INTRODUCTORY

21

value  of  goods  by  small  changes  in  their
supply,  the  differences  made  to  the  worth
of  capital  by  slight  accessions  to  its  quantity, ­
  the  differences  made  to  the  burden  of
labour  by  some  lengthening  of  the  hours  of
work,  and  so  forth.  The  marginal  theory  has
been  caustically  described  as  the  theory  that
the  tail  wags  the  dog.  There  is  a  certain
truth  in  the  remark;  but  the  intended  jibe,
instead  of  nailing  a  fallacy  to  the  counter,
draws  attention  to  a  highly  significant  fact.
In  the  determination  of  value  it  is  the  last
steps  that  count—the  last  step  on  the  side
of  demand,  and  the  last  step  on  the  side  of
supply.
Foreshadowings  and  even  partial  applications ­
  of  the  marginal  theory  may  be  discovered ­
  in  the  old  economics  ;  but  it  is
one  thing  to  understand  the  essential  nature
of  a  particular  kind  of  causation  and  detect
its  workings  in  apparently  dissimilar  actions
and  reactions,  and  another  thing  to  give  now
and  then  a  reason  for  phenomena  implying  the
same  kind  of  causation,  without  being  alive
to  its  peculiarity  and  far-reaching  influence.
“Demand”  and  “supply”  used  to  be  the
magic  wands  for  solving  all  economic  problems,
—and  in  the  worst  days  of  error  they  were
indiscriminately  applied  to  everything  “from