Discounted cash flow valuation spread from bonds to all goods via neoclassical utility theory.

Evidence

This technique, which is more than a century old (Doganova 2014; Parker 1968) and was initially used mainly to value financial bonds, has become generalised and is now presumed to be valid for any kind of goods. It can be seen as a consequence of the adoption of Utility value by neoclassical economics, and is closely associated with the name of Irving Fisher, an American economist who at the beginning of the 20th century proposed a new theory of capital and income associated with a set of actuarial metrics (1906). Under the utilitarian definition, the value of goods lies in the services they will provide in the future. — Ève Chiapello, Financialisation of Valuation, 30

Categorization

• XREF: The generalization of a bond-valuation technique to ‘any kind of goods’ is a concrete instance of financialized valuation colonizing non-financial activity — exactly the reader’s focus. — connects to: Classical utility theory defines value by final wealth with diminishing marginal returns — John T. Jost and Jim Sidanius, Political Psychology, 2412; Investor-style valuation techniques now shape public policy with coercive force — Ève Chiapello, Financialisation of Valuation, 108; Stock valuation discounts future dividends because present money earns interest. — Donald MacKenzie, An Engine, Not a Camera: How Financial…, 205
• ADDENDUM: Relates to how economics’ adoption of utility value supplied the conceptual warrant for applying an investor’s lens to all goods — a mechanism-level complement to the valuation-colonization theme.

Broader Connections

• Classical utility theory defines value by final wealth with diminishing marginal returns #expands (0.80) — John T. Jost and Jim Sidanius, Political Psychology, 2412