Page:The Economic Journal Volume 1.djvu/131

 Rh every agriculturist will rightly charge not the capital nor the labour with the crop, but, simply and solely, the better field, the value of which is raised by just the amount of the surplus. Such a judgment, so far from being illogical, embodies a great practical truth. In imputing the return by this method, I am enabled to find the correct adjustment of the economic measurement, which has to be carried out in the case of the commodities of production. It would, for example, be impossible for me to decide whether to purchase a machine and what price to consent to give for it, if I did not know how to calculate the work it would do for me, i.e., what share in the total return to my undertaking should beimputed to it in particular. Without the art of imputation there would be no business calculations, no economic method, no economy, just as without the system of criminal charge, there could be no society. Fortunately the practice of it is universal, everyone, be he never so stupid and inexperienced, applying it though with varying degrees of acuteness.

These rules of economic imputation as used in practical life the Austrian school has endeavourcd to connect by way of theory. The principle under which it formulates them points back to its general principle for estimating value. If I say 'free commodities have no value for me,' this means that I do not 'charge' them with the utility which they afford. The reason for this is, that I do not feel myself to be dependent upon them; if that supply which happens to be next to hand were for some reason or other to he withdrawn from my possession, I could take any other quantity from the abundance everywhere about me and use it. I impute utility only to those commodities which are not to be had in profusion, and on which I feel myself dependent in consequence, I meanwhile reflecting, that with every portion lost from my possession I lose a definite utility not to be had without it. Now the agriculturist, in losing a cow from his yand, does not forfeit with her the whole return on his farming, but suffers only a certain diminution in it, just as in the opposite event of his introducing some improved machinery he gains a certain increase. In these diminishing and increasing returns, varying with the variations in productive combinations, the principle of imputed returns finds its simplest elucidation, notwithstanding the many difficulties arising by the way. Space fails me to explain my meaning more precisely. I will only specify further, that in the particular instance account must be taken of supply, demand, circumstances of allied products, technical progress, &c., in short of all the well-known conditions, from which experts are able with so much