>From Carl Menger's Principles: In the early stages of civilization and even later in the case of small manufactures, entrepreneurial activity is usually performed by the same economizing individual whose technical labor services also constitute one of the factors in the production process. With progressive division of labor and an increase in the size of enterprises, entrepreneurial activity often occupies his full time. For this reason, entrepreneurial activity is just as necessary a factor in the production of goods as technical labor services. It therefore has the character of a good of higher order, and value too, since like other goods of higher order it is also generally an economic good. Hence whenever we wish to determine the present value of complementary quantities of goods of higher order, the prospective value of the product determines the total value of all of them together only if the value of entrepreneurial activity is included in the total. Menger, Carl. (1981) Principles of Economics. Translated by James Dingwall and Bert Hoselitz. New York: New York University Press. Originally published in German in 1871. In the translation, the translators refer to "factors in the production process." It is also worth mentioning that the investigation of words is hardly as useful as the investigation of ideas. That Menger understood the idea of factors of production in the modern sense of the Austrian theory of value and cost or the marginal productivity theory of distribution is evident. I did not check Jevons but I must assume that he understood these also, as did Walfas. However, one should not homogenize these founders of the idea. Nevertheless, there is a definite break between the classical economics and neoclassical economics, stemming from the notion that the value of various factors in the pure market economy is derived from a combination of (1) the utility of the product to the consumer and (2) the consumer's spending power. Each of these writers implied some version of consumer sovereignty. The Concept of Consumers' Sovereignty W. H. Hutt The Economic Journal, Vol. 50, No. 197. (Mar., 1940), pp. 66-77 At JSTOR. Best wishes,. Pat Gunning