# Think Tank > Austrian Economics / Economic Theory >  Exchange Equivalence - Stupid Questions with Idiom

## idiom

Going to ask this here because Full Metal Alchemist has made it impossible to google.

The Austrian school rejects the idea that exchange is between two equivalent values right? In Austria land each person values the thing they are receiving more than the thing they are giving correct?

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## Swordsmyth

Yes, otherwise why trade?

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## Schifference

I would look for equal value when trading.

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## Swordsmyth

> I would look for equal value when trading.


But would the thing you trade away actually be as valuable TO YOU as the thing you trade for?

When I buy food from the store it is because I need food and I can't eat FRNs or coins and the store has more food than they have any use for and they want FRNs.

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## acptulsa

> The Austrian school rejects the idea that exchange is between two equivalent values right? In Austria land each person values the thing they are receiving more than the thing they are giving correct?


Not really.  Clearly both traders have an excess supply of the thing they're trading and not of the thing they're trading for.  But clearly they consider the value equivalent enough to do the trade.

The cobbler trades shoes for, well, everything else he owns.  Does that mean he values shoes less than all other things?  I suspect not.  He made his _career_ out of shoes.

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## Swordsmyth

> Not really.  Clearly both traders have an excess supply of the thing they're trading and not of the thing they're trading for.  But clearly they consider the value equivalent enough to do the trade.
> 
> The cobbler trades shoes for, well, everything else he owns.  Does that mean he values shoes less than all other things?  I suspect not.  He made his _career_ out of shoes.


He values THE SHOES HE SELLS less than the things he gets with the money he trades them for, he values THE SHOES HE USES more so he doesn't sell them.

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## oyarde

You trade for what you need . If I do not need anything I can store it  . If I have too  many apples I can make beer , If I have too much wheat I can make beer , if I have too much corn I can make whiskey . If I have all of the toothpaste and @Suzanimal is out of toothpaste she will trade me something for some . She will want to brush her teeth , Danke of course would not be bothered not brushing his teeth .

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## Swordsmyth

> You trade for what you need . If I do not need anything I can store it  . If I have too  many apples I can make beer , If I have too much wheat I can make beer , if I have too much corn I can make whiskey . If I have all of the toothpaste and @Suzanimal is out of toothpaste she will trade me something for some . She will want to brush her teeth , *Danke of course would not be bothered not brushing his teeth* .


He has false teeth?

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## Suzanimal

> He has false teeth?


Nah, he's just nasty.

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## Suzanimal

> You trade for what you need . If I do not need anything I can store it  . If I have too  many apples I can make beer , If I have too much wheat I can make beer , if I have too much corn I can make whiskey . If I have all of the toothpaste and @Suzanimal is out of toothpaste she will trade me something for some . She will want to brush her teeth , Danke of course would not be bothered not brushing his teeth .


Yeah, I'm stickler for clean teeth but I stand firmly in the anti-flossing camp. BTW, I picked up a bracelet at the thrift store that is egg yolk amber but I call it my British toof bracelet.

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## Fox McCloud

If you value something exactly equal to something else, you won't engage in the trade. Why? Transaction cost. Every transaction has a cost, in an of itself. Whether it be something as small as picking something up and handing it to someone else, or as expensive as driving halfway across the world.

There are situations where it _appears_ that people exchange goods of equal value ("I'll trade my $1 bill for your $1 bill"), but this is only fixating on cardinal value in addition to monetary value. When such a transaction occurs, it's very likely because there's a psychic profit made, somewhere. Maybe the person values the "feel" of trading, or maybe they value teaching the other person a lesson in exchange of goods. This is also why some _appear_ to sell at a loss, intentionally sometimes ("I will give you $2 for your $1").

Either case, if there is zero psychic profit, and it's only numerical, then no one will ever exchange $1 for $1.

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## Danke

> Nah, he's just nasty.


That is why you are in love with me.

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## Suzanimal

> That is why you are in love with me.



Exactly.

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## oyarde

> He has false teeth?


Nah he is just nasty .

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## acptulsa

> Nah he is just nasty .


Is that why you're in love with him too?

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## oyarde

> Is that why you're in love with him too?


Danke has been chosen by me to expand our peaceful  trade relations with the northern whites , it is thought he has great influence there ( once owner of the Ron Paul autographed box truck ) and also represents the somalians , bikers and the other disenfranchised  who were not taken in by the minnesota farmer - labor Party . There is Great economic potential at stake here and we have lifted minnesota tariffs .

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## acptulsa

> There is Great economic potential at stake here and we have lifted minnesota tariffs .


That's good to hear.  Overpriced Spam is a terrible hardship.

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## idiom

You have all been exceedingly helpful.

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## Suzanimal

> Going to ask this here because Full Metal Alchemist has made it impossible to google.
> 
> The Austrian school rejects the idea that exchange is between two equivalent values right? In Austria land each person values the thing they are receiving more than the thing they are giving correct?


Yes. Subjective value.

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## oyarde

> You have all been exceedingly helpful.


You are most welcome

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