t are bad? The measure which
he has at present is that of price, cost and the resultant profit, and
it would be fatal to take that away, unless an equally simple and more
accurate measure could be substituted for it.

This is not a question, it should be observed, of motive or
incentive. Very likely we much exaggerate the importance of the profit
motive. It may be true that men would work, perhaps that they already
work in fact, as zealously for a fixed salary, as for personal
gain. But aim and motive are two somewhat different things, and the
_aim_ of profit, is, and will remain, essential to the efficient
conduct of business. In a game the players are not animated by the
motive of scoring runs or points, but they aim at them; and the zest
disappears very speedily from the game, if that aim ceases to be of
interest. Moreover, while a scoring system is always a somewhat
arbitrary thing, measuring imperfectly the true merits of the play, if
it measures them with the roughest accuracy, we prefer the issue of
our games to be decided so, rather than by the decisions of an
impartial judge, who can take into account the finest points of
skill. So it is in the world of business. The scoring-board of profits
may be an imperfect one; let us, by all means, where we can, alter the
rules of the game so as to make it better. But let us not imagine that
it displays a finer insight or a superior intellect to speak as though
the scoring-board could be dispensed with, and the test of profit and
loss treated as irrelevant. Quantitative measurement is essential to
efficiency. Let us be careful to remember all that this implies.

INDEX

Ability
Accountancy
Allocation of resources
Ambiguities
Australasia

Bastiat, Frederic
Beef and hides
Borrowing and lending, system of
Business efficiency
Business man as a purchaser
Business risk

Capital;
as representing a period of waiting;
distribution;
distribution and rate of interest;
effect on labor of an increased supply;
not a stock of consumable goods;
reaction of price charges on;
reflections upon;
supply;
supply as affected by charges in interest rate
Capital goods
Capital market
Capitalism
Capitalist
Chance
Coal industry, cost of production and price;
miners' wages
Coats, J. & P.
Collective saving
Commodities;
labor as a commodity
Competition
Composite demand
Composite supply
Consumable goods
Consumers' goods and producers' goods
Consump