OBJECTIONS CONSIDERED

of income denies my contention that savings are not in-come. One writer states this criticism as follows: “As afinancial fact, there can be no saving and addition tocapital value until there is first a property right to anincome calculable in monetary terms (a financial presentworth) to be saved. Hence to deny that monetary savingsare monetary income is in simple common sense to denya fait accompli; it is to assume the existence of the effectbefore its cause.” 6

In so far as our disagreement here is a matter of words,it may be that my terminology is at fault. I used theterm earnings to include capital gain and the term incomein the sense of the value of services rendered_by capital.There is little objection to changing this terminology,if we are willing to give up saying that capital value isthe capitalized value of expected income. We could thenmaintain that capital gain is income. But if incomeincludes only those elements on the anticipation of whichthe value of capital depends, then the increase in thevalue of capital is most emphatically not income . 7

In my reply to one critic , 8 I pointed out that this criti-cism seems to overlook, or omit, the mutual relations of

• Fetter, Frank A., Clark’s Reformulation of the Capital Concept.Economic Essays Contributed in Honor of John Bates Clark, pp. 151-152, footnote on p. 153; cf. also Flux, Irving Fisher on Capital and In-terest, Quarterly Journal of Economics, Vol. XXIII, Feb., 1909, pp.307-323.

T See my articles: Are Savings Incomet Journal of the American Eco-nomic Association , Vol. IX, No. 1, April, 1908, pp. 1-27; ProfessorFetter on Capital and Income, Journal of Political Economy, Vol. XV,No. 7, July, 1907, pp. 421-434; Comment on Professor Plehn’s Ad-dress, American Economic Review, Vol. XIV, No. 1, Mar., 1924, pp.64-67; and The Concept of Income in the Light of Experience, Eng-lish reprint from Wieser Festschrift, Vol. III.

' A Reply to Critics, Quarterly Journal of Economics, Vol. XXIII,May, 1909, pp. 536-541.