THE INCIDENCE OF TAXATION 283

a basis calculated to yield a rent larger in the aggregate than
either a less or greater supply would yield. If that be so,
then ninety per cent. of the rent is also greater for that scale
of supply than that same percentage would be for any other
scale, whether larger or smaller. Consequently, the incidence
of such a tax is on the receivers of rents. The total rent
yielded is unchanged, but the proprietors of rent-yielding
property receive only ninety per cent. of the amount instead
of the whole. They cannot improve their position by modifying
 the total rent-yield, for anything which would add to
it would have been a source of gain independent of the tax,
and cannot, therefore, be brought into existence by the
introduction of the tax. If they adopt changes lowering the
total rent-yield, they will thereby lower their share, viz, ninety
per cent. of that total. Thus the burden of a tax on rent
cannot be shifted. This applies to true rents of all kinds,
whether derived from land-ownership, monopoly rights, or
other sources. It applies in part, too, to quasi-rents, though
the duration of the conditions which give rise to the quasirents
 is modifiable as a result of such taxation of rents.
The taxation of interest stands on a very different footing.
It reduces the yield due to ownership of capital, and thus in-Auences
 the supply of capital. There is reason for believing
that the lowering of the net yield rendered by capital to its
owner would discourage accumulation, and thus reduce the
volume of the supplies of new capital. This reduction of
volume would modify the marginal productivity of capital,
for the application of capital to some of the less productive
purposes would be restrained by the scantier volume of new
supplies. Thus the marginal productivity of capital would
be raised in a way which reduced the total productivity of
industry. This rise of marginal productivity would correspond
 to a higher loan-value of capital, and thus, at any rate
in part, the burden of the tax would be shifted from the
owner of capital to its users. This shifting would, in the
course of time, transfer the burdens to the consumers of the
commodities in the production of which capital is employed,
that is, practically remove the burden of the tax, on the
revenue yielded by capital, to the consumers of goods, It is