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 original meaning by innumerable distinctions “over-curious and precise.” In the same way the doctrines of the classical economists may be adapted by interpretation clauses and qualifications the exact force of which cannot be tested or explained, so that we do not know whether the original proposition is to be considered substantially correct or not. The result will be that while the doctrines are apparently being brought into closer correspondence with the facts of life, they will in reality be made quite useless for practical purposes or economic investigation. It is easier to point out the danger than to suggest how it should be met. The position we have described is no doubt partly due to the unsettlement of economic opinion and the hostile criticism of old-established doctrines which has characterized the last generation. Or it may be the result of economic agnosticism, combined with unwillingness to cut adrift from old moorings. Whatever the cause, the complete restatement of economic theory, which some heroic persons demand, is clearly impossible, except on conditions not likely to be realized in the immediate future. The span of life is limited; the work requires an extensive knowledge of the economic literature of several countries and the general features of all the important departments of modern economic activity. In general theory special studies by other men cannot play the same part as they do in historical and statistical work. In historical and statistical investigation, or in special studies of particular subjects, it is possible, given the pecuniary means, to organize a whole army of skilled assistants, and with ordinary care to combine the results of their separate efforts. In general theory the inverse rule seems to prevail. There the unity of conception and aim, the firm grip of all the different lines of argument and their relation to each other, which are required, can only be given by a single brain. But no one individual can do original work over the whole field. He is lucky if he can throw new light on a few old propositions. For the rest, he can only, with the utmost caution, adopt the suggestions of other minds as qualifications of old doctrines, never feeling quite sure that he is right in doing so. A complete restatement could only be undertaken by a group of men, trained in much the same conditions, accustomed to think and work together, each one engaged on a special department, but all acting under the control of one master-mind. This is largely a question of the organization of economic studies, and it is of the greatest importance that, if possible, such an effort should be made to present in a connected form the best results of modern criticism and analysis.

Economics is unlike many other sciences in the fact that its claim to recognition must be based upon its practical utility, on its relevance to the actual life of the economic world, on its ability to unravel the social and economic difficulties of each generation, and to contribute to the progress of nations. The very effectiveness of modern criticism and analysis, which has brought great gains in almost all branches of economic theory, has made the science more difficult as a subject of ordinary study. The extensions, the changes or the qualifications, of old doctrines, which at any rate in the works of responsible writers are rarely made without good if not always sufficient reason, have modified very considerably the whole science, and weakened the confidence of ordinary educated men in its conclusions. In the case of many subjects this would matter very little, but in that of economics, which touches the ordinary life of the community at so many points, it is of great importance, especially at a time like the present, when economic questions determine the policy of great nations. The “economic man” of the earlier writers, with his aversion from labour and his desire of the present enjoyment of costly indulgences, has been abandoned by their successors, with the result that in the opinion of many good people altruistic sentiment may be allowed to run wild over the whole domain of economics. The “economic man” has, on the other hand, been succeeded by another creation almost as monstrous, if his lineaments are to be supposed to be those of the ordinary individual—a man, that is, who regulates his life in accordance with Gossen’s Law of Satiety, and whose main passion is to discover a money measure of his motives. It is extremely important to consider how far the economic conceptions based upon this view of the action of men in the ordinary business of life—such, for example, as the doctrine of marginal utility—depend for their truth and relevance on the fact that in economics we are dealing with large aggregates. The earlier writers generally assumed perfect mobility of labour and capital. No economist would deliberately make that assumption now unless he were dealing with some purely theoretical problem, for the solution of which it was legitimate at some stage in the reasoning. Many of the questions of the greatest practical importance at the present time, such as the competition between old and new methods of manufacturing commodities substantially the same in kind, and equally useful to the great body of consumers, arise largely from the immobility of capital or labour, or both of them. But it is obvious that if the assumption of perfect mobility is invalid, there is scarcely any economic doctrine identified with the earlier writers which may not require modification, in what degree it is impossible to say without very careful investigation. Much suggestive work on this subject of a general character is incorporated in economic books of the present day, but there is room for a whole series of careful monographs on a question of such fundamental importance. The same may be said of another subject, too frequently neglected by earlier writers, to which due significance has been given in the best recent work, namely, time in relation to value. It would perhaps be too much to say that the full consideration of this point has revolutionized the theory of value, but it has certainly created what seems almost a new science in close contact with the actual life of the modern world.

Some doctrines of the earlier economists, such as the Wages Fund Theory, are now practically abandoned, though it may be said that they contained a certain amount of truth. Others, which were considered of fundamental importance, owe their position in modern economics and the form in which they are stated to the “tradition of the elders.” If they could, by some happy chance, have been left for discovery by modern economists, they would without doubt have received different treatment, to the great advantage of economic science. Such a doctrine is the so-called Law of Diminishing Returns, which Mill considered “the most important proposition in Political Economy.” “Unless this one matter,” he says, “be thoroughly understood, it is to no purpose proceeding any further in our inquiry.” “Were the law different, nearly all the phenomena of the production and distribution of wealth would be other than they are.” On the other hand, Thorold Rogers, not to speak of earlier objectors, described the law as a “dismal and absurd theorem.” The opinions of present-day economists appear to fluctuate between these two extremes. The law may apparently be “a general rule” or “a tendency” which is liable to be “checked,” or a particular case of the law of the conservation of energy. If we go to Mill to discover what it is, we find that “it is not pretended that the law of diminishing return was operative from the beginning of society; and though some political economists may have believed it to come into operation earlier than it does, it begins quite early enough to support the conclusions they founded on it.” “It comes into operation at a certain and not very advanced stage in the progress of agriculture.” But this very important stage in the history of a nation is not defined or clearly illustrated. We are told that we can see “the law at work underneath the more superficial agencies on which attention fixes itself”; it “undergoes temporary suspension,” which may last indefinitely; and “there is another agency, in habitual antagonism” to it, namely, “the progress of civilization,” which may include every kind of human improvement. Mill apparently is not content with the confusion between “law” and “agency” or “force,” but opposes the one to the other. He is constantly speaking in terms which imply the conquering of one law by another, a habit from which his successors have not freed themselves; and the theory of natural processes which appears to have satisfied him, was that when two forces come into operation there is a partial or complete suspension of one by the