Principles of economics by Taylor Fred Manville 1855-

Author:Taylor, Fred Manville, 1855- [from old catalog]
Language: eng
Format: epub, pdf
Tags: Economics
Publisher: Ann Arbor, University of Michigan
Published: 1913-03-25T05:00:00+00:00

(2) It will perhaps occur to the student that, if the signi-fi-cances expressed by demand prices are so entirely lacking in I homogeneity, it will hardly pay to use these concepts at all in | connection with general demand schedules, however useful they / may be in connection with individual demiand schedules. In fact, / not a few economists have in recent years taken this position. In / the present course, however, we shall act upon the contrary opin- I ion;—-that is, we shall set forth the influence upon normal price / of significances or utilities as represented in our composite demand / schedules, as if these significances were factors of real impor- I tance in the determination of prices. The defence of this position / however will be postponed to a later connection. Here we shall / work out the merely formal relation involved, assuming that the / results can be shown to be useful at a later time.

I will now close this long discussion of normal demand schedules with a statement in respect to the general character of such schedules, which is of much practical importance. It is this, Broadly speaking, substantially all general demand schedules are of the kind which in the last chapter were characterised as typical, —that is, over a wide range of prices, these schedules show fairly uniform changes in demand with substantially every material change in price. In other words, these schedules are highly regular and symmetrical. Doubtless this must be affirmed less roundly of some than of others. A few are relatively inelastic, e. g., those of the prime necessaries of life; but even these are by no means absolutely unresponsive to the influence of price changes. This fact about general demand schedules is an inevitable result of the conditions involved, (i) Such schedules are composites made up of numberless individual schedules. (2) Tfhe tastes and wants of individuals differ greatly. (3) Most of all, the incomes of individuals are very unequal. As a result of these conditions, there will be some effective demand at almost every price level. Even at very high levels, those who are rich and wish the commodity in question intensely will continue to demand it; w<hile, witih each fall in price, some persons who care less or have smaller incomes or who fulfil both conditions will come in with a new demand. The general schedule as whole, therefore, will s1k>w a high degree of continuity, regularity, and symmetry.

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PRINCIPLES OF ECONOMICS

Section D. Normal Price of Fixed-Supply Goods.

We have now the data necessary to enable us to bring out the deeper principles regulating the long-time or normal prices of things. Let us begin with the general case of fixed-supply goods. As an exaftiple, we will take copies of the Basel edition of Sir Thomas More's Utopia. Let us suppose that, at about the same time in the year 1913, three or four different finds are made bringing on the market a new supply of these books amounting to ten copies.

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