reward; but it is so intimately associated with special knowledge and the qualities of business enterprise, as to leave some uncertainty attaching even to this conclusion.  When, on the other hand, we turn to the apportionment of these factors among different uses, we find relations which are both clear and fundamental.  Laws emerge which state at once not only “what is” or at least “what tends to be,” but also “what should be”; and it is the fact that they taste “what should be” that gives them their fundamental character.

These conclusions enable us to give a general answer to the question which was raised at the end of Chapter V:  What are the ultimate real costs to which the money cost of production correspond?  The attempt has often been made to relate money costs to such things as the effort of working and the sacrifice of waiting.  The existence of such costs is beyond dispute.  Much saving does mean a sacrifice of immediate enjoyment to the man who saves.  Most labor is irksome and disagreeable in itself, and involves strain and wear and tear; while all labor means a deprivation of the utility of leisure.  Workpeople, moreover, do not grow on gooseberry bushes, but must be fed and clothed from the cradle; and their rearing and maintenance represents a real cost which someone must incur.

But the existence (or the importance) of such costs is one thing, their relation to money costs is another.  In Chapter VIII we saw how difficult it was to establish any clear relation between the rate of interest and the sacrifice of saving.  The costs of labor present similar difficulties.  The relative irksomeness of two occupations may affect the relative wages which will rule in the two cases; so, certainly, will the differences in the cost of education and training which they require.  But these are matters which concern the apportionment of labor between different employments.  There is no good reason to suppose that the general wage-level would be reduced, merely because work as a whole became less irksome, or involved a smaller physical or mental strain.  The supply of people is not determined by the same kind of influences as is the supply of a commodity.  Parents do not produce children for the sake of the wages which the children will receive when they go out to work; or, if this happens, we rightly regard it as a horrible anomaly.  In so far as parents are affected by economic conditions it is by their own economic conditions; the question is rather one of how many children they can afford to have, than of a balancing of the cost to them against the incomes which their children may subsequently acquire.  But other considerations enter in; and, in fact, it is doubtful how the aggregate supply of labor will react to changes in prosperity.  Finally, the supply of land involves neither effort nor sacrifice; and, among our money costs, we have to account for the item of the rent of land.  To dispose of this difficulty by arguing that rent does not enter into marginal costs (in any sense which is not equally true of wages and profits) is to lose contact with reality.  Thus the attempt to explain money costs in terms of the costs of producing the ultimate agents of production leads us into a quagmire of unreality and dubious hypothesis.  For a systematic theory, which will rest on firm foundations, we must interpret money costs in very different terms.