102 NATURE OF CAPITAL AND INCOME [CHar. VII
in an obscure and ambiguous phraseology.! Were it not
for an instinctive feeling that there exists a definite income-
concept, the repeated failure to formulate it might lead one
to conclude that it is not susceptible of any exact and rig-
orous definition, and that the best course is to abandon its
search as futile. Kleinwiichter, who wrote a book espe-
cially devoted to this subject, specifically takes this course.
He states that there is no useful concept of income.?
His idea is that, originally, merchants attempted to keep a
record of their transactions by counting the money which
they received and disbursed, and that, in consequence of
this, arose the “illusory” notion that through some such
record the complete economic standing of an individual or
firm could be expressed. He observes, that such a com-
plete picture could not be obtained by recording merely
the incomings and outgoings of money, but should
include likewise the incomings and outgoings of every other
kind of wealth? A complete record, he states, would
alone cover the required ground. So-called statistics of in-
come are, he maintains, merely a makeshift for sucha record. *
But why should the possibility of a coneept of income
be rejected because it does not reveal a « complete” picture
of an individuals economic condition? On the same plea
we might also reject the possibility of a concept of capital.
! E.g. F. Y. Edgeworth, Palgrave’s Dictionary of Political Econom Y,
article, “Income,” Vol. II, p. 374: —
“Income may be defined as the wealth, measured in money, which
is at the disposal of an individual, or a community, per year or other
unit of time.” (The italics are the present writer’s.) This formula-
tion is adopted by N. G. Pierson, Principles of Economics, London
(Macmillan), 1902, p. 76. ;
? Das Einkommen und seine Verteilung, Leipzig, 1896, p- 11,
30p. vit., p. 14.
* The present writer at one time also expressed these doubts
(Economic Journal, December, 1896, pp. 553, 554). By aid of the
criticisms of Cannan and Edgeworth, the conclusions here stated were
reached. These were first outlined in “Senses of Capital,” Economic
Journal, June, 1897, and in “The Réle of Capital in Economic
Theory,” Economic Journal, December, 1897.
