2 Economic Cycles: Their Law and Cause 



upon agriculture. Another momentous step was taken 

 in the direction of theoretical development when the 

 English economists formulated the law of diminishing 

 returns in agriculture and traced its all-pervasive 

 influence in the production and distribution of the 

 product of industry. The desideratum of economic 

 dynamics at the present time is the discovery of a law 

 that shall be to a changing society what the law of 

 diminishing returns in agriculture is to a society in a 

 comparatively static condition. 



The full truth in the old Physiocratic doctrine has 

 not been exploited. The Department of Agriculture 

 of the United States reaffirms the central idea of the 

 doctrine in its motto: "Agriculture is the Foundation 

 of Manufacture and Commerce," and in the spirit of 

 this motto it publishes invaluable statistical data. 



It is proverbial that the farmer is at the mercy of the 

 weather. If it be true that the explanation of economic 

 cycles is to be found in the law of supply of agricultural 

 products, it is surely wise in a study of rhythmic eco- 

 nomic changes to inquire whether the law of the chang- 

 ing supply of raw material is not associated with a law of 

 changing weather. Is there a well-defined law of chang- 

 ing weather? 



Supposing that it is possible to discover that the 

 weather passes through cycles of definite periods and 

 definite amplitudes, it will then be necessary to show 

 how the crops are affected by the weather and how the 

 cycles of the weather are reproduced in cycles of the 

 yield of the principal crops. 



