The nature of capital and income

Bibliographic data

Monograph

Identifikator:: 102659555X

URN:: urn:nbn:de:zbw-retromon-82920

Document type:: Monograph

Author:: Fisher, Irving http://d-nb.info/gnd/118533541

Title:: The nature of capital and income

Place of publication:: New York

Publisher:: The Macmillan Company

Year of publication:: 1923

Scope:: XXI, 427 Seiten

Digitisation:: 2019

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Introduction. Fundamental concepts

Collection:: Economics Books

Sec. 9] PROPERTY 35 owner of land wishes to sell and convey an unencumbered fee simple title, he finds it necessary to extinguish all out- standing leases, or claims for future services, often at con- siderable cost. Recently the New York Reform Club sold its leasehold in a building for $25,000, because the pur- chaser could not afford to wait for the expiration of the lease. The total ownership always includes the ownership of the tenant. In like manner, the total value of any concrete wealth is the total value of the property rights in it. The close correspondence between wealth and property gives us a new method of appraising wealth, namely, by appraising the property rights to it. In fact, we are here provided with another sense of appraisement of wealth, in addition to the several already given in Chapter I. Such appraise- ment may mean, not what the whole article of wealth would sell for en bloc, but the sum of the values of the par- tial rights to it when these latter are appraised on the basis of small individual sales. Thus, the value of a railroad, operating under normal conditions, is found by taking the sum of the values of its stocks and bonds. Railways are seldom sold as a whole, but their stocks and bonds are constantly on the market, and are often the only means of affording a valuation. It is true that under these circumstances the market price of the stock would form no basis for judging what would be the value of the road if sold as a whole. There would need to be added the value of “control.” But this will be accounted for by an addition to the value of such of the shares as will secure this control. “Control” is the power, coming from a majority of votes, to obtain from the road some services which would not be possible without such majority ownership. The additional benefit thus obtained may be illegitimate, as when the parties in control vote themselves large salaries. But whether legitimate or ille- gitimate, the power to make the road better serve one’s

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