REPRINTS OF ECONOMIC CLASSICS THEECONOMICSOFALFREDMARSHALL Abo PubliJhed in Reprintsqf Economic Classics By HERERT J. DAVENPORT VALUE AND DISTRIBUTION [1908] THE ECONOMICS OF ALFRED MARSHALL BY H. J. DAVENPORT LATE PROFESSOR OF ECONOMICS IN CORNELL UNIVERSITY REPRINTS OF ECONOMIC CLASSICS Augustus M. Kelley, Bookseller New York I96S Original edition I9J5. ReprintedI965 by an-angement with Cornell University Press. Library ofCongress Catalogue Card Number 65-I9648 PRINTED IN THE UNITED STATES OF AMERICA by SENTRY PRESS, NEW YORK, N. Y. 100I9 FOREWORD FORmanyyearsinclassroomandseminarProfessorDavenport's primary concern was with criticism and constructive amend m€nt of the doctrinal content of the classical and neo-classical eco nomics. His attitude toward systematic economic theory was never thatof the iconoclast. Hewasindeed a jealousguardianoftheeco nomic discipline, and thought of himself as contributing to the perpetuation of an improved bodyof economic doctrine. Professor Davenport's own contributionsto economic theorywere frequently couchedintheformofmoreorlesscontroversialcommentuponthe doctrinesofothereconomists. Inhisownthinkingand inhis teach ing Marshall especially was a perennial point of reference. The present study, though mainly written in the two years following Professor Davenport's retirement from active academic duties, is thereforetheproductofmorethan thirty years' preoccupation with Marshall's economics. The book is in one sense a finished product and in another it is not. It covers all the ground which Professor Davenport inten~ed to cover and says on all points substantiallywhat hewished to say. Hisdeath, however, prevented completion ofthefinal revising and polishingwhich was under way, and.to this fact may be attributed much unevenness of quality. The book has been prepared for publication by a committee of the department of economics of Cornell University consisting of PaulT. Homan andM. SladeKendrick, in collaborationwithMar garetF.Milliken, formerlyofthedepartmentofeconomicsofStan ford University. The members of the committee decided that the manuscripthadreachedastagewhichmadeitunwisetoattemptedi torial improvement even of the less perfect parts. It is therefore published almost exactly as it was left. A few obvious errors have beencorrected, and anumberof repetitivequotations have been re moved. Specialmention must be made ofthe services rendered by Miss Milliken who assisted ProfessorDavenportin the preparation ofthemanuscriptatallstages. CONTENTS PAGE I INTRODUCTION............................. 1 II. NEO-CLASSICAL SYSTEM OUTLINED. •. •••••••••• 15 III DEMAND AND SUPPLY MECHANICS.. . .. . . . . .. . . 36 IV UTILITY, PRICE, AND MEASUREMENT .•........• 69 V COSTOFPRODUCTION. ••••••. •. .• . •••••••••.• 107 VI COST OF PRODUCTION (continued) 123 VII PRICE - DETERMINING AND PRICE -DETERMINED COSTS: CAPITAL .•.••••.. 140 000.0.0.......... VIII THETESTSOFLANDCAPITAL 165 00000. o •••• 00' 0 • •• IX OPPORTUNITY COSTS: VARIOUS LAND COSTS. •••• 215 X QUASI-RENTS: EQUIPMENT AND EFFORT ••• 253 0 • 0 •• XI EMPLOYEEANDENTERPRISERLABORRETURNS •••• 288 XII NORMALS AND REPRESENTATIVES o. 328 0 0 .0' •••• 0" XIII COSTSIN GENERAL o. 375 0 0 • 0 • 0 0 • 0 0 0 ••• 0 0 0 • 0 0 0 ••• XIV LAWS OFRETURN 418 0 • 0 0 • 0 0 0 0 o •• 0 •• 0 ••••• 0 0 • • •• XV INTEREST •. 439 0 ••• 0 • 0 • 0 0 ••• 0 0 0 ••• 0 00 • 0 •• 0 •• 0 0 INDEX 479 00 •• 0000.000 ••• 0 0 ••••• 00............