IOO

ESSAYS IN PERSUASION

PART

ing-rod, especially if it is unforeseen, maybenefit one group at the expense of the otherdisproportionately to any influence it exerts onthe volume of production; but the tendency,in so far as the active group anticipate a change,will be as I have described it. This is simply tosay that the intensity of production is largelygoverned in existing conditions by the antici-pated real profit of the entrepreneur. Yet thiscriterion is the right one for the community asa whole only when the delicate adjustment ofinterests is not upset by fluctuations in thestandard of value.

There is also a considerable risk directlyarising out of instability in the value of money.During the lengthy process of production thebusiness world is incurring outgoings in termsof money —paying out in money for wages andother expenses of production—in the expecta-tion of recouping this outlay by disposing ofthe product for money at a later date. That isto say, the business world as a whole mustalways be in a position where it stands to gainby a rise of price and to lose by a fall of price.Whether it likes it or not, the technique ofproduction under a regime of money-contractforces the business world always to carry a bigspeculative position; and if it is reluctant tocarry this position, the productive process mustbe slackened. The argument is not affectedby the fact that there is some degree of special-isation of function within the business world,in so far as the professional speculator comes