1906-7.] - IGNORED DISTINCTIONS IN ECONOMICS. 305 
IGNORED DISTINCTIONS IN ECONOMICS. 
By W. A. Douc.ass, -B.A. 
[Read 28th April, 1907] 
My oBjEctT in this paper is to show the relationship between wealth 
and value, and also, to point out that value is not simple, as is so commonly 
taught, but that it is of two kinds, the increase of value in one case 
indicating an increase of wealth, and an increase of value in the other 
case indicating an increase of poverty. 
When the farmer sows a bushel of wheat and reaps twenty bushels, 
when the clothier multiplies the supply of garments or the mechanic 
multiplies the quantity of implements, there is a multiplication of value 
and also a multiplication of wealth concurrently.- It is to this relation- 
ship of wealth and value that the attention of the student has been prin- 
cipally confined, so that many writers on this subject have concluded 
that wealth and value are identical. In the minds of the multitude, 
this belief is almost universal. So far has this doctrine gained vogue, 
that a vast number of the writers on economics have fixed on value 
as the distinguishing characteristic of wealth, and have consequently defin- 
ed wealth as consisting of ‘‘those things which possess exchange value.’ 
A further examination, however, will show not only that this is a 
fallacy, but that it isa fallacy fatal to a proper understanding of econ- 
omic science. 
Sometime ago I found a most interesting document in the Buffalo 
Public Library. It was a newspaper, published during the siege of Vicks- 
burg in June, 1863. ‘The printing was on the reverse side of some wall 
paper. In one paragraph the editor was denouncing, in language most 
vituperous and scorching, the manner in which certain parties were doling 
out provisions at most extortionate rates—flour e.g. at a dollar per pound, 
say two hundred dollars per barrel. No one would for one moment 
specify this increase in value as an increase of wealth. And, when the 
siege was over, and the price of provisions had fallen to their normal 
figure, no one would dream of calling this decline in value a diminution 
of wealth. 
When the opening of the Suez Canal reduced freight rates from 
Bombay to London from 32 cents per bushel to 16 cents; when the open- 
ing of the Erie Canal reduced the cost of conveying a ton of freight from 
