The Concept of Value

প্রশ্ন · Question

Assalamu Alaikum wa Rahmatullahi wa Barakatuh
May Allah bless you our honorable Sheikh, and help you and grant you
victory.
I have questions about the concept of value. The value is the quantity
of benefit present in a commodity, taking into account the element of
scarcity.
1. What tools do I depend on as an expert in a particular commodity to
determine the benefits of such a product?
2. Are the benefits determined by describing the benefits only or are
they valued in gold, silver or effort? If possible, give an example.
3 - Do these benefits in the commodity have a value and how it is
determined?
4 - How do I deal with – taking into account the factor of scarcity - in
determining the value and what is the relationship to it?
5. Is the value a study of the economic system or a study of economic
science?
6. What is the importance of discussing the issue of value and the
benefits of its study?
Finally, Allah bless you and may Allah reward you with good and
support you with a near victory. He is the Guardian and All Capable of
it. Ameen, Ameen.

উত্তর · Answer

Wa Alaikum Assalam wa Rahmatullahi wa Barakatuh,
1, 2 and 3 - as for the knowing the value and the tools that are relied
upon in determining this, they are the benefits to the individual as a
human in terms of satisfying his basic needs, as well as for the things

that have value in their own such as gold and silver. Values are usually
determined by comparison to another commodity and not by its price.
For example, the value of the loaf of bread is higher than the value of
an intoxicant substance even if the price of the intoxicant substance is
higher than it and so on.
This can be illustrated by the following: The real value of the
commodity is the amount of its benefit which is constant and does not
change because its benefit exists in the commodity itself. If we want to
estimate the value in a transaction, this is called the actual value,
i.e.,the value resorted to when suing. We estimate it with a commodity
known to the parties at the time of estimation, or with respectable
money at the time of estimation which has a value in itself such as gold
or silver, so we say it is equal to such kilograms of wheat, for example,
or equal to such grams of gold, or a silver dirham. That is to say, the
estimation of the value is with an item that has benefit in itself, so the
value is not estimated with what is not beneficial in itself such as paper
money. This estimation is based on comparing the benefit of the
commodity in question with the benefit of the items used to estimate
it at the time of evaluation. Whether the real value or the actual value
is under consideration, it is constant and does not change from the
time of evaluation later because it is a value.
4- As for how to deal with the issue of taking into account the element
of scarcity "contained in the definition" and what is its relationship to
the estimation of the value, we have already answered this issue and
here we repeat the text of the answer for you:
(The definition of the value as the quantity of benefit in a commodity,
taking into account the element of scarcity, yes, this is true. And not to
consider the element of scarcity a part of the estimation is true as well.
As for why it was mentioned, here is the explanation:
Bearing in mind the factor of scarcity is not part of the estimation, but
it is for the sake of keenness, care and preservation of the value. For

example, if you have a loaf of bread and you estimated its value in
terms of the benefit found in it; its ingredients, characteristics, uses,
and if it was rarely available, then you will be keen on it and may eat a
quarter of it in the morning and another in the evening, and so on the
second day, and if a crumb of it falls from you, you would rush to pick
it up. But if you have loaves like this loaf, even though the intrinsic
benefits are the same; its value is the same, you will not be attentive
for it an d will not take care of it like your care for the first loaf; you
may not even pick up a crumb if it falls and you may eat it and another
like of it in one day. Therefore, in the explanation, the book added to
"taking into account the element of scarcity" the words "at that time”.
It says at the end of page 33 (top of page 29 English edition): "because
the value of the commodity should be estimated by the amount of
benefit in it at the time of estimation, taking into account the element
of scarcity at that time.", that is, the time accompany the value when it
was evaluated. This means that the value is the benefit in the
commodity taking into account the factor of scarcity for a reason other
than the estimation of its value, but to preserve and take care of that
value because of the difficulty of obtaining the like of it if it is lost
because of its scarcity, and this observation is important for not to
waste the values but to use them with measure. Moreover, the
observation of the scarcity factor is useful i n comparing the stability of
values and the change in prices, rising and dropping, according to the
scarcity factor. Dated 21/04/2007).
5- Is the value a study of the economic system or a study of economic
science? This differ according to the context of the study. If the study is
in terms of the scientific subject concerning the value and price, i.e.,
the distinction between them, then this study is related to economic
science. So, we say: the value is the amount of the benefit in the
commodity itself whereas the price is the amount of money paid for
the commodity when purchased regardless of whether or not it is
beneficial, for this is merely a comparison in terms of definition.

But if the discussion is in terms of transactions, then it is the subject of
the economic system. For example: if a man borrowed a certain
commodity with the value of 100 Dinars gold and recorded in the
contract as such, then upon repayment, he may return the same
commodity or return a hundred Dinars gold if the commodity was
damaged. This is because the value remains constant; it does not
change with the change of time and place. But it is not permissible to
buy for him with the 100 Dinars a commodity of t he same type
because the price changes and it is not a condition to buy with the 100
Dinars an identical commodity. However, if a specific commodity was
recorded in the contract for a price of 100 Dinars, then upon
repayment, he may return the commodity to him, and if it is damaged,
he may give him 100 dinars or buy him a commodity of the same type
for 100 dinars whether it is identical or is of a better or less quality.
This is because price is not constant but changes according to place
and time. But both parties must understand the meaning of value and
price, otherwise, the matter would involve a government or a judiciary.
For information, the value cannot be estimated except in commodities
that have benefit or money that carries intrinsic value, but not in paper
money, for example. This is because the values are constant, whereas
the price can be estimated like the value as well as by paper money
since the prices change. So, it is permissible, when estimating by price,
to mention money as gold, silver, or paper money.
6. As for the importance of the study of value, it is derived from the
difference between the constant value of the benefits in the
commodity for the human being in terms of basic needs and for things
that have intrinsic value and the price that is not dependent on its
estimation in terms of abundance or scarceness on the benefits found
in the commodity. And perhaps if you review the topic of recording the
dowry in value or price mentioned in the book the Economic System
and the example mentioned above unde r No. (4), you may become

aware of the importance of the study of value, for it makes economic
research focuses on these two things:
- Making economic research focus on values, where the value relates
to the benefits that satisfy the basic needs of the human, and things
that have intrinsic value, it makes care on the beneficial items. In other
words, it makes the research on what benefit the people, so it
becomes the basic research and the research of prices is subsidiary to
it. So, it does not care about the harmful products even if they are
expensive because they are of no benefit .
- While making the research of the price the basis, and the research
of values subsidiary to these research leads to taking care of
expensive commodities and considering them of high value even if
they are harmful things, such as intoxicants and drugs, because they
have high prices and generate large income.
Thus, the focus of the economic viewpoint on values and then the
prices as subsidiary to these values; this view spreads the good and
tranquility among people, but the focus of the economic viewpoint on
prices and then the values as subsidiary to these prices; this view
makes commodities with high price to be high -value commodities
although they may be harmful to the society, and then this view
spreads evil and misery among people.
I hope this topic has become clear to you, Allah willing.
Your brother,
Abu Yasin
22nd Sha’ban 1438 AH
19/05/2017 CE