The house of Industry : a new estate of the realm

CHAPTER XIII CONSUMPTION AND CO-OPERATION

A LITTLE DIGRESSION INTO ECONOMICS

POLITICAL economy and finance both alike ignore intrinsic value. Things being what they are, the only factors that political economy or finance or that vague and indeterminate bogey known as the ‘‘ market’ can take into consideration are those which affect price and consequently determine rent and profit. Thus, the intrinsic value of a pair of boots is not affected by market prices. Yesterday, these boots may have been worth fifteen shillings, to-day twelve-and-sixpence, but their intrinsic value is measured by their appearance, use, comfort and durability. Obviously these qualities are unaffected by changing market values.

This intrinsic value would be of purely academic interest if it had no extrinsic value; that is to say if it made no appeal to any actual or potential consumer—if there were no effective or natural demand for the boots. Here we discover a fact of considerable social significance: namely, that natural demand, like intrinsic value, is also beyond the purview of our Philistine economy. The economists, of course, know all about it; they merely affirm that until natural demand has

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