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An entropy theory of value

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  • Chen, Jing

Abstract

From the properties that the value of commodities should satisfy, it can be derived that the onlymathematical formula to represent value, as a function of scarcity, is the entropy function. From this function, the main factors that influence the value of a commodity are scarcity of the commodity, the number of producers, and the market size. In particular, monopolies and near monopolies, which have small number of producers or service providers, have high valuations. Many of the important institutional structures, such as religions, governments, unions, patents and regulations, obtain high valuation through monopoly.

Suggested Citation

  • Chen, Jing, 2018. "An entropy theory of value," Structural Change and Economic Dynamics, Elsevier, vol. 47(C), pages 73-81.
    • Handle: RePEc:eee:streco:v:47:y:2018:i:c:p:73-81
    DOI: 10.1016/j.strueco.2018.07.008
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    References listed on IDEAS

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    1. Chichilnisky,Graciela (ed.), 1999. "Markets, Information and Uncertainty," Cambridge Books, Cambridge University Press, number 9780521553551, January.
    2. Jing Chen, 2005. "The Physical Foundation of Economics:An Analytical Thermodynamic Theory," World Scientific Books, World Scientific Publishing Co. Pte. Ltd., number 5819, September.
    3. Jevons, William Stanley, 1871. "The Theory of Political Economy," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number jevons1871.
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    Cited by:

    1. Cameli, Simone Amato, 2023. "A complexity economics framework for 21st-century industrial policy," Structural Change and Economic Dynamics, Elsevier, vol. 64(C), pages 168-178.

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