PRESIDENTIAL ADDRESS. 585 
of production in order to meet them? How are desires related to one another? 
What are they likely to become? What are the limits to demand set by the 
economic situation of the demanders? These are the things we really want to 
know. The problem is, in a wide sense of the term, an historical one; or, if you 
prefer the phrase, a sociological one, both ‘static’ and ‘dynamic.’ Behind the work- 
man’s wife making up her mind on Saturday night whether to buy another loaf or 
a scrap more meat stand the whole of human nature and the whole of social 
history. And this is what, I suspect, the deeper thinkers among the Marginalists 
are obscurely realising. When Professor Marshall distinguishes between normal 
and market value, and invites us, in order to understand normal value, to 
contemplate a chain of forces operating, both on the demand and the supply side, 
for indefinitely long periods, is he not in substance recognising that the problem is 
one of age-long development ? And, similarly, when Professor Clark points out 
that even utility is not a homogeneous thing; that every commodity is really a 
bundle of utilities for different purposes; and that therefore ‘value is a social 
phenomenon,’ he is approaching the real complexity of a sociological problem. 
It is with a true instinct that Mr. Carver waives these subtleties of the Columbia 
economist on one side; he perceives that simplicity of economic ‘ analysis’ would 
speedily disappear if the psychology became more profound. 
When we pass from marginal utility to the exposition of the laws of distri- 
bution to which it serves as a prelude, the attempt to judge of the true character 
of the neo-abstract literature of recent days becomes extraordinarily difficult. 
For one who should try, as I have recently done, to review that literature as a 
whole will be startled to find how far-reaching are the divergences within it. 
Its only unity would seem to consist in a common belief in the value of abstract 
(or, as it is sometimes called, ‘ general’) reasoning, and in the common -employ- 
ment of a few specialised terms. Doubtless all the differences could be construed 
as differences of emphasis; but this is hardly reassuring, for the emphasis may 
differ so much as to give totally opposite impressions. A man may be ‘coloured’ 
with so little emphasis as to be practically white, or with so much emphasis as to 
be practically black. So long as the student keeps to a particular set of writings, 
he may cherish the impression of a triumphant analysis, solving all difficulties for 
intelligent men in the same way; when he extends his reading he will find that 
there are at least three main groups, following respectively the lead of Cambridge, 
of Vienna, and of New York; while among the younger men there are all sorts 
of ingenious but mutually irreconcilable attempts at eclectic compromise. 
The -want of agreement shows itself, I cannot help thinking, even before we 
turn to specific doctrines, when we ask ourselves what is supposed to be the 
relation of the several ‘systems’ to real life. It is the old difficulty, still giving 
trouble, of the relative importance of ‘tendency’ and ‘friction.’ Grant, if you 
will, the possibility of a doctrine of tendencies, it is surely of the first importance 
that we should have a pretty definite and continuous impression as to the width 
of the gap between the formule and visible phenomena. Yet, while some of the 
abstract economists give the impression that the tendencies they formulate are 
actually, with some little delay and in a rough-and-ready way, on the whole 
realising themselves in concrete circumstances, others give the impression that 
their science is so very ‘pure’ as to have hardly anything visibly in common 
with the crude doings of impure humanity. One leading writer assures us that 
in his book ‘normal action is taken to be that which may be expected, under 
certain conditions, from the members of an industrial group; and no attempt is 
made to exclude the influence of any motives, the action of which is regular, 
merely because they are altruistic.’ On the other hand, his persuasive American 
colleague turns our thoughts in just the opposite direction. He tells us that ‘ the 
impression of unreality which is made by the studies of the classical political 
economy is removed by completing them on the same theoretical plan on which 
they have been started. We must use assumptions boldly and advisedly, make 
labour and capital absolutely mobile, and let competition work in ideal perfection.’ 
There has been one fresh and welcome advance upon the position of the older 
writers. Both Professor Marshall and Professor Clark would seem to agree in 
