218 HISTORY OF ECONOMIC INSTITUTIONS 



but like economic conditions that give a sound basis for prediction. 

 Social prediction is of necessity based on data drawn from different 

 races, institutions, and civilizations. This evidence has little value 

 unless a similarity of economic conditions exists as the antecedent 

 of race, institution, or civilization. An economic interpretation of 

 past events must therefore precede valid prediction. 



There are two channels in which thought runs and two bases 

 on which it rests. The physical environment of a man is made 

 up of objects upon which welfare depends. The force that per- 

 petuates and increases this contact is desire. No object is a part 

 of the conscious environment of men until they desire it or the 

 means of avoiding it. Thought based on desire or arising out of its 

 influence is plainly economic. But thought has another element not 

 derived from the immediate objects of interest. This is tradition. 

 Past conditions and events do not persist. The events and condi- 

 tions of to-day cease with to-day, but new ones appear to-morrow. 

 Economic conditions are thus short-lived, but the habits and thoughts 

 that yesterday's conditions evoked live on and modify the present. 



The newer biology makes the distinction between natural and 

 acquired characters and affirms that the latter are not inherited. 

 All acquired knowledge must pass from generation to generation by 

 the repeated impressment of habits and thought upon the individuals 

 of succeeding generations. This knowledge depending on constant 

 repetition for its continuance is tradition, and imitation is its great 

 vitalizing force. Economic thought is the social expression of desire 

 as tradition is the social expression of imitation. These two forces 

 control current events, and the differing interpretations of the past 

 and the present depend upon the relative emphasis given them. 



Professor Giddings has shown that the stimuli arousing activity 

 are of two orders. 1 The original stimuli come from the immediate 

 environment; the secondary stimuli are the products of past social 

 life kept alive in the present. These products of past social life have, 

 however, only one way of being continued, and that is through 

 the constant repetition that creates tradition. The original stimuli 

 also are of no importance unless they awake response, and this 

 response is desire. 



Changing the viewpoint from stimuli to that of response to stimuli 

 makes desire and tradition the sole forces that determine present 

 action. In this contrast tradition includes all of the products of 

 past responses that have been continued through imitation rein- 

 forced by repetition. These traditions blend, and as they blend 

 they become the basis of history, institutions, and ideals. Desire 

 operating under favorable conditions creates mobility of men and 



1 " A Theory of Social Causation," a paper read before the American Economic 

 Association at the New Orleans meeting. 



