PRINCIPLES

OF

POLITICAL ECONOMY

BY

WILLIAM ROSCHER,

PROFESSOR OF POLITICAL ECONOMY AT THE UNIVERSITY OF LEIPZIG,CORRESPONDING MEMBER OF THE INSTITUTE OF FRANCE, PRIVY COUNSELLOR TO HISMAJESTY, THE KING OF SAXONY.

FROM THE THIRTEENTH (1877) GERMAN EDITION.

WITH ADDITIONAL CHAPTERS, FURNISHED BY THE AUTHOR, FOR THIS FIRSTENGLISH AND AMERICAN EDITION, ON

PAPER MONEY, INTERNATIONAL TRADE, AND THE PROTECTIVE SYSTEM;

AND A PRELIMINARY

ESSAY ON THE HISTORICAL METHOD IN POLITICAL ECONOMY

(From the French)

By L. WOLOWSKI,

THE WHOLE TRANSLATED BY

JOHN J. LALOR, A. M.

VOL. II.

NEW YORK:

HENRY HOLT & CO.

1878.

Entered according to Act of Congress, in the yeareighteen hundred and seventy-eight,
By CALLAGHAN & CO.,
In the office of the Librarian of Congress, at Washington, D. C.

DAVID ATWOOD, STEREOTYPER AND PRINTER, MADISON,WIS.

TO

WILLIAM H. GAYLORD, Esq.,

COUNSELOR AT LAW,
OF CLEVELAND, OHIO,

TO WHOSE BROTHERLY CARE IT IS LARGELY DUE THAT I LIVED TO TRANSLATETHEM,

THESE VOLUMES

ARE AFFECTIONATELY INSCRIBED.

BOOK III.

DISTRIBUTION OF GOODS.

CHAPTER 1.

INCOME IN GENERAL.

SECTION CXLIV.

RECEIPTS.—INCOME.—PRODUCE.

The idea covered by the word receipts (Einnahme) embraces all thenew additions successively made to one's resources within a given period oftime.[144-1] Income, on theother hand, embraces only such receipts as are the results of economicactivity. (See §§ 2, 11.) Produce (Ertrag, produit) isincome, but not from the point of view of the person or subjectengaged in a business of any kind, but from that of the business itself, orof the object with which the business is concerned, and on which it,so to speak, acts.

Income is made up of products, the results of labor and of theemployment and use of resources. These products, the producer may eitherconsume himself or exchange against other products, to satisfy a moreurgent want.[144-2] Hence, spite[Pg 2] of the frequency with which we hearsuch expressions as these: "the laborer eats the bread of his employer;""the capitalist lives by the sweat of the brow of labor;" or, again, amanufacturer or business man "lives from the income of his customers,"[144-3] they are entirely unwarranted. No man whomanages his own affairs well, or those of a household, lives on the capitalor income of another man; but every one lives on his own income, by thethings he has himself produced; although with every further development ofthe division of labor, it becomes rarer that any one puts the finishingstroke to his own products, and can satisfy himself by their immediateconsumption alone. Hence we should call nothing diverted or derived incomeexcept that which has been gratuitously obtained from another....