All material goods (Sachgüter) are of use to mankind through the
action of the natural powers that reside in them. They are a part of the
material world, and for that reason all their working, including their useful
working, must bear the character that working generally has in the material
world; it is a working of natural powers according to natural laws. What
distinguishes the working of material goods from the working of other
kinds of natural things, harmless or hurtful, is the single
circumstance, that the results of such working admit of being directed
towards the advantage of man, this direction also being under the rule of
natural laws. That is to say, all things are endowed simply with working
natural powers, but experience shows that these powers only admit of being
directed to a definitely useful end, when the matter which possesses these
powers has taken on certain forms that are favorable to them being so
directed. All matter on the surface of the earth, for instance, among other
forms of energy, possesses an amount of energy corresponding to its distance
from the centre of the earth. But while men can do nothing with this form of
energy when stored up in a mountain, that same energy is useful to them when
the matter possessing it has taken on some form they wish — that is, some
form in which the energy is available; say, that of a clock pendulum, or a
paper weight, or a hammer. The energy of chemical affinity which carbon
possesses is identical in every molecule of it. We get a direct economic
utility, however, from the results of this energy only when the carbon has
taken such forms as that of wood or coal; not when it exists as part of one
of the constituents of the air. We may therefore say that the nature of
material goods, as opposed to those material things that are
not useful, is that they are such special forms of matter as admit of the
natural powers they possess being directed to the advantage of man.
From this follow two important inferences, of which one concerns the
character of the useful functions of material goods, and the other concerns
the character of the use (Gebrauch) of goods.
The function of goods can consist in nothing else than in a giving off, or
rendering up, or putting forth of power; or, to use the terminology of
physical science, the passing of energy into work. On the natural side it
shows a complete parallelism with the character of the useful function
performed by a manual laborer. In the same way as a porter or a navvy is of
use, when he puts forth the natural power residing in his body in the form of
rendering useful services, so are material goods of use through concrete
forthputting of the natural powers inherent in them and capable of direction
— physically speaking, through the forthputting in work of the available
forms of energy they possess. It is by the passing of available energy into
work that the "use" of goods is obtained by man.[1]
The use (Gebrauch) of a thing then is realized in this way: man
takes the peculiar forms of energy of the good at the proper time, supplies
the conditions necessary to render them available where they previously
existed in an unavailable form, and then brings these forms of energy into
proper connection with that object in which the useful effect is to take
place. For instance, in order to "use" the locomotive the stoker
fills the boiler with water, applies heat, and thus obtains in an available
form the heat energy of the steam, which is transferred into energy of motion
of the locomotive. This last-named energy is then transferred by connection
to the carriages that convey persons or goods. Or one brings a book into the
necessary relation with his eye for the image, which is continually being
formed by reflection, to fall on the retina; or brings the house which
continually offers shelter into proper relation with his whole person. But
any "use" of material goods which does not consist in the receiving
from them of useful results due to their inherent powers or forms of energy,
is absolutely unthinkable.
I think I need have no fear of the propositions I have just advanced
meeting with any scientific opposition. The conception laid down is no longer
strange in our economic literature;[2]
and in the present state of the natural sciences the acceptance of it has
indeed become a peremptory necessity. If by any chance it should be objected
that this conception is one that belongs to the natural sciences and is not
an economic one, I answer that in these questions economic science must leave
the last word to natural science. The principle of the unity of all science
demands it. Economic science does not explain the facts that belong to its
province to the very bottom, any more than any other science does. It solves
only one portion of the causal connection that binds together the phenomena
of things, and leaves it to other sciences to carry the explanation farther.
Not to mention other limiting sciences, the sphere of economic explanation
lies between the sphere of psychological explanation on the one hand, and
that of the natural sciences on the other. To give a concrete example.
Economic science will explain thus far the circumstance that bread has an
exchange value: it will point out that bread is able to satisfy the want of
sustenance, and that men have a tendency to ensure the satisfaction of their
wants, if necessary by making a sacrifice. But that men have this tendency,
and why they have it, is not explained by economic science but by psychology.
To explain that men want sustenance and why, falls within the domain of
physiology. Finally, it also falls within the sphere of physiology to explain
that bread is able to satisfy that want, and why it is able to do so, but
physiology does not finish the explanation within its own sphere; it has to
call in assistance from the more general physical sciences.
Now it is clear that all explanations given by economic science have a
value only under this condition, that they are continuous with the related
sciences. The explanations of economics cannot rest on anything that a
science related to it is bound to declare untrue or impossible; otherwise the
thread of the explanation is broken from the first. It must on that account
keep exactly in touch with the related sciences at the points where they
limit it, and one such point is just this question as to the working of
material goods.
The one thing of which I have, perhaps, some reason to be afraid is, that
the employment of this physical conception in regard to a certain limited
class of material goods, especially to the so-called "ideal goods,"
may be somewhat startling at the first glance to some readers. That, e.g. a
fixed and stationary dwelling-house, a volume of poems, or a picture of
Raphael should be of use to us through the forthputting of inherent
properties connected with one or other of the forms of energy, or, as we may
shortly express it, the forthputting of its natural powers, may at first, I
admit, be a little strange. Objections like these, however, which have their
origin more in feeling than in understanding, may be removed by a single
consideration. All the things that I have named enter into the relation which
makes them "goods" only in virtue of the peculiar natural powers
which they possess, and possess, indeed, in peculiar combination. That a
house shelters and warms, is nothing else than a result of the forces of
gravity, cohesion, and resistance, of impenetrability, of the non-conducting-quality
of building materials. That the thoughts and feelings of the poet reproduce
themselves in us is mediated, in a directly physical way, by light, color,
and form of written characters; and it is this physical part of the mediation
which is the office of the book. There must of course have been a poet soul
in whom ideas and feelings waked, and, again, it is only in a spirit and
through spiritual forces that they can be reawakened; but the way of spirit
to spirit lies some little distance through the natural world, and over this
distance even the spiritual must make use of the vehicle of natural powers.
Such a natural vehicle is the book, the picture, the spoken word. Of
themselves they give only a physical suggestion, nothing more; the spiritual
we give of our own on accepting the suggestion; and if we are not prepared
beforehand for a profitable acceptance of it — if we cannot read, or,
reading, cannot understand, or cannot feel — it remains simply a physical
suggestion.
With these explanations perhaps I may consider it established beyond
question that material goods exert their economical use through the
forthputting of the natural powers residing in them.
The individual useful forthputtings of natural powers that are obtainable
from material goods I propose to designate as "Material Services."[3] In itself, indeed, the word Use (Nutzung)
would not be inappropriate, but to adopt it would be to surrender our
conception to all the obscurity that now, unfortunately, hangs over that
ambiguous expression.[4]
The conception of material services is, in my opinion, destined to be one
of the most important elementary conceptions in economic theory. In
importance it does not come behind the conception of the economic good.[5] Unfortunately up till now it has
received little attention and little development. From the nature of our task
it is indispensable that we should repair this neglect, and follow out some
of the more important relations into which the material services enter in
economic life.
First of all, it is clear that everything which would lay claim to the
name of a "good"must be capable of rendering material services, and
that, with the exhausting of this capability, it ceases to have the quality
of a good; it falls out of the circle of "goods" back into the
circle of simple "things." An exhaustion of this capability must
not be thought of as an exhaustion of the capability to exert or to put forth
energy in general; for what we have called the "natural powers "of
the material are as imperishable as the material itself. But although these
powers or forms of energy never cease to exist in some form or other, they
may very well cease to be available for material services in this way, that
the original good, in the course of doing work, has undergone such a change —
be it separation, dislocation, or uniting of its parts with other bodies —
that, in its changed form, its energy is no longer available for human use.
For instance, when the carbon of the wood burned in the blast furnace has
combined with oxygen in the combustion process, its powers cannot again be
employed to smelt iron, although these powers are constant, and continue to
work according to natural laws. The broken pendulum retains its energy due to
gravity just as it did before, but the loss of the pendulum form does not
allow of this energy being directed to regulate the clock. The exhaustion of
capability to render material services we are accustomed to call the using up
or consumption of goods.
While all goods thus agree and must agree in this, that they have to
render material services, they differ essentially from one another in the
number of services that they have to render. On this rests the familiar division
of goods into perishable and nonperishable, or better, into perishable and
durable.[6] Many goods are of such a
nature that, to render the uses peculiar to them, they must give forth their
whole power, as it were, at a blow, in one more or less intense service, so
that their first use quite exhausts their capability of service, and is their
consumption. These are the so-called perishable goods, such as food,
gunpowder, fuel, etc. Other goods, again, are, in their nature, capable of
rendering a number of material services in the way of giving off these
services successively, within a shorter or longer period of time; and thus
after a first, or even after many acts of use, they may retain their
capability of rendering further services, and so retain their character of
goods. These are the durable goods, such as clothing, houses, tools, precious
stones, land, etc.
Where a good successively gives off a number of material services, it may
do so in one of two ways: either the services following each other evidently
separate themselves from each other, as clearly marked single acts, in such a
way that they are easily distinguished, limited, and counted — as, e.g. the
single blows of a coining press, or the operations of the automatic printing
press of a great newspaper; or they issue from the goods in unbroken, similar
continuance — as, e.g. the shelter silently given over long periods of time
by a dwelling-house. If, however, it is desired, in cases of this sort, to
separate and divide the continuous amount of services — and practical need
often requires this — the expedient is adopted that is generally taken in the
dividing of continuous quantities; the dividing line that does not suggest
itself in the phenomena under consideration is borrowed from some outside
circumstance, e.g. from the lapse of a definite time; as when one delivers
over to the hirer of a house the services to be rendered by the house during
the year.
Another essential feature that meets us in the analysis of material
services is their capability of obtaining complete economical independence.
The source of this phenomenon is that in very many, indeed in most cases, the
satisfaction of a concrete human want does not demand the exhaustion of the
entire useful content of a good, but only the rendering of a single material
service. In virtue of this the single service in the first instance obtains
an independent importance as regards the satisfaction of our wants, and then
in practical economic life this independence is fully recognized. We give the
recognition (1) wherever we make an independent estimate of the value of
isolated services; and (2) wherever we make them into independent objects of
business transactions. This latter happens when we sell or exchange single services,
or groups of services, apart from the goods from which they proceed.
Economical custom and law have created a number of forms in which this is
effectuated. Among the most important of these I may name the relations of
tenancy, of hire, and of the old commodatum;[7] further, the institution of easements, of fee farm, of
copyhold (emphyteusis and superficies). A little consideration
will convince us that, as a fact, all these forms of transaction agree in
this, that one portion of the services of which a good is capable is divided
off and transferred separately, while the rest of the anticipated services,
be they many or few, remain with the ownership of the body of the good, in
the hands of the owner of the good.[8]
Finally, it is of great theoretic importance to determine the relations
that exist between the material services and the goods from which they
proceed. On this point I may put down three cardinal propositions, all of
which appear to me so obvious that we may dispense here with any detailed
proof of them; more especially as I have gone thoroughly into the subject on
another occasion.[9]
1.
It seems to me clear that we value and desire goods only on account of
the material services that we expect from them. The services, as it were,
form the economical substance with which we have to do. The goods themselves
form only the bodily shell.
2.
It follows from the above, and appears to me equally beyond doubt,
that, where entire goods are obtained and transferred, the economical
substance of such transactions always lies in the acquisition and the
transference of material services — indeed of the totality of these services.
The transference of the goods themselves constitutes only a form — certainly
a form that, in the nature of things, is very prominent, but still only an
accompanying and limiting form. To buy a good can mean nothing, economically
speaking, but to buy all its material services.[10]
3.
From this, finally, comes the important conclusion that the value and
price of a good is nothing else than the value and price of all its material
services thrown together into a lump sum; and that accordingly the value and
price of each individual service is contained in the value and price of the
good itself.[11]
Before going farther let me illustrate these three propositions by a
concrete example. I think all readers will agree with me when I say that a
cloth manufacturer values and demands looms only because he expects to get
from the looms the useful energies peculiar to them; that not only when he
hires a loom, but when he buys it, he looks, as a fact, to the acquisition of
its services; and that the ownership he acquires at the same time in the body
of the machine only serves as greater security that he will obtain these
services. Even if this ownership in point of law appears to be the primary
thing, economically it is certainly only the secondary. And, lastly, it will
be granted, I think, that the use which the whole machine renders is nothing
else than the use of all its material services thrown together into one sum;
and that similarly the value and price of the whole machine is nothing else,
and can be nothing else, than the value and price of all its material
services thrown together into one sum.
