The Past of Diverse Value: Value Theory, GDP Critique, and Goods/Services Whose Value Increases Over Time

The Past of Diverse Value: Value Theory, GDP Critique, and Goods/Services Whose Value Increases Over Time GDP is a rough measure of flow. However, our happiness strongly depends on stock (durable goods, infrastructure, cultural assets) whose value increases, is maintained, or depreciates over time, and on relational capital (trust, institutions, traditions) that is hard to capture on a price list. Price is merely "an agreement on a transaction now." Some satisfaction disappears immediately after purchase, while other satisfaction accumulates attachment or network value the more it is used. This paper organizes (1) the gap between price and value, (2) the time-profile of goods/services, and (3) policy and accounting implications (investment in long-life assets and relational capital), to show that even with the same GDP, happiness can vary greatly depending on the content. Accounting handles this difference coarsely through depreciation (useful life, maintenance costs), but from the perspective of happiness, it should be seen as a time distribution of utility. Therefore, indicators must have three aspects: flow (GDP) + stock (tangible/intangible) + relational capital. Happiness Theory or Value Theory? It is good for humans to be happy. Traditionally, economic indicators like GDP (or GNP in the past, and more recently GNI) are used to measure happiness. This might be because, among the social sciences, economics was the most advanced in quantification. Measuring happiness economically—that is, by monetary value, or the value of goods and services—is easy to understand. In fact, even economics textbooks discuss what should be used to measure happiness and welfare, and in the end, GDP is often used as a guideline with a sentiment similar to Churchill's: "it's the worst, but it's all we have." I am not familiar with recent economics textbooks, however. In this text, I will briefly discuss happiness theory, value theory, GDP, and its critique and reconstruction. Weaknesses of GDP GDP is a good indicator for considering the economy at a given time—employment, unemployment rates, prices, consumption, wages, and so on. Although I say "at a given time," it's not a real-time snapshot, as there are certain periods and reporting lags. I will look at the problems of using GDP as an indicator of value or happiness from two perspectives. Price is Different from Human Subjective and Objective Value In a monetary economy, a market-supremacist exchange economy, or a free economy, people often acquire goods and services by purchasing them with money. Therefore, there are prices. However, phenomena such as "not worth it," "a great buy, worth more than the price," or "good cost-performance" can occur. If we assume that buying goods and services with money makes us happy or increases our happiness, various discrepancies can arise. For example, even if you buy goods and services with money, you might consume them immediately, and the feeling of happiness might vanish just as quickly. Conversely, the happiness derived from purchased goods and services might not fade, might continue, or might even increase. This can be a personal experience where happiness increases as one grows more attached to the purchased item. It can also be objective, or social, where the market value of the purchased goods or services rises, and their value increases in the form of price just by holding them. These are things that GDP may not include or express. There are also cases where you feel you made a good purchase right at the moment of buying. On the other hand, there are times when you regret a purchase, feel it was a mistake, or were forced to buy it—cases where you did not make a "good purchase." This might not bring joy to the buyer, the seller, or the world. It's the opposite of the Omi merchants' "three-way satisfaction" (sanpo-yoshi); it might be like Ooka Echizen's "three-way one-ryo loss" (sanpo-ichiryo-zon) (though the meaning of "three-way loss" might be slightly different here). GDP cannot measure these things either. This is a problem from the GDP side concerning shopping, prices, and the increase of happiness. What is Value? Let's change eras for a moment and take a brief look at pre-war and post-war Japan. There is an opinion from the Taisho generation (born 1912-1926) that pre-war Japanese society was one with a rich diversity of values. This comes from Yuji Aida, a critic born in the early Taisho era, famous for his book "Aaron's Reinternment Camp." If I were to connect this to modern philosophy, it might be a diversity of differences. Even if someone was poor or had few assets, they might have lived in that land for a long time or been the head of the neighborhood association. They might have been skilled in a traditional art, been a martial arts master, or been known for their poetry or haiku. Even if others didn't, their family, relatives, and children might have respected them. Simply being good at using the abacus or mental arithmetic, or having a special skill, could earn respect and recognition from others. Having lived in that land for a long time, having a good lineage, or having respectable ancestors could also be a source of pride. Even if someone was deemed hopeless due to drinking, gambling, and womanizing, they might have been liked for their cheerful and bright personality, being a good talker who could make people laugh, or valued as a mood-maker. Even in a low-income job, one might work with pride for other reasons—because it has tradition, history, or is a family business. There are also those who act from the start having abandoned financial success, such as craftsmen with a "craftsman's spirit" who see making something as their mission, or those who dedicate their lives to research, scholarship, art, music, or other arts. Some people have assets but won't or can't sell them. They might hold them as family treasures in the form of art or crafts, or as ancestral property. Some may be forest landowners who have maintained the forests for generations and have no intention of selling them, quitting, or changing their "job." The examples are endless. It's endless if I try to list them, and people who know the past might remember such things, but after the war, values became simple, or rather, monotonous. In extreme cases, it's just about money. For some people, only money, status, honor, and reputation matter. I recall a clinical term in psychiatry like "sex, money, and fame," and there may be people who only possess such values and cannot understand or even imagine other values. In a sense, it seems that in the post-war period, Japan converted all its good aspects into money. It used to be said that Japan was rich in nature or that its nature was beautiful, but this stopped being said around 1990. Perhaps it is on a recovery trend now. It was also said that Japanese people were polite, but that reputation weakened around the time the bubble burst, and this too may be on a recovery trend now. Along with the Showa era, the pre-war generation—the old Japanese who knew the past well—passed away all at once. Emperor Showa, Osamu Tezuka, Ryotaro Shiba, and other representative or symbolic figures from various fields passed away one after another. The Cold War ended, the LDP fell from its ruling position, the bubble burst—perhaps it was a turning point of the era. Some kind of synchronicity or an alignment of causality that isn't well understood may have occurred. In any case, environmental destruction during the Showa era was severe. Not just in Japan, but all over the world. It went beyond "it couldn't be helped to escape poverty," and laws like the Resort Act were made, wrecking Japan's nature, which reminds us of the current solar panel problem. Deforestation in the Amazon and elsewhere was also rampant. The reason we don't hear about it in the news recently is probably that the necessary amount of deforestation has already been completed. At the time, the future impacts of global-level environmental destruction were being discussed, and it feels like those impacts are materializing now. This means it's not a problem that can be solved in a few years or a decade or two. Radical environmentalists pushed things forward radically, causing confusion in society and the environment, which had many downsides, but it might have been good for social enlightenment. The Afterlife of Products Changes Long-term and Overall Happiness and Society I recall Ryotaro Shiba once looking out over Paris or somewhere and commenting, "This whole city has finished depreciating." Mr. Aida, the Renaissance historian mentioned earlier, also left a comment in a dialogue about England: "They say it's a declining sun, but they have vast infrastructure built during their prosperity, so even if Japan has high economic growth or a bubble, the richness is different." Let's just look at GDP. If a produced item sells, added value—or value—is created. The more value produced, the richer. Richness might be different from happiness, but it is deeply related to it. When various goods and services are produced, what happens to them afterward is important. GDP only shows the flow, like in financial statements. Let's follow the afterlife of produced goods and services. Some are consumed and disappear. If it's a one-time thing, it's only for that time and place. A good memory might last for a long time, but the consumption is not reproducible. If it's something that can be used multiple times instead of disappearing after one use, perhaps the good feeling from consumption can be experienced repeatedly. So, for the same price and the same kind of item, something that can be used many times, rather than a one-time disposable item (though disposables have their merits), might increase the value and happiness of the world more. Some items, though slightly more expensive, have a long useful life and can be used for a long time if repaired and maintained. Houses, cars, and brand-name products are good examples. There's a theory that the rich buy expensive but good-quality brand products, maintain them well, and use them for a long time. There's also the saying, "penny-wise and pound-foolish" (buying cheap is a waste of money). The whole point of valuing brands, history, tradition, and goodwill (noren) is to advertise the high added value of providing good things that offer value beyond their price. The opposite case is a concern: purchasing and using something without any guarantee of history, track record, quality, or service life. Paradoxically, what will happen to the recent "various things that are good for the environment," and what they will ultimately bring, may become good data and samples for future generations as the results of a social experiment. Whether they were good for the environment and society, or actually bad for the environment or had negative impacts on society, is something that will be known later. It might even be calculable soon with supercomputers or the developing quantum computers. General-purpose generative AI, as an extension of current big data science, tends to lean towards average or most frequent opinions, so it's probably not very helpful. Common sense might have suggested that a moderate and trouble-free way was to proceed steadily with realistic energy-saving measures first, rather than pushing things radically. In economics and accounting, assets that lose value over time are called depreciable assets, divided into tangible fixed assets and intangible fixed assets. For the former, think of physical things; for the latter, think of trademark rights. Assets that do not lose value over time are called non-depreciable assets, such as land. The Ultimate Case: Goods and Services Whose Value Increases Over Time CPI (Consumer Price Index) is sometimes divided into Core CPI and Core-Core CPI. CPI is an indicator of prices. Sometimes, only the CPI excluding food and energy is considered. When the monthly CPI is announced, the CPI and the Core CPI (excluding food and energy) are announced simultaneously. Food and energy are typical examples of things that are consumed and disappear in one go. They are also daily necessities and, for "things," might be akin to management or maintenance costs. The economy is supposed to be viewed in terms of flow and stock, and accounting and financial statements are designed to show both. When you can read economic entities through their financial statements, you gain a kind of structuralist perspective on the world. The happiest scenario when purchasing goods or services is when the value of what you bought increases over time. This happens with investments, financial products, art, and important cultural properties. Putting aside economics, in other areas like history, tradition, friendship, human relationships, and trust, these things can sometimes decrease or disappear over time, but they can also increase or expand. If not just the economic value, but also the human or social subjective or objective value of the same thing increases, that can be considered an increase in happiness. Furthermore, some things inherently increase in value over time. The longer the history of a dynasty, the higher its value. Nature and cultural assets can also increase in value as time passes. Not everyone can become a king, a genius artist, or succeed in investing. Therefore, steadily building, maintaining, strengthening, and improving common things like trust, human relationships, and infrastructure is likely to increase the overall value and happiness of society. Infrastructure may deteriorate, and maintenance and repair costs may arise after depreciation ends, but setting that aside for a moment, we arrive at Ryotaro Shiba's "This city (Paris) has finished depreciating" and Yuji Aida's "Even if England is declining, it's still wealthy because the infrastructure from its colonial era remains." By the way, Yuji Aida was born and raised in Kyoto, so he also wrote that compared to Kyoto, which was not destroyed by air raids, Tokyo (whose infrastructure was destroyed) is immature and difficult to live in. GDP includes things that are consumed quickly, like food, which are necessary. But the point is that depending on the goods and services produced, even with the same GDP amount, there can be ways of producing and combining goods and services that sustainably demonstrate value and maintain happiness, or that increase in value and increase happiness. The Plurality of Value, the Plurality of Happiness, and Value/Happiness Beyond Money and Economy In the past, Japan was poor. People's incomes and assets may have been small, but even in poverty, there were many places where people could express their pride and value, and be recognized for it. Economic poverty may lower happiness, but having multiple ways to take pride in something or to have one's need for recognition and self-esteem fulfilled by being valued by others or society is an extremely fortunate thing. In any human group, people cannot get by without some ikigai (purpose in life). An ikigai enjoyed alone is fine, but it's bound to be more gratifying to have a role identity, to be recognized and praised for some aspect by others in human society. Even without money, even if poor, such things existed, providing a certain ease of living, a place to be, and a sense of belonging in old Japanese society. Time is Important, Compounding or Simple The increase of "value" (in the sense of values or worth) can, by analogy to money, be simple interest, compound interest, diminishing, or increasing. For example, the Ethiopian monarchy was abolished by the Italian invasion, making the Japanese Imperial House the oldest in the world. If the myths are correct, Emperor Jimmu was from 2,600 years ago, the same generation as Buddha. A royal house like this is a value in itself; it doesn't need money or flashy decorations. For an old business, 300 or 500 years of history is better than 100. The longevity of Sumitomo, like Japan's Fugger family, is noteworthy, as is Mitsui. There are long-standing companies and wealthy families overseas as well, which are now part of the social function, public institutions, and public figures in themselves. Value is human subjectivity—it can be trust, respect, awe, inspiration, emotion, or authority. There are many weighting factors other than time, but the diversity here is the key point. The more values there are, other than money and economy, the more chances there are for different people to hold different kinds. Conclusion: Happiness Theory I have tried to link value and happiness using the analogy of money, presenting diverse forms of value and happiness. For a time, money was strongly, almost identically, equated with value and happiness. We may recently be in a period of human reflection. By reflection, I don't mean that we did bad things, but rather that it is better to look back on both the good and the bad, and feed it back into the present and future. It's a strange thing to say, but until recently, many things were strongly ideological. Neoliberalism, globalism, SDGs, DEI, LGBT-something-or-other (I recently saw an article that included misunderstandings, including some paraphilias)—they were all ideologies. Well, MAGA, the CCP, the right-wing conservatives, the left-wing liberals—they all have ideological colors. But we must never forget realism, empiricism, facts, fact-checking, and realistic thinking and action. Otherwise, ideology, even if it is justice, can become a kind of "demon" as in Dostoevsky's novels and possess people. It is important to contextualize them with a spirit of modern philosophy and the "middle way" (in both the general and Buddhist senses). This is because if value and happiness involve the human spirit, including subjectivity and objectivity, it is better to guarantee the richness and diversity of that spirit.