ABSTRACT
The economist who wishes to be an object of serious interest must be prepared to modify his stolid assumptions and conceptions. If economics is to adopt the proposed course, of a flexible theory adapted to the complexities of real economic life, the first modification is to note the quantitative and qualitative differences in economic characters and items. The second modification to enable economic theory to co-operate with Statistical observation and measurement is the realization of the variable relation between economic characters. Recent developments in economics are gradually qualifying economic theory to play the role of co-operation in this respect. The assumption of competition plus business acumen among competing entrepreneurs leads to the almost automatic conclusion that price must be equal to the cost of production in the long run. An economic theory that thinks in terms of variable characters and factors and of variable relations between those characters and factors has an important role to play in Statistical investigation.
