chapter  XVII
10 Pages

THE INFLUENCE OF THE MARKET ON THE DEMAND FOR CAPITAL

THE INFLUENCE OF THE MARKET ON THE DEMAND FOR CAPITAL T HE social importance of the work done by the market cannot be measured simply by its effects in facilitating

the supply of capital in response to the actual demand ; it must be measured by its effects in facilitating the supply

of capital in response to the true social need. The organization of the market operates partly on the side of supply, partly on the side of demand; and its work must be taken to include both that of reducing the costs at which capital is supplied and also that of formulating the social need into an effective market demand. We need therefore to take account of the economies effected by the market on the side of Demand, and may begin by giving some clearer definition of the nature of what has been described as " the true social need."