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obscure in its nature and too automatic or unconscious in its exercise to be of any practical advantage in explaining the social process. The natural man, unacquainted with economic literature, does not think in terms of marginal utility; he thinks in terms of total utility.

One other theoretical portion of the book shows a thoroughgoing revision. This is the subject of distribution. Chapter 9 in the original edition is hardly recognizable in chapter 11 of the latest revision, though the title, Production and Distribution, remains the same. The author has not modified his fundamental concepts, but has attempted to explain and illustrate them more fully by means of actual business operations. In so doing he avoids the artificial separation which many writers have made between production and distribution; but it is a question whether pedagogic purposes would not be quite as well served by such a separation of economic functions as they are by the equally artificial assumption of a "state of normal equilibrium" to which the author is obliged to resort in order to simplify his task. Whatever the advantages or disadvantages of the author's method of treatment may be, there is no doubt that he has made a very substantial improvement in the matter of exposition.

What has been said of distribution in general applies as well to the author's discussion of competitive profits, monopoly profits, rents, wages, and interest. He has made a number of changes in method or style of presentation, but holds to the same general thesis, namely, that each factor in production tends to secure a share corresponding to what it itself produces. Strictly speaking, of course, this applies to profits only in so far as they merely equal wages of management. Competitive profits in excess of this amount, due to changes of various sorts, and monopoly profits are not, in this sense, earned, and must therefore be regarded as an indication of the extent to which economic tendencies fall short of attaining their goal in the actual business world.

The new edition is distinctly superior to the earlier editions in completeness and in clearness of exposition. There has been a marked improvement in typography, and the changes and additions have been made without materially increasing the size of the volume.

Massachusetts Institute of Technology.


Materials for the Study of Elementary Economics. Edited by LEON CARROLL MARSHALL, CHESTER WHITNEY WRIGHT, and JAMES ALFRED FIELD. (Chicago: The University of Chicago Press. 1913. Pp. xvii, 927. $2.75.)

In the last few years discontent has been evident among teachers of economics over at least two matters, namely, the point of view and emphasis prevalent in the subject-matter and the pedagogical methods in use. Widespread interest among American economists in the development of the marginal utility theory and its application to various problems had resulted in undue stress upon marginal theories in textbook and in teaching. While gaining in precision of explanation and scientific statement, economics seemed to be out of touch with the ordinary business of life. Concrete problems were replaced by hypothetical ones of great ingenuity calling for keenness in abstract thinking or in the application of mathematics. The disciplinary value of economic study was undeniable, but the question arose whether equal educational results might not be secured by considering problems that would seem to the student more vital.

On the other hand, the methods used in undergraduate teaching of economics were largely a mere transfer to this field of those forms of instruction with which the college professor had become familiar in his graduate study. Lectures of the German university type, special topics following a long way after the graduate thesis, occasional oral quizzes for detective purposes, were too frequently the pedagogical stock in trade of the college teacher of economics. To a certain extent these conditions were the inevitable result of the inadequacy of teaching force due to the sudden expansion in department enrollment, since the contemporary interest in social problems brought many students to the class room despite the doctrinaire treatment and the dullness of the class hour.

Some of the more recently published American textbooks and larger treatises, while accepting and incorporating the valuable part of modern theorizing, reveal more balance and proportion in treatment, and a return to reality. Contemporaneously there has been much thought about better methods. Fewer lectures and those of a different type; the use of the "recitation" as a means of cultivating independence of thought rather than as a recital of imparted knowledge; problems in class and for out-ofclass solution; extensive reading and intensive thinking-these

have been some of the tendencies. Conferences and symposia in the journals have allowed exchange of teaching experience. The members of the department of political economy of the University of Chicago have been leaders in this movement and two or three years ago published Outlines of Economics, aiming at a more inductive method of developing elementary principles. They have now published an extensive collection of materials for use in elementary classes. While the source book in economics is not new, it may be said without much fear of contradiction that the present volume is larger in amount, more extensive in range, and more useful in character, than anything yet printed in English and probably in any language.

From all sorts of sources have been selected "expository and descriptive readings, statutes, judicial decisions, the findings of commissions, news reports, statistical tables, schematic analyses, and a number of maps, charts and diagrams." Out of the 267 selections the reviewer has not found one that might not be useful in class work. Suspicion that some of the extracts might be too difficult for elementary classes is allayed by the compilers' statement that all have been tested in actual class-room experiment. There would be doubt in the minds of some teachers regarding the inclusion in elementary courses of certain topics, but the same doubt would arise about the content of most textbooks. There seem to be a few important topics not illustrated. While there are many selections bearing upon the large corporation charter and system of organization, there is nothing upon the relative advantages of different-sized business units under differing conditions of market and customer. Certainly room might have been found for some of the other brilliant passages setting forth popular fallacies regarding consumption, if Bastiat's fable were deemed too hackneyed. Differences in efficiencies of laborers and more of the social reactions upon individual efficiency could easily have been illustrated; but space had its limitations.

While particularly useful for teachers of economics who are trying more inductive pedagogical methods, the Materials are the best available illustrative reading for ordinary lectures or textbook courses. Even the economist who is widely read and of long experience in teaching will find much that is helpful and even fascinating in these selections. The compilers have rendered a great service to the teaching of economics.

Vassar College.


Kapital und Kapitalzins. Zweite Abteilung: Positive Theorie des Kapitales. By EUGEN VON BOEHM-BAWERK. Third edition. (Innsbruck: Verband der Wagner'schen Universitäts-Buchhandlung. 1912. Pp. viii, 760. 21 M.)

With the volume under review Professor Böhm-Bawerk has completed the revision of his epoch-making Kapital und Kapitalzins. The text of this volume parallels that of Book III in the earlier editions of the Positive Theorie des Kapitales (Books IVVII in Smart's translation). What we have, therefore, in this new form is Böhm-Bawerk's exposition of the theory of value and price and of the theory of interest. That the author has undertaken the task of revision in no perfunctory spirit is attested by the fact that the 333 pages of the second edition are now expanded to 460 pages of text and 300 pages of excursus. There is scarcely any part of the work in which the exposition has not undergone substantial modification.

A large proportion of the literature on interest during the last two decades has centered in Böhm-Bawerk's theory. It may fairly he said that a primary classification of economic theorists is based upon the acceptance or rejection of Böhm-Bawerk's interest doctrine. His theory of value and price does not present so many strikingly individual traits. None the less, his formulation is in many respects the ripest work of the so-called psychological school of value theorists, and has served more frequently than has any other to illustrate the merits and the defects of the work of this school. Professor Böhm-Bawerk's frequent contributions to the periodical literature of economics has offered sufficient evidence that he has allowed little of the vast volume of criticism to escape him. Accordingly, it is with keen interest that the reader examines this final statement of Böhm-Bawerk's doctrines to ascertain how far the master has found it necessary to modify his original views.

In its essentials the author's system has remained unchanged. At many points the forms of expression have become less dogmatic, but this is frequently through the restoration of the text of the Grundzügen der Theorie des wirtschaftlichen Güterwerts, which had been presented in abbreviated form in the first edition of the Positive Theorie. In a less talented author the infrequency of substantial modifications might be ascribed to crystallization of thought. The new material in the present work, however,

displays the same logical power and vigor of expression that characterized the author's earlier work. The present volume. may therefore be taken as evidence that the Positive Theorie, as we first learned to know it, was essentially a closed system. Even so great a mind as that of Böhm-Bawerk has not been able, in twenty years, to deduce new truth from its presuppositions. Criticism of Böhm-Bawerk's value system has not, indeed, been confined to a questioning of his presuppositions. The logic of his treatment of the relation of value to cost was once violently attacked, and it cannot be said that the assailants have even yet retired from the field. Marshall's doctrine of the reciprocal relation of value and costs has still many adherents; so also has the cost doctrine of Dietzel. In Excursus VIII, on Wert und Kosten, Böhm-Bawerk ably defends his position against the attacks of these writers, and against criticisms of Schumpeter having the same trend. The reader who holds no brief for the English classical school will regard Böhm-Bawerk's logic as conclusive. His imputation theory, also, has been attacked by those who accept the principle that some theory of imputation is absolutely indispensable. Wieser's strictures upon Böhm-Bawerk's method are familiar to all students of economic theory. That Wieser's point was not well taken has been shown by other scholars, but perhaps nowhere more conclusively than in Excursus VII of the present volume, entitled Theorie der Zurechnung. The hedonistic terminology of Böhm-Bawerk's value theory has also given occasion to an extensive volume of criticism. To meet this criticism our author attaches to his discussion of value a chapter entitled Psychologisches Nachwort zur Werttheorie, in which he shows that psychological hedonism is no part of the assumptions of his theory. "Utility" and "welfare" are to be interpreted broadly enough to cover anything men consider worth striving for.

To an American student of theory, the most interesting part of the present work is the attempt to meet the criticism of Fisher on the relation of productivity, or the "technical superiority of present goods," to the rate of interest. According to Fisher's doctrine, undervaluation of the future, rational or irrational, and differences in the provision for present and future, are alone sufficient to explain the rate of interest; the facts of technical productivity have no bearing here. Böhm-Bawerk admits (Excursus XII) that in the absence of the elements upon which

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