184 REPORT — 1873. 



The ohject of an endowment is always one of importance to the community, or 

 believed to he so. 



It is always an industry or employment. Institutions are only the means of 

 industry. 



The economical condition of the employment upon which endowment is spent 

 may be: — (1) self-supporting, or capable of being made so; (2) partly or tempo- 

 rarily incapable of maintaining itself; or (-S) wholly and permanently incapable. 



Political economy does not necessarily involve non-interference with the law of 

 supply and demand, but studies the effects both of interference and non-interference. 



What then are the effects of the interference with the action of supply and de- 

 mand involved in endowment in each of the three cases just mentioned ? 



1. Where the industry is self-supporting, or may be made so, it is to diminish 

 the amount of production of the particular industr}'. This is the main gTOund upon 

 which Adam Smith decides that the endowment of the higher education in uni- 

 versities is to be condemned. 



Criticism of his views — question whether secondary and university education are 

 or can be made self-supporting. 



Endowment running to waste where it is tmnecessary, affects also injuriously 

 general production. Delicate economical calculations may aiise out of this. 



2. Instances of partly self-supporting industries are primary education and tech- 

 nical education. 



Effect of partial endowment may be to stimulate production within the industry 

 endowed ; whereas without endowment it might fall to the ground altogether. 



Primary education is a condition of public security, and therefore of a healthy 

 economical state. 



Technical education, like improved machinery, directly increases the capacities 

 of producing wealth. 



It is probable, therefore, that the return of the outlay in partial endowment of 

 them will be greater than the diminution of wealth caused by the diversion from 

 self-supporting industries of the endowment fund. 



K pnmaiy or technical education ever became, by an alteration of the industrial 

 state of the country, self-supporting, the continued endowment of them would 

 then, as in the former case, involve a waste. 



It may be questioned also whether the effect of the "ladder of endowment," by 

 which persons are enabled to rise from lower to higher and the highest gi'ades of 

 education (however advantageous it may be politically to draw the elite of every 

 class in the community up to the top), is economically advantageous; for it tends 

 to draw off the best minds from particular industries, and thus to impair the power 

 inherent in the latter of improving themselves. The soundest economical condi- 

 tion, it may be contended, is when the best minds are distributed throughout the 

 community, and can act beneficially upon every form of production, instead of 

 being centralized in a single class. 



3. An industry is permanently incapable of supporting itself when the com- 

 modity which it produces is unsaleable. This is the case with original research in 

 science. 



Distinction of useful and liberal studies. 



Mill's statement that the labour of the savant is a part of production, and its en- 

 dowment a productive part of public expenditure, seems strictly to apply only to 

 those researches which render inventions and improvements of the means of pro- 

 duction .or distribution possible. 



Mr. George Gore's enumeration of these shows that they are mainly confined to 

 researches in Physics and Chemistry. 



The other physical sciences, such as Natural Histoiy, Botany, Ethnology, &c., 

 and the study of letters, of language, or of history, however important in themselves, 

 are not in the same sense industries which have any effect upon the increase of 

 wealth-producing power. 



They supply, it is true, the materials of education, which, as we have seen, is a 

 remunerative industry ; but science, of whatever kind, is essentially an end in itself, 

 and therefore not in the majority of cases or necessarily a commodity, i. e. means to 

 any thing else. 



I 



