extension, and include in it the ideas not only of intensity and duration, but of skill, sagacity, and even of good or bad fortune.
The word service, which I substitute in my definition, removes these defects. It implies, necessarily, the idea of transmission, for no service can be rendered which is not received; and it implies [p159] also the idea of Effort, without taking for granted that the value is proportionate.
It is in this, above all, that the definition of the English Economists is vicious. To say that Value resides in Labour induces us to suppose that Value and Labour are proportional, and serve as reciprocal measures of each other. This is contrary to fact, and a definition which is contrary to fact must be defective.
It often happens that an exertion, considered insignificant in itself, passes with the world as of enormous value. (Take, for example, the diamond, the performance of the prima donna, a dash of a banker’s pen, a fortunate privateering adventure, a touch of Raphael’s pencil, a bull of plenary indulgence, the easy duty of an English queen, etc.) It still more frequently happens that laborious and overwhelming labour tends to what is absolutely valueless; and if it be so, how can we establish co-relation and proportion between Value and Labour?
My definition removes the difficulty. It is clear that in certain circumstances one can render a great service at the expense of a very small exertion, and that in others, after great exertion, we render no service at all. And this is another reason why, in this respect, it is correct to say that the Value is in the Service rendered, rather than in the Labour bestowed, seeing that it bears proportion to the one and not to the other.
I go further. I affirm that value is estimated as much by the labour saved to the recipient as by the labour performed by the cédant [the man who cedes or makes it over]. Let the reader recall the dialogue which we supposed to take place between the two parties who bargained for the diamond. In substance, it has reference to no accidental circumstances, but enters, tacitly, into the essence and foundation of all transactions. Keep in mind that we here take for granted that the two parties are at entire liberty to exercise their own will and judgment. Each of them, in making the exchange, is determined by various considerations, among which we must certainly rank, as of the greatest importance, the difficulty experienced by the recipient in procuring for himself, by a direct exertion, the satisfaction which is offered to him. Both parties have their eyes on that difficulty, the one with the view of being more yielding, the other with the view of being more exacting. The labour undergone by the cédant also exerts an influence on the bargain. It is one of the elements of it, but it is not the only one. It is not, then, exact to say that value is determined by labour. It is determined by a multitude of considerations, all comprised in the word service. [p160]
What may be affirmed with great truth is this; that, in consequence of competition, Value tends to become more proportioned to Effort—recompense to merit. It is one of the beautiful Harmonies of the social state. But, as regards Value, this equalizing pressure exercised by competition is quite external, and it is not allowable in strict logic to confound the influence which a phenomenon undergoes, from an external cause, with the phenomenon itself.[34]
Utility.—J. B. Say, if I am not mistaken, was the first who threw off the yoke of materiality. He made out value very expressly [p161] to be a moral quality,—an expression which perhaps goes too far, for value can scarcely be said to be either a physical or a moral quality—it is simply a relation.
But the great French Economist has himself said, that “It is not given to any one to reach the confines of science, and Philosophers mount on each other’s shoulders to explore a more and more extended horizon.” Perhaps the glory of M. Say (in what regards the special question with which we are now occupied, for his titles to glory in other respects are as numerous as they are imperishable) is to have bequeathed to his successors a view of the subject which is prolific and suggestive.