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

Structure type:: Chapter

Title:: Alternatives seen as basic economic facts / Franklin H. Giddings

Collection:: Economics Books

TERNATIVES SEEN AS BASIC ECONOMIC FACTS 2) until we get them? We speed up the machines that we now have nd work over-time. In generalized form, then, my proposition is: In any given state of population and the arts, the standard of living remainin onstant or rising, we normally increase stock (surplus goods) nd capitalize it, by speeding up and working over-time. f the proposition holds, a vitally important further proposi ion follows from it. There is a limit beyond which the pro ongation of human labor without rest, a point beyond which increasing intensity of effort, a point beyond which speeding up achinery, are rewarded by diminishing return. This mean increasing unit cost of product. Accordingly, the rate of accumu- ation of stock to capitalize and the rate of capitalization can ormally be increased only at an increasing unit cost. he propositions now arrived at are linked with a fifth basic conomic fact, namely: Pay interest or lose your chance. This is the “now or never” alternative. In the discussion that arose over Béhm-Bawerk’s Positive heory of Capital the distinction was made clear between (a) a incremental product of goods and (b) loan interest or true interest. The one consists of concrete goods in excess of the oods used up as capital goods in producing them. The product ay or may not have a value greater than the value which the concrete capital used up had. That is to say, the increment of rroduct may or may not be an increment of value. Loan interes r true interest is a sum of money or a credit, paid for the emporary possession of a sum of pure capital (money) borrowed, or of credit extended. In terms of value the relation between roducer’s increment and loan or true interest is a fluctuating one, but always there is a relation between the unconsumed ‘stock” of concrete goods and loan interest. By all parties to he long continued controversy over the nature and cause of true interest it has been assumed that pure interest is a difference etween a present and a future value of the same or equivalen oncrete goods. However it may be disguised by the mediation f money or of credit, pure interest is a price paid for the imme- dist delivery of existing goods to be returned, replaced or pai or in the future. This price presumably is quantitatively deter- mined by (1) the demand for immediate delivery, and (2) the upply of immediately deliverable goods. The second condition

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