In his paper Baumol raised a number of important issues. Included are several knotty problems of an empirical nature: Can measures of outputs which we normally classify as services be reasonably divorced from measurement of the inputs of labor involved in their provision? Can commodities be satisfactorily divided into two classes: those for which the technology of production is inherently stagnant, and those for which technological progress is possible? It should be clear that in this paper no attempt has been made to address these or any other factual questions.