The Cycle of Value The Cycle of Value -- A Conservationist Approach to Economics

TL;DR

This paper introduces a conservationist framework for economics, modeling economic activity as a cycle of conserved value, and explores its implications for market dynamics, government roles, and traditional economic concepts.

Contribution

It presents a novel conservation-based representation of economic activity, defining value as a conserved quantity and analyzing economic cycles through this lens.

Findings

Value is conserved across transactions in economic cycles.

Traditional economic phenomena can be explained as outcomes of value conservation.

The role of government is integrated into the cycles of value.

Abstract

A representation of economic activity in the form of a law of conservation of value is presented based on the definition of value as potential to act in an environment. This allows the encapsulation of the term as a conserved quantity throughout transactions. Marginal value and speed of marginal value are defined as derivatives of value and marginal value, respectively. Traditional economic statements are represented here as cycles of value where value is conserved. Producer-consumer dyads, shortage and surplus, as well as the role of the value in representing the market and the economy are explored. The role of the government in the economy is also explained through the cycles of value the government is involved in. Traditional economic statements and assumptions produce existing hypotheses as outcomes of the law of conservation of value.