of change in the proportion of expenditure going into items of different degrees of durability must wait on further research.

In summarizing the structure of wants from the point of view of durability, the outstanding characteristic is the greater sensitivity to changes in expenditure with greater degrees of durability. This appears to be due both to greater expenditure on durable goods at higher levels of total expenditure and to greater expenditure with a transition from a lower to a higher level of expenditure. In the recent depression, the proportionate decline in the volume of consumer durable goods purchased appears to have been due not only to a lower and declining level of total expenditure but also to the relative inflexibility of the prices of more durable goods. 13

Specific Items of Consumer Expenditure

Further light on the structure of wants can be found by analyzing the purchase of specific items. In a recent report of the National Resources Committee 14 the production of each major segment of the national economy has been analyzed with particular reference to its sensitivity to changes in consumer income and to its trend of change through time. Since the production of an industry supplying consumer goods tends to parallel its sale to consumers, these analyses can be used as a rough guide to the behavior of consumer expenditure. In table VI below data are given for 39 items of con

13 See chapter VIII, p. 130.

14 Patterns of Resource Use.

sumer expenditure. The items are arranged approximately in the order of their sensitivity to variations in consumer income. As is to be expected, the durable items-automobiles, pottery, and furniture are the most sensitive. Next come the semidurable, then the nondurable, and, with some exceptions, the services. Railroad passenger traffic, telegraph, telephone, and postal service, and bituminous coal are only partly used by consumers, being partly used by business and government. Presumably the consumer uses are on the whole less sensitive than the producer uses, so that, insofar as production for use by consumer is concerned, the items should show less sensitivity than they do in the table. To the extent that knit goods are made up of stockings they are of comparatively short life and partake of some of the characteristics of nondurable goods. This differential sensitivity closely parallels that already shown for the durable, semi- and nondurable goods but by its detail it gives greater precision to this particular dimension of the structure of wants. One other dimension of the structure of wants can be sketched in from these same data, namely, the trend of change in consumer wants. Chart X below shows the trends of change in the purchases of particular items as they would arise if there were no variation in consumer income but consumers had the same income to dispose of year after year. Chart X gives a more significant indication of the structure of wants than would unadjusted trends of change which reflected variations in income as well as changes in wants. The chart shows the percent change in the amount of each

item purchased which would be expected between successive years if consumer incomes remained constant. There is no clear evidence that trends of change in wants are significantly affected by the factor of durability. The more significant downward trends are the trends away from pottery, leather boots and shoes, anthracite and bituminous coal, and domestic service.15 Even more marked is the trend away from railroad travel as the automobile and bus play a larger role. The more important upward trends are those in silk and rayon, knit goods, rubber goods other than automobile tires, canning and preserving, tobacco, paper products, and gasoline. These trends reflect a definite shift in the goods purchased. They may reflect changes in prices, particularly in the case of silk and rayon, the introduction of substitute items as the automobile displaces railroad travel, a change in tastes as in the case of tobacco or a variety of other factors, such as changes in the quality of product or in current conceptions of a balanced diet. Whatever the cause of the trends of change, they reflect the constantly changing, nonstatic character of consumer demands and give some indication of the dynamic character of the structure of

15 The declining trend in bituminous coal may be accounted for primarily by a declining trend in business use.

consumer wants to which the resources of the Nation must be geared in productive activity.

In the foregoing, an effort has been made to sketch in the main characteristics of the structure of consumer wants. Wants are important for economic activity because if there are no wants to be filled there is no basis for such activity. As long as there are wants to be filled and resources available to fill them, the basic essentials for economic activity are present. Analysis of the structure of wants has disclosed the dominant. role played by the desire for food, clothing, and shelter, more than 65 percent of consumer expenditure in 193536 going to fill these wants. Moreover, it has shown the tremendous residue of unfilled wants which would find expression in the purchase of goods if consumer incomes were sufficiently increased. The increased expenditure with higher incomes would be distributed over all of the major categories, showing that in none of them is there an immediate limit to the wants to be filled. The indications are clear that American consumers, if they had sufficient money income, would constitute a market sufficient to absorb all the production which American industry has the resources to turn out. It is not for lack of wants to be filled that economic activity is carried on at the low level of recent years.

The most concrete resources of the Nation are its natural resources-soil and minerals, forests and streams. Equally concrete is the plant developed by men-the homes and factories, dams and powerhouses, machinery and equipment, farm improvements and irrigated areas-all the man-made physical improvements. These natural resources and man-made improvements provide the physical resources available for further production and contribute to the structure of the American economy, particularly in respect to its geographical characteristics.

Of greater significance as a resource is the manpower of the Nation. Without the skills and the activity of

men and women, physical resources would be of no avail. Skilled farmers and workers, skilled craftsmen and technicians, skilled scientists, business men, politicians, artists, and homemakers-these and other productive workers constitute the Nation's greatest resource. The characteristics of the available manpower make up an element in the structure of the whole economy.

In addition to the natural resources, plant, and manpower which are available to be employed in satisfying consumer wants, there are other types of resources which condition the process of production even though they are not themselves consumed. These resources are (1) the climate and topography which condition the physical environment of production, (2) the techniques of production, developed in the past, upon which current activity rests, and (3) the social institutions which provide the social framework without which organized production could not take place. An equable climate, complex institutions, and modern techniques constitute

national resources no less than the natural resources, plant, and manpower.

These resources, the natural resources, plant, and manpower which can be used to satisfy wants, and the climate, institutions, and techniques which condition this use, constitute the basis of national well-being. The quantity and quality of national resources largely determine the degree to which wants of American consumers can be satisfied directly out of American resources. The location of both natural resources and man-made plants give to the economy much of its geographical structure. The organizational structure by which resources and wants are brought into relation to each other determines the extent to which these resources yield a high level of living or economic and social waste.

Natural Resources

As compared with other nations, the United States is richly supplied with cropland, forest, the basic mineral resources necessary for peacetime activity, and the strategic minerals upon which war industries depend. The soil and climate of the United States will permit the production of all of the major crops with the exception of such tropical products as rubber, tea, and coffee. Most of the industrially important minerals are available in the continental United States. Power is available in great quantities direct from the rivers and streams and generated from ample supplies of fuel. Since the country is waterbound on both the east and west, the resources of both oceans are available. Codfish of the east and salmon of the west as well as the other fisheries from oceans and lakes provide a significant food resource. In natural resources, the country is indeed rich.

The most significant structural aspect of the country's natural resources can be portrayed in a series of maps. Map 1 shows in relief the physical features of the continental United States, indicating the basic relationships of distance and accessibility which in a measure control the manner in which physical resources can be used. Maps 2, 3, and 4 show the forests still available, the land suitable for crops, and the land suitable for pasture but not for crops.

Com

In map 5 the value of farm land is indicated. parison of maps 3 and 5 shows the greater value of farm land in some areas, reflecting not only the better resource, i. e., more fertile soil, but also more favorable location in relation to markets. This farm land is much the most valuable of the country's natural resources. In addition to the surface resources of soil and timber, subsurface mineral resources of coal and oil, iron ore, and a host of lesser minerals make up the remaining value of natural resources. The geographical location of coal, iron, and oil deposits is shown in

chapter IV, maps 21 and 22, and appendix 16, map A-49, in connection with the location of industries working these minerals. The remaining minerals, minor in volume but of strategic importance, are scattered, primarily in the mountainous areas of the Rockies and to a lesser extent the Appalachians.

The richness of natural resources is emphasized by the small extent to which the economy draws on outside sources of supply. Although individual items of import are vitally important for specific purposes, the contribution of necessary imports to the whole economy is of minor proportions. As indicated in table I, approximately 43 percent of the total American imports in both 1929 and 1937 consisted of tropical products and the semitropical product, cane sugar. These items constituted 65 percent in 1929 and 79 percent in 1937 of the imports of all raw materials. Imports of minerals amounted to between 6 and 7 percent of the value of total imports. Together, imports of tropical products and minerals amounted to an insignificant figure in relation to the total national production, being equal to about 2 percent of national production in 1937. Even some of these imports, particularly sugar, did not result from lack of resources, but, like most other imports, were the result of the greater productivity of American workers and management in producing other things which could be exchanged for these products. Thus the dependence of this country on foreign natural resources is small in relation to total activity.

TABLE I.-Imports of tropical and semitropical products into the United States, 1929-371

Source: Bureau of Foreign and Domestic Commerce, Foreign Commerce and Navi gation of the United States and December issues of Monthly Summary of Foreign Commerce of the United States for the respective years.

1 General imports in 1929; imports for consumption in 1937. Includes imports from Hawaii and Puerto Rico.

Likewise, with a few exceptions such as rubber and tin, foreign resources are not of strategic importance either in peacetime or in wartime. The strategic minerals are listed in table II showing the peacetime needs as reflected in the amounts imported in 1929 and 1937 and the estimated war requirements. Many of these minerals are essential to the making of high grade