8 
ECONOMIC ESSAYS IN HONOR OF JOHN BATES CLARK 
have found little in it that bears upon the laws of economic change 
or that enables them to tell which factors move first and which 
come after. Pure economic theory has largely abstracted from 
the element of time and the sequence of events in time, while 
it is precisely this sequence of events with which the business 
forecaster is most immediately concerned. The business fore- 
caster has thus been driven to the study of business history rather 
than theory, and has tried to deduce a certain theory (or a mul- 
tiplicity of theories) of his own from the study of history, 
ignorant of or contemptuous of the static theory. He is 
interested in “dynamics,” not in “statics.” 
Moreover, the business forecaster is increasingly concerning 
himself only with that part of business history which can be 
measured in statistical terms. At the extreme he ignores not only 
economic theory but also the rich body of historical facts which 
cannot be quantitatively stated. His ideal seems to be to develop 
mathematical laws which will tell him not merely which factors 
change first, but also what percentage changes in other factors 
will follow from a given magnitude of change in a particular 
factor, and which ones will come three months later, which ones 
four and a half months later, and which ones four and three- 
fourths months later. | In extreme cases he does not know enough 
of economic theory or of economic history to realize that such an 
undertaking is foredoomed from the beginning, and that if laws 
of this kind could be worked out for a given period in the past, 
there is no guaranty at all that such laws would apply at any time 
in the future! I hasten to add that the extreme case I have 
just been describing is a caricature which does not justly describe 
any living business forecaster. I claim the privilege which the 
static theorist has always claimed of studying tendencies in 
their pure form, even though concrete human nature always 
involves complexities! 
It must be apparent, however, that in ignoring the static con- 
ceptions and the beautifully worked out static doctrines the 
statistical business forecaster is throwing away a most valuable 
aid. Static theory does describe underlying economic forces. If 
it tells nothing about the rate at which they are moving, it does 
at least indicate the directions in which they move, it indicates 
their relative power, and it indicates their relations inter sese. 
The student of change who knows the goal toward which his