nation as amounting to £1,700,000,000 per annum, we must regard that money income as represented by a real income consisting partly in consumable material goods consumed during the year, partly in material goods non-consumable which constitute “savings” and form an increase of the forms of capital, and partly in non-material goods which are either consumed as “services” or saved as personal capital, i.e. increased power of producing services.
It must be clearly understood that here is no attempt to break down the ordinary limits of wealth and income adopted for the purposes of economic science. We do not include in real income all the intellectual, artistic, and other output which might be loosely regarded as part of the “wealth” of the nation, but only such part as is actually bought and sold.
§2. While, therefore, it is allowable and convenient to restrict “industry” for some purposes to the production of material wealth for markets, we cannot apply such restriction in a philosophic consideration of the industrial prosperity of a nation. All forms of non-material wealth which are produced, sold, and consumed by the nation must be regarded as forming part of the real income of the nation equally with food and furniture; and the energy which goes into the production of this wealth must rank as industrial energy. Unless thinking persons will consent entirely to ignore the old cleavage between material and non-
