A full exposition would have to define the sphere of Political Economy by describing its data and its methods. What do we assume, and how do we reason? A complete answer to these questions would indicate the limits within which we can hope for valid conclusions. I will first refer, briefly, to a common statement of one theory advocated by the old-fashioned or classical school. Economic doctrine, they have said, supposes a certain process of abstraction. We have to do with what has been called the "economic man". He is not, happily, the real man. He is an imaginary being, whose sole principle of action is to buy in the cheapest and sell in the dearest market: a man, more briefly, who always prefers a guinea--even a dirty guinea--to a pound of the cleanest. Economists reply to the remonstrances of those who deny the existence of such a monster, by adding that they do not for a moment suppose that men in general, or even tradesmen or stockbrokers, are in reality such beings,--mere money-making machines, stripped bare of all generous or altruistic sentiment--but simply that, as a matter of fact, most people do, _ceteris paribus_, prefer a guinea to a pound; and that so large a part of our industrial activity is carried on from motives of this kind, that we may obtain a fair approximation to the actual course of affairs by considering them as the sole motives. We shall not go wrong, for example, in financial questions, by assuming that the sole motive of speculators in the Stock Exchange is the desire to make money. Now, it is possible, perhaps, to justify this way of putting the case, by certain qualifications. I think, however, that, if strictly interpreted, it is apt to cover a serious fallacy. The "economic man" theory, we may say, assumes too much in one direction, and too little in another. It assumes too much if it is understood as implying that the desire for wealth is a purely selfish desire. A man may desire to make money in order simply to gratify his own sensual appetites. But he may also desire to be independent; and that may include a desire to do his part in the work of society, and probably does include some desire to relieve others of a burden. The wish to be self-supporting is not necessarily or purely "selfish". And obviously, too, one great motive in all such occupations is the desire to support a family, and one main inducement to saving is the desire to support it after your own death. Remove such motives, and half the impulses to regular industrial energy of all kinds would be destroyed. We must, therefore, give our "economic man" credit for motives referring to many interests besides those which he buttons into his own waistcoat. And therefore, too, as I have said, the assumption is insufficient. The very conception of economic science supposes all that is supposed, in the growth of a settled order of society. The purest type of the "economic man," as he is sometimes described, would be realised in the