The Theory of Value is Once Again Up for discussion

How the Rutigliano Theory of the Evolutionary Formation of Value (TRFEV) was born

By Pablo Rutigliano

Every economic theory begins long before it becomes a book, an equation, or an academic article. It begins with a question. In my case, that question accompanied me for years of work linked to the development of productive projects, mining, the digital economy, and traceability processes. It was a concern that appeared again and again in the face of very different realities, but with a common problem: there were assets with enormous economic potential that could not find an objective way to demonstrate how much of that value had already been built. It was not a matter of lack of productive capacity. Nor of an absence of innovation. It was, above all, a difficulty in describing and measuring a process that traditional economics usually observes only when a market price appears.

It was then that I understood that perhaps the problem was not in the tools available to value consolidated companies or assets that are already traded, but in what happens much earlier. Most of economic life takes place before an organized market exists. A deposit still under exploration, a technological patent, an infrastructure under development, an industrial innovation, or an agricultural project go through a long path of growth before reaching maturity. That journey involves investment, knowledge, risk, evidence, labor, rights, permits, and technical capacity. However, that process rarely finds an economic representation that allows it to be described comprehensively.

That is where the concern that eventually gave rise to the Rutigliano Theory of the Evolutionary Formation of Value (TRFEV) was born. It did not arise with the intention of replacing the classical theories of value or of disregarding the enormous contributions made by generations of economists. It arose because I understood that there was still a space for research related to the way in which value is formed before it becomes price. That is the question that structures the document: how to describe, measure, and verify the process by which an asset builds value before there is a market that reflects it.

The most curious thing is that the initial inspiration did not appear while reading an economics treatise, but rather by observing a natural phenomenon. The metamorphosis of the dragonfly offered me an unexpected conceptual model. For a good part of its life, this insect remains underwater as a nymph. At first glance, it does not possess the characteristics we associate with the adult dragonfly. However, all its biological potential is already present. Each transformation incorporates new capacities until reaching maturity. I understood that an economic asset goes through a similar process: it does not appear fully developed from the first day, but rather evolves through verifiable stages. That analogy does not intend to turn a biological phenomenon into an economic law; it works as a conceptual guide to think of value as a process and not as an instantaneous event. The document itself uses this image to explain the central thesis of the theory.

From that observation, I began to identify patterns that were repeated in projects of different kinds. I discovered that there were common dimensions whose evolution conditioned the maturation of value: technical evidence, legal certainty, information quality, traceability, governance, productive utility, regulatory compliance, and residual risk. None of them, by itself, explained the development of an asset. All interacted with each other. That finding led to the construction of a formal model and an Asset Maturation Index (IMA), designed to synthesize the degree of verifiable development of a project through explicit and reproducible criteria.

One of the principles that guided the design of the model was to avoid excessive simplification. In economic practice, an outstanding strength does not always compensate for a critical weakness. A project may have excellent engineering, but if it lacks solid rights, it can hardly be developed. Likewise, great technological infrastructure does not substitute for the absence of productive capacity. For that reason, the document adopts a multiplicative mathematical structure, which seeks to reflect that interdependence between dimensions. It is not a formula designed to impress, but rather a tool intended to represent an economic intuition: verifiable value depends on the joint development of essential factors and not on the isolated sum of attributes.

The theory also proposes a distinction that I consider especially relevant: the difference between potential value and verifiable value. Every project can have significant economic potential, but the truly important question is how much of that potential can be demonstrated today with objective evidence. That difference constitutes the so-called "verification gap," which the document presents as a central economic variable of the maturation process.

We also live in a moment of profound transformation. The world economy is increasingly incorporating digital technologies to record assets, contracts, and processes. This evolution poses a conceptual challenge: technology allows information to be represented more efficiently, but it does not replace the need to understand what that information represents. From that perspective, the TRFEV holds that digital representation does not create value; it records and preserves the history through which that value was built. That distinction is especially important in a context where the digitalization of the economy is advancing at great speed.

If this proposal manages to provide a useful tool for describing the state of development of productive assets, it could contribute to reducing information asymmetries and facilitating dialogue among developers, financiers, auditors, and institutions. That is one of the motivations that runs through the document and explains why it incorporates an empirical validation program designed so that the theory can be examined and discussed by other researchers.

I did not write this theory to close a debate that has been open for centuries. I wrote it because I consider that the present technological transformations justify reformulating some fundamental questions. Economic theories do not endure because of the conviction of those who write them; they endure when others find in them useful tools to better understand reality. It will be time, research, and academic exchange that determine the scope of this proposal.

In the meantime, my aspiration is much simpler and, at the same time, profoundly ambitious: to contribute an idea born in Argentina to the international debate on how value is formed in an increasingly digital, more traceable, and more information-intensive economy.

Because technological innovations change the way we produce and record wealth. But intellectual innovations change the way we understand it. And every new stage of economic thought inevitably begins with a question that still deserves to be explored.