THE PROBLEM OF INTEREST 83

disposed of in this fashion. The new investor is, perhaps,
spared the difficulty of gauging entirely unknown risks, by
taking over property the history of which is a guide to the
relation of gross to net return which may be fairly anticipated
from it. A more experienced head, possibly, is given control
of the selection of the investment of the newly-formed
capital. In some degree this exchange tends to put control
of new capital into the hands of the more adventurous
spirits, whose estimate of the risks is likely to fall below the
sound actuarial value of those risks, so that experiments
are tried of more unpromising appearance than would be
tried by more cautious men. How far this is disadvantageous
to the community must depend largely on the balance
between success and failure achieved, for unpromising
ventures are conspicuous successes in some instances as well
as ignominious failures in others.
The supply of capital available for new investment must
now be considered. It is not confined to the new savings of
the community, as appears at first sight, though these are all
that form real additions to the store of capital. The annual
product of the labour and capital and land of the community
affords the source, first, of what is required to make good all
wear and tear of instruments and all material used up; and,
in addition, of what is available either for savings or for
expenditure in ways selected without reference to their
bearing on production. In the first part we must include
what is needed to maintain the supply of human agents of
production as well as of other agents. Perhaps, further,
the making good of wear and tear should be conceived of,
not from the point of view of the least which could be
effective to that end, but rather in relation to what, in the
actual state of things, will actually be required. The second
head covers the saveable surplus, and the actual amount of
saving which takes place will be dependent on the dispositions
 of those who own this surplus, and on the strength of
the inducements to allocate it to the service of present or
future cravings respectively. Of great importance in turning
the scale between future and present, is the gain that may be
expected if consumption is delayed. The satisfaction ex-