But, while this seems true, as regards Subjective and Objective value _in general_, we shall find that there is a close and necessary connection between subjective value and that one branch of objective value just referred to, namely, Objective _Exchange_ Value. In what follows it will be shown that this latter Value, while, in itself, an objective, and, as it were, a mechanical power, is a superstructure on the subjective or personal estimates of value put upon goods by buyers and sellers within a market. In short, we shall have to vindicate, or at least defend, Jevons’ assertion, now become a text of the Austrian School, that “Value depends entirely on Utility.” From what has been said the reader will be prepared for the claim of this school, in opposition to Adam Smith and many of his successors, that, when the word Value is used without qualification, it should mean Subjective—or Personal—Value, and not Purchasing Power. The first and the main work of the theory of value, then, is to inquire into the nature, causes, and standard of Subjective Value. CHAPTER II THE ANALYSIS OF VALUE Political Economy is based on the analysis of economic conduct. As has been said, we are not at liberty to lay down new categories or even to give new names to economic phenomena. We have to take our categories and our vocabulary alike from the industrial and commercial world, and our most original work in this department is no more than the interpretation of a life which is, for the most part, unconscious of its own laws: a category of “the useful” or “the valuable” which practical people did not recognise as containing useful and valuable things and no other, would be quite unscientific. True, the economist has sometimes to show that the practical world is unfaithful to its own principles, but he can do so only after extended study of the economic organism has yielded these principles. The theory of value, therefore, must begin with a careful analysis of what the word means in the mouths of ordinary people. A man values food, clothing, shelter, and the like, because they minister to his physical life, and he values music and books because they minister to what he calls his “higher life.” As a nation, we value our service rifle because it can kill at so many hundred yards, and many forms of art and literature are highly valued because they minister to corrupt desires and moral decay. A collector values a piece of ugly china because it is old and rare, just as most women value their diamonds because everybody cannot wear diamonds. Taking these instances as fairly typical, and collating the common ideas out of them, we seem to learn three things about value. _First_, that, in probably the great majority of cases, the word has some direct or indirect reference to human life. On the whole, one would be inclined to say that the root idea of the valuable is that which _avails towards life_.