The Online Library of Liberty

A project of Liberty Fund, Inc.

• Introduction
• Prefatory Letter to Mr. Fisher Unwin
• Preface the Laws of Nature
• I. The Motive of Human Activity.
• II. The Natural Law of the Economy of Power, Or the Law of Least Expenditure.
• III. The Natural Law of Competition For a Subsistence.
• IV. The Natural Law of Value.
• Part I the State of War
• Chapter I Formation of Primitive Communities and the Conditions Necessary to Their Existence
• Part I: Chapter Ii Competition Between Primitive Communities and Its Results
• Part I: Chapter Iii Competition Between States In Process of Civilisation
• Part I: Chapter Iv Decline of Destructive Competition
• Part I: Chapter V Why the State of War Continues When It No Longer Fulfils a Purpose
• Part I: Chapter Vi Consequences of the Perpetuation of the State of War
• Part Ii the State of Peace
• Chapter I the Collective Guarantee of the Security of Nations
• Part II: Chapter Ii the Free Constitution of Nationality
• Part II: Chapter Iii Free Constitution of Governments and Their Natural Functions
• Part II: Chapter Iv Free Constitution of Governments and Their Natural Functions (continued)
• Part II: Chapter V Free Constitution of Governments and Their Natural Functions (continued)
• Part II: Chapter Vi Subjection and Sovereignty of the Individual
• Part II: Chapter Vii Impost and Contribution
• Part II: Chapter Viii Production of Articles of Naturally Individual Consumption
• Part II: Chapter Ix Equilibrium of Production and Consumption
• Part II: Chapter X Distribution of Products and the Share of Capital In the Proceeds of Production
• Part II: Chapter Xi Distribution of Products and the Share of Labour In the Proceeds of Production
• Part II: Chapter Xii the Problem of Population
• Part II: Chapter Xiii Consumption
• Part II: Chapter Xiv the Expansion of Civilisation
• Part II: Chapter Xv Summary and Conclusion
• Part Iii
• Note a the Czar and Disarmament
• Part III: Note B Syndicates Restricting Competition, Or "trusts"
• Part III: Note C Effects of Industrial Progress On the Sphere of Production
• Part III: Note D Costs and Profits of State Colonisation
• Part III: Note E the Economic and Socialist Conceptions of the Society of the Future
• By Edward Atkinson, Ll.d., Ph.d. I

II. The Natural Law of the Economy Of Power, or the Law of Least Expenditure.

From the motive of which we have spoken, the roots of which lie deep in human nature and the conditions of human existence, we derive a first natural law, the Law of Economy in Production, or the Law of Least Expenditure. Under the spur of interest, man first satisfies his most pressing needs, those that appeal with the greatest urgency, or penalise deficient supply with the greatest amount of suffering. It is only after this that he endeavours to decrease expenditure by selecting the more remunerative spheres of activity, and by setting himself to perfect processes, or invent tools, which enable him to enhance the profits of production. By increasing the margin of gain, enlarging the excess Of material acquired or saved over the outlay of vital force, he also insures the preponderance of compensatory pleasure over the discomfort, which is inseparable from effort.

The individual whose income exceeds expenditure, who possesses a profit, may sink it in the purchase of immediate enjoyment, or collect it as capital to be employed in a further increase of his productive capacity. He may, also, simply hoard it against future need. It, then, serves the purpose of a twofold reserve, drafts upon which may obviate privations, or furnish the means of repelling such chances as may, hereafter, menace vitality. When individuals of the same, or of alien races, join issue as to who shall obtain the materials of subsistence, the victor is he who has devoted most profits to remunerative ends, to measures best fitted to conserve, or augment, his vital force.