Skc. 2] FOUR INCOME-CAPITAL RATIOS 185
represented by four ratios. As we have seen, both capital
and income may be measured either in quantity or value.
It follows that the relation of income to the capital which
bears it takes four different forms, according as the income
and the capital are measured in one or the other of these
two ways. These four forms of the income-to-capital
ratio follow: —
(1) The ratio of the quantity of services per unit of time
to the quantity of capital which yields those services may
be called the physical productivity of capital. Thus, if 10
acres of land yield, in a certain year, 60 bushels of wheat, the
ratio of income to the capital may be expressed as 6 bushels
per acre per year. This is its physical productivity. In
like manner, if 10 looms will weave 500 yards of cloth in a
day, the ratio of services to the quantity of capital, or the
physical productivity of the looms, is 50 yards per
machine per day.
(2) The ratio of the value of the income from capital to
the quantity of the capital may be called the value produc-
tivity. Thus, if 10 acres of land yield a net return worth
$200 a year, the value productivity is $20 per acre per
year. This is what has ordinarily been called the rent of
land. The same principles apply to the rent of a dwelling
or of any other article of capital. Another example of
value productivity is found in the wages of the laborer.
(3) The ratio of the quantity of services rendered by
capital to the value of the capital may be called its phys-
wal return. Thus, if $100 worth of capital applied to land
in the form, say, of agricultural implements adds to the yield
of the land one bushel, the physical return of this capital is
15 of a bushel per year per dollar invested. Such a con-
cept of physical return is familiar to students of classical
economics under the head of “doses” of capital applied to
land.
(4) The ratio of the value of services to the value of the
capital yielding them may be called the value return. Thus,
