ch. 17 PROPERTIES OF INTEREST AND MONEY 225

If there were some composite commodity whichcould be regarded strictly speaking as representative,we could regard the rate of interest and the marginalefficiency of capital in terms of this commodity asbeing, in a sense, uniquely the rate of interest and themarginal efficiency of capital. But there are, of course,the same obstacles in the way of this as there are tosetting up a unique standard of value.

So far, therefore, the money-rate of interest has nouniqueness compared with other rates of interest, butis on precisely the same footing. Wherein, then, liesthe peculiarity of the money-rate of interest which givesit the predominating practical importance attributed toit in the preceding chapters? Why should the volumeof output and employment be more intimately boundup with the money-rate of interest than with the wheat-rate of interest or the house-rate of interest?

11

Let us consider what the various commodity-ratesof interest over a period of (say) a year are likely to befor different types of assets. Since we are taking eachcommodity in turn as the standard, the returns on eachcommodity must be reckoned in this context as beingmeasured in terms of itself.

There are three attributes which different types ofassets possess in different degrees; namely, as follows:

(i) Some assets produce a yield or output q ,measured in terms of themselves, by assisting someprocess of production or supplying services to a con-sumer.

(ii) Most assets, except money, suffer some wastageor involve some cost through the mere passage of time(apart from any change in their relative value), irre-spective of their being used to produce a yield; i.e.they involve a carrying cost c measured in terms ofthemselves. It does not matter for our present pur-

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