§1.When we turn to the other side of the account, the human utility which this £2,000,000,000 of goods and services represents, we enter a country which, as we have already recognised, Political Economy has hardly begun to explore.For though the trend of a large modern school of economists has been to find in consumption the vis motrix of all economic processes, and to bring close study to bear upon the pressure of consumers' wants as they operate through demand in the markets of commodities, this volte face in the theory of values does not render much assistance to our human valuation.For their analysis of demands does not help us to interpret expenditure in terms of human utility.As an instrument for such a purpose it is doubly defective.For, in the first place, it is concerned entirely with the actual felt wants and preferences which in fact determine purchases.
In the second place, it takes for granted the existing distribution of incomes or consuming power, tracing the operation of this power of demand upon the actual economy of economic processes.Now these limitations, quite necessary for the purely economic interpretation, are not suited to our requirements.
The current standard of valuations and of choice cannot be taken as an adequate standard of individual or social welfare.Felt wants, and demands based on them, form no doubt some index of welfare, but an insufficient one.
A considerable proportion of the goods and services included in the real income which we are analysing must from our standpoint be classed not as wealth, but as 'illth', to adopt Ruskin's term.What proportion we should place in the category will of course depend upon the degree to which we hold that the actual evolution of the arts of consumption has been distorted from its 'natural' course.But everyone will admit that many sorts of marketable goods and services are injurious alike to the individuals who consume them and to society.A large proportion of the stimulants and drugs which absorb a growing share of income in many civilised communities, bad literature, art and recreations, the services of prostitutes and flunkeys, are conspicuous instances.Not merely does no human utility correspond to the economic utility ascribed to such goods, but there is a large positive disutility.The aggregate human value of a growing national income may easily be reduced by any increase in the proportion of expenditure upon such classes of goods, and tendencies of distribution which lead to such proportionate increase may even invalidate the assumption that social welfare upon the whole grows with the growth of the national dividend.
We shall presently consider some of the factors in our social structure which bring about the development of definitely bad demands and bad products to satisfy them.
But just as we must write to the debit side of our human account a great many articles which figure on the credit side in ordinary economic book-keeping, so we shall be compelled to revise the comparative values attached to those articles which contain actual powers of human utility.
A valuation which sets an equal value upon each part of a supply because it sells for the same sum cannot serve the purposes of a human valuation.
For the amount of human utility, individual or social, attaching to the consumption of any stock of goods or services, must evidently depend in large degree upon who gets them and how much each consumer gets, that is to say upon their distribution.The same goods figure as necessaries of life or as waste according to who gets them.Some quarters of the same wheat supply furnish life and working energy to labourers, other quarters pass unconsumed into the dustbins of the rich.
There is, moreover, a third consideration which counts in the process of converting economic into human values.As in the distribution of productive energy human economy requires an adjustment to the individual capacity of production, so in the distribution of consumptive utilities a corresponding regard must be paid to the natural or acquired capacity of the individual consumer.Some persons have greater natural capacity than others for the use or enjoyment of certain classes of goods, material or immaterial.An absolutely equal distribution of bread, or any other necessity of life, on a per caput basis, would evidently be a wasteful economy.What applies to the prime physical wants will apply more largely to the goods which supply 'higher' wants.For, as one ascends from the purely animal to the spiritual wants, the divergences in capacity of utilisation will grow.
