ning been preached, things could not acquire value, a view, however, which was gradually dispelled and replaced by the more logical one that what counts is not a physical change in external objects, but an attitude on the part of human beings. Scarcity therefore was found more decisive than energy previously spent, and this could mean nothing less than establishing a ratio between wants of people and the supplies on hand. That things useful would become the more valuable the less there was of them, was consequently understood at an early date, the comments of the Earl of Lauderdale on this subject being the prototype of most things said since. A paradox thus hove into view which it might take time to explain, but the reality of which none could deny. And as to this question of utility itself, the first step was a ruthless overriding of moral conceptions. In discussing values the problem of ultimate values was to be left out. It was nobody's business whether values satisfied theological or ethical norms or not. For the Utilitarians in the narrower sense economic and "higher" value was one; for others the stress was on a separation that should leave science untrammeled. Hence things were useful if they served to satisfy wants. The capacity of anything, whether tangible or not, to gratify any want whatsoever, was the proof of its being useful. As J. S. Mill observed in his "Principles of Political Economy," 1848: "Political Economy has nothing to do with the comparative estimation of different uses in the judgment of a philosopher or of a moralist. The use of a thing

means its capacity to satisfy a desire, or serve a purpose." 36 Now, given utility and scarcity, or simply labor embodied in an object, or our right to exchange such objects, the definition of value is easy. Namely, it is

30 Book III, ch. 1, § 2.

"the command which the possession of a thing gives over purchaseable commodities in general.” 37 Value represents a relation between a person and something external to him, but it also expresses a relation between two or more articles measurable by the rate at which they are exchanged. Either one may serve as a unit for measurement. The customary one is a piece of currency, a standard legally defined, in which case we speak of money and price respectively. But it is not necessary that the exchange ratio be so reckoned. In barter the exchange is necessarily at a certain rate too; and here the value of the things exchanged is revealed. The market ratio increasingly received people's attention, the idea of a "natural" value being dropped as of no bearing on the main subject. Besides, there was an ethical element in the "natural" price that Utilitarianism could not approve of without jeopardizing its position.

However, it was granted that individual and social viewpoints might go far apart, and so from Lauderdale up to the present the definition of wealth has proven an apple of discord. For, strictly speaking, wealth had to be defined as "everything which has a power of purchasing"; but though this agreed well with the theory of an "economic man" and the delimitation of economics in utilitarian style, it occasioned much speculation as to the relation of national to individual wealth. The difference was soon noticed and courageously expounded. The Ear! of Lauderdale once more set an example. John Rae in 1834 in America, and McCulloch and Torrens in England made much of the distinction, the hope being now to give economics a moral setting, now to accentuate the scien

37 Ibidem. See also Pantaleoni, M. Principles of Pure Economics (translated from the Italian by Bruce, T. B., 1898), ch. 4. For a classification of definitions of price see Fetter's article in American Economic Review, vol. II, 1912.