from a certain source. As the volume thus originated rolls down the channel, it continually increases by infiltration from the neighbouring soil without any additional pumping, so that, the depth being preserved constant, the volume is proportioned to the increasing breadth.1 Besides this increase due to its defluxion, the volume may also in the course of its downward flow be increased by additional pumping from a second source (e. g. aza 2). This second increase corresponds to an increase in depth (not shown in the figure); and this second contribution is augmented, like the first, by the infiltration which attends

defluxion. There may be as many sources as there are circles cut by the descending stream. But there need not be a source at each interval. The equidistant circles correspond to successive lines, not always coincident with successive stages of production at each of which additional labour is applied.2 The train of

1 The broadening of the stream corresponds to the two consilient facts, that future pleasures are discounted and that production is increased by "roundabout" methods. As to the first of these facts, see in Marshall's Principles of Economics the passages which relate to discounting future pleasures, and the remarks on those passages in the review of the second edition of the Principles in the ECONOMIC JOURNAL, Vol. I. (1891) p. 613. See also the admirably clear explanation and illustration given by Professor Carver in his article on "Abstinence and the Theory of Interest," Quarterly Journal of Economics, Vol. VIII. (1893) p. 48. As to both the first and second facts, see Böhm-Bawerk's wellknown expositions. But as to the consilience of the two facts see, rather, Professor Marshall on the "fundamental symmetry" between the action of Supply and Demand (noticed in the review referred to). See also Professor Carver's explanation of the double statement that interest is payment for the sacrifice of abstinence, and that interest is paid because capital is productive (loc. cit. p. 43). 2 Corresponding to the machines in the illustration given in the preceding paragraphs.

production thus represented terminates in a product ready for consumption-it may be loaves or ribbons, wine or shoes-on the shore of a circumfluent sea of commodities. As in the natural world rivers are replenished by the melting of the snow, which is formed on mountains by the congelation of vapour, which is wafted up from the ocean, into which the rivers flow down, so in the mundus economicus, by a compensation carried into more just detail, labour is restored and re-created by a refreshing rain of commodities derived from that sea into which all finished commodities are discharged. Volatile shoes and wine, and other commodities in due admixture up to a certain value, find their way to each point upon the heights from which a source has been. tapped, the volume of this return corresponding to the volume of the original contribution,-not indeed the same, but the same increased by a factor of accumulation, the ratio which the breadth of the stream at the littoral bears to its breadth at the point of origin (e. g. a1a' a5a's). The flight of the commodities from the littoral to the heights need not be supposed to occupy an appreciable time.

The idea of a Flow which has been illustrated is primarily applicable to the case in which materials and consumable commodities are used up once for all within a unit of time. But the case of labour invested for longer periods is easily assimilated. Suppose that a plough lasts five years, and that in each year of its existence it makes an equal addition to the consumable crop, the year being taken as the unit of time. Then, although the plough may have been made in a week or month, the labour of its production is to be considered as invested in five unequal portions at unequal distances in time from the epoch at which the invested labour meets with its return. The total labour of making the plough may be considered as applied at several positions (a1a1, a2a2,... aa') in several contributions, respectively proportioned to the breadth of the stream at these points. If labour is invested in the production of a machine, imagined by economists, which lasts for ever,1 or, what comes to the same, an improvement, such as the draining of land or opening a mine, or cutting an isthmus, which is calculated to yield a constant income for an indefinitely long series of years, then the series of positions along the stream at which the labour is supposed to be invested must be carried back indefinitely (see the channel of which the mouth is bb') up to that needle-point whose tapering dimensions correspond to the perspective of an indefinitely distant future. 1 Mill, Political Economy, Book I. chap. vi. § 2.

Eternal machines are not very common; but the conception may serve to illustrate a species of tool or implement of which the race remains immortal, though the individual is worn out and perishes. Of this kind are implements which are directed not only to produce goods immediately ready for consumption or implements of a kind different from their own, but also to reproduce their own kind. Hammers and axes are presumably of this kind in a primitive society; in an advanced state of industry, some more complicated engines.1 Such machines may be compared to horses, if used not only as beasts of burden, but also as stallions. The demand for such creatures is presumably influenced by the expected series of future generations, so far as commercial prospectiveness may extend. In the stationary state of steady motion, here provisionally contemplated, reproductive machines would be illustrated by beasts of burden of which the breed does not sensibly improve in successive generations.

Two channels only have been represented in the diagram, one of finite, the other of infinite length, with breadth exaggerated for the sake of clearness. Properly, there should be as many channels as there are categories of articles ready for immediate consumption," goods of the first order," as the Austrians say; and the breadth should be such as to allow of the corresponding number of sectors being fitted into the circle. Another circumstance which must be left to the imagination is the introduction of one and the same article into several streams of production at different distances from the final stage. Coal, for instance, so far as it is used for warming dwelling-houses, is a good of the first order; so far as it is used to drive machines,-themselves perhaps used only to produce other machines,-coal is to be placed among the higher orders.

The distinction which has been drawn between work which is applied in the neighbourhood of and at a distance from the final stage of production is not coincident with the distinction between the saving and the non-saving classes. The shower of commodities apportioned to each spot according to its height above the littoral as well as to the volume of value which there took its rise, is not "like the gentle rain from heaven." It does not drop impartially on all who have been concerned with the work of eliciting the stream. Those who have done the common labour of pumping-the drawers of water-fare no better than if that work had been done at the littoral. In fact, it is proper to

1 Or rather a certain system of machinery. Cp. Marx on machines produced by machinery. Capital, ch. xv.

conceive that it was done at the littoral. As the energy generated at the Falls of Niagara is transmitted for use to a point higher up on the river, so on the stream of production the work of pumping is mostly done at the littoral, though it is applied at the heights. For instance, on the first stream an amount of work proportioned to asa's might be done at the littoral, and be paid for in commodities at the rate current on the littoral; that is, without the augmentation of value which is due to defluxion. The remainder of the volume of value which is discharged per unit of time flies off to those who occupy the height represented by

If now it is asked where rent comes into this representation of distribution, the answer is to be found in the theory (above, p. 33) that from the point of view of the entrepreneur the use of land appears in the same light as the use of labourers,-as a factor of production. The idea of a steady cyclic flow which we are striving to win becomes not much more complicated when we imagine that those who, placed on the heights, preside over the origination of productive streams, obtain the material that is to form the current, the precious fluid which it is their office to start upon its downward flow, not solely from a pumping proletariat, but also from the fortunate owners of springs which gush spontaneously. There is, indeed, this difference between the labourer and the land-owner: that, whereas the former (even in the present age and still more when the classical economists flourished) has to spend a great proportion of his daily wage upon his daily necessaries, and therefore in respect of the bulk of his income. must be placed at the littoral line, the latter may save a great part of his income, when it is greatly in excess of his daily necessaries, and in particular, with respect to that great portion, may defer fruition until the stream shall have flowed down from the point at which his contribution is applied to the point at which production becomes merged in consummation. Another difference between land and labour in their relation to capital and enterprise arises from the circumstance that, unlike the labourer (in a free country), land itself, as well as its use, is sold. Whence arises a well-known correspondence between rent and interest in their relation to the capital value of land. This similarity will not be mistaken for identity 1 by those who find the essential

1 "The attempt of certain writers to refine away this traditional distinction between land and capital, rent and interest, impresses me as a subtle obscuration of plain facts," well remarked one of the speakers at the recent banquet of the Massachusetts Single Tax League (1902).

attribute of rent in the limitation of the objects for which rent is paid.1

To complete the analysis of the parties to Distribution, it may next be required to distinguish the capitalist from the entrepreneur. They are both easily distinguished from the salaried manager in that he is at the littoral, in that respect like the common workman, while they are both above that line. But to draw a line in the series of shades which intervene between the employer of Walker's type and the mere shareholder, to determine at what point the capitalist ends and the entrepreneur begins, appears to defy analysis. As Thought and Emotion are inseparably blended, though one may so far preponderate as to give its name to the state of consciousness at any time, such is the inseparable connection, such the intelligible but not exactly definable distinction, between Enterprise and Saving. The indefiniteness of the relation is illustrated by the shifting use in economic literature of the term Profit.2

That profit other than remuneration for managerial work should be transmitted to those who occupy a position on the heights-often the easy position of a dormant shareholder-is certainly invidious and difficult to justify to those who toil below. Yet it may be reflected that the condition of those below would have been worse if those above, or those from whom they purchased or inherited their position, had not been content to wait for future goods instead of grasping at immediate pleasure. The Flow so beneficial to all classes would never have been set up without abstinence. It could not continue in its present magnitude but for the continued abstinence of each one who has a right to dispose of wealth which is in course of production,make a bonfire of it, if he can get a momentary pleasure from that extravagance, or by some less simple, though more familiar increase of unproductive consumption "eat up his capital."

The consequences of an increase in unproductive consumption may be contemplated by reversing the consequences of an

1 Cp. above, p. 32, Marshall, Principles, sub voce Rent."

2 As instructively pointed out by Mr. L. L. Price in his article on "Profitsharing" published in the ECONOMIC JOURNAL, Vol. II. (1892), and in his Economic Science and Practice, p. 75 and ante.

3 Compare Adam Smith. "By what a frugal man annually saves he not only affords maintenance for an additional number of productive hands for that or the ensuing year, but, like the founder of a workhouse, he establishes, as it were, a perpetual fund for the maintenance of an equal number in all times to come." Wealth of Nations, Book II. chap. iii. In our metaphor, taking up a new position on the heights corresponds to this establishment of a perpetual fund.