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with the amplitude of literary illustration. Flowing water forms his favourite metaphor. As the water-power which the manufacturer buys is permanent, though the particles of water come and go, so capital as a whole is permanent, while particular bits of “capitalgoods," as Professor Clark prefers to say, are perishable. It is thus that we are to understand Mill's fundamental proposition that capital is consumed. Another of Mill's fundamental propositions, that “capital is the result of saving,” is accepted by Professor Clark only with reference to the genesis of new capital (the emphasis is his). “The maintenance of it,” he says, “ does not require abstinence" (139).

“In the static state there is no abstinence." (136.)

“Let us . . . plant a forest of such slow-growing trees that it will take fifty years to bring one of them to the point of maturity at which it will be ready for cutting. Let us arrange the trees in rows, and plant one row each year. During this part of the process there is waiting to be done. . . . After fifty years, the cutting begins; and now all waiting is over.

We may cut every year a row from the ripe end of the forest, and plant a row at the oppo. site end. ... The setting out of a new row of trees is now a very different thing from the planting of the original row fifty years ago; for in a sense the present planting yields firewood at once.” (132.)

Among many just observations on the nature of capital may be noticed the connexion attributed to two variables, which Mill sometimes treats as independent (Pol. Econ., Book IV.), the amount of capital and the state of the productive arts.

“ The men who are working with the smaller capital perform one set of acts, and those who have the greater capital in their hands perform another set. Arts are always practised in new and changed ways when capital multiplies itself and takes the shape of costly and elaborate machinery.” (159.)

Capital, too, is "completely transmutable in form,” while permanent in quantity. “Society can quit making one kind of instrument and make another” (186). This variation in the forms of production adapts itself to demand.

"The value of goods on the one hand, and the productivity of the two agents, labour and capital, on the other hand, depend on the same general law. . . . It may be called a law of variation of economic results, and if it were stated in its entirety it would give unexpected unity and completeness to the science of economics." (209.)

Considering the relation between the value of goods and their final utility, Professor Clark dwells on the distinction between the last increment which the consumer may add either to the number of articles of a certain sort, e.g., coats, or to the quality thereof.

The former, " the accepted” view, would make commodities much more valuable than they actually are.

“Figuratively speaking, in a very good canoe these are a dead tree, a log, a dug-out, a convenient sailing boat, and an elegant one." (239.) No. 40.–VOL. X.




“Each element in it is a final utility to some class, and it is that class only whose mental estimate of it fixes its price." (241 )

Things sell according to their final utilities, but it is their final utilities to Society.(243.)

Society as a whole is the appraiser of goods." (Ibid.) This use of “ society as a whole

may help us to understand the statement concerning the “ultimate unit of value," that it corresponds to “the pain suffered by society as a whole in the final period of daily labour” (392).

" Some exceptions here and there may perhaps be taken to the expressions which we have quoted. Thus is it so certain that no "abstinence" is required in order to keep up the existing stock of capital? The owners of the forest which was taken as a type must at least abstain from cutting down the immature trees for the sake of making a bonfire or some other immediate, though (comparatively with what would have been obtained by waiting) small, advantage. But in the main, we submit, the passages briefly indicated with their contexts contain a body of doctrine which will be generally accepted.

Some other dicta strike us as not equally certain, rather probable" in the Jesuitical sense of opinions which have been held by “grave doctors," and may accordingly be followed, notwithstanding the misgivings of common sense. Three almost casuistical enquiries may be arranged under the traditional triple division of the parties to distribution. (1) The rent of land is not sharply demarcated by Professor Clark from the payment for other agents of production. He dwells more on the similarities than the differences between the two categories. He is deeply impressed with a truth which Professor Marshall has expressed in the following passage :

“ Land is but a particular form of capital from the point of view of the individual manufacturer or cultivator. And ... the existing stock of it tends to be shifted from one use to another till nothing could be gained for production by any further shifting. (Principles of Economics, Vol. IV., Book VI., ch. ii. cf. ibid., Book VI., ch. ii., § 13, and Book VI., ch. ix., $ 6.) In Professor Clark's words :

“ The earnings of every kind of capital-goods can be brought into the form of surpluses, and land is not unique in this particular, . . . The positive power of each bit of land to create wealth fixes the rent of it, just as the positive power of each unit of capital to create wealth fixes the interest on it.” (345.)

What Professor Marshall, in the context of the passage quoted, describes as "the other side," the peculiarities of land, is not made prominent by Professor Clark's phraseology and forms of thought. And perhaps this omission is proper while we confine ourselves to the static condition. It leads, however, to a somewhat harsh use of familiar terms, e.g.“ Total interest equals total rent." (2) A question which cannot be regarded as verbal is raised by the passages which indicate the author's views on distributive justice. He tells us

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“ that the question whether the labourer is exploited and robbed (ch. i.) depends on the question whether he gets his product." And what getting his product means is explained in the following passages :

“We are to get what we produce-such is the dominant rule of life ; and what we

are able to produce by means of labour is determined by what a final unit of mere labour can add to the product that can be created without its aid." (180.)

“ If each productive function is paid for according to the amount of its product' thus reckoned,' then each man gets what he himself produces.”

" The product of labour everywhere may be disentangled from the product of co-operating agents and separately identified.”

“ If terms be defined with care, final productivity and specific productivity mean the same thing."

However terms are defined, the doctrine as we interpret comes to the old doctrine-as old at least as Burke's Thoughts on Scarcity, in which he invokes “ the laws of commerce against the claims of the “labouring poor”--that the division of the total produce effected by the play of the labour market, or which would be effected if the market played freely, constitutes the best possible distribution. Doubtless it is difficult to find a better. Yet there are those who doubt whether a fair wage may not be defined by some other criterion than the produce added by the marginal labourer, whether our author has not too slightly dismissed the aspirations embodied in other definitions. (3) In another respect it may seem that Professor Clark harks back to classical usage when he throws into the shade the entrepreneur as a party to distribution.

“ The prices that conform to the cost of production are, of course, those which give no clear profit to the entrepreneur.(70.)

“ Cost price is, of course, no-profit price. They afford, in the case of each article, enough to pay wages for the labour and interest on the capital that are used in making it; but they give no net surplus to the entrepreneur as such.” (79.)

“ The static conditions assumed in the present study preclude the existence of such entrepreneur's gains." (204, cf. 111.)

“If competition worked without let, entrepreneurs, as such, could never get and keep any income.” (410.)

We are well aware that similar views are held by many grave doctors on the European Continent. And doubtless the reservation made in the words “as such ” is capable of explaining away any paradox. Yet before subscribing to our author's “of course,” one would like to know what the proposition is intended to contradict; who they are who affirm, and in what context, that entrepreneurs “ as such ” do make an income. But we are sensible that such questions cannot be adequately discussed within the narrow limits available at present.


Taxation of Land Values and the Single Tax. By W. SMART.

(Glasgow: James Maclehose. 1900. Pp. 122.)

WRITING from the land of “feus” and the centre of the agitation for taxing them, Professor Smart testifies from personal knowledge as to the motives of the agitators. He is doubtless right in connecting the movement with the form of confiscation known as " the single tax.” Some of the more refined reasoning in favour of the “Glasgow Bill” we forbear to transcribe, finding a difficulty, as Mill says in another connexion," in giving any statement of it which shall be at once clear and satisfactory to its supporters.” Professor Smart dwells on the difficulty of valuing sites apart from buildings, and the special injustice of rating the feu-owner of whom it cannot be said, as it is of site-owners in London, that they are benefited by the rates. Professor Smart introduces his polemic by an exposition of the “recognised theory of taxation.” His application of the term price to that portion of taxation which is not proportioned to benefit, but distributed according to the principle of equal sacrifice, can hardly be described as “recognised.” That character, however, may fairly be attributed to the substance of the introduction. Thus the popular identification of equal and minimum sacrifice is happily caught in the following passage:

· This [our] purpose is to raise a very large sum of money with a minimum of burden to each. Now we raise this sum from a very large number of people; and the hardship of a rough and ready measurement of equality is minimised by the smallness of the sum required from each.”



Studies in State Taxation, with particular reference to the

Southern States. By Graduates and Students of the Johns
Hopkins University. Edited by J. HOLLANDER. (Balti-

more: Johns Hopkins Press.)

This minute description of the tax-systems in five of the United States of America is not without interest to the British reader. Those among us who talk lightly of rating personal property may take warning from the example of the American property tax. In Kansas “it is not an uncommon practice to assess personal property at about onethird of its actual value, but the variations ... are great. In 1897 the assessors of Atchison County decided to rate personal property at 25 per cent. of its true value; Chase County at 33}; Elk County at 40 per cent. ;” and so on, up to “Decatur County at 100 per cent." (p. 150).

In Georgia the total of the watches, rings, diamonds, precious stones, &c., in a county containing a city with a population over sixty-five thousand was valued at $108,083. A large percentage of such articles are not returned at "anything like their market value" (pp. 202-3).

On the other hand, in Maryland, the tax is said not to work so very badly.

“A large proportion of the securities which are said to escape' are mere liens upon tangible property upon which the proper taxes are paid ” (p. 44).

Nor does the proposal which we sometimes hear (with reference to vacant sites) to tax the capital value of land derive support from American experience.

“I am convinced from personal examination of actual sale values, as compared with assessed values extending over several years and including the returns from fourteen townships, that unusually high assessments in special cases, irregularity everywhere, and a general tendency toward over assessment of the small cheap tracts are prevailing conditions" (Mr. Kenton with reference to Kansas, p. 155).

The man with almost nine times as much property pays only three times as much tax” (ibid.).

Doubtless some of these evils may be ascribed to the removable defect of incompetency in the assessors. Some interesting questions on the theory of incidence are suggested by the prevalence of taxes on “ licenses.” Thus we read that :

“ Mississippi in accord with the general practice of Southern commonwealths imposes a privilege-license tax on well-nigh every occupation." A list of the occupations subject to a license tax in Georgia occupies more than a page, e.g.:

“Pawnbrokers are taxed fifty dollars for each place of business. All itinerant doctors, dentists, opticians, or specialists are taxed ten dollars for each county in which they may do business.” “ Dealers in cigarettes are taxed five dollars for each place of business.

“Every agent of a matrimonial, natal, or nuptial company is taxed one hundred dollars for each county in which he may do business.”

A poll-tax would be a curiosum of great interest, but for the open secret that, in Mississippi at least, it is used as a means of disqualifying the negro in national elections and controlling his vote in local elections.


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