880 H. STANLEY JBVON$ for the people of some locality. or the nation at large, for the present time and for a number of years, the burden of paying be extended benefit lasts. work, irrigation over If the cost of the number important an such benefit of years harbor ought to which the improvement canal, or trunk line of railway be constructed, it is likely to remain in use, or at least the greater part of it, for seventy or eighty years. It is obvious then that the whole cost of construction should not be paid for by the present generation, but future generations should contribute thereto. This is usually done by constructing public works out of borrowed money and arranging for the repayment of the loan either by. insraiments extending over the period for which the work is estimated to be likely to remain in service or by creating a sinking fund or reserve which will grow at compound interest to the amount of the loan at the end of the estimated period of its duration. All modern authorities expenditure necessary for reproductive undertaking are agreed that the capital the works and plant of any to be constructed by the State can be fiuanced properly by means of a loan, so long as serviceable the loan is repaid life of such works during the and plant estimated either by insraiments or by the accumulation of a sinking fund,. There are three other expenditure which according
may justifiably be met by means of a loan, although in these cases all authorities are not agreed :-- classes of non. recurring to economic principles district by increasing the social income, and are capable of providing an indirect monetary return in the shape of additional taxation, which could easily be collected from the class of persons who benefit there- from. A good example would be the construction of (1) The most easily justified class is that of public works which conduce to the economic welfare of a
