ECONOMIC THEORY IN A NEW RELATION 49 



forces with which the economist has to reckon ; and if in the midst of 

 the over-turnings which result there can be detected the orderly work- 

 ing of economic law, nothing can be more important or practical 

 than discovering it. 



The larger part of the work heretofore done in the realm of eco- 

 nomic theory has consisted in a search for standards of value, wages, 

 interest, rent, and in attaining truths so general that it is not depend- 

 ent on the amount of progress which a society has made. There is, 

 for example, the natural price for an article of commerce based on the 

 cost of making it, and towards this standard the actual price of an 

 article, at any stage in the development of a civilized society, is 

 always tending. There is a natural rate of pay for labor of a given 

 quality, to which the wages of actual workmen of this grade steadily 

 tend to conform; and there is a normal standard of rent for each 

 piece of land which the amount that the owner actually gets closely 

 or remotely approximates. 



The establishing of scientific standards such as these does not 

 necessarily call one far into the field of history, though statistical 

 tables are eminently useful in assisting in the process and in verifying 

 its results. The theoretical work is chiefly static and it is in the 

 realm of dynamics that the historical data become most essential. 



The economists have been quick to admit that this tendency 

 of values, etc., to conform to their theoretical standards is obstructed 

 by adverse influences and that the price of a commodity, the pay of 

 a workman or the rent of a piece of land is seldom, as they would have 

 said, exactly natural or, as we might say, static. They have admitted 

 the inexactness of the working of economic law, but have ascribed it 

 to friction and obstruction rather than to anything more general and 

 legitimate. It has not been clearly perceived that it is organic 

 change in society itself which causes the abiding differences between 

 the traditional standards of value, wages, and rent, and the actual 

 rates. The newer theory will give itself to the study of such organic 

 change and this will tie it closely to practical life and make theory on 

 the one side and statistics and history on the other mutually indis- 

 pensable. It will not confound theory with fact, but will make 

 theory dependent on fact, and vice versa. The assumptions with 

 which it starts will be supposed realities which it is in order to test 

 by practical inquiry, and the conclusions will be subjected to the 

 same testing process. On the other hand, the principles tentatively 

 attained by the use of the assumed premises will become an indis- 

 pensable guide in the search for facts. They will lead to the dis- 

 covery of facts which mean something and are capable of orderly 

 arrangement and interpretation. Otherwise there is danger of col- 

 lecting a mass of information so vast and chaotic that it will be useful 

 chiefly as a means of moral discipline for the baffled student. 



