above the technological, which the legislator is bound to consider.

We may call attention, in passing, to the squint // toward the Malthusian problem, and the "wagefund theory," which our knowledge of later developments enables us to detect in the formulation of the last chapter of Book II.

Book III attempts to explain historically the different plans which nations have adopted in applying labor power, and the reasons why the different policies have had different degrees of success in securing a relatively large output, and particularly the reasons why European policy since the fall of the Roman Empire has inclined in favor of the urban rather than the rural types of industry. This again is a strictly analytical inquiry. It is logically analogous with an investigation of the policy of the United States since the adoption of the Constitution with reference to public lands; or a comparison of our public policy toward rivers and harbors, with our treatment of railways, and the actual effects of the same. All this, in either case, would furnish important data for problems of morals. In so far as effects upon persons, rather than upon things, could be traced in either case, the respective policies would come into the moral realm.

The friction between economic and moral

theory has always been generated in part by the assumption that the policy which was judged to be profitable economically must for that reason alone be accepted as justified morally. Whenever this assumption has had effect in any degree, the tendency has been to obscure the boundary lines between economics as a technology, and moral philosophy, or sociology, as discoverer of a standard of life to which economic technology must be conformed.

In Book IV Smith attempts to explain the different economic theories which have been consciously or unconsciously behind the different policies discussed in Book III.

This purely historical inquiry, of a different sort from that pursued in Book III, may be compared with a history of political, or philosophic, or religious creeds. The facts in either case all have a certain ultimate value in showing what the political, or philosophic, or religious creed of living men should be. Primarily, however, they are mere exhibits of the actual workings of men's minds in the past. They show the conceptions by which they were influenced. They have no moral value for us whatsoever, except as we have some moral criterion by which to judge whether, or in what sense and degree, either of these previous creeds correctly interpreted the essential meanings of life.

In other words, there is no more moral quality or force in a mere exhibit of what men in the past have believed about economics, than there is in their beliefs about ornaments, or weather signs, or geography. The history either of economic processes or of economic theories furnishes some of the material for a theory of morals. It does this because both economic theories and economic processes perforce deal more or less with persons, as well as with wealth. In so far as economic theories or processes have to do with persons, they are to that extent positive or negative judgments of those values which are lodged in persons; in other words, of moral values. So long as we are considering such past judgments merely as facts, accounting for economic action, the inquiry is as strictly technological as a chemical inquiry into the effects of alcohol, for instance, upon various physiological conditions. It is a question beyond the competence of physiologist or chemist, as such, what on the whole should be the policy of nations or of individuals with reference to the manufacture and use of alcohol. So far as Adam Smith planned his inquiry into the history of economic theory, he was apparently free from the confusion which sprang up later about the bearings of the inquiry.

In the fifth and last book of The Wealth of Nations Smith treats of the revenues of the state,

as distinguished from the wealth created by the labor of the people of the nation and held by them as individuals. This again is a subject which, on the one hand, is purely a matter of fact as to the operation of a certain part of civic machinery. On the other hand, it borders first on another department of technology, viz., civic administration, and, second, on a whole realm of moral questions. The thought of the nineteenth century has been kept seething by varieties of opinions about the bearing which purely technical and material aspects of the situation should have upon decisions of major and minor moral questions as to the functions of government, and the choice between this and that scheme of administration, in discharging the functions.

In his announcement of this fifth book Smith shows very plainly his moral sympathies. For the first time he distinctly proposes to discuss the "ought" of the case. He thereby has recourse to his larger moral philosophy. Our present discussion is in no sense a challenge of the propriety of this last phase of Smith's argument. On the contrary, in his main scheme of method he is to be held up as a model of the scientific order of procedure in arriving at judgments of morals. He is at the same time a striking contrast with some of his successors. He first derived his con

ception of life in the large. Then he analyzed one of the great divisions of activity within the whole scheme of life. On this basis he attempted to decide what human programs should be adopted with reference to the wealth element among human interests. This order and spirit of procedure, enlarged and specialized, is the methodology for which the modern sociologists are contending. The economic theory and practice of the nineteenth century in England, at least until the younger Mill's time, tended farther and farther away from Smith's standard. The history of this apostasy is one of the most instructive approaches to a sane and convincing sociology.

Before we set out upon the work of justifying this proposition, it may be well to indicate more precisely the point of view from which we are to judge economic theory.

In a word, sociological analysis, so far as it has gone at present, has reduced human life on its psychical side to evolution of types of interests, evolution of types of individuals, and evolution of types of association between individuals. Without injecting any a-priori interpretation whatsoever into these phenomena, we find that they are the elements in which psychology and soci ology and ethics find their ultimate problems. Moral philosophy, whether it is the conscious and