Again when "normal" prices are contrasted with temporary or market prices, the term refers to the dominance in the long run of certain tendencies under given conditions.But this raises some difficult questions which may be postponed.(3*)5.It is sometimes said that the laws of economics are "hypothetical".Of course, like every other science, it undertakes to study the effects which will be produced by certain causes, not absolutely, but subject to the condition that other things are equal, and that the causes are able to work out their effects undisturbed.Almost every scientific doctrine, when carefully and formally stated, will be found to contain some proviso to the effect that other things are equal: the action of the causes in question is supposed to be isolated; certain effects are attributed to them, but only on the hypothesis that no cause is permitted to enter except those distinctly allowed for.It is true however that the condition that time must be allowed for causes to produce their effects is a source of great difficulty in economics.For meanwhile the material on which they work, and perhaps even the causes themselves, may have changed;and the tendencies which are being described will not have a sufficiently "long run" in which to work themselves out fully.
This difficulty will occupy our attention later on.
The conditioning clauses implied in a law are not continually repeated, but the common sense of the reader supplies them for himself.In economics it is necessary to repeat them oftener than elsewhere, because its doctrines are more apt than those of any other science to be quoted by persons who have had no scientific training, and who perhaps have heard them only at second hand, and without their context.One reason why ordinary conversation is simpler in form than a scientific treatise, is that in conversation we can safely omit conditioning clauses; because, if the hearer does not supply them for himself, we quickly detect the misunderstanding, and set it right.Adam Smith and many of the earlier writers on economics attained seeming simplicity by following the usages of conversation, and omitting conditioning clauses.But this has caused them to be constantly misunderstood, and has led to much waste of time and trouble in profitless controversy; they purchased apparent ease at too great a cost even for that gain.(4*)Though economic analysis and general reasoning are of wide application, yet every age and every country has its own problems; and every change in social conditions is likely to require a new development of economic doctrines.(5*)NOTES:
1.Schmoller in the article on Folkswirschaft in Conrad's Handworterbuch.
2.The relation of "natural and economic laws", is exhaustively discussed by Neumann (Zeitschrift fur die gesamte Staatswissenschaft, 1892) who concludes (p.464) that there is no other word than Law (Gesetz) to express those statements of tendency, which play so important a part in natural as well as economic science.See also Wagner (Grundlegung, 86-91).
3.They are discussed in Book V, especially chapters III and V.
4.Compare Book II, chapter I.
5.Some parts of economics are relatively abstract or pure, because they are concerned mainly with broad general propositions: for, in order that a proposition may be of broad application it must necessarily contain few details: it cannot adapt itself to particular cases; and if it points to any prediction, that must be governed by a strong conditioning clause in which a very large meaning is given to the phrase "other things being equal." Other parts are relatively applied, because they deal with narrower questions more in detail; they take more account of local and temporary elements; and they consider economic conditions in fuller and closer relation to other conditions of life.Thus there is but a short step from the applied science of banking in its more general sense, to broad rules or precepts of the general Art of banking: while the step from a particular local problem of the applied science of banking to the corresponding rule of practice or precept of Art may be shorter still.
