Knowledge that Transforms

The subject of accounting, which for a long time was looked at askance and treated as a stepchild among courses in economics, has now come to be rather generally recognized as essential to the training of an economist, entirely aside from its place in business training. Courses in accounting now appear on the schedules of departments of economics in most of our universities and colleges. The reason for this is that economists have come to recognize that almost any kind of study of the working of economic forces in the business world of today requires, among other things, an understanding of (i) the manner in which the status of a business investment is commonly set forth, (2) the facts to be considered in determining the successfulness of a business investment, and its status at a given time, and (3) the type of information needed by the business manager as an aid in controlling the investment, and the methods by which such information may be gathered. But in spite of the growing recognition of the need for an understand? ing of these matters by the economist, it is still easy to find evidence in the writings, public addresses, and classroom utterances of some economists of high standing that these men have not given sufficiently careful consideration to the nature of a business investment and the

Prof essor Carver' is a welcome addition to the steadily increasing number of economic students who are dissatisfied with the neoclassical limitations that have been imposed upon economic theory. He has joined the "welfare crowd," his volume being dedicated " to all those who care to see their country grow great and strong. " Viewing with high scorn the common doctrine that the economist should concern himself only with the means of satisfying desires, without considering the possible detrimental effects to the race, he accordingly deplores the lack of attention that has been given to consumption by writers on political economy and remarks that "a few students are beginning to discover that consumption is more important than production, exchange and distribution-possibly more important than all three combined" (p. ii). "Consumption reacts powerfully upon all other departments, particularly upon distribution" (p. 455). This emphasis upon consumption and upon the concept of welfare meets with the reviewer's unqualified endorsement. I have always failed to understand why economists should lay such emphasis upon "long-run" considerations and then persist in counting all things as wealth so long as they momentarily satisfy individual cravings, regardless of their ultimate economic and social consequences. The narrow definition which makes whiskey wealth because it has utility has not tended to commend economic analysis to the favorable consideration of those whose interests lie in the field of public welfare. There could, of course, be little objection to the classical definition of wealth if the economist were satisfied to admit at the conclusion of his analysis that it had little bearing on problems of long-run economic development or on matters of practical statesmanship. But this he is seldom content to do. He fancies that, like Adam Smith, he is really concerned