130 THE GENERAL THEORY OF EMPLOYMENT BK. III

The analogy between this expedient and the gold-mines of the real world is complete. At periods whengold is available at suitable depths experience showsthat the real wealth of the world increases rapidly; andwhen but little of it is so available, our wealth suffersstagnation or decline. Thus gold-mines are of thegreatest value and importance to civilisation. Just aswars have been the only form of large-scale loan ex-penditure which statesmen have thought justifiable,so gold-mining is the only pretext for digging holes inthe ground which has recommended itself to bankersas sound finance; and each of these activities has playedits part in progress—failing something better. Tomention a detail, the tendency in slumps for the priceof gold to rise in terms of labour and materials aidseventual recovery, because it increases the depth atwhich gold-digging pays and lowers the minimumgrade of ore which is payable.

In addition to the probable effect of increasedsupplies of gold on the rate of interest, gold-mining isfor two reasons a highly practical form of investment, ifwe are precluded from increasing employment by meanswhich at the same time increase our stock of usefulwealth. In the first place, owing to the gambling attrac-tions which it offers it is carried on without too close aregard to the ruling rate of interest. In the secondplace the result, namely, the increased stock of gold, doesnot, as in other cases, have the effect of diminishingits marginal utility. Since the value of a house dependson its utility, every house which is built serves todiminish the prospective rents obtainable from furtherhouse-building and therefore lessens the attraction offurther similar investment unless the rate of interest isfalling pari passu. But the fruits of gold-mining donot suffer from this disadvantage, and a check can onlycome through a rise of the wage-unit in terms of gold,which is not likely to occur unless and until employ-ment is substantially better. Moreover, there is no