Once again a reporter is citing Laura’s brilliant description of the labor theory of value, meaning that money or a good is worth the amount of labor it took to produce it. Father Wilder is used as the character to explain the lesson when he gives Almanzo a 50 cent piece, but convinces him to invest his money in a pig rather than spend it on lemonade.
The theory was developed by British economist David Ricardo who based his economic work on Adam Smith’s pioneering work The Wealth of Nations. In simplified form, it holds that a clock that costs $100 has ten times the labor in it as a $10 pair of shoes or that all that the value in something comes from labor which leads to very interesting conclusions about wages and inflation, but you can look those up for yourself. 
By the way, the theory has now fallen out of favor in modern ecomonics and been replaced by the marginal theory of value which says that both supply and demand influence value. In the classic example my economic professor gave me, once you have 10 pairs of identical orange tennis shoes, will the 11th pair have as much value to you as the first pair did?
Tags: Economics, Farmer Boy (book), Labor Theory of Value, money, Value
