NATURE 



581 



THURSDAY, APRIL 19, 1900. 



ECONOMIC SCIENCE. 

 The Distribution of Income. By William Smart, M.A,, 

 &c., Adam Smith Professor of Political Economy in 

 the University of Glasgow. Pp. xv + 341. (London : 

 Macmillan and Co., Ltd., 1899.) 



POLITICAL Economy is frequently called the dismal 

 science. Just as frequently it is denied the name 

 of science at all, and the denial is fully justified as regards 

 many books on Political Economy, which are full of 

 vague speculation and rhetoric. .\ book like the present, 

 however, shows the reality of the science, and how far, 

 indeed, it is from being more dismal to the ordinary man 

 than any other science which requires close thinking to 

 understand it. A little reading of the present book will, 

 indeed, prove to any intelligent reader that the analysis 

 of the processes of exchange, which it is the function of 

 Political Economy to examine and explain, is full of con- 

 stant interest. Mr. Smart's special object is to show the 

 distribution of the aggregate of what people call their in- 

 dividual incomes, and incidentally he throws a great deal 

 of light on the production of the incomes themselves and 

 what is meant by it, as well as on the automatic organis- 

 ation of industry, which is the condition of the production 

 and distribution. As a corollary, he discusses, from a 

 somewhat novel point of view, the question of the 

 socialistic organisation of society, by which so many 

 think the present organisation can be superseded ; and 

 the proof he furnishes that production and distribution 

 cannot but go hand in hand, and that equitable distribu- 

 tion is better provided for by the present organisation 

 than in any other conceivable way, will be found most 

 striking, and impossible for the Socialists to answer. 



The initial point of the analysis is the connection which 

 the author establishes between the aggregate of the indi- 

 vidual money incomes of a community and the real in- 

 come of that community ; that is, the actual commodities 

 and services which are represented by the money incomes. 

 The reason for this is well set out in the introductory 

 chapter. A man of business and individuals generally 

 reckon their incomes in money. The income is so much 

 " money." The economist, on the other hand, 



" becomes so conscious of the inadequacy and ambiguity 

 of the money measurement that he often fights shy of it 

 altogether, and speaks of income as commodities and 

 services, forgetting that in so doing he has stepped off 

 the platform of the ordinary man. At the same time it 

 may be confessed that he is not altogether consistent in 

 this attitude. Usually, when he passes from the con- 

 sideration of the making of goods to that of selling them 

 and paying the various makers for the making, he falls 

 into the habit of the people around him, and thinks of 

 income as merely so many shillings or sovereigns." 



The author does not fail, however, in his identification 

 of the two things, and in proving the identity he estab- 

 lishes very clearly how production and distribution go 

 hand in hand, and that the one, in a modern industrial 

 community, is not conceivable without the other. 



Without going into the detail of the author's classifi- 

 cation of income, which is hardly necessary in a general 

 study, except for purposes of illustration, we may simply 

 NO. 1 590. VOL. 61] 



notice that there are three main classes .if money income 

 in a country like the United Kingdom. First of all 

 there is the money income arising from the rent of land 

 and houses, and the interest or profits upon capital. 

 Second, there are the money incomes of the professional 

 classes, of the army, navy, and civil services, and of 

 others who render services to the community, but who 

 are not usually spoken of as the working classes. Third, 

 there is the income of the working classes themselves, 

 the sum paid to them for the labour which they expend. 

 Practically, there is no theoretic distinction between the 

 second and third classes of income. The income in 

 both cases is a payment for services rendered. Even 

 the first classes of income, however, cannot be considered 

 as purely the return upon idle capital, which is received 

 by the fortunate possessors of the capital. Nothing is 

 more interesting in the author's analysis than his demon- 

 stration of the amount of labour and anxiety which goes 

 to the making of profits upon capital in almost any 

 form, the capital which can bring in an income to its 

 possessor almost without labour being much more 

 limited in fact than is usually imagined. It is clear 

 also that the share which is paid in respect of capital 

 for a given production still leaves the amount of the 

 share which is paid in respect of labour enormously 

 greater, in fact inconceivably greater, than the amount 

 which would come to labour without the capital. The 

 author shows very clearly also, in a most interesting 

 chapter (Chapter xi.), that a vast amount of service is 

 rendered to the community which is unpaid, particu- 

 larly, in this country, the labour of men engaged in public 

 services, such as members of Parliament, municipal, 

 county and parish counsellors, magistrates, students, 

 explorers, managers of public institutions, and the like. 

 To these must be added the greatest unpaid service of 

 all, that of women in the household. The resources of 

 a community accordingly are not merely the paid 

 services which constitute the aggregate of the money 

 incomes, but those other services also by which the com- 

 munity benefits, although they are not paid for or 

 assessed in any way. 



The main point of the analysis, as it proceeds, is ap- 

 parently to be found in Chapter .\ii., in which it is 

 established that the money income is limited by the real 

 income, the two things being identical, and that in the 

 distribution of the real income an increase that goes to 

 one contributor means a deduction from all the other 

 contributors and vice Tcrsd. It follows from this also 

 that the total production of the community is the measure 

 of what can be distributed, and the only way in which 

 the community as a whole can advance is by an increase 

 of the total production or an improvement in quality. 



The author gives here a very good illustration, that 

 of a rich man's daughter, of whom the complaint is 

 sometimes made that by going into the labour market 

 and competing with working women who have to depend 

 upon their work for a livelihood she takes the bread out 

 of their mouths. 



"Let us suppose that she has been getting a dress 

 allowance of 30/. from her father, and that in view of her 

 making 12s. 6d. a week in typewriting he stops the 

 allowance. There is no difference to the girl e.xcept the 

 honest glow of independence. But what of the father.^ 



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