It is the same with the usance-value of all other material agents. The common nag and the thorobred horse, the loom for weaving rag carpets and one for weaving complex designs in silk, the scow and the yacht, are yielding uses which have differing values reflected to them from their final products, and accordingly they vary in usance-value. The same prin ciple applies in the case of human services. The labor-in come or the wage obtained by a man for his labor for a definite period is a reflection of the value of that labor to his employer, and eventually to the user of the product. In all cases the usance-value is a derivative.
§ 4. Effect of the presence of one agent upon the usance value of another. Let us now consider the effect which the presence of agents of inferior quality may have upon the usance-value of better agents. It is clear (see Chapter 12) that if two agents are of different grades of excellence, the better agent will be first used; but when there is sufficient demand, the less efficient agent will be pressed into service. Tho inferior as a whole, it has uses which are better than the lower grades of uses of the better agent, and we can speak of these uses as competing with, or as being substituted for, the more intensive uses of the better agent. Regarding the various uses in both objects as separable, we see that the total supply available to meet a given demand is increased by the presence of the inferior agent. The use of the inferior agent limits the utilization of the one of better grade, and therefore limits or lessens its usance-value. If there is but one grade of agent, it is necessarily valued without reference to any lower grade. There may be at first enough of the higher grade of agents to produce all the fruit wanted of the better quality. If, then, there is an increasing demand, and the additional yield can be secured only with more intensive utilization, the value of the product rises. The presence of inferior grades, however, limits that rise, because use can be shifted to them. Within the limits of substitution the poorer grades reduce somewhat the demand for the better grades. The usance-value of the better agents is due primarily to their scarcity and (not less important) to the scarcity of the more effective uses in those agents; but the substitutable uses in other available agents have their part in determining the par ticular level of valuation in any economic situation.
§ 5. Usance-value determining utilization. Both the quantity and the quality of products thus unite to determine the usance-value of an agent. A smaller crop of apples of
better flavor on one tree may equal or exceed in value the larger crop of another tree. In this case usance-values of similar things are compared. But through the value of the products they afford, very dissimilar classes of goods may be compared : the apple orchard and the peach orchard, the corn field and the field of potatoes. The constant comparison of usanee-values leads to the applying of each agent to the par ticular use in which it proves itself to have products of the highest value, and to the shifting of the use when a sufficient change of value takes place in the product. For example, a field used for corn becomes, as population grows, worth more for market gardening than for residence sites, and later be comes worth still more as a business location at the center of trade. The land has various possible alternative uses at any moment, but that one is to be chosen which secures the highest net yield.
§ 6. Time as a factor in usance-value. Each instant that an agent is in use may, if we choose, be counted a separate use, and usance consists of the sum, or succession, of net uses yielded in some limited period of time, as a day, a week, or a single season. It takes time for the separate uses to be realized. The series of uses bound up in an agent can not be secured at any single moment. If a fruit-tree were per manent, and the owner could wait through eternity for its yield, he would get an infinite yield of fruit. But in any finite period, there can be only a limited yield. When uses% of different periods are compared, as this year's use and the next year's use, or the use during some year in the more dis tant future, another problem is involved, that of time-value./ Moreover, time is an element in the comparison of the present values of products that are of various degrees of ripeness or readiness. A wagon can be used in June for hauling a fam ily to the circus or for hauling a load of wood to the home to cook a meal the next December; or a horse may be used for an afternoon's drive, or for dragging timbers to build a cot tage to be used for a life-time. Here the usance is in the present, whereas one of the alternative uses is present and direct, and the other is indirect, resulting in future income. Inevitably the element of time enters in most cases into the estimate of usance-value. We must, however, postpone for a few chapters the fuller analysis of this factor.