DEFINITION OF SOME MODERN SCIENCES. 109 



goods, the fruits of this cooperation divided among the participants, 

 the products themselves change hands from one person to another 

 before they were used directly for the satisfaction of desire. In other 

 words, they saw the economic sequence of production, exchange, dis- 

 tribution and consumption, and it became the object of political 

 economy to discover the conditions and rules under which these 

 phenomena were enacted in the daily affairs of men. As parts of one 

 sequence they had relations one to another in which were enmeshed 

 the relations of the human beings who conducted them. Upon what 

 principle do the latter act ? 



Observation that to most men labor is irksome led to the axiom that 

 in all economic activity men sought the maximum result with the 

 minimum effort. This homely psychological generalization is as 

 fundamental to the interpretation of economic phenomena as the 

 equally homely physical generalization that nature's wants, with refer- 

 ence to man's desires, are limited. It has appeared in various guises, of 

 which perhaps the most obnoxious is the concept of the economic man, 

 who in all his doings follows the precepts of an enlightened self-interest 

 — a being unknown to actual observation, who has merited the scorn 

 which has been heaped upon him. Man in his economic dealings fol- 

 lows his self-interest according to the measure of his enlightment, but 

 it cannot be denied that very frequently the light which is in him is 

 darkness. The economic man is an ideal towards which, solely in 

 their economic dealings and without reference to other activities, the 

 men of every-day life strive. K"o adequate explanation of the affairs 

 of life can be made on any other assumption than that men follow 

 their rational interests so far as they perceive them and that foremost 

 among them is the desire to obtain the largest result with the least 

 expenditure of effort. 



Thus understood, the economic man is the key by which the 

 economist seeks to interpret the affairs of every-day life. It is simply 

 the key, and not the subject matter to be interpreted. This the 

 economist finds around him, varying at different stages of the world's 

 progress with the growth of knowledge, the order of society and the 

 diffusion of wealth. 



These elementary considerations of the scope of political economy 

 have briefly indicated the nature of its method. With a few simple 

 generalizations it seeks to interpret the composite phenomena which it 

 observes. Observation, therefore, and deduction are inextricably com- 

 bined in it. If the concrete basis upon which it rests is forgotten and 

 cbservation is thrown into the background, the result is a strongly 

 deductive analysis which applies a few simple conditions to the suc- 

 cessive phenomena of the economic sequence to be interpreted. This 

 is the characteristic of the classical or orthodox school of political 



