ORGANIZATION OF THE AGRICULTURAL ENTERPRISE 315 



machines, material, labor, etc. But these numerous agents fall into 

 two great groups called factors of production, variously named as 

 man and nature, labor and material agents, or humanity and wealth. 

 We must bear in mind that they are complementary agents and com- 

 plementary factors: labor in a void and wealth without labor would 

 be equally useless. 



Man is not content merely to gather what is provided, but inter- 

 venes to direct the course of industry. Every act of labor and every 

 use of goods calls for some decision and direction. The owner of a 

 fund of purchasing power cannot leave it to invest itself. The pri- 

 mary function of enterprise is the choice of a business in which to 

 invest; the next, and essentially last function, is to provide competent 

 management. Even for the solitary worker the choice of the right 

 time, kind, place, and method of work is most important. There is 

 also a wide range of choice in the distributing and combining of labor, 

 agents, and materials. A limited supply of agents can be used to 

 secure a variety of goods, more or less desirable. There is a choice 

 in ways and methods by which a thing may be done. There are many 

 wrong ways, there is but one best way, at any stage of industrial 

 progress. While most work is done in customary ways and. little 

 independent judgment is required, yet in every kind of industry new 

 problems constantly arise and call for the exercise of choice as to 

 methods. The ability to choose and to do wisely is an element in 

 personal skill in every economic activity. This quality in the man 

 is managing ability, and the action of directing economic activity is 

 business management. 



When various industrial groups are associated, direction becomes 

 still more important, and the need grows for high ability to manage 

 and direct the great units of industry. In the single group it is an 

 internal harmony alone that is needed. The work of a dozen men 

 must be so arranged that each is in his fitting place. But as this 

 group comes into contact with others, the relationship becomes two- 

 fold, and there must be both internal and external harmony. Out- 

 look upon business conditions and commercial ability become neces- 

 sary. The more complex the economic organization of society, the 

 greater the chance of mistake and the more injurious are the mistakes 

 to a wide range of interests. Large amounts of wealth and labor can 

 be rapidly lost through lack of wise direction of an associated group. 



Ever since the beginning of human society some degree of organi- 

 zation of industry has existed. In every community by some method, 

 however crude, a practical way has been found of determining who 



