Capital and interest

My only reasons for writing a preface to a work so exhaustive, and in itself so lucid, as Professor Böhm-Bawerk's Kapital und Kapi talrins, are that I think it may be advisable to put the problem with which it deals in a way more familiar to English readers, and to show that the various theories stated and criticised in it are based on interpretations implicitly given by practical men to com mon phenomena.

First, to state the problem. A manufacturer who starts business with a capital of £20,000 takes stock at the end of a year, and finds that he is richer by £2000-that is to say, if he sold plant, stock, and debts at a fair valuation, he would obtain for them £22,000. The increment of £2000 he will probably call his "profit." If asked to explain what is the origin of profit in general, and of this amount of profit in particular, and, further, why this profit should fall to him, his first answer will probably be that the goods he manufactures meet a want felt by a certain section of the public, and that, to obtain the goods, buyers are willing to pay a price high enough to allow him, over the whole field of his production for one year, to obtain the profit of £2000.