Showing papers in "Journal of Political Economy in 1909"

Land Tenure and Land Monopoly in New Zealand: II

Abstract: It might be supposed that in a country like New Zealand, so recently settled and so demnocratic in its constitution, the evils of the land problem in older countries would have been successfully avoided. Yet the people of the Dominion do 1not appear to think so; for there has scarcely been a year since responsible government was granted in which Parliament has not passed new land laws or amended old ones. The Land Act, I 892, repealed fifty-two, acts and ordinances, and since then sixty-eight amendments of more or less imnportance have been passed. Two main aspects of the land question have fromi time to time loomed large in the public mind in New Zealand. The first of these is, \"Should the state sell its lands at all or 1merely lease them?\" The second is, \"What is the most effective means of preventing land monopoly andI the aggregation of large estates ?\" At various times one or other of these questions has engrossed the attention of Parliament and the people. The attemupts made and the results achieved form one of the most interesting objectlessons New Zealand lhas yet furniished to the student of ecoinomics. The advisability of the state's retaining its own lands did not elnter seriously into politics until the decade between I870 and i88o. Prior to that the legislature and the provincial governments were more concerned with getting the land taken up and settled than with any theoretical views of land tenure. Edward Gibbon Wakefield, the founder of New Zealand, laid down the principle that the land should only be sold at a uniformr and sufficient price and the proceeds employed in importing labor and carrying out public works. 1-is system has been fiercely attacked as an attempt to reproduce a landed aristocracy in New Zealand anld ha.s been ably defended' as a means of securing settlers of 1 See Reeves, State Experiments.

Gold and Prices, 1890-1907

Abstract: The influence of the large production of gold upon the level of prices in the last decade presents one of the most interesting problems in theoretical as well as in practical economics. Since Ricardo, and even before him, the familiar theory has been held that an increase of the circulating medium necessarily produces an increase in the prices of goods. Yet, in the United States, we have had falling prices with an increasing circulation. Indeed, the old theory of Ricardo and Hume no longer holds undisputed sway. There seems to be general agreement hat the price of an article, like wheat, is the quantity of the given standard for which it will exchange. Obviously, price is an expression of the exchange-ratio between a commmodity, likewheat, and a standard, like gold. Hence, in these later days, it has been seen that this ratio can be changed by forces affe;cting either term of the ratio. While the causes influencing the supply and demand of gold are supposed constant, we know that causes touching the demand and supply of wheat can modify its gold price. A scanty harvest and a reduced supply of wheat, or a new demand, will raise its price; while reduced freights, improved processes, an increase of supply, or a diminished emand, will lower its price. These facts, touching wheat alone, are self-evident; and they show that changes in price are not to be attributed solely to forces affecting

An Economic History of the Illinois and Michigan Canal: III

Abstract: Before the canal was opened for traffic its local influence in the development of the region through which it passes had been distinctly marked. After its opening it wielded a large influence, not only locally, but over a wider range of territory, by means of the added facilities which it furnished as a transportation route before the era of railroads, giving access to otherwise closed markets. Since the era of railroad-building began in the Middle West, it has also served as a freight-rate regulator at all competitive points. In the performance of these services, however, it has been handicapped by the conditions of the Illi? nois River, which with the canal completes the waterway from Lake Michigan to the Mississippi; by the character and con? ditions of railroad competition; and, to a less extent no doubt, by the character of the canal management. Three periods may be distinguished, logically and chrono? logically, in the history of the economic influence of the canal. The first included the development of the project and the con? struction of the canal. The second comprised the six years from the beginning of the traffic on the canal in 1848 to the opening of the Chicago and Rock Island Railroad from Chicago to the Mississippi River in 1854. The third is the period of competition between the canal and the railroads for traffic.

The Hughes Investigation

Abstract: Shortly after the panic of 1907 began, a rumor became cur? rent that \"Wall Street\" had designedly caused it in order to knock down the prices of stocks, frighten weak holders, and profit by the ruin of the community. This conception derived some plausibility from the fact that stocks had taken a sudden and violent downfall without any apparent reason, and that this fall continued increasingly from day to day. All eyes were fixed upon the declining quotations and all ears were filled with the clamor of \"the street.\" The losers naturally looked for some other explanation of the debacle than their own folly. Many on? lookers mistook the effect for the cause. The immediate cause

Methods of Teaching Elementary Economics at the University of Michigan

Abstract: and the administrative measures of our government, we find that most of them deal directly or indirectly with the economic life of the nation, and that they are consciously or unconsciously the results of efforts to express the root principles of economic science. Our government is the government of a democracy, and we should keep in mind that we are training future voters and public officials. Therefore, elementary economics must be primarily a course for citizenship.

The Aim and Content of a College Course in Elementary Economics

Abstract: We are confronted with three questions: What should be the aim or aims of a college course in elementary economics? What is the proper content or subject-matter through which to attain these aims? How should this subject-matter be handled? This paper deals with the first two questions. Both the question of content and that of aim should be approached from the standpoint of the general function of the college, and with the many and perplexing practical difficulties of the teacher of such a course constantly in mind. We cannot intelligently begin the search for the answer to our problem until we settle upon an aim for college education as a whole. We must here refrain, however, from entering upon the tempting field for discussion offered by this broader question, and content ourselves by positing somewhat dogmatically what seems, under present circumstances and in view of modern

The Tariff of 1909

Abstract: After a fiercely contested and long-drawn-out struggle, Congress has passed a new tariff act. This legislation is not the product of the special session of i909, but is the outcome of serious deliberation within the dominant Republican party extending over a period of at least three years, and of severe, and in the main well-founded, criticism directed by opponents and by non-partisan observers against the Dingley tariff of I897. Twelve years of experience under the Dingley tariff would necessarily have indicated some points at which bad or erroneous work had been done during the hasty process of revision which occupied the early days of the McKinley administration. Twelve years of industrial development must unquestionably have changed conditions of production and of business organization in such a way that the old rates upon many commodities, whatever their original virtue, had become obsolete or obsolescent. Twelve years of progress in foreign tariff making necessarily altered our relationships to other nations in such a way as to demand readjustments. Behind all these facts, technical in character as they largely were, has lain the increasing dissatisfaction of the consuminy masses due to an advance in Drices and in cost of livino' This is the first of a series of three articles on the tariff of i909 which Mr. Willis will contribute to -this Journal. The second article is to deal with the legislative history of the bill. The third will discuss the bearing of the tariff upon the foreign relations of the United States.

Currency: The Problem of Flexibility

Abstract: There seems to be a general agreement of opinion, both among the economists and among the men engaged in active banking, that, in spite of the currency legislation of the past two years, the currency system of the country is still in need of substantial reform, and that flexibility, the power to expand and contract in response to the varying needs of the business, world, is the one desirable quality to be given at the present time. The question has already been discussed to a considerable extent by members of Congress, in newspapers and magazines, and at various meetings of state and national bankers' associations. But while there is practical unanimity as to the thing to be desired, there is considerable diversity of opinion as to the means of attaining it. Perhaps the most prominent programme that has yet been brought forward is that of providing for the issuance, either through the national banks or through a central bank of issue, of a sort of emergency currency in the form of bank-notes redeemable within a given period of time. Many of the writers and speakers on the subject regard this plan as the easiest and most expeditious solution of the difficulty; many others, however, look upon it as an objectionable and somewhat dangerous expedient, likely to fail of its purpose in the time of greatest need. The objections to the plan are based chiefly upon the contention that a widely fluctuating volume of bank-notes is not a remedy for an over-extended credit situation bringing about an unhealthy, if not a dangerous, proportion of credits to the country's basic money, and that, although the issuance of bank-notes may afford relief so far as mere volume of currency is, concerned, it also has the undesirable effect of producing a still greater disproportion of the aggregate liabilities of the banks of the country to the total volume of gold and silver. No one will contest the point that a widely fluctuating quantity of bank-notes is not a remedy for an over-extended credit situation. When the bow of credit has been stretched to the breaking-point, it is useless to talk about relieving the difficulty by a

The Depositors' Guaranty Law of Oklahoma

Abstract: Durinlg the recent presidential campaign the people of this country, especially those in the W'est, heard a great deal about the guaranteeing of blank deposits. The idea is not a new one. It has frequently been advocated in the past, and a few of our states long ago tried the experiment: New York in I829, Vermont in I83I, and Michigan in 1836. In all these cases the experiments ended disastrously. In fact, it would be difficult to find a single example of the successful operation of such a scheme in this or any other country. Yet the advocates of the proposed plan, with varying degrees of inaccuracy, cite Germany's siystem of municipal savings banks, Canada's 5 per cent. guaranty of bank notes, Georgia's "chain-of-banks" system, and other unwarranted analogies, as ample evidence of their wisdom. Now comes the new state of Oklahoma, and under the inspiration of Mr. Bryan and Governor Haskell, the world is given another guaranty law-a sure preventive of any future financial disasters. Fortunately this is the only recent measure of the kind thus far enacted, but it is greatly to be feared that it will not long retain its solitary position, unless the spread of the false doctrine throughout the West is speedily checked. 1 The author wishes to acknowledge his special indebtedness for material used in the preparation of this article, to MIr. A. E. Sheldon, state librarian, Lincoln, Neb., Mr. J. W. ]MIcNeill, Guthrie, Okla., and Mr. D. W. Hogan, Oklahoma City, Okla.

The Language of Economics

Abstract: There are, no doubt, as Lord Cromer recently had occasion to remark, usome few economic and currency questions which are abstruse, but the difficulty of understanding even these has been in no small degree increased by the cloud of words with which writers on subjects of this sort often surround issues in themselves simple." The obscurity with which he justly enough charges our exponents of economic theory is comparatively speaking a new phenomenon. Up till about forty years ago books on the subject were, as a rule, written in fairly plain language. No one of ordinary education could seriously mis? take Adam Smith's meaning; and Mill, except here and there, was reasonably explicit and comprehensible. During the later years of the nineteenth century, however, a different state of things supervened. It began in England with the publication of Jevons' Theory of Political Economy, followed, as it was, shortly afterward, by the acclimatization in England of the works of the German writers known as those of the Austrian school.

Abstract Economics According to Schumpeter

Abstract: ECONOMICS ACCORDING TO SCHUMPETER The very title of Dr. Schumpeter's new book, Das Wesen und der Hauptinhalt der theoretischen Nationalokonomie)l suggests that we have here something unique in German economic literature. A careful examination of the work carries the conviction that this is the very purest of \"pure economics.\" No other writer has ever taken such pains to refine away from economic theory every trace of real life. Both man and nature are eliminated from the science, and pure assumptions bearing these names are substituted for them. According to Dr. Schumpeter's view, economists have sinned in attempting to be too profound. They have sought to ground their premises in philosophy, psychology, sociology, and other fields in which they are but dilettanti, and in which even the experts have found no firm footing. Hence the endless and fruitless controversies that have brought the name of economics into disrepute. A formal, contentless assumption is a far better premise for the science than the most brilliant philosophical generalization (pp. 26, 27). The economist who confines himself to the task of elaborating, by strict mathematical methods, all the conclusions that can be developed from a group of such premises is safe against refutation. True, the conclusions thus obtained are likely to have little to do with reality; they are capable of exciting only the mildest interest even in the mind of the specialist; and they are utterly devoid of practical importance. But, as the author wisely remarks, \"wenn man schon Theorie betreibt, so muss man es so griindlich und korrekt wie m6glich tun (p. 242).\" This kind of theory will hardly become popular with American economists, perhaps because, though we have failed in our boyish ambitions to become President, we yet hope to write something that a president, a governor, or an alderman may read. No statesman will ever read Schunmpeter. The starting-point of Dr. Schumpeter's system is an individual possessed of given quantities of different economic goods, among which are classed the individual's own productive powers. The reader is carefully warned against supposing that \"individual\" is anything but an assumption, methodologically useful. \"Goods\" are purposely left undefined, so as to leave no ground for con1 Leipzig: Duncker u. Humblot, i908. 8vo, pp. xxxiii+626.