Value and Scarcity

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Sports Memorabilia
Have you ever been to a major league baseball game and watched fans race to a ball that was hit into the stands for a home run? Why do you think there is so much hype over an old, used baseball? It is because the talent that these professional athletes have is rare, and it gives value to that ball because it came off of a major league baseball field. Balls like that are hard to come by, and many people would pay dearly for one.
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Clean Drinking Water
Drinking water would be free if it was not a scarce resource. In developed countries, clean drinking water is often taken for granted even though it comes at a price. Many people in third world countries are forced to drink water that is not sanitary even though they know it could make them sick. In these countries, clean water is a precious resource that is not taken for granted.
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Painting by Claude Monet
Similar to a celebrity athlete, artwork done by a famous artist is valuable because it is rare. Although this is not an actual painting done by Claude Monet, much of his work was inspired by water lilies. Would you believe that one of his paintings recently sold for over 43 million dollars? Why would someone pay so much for a painting of flowers? It is the principle of scarcity. Claude Monet is among the world's most famous artists to ever live. His work is valuable because talent like his is uncommon.
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Clean Air
Most people would say that air is an unlimited resource. It probably is the closest that you can get to a resource being unlimited, however clean air comes at a price. The Clean Air Act, which identifies the resposibilities of the EPA to protect the nation's air quality, is estimated to cost nearly 65 billion dollars by the year 2020. This is a high price to pay, but clean air is valued because of the better quality of life it can give many people.
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Time is another scarce resource. We are all given 24 hours in a day, and we are not promised tomorrow. We must use our time wisely.
Society places monetary value on time, which is why we have wages. Some people's time is worth $100 an hour while others might only get paid $7 an hour. You are at a point where you have to decide how much your time is worth. Would you be willing to work 60 hours a week for $5 an hour? Is time spent in college worthwhile? How much is leisure time worth to you?
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Hopefully by now you can see that scarcity creates value when that scarcity is desired. We all have limited resources and are faced with choices regarding how we will use them.