__NOTOC__
Calculation in kind or calculation in-natura is a way of valuating resources and a system of accounting that uses disaggregated
physical magnitudes as opposed to a common unit of calculation. As the basis for a
socialist
Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the ...
economy, it was proposed to replace
money
Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money ar ...
and financial calculation.
Calculation in kind would value each commodity based on its
utility
As a topic of economics, utility is used to model worth or value. Its usage has evolved significantly over time. The term was introduced initially as a measure of pleasure or happiness as part of the theory of utilitarianism by moral philosoph ...
, for purposes of economic accounting. By contrast, in money-based economies, a commodity's value includes an
exchange value
In political economy and especially Marxian economics, exchange value (German: ''Tauschwert'') refers to one of the four major attributes of a commodity, i.e., an item or service produced for, and sold on the market, the other three attributes b ...
.
Calculation in kind would quantify the utility of an object ''directly'' without recourse to a general unit of calculation. This differs from other proposed methods of socialist calculation, such as Taylor-Lange accounting prices, and the use of labor time as a measure of cost.
Calculation in kind was strongly advocated by the
positivist philosopher and political economist
Otto Neurath
Otto Karl Wilhelm Neurath (; 10 December 1882 – 22 December 1945) was an Austrian-born philosopher of science, sociologist, and political economist. He was also the inventor of the ISOTYPE method of pictorial statistics and an innovator in mu ...
when employed by the
Bavarian Soviet Republic
The Bavarian Soviet Republic, or Munich Soviet Republic (german: Räterepublik Baiern, Münchner Räterepublik),Hollander, Neil (2013) ''Elusive Dove: The Search for Peace During Wo