MICHIGAN ACADEMY OF SCIENCE. 147 



fill the author's promise to develop dynamic laws, his static laws loom 

 large in the background. Whatever prevents the working- of static 

 Jaw^s — that is. free competition — should be regulated. The thought pro- 

 cesses are stimulating, but the book contributes nothing to economic 

 essentials. 



A disciple of Professor Clark, Alvin S. Johnson, has recently pub- 

 lished an InfrodiK'toii/ Economics (1907) which is harder-headed and 

 less open to the above criticisms that the work of his master. Wieser's 

 theory of value is admirably adapted, but cost is given an important 

 part in determination ; and though land is included under capital goods, 

 its peculiarities are emphasized and the fact that the recent disputes 

 over the place of land really rest upon the distinction between capital 

 funds and capital goods is plainly apparent. 



Professor Simon N. Patten is one of the most unique economists 

 America has produced. But his genius is erratic — almost perverse. 

 Patten's chief economic writings are Premises of Political Economy 

 (1885), The Consumption of WcaWi (1889), DynaniiG Economics (1892), 

 and The Theory of Prosperity (1902). To briefly indicate some of his 

 characteristic doctrines: he has developed the idea of the importance of 

 consumption, making changes which adapt it to environment a factor 

 in reducing costs as men progress ; he is optimistic, denying the existence 

 of a law of diminishing returns ; to him the shares in distribution are 

 price-determined, costs cutting no figure ; and in order to harmonize the 

 idea of increasing demands with that of increasing returns monopoly is 

 made normal and given a large part.^ The ideas of alternative use and 

 opportunity costs find frequent expression. Patten has pointed out that 

 land once brought under cultivation will not be abandoned exactly at 

 the point where returns just fail to cover cost, but that production will 

 be carried further. 



Professor Patten's main ideas underlie the more recent "Economics" 

 by Xearing and Watson, — a crude but stimulating text. 



Professor Irving Fisher has summed up his economic theories in two 

 recent volumes: The Xature of Capital and Income (1906), and The 

 Rate of Interest (1907) . It does not seem that thes« books can be classed 

 with the works of Clark and Patten in so far as additions of funda- 

 mental importance to economic theory are concerned. The writer reasons 

 clearly. By adopting the accountant's view])oint he has shed some new 

 light, — though his writings do not escape illustrating the difticulty of 

 adopting a new terminology. The Austrian idea is the dominant one: 

 the value of cajjital goods, including land, is the discounted value of 

 their income. And a point upon which much stress is laid is that in- 

 come must not be confused with the material objects (capital) which 

 afford it, but consists of the services rendered. The interest rate, the 

 determination of which Fisher would make the chief problem of Econo- 

 mics, depends upon the "time preference" of individuals for present 

 over future goods, — an "agio" theory. 



^"The motives for production increase as wants grow in intensity : but costs fall off with 

 the growth of productive power, thus destroying the equality between it and the return 

 in goods. A new equilibrium is created on the market by the equality of marginal expense 

 and marginal utility. Wants grow more rapidly than productive powers : values rise, and 

 producers gain a monopoly power equal to the difference between cost and the expense 

 of goods. Monopoly is thus essential to a market equilibrium and the monopoly fund has 

 its size fixed by tlie natural excess of demand over supply. Intense wants and low costs 

 of production have no other means of equating themselves." Theory of Prosperity, p. 234. 



