Page:The Economic Journal Volume 1.djvu/132

 112 success to infer what importance to attach now to this, now to that, element in production.

The most momentous consequence of the theory of imputation is, I take it, that it is false, with the Socialists, to impute to labour alone the entire productive return. Land and Capital as well must find recognition as collaborating factors in production, from the point of view of practical economy; excepting the case of their being available in superabundant quantities, which, however, can only be true of Land. The fact of fertility alone does not constitute an adequate condition for imputing rent to land, any more than utility as such makes a commodity valuable. Productive imputation requires the conjunction of utility and scarcity. But in the case of land, if scarcity be assumed, the charge of rent arises, whatever the form of land-tenure, and whether the produce is sold in the market or not. Even in a socialistic state a surplus reaped from better soil must be taken into account as soon as inferior soils are cultivated; the occupier farming the better land will be made responsible for a larger yield in view of the nature of the soil.

A further complication of value is afforded by the cost of production. Experience shows, that in very many cases the value of products is less than equivalent to the utility they bestow, because it is adjusted to the measure of the expense required for their production. Hence a great many theorists have concluded that value is not derived from utility, but is governed by another principle, viz., cost of production. But what is the cost, and how is it measured? The readiest way of expressing in figures the expenditure of materials and labour required to produce any article is to give the supplies to be consumed, the number of working days, the number of tons of coal, the time during which machinery is at work, the figure of each of the infinite number of items used in the production, and so on. This runs up a long list, but the items are incapable of being added up; these magnitudes are as mere bulk incomparable, incommensurable, and cannot be concentrated in one term. To sum them, every item must be put down in terms of value—but how is this to be determined? We can tell at once. The value of the productive elements is determined on the ground of utility as afforded by the products, and this holds good of the labour no less than of the coals, the machinery, and all the other means of production. To insist then on cost of production is ultimately to insist on some utility. There is no new principle to be discovered, none save utility.

Estimation of cost shows us in each particular case what