Principles Of Economics Author:Ralph H. Blodgett PRINCIPLES of ECONOMICS Revised Edition RALPH H. BLODGETT, Ph. D. Professor of Economics University of Illinois RINEHART COMPANY, Inc. Publishers New York COPYRIGHT, 1941, 1946, BY RALPH H. BLODGETT PRINTED IX THE UNITED STATES OF AMERICA BY J. J. LITTLE AND IVES COMPANY, NKW YORK All. RIGHTS RfSIRVED Preface The present volume is such a complet... more »e revision of my Principles of Economics, published in 1941, that it might almost be described as a new book. It represents, as every textbook must, a compromise between two desirable but often conflicting objectives simplicity and accuracy or com pleteness. I have not made simplicity an unconditional objective to be attained at all costs, but I have tried to present the discussion in as simple terms as possible within the limits set by the destre for accuracy or com pleteness. The result is a book which is probably not suitable for light, summer reading in a hammock, but it should be within the grasp of any average student who can achieve a moderate level of sustained effort. I have tried to keep the present edition from having any aspects of a history of economic thought or of a survey of contemporary economic theory. Where conflicting definitions of terms, statements of principles, or theories exist, I have presented in general only the one whfcn seems to tne most suitable for beginning student. In presenting theory, moreover, I have endeavored in the present edition to state in each case the under lying assumptions under which the results predicted by theories or prin ciples would be perfectly attained, and to indicate the extent to which these assumed conditions are likely to exist in our own economic system. As a result there are frequent cross references between our actual economic system and the ideal, theoretical model. Economic theories and principles are not presented as completely accurate descriptions of economic reality. Many textbooks in economic principles confine themselves so rigidly to a description of the economic system of the United States that students are likely to get the impression that our capitalistic type is the only type and that our ways of doing things are the only ways. To ignore the fact that noncapitalistic systems are or have been in operation in various coun tries seems to me a lamentable oversight. While the present volume assumes that the primary interest of the American student is in his own economic system, nevertheless it gives him some idea of the institutions under which other systems operate and of the methods and practices employed in these systems. Again, in the theoretical sections, laws and principles are examined to see whether they have significance only in a capitalistic system or general validity for all types of economic systems. I hope that this approach will help to make the students knowledge of economics both more sound and more useful than it would otherwise be. vi PREFACE Since this is a text on the principles of economics, it cannot undertake an exhaustive treatment of economic problems. Yet the dividing line be tween economic principles and problems is not sharp, and students who will take no other course in economics should not remain entirely unacquainted with leading economic problems of the day. Consequently the present edition contains chapters dealing with public finance and business fluctua tions and employment, and sections devoted to monopoly, the influence of labor organizations and legislation on wages, obstacles to international trade, governmental regulation of banking, and other matters. The order of topics and chapters in Principles of Economics is not entirely conventional, but I believe it is a logical and useful order. The first four chapters present introductory and background material...« less