ances, with the same
labour and the same capital, it would serve approximately for a
standard. Accordingly he gives notice that, for the purposes of his
book, he will assume this to be the case, and money to be 'invariable
in value.'[324] We can thus, on the one hand, compare values at
different periods. A thing has the same value at all times which at
all times requires 'the same sacrifice of toil and labour to produce
it.'[325] The 'sacrifice' measures the 'utility,' and we may assume
that the same labour corresponds in all ages to the same psychological
unit. But, on the other hand, at any given period things will exchange
in proportion to the labour of producing them. This follows at once
from Ricardo's postulates. Given the single rate of wages and profits,
and assuming the capital employed to be in the same proportion, things
must exchange in proportion to the quantity of labour employed; for if
I got the same value by employing one labourer as you get by employing
two, my profits would be higher. Ricardo, indeed, has to allow for
many complexities arising from the fact that very different quantities
of capital are required in different industries; but the general
principle is given by the simplest case. Hence we have a measure of
value, applicable at any given time and in comparing different times.
It implies, again, what M'Culloch sums up as the 'fundamental
theorem,' that the value of 'freely produced commodities' depends on
the quantity of labour required for their 'production.' What is made
by two men is worth twice what is made by one man. That gives what
M'Culloch calls the 'clue to the labyrinth.'

The doctrine leads to a puzzle. If I can measure the 'sacrifice,' can
I measure the 'utility' which it gains? The 'utility' of an ounce of
gold is not something 'objective' like its physical qualities, but
varies with the varying wants of the employer. Iron or coal may be
used for an infinite variety of purposes and the utility will be
different in each. The thing may derive part of its 'utility' from its
relation to other things. The utility of my food is not really
separate from the utility of my hat; for unless I eat I cannot wear
hats. My desire for any object, again, is modified by all my other
desires, and even if I could isolate a 'desire' as a psychological
unit, it would not give me a fixed measure. Twice the article does not
give twice the utility; a double stimulus may only add a small
pleasure or co