D.1. Order-Wise Dependency of Good Character:
I. From Causal Order of Goods, it is clear that all goods in a causal order derive their good characters from good characters of their immediately lower order of goods and ultimately the first order of goods derive them by being the cause of satiation of a human need.
III. In the Causal Order of Goods, any good is considered to have Good Character i.e. a Good only because it directly or indirectly serves a human need, absent this condition, it can be excluded from Causal Order of Goods.
Axiomatic Derivation:
1. It is immediate from 4 and 5 in Causal Order of Goods that the entire causal order exists only to satiate human needs which in turn can be satiated if the two problems in 1 of Causal Order of Goods are solved i.e. transforming provisions of nature into consumable goods, and mitigating uncertainty. Hence, every good at any level in the entire causal order of goods acquires a good character only because it solves the two problems only for the ultimate goal of satiating human needs. And when viewed systematically, for analysis, we say that good at order 'i' is a good because it serves the needs of goods at order 'i-1' which in this manner ultimately reaches good of order 1 which serves a human need.
2. For a longer exposition kindly read below.
Explanations:
E.1. From Schema in E.4. of Causal Order of Goods and visual below __, it is clear that any good is a good only if it is necessary for the development of something which can cause gratification of human needs. If it does not, whether it is a raw material, an intermediate good, a consumption good, a service, or whatever, if it serves no human ends, it has no Good Character (See Good).
E.2. Consider the following example for elaboration:
Suppose we are camping in a forest. Suppose we feel hunger and we have something which needs to be boiled before eating. This boiled food is our first order good which at the moment does not exist. So for boiling we collect the firewood around us which has fallen from trees. This fire wood was all around us, and we did not think of it for a moment until now. Now as we felt hunger and discovered that we need fire for boiling, it now acquires a good character.
Suppose further that this fire wood needs to be chopped. Now, it requires an axe, another good. Let us go back to the beginning when you were planning this camping expedition. And that moment, if you had failed to predict a scenario of chopping wood, you would have not considered an axe to have any good characters at all. And it is also possible you would never need an axe in this expedition, but you nevertheless are a cautious person and predict all contingencies, and feel the need of an axe. Thus, a perceived need for time planned ahead, gives good characters to the axe.
This axe does not serve our needs directly. It cannot be eaten or drunk. It can, however, have various uses of which the most important is chopping wood. This wood too does not serve us directly but it can be used for fire. Fire again may have a direct use such as when temperature falls, or in darkness, or it may still serve us indirectly, say by boiling water. Boiled water cannot be consumed either but can be used to boil some vegetables, say potatoes. This boiled potato is what can be consumed directly for gratifying our need - hunger.
Thus, everything from axe to potato via firewood, fire, boiled water, is now connected by logical or practical necessities with our hunger, and has good character accordingly.
E.3. The conclusion is that anything acquires a good character only if it is necessary, even under a single contingency, for gratification of our needs, and regardless of how indirect it serves human need so long as it always performs a necessary function it is Good.
E.4. Schema of the Order-Wise Dependency of Good Character.
______________ (To be appended later)
Reference: Menger, Carl (2004). Principles of Economics, Online edition, The Mises Institute, 2004. (Chapter 01 page 63-64)