F.— ECONOMIC SCIENCE AND STATISTICS 153 



go far. In the absence of more precise quantitative knowledge we soon 

 run into alternative possibilities. 



This being so, the next step would appear to be to obtain more precise 

 knowledge. This must come from empirical investigation. But when we 

 leave the sure ground of the law of demand in its general form, we are at 

 once confronted with the appalling problems which the shift and change 

 in the economic scene with its plurality of causes and unamenability 

 to experiment present. Heroic attempts have been made by such workers 

 as Dr. Schultz to obtain quantitative laws of demand, and Prof. Douglas 

 has made assaults on other parts of the structure of equations. Interest- 

 ing results have been obtained and more are to be expected. 



If this is really the heart and centre of economic science, all our resources 

 should be put at the disposal of such investigations. But is it ? We come 

 back to the obiter dictum of Ricardo. Can it be justified ? 



It may be hazarded that there has been some concentration on the 

 development of this part of pure theory, precisely because to a certain 

 point it was possible to proceed by way of deduction from our demand 

 axiom. But when we proceed beyond this point it is necessary to make 

 hypotheses about alternative possibilities, and, although with the aid of 

 mathematical tools elaborate chains of deduction may be forged, the basis 

 remains hypothetical. It does not seem probable that the predictory 

 power in the theory of value can be enlarged, save by such empirical 

 observations as make it possible to fill in the blank-forms of equations 

 with quantitative data. 



This may be done. It should be noted that the results obtained will 

 at best not have a very high degree of probability. Yet it must be said 

 that if real equations could be substituted for the present empty forms, 

 even if the former were conjectural and hazardous in the extreme, economics 

 would be on its way to looking much more like a mature science than 

 it does at present. Only by abandoning the theological claim to cer- 

 tainty and explicitly allowing a wide margin of error can economics rebut 

 the charge of scholasticism and claim scientific status. 



To sum up. The adoption of individual preference as the criterion 

 for testing arrangements has proved convenient for getting a systematic 

 ordering of thought. Incompletely but validly formulated as the principle 

 that the marginal social net product of productive resources should be 

 equal, it may be used to test existing arrangements or proposals. A 

 map may be constructed, resembling our economic system, in which 

 individuals notify each other of their preferences. Interferences may be 

 condemned for not taking account of this map. Alternatively inter- 

 ferences may be recommended designed to make our economic system 

 resemble the map more closely. Both kinds of advice spring from and are 

 dependent on a vigilant observation of the actual working of our system. 

 It is highly important that this part of the economist's function should not 

 fall into desuetude. 



The causal laws of static theory are deducible from the law of demand. 

 This is well based on a very wide experience ; it is in no need of veri- 

 fication ; further attempts to verify it could not add to the assurance with 

 which we already hold it. But the laws are of a very general form and little 



