All trade is unequal in value.  That’s why it happens.  Each person gives up something they value less to get something they value more.  That’s the essence of exchange.  If both goods were seen as equal by both parties, there would be no reason to trade.  You’d keep what you had.

This difference in valuation is what drives the market.  One man sells shoes to get dollars.  Another gives dollars to get shoes.  Neither believes they’re losing.  They both think they’re coming out ahead.  If they didn’t, the trade wouldn’t happen.

Value is not something that can be measured.  It can’t be weighed or calculated like a length or volume.  It’s entirely subjective.  It lives in the mind.  What something is worth to you depends on your situation, your preferences, and your knowledge—none of which are the same as anyone else’s.

People confuse price with value.  They are not the same.  Price is the number agreed on.  It’s what’s paid.  Value is the reason for paying it.  You can’t see value on a receipt.  Two people can pay the same price and walk away with completely different feelings about what they got.

Profit comes from this gap.  You buy something because you expect it to give you more satisfaction than what you gave up.  That’s profit—even if it’s not measured in money.  If you sell something for more than it cost you, you earn a money profit.  If you sell for less, it’s a loss.  In both cases, the expectation was gain.  That’s why you acted.

All action is speculative.  You act because you expect a better result.  You never know for sure.  The world is uncertain.  Time moves forward.  Mistakes happen.  Trade only takes place because both sides expect to benefit.  Even when one side is wrong, the exchange was still voluntary.  That’s the key.

There is no such thing as a “fair price” set by an outsider.  Fairness depends on perspective.  What’s fair to one might be outrageous to another.  Only the individuals in the exchange can judge it.  Only they know what they’re giving up and what they’re gaining.  A price freely agreed to is fair by definition.  Anything else is interference.

Some say profit is exploitation.  That’s a mistake.  Profit is a sign that someone provided value.  It means someone took a risk, made something others wanted, and exchanged it voluntarily.  No one is forced to buy.  No one is forced to sell.  Coercion doesn’t create profit—it destroys it.

Trade is built on disagreement.  One person values the good more than the money.  The other values the money more than the good.  That difference is not a problem—it’s the solution.  Without it, there’s no movement.  No cooperation.  No economy.

Attempts to make all value equal flatten the human experience.  They erase the diversity of wants and needs.  They treat people as identical.  People aren’t identical.  They don’t want the same things.  They don’t value the same things.  That’s not inequality.  That’s individuality.

Markets thrive on this.  They allow people with different goals and perspectives to cooperate.  They turn subjective values into objective prices—prices that help others plan, produce, and improve.

Wealth doesn’t come from sameness.  It comes from difference.  It comes from each person pursuing their own goals, making trades that seem unequal to outsiders but make perfect sense to the people involved.

Trying to make every exchange “equal” in value is not justice.  It’s paralysis.  It stops the very engine that drives prosperity.

Trade works because we disagree, that’s a good thing.

References

Ludwig von Mises; Human Action

Murray Rothbard; Man, Economy, and State