458 ~ PROCEEDINGS OF SECTION G. 



cannot be increased by human industry, is a doctrine of the utmost 

 importance in political economy; for from no source do so many 

 errors, and so much difference of opinion in that science proceed, 

 as from the vague ideas which are attached to the word ' value.' " 

 The most important corollary to be drawn from such a doctrine 

 is that all natural elements and their compounds, which form the 

 substance of commodities (whether rare, as gold, silver, or tin; or 

 common, as coal, iron, ore, salt, or water) are, of themselves, free 

 gifts of nature, and do not form any part of value or economic 

 price. Man, by his labour, cannot create the elements of material 

 substances; but, by his forethought, intelligence, and labour, he 

 can modify and transport, and can provide favorable conditions 

 for the production, and for the multiplication, of the natural in- 

 crease of the various specific forms of utility. The latter service 

 of man, and its extent and cost alone constitute the measure of the 

 quality we term value, or price, in the particular compounds of 

 natural elements in which, by the laws of social economy, it has 

 become so closely incorporated, as to be confounded with some 

 supposed intrinsic value, in the natural substance, 'per se. 



The phrase " free gifts of nature " by most people is usually 

 restricted to those things — like pure common air, rain, and sun- 

 shine, so necessary to man's life and comfort — which are obtained, 

 directly, by natural means without the intervention of other men's 

 services; but the acceptance of the doctrine of the primary law of 

 economic price or value, leads us a step further, and compels us to 

 concede that, although all monopolised natural substances, in which 

 man's services have become incorporated and are inseparably asso- 

 ciated with economic price or value, the natural elements, them- 

 selves, do not enter into economic cost in any degree whatever; and 

 therefore, for example, the rare natural element gold, per se, adds 

 as little to economic price or value, as do the more common 

 elements, carbon, hydrogen, oxygen, silica, sodium, chlorine, 

 liitrogen, &c., do, to compounds of common commodities such as 

 coal, common salt, grain, and other food products. It is, we re- 

 peat, the cost of the labour of man, incorporated in any substance, 

 which alone gives such substance any degree of what is known as 

 economic price or value. 



What is Capital? 



Much illusion is generally caused by the varied and conflicting 

 use of the term " capital " by different economic writers when dis- 

 cussing questions concerning the comparative value of the various 

 agencies (human, and fixed auxiliary instruments) engaged in the 

 production of "consumable wealth"; and, also, when applied to 

 questions concerning the comparative value of title, share, or 

 reward, of consumable wealth actually distributed and appro- 

 priated, in each year, by each and all of the various producing 

 agencies. 



