T

.5

$35
1917

Econ. Dept. Econ. IA. Main Library

COPYRIGHT, 1913, 1917,

BY

HENRY HOLT AND COMPANY

THE QUINN & BODEN CO. PRESS
RAMWAY, N. J.

PREFACE

THE present work is the fourth edition of my Introduction to Economics, which was first published in 1904. I have changed the title to Principles of Economics to prevent the confusion of this book with my Economics: Briefer Course, which appeared in 1909, and to conform to the usage which has grown up of designating as Principles any treatise which covers the whole field of economics.

The purpose of the book is to introduce college classes to the study of the subject. This is, if I may repeat what was said in the preface to the first edition, "a task of no little difficulty. If lectures are depended upon exclusively, much time must be wasted in imparting information that could be acquired more quickly and more surely from the printed page. On the other hand, exclusive reliance on a text-book results in narrowness and dogmatism on the part of both teacher and student." The obvious escape from this dilemma is to combine the text-book and lecture methods, and it was to facilitate such a combination that the book was first written.

In revising it for this new edition I have done a good deal more than bring the information it contains up to date, important as this part of my task has been. I have rewritten several of the theoretical chapters and recast the explanations of the laws of value and distribution so as to anticipate difficulties and clear up possible misunderstandings. While continuing to describe the explanation of distribution presented as the "productivity theory," I have tried to make it perfectly clear that this phrase is intended merely to emphasize the intimate relation between distribution and production, which some economists have seemed to deny. An understanding of distribution requires constant attention to both sides of the value problem, the demand side and the supply side, and no theory, by whatever name it be called, can be complete which wavers in this attention or gives undue

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