The Principles of Economics, with Applications to Practical Problems

5. If you had the power, what single public measure that you believe would be practicable and effective would you put on the statute books, in order to make a juster division of...

1. _From the twelfth to the sixteenth centuries the sale and purchase of rent-charges was the most general form of borrowing and lending wealth._ A rent-charge in the Middle Age...

1. _A protective tariff is a schedule of import duties so arranged as to give appreciably more favorable conditions to some domestic industries than they would enjoy with free t...

1. _Money we have defined as a material means of payment and medium of exchange, generally accepted and passing from hand to hand._ The origin and function of money were set for...

1. _A trade-union is an association of wage-workers for purposes of mutual information, mutual help, and for the raising of wages._ The term trade-union is used in a general sen...

1. _Many forms of chance are inseparable from the individual enterprise._ There are what may be called natural chances chances, arising from the uncertainties of the seasons, fr...

1. _Time-value is the difference between the values of things at different times._ Things differ in value according to form, place, quality of goods, and according to the feelin...

1. _The supply of labor means here not the number of workers available in any one industry, but the number available in the whole field of industry._ The individual employer thi...

1. _The law of wages must be considered in connection with other far-reaching influences._ One may use the sentence, "the marginal productivity of labor determines wages," witho...

1. _The phrase "diminishing returns of industrial agents" is the expression of the fact that there is an elastic limit to the utility any indirect good can afford within a given...

1. _Property rights must meet the test of social expediency._ If private property is defended on the ground of social expediency, it must show good social results. It is not a s...

1. _Labor is any human effort having an aim or purpose outside of itself._ It is difficult to define satisfactorily the term labor. No definition will quite mark off all the cas...

1. _In the case of consumption goods, present marginal uses are often less than future uses as judged at the present._ The proposition that future goods sometimes have a greater...

1. _In the discussion of the so-called trust problem three things must be distinguished: large individual capital, large production, and monopoly power._ Capital, in the sense o...

1. _Under the title "the social aspects of value" are to be considered the influences exerted upon incomes by various social acts, ideals, and institutions._ The incomes from th...

1. _International trade is exchange between individual men, and has the same object as other exchange of goods._ The term international trade should not be misunderstood as mean...

1. _The exchange of goods by barter is extremely difficult in most cases._ Thus far we have not considered the subject of money and have so far as possible avoided even the use...

1. _The accidental destruction of wealth is a loss to the owner, rarely with benefit, on the whole, to others._ In the consumption of wealth the loss of its utility is accompani...

1. _In a broad sense, a crisis is a decisive moment or turning point; hence, in industry, a collapse of prosperity._ In the course of a fever the crisis is the point where there...

1. _The great increase of late in the number of industries under corporate control has brought new problems of social regulation._ Inventions, machinery, better transportation,...

1. _Local political units generally acquire only industries whose products must be used in the place where produced._ The word industry is used here in a broad sense, including...

1. _The use of money prevails in very different degrees in various parts of the United States._ The members of this class, representing nearly every state and territory in the U...

1. _Interest, the amount paid according to contract by one person to another for credit given in terms of money, is but one expression of a larger problem, that of the differenc...

1. _The meaning and scope of economics can be better seen at the end than at the beginning of its study._ The proposition with which this inquiry opened may well be recalled in...

1. _The economist's task, strictly confined, is to explain the relation of trusts to prices, not to solve the problem of their political control._ The question of trusts is such...

1. _The term profit is popularly used as any gain or advantage secured by any means in business._ The terms used in economics, being taken from popular language, vary in meaning...

1. _Railroads enjoy peculiar public privileges through their charters, franchises, and the right of eminent domain._ Railroads in our country are owned by private corporations a...

1. _Economic consumption is the enjoyment of the utilities which wealth is capable of affording._ All wealth looks toward consumption. To take away the prospect of the enjoyment...

1. _Personal distribution, in economics, is the reasoned explanation of the ways in which income is divided among the members of the community._ Before noting more exactly the w...

1. _Wage in the broad sense is the income due to labor, in distinction from that due to the control of material agents._ The uses of material agents, studied under the subject o...

1. _The beginning and end of economic study is man._ Before leaving the more theoretical and abstracter part of the theory of value, it may be well, at the cost of some repetiti...

1. _Under modern conditions many laws restricting free competition are required to secure the health and convenience of the citizens._ The rapid growth of city populations has b...

1. _When the number of coins issued is limited properly, a seigniorage charge does not reduce their money value; they are worth more as money than as bullion._ The coinage thus...

1. _The term monopoly is used loosely and in many senses._ In popular discussion monopoly means almost any wealthy corporation or the power the corporation possesses, a power wh...

1. _The wage system is the organization of industry wherein some men, owning and directing capital, buy at their competitive value the services of men without capital._ The wage...

1. _The standard of deferred payments is the thing of value in which, by the law or by contract, the amount of a debt is expressed._ A credit transaction is a lengthened exchang...

1. _The continued rent of indirect agents is dependent on the continual repair of certain parts necessary for their efficiency._ All earthly things wear out or decay. Whenever m...

1. _Profit-sharing is rewarding labor with a share of the profits in addition to contract wages._ The essential mark of profit-sharing is that the additional payment depends on...

1. _A machine is a mechanical device by which power is applied in an automatically repeated manner, to change the place or form of things._ It is not easy, perhaps not important...

1. _A bank is a business whose income is derived chiefly from lending its promises to pay._ Banks have passed through many changes in the past three centuries. Originating on th...

1. _Provision for the expense of organized government is the fundamental purpose of taxation._ Taxation may be defined as the taking by the government of private property for pu...

1. _Transportation of goods and men is one of the most important modes of production._ When utility was thought of as inherent in things rather than as resulting from a relation...

1. _Exchange in the usual economic sense is the transfer of two goods by two owners, each of whom deems the good taken more than a value-equivalent for the one given._ The compa...

1. _As wants differ in kind and degree, so goods differ in their power to gratify wants._ This general and simple statement unites the leading thoughts of the two chapters prece...

1. _The temporary use of materials and power and their sources is necessary to bring most enjoyable goods into being._ Indirect goods have value solely because they help to get...

1. _Economic freedom exists when men's goods or their own services may be exchanged as they choose, without hindrance._ Competition is but another expression for economic freedo...

1. _The task of the enterpriser is to get together the essential factors to secure valuable products._ The enterpriser must first decide what product he will endeavor to secure,...

1. _In the simplest kinds of individual production the value of the results depends largely on intelligent choice._ Even for the solitary worker the choice of the right time to...

1. _The aim of industrial effort is the increase of the quantity and quality of scarce goods; this is economic production._ The thought has become familiar to the student that t...

1. _While man destroys some agents of production he multiplies many others._ We have noted many kinds of depreciation, destruction, and wearing out of wealth; but the normal thi...

1. _Both rent and the value of durable wealth are based on the value of the fruits or products yielded by the wealth._ Gratification, afforded directly or indirectly, is the bas...

1. _Satisfaction and gratification being only temporary conditions, economic wants appear in more or less regularly recurring series._ Impressions are short lived, sensations ar...

1. _Men seek to increase income by increasing capital._ Men may strive to increase their rents without expressing the rent-bearer in terms of capital. Peasant owners and small p...

1. _Goods may be ranked according to their technical relation to wants._ The technical rank of goods (sometimes spoken of as the degree of roundaboutness of the process) signifi...

1. _Economics, or political economy, may be defined, briefly, as the study of men earning a living; or, more fully, as the study of the material world and of the activities and...

1. _The gratifying of economic wants depends on things outside of the man who feels the wants._ Man is to himself the center of the world. He groups things and estimates things...

1. _A logical explanation of industry must begin with a discussion of the nature of wants, for the purpose of industry is to gratify wants._ An economic want may be defined as a...

1. _The efficiency of labor, in its broadest sense, is its ability to render services or produce things that minister to welfare._ The efficiency of labor is a resultant of many...

Democracy makes for the efficiency of American industry not less than do the great natural resources. If America is to surpass the world in all the great industrial lines, it wi...

This book had its beginning ten years ago in a series of brief discussions supplementing a text used in the class-room. Their purpose was to amend certain theoretical views even...

11 REPAIR, DEPRECIATION, AND DESTRUCTION OF WEALTH: RELATION TO ITS SALE AND RENT: REPAIR OF RENT-BEARING AGENTS; DEPRECIATION IN RENT-EARNING POWER OF AGENTS KEPT IN REPAIR; DE...

NOTE.--The broad reading here given to the law of diminishing returns is so recent that even the latest texts have recognized it only in a partial manner, defining "the law" in...

16. Discuss the following statement: Under the piece-work system the foreman looks out for the quality and the operative for the quantity of the work; under the time-wage system...

NOTE.--We are indebted to the economic historians for a better understanding of the important influence money has had on economic organization. See Hildebrand's notable article...

NOTE.--Although most texts still present the older, narrow conception of land rent, its defects have been revealed by many critics. J. B. Clark has been the chief champion of th...

NOTE.--The theory of marginal utility broadly outlined in chapters 3-5 has been worked out in detail by the group of writers called the Austrian economists. The mechanism, or th...

8. A woman cut the wool from a sheep's back, spun and wove it by old hand-methods, and within twenty-four hours wore the dress made of it. Is more or less time needed in product...

8. The mint price of an ounce of gold, .900 fine, is alike at San Francisco and Philadelphia, $18.604. Why is gold ever shipped from California to New York?

NOTE.--In an interesting article on "Prestige Value," by L. M. Keasbey, in _Quarterly Journal of Economics_, May, 1903, has been developed one phase of the thought in Sec. II, p...

NOTE.--The subject of population generally is discussed under the name of "The Malthusian Doctrine" and much space is given to it in the texts. So much useless controversy has b...

1. Some money-lenders in cities get 10% a day from fruit-vendors for the advance of small sums of money, and the losses are very slight. Pawnbroking pays frequently 25 to 100% p...

1. Mention any cases you can think of where merely changing the place of things added to their value; or changing their form; or where the mere lapse of time added to the value...

NOTE.--Of the very large recent literature bearing on monopoly and trusts may be mentioned as especially useful: J. B. Clark, _Control of Trusts_; R. T. Ely, _Monopolies and Tru...

2. Is it production to buy fifty cents' worth of yarn and knit a pair of socks worth twenty-five cents if you enjoy doing it? If you do not enjoy it?

5. A tunnel was made to drain a mine; the stock doubled in price. Was it really the stock, the old mine, or the new hole in the mountain-side that had increased in value?

1. Does it make any difference in the permanence of an increase of wages brought about by a strike, whether the employer is one of the more successful or one of the less success...

3. It is usual to call the use of a house for business purposes a productive use, but its use as a residence an unproductive one. What reasons are there for and against this?

8. Since under the piece-work system a man is paid only for what he does, is there any reason for discharging a workman employed under this plan whose efficiency falls below the...

NOTE.--Various writers have recognized that social, class distinctions had an influence on the conceptions of rent and capital in England in the eighteenth century; see Fetter,...

4. Can a manufacturer pay the same to laborers if the product will be marketed next year, as he can if it is to be marketed to-morrow? If so, how is the value of the labor adjus...

6. A rare coin and a piece of land sold for the same price one year, and the next year both sold for double the amount. Was there an unearned increment in both cases, and of the...

5. A nation with _n_ dollars in circulation has to pay a war indemnity of _n_ dollars to another country having the same circulation, how much money will each then have, and wha...

NOTE.--For a fuller treatment of the more recent view of the subject, see Smart, pp. 64-83; Wieser, _Natural Value_, pp. 171-214; Böhm-Bawerk, _Positive Theory of Capital_, pp....

NOTE.--The ablest study of the subject is by H. C. Emery, _Speculation on the Stock and Produce Exchanges of the United States_, in Columbia University Studies in History, Econo...

NOTE.--For exhaustive and well-arranged references on all aspects of municipal control and municipal ownership see R. C. Brooks, _Bibliography of Municipal Problems_, pp. 157-16...

2. If a $100 share of railroad stock sells at par when interest on loans is at 5%, what will be its price when interest rises to 6%? When interest falls to 4%?

4. A recent newspaper item says: "This is the year real estate is assessed. Turn the cow loose in the front yard, tear down the fence, make things look generally dilapidated, fo...

4. What kinds of laborers were thrown out of employment by the invention of the type-writer? What kinds of labor found employment as a result of its invention? Was the net resul...

1. Give reasons for attributing exchange value to the waves of the ocean; to a waterfall, a water-wheel, a loom, a piece of cloth, a dress made of the cloth.

NOTE.--A meritorious though fragmentary essay to rethink the old conception of natural resources and to express them in new terms, is _Natural Economy_, by A. H. Gibson, 1901, r...

4. Would it be a good thing for society if a trust made great economies in production, crowded out its smaller competitors, and maintained prices just where they were before, di...

7. If there are twenty banks in a town and no clearing-house, how many collections would have to be made by all the banks daily assuming that each day depositors of each bank re...

3. The government of the island of Guernsey having no money, issued paper-notes to pay for the building of a market. They circulated and were gradually taken up as the market ea...