THE THEORY OF INTEREST

to produce these results. We are here merely noting thefact that lack of foresight is one factor present. JohnRae ’s characterization of the Indians both of North andSouth America as highly improvident and lacking inforesighted thrift is based on personal observation andthe testimony of missionaries and travelers . 5 The negroesof Africa are perhaps even less provident than the Ameri-can Indians.

In many if not all of the cases which have been citedthere are, of course, other elements which would tendto explain the facts besides mere mental characteristics.Thus, the high rate of interest among the negroes andthe Russian peasants is undoubtedly due in part to then-poverty, though their poverty is in turn due in varyingdegree to their mental characteristics. Where there is toolittle appreciation of the needs of the future, capital tendsto disappear; and the pressure of poverty tends to en-hance still further the demands of the present and topress down its victims from bad to worse.

Not only do we find examples of high rates of pref-erence for present over future goods among the prodigallyrich, but often we find low rates of preference for presentover future goods among the thrifty poor. Examples areespecially frequent among the Scotch, the French peas-ants, and the Jews, whose propensity to accumulate andto lend money even in the face of misfortune and socialostracism is well known.

The factor which has been designated as “regard forposterity” deserves special attention. Perhaps the mostconspicuous example of extreme disregard for posterityis found in Rome during the time of its decline and fall.Rae stresses the decay of family affection, the growth of* The Sociological Theory of Capital, pp. 71-72.

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