72 ECONOMIC ESSAYS IN HONOR OF JOHN BATES CLARK 
explore the influence of varying the proportions of all the factors 
upon production and consequently upon distribution retarded the 
development of the marginal productivity theory for nearly half 
a century. 
It was the great merit of Professor Clark * to complete the 
work which von Thiinen began. He conceived of varying the 
quantity of each factor while holding the others constant and 
thus altered the amount of labor to a given supply of capital 
and the amount of capital to a given supply of labor, the supply 
of land being eliminated by assuming that this variation in the 
proportion of the factors took place at the margin. He thus 
brought the yield attributable to each factor under the principle 
of diminishing returns and the return to each under that of 
marginal productivity. The addition of successive units of a 
given factor, the supply of all other factors being constant, 
resulted in an increase in the total product but to a lesser 
extent than that resulting from the addition of the previous 
unit of this same factor.” Since all the units of this factor were 
assumed to be uniform and interchangeable, the loss of any one 
would only cause the diminution or increase in the total product 
which resulted from the addition of the last unit. It was this 
amount which was therefore imputed to all of the units of the 
factor in question and which fixed therefore the unit return. 
Varying the quantities of labor in relation to those of capital 
thus gave the marginal productivities of labor and the prevailing 
wage while varying the quantity of capital as compared with that 
of labor established the marginal productivities of capital and the 
rate of interest. It should be emphasized that the theory only 
deals with the expansion or contraction of a unit, or at most of a 
few units, in the supply of a factor. It does not deal with the 
withdrawal of the entire supply of a factor. Failure to under- 
stand this principle of infinitesimal differences has led to ludicrous 
misinterpretations. Thus Mallock has urged that by far the 
major share of the national product should go to management. 
(ability) since if all of this factor were removed, the total product 
Ai 
Er at 
1 The Distribution of Wealth, Essentials of Economic Theory, The Dis- 
tributive Process, The Philosophy of Wealth. 9 
2 Expressed mathematically, the marginal productivity would be oe AX 
where O represents the total product or output and X the quantity of the 
factor.