**Money Is Not Wealth** is my favourite section in any Paul Graham essay: [How to Make Wealth](https://paulgraham.com/wealth.html) After I read this, I kept thinking about the essence of value creation. Ultimately, I realized that value creation boils down to world alignment. An agent has a utility function which determines how suitable a given world is for that agent. Paul uses the example of restoring an old car as a way to "create wealth". This feels somewhat abstract--it doesn't feel like any act of creation has taken place. I think a simpler way to frame this is that by restoring the car, you have made the world slightly more aligned to human values (since humans find new cars more useful than old cars). Most acts of "value creation" can be described as a conversion of base resources into configurations which are more useful for humans. Take something like sand--through much labour and innovation, humans have been able to transform it into a variety of useful products, like smartphones and GPUs. For software engineers, this mostly looks like converting brain cycles and time into software. "They literally think the product, one line at a time." For writers, they produce an artifact which can travel across space and time to alter the cognition of the reader, calibrating their brain to have a better model of reality. One useful consequence of viewing value creation this way is a clearer understanding of how wealth has increased over the course of human history. From a human perspective, the world is more habitable and aligned with our happiness. Though for another animal like a lion, it may find the “wealth” of the world has actually decreased — i.e. it is now less habitable and less aligned with its happiness. 2000 years ago, the world was much less aligned to human happiness. For one thing, there were simply a lot less people around. Humans are the source of a lot of happiness (and suffering) for other humans. Having more humans on Earth means human wants and needs get more attention. More human art is made and more human stories get told. --- **Money Is Not Wealth** is my favourite section in any Paul Graham essay: [How to Make Wealth](https://paulgraham.com/wealth.html) After I read this, I kept thinking about the essence of value creation. I realized that value creation boils down to world alignment. An agent has a utility function which determines how suitable a given world is for that agent. Paul uses restoring an old car as a way to "create wealth." This feels abstract—no act of creation has taken place. A simpler way to frame this is that restoring the car makes the world more aligned to human values since humans find new cars more useful than old cars. Most "value creation" acts convert base resources into more useful configurations for humans. For example, through labor and innovation, humans have transformed sand into useful products like smartphones and GPUs. For software engineers, this means converting mental effort and time into software. "They literally think the product, one line at a time." Writers create an artifact that can travel across space and time to alter the reader’s cognition, adjusting their brain to have a better reality model. Viewing value creation this way clarifies how wealth has increased throughout human history. From a human perspective, the world is more habitable and aligned with our happiness. However, for a lion, the world’s “wealth” has decreased — it is now less habitable and less aligned with its happiness. 2000 years ago, the world was less aligned to human happiness. There were fewer people. Humans are the source of a lot of happiness (and suffering) for other humans. More humans means more attention to human wants and needs, more human art, and more human stories.