The basic facts of economics : $b A common-sense primer for advanced studentsPost, Louis F. (Louis Freeland)
General
The basic facts of economics : $b A common-sense primer for advanced students
Post, Louis F. (Louis Freeland)
Economics
A different type of illustration, though identical in Economic
terminology, would be an urban residence or a building for business.
Its site, the enveloping atmosphere, the space--all these are in the
Economic category of Natural Resources or Land. But the building is
an Artificial Object and therefore in the category of Wealth. If the
building burn down or be torn down, then the property--the site and the
space it commands--is in the category of Land alone. In no respect can
the site and the space it commands be Wealth in the technical Economic
sense--in the discriminative sense which identifies basic differences.
In that sense nothing is or can be Wealth except Artificial Objects
produced by Man from and upon Natural Resources. The common
characteristic of Wealth in the technical Economic sense is that
it consists of natural substances which have been adapted by human
exertion to human uses. Another term would serve as well, but no term
would serve if used also to designate something radically different.
IV. SECONDARY CATEGORIES
In Economic analysis Wealth takes on two aspects. They are
distinguishable by secondary classifications. One is Wealth in the
possession of consumers; the other is Wealth in process of utilization
by Labor for the production of further Wealth. For the former no
technical Economic term is in use; for the latter the technical
Economic term is Capital.
1--_Capital_
Capital is a highly important technical term in Economics. It must
not be confused, therefore, with the same word as loosely used in
business accounts, where, like the term for its parent category,
Wealth, it mingles such essentially different things as Wealth and
Land--Artificial Products and Natural Resources. And, as observed in a
preceding paragraph, not only such different things as Wealth and Land,
but in some circumstances Labor also.
Such undiscriminating uses of the term Capital are doubtless defensible
enough in business accountings; for in private business anything may
be thought of as business “capital” if it can be summarized in terms
of Money. But for Economics as a comprehensive social science, the
dumping into the same basic category of such radically different things
as Labor, Land and Wealth--Man, Natural Resources and Artificial
Objects--is indefensible and miraculously confusing.
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