Economic essays

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Monograph

Identifikator:: 1753623200

URN:: urn:nbn:de:zbw-retromon-136107

Document type:: Monograph

Title:: Economic essays

Place of publication:: New York

Publisher:: Macmillan

Year of publication:: 1927

Scope:: viii, 368 S.; Ill., graph. Darst.

Digitisation:: 2021

Collection:: Economics Books

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Document type:: Monograph

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Title:: Clark's reformulation of the capital concept / Frank A. Fetter

Collection:: Economics Books

gay CLARK'S REFORMULATION OF THE CAPITAL CONCEPT mt -s (Incomes) when accruing separately throughout th Si the valuation of those same services when discounted and su led up. at an instant of time. Capitalization thus does involve a tome parison of a financial fund (the single present worth) and a flow (a series of future worths) of the very same things, namely, valuations of services. Only through the common element, valua- tion, do capital as a valuation fund and income as a valuation flow become comparable.? The text of Fairchild, Furniss and Buck, eminating from Yale, starts in the old paths, formally defining capital as a third factor of production, produced instruments of production. The tool, the indirect agent, seems to be the typical capital in mind in the historical survey, and the older definitions are repeated.” “Land, labor and capital” are presented in the familiar roles of the three factors of production.® But the first time that there is any real occasion to use the capital concept, a simple footnote makes kindling wood of these museum pieces and the reader is informed that “In the present discussion we shall use the term capital including land as well as man-made instruments. The term is generally so used in discussions of investments.” * Thereafter capital appears as a fund of value, an investment fund, expressed in terms of dollars. Yet from time to time the discarded notion of the difference between land and man-made capital instruments is weakly reéchoed.® The treatment of interest and capital seems pretty nearly in accord with that of Fisher. cats £. CW » 8. Other Representative Opinions Professor Seligman, a colleague of Clark’s at Columbia, took ° an advanced position on the concept of value, as well as on the * The thought is hardly to be avoided that some of the peculiar ideas regarding savings and income to which Fisher has adhered so uniquely despite criticism are traceable to this confusion of definitions. We refer especially to his reiterated proposition that “savings are not income.” As a financial fact, there can be no saving and addition to capital value until there is first a property right to an income calculable in monetary terms (a financial present worth) to be saved. Hence to deny that monetary savings are monetary income is in simple common sense to deny a faut accompli; it is to assume the existence of the effect before its cause. * Elementary Economics (1926), Vol 1, p. 32 ff. ® Idem., p. 40. “ Idem., Vol. 1, p. 355. * Eg. Vol. 2, pp., 163 and 189. ® Principles of Economics (1905), see pp. 17, and ch. xiv, p. 204. on “The Capitalization of Value.”

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