Exergy Theory of Value: Towards a Comprehensive Understanding of Economic Value Creation

Abstract

The groundwork paper discusses a new theory in the field of economics, the Exergy Theory of Value (XTV), which bridges the gap between the biophysical and socio-economic realms, to provide a comprehensive understanding of economic value creation. According to XTV, the true catalyst for value creation in the economy is not just energy consumption, but more specifically, the extraction of usable energy from the environment. The paper presents XTV as a unification of the three main theories of value, namely, the Labour Theory of Value, the Energy Theory of Value, and the Subjective Theory of Value. By shedding light on sustainable and efficient practices of economic value creation, XTV carries profound implications for understanding economic profits and promoting sustainable growth, efficient resource usage, and equitable wealth distribution. The theory suggests a path towards a thermodynamics-inspired discourse in economics.

Keywords: Exergy Theory of Value, Economic Value, Labour Theory of Value, Energy Theory of Value, Subjective Theory of Value, Sustainable Growth, Resource Efficiency, Biophysical Economics, Thermodynamics, Wealth Distribution

JEL Classification: D46, Q40, Q44, D63