Summary and Analysis
Book IV: Chapter I
Generosity or liberality is the mean in matters pertaining to material goods (i.e. money and everything whose value is measured in money). The two extremes related to it are extravagance or prodigality and stinginess. All are concerned with giving and taking, although to different degrees. Stinginess is the quality of attaching too much importance to material things; prodigality is a self-destructive vice, for wasting one's own material goods is a self-destructive act.
Wealth is a commodity meant for use, and like any object can be used well or badly. Just as any particular object is used best by the man who possesses the virtue appropriate to that object, wealth is used best by the generous man. He is characterized by giving or spending for the right reasons, at the right times, for the right purposes, and to the right people. The motive for his generosity is always noble. Generosity must be evaluated in terms relative to a man's property, for a generous act depends not only on the amount given but on the motives and characteristics of the giver. It is often the case that a man who gives less is more generous than the man who gives more, because his gift comes from smaller resources.
Extravagance is an excess in giving and spending and a deficiency in taking. Stinginess is a deficiency in giving and spending and an excess in taking. Extravagance has more in common with generosity than does stinginess. Stinginess, which is further from the mean, is considered the greater evil because most people are prone to error on the side of stinginess, not extravagance.