Previously in this series: Menger and Value-Free Universals
Utility is not Use Value
All goods have utility, because, by definition, goods have the ability to satisfy needs. But non-economic goods, do not have use value, because we are not dependent on our command of concrete quantities of them to satisfy our needs. Nobody values, in the economic sense, a cubic foot of air. An idle fellow in reverie might muse on his appreciation of air. But acting man does not assign economic importance to it.
Value is Subjective
A thing’s value, like its goods character, is completely dependent on man’s awareness of the thing’s ability to satisfy his needs. Value is not an inherent quality of a thing. Value… is a judgment economizing men make about the importance of the goods at their disposal for the maintenance of their lives and well-being. (emphasis added)
A good’s value is the importance a man gives to certain quantities of it. That importance is based on the importance the man gives to the satisfaction which the good provides. Some things are more valuable than others. The relative values of goods depend on the relative importance a man gives to the satisfaction each good provides.
Next in this series: Mengerian Marginalism