Lectures on the theory of economics, by Frederick Charles Hicks .. by Hicks Frederick Charles 1863-

Author:Hicks, Frederick Charles, 1863- [from old catalog]
Language: eng
Format: epub
Publisher: Cincinnati, The Univerisity of Cincinnati press
Published: 1901-03-25T05:00:00+00:00

however, an individual and his possessions constitute but a part of the requisites for success in the effort to satisfy wants. Under such conditions, one's own efforts minister in part to his wants and in part to the wants of others; while others, in like manner, contribute to their wants and to his. In such a state of interdependence, one's prospect of success in the attempt to satisfy his wants and, therefore, his effective demand, depend not only upon what he produces, but also upon what others produce and upon what they demand. In the first instance, the individual uses the means at his disposal to produce a supply of commodities, more or less with a view to meeting the wants of others. This, his contribution to supply, is at the same time a factor in his ability to secure the products of others, /. e,, in his effective demand for what others have produced for themselves and for him. The baker's bread, the miner's coal, the weaver's cloth and the cobbler's shoes are for each his supply and at the same time a condition of his effective demand. But the product of each is but one factor in his effective demand, for the demand of each is effective only when he has found some one who in turn demands his commodity. The miner is hungry and has a general want for food. He learns that bread will satisfy this want and that a supply of bread is in the possession of the baker. The conditions of effective demand are met in part. There exists a general want and it has been specialized in so far as that requires a knowledge both that bread will sat-

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isfy the want and where bread can be found. But there is still something lacking. The miner offers his coal to the baker and finds that it meets the latter's want for fuel, and then there exists in the full economic sense a demand for bread. In like manner, starting from the baker with his general want for fuel directed towards coal, and his supply of bread in excess ^f his own final want therefor, which the miner desires, there can be traced an economic demand for coal.

The extensive use of a medium of exchange, which brings the consumer into relation with a middleman instead of with the original producers of commodities, obscures the interdependence of supply and demand. But a complete analysis of economic relations shows not only that a man's purchasing power is a necessary element in his demand, but that his purchasing power depends both upon his ability to produce something and also upon the adaptability of that which he produces to the wants of others and upon their demand for it. In no phase of the economic process is the mutuality of relations and the absolute necessity of unification of design to economic eflBciency, more apparent.

Moreover, to the extent that, through the development of division of function, ownership in

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