ECONOMIC PRINCIPLES
which classed as necessaries those goods, the result of an
increased cost of which was a decreased expenditure on
other goods. Whether the resources at the disposal of
given classes or communities will suffice to maintain a high
order of physical and mental vigour or not, is only in part
dependent on the extent of those resources. It turns also
on the extent and nature of the conventional necessaries to
the provision of which a part of the available resources will
be devoted,
Just as the well-being of individuals is apt to suffer
{rom the neglect of what are sometimes referred to as real
necessaries, so may the welfare of a community suffer from
the devotion of an inadequate proportion of its resources to
the provision of food, shelter, and necessary clothing. Unless
luxurious waste be an indication of superabundant resources,
it must denote a want of balance in the various purposes to
which the available resources are applied.
In economic discussion, no word is more frequently
employed, no conception more essential, than that of value.
As used in ordinary discussion, value denotes either of two
different ideas. In one use it denotes the importance of
goods of a given description to the user of them. As we
shall see, this value-in-use, or utility, is not an unchanging
characteristic of goods, or even a uniform result of the relation
of goods to human wants,
The second use of the term value is to denote the power
to procure other things in exchange, which useful goods have
when they are not available in unlimited supply. Thus, the
possession of a sack of flour may be important from either,
or both, of the two points of view. To one person the
importance of the possession of the flour may lie in the
assurance thus afforded of a supply of food for himself, and
for any dependent on him. To another, its importance is
derived from the fact that it can be sold, and, from the
proceeds, a variety of useful or agreeable things be purchased.
In the one case it is a direct utility which is the measure of
the estimation in which the goods are held. In the other, it
is an indirect utility, or group of utilities, afforded by what is
obtained in exchange for the goods.

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