FOOTNOTES
[173] Highway is sometimes used in the sense of greater importance and road in that of less, as in the expression “highways and roads.” Baker in his “Roads and Pavements” uses roads to indicate unpaved highways.
[174] See Engineering News Record, Vol. LXXXIII, p. 985.
[175] “Economies of Motor Transport,” by Merrill C. Horine, Engineer International Motor Company, New York City, in the Journal of the Society of Automotive Engineers, May, 1922.
[176] See Simonds’ “History of the World War,” Vols. I and V.
[177] “Am. Civ. Eng’s. Pocketbook,” Sec. 15, Art. 4, Wiley & Sons, N. Y.
[178] Report of Third International Road Congress, 1913.
[179] Bulletin 205, Cornell Agricultural College; Bulletin 136, U. S. Department of Agriculture; Bulletin 49, Bureau of Statistics, U. S. Dept. of Agr. Reports of the 1910 U. S. Census.
[180] From Bulletin 136, U. S. Department of Agriculture.
[181] Engineering Record, Vol. LXXIV, p. 439.
[182] See “Highway Engineering,” by G. R. Chatburn, pp. 22 to 28, Wiley & Sons, New York, publishers.
[183] Am. Soc. C. E. Proceedings, 1918, p. 2327.
[184] “Highway Engineering—Rural Roads and Pavements,” by George R. Chatburn, John Wiley & Sons, New York.
[185] “American Highway Engineers’ Handbook,” p. 1360, Wiley & Sons, New York.
[186] “The Scientific Selection of Pavements,” by W. W. Crosby, in Municipal Journal, May 29, 1913.
[187] “Modern Road Building and Maintenance,” by Andrew P. Anderson.
CHAPTER IX
EFFECT OF EASE AND COST OF TRANSPORTATION ON PRODUCTION AND MARKETING
The creation of economic utilities by the application of the mental and physical powers of man to the materials of nature is called production. Grass grew abundantly for thousands of years over the great plains of the Mississippi valley, but there was no production until it was utilized by the hand of man for economical purposes. Just so far as change came to that grass through the application of labor, physical or mental, or stored up in capital, there was production. Productive activities may be classified as those which have to do with: (1) a change in form, (2) a change in place, (3) a change in the potential time of use. Productive activities add to the materials as received other values, namely, form utilities, place utilities, and time utilities. The farmer through the processes of sowing, cultivating and harvesting, is instrumental in changing the elements of nature into grain, of adding form utility; it is transported over the roads and railways to elevators, thus is added place utility; it is there stored until needed thereby the third or time utility is attached. In the illustration just given wheat stored in the bin is considered the finished product. But a finished product of one productive activity may be the raw product of another. For instance, the wheat is taken from the bin and ground into flour, the flour transported to the place of storage, and held as a finished product until it is wanted by another productive activity in which the flour is the raw product. The baker takes the raw product, flour, molds and bakes it into bread, which is held by the merchant for sale. The wheat thus has passed through the three productive processes three different times. Other things may have passed through more before the final consumptive process occurs.
Production is very commonly thought of as being only the first one of the three operations, but the changes brought about by the transporter and the merchant are productive of economic wealth through the application of human physical and mental efforts hence are as truly a part of production as is the first operation.
The factors which enter into production are by some economists given as nature and labor, by others as land, labor, and capital. Under nature or land are included all natural elements, external to man, such as the forces of cohesion, gravitation, of moving air and water, and also the stored-up riches of nature. Under labor are placed all those things or utilities which have been added by the application of human endeavor, either mental or physical. Physical strength in and of itself is not sufficient, for the productive output increases with mental strength. The ox or the horse is capable of exerting greater physical force than is man, but without the guiding, directing force of man’s mind it would produce nothing. Moral qualifications are also placed under the general heading “labor” as they affect production. Temperance, dependability, prudence, frugality, etc., have in them productive elements of importance the same as the intellectual qualifications of quick perception, alertness, imagination reason and judgment.
Capital has been frequently defined as stored-up labor. It is the finished product of some previous effort, but as wheat and flour may be considered as intermediate products between nature and bread, so capital may be looked upon as an intermediate product between nature and more labor necessary to produce anew. “Its own origin, its existence, its subsequent action are nothing but stages in the continuous working of the true elements, nature and labor.”[188] Capital—raw materials, tools, machines, buildings, equipment, means for transportation and selling, stored products—is absolutely essential to more production, hence may be considered as an independent factor, although it may have been the product of previous labor allied to natural powers.
From what has been said it will be readily seen that transportation and marketing (selling) are a part of the process of production. Transportation can be divided into two classes: primary, transportation upon the public roads; and secondary, transportation on railroads, canals, steamboats and steamships. Marketing is likewise divided into two classes: wholesaling and retailing. The wholesaler buys goods in quantity from the manufacturer and sells them to the jobber who in turn sells them to the retailer. The jobber usually divides the larger purchased quantities into smaller or job lots in any quantity suitable to the retailer. The wholesaler and the jobber may be combined into one individual or firm. The jobber will, usually, not sell directly to the consumer; he sells only to retailers. The retailers frequently have a sort of “gentlemen’s” agreement with the jobber not to buy directly from the producer. This sort of complicated machinery often involves more expense than direct trading. After each of the transactions mentioned there is usually a change of place and a waiting in store.