CONCEPTIONS AND METHODS OF ECONOMICS 15 



observed and tested interrelations of material things; economics 

 with the relations of man's thought with the utilitarian aspects of 

 things. In this view the economist's problem as a whole is more 

 complex, shifting, and elusive than either of the other types of 

 problem. In part the problem can be studied in the realm of man's 

 psychical nature, --his feelings and his judgments; in part in the 

 physical world which appeals to and gratifies his desires; and 

 finally in the relations between his psychical nature and the object- 

 ive world. The value problem always involves this last relationship. 



The nature of the economic problem should determine the methods 

 of economic inquiry. According as the ultimate relation is ap- 

 proached from the side of man's nature or from the side of the mate- 

 rial world, either the subjective or the objective method of study is 

 employed. The two are separable in thought and practice, and yet 

 as each is pursued it moves toward the other, and the labors and 

 results of all students should combine at last into one harmonious 

 body of knowledge. 



Subjective economics. The problem of subjective economic 

 analysis is that of interpreting man's psychical nature, his impulses, 

 his wants, his modes of thought, so far as they are concerned with 

 the utilization of the outer world. The subjective analysis should 

 discover and express clearly the economic conceptions which men 

 have regarding things, and it should thus clarify and harmonize the 

 economic categories. In other words it should provide, in place of 

 shifting and individual points of view, certain generally recognized 

 outlooks, from which the whole economic globe can be scientifically 

 charted and surveyed. The subjective study is to discover which 

 among the many shifting points of view are most frequently taken, 

 most essential, most grounded in the logical nature of the case. 



The need in clear thinking of keeping the subjective and the 

 objective conceptions distinct may be seen in the confusion that 

 long has continued in the theory of land and rent. It could not 

 escape the earliest economic inquirers that some things appeal to 

 men as durable yielders of usufructs. What is paid for the use of 

 agents considered as indestructible was the "return " or rent for 

 them. In the eighteenth century, when the effort was made to 

 formulate a system of economic thought, it chanced that the only 

 large class of wealth dealt with in the market under the usufruct- 

 contract was land. Not apprehending the distinction between the 

 subjective and the objective basis of economic conception, the early 

 economists linked the idea of usufruct with that of natural resources 

 in a hybrid, illogical conception of rent, which has continued for a 

 century to puzzle and defeat much economic inquiry. 



The first form in which the time-aspect of value challenged a 

 theoretical explanation was that of interest on money loans. 



