The vocabulary and culture of the valuation

Eccles, Tim (1993) The vocabulary and culture of the valuation. In: European Real Estate Conference: An Agenda for Research; 15 - 16 Jul 1993, Reading, U.K..


The broad theme of the paper is one of concern over the apparently simplistic application of Anglophone valuation techniques into European markets. It will seek to examine this concern, and draw conclusions about its relevance with some suggestions for further research and discussion. The paper has two broad areas of study, those of culture in general, and language in particular. An investigation of the language used within the production of valuations produces an interesting diversity of meanings for the same words from different English sources. This leads to a variety of confusions within published works which too often seem to assume meanings that are far from clear. When these terms are then translated into foreign languages, real problems are encountered. Even when a single English meaning can be agreed upon, there is frequently no direct comparison in European languages [the paper tends to focus on German], which leads to severe problems of application. There seems to be genuine cause for concern in the application of English [British] valuation techniques under these circumstances. Valuation terminology is clearly the product of the 250 years of development of economic thought since Adam Smith. The concepts of value clearly fall within those ideas developed by the neo /classical schools. There is thus a worry over the application of these techniques into economies that are not the product of Smith and his descendants, whose cultures are different. Here rules, norms and social perceptions make English valuation techniques an alien invader of traditional values. The resulting conflict may follow many routes, but is clearly a fundamental problem. Thus, language differences tend to signify major cultural ones that may provide major obstacles to the application of valuation techniques. The paper then attempts to unify these two concerns into a valuation model. It draws from philosophy the notions of the private and public spheres of existence, and uses these to argue that there is a value fraction to all valuations that can only be seen in terms of a personal non-market value. These personal values can be literally personal, or seen as national (cultural) norms on value. Valuation techniques fail to recognise the importance of these non-market values which are the result of utility and pleasure rather than price, cost or profitability. Serious consequences may flow from this inability or oversight. The paper does not present clear-cut answers, but expresses doubts over the universal application across cultural boundaries of valuation techniques, and indeed, both the overwhelming desire and the practical ability to seek such values.

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