The distribution of wealth . per-ate in the same way as with the owner of labour. In Diagram VIII. let he represent the entire in-come of a capitalist, say $1,000,000 per annum. Thecurve adfx^ measured from hc^ represents the amountpf sacrifice which he will experience in saving succes-sive increments of his income. He has a sufficientlypowerful vision into the future to feel severe painif he should consume his entire income in presentenjoyment, so that the line ad^ measured below thebase line, represents actual pleasure in saving theamount of capital hd. But, from the point d^ additional IV D
The distribution of wealth . per-ate in the same way as with the owner of labour. In Diagram VIII. let he represent the entire in-come of a capitalist, say $1,000,000 per annum. Thecurve adfx^ measured from hc^ represents the amountpf sacrifice which he will experience in saving succes-sive increments of his income. He has a sufficientlypowerful vision into the future to feel severe painif he should consume his entire income in presentenjoyment, so that the line ad^ measured below thebase line, represents actual pleasure in saving theamount of capital hd. But, from the point d^ additional IV DIMINISHING RETURNS AND DISTRIBUTION 187 increments begin to infringe upon his desire for pres-ent enjoyments, and true abstinence appears. Shouldhe save his entire income, the line of abstinence forthe last increment would take the direction x^ and theamount of abstinence would be infinite. The rate ofinterest for a given period of time, is measured by theline gf. The amount of capital which this capitalist Diagram VIII. X X. will save is then measured by %, and the last incre-ment saved, yields a return in future pleasures, , which exactly balances the subjectiveestimate of present pleasures postponed. Thecapitalist has gained an unearned surplus above thecost of saving on all the previous increments, andthis total surplus is measured by the area adfk. 188 THE DISTRIBUTION OF WEALTH chap. The same diagram may represent the savings andabstinence of an entire community. Wealthy indi-viduals, and those of vivid foresight, experience littleor no sacrifice in abstinence; but there is a marginof moderately circumstanced individuals, and thosewho have a keen sense of present joys, who must beinduced to save, in order that there may be sufficientcapital for the needs of production. These are inthe region gg\ There are also a number of personswhose present wants are so intense, and whose in-comes are so meagre, that they cannot save underany circumstances. They are in the re
Size: 1783px × 1401px
Photo credit: © The Reading Room / Alamy / Afripics
License: Licensed
Model Released: No
Keywords: ., bookcentury1800, bookdecade1890, bookiddistrib, booksubjectwealth
