ABSTRACT
The branch of economics which was in most urgent need of reformulation was, in fact, distribution. Under perfect competition, the sum of the values of productive services equals the value of the product, and the distributive share going to each service is easily ascertainable by use of the type of incremental analysis so prominent in the marginal utility theory. Although economic theory advanced in the 1870's, it is unfortunate that the advance was restricted largely to one branch of price theory. William Stanley Jevons, Carl Menger, and Leon Walras, the "revolutionaries" of the period, concentrated their efforts primarily on the theory of subjective value, and their immediate followers continued along much the same path. Once the marginal utility theory was applied to determine the value of a consumption good, the next step was logically that of determining the value of the productive services which produced the good. Economic theories are conclusions drawn from assumptions according to the rules of logic.
