Principles of Political Economy, Vol. 1Roscher, Wilhelm
History
Principles of Political Economy, Vol. 1
Roscher, Wilhelm
Economics
The purchaser, besides the value in use of the goods he desires to buy,
considers his own solvability (_Zahlungsfähigkeit_ = ability to pay). It
is only solvent demand which can influence prices.(624) For instance,
among a people made up almost entirely of proletarians, there will be a
great many cases of starvation and death after a bad harvest, but the
price of corn will undergo only a slight increase.(625) But where the
greater number of inhabitants own property, and where the wealthy come to
the help of the poorer classes by means of poor-rates and acts of
benevolence, it is scarcely possible to assign limits to the increase of
the price of corn. By a necessary connection, when indispensable articles
grow dear, the demand for articles that can be dispensed with generally
decreases, and _vice versa_.(626) Every merchant, engaged in an extensive
business, is interested in knowing in advance the results of the corn
crop. The higher the price of a commodity rises, the narrower, of course,
grows the circle of those who can pay for it.(627)(628)
Section CV.
Supply.
In the case of isolated chance exchanges, the seller, too, takes into
consideration, first of all, value in use, and compares the satisfaction
which the commodity to be parted with and that to be received are able to
afford. It is true that in making this estimate, he is subject in the
highest degree to error and deception.(629) In the well ordered trade of a
nation whose economy is highly developed, the seller, who had this very
trade in view in his production, is wont to consider almost exclusively
the value in exchange of his commodity.
Section CVI.
The Cost Of Production.
As no one is willing to lose anything, every seller will consider what his
goods have cost him, and the cost of producing or procuring them as the
minimum price to be asked for them.(630) At the same time, the idea
covered by the expression cost of production, although it always embraces
whatever disappears from the resources of the producer to enter into
production, varies very much according as it is considered from the point
of view of the individual’s, the nation’s or the world’s economy.
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