28

POLITICAL  ECONOMY

the  method  of  watching,  directly  or  in  records,
multitudes  of  facts  with  a  view  to  discovering
their  causal  relationships,  whether  it  is
applied  to  existing  conditions  or  historically,
everybody  is  fully  convinced  in  these  days.
But  pure  induction  is  not  a  flawless  method.
It  labours  under  the  limitation  that,  though
it  can  declare  what  is,  it  cannot  unaided
explain  why  it  is.  To  explain  why  a  law  holds
we  must  always  have  recourse  to  analysis.
Nevertheless,  induction  is  indispensable,  and
no  more  subordinate  than  deduction.  The
former  indicates  what  needs  to  be  explained  ;
and  to  discover  what  needs  explanation  is
sometimes  far  more  difficult  than  to  explain.
Moreover,  by  separating  from  the  seeming
chaos  of  economic  phenomena  the  sequences
and  co-existences  which  are  repeated,  it
suggests  uniformities,  and  thus  gives  birth
to  the  soul  of  scientific  explanation,  the
hypothesis.  Further,  its  aid  must  be  enlisted
in  the  testing  of  hypothesis.
The  broad  generalisations  of  economics,
as  those  of  every  other  science,  are  concerned
with  tendencies.  We  are  not,  therefore,
trying  to  discover  exactly  what  happens
at  any  moment  of  time,  and  it  would  not  be
of  much  value  merely  to  describe  the  economic
world  to  those  gifted  with  powers  of  observa-