In our preliminary view of the making of goods we have had to do entirely with forces, physical and social. Wealth is produced by the operation of physical forces on material substances. These forces are under man's control, and it has therefore been necessary to consider the social conditions of economic activ ity, as well as the physical conditions upon which it is based. In the study of consump tion we have to do with utilities. A utility, in its concrete sense, is that which satisfies a de sire. A good, or commodity, is the material substance in which a utility or a group of utili ties is embodied. We are therefore viewing in a different way the same goods into the making of which we have already had glimpses.
The making of goods would be described with perfeCt accuracy as the creation of utili ties. Although in industry no matter is created, matter which was without the power of satisfying desire is put into such form, or removed to such place, as to endow it with that power, or, in other words, to create utili ties which did not before exist. Consumption is the destruction of utilities in such a man ner that the satisfaction which the commodity was able to produce is actually experienced. The test of consumption is the degree of satisfaction obtained. It is obviously an error to look upon the creation.of new utilities as a test of consumption, and to condemn all con sumption from which there does not emerge a greater number of utilities than is de stroyed. A destruction of utilities from which new utilities emerge, is, strictly, not consump tion at all, but one form of production. The shoemaker, it is said, consumes leather in the production of shoes. But the utility embodied in the leather has disappeared in the one form only to reappear in another. It has not been destroyed. No want has yet been satis fied. Something very different takes place when the shoes are worn out. Here the utilities are destroyed. The desire, whether it be for ornament or for protection, has been satisfied. Nothing else than this should be called consumption, unless some qualifying word is added to indicate the meaning.
We may use the term " productive consump tion" to designate the transformation of utili ties from one substance to another, when no desires are satisfied in the process.
Waste is a destruction of utilities from which there is obtained neither new utilities nor the intended satisfaction. Nearly all con
sumption involves some measure of waste, and, though to a less extent, the productive process too is accompanied by waste. A fail ure to create the greatest number of utilities with a given expenditure of energy, must be regarded as waste, and consequently those forms of consumption which allow existing productive agencies to be utilized most fully must be regarded as least wasteful. It goes without saying that it lies in the interests of all to reduce to a minimum the waste in each of these directions. The most urgent need of all is for greater economy in consumption, as will appear more fully in subsequent pages.
Production and consumption together cover the whole field of man's economic activity. The consumption of wealth 1 is uniformly accompanied by the sensation of pleasure. The degree of pleasure varies directly with the utility of the commodity. The utility is indeed only an expression of the possible satis 1 Wealth is a collective term including all kinds of commodi ties. Anything which possesses positive utility, as defined in the next paragraph, is wealth. See opening paragraph of Chapter I.
faction to be derived from the commodity. There is no necessary or direct connection between the effort involved in the production of the commodity and its utility. The two may, however, be directly compared, for pro duction always involves some degree of pain 1 or subjective cost, which is a sensation di rectly opposed to the pleasure obtained from consumption. The whole science of eco nomics rests upon the possibility of thus com paring pains, or subjective costs of production, with pleasures obtained as a result of eco nomic activity.
In investigating the facts concerning con sumption we shall early find some among them that cannot readily be reconciled with the simple conception of utility above set forth : viz., that utility is the power of satisfy ing desire directly, and that consumption is 1" Pain " is the word commonly used as the name of the sensa tion opposed to pleasure, though there are objections to its use, because of its association with disease or other abnormal physi cal conditions. Subjective cost has the same meaning. The word " cost" alone is used in this sense by Cairnes and other writers. As so used the word " cost " must not be confused with money costs. It means the actual dis-utility experienced in production.