There is still no consensus in modern science on the nature of the key economic concept of value (not price). There is an illusion that this does not interfere with life and the economy in any way, however, we remind people who have learned how to make paper airplanes that fly well, but without understanding the true nature of flight, they cannot move on to full-fledged aviation. To date, there are three main camps on the issue of value: cost-based (primarily labor value theory), marginal, and behavioral ones. It is believed that each of these theories partially solves the question of the nature of value, and together they provide a completely satisfactory answer. However, while economics does not fully understand what it operates on, the usefulness of existing, even very widely accepted, theories rests on a very shaky foundation.
 
Let me briefly recall the main ideas of the three dominant trends in the theory of value:
1. Labor. The emphasis is on the object of value, the value is objective and is determined by the costs that went into its formation (social labor and time). Key weaknesses: it does not explain the high value of resources that are not directly related to costs, or the costs were very small (for example, Picasso's drawings), it does not explain the large variation in value for the same object for different subjects.
2. Marginal utility. The emphasis is shifted to the subject, and the value itself is declared completely subjective. The subject is considered to be a fully rational, informed being who is engaged in maximizing the benefits to his advantage. Key weaknesses: inability to explain irrational or altruistic consumer behavior, cannot explain the existence of unsaturated needs (for example, thirst for fame), does not take into account the instability of preferences.
3. Behavioral. The focus has shifted to cognitive biases in decision-making and irrationality in consumer behavior. Key disadvantages: weak predictive power and mathematical apparatus, fragmentation and lack of a unified theory explaining the economic actions of subjects.
 
All the listed leading schools of economic thought have one thing in common – they do not have a satisfactory answer to the question of the fundamental nature of value, and the last two evade the answer altogether.
 
In this paper, I propose a solution to this issue based on the following provisions, which form the basis of the Probability-Time Theory of Value that I am putting forward:
1. Everything has value that is potentially capable of satisfying the fundamental need of the subject, which is to survive in nature and society.
2. Value is not perceived directly, but through the complex prism of indirect signals from biological and social valuation tools developed by natural selection.
3. People's needs and preferences obey the laws of statistics and are described by normal and lognormal distributions, as a result of the fact that the factors influencing a subject's consumer decision, regardless of their initial distribution, obey the Central Limit Theorem.
4. The value of a resource is determined by the time that this resource can provide to the subject.
5. The value of a resource is necessarily formed taking into account the risk of not meeting the need.
6. The magnitude of the risk of need not being satisfied is subjective due to the fundamental incompleteness of the information and the quality of the subject's judgment.
 
One can understand the nature of value only by taking a closer look at the nature of the being who has the concept of value and operates on it every day, i.e., man. Let's analyze what really has value and how we humans evaluate it.

Thesis 1: Everything has value that is potentially capable of satisfying the fundamental need of the subject, which is to survive in nature and society.
Humans as a biological species have gone through a long evolution, as a result of which they have developed multiple survival tools, both biological, social and cognitive. From a biological point of view, humanity, like any other species, has no other fundamental need besides survival. Therefore, everything that contributes to survival is uniquely valuable to humans, i.e. it has value. In particular: food, clothing, housing, weapons, health, the possibility of reproduction. Man survives not only in nature, but also in society. There is a constant struggle for position in society, influence, power, status, and freedom. Therefore, everything that contributes to this also has a value. These include, for example, dating, education, position, rank, wealth, and transportation. As a social being, a person can realize the limits of survival in different ways - it can be not only a species, but also an individual, a family, a nation, a religious denomination, or a political party. At the same time, the goals of survival are achieved with all possible set of tools developed by evolution: from extreme selfishness (saving my life will save part of humanity, nation, clan, family) to extreme altruism (saving life of someone else I will save part of humanity, nation, clan, family). Therefore, someone simply prefers domestic beer or Christian rock, while someone will close the embrasure with their chest to save their comrades in arms. All such behaviors have a practical, from the point of view of survival, meaning.
 
Thesis 2: Value is not perceived directly, but through the complex prism of indirect signals from biological and social valuation tools developed by natural selection.
As a physical body and a biological being formed and existing in certain conditions, a person is forced to cover a significant number of needs necessary for survival. At the same time, man first developed his biological nature and only relatively recently his cognitive-social nature. Being an extremely complex biological being, man has developed various indirect mechanisms of encouragement, punishment and prevention. For example, a person needs to eat and drink to get energy. However a person does not have an immediate desire to get energy, but there is a desire to eat, he does not want to prolong the race, but he wants to have sex, he does not want to directly increase the likelihood of getting food and prolonging the race, but he wants status in the community. A person has no immediate desire not to eat dangerous food, but the smell of rot and decomposition is unpleasant to him. That is, a person perceives the value not directly, but through a set of indirect signals: pleasant, unpleasant, joyful, painful. As a result, everything that can cause such feelings, even without being a survival factor, is perceived as something valuable, for example, music, a flavor additive, a painting, a drug. However, the most powerful tool for human survival is the ability to think and its highest form – rational thinking. It was thanks to him that man gained the position of the dominant species on Earth. This tool often comes into conflict with biological needs and at the same time creates new needs that other species do not have, for example, the desire to get an education, be famous, invent and compose. As a result, we observe a combination of rational and irrational actions in human behavior. For example, a higher education diploma may be perceived as more valuable than the knowledge itself.
 
Thesis 3. People's needs and preferences obey the laws of statistics and are described by normal and lognormal distributions, as a result of the fact that the factors influencing a subject's consumer decision, regardless of their initial distribution, obey the Central Limit Theorem.
If we try to measure the value of a particular resource in a random but similar group of people on a subjective scale of desirability, for example, from 0 to 100, we will find that most people rate it close to a certain value of X, slightly fewer people rate it a little more and a little less than X, and very few people, who value it very little or extremely much. That is, we will see a distribution close to normal. The fact is that literally every event, both external and internal, affects any desire or preference in two ways – either it somehow strengthens or somehow weakens it. And since the nature of events is mostly random in relation to a specific potential desire, the outcome of their overall impact is described by the Central Limit Theorem from the theory of statistics. Let me remind you that the CLT states that regardless of the initial distribution, the average of random samples from such a distribution is described by a normal distribution. At the same time, if the number of factors in the samples is limited and close, then the amounts, and not just the average, of the factors are also described by a normal distribution. That is, since a person is exposed to a huge number of influences (weather, mood, fatigue, noise on the street, advertising, screams in the next room, faulty air conditioning), most of them are independent, then his desires and preferences are the total statistical result of such interactions at a specific time and are described by the CLT.
 
Thesis 4. The value of a resource is determined by the time that this resource can provide to the subject.
Surviving primarily means prolonging life, i.e. increasing the available time (for oneself or for a group of people with whom a person associates himself). This makes time an absolute commodity, since it has no direct substitutes, it is impossible to receive or give it directly, and at the same time it is, in fact, the main measure of value. At the same time, time can be bought and sold indirectly. For example, if someone needs to dig a large hole, then they have three options: do it themselves without any tools, use some kind of tool (for example, a shovel), or entrust it to someone else. The first option is the cheapest in terms of money, but the most expensive in terms of time. Therefore, by choosing the second or third option, a person pays, in fact, not for a tool or work, but for the time that he will save. Thus, a shovel seller or a digger is not actually selling a product or service, but indirectly selling time. And that's why doing something on your own without any help is the least worthwhile, as it leads to the greatest loss of time.
 
Thesis 5. The value of a resource is necessarily formed taking into account the risk of not meeting the need.
The time we're trying to buy lies in the future. But the future in uncontrolled systems is predictable only with a certain probability, always different from 100%. Moreover, all events have a different probability of realization, which changes dynamically. This is caused by too many influencing factors in such complex systems as society and the economy. Even such a fundamental law as the law of supply and demand, which states that lower prices lead to higher sales, may not work in real life, since there is always a chance that competitors will lower prices even more, or a substitute will appear on the market at that time, which will simply make your product unnecessary. This does not mean that the law of supply and demand is not true, but it does mean that it is true only if all other factors and circumstances remain unchanged, which never happens in real life. Since the future is not reliably determined, and any resource may show its ability to satisfy a need in a different way, depending on the circumstances, there is always a risk that the subject will not receive what he expected – this is the risk of unsatisfied needs (RUN). And the higher the risk, the lower the value of such a resource. Or, in other words, the weaker the resource removes this risk, the cheaper it is. For example, a product in a transparent package is valued higher than in an opaque one, since opaque packaging has a higher chance that the product is not of the desired quality and quantity. Money is valued more today than the same amount after, for example, 100 days, as there is a risk of not receiving it at all, even if deflation is observed outside the window. The services of a good plumber are valued more highly than those of a beginner, as the risk that they will not perform their task properly is noticeably lower. A person is willing to pay more for a familiar brand because the probability of getting exactly what you expect is noticeably higher. In the extreme case, when a person is offered to set a price for a certain product about which he knows nothing at all and which he does not know when he will be able to receive, i.e. with an extremely high risk of not getting anything valuable, he will rate it extremely low. Thus, the higher the RUN, the lower the value.
 
Thesis 6. The magnitude of the risk of unsatisfied needs is subjective due to the fundamental incompleteness of information and the quality of the subject's judgment.
The subject never has sufficient information and computing resources to accurately assess the uncertainty associated with time, the ability of a resource to meet a need, and how easily substitutes can replace it. An individual evaluates all risks associated with these types of uncertainty subjectively, based on his experience and judgment abilities. This is especially evident in stock market transactions, when every transaction occurs in a situation where the seller is sure that the security will become cheaper, and the buyer is sure that it will become more expensive, even with completely equal access to information. Different experiences, different powers of judgment, different expectations, different additional external and internal factors lead them to a completely opposite assessment of the same resource, under the same general circumstances. In fact, by performing any, absolutely any action, the subject is betting on the future, and the higher the uncertainty, the non-linearly higher the expected reward, sufficient to justify the action, which always involves the expenditure of some resource and time.
 
Summarizing all of the above, we can say that the value of a resource is a subjective potential ability to prolong the life of the human community with which the subject associates himself, taking into account his subjective assessment of the likelihood of such a function:
 

V=T*P

That is, the value is the product of the time provided by the resource and the probability that it will happen.
 
Using selected examples, I will show that the key productive concepts of existing theories of value are special cases of the Probability-Time Theory of Value (PTTV).
 
• The law of Marginal Utility, which states that with each new portion of a resource, its marginal value decreases, in terms of PTTV means that with each new portion of a resource, the risk of unsatisfied needs (RUN) decreases, since it has already been partially satisfied, which means that the value of this resource as a risk mitigation tool decreases.
 
• The famous "water and diamond" paradox, which reveals the role of resource scarcity, states that water is extremely valuable for life, but since there is a lot of it, the marginal utility of the last glass is very small, and with it the value of water is low, while diamond is not critical for life, but its value is high, since there are few of them, and even the least valuable last available diamond on the market satisfies a very important need for someone, which is highly valued. From the point of view of the PTTV, the rarity or abundance of a resource that is able to satisfy any need is expressed in the risk that this need will not be satisfied: when there is a lot of resource, such a risk is very small and there is nothing to pay for, and vice versa. As a result, it is not the rarity of the resource itself that is important, but its ability to reduce the RUN, i.e. the risk of not getting what the subject wants. At the same time, rarity acts as a very simple and convenient indicator of the size of such a risk, but not as a source of value.
 
• The law of supply and demand – the more a certain resource or its close substitutes are on the market, the lower its price, and vice versa. In addition to the above about the role of resource scarcity in terms of PTTV, it is necessary to take into account that in addition to buyers, there are sellers on the market who participate in pricing and risk assessment. If there is a lot of a certain product (resource) on the market, from the seller's point of view, the risk of not selling it increases, not getting money for it, which means the risk of not meeting your own needs increases, and lowering the price is a tool to reduce this risk. Lowering the price increases the likelihood of selling the resource, as this leaves the buyer with more money, which means it reduces the risk of not meeting his other needs, which means it is appreciated by the buyer.
 
• The time value of money. From the point of view of the generally accepted theory, the value of money today is higher than the value of exactly the same amount tomorrow or in any other future time interval. This is usually explained by the fact that money can be invested in a risk-free instrument, for example, government bonds, and over time they will bring some income. From the point of view of the PTTV, the difference in value arises from the unpredictability of the future, uncertainty, and the longer this period, the greater the risk that you will not see your money at all, partially or completely, or that you will be able to buy less with it due to unpredictable price changes. At the same time, in the classical scenario of estimating the time value of money, the discount coefficients simply multiply, which creates the illusion of some kind of predictability. From the point of view of the PTTV, each subsequent period of time that does not occur carries a non-linearly greater risk of devaluation of money that cannot be objectively assessed, and the longer the time, the more "black swans" there are.
 
• The labor theory of value asserts that value is objective in nature and is expressed in the amount of socially useful labor and time spent on the production of goods and services. From the point of view of the PTTV, labor really creates value, which, at the same time, is formed not by the fact that socially useful time and efforts have been spent, but by the fact that the RUN has been reduced as a result. And the higher the risk, the higher the value of such labor. For example, the services of a mediocre tutor are valued significantly less than the services of a very good one, even if they spend the same time and effort and have spent the same effort and time on their training and have very similar experience. The difference in the value of services from the point of view of the PTTV lies in the different ability to reduce the risk of not achieving the desired result.
 
• The paradox or the possession effect, often referred to in behavioral economics as a form of cognitive distortion without explaining its nature, is that a person values the same thing more when he owns it than when he does not own it. From the point of view of the PTTV, there is no paradox here, since from the point of view of assessing the risk of survival, the loss of a resource causes more harm than the acquisition of the same resource benefits. The simplest example is that you are riding a two–wheeled bicycle, and losing one wheel carries significantly more risks and problems for you than the third wheel can benefit you.
 
• The effect of the "accessibility heuristic" from behavioral economics, when people evaluate the probability of an event or the importance of a phenomenon based on how easily relevant examples come to mind, rather than based on real statistics. For example, after watching the news about a plane crash, a person subjectively overestimates the risk of flying and underestimates the risk of traveling by car, although statistically the second risk is higher. From the point of view of the PTTV, there is also no surprise here. Since our assessment of the importance (value) of a certain event is formed, among other things, by biological mechanisms for assessing survival risks, therefore, an event that occurred or was mentioned recently is perceived as more likely, since it has retained a stronger imprint in the nervous system.
 
Thus, the Probability-Time Theory of Value:
• for the first time fully answers the question of the fundamental nature of value, based on simple, unified principles,
• it covers the problematic areas of existing theories well, which act as particular forms of PTTV,
• indicates a potential mathematical apparatus for assessing and predicting economic phenomena,
• allows us to look at the question of what needs to be achieved in the economy both at the level of an individual or a company, and at the level of the national and global economy in a different way.