ABSTRACT
Advantageous exchanges can take place whenever the relative significance of any two exchangeable things is marginally different on the scales of any two men in the community; and the exchange itself tends to reduce this difference. Therefore when there is equilibrium the exchangeable things on every man's scale must occupy the same relative positions. A scale registering these positions may be regarded as the communal scale. Exchange may arise incidentally, to correct errors of individual administration of energies; but complex systems of industry, that avail themselves of the economies of division of labour, contemplate exchange from the first, as an essential part of the machinery of adaptation of means to ends. In a society so organised media of exchange and standards of value arise spontaneously, and are then regulated by law. The use of gold as a medium and a standard is dependent upon its use as a commodity. The gold prices of commodities, being an expression of their positions on the communal scale in relation to gold, may become the expression of their positions relatively to each other, and of the identity of those relative positions on all the individual scales of persons who possess them. But this identity docs not extend to things that cannot be exchanged. These may occupy positions differing to any degree both amongst themselves and amongst the items of exchangeable things on the different individual scales. And so may exchangeable things of which a man possesses no stock. As the ultimate 127objects of desire are never amongst the things that enter into the circle of exchange (though never realisable without them), the identity of scale is always objective and external, and never vital. Possessions, actual or virtual, are indeed necessary to life, but, as they increase, their marginal significance to life declines, and the danger arises of sacrificing life to them instead of supporting it on them.
