Economics for Christians

Extract

By Economics we mean the conclusions arrived at by man in his study of the production and distribution of material wealth.

These conclusions are often called, with much solemnity, “laws” ; and if by “law” is meant something that has been observed to happen every time a certain set of conditions are present the word may pass.

For instance, the economic “law of diminishing returns” is the simple conclusion that there is a limit to the amount of labour that may be applied profitably to any given area. Half an hour spent daily on the plants in flower-pots or window-boxes should produce a profitable return, and another quarter of an hour may produce an increased return. But two hours would bring a diminishing return, that is, something certainly less than four times the good result of the half-hour’s attention. So with an allotment. Double crops may be obtained by the additional labour of a second person, but six people working on the same allotment will not produce six times as much harvest. A point is always reached by the “law of diminishing returns” when no more labour can be expended profitably on any given piece of work.