BASIC FOR ECONOMICS
by   L. W. Lockhart
Writer of "Word Economy"
London, 1933
Psyche Miniatures - General Series No. 57

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Division of Pages

Special list of 50 economics words		Frontispiece
To the Reader		7
PART I.	Discussion	9
PART II:	Examples
	Florence on Current Economic Teaching	30
	Marshall on Gold and Silver	47
	Cannan on the Grouping of Incomes	63
	Lavington on Business Organization	78
	Stamp on Stimulus in Work	94
	Malthus on The Factors Limiting Population	111


TO THE READER
    Now that the Basic system is complete in its general form, it becomes important for the details of its use in specific fields to be put before the public. This work was started in Basic English Applied (Science), and taken a stage further with the printing of Basic for Business.   Basic for Economics is the third of these books for experts.
    Here, as in the other two books, a special list of 50 words is printed at the front, which may be used for economics in addition to the general 850. No space is given to a discussion of the Basic system itself which is put forward in detail in another little book named Basic English. The same material is given in step by step form in the ABC for the use of the serious learner.
    The greater part of this book is made up of examples from the writings of noted economists put into Basic. The selection was made by Professor Sargant Florence with a view to covering as wide a field as possible, and Miss Lockhart has been guided by suggestions from him and other experts by whom an economic committee was formed, at every stage in the work. The fact that he has given special attention to the language factor in economics has made Professor Florence's help of the very greatest value in such an undertaking.
    For authority to make use of the examples from F. Lavington's The Trade Cycle and Edwin Cannan's Wealth, we are in the debt of P.S. King and Son, Limited. In the same way, The Cambridge University Press has been kind enough to let us make use of part of sir Josiah Stamp's talk On Stimulus in the Economic Life, and the Royal Economic Society has let us take an example from The Official Papers of Alfred Marshall.

C. K. OGDEN.
  The Orthological Institute,
    10, Kin's Parade,
        Cambridge, England

Part I.     DISCUSSION
    The first thought of anyone looking at the special list of 50 economics words printed at the front will probably be that, on the face of it, most of these words are not expert's words at all ; or that, if they are, they have very little to do with economics.
    From one point of view this is certainly true. Running our eye down the list, we see words for the psychologist, such as effort, fatigue, habit, stimulus ; mathematics words, like average, correlation, statistics ; and words in completely general use, like accident and plan. Of those words which have a clear connection with economics, a great number -- for example, demand, supply, and service -- are simply common words which have been given new senses. It is a strange fact that, while most experts take a pleasure in dressing up quite simple words in new language, economists are noted for the opposite tendency. Even for their most complex ideas they take over words which have, as it were, had their edges rubbed off in the market-place.
    The words in question, however, are not so out of place as they seem. The reason for the wide range of the list is rooted in the very material of economics, which, because it has a much looser organization than those branches of knowledge which are commonly looked on as scientific, is not so much a science as a field of interest. 'Economic theory' may be kept within more or less's narrow limits, though even here the experts seem to have trouble in framing a covering statement. but it is not possible for what are normally talked of as 'economic questions' to be pinned down in this way ; and from this wider point of view, discussions about business organization or the psychology of work may be grouped under the heading of economics, though no space might be given to them in a handbook on economic theory.
    It has to be kept in mid that the purpose of Basic is not to make groups of words which are completely parallel to the divisions mapped out for the sciences, but to give every expert the words which will make it possible for him to put forward his ideas in an international language. Our first business then, is to see what is, in fact, chiefly talked about by an economist, a physicist, or whatever he may be, and to make it possible for the same things to be talked about in Basic. If words are needed which seem out of place in a special list, the scientist will have to be given them. If, in certain 'sciences,' a great number of the important words are clearly taken from other special fields, this may well give the experts food for thought, but it is no part of our undertaking to make a new grouping of scientific material. It is only necessary to say here that if the experts did see the point of basing the divisions between the sciences on facts of language and were ready to out their houses in order, it would give Basic a very much better chance of completely covering the special fields.
    in the form in which it is now printed, the economics list is the outcome of wide reading and experiment. About half of it was needed for putting into Basic the selections forming the second part of this book, which were made by Professor Sargant Florence without taking into account the powers or limits of Basic, and are said by him to be representative of the economic field. The other half of the list is based on the works of a number of economists such as Marshall, Taussit, and Flux, and on 'conference' material.
    The list seems so strangely uneconomic in part because the economist is cutting across other sciences, in part because economics is about everyday facts (so that words like fashion and season have to be looked at quite seriously), and in part because a number of the words which might truly be said to be special economics words -- price, value, interest, profit and the like -- are in the general list. Some of these are given a special twist, and it might be wiser to put other words or groups of words in place of them, but other are taken over without change because economics is based on general experience and is, as one might say, simply an angle from which certain common processes are viewed.
    A second fact about the special list is that it has in it almost no words for 'finance' or money business. As was pointed out in Basic for Business, the decision has been made that for the operations of finance another 50 words will be necessary. It is even probable that Exchange business may be given one list and banking another, because the language used in these two fields is very complex, and has in a great measure become fixed, like the names of persons and places. Another reason for separating off finance is that it is needed equally in business and in economics, and as far as possible it is our desire not to go over the same road twice. Naturally the business and economics lists have some words in common, because much of the material is the same and it would be unwise to make the learning of two lists necessary ; but the angles of attack are so different -- the business man being interested in the details of producing and putting on to the market certain goods about which he has expert knowledge, and the economist in the framing of general laws -- that the greater part of the lists are separate.
    There is in addition, a very strong reason why the tendency will be for the Basic economist and the Basic business man to make use of different sorts of words. Basic is chiefly needed by the business man for writing business letters, which are short and generally limited to the discussion of one point. The economist, on the other hand, is generally writing books or teaching, and when not doing one or other of these things he is probably taking part in some 'conference' or discussion, or having a heated argument with other experts. In other words, the business man will be happy if Basic lets him say what he has to say clearly. So long as the language is not strange to the ears of other business men, his interest is in what is said, not in how it is said, and there is no good reason for making one letter different from another if office-girls are better at copying than invention. But it is most important for the economist to be able to get an effect with language. If he does not put things shortly, and if he is forced to make use of the same words again and again, his hearers will quickly get tired. For this reason, because they are important in discussion, or because the way round would be a tongue-twister, certain words have been put in the economics list even though Basic parallels might be given for them. Examples are security, monopoly, pension, conversion, inflation, and deflation.
    It will be seen that the position of all the words in the list is not equally certain. the chief point is not equally certain. The chief point of getting out a book at the present stage is to put some suggestion before a wider public than one is able to get in touch with in any other way than by the printed word. It is only possible to put a working-system to the test by use ; and so that the test may be a true one, it is important to get as great a number of persons using it under as great a number of persons using it under as great a number of different conditions as possible.
    Plan is a key-word in 1933 and may well be important for another 50 years because, though planning is simply another name for organization, it has come to be used in a special sense for the adjustment of supply and demand, and there is every sign that the process will be a slow one. but when public interest is turned in other directions it may become unnecessary. Inflation and deflation are two other examples of words whose place in the list is open to doubt. In the first place, it is very simple to give Basic parallels for them, and the only reason for not doing so is that at the present time they are the point of division in so much economic theory. If there was a change in the system they would have no interest outside the history books. In the second place they are the sort of words which, in the interests of clear statement, it would be wise to take out of any science, because there are two different senses in which they are used, and these two senses frequently get mixed up. To economists of the old school, inflation (of which deflation is the opposite) is generally the process of increasing the amount of money in circulation till there is an over-supply of it in relation to goods, and so it is necessarily bad : to supporters of the new American planning, or those who have a belief in the distribution of credits by the nation, it is simply the process of increasing the amount of money in circulation, and at a time when there is an under-supply of money in relation to goods it is looked on as a step much to be desired. so serious have been the effects of using the word in these two ways that a new word 'relation' has come into existence for the purpose of overcoming the fixed idea of the old economists that inflation is necessarily wrong. It is still so uncertain if this word will come into general use that it would be unwise to put it in the Basic list. Another reason for having nothing to do with it is that the invention of new words for what are, after all, only questions of degree is a little foolish. With the help of 'adjectives' of approval and their opposites, and degree-words of all sorts it is quite possible for anyone who is conscious of the danger to make himself clear.
    Economics has a number of these words which are used without agreement as to their sense. this is necessarily a cause of trouble, the outcome being that economists are quite unable to keep questions of language separate from questions of fact, and frequently have long arguments about words in the belief that they are making discoveries about the economic system. Even in the Basic examples given in this book it may readily be seen how great the need for some organization of economic language has become, and how much time has to be wasted at present in clearing up points about words, so as to be certain that a wrong idea will not be given. Professor Florence (p. 30), before starting his discussion of current economic teaching, lets us see how hard it is to give an account even of 'economics' itself which will have general approval, and makes it clear that 'wealth' is a word to be used with the very greatest care. These are examples not so much of the tendency we have been talking about as of the need to get straight, through the instrument of language, about the root ideas of economics. but Cannan's discussion of wages, profit, rent, and interest (p. 63-77) makes one see the shortcomings of the language factor in the history of economic theory ; and from questions put to Marshall by the Royal Commission on the Values of Gold and Silver (p. 49) it is clear that there are different opinions about the use even of a word like 'currency'.
    At every point the language of economics is crying out for attention. Unhappily, it is quite impossible to go tot he root of the question in building up a Basic system, because it is our business to make discussion possible at the present level, and any attempt at the development of new habits of thought might make it harder to get support. Changes on the scale which is necessary for separating questions of language from questions of fact would only be possible with t he agreement of economists themselves. It was the fear that economists generally are unconscious of the language factor and unready for change which made us put in a word like rent. Rent is as good an example as it would be possible to get of a word which has been stretched in such a number of directions that its use is now only a cause of trouble. In common language it is simply payment for the use of land. From this we get the Richardian development of rent as payment for the natural properties of land, such as the amount of soil, sunlight, heat, rain, air, and so on. As is pointed out by Pigou, this division between the public and private value of land becomes important in connection with taxes. It was a short step from the Richardian theory to the view that rent is an income costing nothing, and that all incomes which are got without cost are rightly grouped as rent. On the other hand, another school makes the division between payment for use and payment for the thing itself the important point. to an outsider it seems that all this ranging of opinion on opposite sides is a very great waste of time. It is clear that payments man=y be grouped in a number of different ways, and hat all these groupings may become important in certain connections. What is needed is to give separate names to all of them, and not to have arguments about the 'true' sense of rent, as if words were not dependent for their sense upon the way in which they are used by men.
    There are limits, however, to the degree in which habits of language have to be respected. A word like 'wealth' which is simply the starting-point for arguments in a circle is much better out of the way, even at this stage. It is pointed out by Professor Florence that a number of persons who give an account of economics as the 'science of wealth' are unable to say anything more about 'wealth' than that it is 'economic goods'. Other accounts of 'wealth' take one very little further. A good example is given in Walker's Political Economy where 'wealth', after being named as the thing which economics is about, is said to "comprise all articles of value and nothing else". Value is in turn said to be "power in exchange;" but an earlier statement that "not all exchanges come within the scope of economics" gives one the feeling that, after all, Mr. Walker bas been building on sand. . . . In the end the only light we get on economics (and through it on 'wealth') is that 'economic', like 'blue' is something about which we have so little doubt that it is hard to put our knowledge of it into words. . . .
    There are two ways in which a representative committee of economists might make language a better instrument for their purposes. They might make a start on a clean page and get a new system of names worked out with the help of language experts. The value of such words as margin would then be seriously questioned, and words like entrepreneur, which are at present used very loosely (see Lavington, p. 78), would become fixed. Or they might put together a word-book in which all the different senses of the words used in economics were listed and grouped, so that anyone taking the word-book as a guide would be conscious of the danger-points in discussion. What is needed is an attack on the question from these two angles, but it will probably be along time before economists are ready to make serious adjustments, even if habit and history are in some measure respected, and for the present a word-book such as has been outlined might well be undertaken as a first step.
    There are some words for which it has not been possible to give Basic parallels, because it is so hard to get their senses fixed. Consumer is an example. Roughly, a consumer is a person using goods for pleasure and not for profit, but it is not at all simple to make a line between the two. We might say that a consumer is a 'private user', but the trouble here is that colleges are grouped as consumers though they would not generally be looked on as private users. Then again, what is using the profit? At the two ends of the scale, we have quite a clear idea of use for pleasure and use for profits, but if a mother gets a washing-machine so that the money which now goes in payments for washing may be used for some other purpose, for example going to the cinema, is she using the machine for pleasure or for profit?
    When economists take a word from common language and give it a new sense they frequently make use of it as if it had not been so taken over, a habit which is very unwise. Here again, consumer is an example. ...
    Even without the desired changes being made, the tendency of Basic is to make the language of economics more simple. Take, for example, Stamp's statement in the language of statistics that:
    "Narrow dispersions, skewed negatively, signify deliberate human restriction of output. Skewed positively, after the introduction of selection of employees by test or examination, a narrow dispersion indicates a successful system of selection."
    This goes into Basic quite simply at the level of the general reader, and, it would seem without serious loss (P.102), as:
    "The tendency to a common level of output, the higher output being more frequent, is a sign that output is consciously being kept within a certain limit. When the lowest outputs are most frequent and the output of workers not widely different, and generally high, after selection of workers by test has come into use, the tendency may be take as a sign of the efficiency of the system of selection."
    The need for expansion, as when 'utility' has to be talked of as 'use-value', keeps the sense of words well before the eye. The relation between 'utility' and value might be made clearer still by talking of value in economics as 'market-value'. Frequently, the fact that a word has to be got round makes any given use of it clearer. 'Manufacturer' is an example of this, though the effects here are not very important. When framing Basic parallels for the word the discovery was made 'manufacturer' is used in three separate ways. Sometimes a 'manufacturer' is the works-owner himself, sometimes the works organization (for which we may say in Basic 'the maker'), and sometimes the name is used quite loosely for any sort of producer. 'Wages' is another word which is used loosely. Sometimes it is payment for work in a quite general sense ; at other times it is a special form of payment for work, different from a 'salary' or a 'fee'. The greater part of the discussion about wages has to do with payment for work generally ; but when the different forms of payment for work are being talked about, it is best to make use of a footnote.
    The fact that to put anything into Basic one has normally to be certain what it is one is desiring to say, makes it harder to put the writing of another into Basic than ideas which have been worked out by oneself. In a field like economics it is almost impossible to undertake such work without an economic training and a very good knowledge of what are normally taken to be quite simple and straightforward are seen to be so general that one's reaction to them is not one idea but a complex of ideas. 'Finance' is a word of this sort. "A knowledge of finance", "a change in public finance". "A finance organization" -- in all these uses there is room for doubt, and it is very much open to question if anyone who is not an expert ever gets clear picture of what is being talked about when words such as these are used.
    Naturally, in economics, as in every other special field, a number of words which the economist has come to be dependent on, are cut out of the Basic list. There are some, of whose loss only the ear will be conscious. Work for 'labor', money for 'currency' and so on are parallels which come very readily to the mind. With other words, the discovery of parallels may be a less automatic process, and, as we have seen, frequently it is necessary to get a word in its place in a statement or argument before coming to a decision as to how it may best be put into Basic. Naturally, the word-book, about which something was said earlier, would be the greatest help in this connection.
    Sometimes in economic writing, facts of industry which are in no way a part of the science are used as examples. In such connections a footnote may be needed, but frequently it is possible to make the same point in a more general form of statement. This was done in Stamp, where 'riveters' have been turned into 'steelworkers' (p 100) and 're-tapping fuses' becomes 'one special branch of the work', without damage to the argument.
    The question as to what words are international in economics has not been looked into with very great care, because probably there are not a great number which are international at the expert's level. When the general list is complete it will no doubt have in it a certain amount which of value to the economist. for the present we may make use of the business list, which gives us the important word 'capital;' and we may safely put with these cartel, laissez faire, boycott, and possibly quota. The position of entrepreneur is less certain, and it is sad that the good English 'undertaker' has become so limited in his interests.
    Names such as 'Cooperative Society' and 'Trade Union' are very like names of committees and government servants. We are still waiting for the decision of the committee of radio experts, and till their statement has been made, all such names will be given in their normal form.
    The reader who takes Basic for Economics seriously and is ready to put it to the test, may be kept from making the attempt by the fact that no list of Basic parallels is given for the common economics words. Such a person would get a very good working knowledge of the system if he went through the examples in this book and made a list for himself. The examples are so widely representative that it may safely be said that almost all the common words are covered, though it will be well to keep in mind that it is generally necessary to take into account the position of a word in a statement before putting it into Basic. -29-

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