David B. Shemano wrote:
Could someone please explain why the paradox is any different than the diamond/water paradox, which is solved by dumping the labor theory of value and substituting marginal utility?<
Smith did not solve the DW paradox by dumping the labor theory of value (though it can be solved that way). Since it takes much more labor to produce an ounce of diamonds than it does to produce an ounce of water, Smith's labor theory of value solved the "paradox." the fact that prices of production (Smith's "natural" prices) do not equal his values does not contradict this solution. -- Jim Devine / "Young people who pretend to be wise to the ways of the world are mostly just cynics. Cynicism masquerades as wisdom, but it is the farthest thing from it, because cynics don't learn anything. Because cynicism is a self-imposed blindness, a rejection of the world because we are afraid it will hurt us or disappoint us." -- Stephen Colbert.
