Living Reference Work Entry

The New Palgrave Dictionary of Economics

pp 1-2

Date: Latest Version


  • N. De MarchiAffiliated with


‘Abstinence’ was Nassau Senior’s term for that conduct for which profit is the reward (1836, p. 59). He meant it to convey two things: ‘both the act of abstaining from the unproductive use of capital, and also the similar conduct of the man who devotes his labour to the production of remote rather than immediate results’ (1836, p. 89). The term he knew was not ideal, but it was preferable to ‘providence’, which implies nothing of self-denial; and to ‘frugality’, which implies care and attention, that is, labour, which analytically Senior wanted to keep distinct from the agent of production rewarded by profit. For the same reason he chose not to speak of profit in relation to ‘capital’. Capital usually combines the services of natural agents, labour and abstinence, but it is desirable in an analysis to keep their several contributions distinct.