For John and other interested parties:

I was writing about Clark the scientist. If you buy Georgism, you are 
easily led to regard Clark as an apologist. On the other hand, if you 
take the entrepreneur point of view, you presume that all wealth in a 
pure market economy is the result of either entrepreneur action or luck. 
In the entrepreneur view, a thing or action is a resource if it is 
recognized as a means of satisfying wants, such as the things and 
actions discovered by butchers, bakers, and brewers regarding how they 
can benefit others and, in the process, earn an income. Otherwise a 
thing or action is not a good or resource.

This is as true of land, space, and other Georgian sources of so-called 
unearned wealth as it is of the discovery of electrical power, the 
personal computer, and so on. If you do not accept that, under market 
economy conditions, a thing or action is a resource only if it is 
recognized as such by someone acting in the role of the entrepreneur; it 
is understandable that you would reject the marginal productivity theory 
and the Austrian theory of value and cost. But, then, you must defend 
the Georgist view. I see that view as indefensible, although it certain 
functions as a rallying point for people searching for a way to tax the 
assumed unearned increment. (If you care to follow up, Davenport among 
others, carved up the single tax idea; I have a paper on this that I 
will be happy to share.)

The marginal productivity theory, in Clark, is not an effort to describe 
reality, which contains all sorts of indivisibilities and non-economics 
factors. It is an effort to formalize the assignment of money values to 
resources (things and actions). In this sense, it is conceptually like 
the theory of gravity. A person who attacks gravity theory because it 
does not explain the rate of descent of a feather simply does not 
understand the purpose of the theory. (It was not recognized until 
later, that what the marginal productivity sought to do was to formalize 
the ENTREPRENEURS' assignment of money values.)

Private property rights means that all consumer goods and resources are 
appropriable and owned by some person. This assumption is made in order 
to help formalize the tendency described in the marginal productivity 
theory. Davenport understood this better than anyone when he objected to 
the use of the theory to justify the personal distribution of wealth in 
the US.Davenport pointed out that in a real capitalist economy, as 
opposed to the pure market economy used to represent the tendency, a 
large part of the wealth was due to expropriation, robbery, theft, and 
deceit. Burglar tools are capitalized, he pointed out, in the same way 
that construction tools are. (It is even possible that Davenport was 
criticizing Clark for making this error and therefore for being an 
apologist for those who expropriated land from the American Indians, 
since Davenport spent a significant portion of his life on the frontier 
in South Dakota. I have not tried to determine who he was referring to.)

If you do not see the purpose of the marginal productivity theory, you 
will not understand why the assumption of private property rights is 
useful. Indeed, you may not understand the meaning of the assumption. In 
that case, it will be easy for you to interpret the assumption of 
private property as part of a program of apologetics, particularly if 
you believe that Clark is defending people who you think should be taxed.

By "the emergence of entrepreneur thinking" I was referring to the 
thinking of some economists, most significantly Davenport, Knight, and 
Mises. This thinking began to emerge in the US with the development of 
the idea of capitalization (Frank Fetter and Irving Fisher, for example) 
around the turn of the 20th century. "Who, in a pure market economy, is 
responsible for capitalizing prospective future streams of income and 
utility?", the leaders in this train of thought had to ask. Who assigns 
the money values to durable goods and resources, and why? The answer?  
They are assigned by the entrepreneur role and they are assigned, 
roughly, according to the principle of marginal revenue productivity.

There was a type of entrepreneur thinking in the writings of earlier 
economists like Cantillon and Say. However, until economists began to 
conceive of a role that assigns values to capital goods, the earlier 
economists were not fully taking the entrepreneur view, which is what I 
mean by entrepreneur thinking (of economists).

Pat Gunning