210 
POLITICAL ECONOMY 
we know, from wliat we have learnt of the law 
of decreasing returns, that sooner or later 
the addition made to the returns obtained from 
a field by adding to the doses of labour and 
capital devoted to its cultivation will become 
less and less. This being so, it is apparent 
that in the disposal of labour and capital 
the farmer will devote so much to each kind 
of land that the additions made to the returns 
of each kind of land, as a result of the appli 
cation of the last dose of labour and capital, 
will be the same. In saying this we are 
merely saying that the law of substitution, 
indifference or equi-marginal returns, holds 
in production. The proof is identical with 
the proof already furnished of the proposition 
that people will tend so to spend their incomes 
that the marginal utilities derived from differ 
ent lines of expenditure will be equal. The 
additions made to the returns of the fields 
are known technically as the marginal returns, 
as the reader knows. 
Continuing our argument, we observe next 
that each farmer will go on applying doses 
of labour and capital to each tract of land 
each season until the marginal return, in 
view of the price of the produce, is just 
sufficient to afford normal remuneration for 
a dose of labour and capital. Normal pay-