DEMAND 
43 
economics is that which is known as the law of 
substitution, indifference, or equi-marginal 
returns. It is simple—so simple, indeed, that 
one might at first feel inclined to refuse it the 
dignified title of “ law ”—but its recognition, 
nevertheless, has led to the most far-reaching 
consequences in economic analysis. In a 
spirit of some exaggeration, one might liken 
its role to that of the law of the survival 
of the fittest in biology—another absurdly 
obvious generalisation. In fact, the two laws 
are not merely alike but akin ; as is apparent 
when we take any example of substitution, 
say, substitution in consumption, which means 
the survival in choice of the things fittest to 
satisfy some direct or indirect demand. It 
frequently happens in science that the pro- 
foundest truths at first strike one as self- 
evident and unimportant. 
The law of substitution, indifference, or 
equi-marginal returns, applies not merely to 
consumption but to every branch of economics. 
For the present, however, I shall define it in 
its application merely to consumption. With 
reference to consumption, the law points out 
that income will be expended in such a way 
that the marginal utilities of different things 
to any person will be made the same, when 
marginal utilities are reckoned with respect