Accounting and Utilization of Resources

Abstract

This statement, written about 240 years ago, and couched in agricultural terms, can be readily applied to the current economic scene. We are crucially dependent today upon improvement in methods, more effective utilization of resources, in the struggle for economic growth and higher living standards. And I think we can still assume, as did Swift, that the activities of politicians will not be of much help in efforts to unlock the door to the land of plenty. Those fortunate enough to be living in areas where the economy now provides a relatively high level of output per capita need to be reminded from time to time of the fact that for the planet as a whole we are far from plagued with abundance. The plain fact is that the world is still faced with an acute problem of scarcity, all along the economic pipeline from the initial stages of productive effort to the final flow of consumer goods. Our resources are not such that we can afford to employ them in unpromising undertakings, or to permit capacity to be impaired by ineffective methods of operation. The central objective of economic effort, whether looked at generally or in terms of specific activities, is utilization of the available resources in such manner as to maximize output. This is the goal, in the sense of an ideal standard, at which those in charge of private productive enterprise commonly aim, and to which at least lip service is paid by many administrators of governmental operations. The Role of Accounting. That accounting is a major instrument in the drive to make two blades of grass grow where one grew before has long been