TRANSACTIONS OP SECTION F. 733 



of industry and commerce to-day, I fear I may be charged with misrepresenting 

 the work of recent economists. To this charge I am ready to plead guilty at once ; 

 I think it very likely I liave misrepresented them, and I am extremely sorry for it, 

 for I have not done it carelessly or deliberately — -I have sedulously endeavoured to 

 avoid it. The fault lies not with me, but with writers who, when they leave their 

 studies and translate their formulie into the language of common life, forget that 

 they have to do with stupid people ; they claim a liberty to alter their definitions 

 from time to time as the e.xigencies of their argument shall require, and they do 

 not take sufficient pains to state clearly and fully what their assumptions are. 

 Despite my best endeavours I may not always succeed in following them and 

 reconciling their apparent inconsistencies. Ricardo, as Professor Marshall excel- 

 lently says,' made ' the great error of taking for granted that his readers would supply 

 those conditions that were present to his own mind.' ' He changes from one 

 hypothesis to another without giving notice.' And this brings me to the second 

 point on which an historian may be inclined to insist : that since human nature and 

 institutions chanxje so much, it is most important that our hypotheses regarding 

 them should be stated f idly and clearly. Unless we do so we are not able to keep 

 quite clearly before us the limits within which our arguments are applicable to- 

 actual life ; but when our hypotheses are clearly stated, we can see directly how 

 far our reasoning is irrelevant to some past condition of society, or how far it would 

 become inapplicable if human nature were to change for the better. Just because 

 economic reasoning is hypothetical and the results are universal in form, hasty 

 readers are apt to forget the comparatively narrow area and short time of actual 

 life to which any single hypothesis is really appropri.ite, and the limits within 

 which economic generalisations are approximately true ; there is a constant 

 tendency to the undue extension of principles that have universal validity, as if 

 they had therefore a wide range of applicability. By clearly stating our hypotheses, 

 we may secure all the advantages which accrue from modern economic science and 

 push the refinements of theory much farther, while we shall keep well before us the 

 hypothetical character and limited applicability of our conclusions, so that we- 

 need fear no apparent conflict either with the facts furnished by history or with 

 the ideals which moralists may be endeavouring to realise. 



Ricardo, Senior, and some of those who have followed them, have not been 

 careful to state exactly what they assumed. This neglect was often verj' excusable 

 in Ricardo, especially when he assumed things that were prominent and well- 

 known features in the economic conditions of his day. He did not feel called upon 

 to state some assumption, because it was so clear to common sense that it did not 

 seem worth while to put it on paper. But if there is any lesson that history 

 teaches us, it is that nothing is so well known that we can assume it 

 will always be well known and does not need to be explained. William 

 the Conqueror framed an elaborate scheme for the taxation of England, and 

 recorded the results in ' Domesday Book.' He said that every place was to 

 pay according to hides. This place was rated at so many hides and that other at 

 80 many more or less. But what was a hide ? He did not think it necessary to 

 state that, because it was obviously a thing that everybody knew ; in the course 

 of time it came to be a thing that everybody had forgotten, and the precise mean- 

 ing of which is being gradually recovered. But William the Conqueror could 

 hardly be expected to foresee all that, or to know that, in the interests of historical 

 research, he ought to have given a plain definition of the everyday language 

 which he used. 



In much the same way Ricardo could not be expected to foresee that within 

 half a century after he wrote there would be an extraordinary agricultural revo- 

 lution ; he lived before the days of thorough draining, when high farming was 

 still in an experimental stage ; in his time English agriculture was still mainly 

 extensive. If prices promised well the farmer would plough more ground and 

 bring a larger area under crop ; if prices ruled low the worst land would go out of 

 cultivation. There were many fields which were actually on the margin of 



' Principles, 213, 530. 



