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SCIEN^CE. 



[Vol. VIII., No. 181 



as patriotism, charity, and custom. Again, com- 

 mon sense revolted against the assumption that 

 these theories were universal and perpetual ; that 

 is, true everywhere and at all times. Experience 

 showed that at different epochs in civilization, 

 and among differently situated nations at the 

 present time, the premises would require very 

 great modifications. 



The new method in political economy is induc- 

 tive ; that is, it proceeds from observation of facts 

 to general rules and principles. It carefully ob- 

 serves the limits of time and place, and abstains 

 from asserting its principles to be either universal 

 or perpetual. It makes use of what knowledge 

 we have of man and nature ; but it uses this 

 knowledge for the purpose of guiding and help- 

 ing its investigations, not as a priori premises. It 

 studies history for the purpose of discovering what 

 blunders men and nations have made in their 

 economic experience, and how those blunders 

 may be avoided in the future. The inductive 

 method is also comparative ; that is, it compares 

 economic institutions performing the same 

 function among different nations of the same 

 degree of civilization, in order to discover which 

 is the best. The method is, finally, statistical ; that 

 is, it collects statistical data as a basis for its 

 knowledge, in order to measure economic forces 

 and gauge the results of economic action. The 

 present method of political economy as recognized 

 by the greatest modern economists, such as 

 Wagner, SchmoUer, Leslie, Jevons, Marshall, etc., 

 is historical, comparative, and statistical. 



I do not propose to defend this new method 

 against the old, much less to vindicate it. Neither 

 do I deny that the old method has had able repre- 

 sentatives, and that in its time it has done good 

 service. All I assert is, that it is now practically 

 abandoned as a method by itself, and that the 

 future of political economy depends upon the 

 scientific application of the new method to the 

 complex phenomena of modern civilization. 



It will be useful, however, to describe more 

 fully how the new method is actually applied, 

 what sort of results it is able to give us, and some 

 of the advantages which flow from its use. I 

 propose, therefore, to discuss, 1°, how to investi- 

 gate particular economic problems; 2°, how to" 

 reach general principles of economic life ; 3°, 

 what are the collateral advantages of this method ; 

 and, 4°, how to make method and results useful in 

 the study of other social sciences and in guiding 

 state action in economic affairs. 



How to investigate particular economic problems. 

 Every reader of John Stuart Mill will remem- 

 ber the opening paragraph of his ' Principles of 



political economy:' "In every department of 

 human affairs, practice long precedes science; 

 systematic inquiry into the modes of action of 

 the powers of natm-e is the tardy product of a 

 long course of efforts to use those powers for 

 practical ends. The conception, accordingly, of 

 political economy as a branch of science, is ex- 

 tremely modern ; but the subject with which its 

 inqunies are conversant has in all ages necessarily 

 constituted one of the chief practical interests of 

 mankind, and, in some, a most unduly engrossing 

 one." 



In the same way it might be said that the solu- 

 tion of economic problems precedes the formula- 

 tion of an economic science. Mankind has 

 always had its economic problems, and philosophic 

 heads have ever busied themselves trying to solve 

 them. The method of doing this is both of very 

 gi'eat importance in itself, and indicative of the 

 character of the science which will by and by 

 be formulated on the basis of this method. It 

 will be of interest, therefore, to show how the 

 inductive method of political economy attacks 

 practical economic problems, and to see what sort 

 of a science results from this method. In choos- 

 ing my illustrations, I have purposely selected 

 modern economic questions, and American and 

 English authors, in order to escape the common 

 slur that this method is fitted only for the anti- 

 quarian, and used only by learned but unpracti- 

 cal and idealistic German professors. 



Mr. Sidgwick has remarked, that, in that por- 

 tion of political economy dealing with the pro- 

 duction of wealth, the inductive and analytical 

 method has been much more used than in those 

 portions dealing with exchange and distribution. 

 Take, for instance, the question of land-tenure, — 

 one which has interested political economy for a 

 long time, and which is to-day one of the burning 

 political questions in England. It is apjiarent at 

 a glance that the method of holding land must 

 have a great influence on its productiveness. We 

 can even reason a priori that where there is abso- 

 lute pro])rietorship on the part of the cultivator, 

 or at least a long leasehold which will secure to 

 him the reward of his labor, he will be apt to 

 work harder, and that the gross produce will 

 thereby be increased. But the English econo- 

 mists, even MiU, Thornton, and Faw'cett, have 

 approached the subject in a different way. They 

 have studied the condition of the French and 

 Belgian peasants where absolute ownership exists, 

 and have pointed out the prosperous condition of 

 these countries as the proof that peasant proprietor- 

 ship is the best system. This is the pure com- 

 parative method in political economy. 



Let us take a more specific question. The issue 



