CAPITAL AND INTEREST 
A SER 
eT ita bo JE 
67 
cation. Only so far as there is a peculiarity in the position of a 
particular laboring group; or so far as a commodity is produced in 
one country with a different labor group or assortment of groups 
from that which is utilized in another — so far only does this 
factor exert a modifying influence of its own. The investment 
of capital and the payment of interest on capital are to be regarded 
in the same way. No essential modification of the original 
analysis is called for, unless this factor in turn leads to price 
phenomena which are different for one commodity in a given 
country from those for the same commodity in another country. 
A higher or lower rate of interest, so far as it operates on a par- 
ticular commodity with greater effect in country A than in country 
B, has its influence in causing the price of that commodity to be 
different, relatively to other commodities, within the country; 
and thereby only does it have an influence of its own on inter- 
national trade. 
The quantitative importance of the capital charge factor in in- 
ternational trade is probably not great. As the whole tenor of 
the preceding exposition indicates, the range of its influence is 
restricted to a special set of circumstances. Within that range, 
its influence is further limited by the absence of wide inequalities 
in the rate of return on capital. Interest, while it does vary some- 
what from country to country, does not vary widely between the 
leading countries of western civilization; and it is in the trade 
between these, and in the competition between them for trade 
with other countries, that the interest factor is most likely to enter 
with its independent and special effects. 
The analogy to non-competing groups and laborers may again 
be applied. Capital may be regarded, if one pleases — of that I 
shall say a word presently — as an independent factor, competing 
with labor so far as concerns contribution to the output. But it 
does not compete with labor in the sense that there can be any 
equalization of sacrifice between capital and labor ; the two sacrifices 
(“abstinence” and work) being in their nature incommensurable.! 
Marked differences in the rate of return on capital, persisting 
! As was long ago remarked by Cairnes, Leading Principles, Part 2, Ch. 5, § 3.