CONTENTS

wi

PAGES
dependent on the anticipated net yield. Purchase of old capital does
not dispose of the problem of giving concrete form to new savings.
Net revenue the limit to additions to aggregate of capital. The
comparison of present and future needs. Some savings have a very
small supply-price. Saving has increased due to more vivid realisation
of future needs, increase in security and in productivity of industry.
New saving not the whole of the supply of fluid capital, and the field of
investment not limited to new enterprises. Invested capital valued on
basis of earning power. To become productive, capital value must be
embodied in capital goods. Money as capital in mercantile operations.
Interest the price of the control of capital, Natural forces only
available through the employment of capital to aid labour. Roundabout
 methods productive because utilising natural powers. Relation
of productivity of capital to its supply. Capital synchronises effort
and product, Temporary and permanent investments. Gross interest
and net interest. Local abundance and scarcity of capital. Borrowings
for non-productive uses. Review of causes of fall in rate of interest.
The supply of and the demand for capital viewed more broadly.
Interest expresses marginal productivity of capital. Has saving
become excessive? Apparent pause in downward course of rate of
Interest + 70-06

CHAPTER VII

THE PROBLEM OF RENT: THE SHARE OF LAND IN
DISTRIRUTION

AUTHORITIES
WALKER . . ‘Land and its Rent.”
J. S. MiLL . Principles of Political Economy,” Book IL. Chapter
XVI. and Book III. Chapter V.
MARSHALL . ‘Principles of Economics,” Book V. Chapters VIII.
IX. XX. and Back VI. Chapters IX. X.

The supply of land not affected by the relation of its yield to its value.
Different soils give different returns to labour, and the proportion of
return to labour expended differs with the intensiveness of cultivation.
Diminishing returns a reality. The most productive known methods
not always attainable in practice. The limit of what a tenant can
afford to pay for the hire of land. The maximum excess of return over
outlay contemplated. Marginal expenses of cultivation equalled by
value of marginal product. Hire of labour and sale of products here
assumed. Contract rent differs from rent yielding power of land,
owing to circumstances which shut out competition. Different soils
not cultivated with equal skill. Rent expresses the superior productivity
 of good soils, Intensive and extensive cultivation alike
involve diminishing returns. Rent of building sites. Capital invested