PRESIDENTIAL ADDRESS. 463 
vigour of the people themselves, there are other causes which lend it strength : 
in the present instance, there is, on the one hand, the feeling that they can 
afford the experiment; on the other, the resolve to avoid, though the cost may 
be considerable and the risk great, the difficulties and dangers with which older 
nations are confronted. Even if the whole course is not clear, they would fain 
steer clear of the rocks and shoals which are charted. 
Influences like these imply experimental legislation. Now, in a sense, most 
economic legislation is experimental; unforeseen results occur, and alteration, 
amendment, or repeal is required; but the extent to which it is experimental is 
certainly greater when we turn from the record of the past to the recent efforts 
of new communities. Reasons for this have been adduced, which may be briefly 
summarised, though in a somewhat different form. As compared with con- 
temporary nations of a more complex type, new nations are more prone to 
engage in experimental legislation for three reasons: firstly, because things are 
simpler, and in a less highly organised society there is less prospect of inter- 
- fering with a system which after all works, even if not to complete satisfaction ; 
secondly, the consciousness of latent resources creates a greater readiness to take 
risks, owing to the general feeling that they can be afforded; and lastly, it is 
recognised that industrial civilisation carries in its train certain dangers which 
can be more easily anticipated than remedied. The case is a little different when 
the comparison is instituted with countries in the primary phase of economic life 
in the more remote past. Here the predominant reasons are also three. There 
is greater self-consciousness accompanied by a knowledge of possibilities and 
risks. Again, in the modern country, law is to a greater extent a conscious 
act and to a less extent a crystallisation of custom. Lastly, the movement of 
economic life and the greater rapidity of progress make other and further 
changes sometimes actually necessary and always less an occasion for hesitation 
or anxiety. 
Still, a people encountering changes so rapid and sudden, and engaged in 
legislation experimental to such an extent, should look carefully to their armoury. 
Action or legislation in the economic and industrial domain, to be sound and 
effective, must observe certain conditions. The action of the State varies 
in its consequences with the relations between the people and the Government. 
A State which imposes law or exercises control as it were from the outside, 
acting autocratically or without any real identification of the private with the 
public will, encounters certain dangers. The essence of law lies in its ready 
acceptance, and this is peculiarly true of laws in the economic sphere which 
touch the social and home life and activities of the people. Now, any real 
feeling of community of interest between the people and the executive implies 
much more than mere popular election on however democratic a basis. It means 
a sense of participation in the acts of the executive, and involves a recognition 
of obligations as well as rights. To some extent, no doubt, this is furnished 
by high ideals in public life, but probably its surest basis lies in the partici- 
pation by individuals in some form of public administrative action. The saying 
that the strength of England lay in its local institutions means even more than 
was intended at the time. Voluntary service in local government is to be 
valued not only for what it achieves, but because it quickens the interest in 
the State, and, if widely shared in, begets in the community an enlightened 
knowledge of the problems and methods of government. Again, State action, 
to reap a fruitful harvest, must be based on knowledge; and here I touch on 
a topic which deserves more time than is at my disposal—namely, the importance 
in such countries of economic study and the methods whick this snould 
follow. It is precisely amidst surroundings where the mass of new data is 
great that the need is greatest for scientific method in the examination of such 
data and in their comparison with the phenomena existing in other countries. 
Economie theory and systematic economics form part, but only part, of the 
necessary equipment of the modern economist, and their function is not infre- 
quently misunderstood, and stands in need of clear definition. They indicate the 
relations which, so far as our present knowledge goes, exist between different 
classes of phenomena, and especially between these in respect of cause and 
effect. They place at the disposal of the student a keen instrument and a means 
of fine analysis which enable him to classify and co-ordinate new data, to com- 
pare these with other data, and to avoid the fallacies and misconceptions which 
