Valuation, depreciation and the rate base

Bibliographic data

Monograph

Identifikator:: 174667931X

URN:: urn:nbn:de:zbw-retromon-119897

Document type:: Monograph

Author:: Grunsky, Carl Ewald http://d-nb.info/gnd/10180959X

Title:: Valuation, depreciation and the rate base

Edition:: 2. ed., revised and extended

Place of publication:: New York

Publisher:: Wiley

Year of publication:: 1927

Scope:: X, 500 Seiten

Digitisation:: 2021

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Chapter XIV. The standard of value

Collection:: Economics Books

272 VALUATION, DEPRECIATION AND THE RATE-BASE tics compiled by the United States Department of Labor show, for example, that near the peak of the high prices after the war the cost of living was about 125 per cent greater than the average cost of living during the ten years 1goo to 19og, while wages at that time were 109 per cent greater than the wages during the same base period. A comparison of the changes in the cost of living covering the period 18go to 1919 shows the remarkable agreement between the cost of living and the wage scale and shows how quickly a change in the cost of living is followed by a change in wages. (See diagram, Fig. 8.) The main trouble in connec- tion with this matter is the fact that the change is not automatic, that the wage earner usually has to fight for each increase and that the employer throws every difficulty in the way when he finds that an increase of wages is in order. The question naturally presents itself whether means could not be found to eliminate the speculative feature from contracts involving a future transfer of money ownership from one person to another. Is it desirable, or necessary, in other words, to specify the dollar as the unit of value when a deferred payment is involved? The money unit is a definite quantity of some metal such as gold or silver of prescribed fineness. This unit is defined by the government and is commonly, almost universally, ac- cepted as a standard of value. It, however, falls far short of being a satisfactory standard, though admittedly a convenient one. Itisnot,in fact, a standard at all, or at best only a momen- tary standard. It lost, even in our country, as above stated, more than one-half of its value during the five years of the war, and is still now (1926) far below its pre-war value. Value ex- presses the measure of the desirability of anything in comparison with other desirable things, and this value can only be deter- mined and expressed by making such a comparison. Money is desirable because it can be exchanged for other things which are necessary or are desired for human comfort or pleasure. In view of the defects of money as a standard, having value which changes in consequence of currency inflation or depletion, and from other causes, some other less variable standard of value to supplement

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