[32] It is, of course, recognized that exchange modifies value in so far as exchange is a _productive_ process. But the essential thing here is the _transfer_ aspect of exchange, which would hold even in a communistic society where value relations might be found out by some process other than exchange. [33] _Political Economy_, New York, 1888, p. 84. [34] _Cours d'Economie Politique_, vol. I, pp. 8-9. [35] Edgeworth, F. Y., _Mathematical Psychics_, London, 1881, chapter on "Unnumerical Mathematics," pp. 83 _et seq._ [36] A fuller discussion of the functions of the value concept is given in chapter XI where this argument is materially strengthened. The points here made, however, seem adequate. [37] Jevons, _Principles of Economics_, 1905 (posthumous), p. 50. [38] Walker, _op. cit._, p. 5. [39] Marx, _op. cit._, vol. I, chap. I. [40] Laughlin, _Elements_, p. 77. _Cf._ also, Ely, _op. cit._, 99-100. [41] _Ibid._, p. 18. It is interesting to note that Professor Irving Fisher so defines wealth and value as to divorce the two concepts. Wealth includes free human beings, who cannot be exchanged, while the idea of value is derived from that of price, which, in turn, comes from the ideas of exchange and transfer. (_Nature of Capital and Income_, chap. I.) [42] _Principles_, pp. 8-11. [43] _Money_, p. 288. [44] _Cf._ Kinley, _op. cit._, Merriam, _loc. cit._, and Carver, "The Concept of an Economic Quantity," _loc. cit._ _Cf._ also, Laughlin, _Money_, 1903, pp. 14-16; and Davenport, _Value and Distribution_, p. 181, n. CHAPTER III VALUE AND MARGINAL UTILITY The method of Jevons and the Austrians, and, for that matter, of the great majority of value theorists, including even the social value school, in seeking the determinants of value, is to start with individual "utilities" or psychic "costs" directly connected with the consumption or production of goods. Such a study, if confined to an isolated individual economy, or if confined to an ideal communistic economy, like that for which Wieser works out his laws of "natural value," seems to yield us quantities of "utility," which may properly be called values, or quantities of sacrifice which may be properly treated as exactly measuring values.[45] But when applied to a competitive society, or to any society where there are inequalities among men in their power to attain the gratification of their wants, it yields us, not quantities of value, but only particular ratios between such quantities, or prices. An examination of the Austrian procedure will make this clear.