Imagine you’re sitting in the office and there’s a glass of water on your desk. It’s a normal glass of water. Your everyday glass. So if someone asked you how much you’d pay for that glass of water, your answer would probably be: “nothing.”
However, if you were in the desert dying of thirst, after walking for hours, you would probably be willing to give up everything you were carrying, from your money to your watch or your phone, for a glass of water.
What has changed? Your need has changed. Your perception of value has changed. And that, in essence, is what Carl Menger proposed as the imputation principle: things don’t have a fixed intrinsic value; their ultimate value depends on how much they contribute to satisfying our needs at a given moment.
Value is not only in things, it is in you
Carl Menger, one of the founders of the Austrian School of Economics, proposed the subjective theory of value, in which he questioned whether the price of products could be set based solely on their production costs.
Menger believed that everything begins with our needs, which constitute the basic driving force, along with the constraints we face. Therefore, according to his principle of imputation, the value of a product does not depend solely on objective factors, such as the cost of materials or labor, but is largely determined by our decisions, aspirations, and needs. It is we who add or subtract value according to its usefulness.
This economic principle applies to our daily lives, beyond money and markets. It’s present, for example, in how we value our time, our relationships, and even our weaknesses and strengths.
How many times do we not value something until we lose it?
How many times do we despise the everyday, simply because it is available?
And how many times do we overvalue what is scarce, what is urgent, or what is about to go?
The paradox of the singular: When the rare becomes precious
In the 1970s, Stephen Worchel conducted a very interesting experiment in which he offered participants cookies. He told some that there were plenty of them, while others were told that there were only a few left and no more would be made. People who thought the product was scarce considered the cookies to be better and were willing to pay more for them.
The scarcity effect is one of the pillars of Menger’s imputation principle. It pushes us to value something more, simply because we perceive it as limited, unique, or difficult to obtain. Obviously, confusing value with urgency can lead us to make bad decisions.
When we believe something is about to disappear (an opportunity, a person, an offer), we feel compelled to act without reflection. We buy things we don’t need, we enter into relationships out of fear of loneliness, we accept unfair terms simply to avoid “missing out.” This anxiety about something slipping away makes us choose impulsively, not with clarity and objectivity.
In relationships, scarcity bias can lead to dependency behaviors. For example, if we idealize someone simply because they appear emotionally distant, we run the risk of accepting their toxic or unstable attitudes. Thus, instead of seeking healthy, reciprocal bonds, we end up trapped in dynamics where the unattainable becomes desirable, even if it doesn’t do us any good.
“Emotional inflation”: When everyday life loses value
Menger’s imputation principle also reveals that value decreases as supply increases. This happens to us constantly in our daily lives. When we get used to having something, we stop appreciating it. This is known as hedonistic adaptation.
This was confirmed by researchers at the University of California, who recruited a group of people who had recently experienced positive changes in their lives. All reported increased levels of happiness immediately after the change, but this decreased as the weeks passed.
We feel happy when we have positive experiences, but if we repeat them over and over again, they will soon become familiar—no matter how wonderful they may be. As a result, that new source of happiness will gradually dry up, generating less and less pleasure and satisfaction.
That familiarity can also push us to make bad decisions. Since we no longer feel the same enthusiasm or gratitude for what we have (whether it’s a stable partner, a good job, or an always-available friend), we begin to seek out new things without realizing that we’re failing to nourish what truly sustains us. This dissatisfaction, born of taking things for granted, pushes us to change what works, eager to experience something different.
Emotionally, this can translate into unnecessary conflicts or avoidable breakups. We undervalue everyday life because we believe we should feel love or happiness with the same intensity as at the beginning. We fail to recognize that consistency and commitment, although less conspicuous, are profoundly valuable because they provide stability and security. Thus, we stop showing affection, we stop caring, until what was once firm begins to crumble.
The great challenge: looking with different eyes
In life, we constantly oscillate between hedonistic adaptation and scarcity bias. As a result, we can cling to meaningless goals or relationships while losing our appreciation for what we have, eventually losing it.
Influenced by these biases, emotions, and urgencies, our minds constantly change the value we assign to things. To learn to value them properly, it’s helpful to do some emotional accounting from time to time.
Stop and ask yourself: “How would I feel if this were the last time?” (the last coffee, the last conversation with your mother, the last sunset…). Mentally play the game of losing what you love… to appreciate that you love it more.
The challenge posed by the principle of imputation is to learn to value what we have today. We mustn’t wait to cross the desert to value water. Nor wait for absence to appreciate presence. We don’t need pain to open our eyes to the privilege of being alive.
References:
Sheldon, K. M., & Lyubomirsky, S. (2006) Achieving sustainable happiness: Change your actions, not your circumstances. Journal of Happiness Studies; 7: 55–86.
Worchel, S.; Lee, J. & Adewole, A. (1975) Effects of supply and demand on ratings of object value. Journal of Personality and Social Psychology; 32(5): 906–914.
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