The labor theory of value (LTV), usually associated with Marxian economics, argues that the economic value of a good or service is determined by the total amount of "socially necessary labor" required to produce it. Often this is expressed mathematically as:


Where:

• C is the constant capital of materials used in a period plus the depreciated portion of tools and plant used in the process. (A period is typically a day, week, year, or a single turnover: meaning the time required to complete one batch of coffee, for example.)
  
• L is the quantity of labor time (average skill and productivity) performed in producing the finished commodities during the period
  
• W is the value (or think "worth") of the product of the period ( w comes from the German word for value: wert)

To put it in simple world:

Where, Value of Input include raw materials and upkeep for buildings and peoples.

Without any modifiers, a technician job cost 1 Food and 0.25 Consumer Goods for upkeep and produce 6 Energy per month, in Stellaris.

If we apply Labor Theory of Value on a technician, we can get the following equation from a Technician Job.

1F + 0.25C + 1P = 6E.

• Where: F is Food. C is Consumer Goods. P, short for PoP, stands for the labor value of a technician per month. E is Energy.

Don't forget that the labor value, P, should be added with the value of input to get the final value of job's output.

Here is the full version of equation, completed with a bunch of 0 inputs. These inputs is zero in this case but not necessary be 0 in other circumstance, for example power plant increase the output of your technician by 1 but require 1 strategics resource for building upkeep. So it is a good practice to list them all, even when they are 0.

0E+0M+1F+0.25C+0A+0S+1P = 6E

Where:

• E is Energy. M is Mineral. F is Food. C is Consumer Goods. A is Alloy. S is Strategic Resource. P, short for PoP, stands for the labor value of a technician per month.
  
• I do not count for modifier and upkeep for building and district in the above equation. Things like these will be covered in section II. In this section, we are just discussing the general theory and principle, so a simplified example is offered.

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In Labor Theory of Value, the labor value is the same for every one, no matter who you are. Therefore, the labor value per month of a ruler is the same as that of a slave.

I don’t know about real world economic, but I believe it is true in Stellaris. A PoP is a PoP. I do not care about its social status. For me, every PoP certainly has the same labor value per month.

Therefore, we could apply the same Labor Theory of Value rule into different jobs and we could get a bunch of equation from each resources job.

Every job, regardless of their social status, has the same labor value per month, which means they all have the same P in equation. Remember that P stands for the labour value per month of a PoP.


And below is the full version of equations, by adding back those 0 inputs.

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If you do not skip your math class, you can easily solve a group of equation like the below:

• x + y =13
  
• 2x - y =2

The equation group we get from Stellaris look daughting, but it is still easily solvable. Nowaday we let computer do the calculation instead of ourself. And, here is the result:

• 1 Mineral = 1.5 Energy
  
• 1 Food = 1.0 Energy
  
• 1 Consumer Good = 2.6 Energy
  
• 1 Alloy = 5.2 Energy
  
• 1 Strategic Resource = 10.8 Energy
  
• 1 month of labor value of a PoP = 4.3 Energy

The above result is very similar to the market price in Stellaris.

Because the market price of mineral is just 1.3, lower than its true value, therefore, players tend to buy in mineral from the market at the very start of the game.


To sum up. In this section, we learn that we could easily get the true value, or trading price in energy, for various resources by applying LTV theory and solve a group of equation. And the result is very satisfying, since it is valid and has a sound economic theory behind it.

1 Food trade for 1 Energy, because they both have the same efficency, that is, 1 PoP produce 6 Energy or 6 Food with the same upkeep. 1 Mineral trade for 1.5 Energy, because 1 PoP produce only 4 Mineral instead of 6 Energy with the same upkeep.

Yeah, that is law of the value of commodities from Karl Marx for you, in case you skip your economic lesson during class.

The law of the value of commodities (German: Wertgesetz der Waren), known simply as the law of value, is a central concept in Karl Marx's critique of political economy.Most generally, it refers to a regulative principle of the economic exchange of the products of human work, namely that the relative exchange-values of those products in trade, usually expressed by money-prices, are proportional to the average amounts of human labor-time which are currently socially necessary to produce them within the capitalist mode of production.

Simply put, if product A takes 100 hours of human work to produce in total, and product B takes 5 hours to produce, the normal trading-ratio of A and B will gravitate to a rate of around 1:20 (one of A is worth 20 of B), because A is worth much more than B.

If you are as lazy as me, who do not want to do the calculation work, here is the good news for you. I create a excel file to do the calculation of Section I and this calculator could count for modifier and district and building upkeep.

The file look like this.


What you need to do is:

1. Fill in the data from Stellaris into the green area, A3:G8 and H3:M8. Green area A3:G8 are data from job’s tooltip. Green Area H3:M8 are data from district and building.
   
2. Copy data from orange area P3:W8 into Octave and press Enter. Then Copy data from orange area Y3:AA9 into Octave and press Enter. Octave would do the calculation for you.
   
3. Copy result from Octave and paste it into red area AD3:AD8.
   
4. Enjoy the calculated price, in energy, for your various resource.

I would choose one of my late game save, year 2355, as an example to guide you through the process.

Take technician for example, the ingame job tooltip show it produce 24.5 Energy and cost 1.1 Food and 0.2 Consumer Goods. And we fill 24.5 in cell B3, -1.1 in cell C3 and -0.2 in cell E3. Positive for production and Negative for cost and upkeep.


PS: I have 1.1 food upkeep due to edict which increase grwoth rate at the cost of foods. I have 0.2 Consumer Goods upkeep due to tradition which reduce my pop, district and building upkeep by 10%.

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A technician need power district and power building for job and increase capacity. Power District cost 0.9 E and offer 2 jobs. Power capacity building cost me 1.8 E and 0.9 S for upkeep and this upkeep are shared by 24 technician. Therefore, I fill “=-0.9/2-1.8/24” in cell H3 and fill “=-0.9/24” in cell M3.













You just do the same for other jobs.

PS: The reason why cell B6 from artisian jobs has +2 Energy is that I have master crafter civic which gives +2 trade value for artisian and those trade value could transfered into +2 energy.

PS2: The content of cells is “Production - Upkeep”. For example, in Cell D5, I have "=-1.1+30.1". -1.1 is food upkeep for pop. It is -1.1, because I have an edict which increase my food upkeep by 10% and increase PoP growth. 30.1 is the food output of my farmer.

PS3: Oh, yes. I am Chinese. It is the reason that there are so many grammar error in this guide and I am so familiar with Marxian Economics and math.

PS4: Before your asking, yes I am a communist too. Come and hunt me. ^ ^
Just kidding. We learn communism at school, but no one take it seriously. The idea behind it is great and ambitious, but sadly not practical. For communism to be successful, everyone has to be a saint. And we are all just ordinary people. People who has their own interest and desire. And that is why there are so many wrong doing under a great idea.
“O Liberté, que de crimes on commet en ton nom! (O Liberty! What crimes are committed in thy name!)” ― Madame Roland

Data in orange area serve two purpose.

• First to sum up the all the cost, upkeep and production from green area.
  
• Second to preprae the data in a form which Octave can regonize and compute.

Octave[octave-online.net]
Copy data from orange area P3:W8 into Octave and press Enter.

Then Copy data from orange area Y3:AA9 into Octave and press Enter.

Copy data below line “ x = ”, as the below highlight area in the picture.
PS: It is highlighted because I selected it therefore I can copy it.

And here is the final result. In this game, one mineral has a value of 1.2 energy, casue production of mineral is not as efficient as energy. One food has a value of 0.8 energy, due to the fact that I found a planet with 40% food production bonus. Etc.









PS: If you are lazy, you could skip the step, in which you fill data in green area H3:M8 which corresponding to upkeep of district and building. From my testing, the result is very simmilar. The below picture show the two result, while the right column is the result without counting upkeep of district and building.








The reason is that buildings' upkeep are shared by many PoPs, therefore it is very small in the end. District's upkeep is small at the very begining.

Absolute advantage is the ability of an individual, company, region, or country to produce a greater quantity of a good or service with the same quantity of inputs per unit of time, or to produce the same quantity of a good or service per unit of time using a lesser quantity of inputs, than its competitors.

The concept of absolute advantage was developed by Adam Smith in The Wealth of Nations to show how countries can gain by specializing in producing and exporting the goods that they produce more efficiently than other countries, and by importing goods that other countries produce more efficiently. Specializing in and trading products that they have an absolute advantage in can benefit both countries

Generally speaking, Energy is more efficent than mineral. After patch 3.5, the new added feature of planet auto management accept energy as raw material to build building. Therefore, it highly increase the usefulness of Energy and reduce the use of mineral into producing alloy and consumer goods mostly. And mineral is quite aboundant from mining station, which requires not labour. That is why it is a good idea that player focus on produce energy only and try to trade in mineral from AI, as long as AI offer a better exchange rate than yourself.

"The people who know what a stock is worth will always buy it when it is selling at bargain prices."

From a financial capital point of view, there are three ways of gaining value in Stellaris.

First, you create value through production by employing PoP, which is simillar to how real world fabrication industry work.

Second, you gain value through investment. In investment, you pay upfront and get return over time. Claiming an system or Building solar panel starbase are investment. They do no't require labour. Capital generates values from itself.

Finally, instead of creating or investment, you gain value through capital itself by trading and making profit out of thin air through trade. The more trade you do the more profit you gain. In this way, you are basically robbing AI by exploiting Information asymmetry regarding resource price.



Due to the fact that production of energy is more efficient thant mineral. Mineral would always cost higher than energy. Therefore a common trick that player frequently use is to buy in mineral from market at 50 untis per month. It is better than producing mineral yourself.

When the galatic market is open, I tend to sell and buy in a large quantity of goods from the market as long as it is profitable. Also, I would sell my alloy if the price is very high, such as 8 energy. And with my calculator, I know exactly which price is profitable for me. There is risk when relying on outside source, therefore I try to keep a high inventory volume.


We also do not just stop on a Win-Win trade deal with AIs as Adam Smith suggested. We use all our resources as capital, and engage in aggressive trading for the sole purpose of gaining benefit. When gambling, the one who know the result would always win, and you have that kind of information since you have my calculator for the true value of resources.

Stellaris AI has a tendency of value food, strategic resource and mineral too high. Therefore, I enjoy selling my strategic resource and occasionaly food to AI very much. Since I seldom produce mineral myself, I am in constant need of mineral and I am in no position of selling my imported mineral.

100 strategic resource for 4110 energy, it is like selling strategic resource at a price of 41.1 energy, which is way too high.




















A good practice of going into aggresive trade war is that you can trade your strategic resource with AI aggressively and drive their energy/mineral stock and monthly income near zero. You buy in all their available invenotry and the next 30 years income too. In this way, theri economic is crippled. They do not have enough energy or mineral for daily upkeep and they have to sell strategic resource, bought from you, to the market for energy or mineral.

Nevertheless, they are screwed by accepting a worse deal with you at the first place. I tend to find out that AI who trade with me frequently would fall in power very soon.

Secondly, when they are forced to sell in market, the price would fall and you could buy back the strategic resource you just sell in a much lower price. Double win for you.

Link For the Calculator[docs.google.com]

PS: This guide is written at the time of Stellaris 3.6.