128 RATES AND TAXES 



The natural effect of this fall in net rental 

 is seen in the changes made in the uses of 

 land. Some land has gone out of cultivation, 

 and other land is much less highly cultivated. 

 Capital that does not yield a profit, or in 

 some cases does not provide against depre- 

 ciation, is not renewed. 



We see what a difference is made in the 

 popular view of incidence if we pay attention 

 to the nature of rent as actually received and 

 expended. A large part is quite different 

 from the economic rent of pure theory. And 

 it follows that a tax or a rate that falls 

 on this part must have the same effect as a 

 tax on any similar form of industrial profit. 



But at this point it must be observed that 

 the popular theory of incidence will no 

 longer hold good in the simple form as at 

 first stated. That theory only applies to the 

 pure economic rent, or at most in addition, 

 to the so-called quasi-rent on the fixed 



