While Rand did not recognize subjective value, she distinguished between "philosophically objective" and "socially objective" value in Capitalism: The Unknown Ideal (New York: New American Library, 1967), 24-5 (more information). The "socially objective" value of a good, represented by its free-market price, is "the sum of the individual judgments of all the men involved in trade at a given time." Clearly, this concept, identified in this course as "market value," derives from a more fundamental concept, namely, the value attached by a single individual to a good. Values of this latter kind, here called "subjective value," are measured on an ordinal scale and are therefore not directly susceptible to operations such as addition, as Rand implies. On the other hand, Section 4 will show how they give rise to individual supply and demand schedules, which can indeed be summed across all traders in a market.

The term "subjective value," which is commonly accepted among economists, is appropriate because the concept pertains to the state of mind of the valuing individual, rather than to the objective relationship between a good and the individual's needs. Both "objective value" and "subjective value," it must be emphasized, refer to objective concepts, derived from proper integrations of our observations of human action. Objectivist epistemology does not, of course, require that we assume that humans always think objectively or that they never act based on subjective viewpoints that may conflict with reason.