146

POLITICAL  ECONOMY

want  to  make  outstanding  in  the  present
chapter  ;  and  there  is  involved  in  it  the
further  idea  that  in  the  form  which  the
theory  of  value  assumes  in  the  theory  of
international  trade  marginal  incidents  play
parts  as  pre-eminent  as  those  assigned  to
them  in  the  economic  scenes  which  we  have
already  contemplated.  At  the  same  time,  of
course,  I  shall  have  to  make  perfectly  plain
the  salient  points  in  the  doctrine  of  comparative ­
  costs.
The  best  way  to  realise  the  relation  of  part
and  whole  which  subsists  between  the  two
theories  referred  to,  and  at  the  same  time
to  get  an  understanding  of  the  principles
of  foreign  trade,  is  to  begin  by  dissecting  the
more  complex  of  the  two  theories,  that  is
the  theory  of  home  price.  The  theory  of
home  price  may  be  helpfully  regarded  as
consisting  of  two  parts,  first,  of  a  pure  theory
of  exchange,  or  theory  of  barter,  as  it  is
sometimes  called,  and,  secondly,  of  a  theory
of  the  reactions  which  follow  upon  the
process  of  exchange.  We  shall  at  once
analyse  the  former  theory.
It  is  premised  that  certain  articles  have
been  produced  in  certain  ratios  and  that
there  exist  given  quantities  of  these  articles
to  dispose  of.  The  problem  is  to  determine