Principles of Economics by Carl Menger Chapter 6C - Changes Between Use and Exchange Value

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How does the value of a good shift over time—and what drives those changes? In this video, we explore Carl Menger’s Principles of Economics, Section 6C: The Shift in the Economic Center of Gravity of the Value of Goods.
A central task in economics is deciding whether a good is more valuable to use or to trade. Menger shows that this decision isn’t fixed—it changes with personal needs, market conditions, and the condition or quantity of the good itself.
Imagine someone loses interest in wine or hunting. What once had high use value now only holds exchange value—so they sell it. As people grow older, change careers, or experience shifts in lifestyle, they often reassess what’s worth keeping versus what’s worth trading.
The condition of a good also matters. A damaged coat may no longer be sellable, but it might still be perfectly useful. On the flip side, something barely damaged might lose its use value to a wealthy owner but still retain trade value on the market.
But the biggest influence? Quantity. A surplus lowers use value and increases the incentive to trade. Scarcity raises use value and makes people hold onto what they have. Wealth changes value perceptions, too: the newly poor sell off luxuries; the newly rich replace modest goods with higher-end ones.
Menger’s insight: value is always about meeting needs, and the dominant form of value—use or exchange—depends on how a good best serves that purpose.

❓ Questions This Video Answers:
-Why does the value of a good shift over time?
-What determines whether use value or exchange value matters more?
-How does personal change affect economic decisions?
-What role does the condition of a good play in its value?
-Why does surplus lead to more trading?
-Why do the wealthy and the poor treat goods differently?
-What happens when supply shrinks or wealth grows?
-How does family life affect economic decisions?
-Can a worthless good in trade still be useful?
-What’s the main factor in choosing to use or sell something?

00:00 - Introduction to Economic Center of Gravity of the Value of Goods
00:12 - Use Value or Exchange Value
00:51 - Changes in Personal Needs and Preferences
02:05 - Changes in the Condition of Goods
02:39 - Changes in Quantity and Wealth
03:50 - Outro

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