PURE ECONOMICS THIS book is the most important original contribution

to pure economics since Mr. Keynes' General Theory of Employ- ment, Interest and Money. Herein lies the reviewer's quandary. It is possible to offer a reasonably enduring first- reading judgement on restatements and modifications of generally accepted analysis—on books wherein the author's

aim has been to set down, in the words of Mr. Hicks' own happy quotation, " What oft was thought but ne'er so well expressed." It is also possible to do so on essays dealing with particular points of theory, unconsidered aspects or fresh applications. And it is of course easy to do so on the patently half-baked and second-rate (let alone third-rate and tenth- rate) volumes which amateur economics so plentifully engenders. But on a work of this kind, at once massive and path-breaking, comprehensive in scope and seminal in detail, such judgement would be an impertinence. It needs the long testing of controversy, that scrutiny which is provided by the current circulation of concepts, to assign to it its final rank

and role in the advancement of economic science.

To say so much is not, however, wholly to resign the critic's function. There are certain questions which the prospective reader is entitled to have answered: " What is this book about?

Is it to be taken seriously ? Is it easy—stiff—very stiff ? Is it decently written? " The second of these has already been answered. As to the first, the author may perhaps best be left to reply in his own words :

"I believe I have had the fortune to come upon a method of analysis which is applicable to a wide variety of economic problems. . . . What we mainly need is a technique for studying the inter- relations of markets. . . . We are naturally impelled to turn to the works of those authors who have specially studied such inter- relations. Our present task, therefore, may be expressed in histori- cal terms as follows. We have to reconsider the value theory of Pareto, and then to apply this improved value theory to those problems of capital which Wicksell could not reach with the tools at his command. . . . Similarly, when we come to dynamic problems, I shall not neglect to pay attention to the important work which has been done in that field by Marshallian methods—I allude in par- ticular to the work of Mr. Keynes."

The book falls into four parts. Part I is an elaborate and exhaustive revision of the Theory of Subjective Value— economics purely from the consumer's angle. (In parenthesis, any harassed beginner seeking light on that unholy device the Indifference Curve will find it admirably explained here.) In Part II, armed with the results of this analysis, Mr. Hicks tackles as promised the interrelations of a price system with many markets—sticking to a strictly static convention. Part

III moves from the static to the dynamic plane (so adding to the number of markets to be considered that in securities);

defines such dynamic concepts as Income, Saving, Interest, and sets the stage for Part IV—the Working of the Dynamic System, a theory of the economic process in time. Here are dealt with the sources of instability in our economic order and the " stabilisers " which more or less effectively reverse

its movements away from equilibrium; in other words, the trade-cycle and its genesis. These chapters have, as Mr. Hicks points out in his Introduction, a strong affinity with the analysis

of Mr. Keynes; but they are by no means an echo or re- statement. They rely less on particular assumptions as to prevailing psychology; and they are in their practical bearing more pessimistic. (Marxist comments on the last chapter should be great fun to read.) Practical proposals are, indeed, hardly more than hinted at; Mr. Hicks interprets severely

his limitation to theory. But he may fairly be summed up as holding that a tendency to wide fluctuations is an inherent

characteristic of, and not merely a pathological excrescence on, any dynamic capitalist economy; that monetary policy and public works (in the widest sense) can do much to damp these down, but can hardly abolish them; and that the survival of the whole system, however wise and well-timed intervention may be, depends on a constant or rising " rate of innovation "

with its concomitant investment opportunities. We stand on ground even shakier than we thought.

To the prospective reader's third question—how difficult is this book? the answer must be " Pretty stiff." It demands a good grounding in the technique of economic thought, con- siderable mental agility, and an acquaintance with at least the broad lines of recent controversy. That hazy entity the General Reader will find his work cut out to tackle it. But let anyone proposing to do so take heart from the answer to the fourth question—style; the presentation, with all its abstruseness and almost mathematical severity, is first rate. Logical elegance, the appropriate and economical expression of complex thought-processes, raise competence to the point where it provides a real if austere aesthetic pleasure.

HONOR CROOME.