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:: Elasticity of supply as a determinant of distribution / Paul H. Douglas

Collection:: Economics Books

80 ECONOMIC ESSAYS IN HONOR OF JOHN BATES CLARK in wages will stimulate a further flow of such labor and this lessened pressure upon natural resources in the backward areas will give rise to a further increase in population and hence to a filling of the reservoirs upon which the industrialized sections may draw. There are several extraordinary features in such theories as those advanced by Taussig and Kleene. Not the least is the fact that Taussig, who has been such an unsparing critic of the residual theory of wages of General Francis A. Walker should nevertheless have constructed a very similar explanation as his own. Furthermore, the tendency of both to regard the supply of the other factor, in Taussig’s case labor and in Kleene’s case capital, as not being related to the price it receives is crucially defective. Finally, the curious belief of both that the supply curve of a factor does not have any influence on the processes of distribution unless itis virtually paral- lel to the base (i.e., of almost infinite elasticity) and that if there is no such supply curve bar- gaining strength alone determines what the final result will be, is a serious misapprehension of the economic process. The economic process is in fact one in which equilibrium is attained through the interactions of various forces—of supply curves as well as of total and marginal products. As we shall see, supply curves of what- ever description affect the result, and do not by any means need to be of infinite elasticity. \ 1. Various Types of Supply Curves and the Meaning of Elasticity of Supply We shall secure a clearer concept of the influence of the forces of supply if we first examine the various types of supply curves that may conceivably operate and explore the meaning of rela- tive elasticity. An absolutely inelastic supply, which tends to

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