ABSTRACT
Economic accounting depends on the possibility of equating, say, a ton of feathers to a certain weight of lead, and then on reducing them both for accounting purposes toa common standard, or equivalent. Of course, one can arrive at any number of purely arbitrary equations between feathers and lead, and on this basis work out accounts which bear on the surface every appearance of adequacy; one could equate one ton of feathers, or ten or twenty tons, to one ton of lead, or ten tons of lead to one ton of feathers, according to one’s whim. But such equations would have no objective basis in reality; and for economic accounting to have any meaning such equations must reflect something real and actual. The common unit to which one reduces both feathers and lead need not be anything which is used as a concrete medium of exchange; it may be simply an “x” or “y.” But whether the unit be actual or imaginary, it will be serving the function of a measure or a “unit of account”; and the matter of predominant importance— more important than the character of the unit—is that the equating or “pricing” of commodities in terms of this unit should have an adequate objective basis.
