CH. 16 OBSERVATIONS ON NATURE OF CAPITAL 215

either to a positive or to a negative rate of interest;and it is, I think, only the scarcity theory outlined abovewhich is capable of this.

Moreover there are all sorts of reasons why variouskinds of services and facilities are scarce and there-fore expensive relatively to the quantity of labourinvolved. For example, smelly processes commanda higher reward, because people will not undertakethem otherwise. So do risky processes. But we donot devise a productivity theory of smelly or risky pro-cesses as such. In short, not all labour is accomplishedin equally agreeable attendant circumstances; and con-ditions of equilibrium require that articles producedin less agreeable attendant circumstances (characterisedby smelliness, risk or the lapse of time) must be keptsufficiently scarce to command a higher price. Butif the lapse of time becomes an agreeable attendantcircumstance, which is a quite possible case and alreadyholds for many individuals, then, as I have said above,it is the short processes which must be kept sufficientlyscarce.

Given the optimum amount of roundaboutness, weshall, of course, select the most efficient roundaboutprocesses which we can find up to the required aggre-gate. But the optimum amount itself should be suchas to provide at the appropriate dates for that part ofconsumers’ demand which it is desired to defer. Inoptimum conditions, that is to say, production shouldbe so organised as to produce in the most efficientmanner compatible with delivery at the dates at whichconsumers’ demand is expected to become effective.It is no use to produce for delivery at a different datefrom this, even though the physical output couldbe increased by changing the date of delivery;—except in so far as the prospect of a larger meal, soto speak, induces the consumer to anticipate or post-pone the hour of dinner. If, after hearing full par-ticulars of the meals he can get by fixing dinner at