Page:The Economic Journal Volume 1.djvu/140

 120 former case the tendency to maximum utility is, while in the latter case it is not, subject to the condition 'that there should be only one rate of exchange in a market.' With the same request as he then made, that my forced brevity may not be taken for want of courtesy, I remark that in my judgment, of course, not 'one rate of exchange,' but nevertheless 'one rate of value' would still obtain under socialism. If a million tons of grain are lying ready for distribution among the citizens, each ton, assuming it is of equal quality, will have to be held equal in value to any other. In consumption the several tons will not afford equal degrees of utility, but equal utility will be imputed to them as their value. I admit that, when goods are not sold to citizens, but distributed among them, equal prices will not come to be paid for equal items, nevertheless equality in judgments on value would manifest itself in many other directions, chiefly in the calculus of production. Thus, to take as example a simple though comparatively unimportant case, the effective capacity of two machines would be judged by the quantity of products they yielded, in which it would not occur to any one to assume the value of those products, equal quality being assumed, as other than equal. If it were not essentially required in economic procedure, that we should regard a number of commodities, similar in quality but affording different degrees of utility, as economically equal, the fact of their being held as equal in price would be an offence against economic procedure, detrimental to either buyer, or seller, or both. If there were no better explanation of this fact than competition, if its foundation did not lie deep in the nature of each individual economic subject, economy would go astray wherever and whenever it proceeded on the principle of prices reckoned in this manner.

I touch at this point on the difference, alluded to at the outset, which exists between Jevons and the Austrian school respecting the conception of value and the principle of the law of value. For us, Jevons holds too closely to the narrower view, which sees in price the only manifestation of value. We conform to an idea always firmly maintained in Germany, when we say that in economy value decides everything, not only the price of the bargain, but also what amount of consumption, productive employment, and outlay entering into it is permissible. But while the older German school suffers this general function of value to depend ultimately on bare usefulness, to which it gives the empty name of value-in-use (Gebrauchswerth), we explain