Eugen von Philippovich: Review of Robert Meyer’s Das Wesen des Einkommens (1889)

In this German review, Philippovich examines Meyer’s theory of income, challenges its aggregate-first method, and distinguishes its restrictive definition from its valuable account of income as a process.

The discussion begins with competing definitions:

Zwei Abgrenzungen des Begriffes Einkommen sind bei den Volkswirthen als „herrschende“ Meinung im Umlaufe.

English translation: Two delimitations of the concept of income circulate among economists as the "prevailing" opinion.

One defines income as goods available for satisfying needs without diminishing wealth; the other emphasizes regularly recurring receipts. Following Meyer, Philippovich observes that the first makes preservation of wealth, rather than satisfaction of needs, the governing economic aim. It also admits inheritances and windfalls contrary to ordinary usage. The second leaves recurrence insufficiently determined. The review sharpens this difficulty through a contrast between wages and annuities:

Soll der unregelmässig wiederkehrende Arbeitslohn kein Einkommen, dagegen der regelmässig wiederkehrende, aber Capitalersätze enthaltende Bezug von Annuitäten Einkommen bilden?

English translation: Is irregularly recurring wages to constitute no income, whereas the regularly recurring receipt of annuities, which contain replacements of capital, is to constitute income?

Regularity alone cannot distinguish income from repayments of capital, while irregularity threatens to exclude recognizable earnings.

Meyer seeks a firmer basis in the economy-wide process rather than private transactions. Consumability and recurrence remain essential, but national income comprises only immediate consumption goods. Their renewed provision is an economic objective, not a condition of their present consumability; replenishment responds to needs rather than merely to an arbitrarily chosen accounting period. Individual income is assigned a corresponding scope, with monetary receipts standing in for consumption goods where they do not reimburse capital. Philippovich follows the implications for different income forms, the relationship between national income and the sum of individual incomes, and the security of recurrence.

The last issue exposes a central weakness. On Meyer’s account, most income forms lack assured recurrence. Receipts of artists, writers, and especially workers consequently become doubtful instances of income. Philippovich argues that this threatens an even greater departure from ordinary usage than the definitions Meyer criticizes.

His methodological objection concerns the priority accorded to national income. Treating that concept as metaphorical, Philippovich proposes beginning with the individual, as in theories of value and price. Such a starting point need not neglect the complications introduced by wider economic exchange. The disagreement concerns explanatory order, not whether social economic relations matter.

Despite these objections, Philippovich recognizes useful analyses of gross and net income, losses, saving, and the services yielded by goods, including their relevance to taxation. Most importantly, he welcomes the shift from an isolated quantity of goods to a connected succession of receipts. Income should be understood through its formation and receipt rather than simply as a stock. This dynamic insight, he maintains, does not depend exclusively on Meyer’s definition of recurrently produced consumption goods. The review thus separates a productive account of economic process from an overly restrictive recurrence criterion and a disputed national-to-individual method.