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PEINCIPLES 



OF 



ECONOMICS. 



^^m. 



» ^ " M 



P'V'7 



PEINCIPLB8 



OF 



ECONOMICS 



BY 



ALFRED .(MARSHALL, 

norwmott or nojncAL iooitokt ut «hb mnvsuirr or oambbidbi ; 
rmuLOir or bt josh's aoLX-mm, CAitBRi'Dom ; 

■DUKTIMB rXl.VOW Or KALMOt. COU-IOI, OXrOBD. 



^>ecr'i. 



datura non /oeft taltutn. 



Ixmlion: 
MACMILLAN AND CO. 

AND NEW TOBE. 
18d0 

[AU SighU retenedi 



330 

v./ 



A 



15^5 



0iiBfanIl([t: 

PSIHZZl) BI C. f. CLIT, ILl. AND BOIS, 
AT THK UMmBSnT PUSS. 



PREFACE. 

Economic conditioDS are constantly changing, and each 
generation looks at its own problems in its own way. In 
England, as well as on the Continent 'and in America, Eco- 
n<Hnic studies are being more vigorously pursued now than 
ever before; but all this activity has only shown the more 
clearly that Economic science is, and must be, one of slow 
and continuous growth. Some of the best work of the 
present generation has indeed appeared at first sight to be 
antagonistic to that of earlier writers; but when it has 
had time to settle down into its proper place, and its rough 
edges have been worn away, it has been found to involve 
no real breach of continuity in the development of the 
science. The new doctrines have supplemented the older, 
have extended, developed, and sometimes corrected them, 
and often have given them a different tone by a new dis- 
tribution of emphasis ; but very seldom have subverted 
them. 

The present treatise is an attempt to present a modem 
version of old doctrines with the aid of the new work, and 
with reference to the new problems, of our own age. Its 
general scope and ptirpose are indicated in Book I.; at the 
end of which a short account is given of what arc taken to 
be the chief subjects of economic inquiry, and the chief 
practical issues on which that inquiry has a bearing. In 
accordance with English traditions, it is held that the 
function of the science is to collect, arrange and analyse 




n 



PBEF4CE. 



od hirV 



I 



economic facta, luid to apply the knowledge, gsdned by 
obscHi'ation and experience, in determining whnt are Uknly 
to be the immediate and ultimate effects of various groups 
of causes ; and it iti held thnt the Iaws of Economics 
statement* of tendencies expressed in the indicative moo^ij 
and not ethical pi-ccept« in the imperative. Economic la 
and reasoniiDge in faet are merely a part of the ma 
which Conscience and Common-sense have to turn 
account in wiving practical problems, and in laying down 
rules which may be a guide in life. M 

But ethical forces aix-t among those of which the eco-" 
nomist has to take account. Attempts have indeod been 
made to construct an abstract science with rcganl to tbo 
actions of an "economic man," who is ander no ethical 
inBuences and who puraues pecuniary gain warily and 
energetically, but niec:Kanicatly and Ksltishly. But they 
have not been »iicc>u)%ful, nor even thoroughly carried out. 
For they have never reaJly treated the economic man as 
perfectly eclfiah : no one could be relied on better to onduro 
toil and sacrifice with the nnselfisli desire to make pnnri- 
aun for his &mtly; and hijs normal motives have always 
been tacitly aeeumed to inclnde the &mily affections. But 
if they include the«o, why should they not include all other 
altiiiistic motivOB the action of which is so far uniform in 
any class at any time aiid place, that it can be reduced to 
general rule i There seems to be no reason ; and in the 
present book normal action is taken to be that which may 
be expected, under certain condition.<i, from the members of 
an industrial group ; and no attempt m made to exclude the 
influence of any motives, the action of which is regular, 
merely becaunc they are altruistic. If the book has any 
^XMnal character of its own, that may perhaps be said to 
lie in the prominence which it gives to this and othei- ap- 
plications of the Principle of Continuity. 



PREFACE. 



TU 



rinciple is appHed not only to the ethical quality 
^-of tlie motaves by which a man may be inSueuced in 
duKnng his ondit, but al»u to the RagHcity, the energy 
wd the eutei-priae with which he pursues those ends. 
Thia sttess 'iB l&id oq the &ct bhitt there is a continiiuuK 
gnuUtJOB from the nctions of "city men," which are ba«ed 
gn deliberate and far-reaching calculations, and are executed 
»hh figDUr and ability, to those of ordinury people who 
havf bvithur the power aor ttic will to conduct their aSaire 
b a boaiiieas-like way. The nomial willlugness to save, the 
Miml (riltiDgnoes to undergo a certoin exertion for a certain 
pecnmaty rewnn). or the normal aleitncw to neck the best 
iDufcetsin which to buy and »el), or to search out the most 
xlviDtagooufl o<»upatioD for onef^elf or for (mfi's children — 
•Htbese and similar phrases must be relative to the mem- 
bm of a particular class at a given place and time : but, 
"bta (hat is once undenttood, the theory of normal value w 
l^ifitablo to the actions of the uubasinc^ss-likc clnssos in tho 
9mt way, though not with the same precision of detail, as 
lo tlicw of the merchant or banker. 

And u there is no sharp line of division between conduct 

whidi b nomuU, and that which han to hf: provisionally 

Mg^ected as abnormal, so there ia none between normal 

nines and "earreut" or "market" or " occawonal " values. 

tV^ latU.T arc those values in which the occiilenta of the 

Bunent exert a preponderating iiidnuncc; while normal 

nines are tho«c which would be ultimately attained, if the 

nanomic conditions under view had timu to work out un- 

distiiihed their full effect. Bui there is no impaasable gulf 

■ptireeu these two; they shade into one another by continn- 

^■os gndations. The values which we may regai-d as normal 

^^w« are thinking of tb© changes &iom hour to hour on n 

Produce Exchange, do but imlicatc current vaxiations with 

i^an) to tho year's hist<ffy: and the normal values with 



Till 



P&EFACE. 



reliifmoe to ihc ycAr's higtoay u« but curreat values with 
refemtoe to the history nf the century-. For the element of 
TinM, which is Uie centre of the chief difficulty of almost 
erety ecoDomk probleai, is itRclf abnotatclj continuonii :.■ 
Nature knows no absolute partilion of time into Icmg periods 
■nd abort; but the two shade into one another by iinpt'rmjp 
tiblo gradations, and irba.t is n short period for one problem, _ 
ta a long period fw another. V 

Thus for ingtance the grvater port, though not the whole, 
of the duAinction between Rent and Interest on capital turns 
on the length of the peritKl which wc have in view, llial 
which is rightly regarded as interest on " free " or " floating " 
capital, or on new InTeatments of capital, is more properly 
treated as a sort of rent — a Qtiagi-ratt it is called below — ou 
old icvestmeats of capit&l. And there is do sharp line of j 
division between floating capitol and that which has been 
" sunk " for a special bmuch of prtxluction, nor between new 
and old in^'ostmentfi of coital ; each group ahadeit into the] 
other gradually. And thus even the rent of land is 
not 88 a thing by itself, but as the leading upecies of a large 
gemw; though indee*! it hai> peculiarities of its own which 
are of vita) importance from the point of view of tbeot)' aa ^ 
well as of practice. f 

Again, thotigh there w n sharp lino of division between 
man himself and the appliances which he usee ; and though 
the supply of, and the demand for, human efforts and sacrifioes 
have peculiarities of their own, which do not attach to the 
supply of, and the demand for, material goods; yet, after all, 
these material goods are themselves generally the result of j 
human effortR and sacrifices. The theories of the values of] 
labour, and of the things made by it, cannot be separated: 
they arc parti) of one great whole ; and what dilTercucee 
there are between them even in matters of detail, turn out 
on inquiry to be, for the moat part, diffei-ciices (^ degree < 



PREKACB. 

ntfcffjt"* of Hml. Ar, in *«pitc of the great differenci^ in 
ftmHetveen birds nnd quadrupt^dH, th«r« U utie Funda- 
mental Idtifl ruQniiig tlimu^li all their frainea. so the 
gmtai theory' of the eqiiilibriiim of demand and supply 
a a FluidAmentat IdoA runuiug ihrougli th^ framus of all 
tb0 various parts of the central problein of Distribution and 

Another applicfttion of the principle of Continuity is to 
Ihetae uf t«ni)s. There has always been a t«inptation to 
dunfj ecuiiotnic goods in clearly delined groups, about 
tttth a atimbcr of nhurt and Hhar|i propoKitions conld be 
nude, to gratify at odco the Ktiuk-iit't« dc«irc for logical pre- 
dtM, and the popular liking fur dugmas that have the air 
■iT bang profound and are yet easily handled. Hut great 
miKbief Aeein« to have been done by yielding to this temp* 
litiofi,aad drawing brnnd artificial lines itf division whej^ 
Sitnro h&g made none. The more simple aud ab»<>lut« an 
nnwoiic doctrine is, the greater will be the coofusioa which 
it briugB into attempts to apply eeouotnic doetrineK to prac* 
lite, if the dividing Uues to which it refent cannot be fnund 
iina) life. There h not in real life s clear line of division 
hctween things that ckre and are not Capital, or that arc 
ud are not NeceKsariea, or again between labour that is and 
■ BO* Pruduetivci. 

The notion of continuity with regard to developmcnC is 
coHMoti to all modern schools of economic thought, whether 
tbe chief iuflueuees actiug on them are those of biology, an 
nfnaeated by the writings of Herbert Speucer; or of history 



' k tba Ktanomia of fiukurrn pnlilidin] by tny irifi- utiil mjeelt in I8J9 wi 
uilKHmr «v nrnle to Blimr tlie iiklurv of thU tiiiii^BinriiUl nTilty. A ■hoit 
FWUmJ aimntit of Um ivIatioM n( HdiuuhI uiiI mpply «u kIim) Iwtnre l]i4< 
tt«>7 tl DiatribvtiMi : kikI then tltlN nnu uhimiB of npumti nH>niuiR n u 
flBti b Monnlm lu Uw f»Tuiii(pi <if \ai>oar. the laUrMt on nplUI bu'I the 
bnap •( WannTW-Bl But tli«> <lriti ••! Lliin omiigmiMiC w*« nnl mid* 
«M«Ut cImt: wid on ProlcMor N)r1ii>lik<n'ii MjptMtiuu. muov tir-iuiuvM* bM 
kM|b«i lo U lu itw [wwaail Toliirnr. 



X PB£FACE. 

and philosophy, as represented by Hegel's Philosophy of 
History, and by more recent ethico-historical studies on the 
Continent and elsewhere. These two kinds of influences 
have affected, more than any other, the substance of the 
views expressed in the present book ; but their form has 
been most affected by mathematical conceptions of con- 
tinuity, as represented in Coumot's Principe* Mathdmatiquea 
de la Thiorie des Richessea. He taught that it is necessary 
to iace the diflSculty of regarding the various elements of 
an economic problem, — not as determining one another in a 
chain of causation, A determining B, B determining G, and so 
on — but as all mutually determining one another. Nature's 
action is complex : and nothing is gained in the long run by 
pretending that it ia simple, and trying to describe it in a 
series of elementary propositions. 

Under the guidance of Coumot, and in a less degree of 
von Thiinen, I was led to attach great importance to the 
tact that our observations of nature, in the moral as in the 
physical world, relate not so much to aggregate quantities, 
as to increments of quantities, and that in particular the 
demand for a thing is a continuous function, of which the "mar- 
ginal'" increment is, in stable equilibrium, balanced against 
the corresponding increment of its cost of production. It is 
not easy to get a clear full view of continuity in this aspect 
without the aid either of mathematical symbols or of dia* 
grams. The use of the latter requires no special knowledge, 
and they often express the conditions of economic life more 
accurately, as well as more easily, than do mathematical 
symbols ; and therefore they have been applied as supple- 
mentaiy illustrations in the footnotes of the present volume. 
The argument in the text is never dependent on them ; and 

1 The tenn "murginal" moremeot I borrowed from Ton Thijnen, and it 
is now 000100111; uMd t^ Gtermui eeonomiata. Wbeo Jerons' Theor; appeared, 
I adoirted bia word "floal" ; but I have been gradiullf couTinoed tlut "margiiutl" 
U the better. 



PHEI'ACE. 



Zl 



'l>e uroilted ; 1>ut I'xperiunce iieein.1 to ^how that 
■• firmer gnuip uf miiii^r' iinjKtrtant principles tliau 
cube got without their aul; oiid that there are niau}' pru- 
Ucfot oJ' pure theory, which do one who haa once learnt to 
OM diagnuiu will williugly buucllu in any oth«r way. 

Tbo chief use of pui'o mAthomntics in oconoinic quostio&ft 
mm lo bo in helping a persou to writi? do^m ciuickly, shortly 
uA exflctly, some of hut thoughu for his own use : aud to 
nab smw that ho has iinongh, und only uuou^h, prumiasus 
brhk coDcluMoiix (ie. thai hU c({uation8 arc neither more 
IM leas in namb(;r than hin uiikuowus). But when a great 
iDHj S)'mbok have to be ii»iod, Ihuy bocoiiie very laborious 
M ttj DDC but tlm writer hiintiulf. Aud though Cvurnot's 
gntDi mast give a new mental activity to everyone who 
Vmte through his hand!>, and mathematicians of calibre 
Bunilir to his nmy use their favourite weiipous in clearing a 
n| for themselves to tho centrv of »iome of those difficult 
iroWans of economic theory, of which only the outer fringe 
hii fet been toui^ed ; yet it neems douhtful whether any 
Mti ipeods hb time well in reading lengthy trannilations 
rf economic doclriiiea into mathcmalies, that have not 
been made by hinuM:!! A few specimens of those apptica- 
liou of mathematical language which have proved most 
wW for my own purposes have, however, been added in aa 
Appendix'. 

' Hmbj ot tine ili>i:TiuiiB in Ihia book lutvu ftpporiHl in prim alivti^ : and I 
MVUbtUuB oppmlaiuty of kI^uW ^^^f liixIorT. Mr U«uiry Cnii^iBliainn nlio 
*M UhMUiif toj laotONa In 1973, tetduji mv BiiiiorBil li; buiijc uualtlu to ilraw 
SMiMi It netaagnlu LyptTlnUs. iuvculwl • boBUlitiil and ori^m] niBobiiio tor 
<bi|«I>«««. tl wtnAt/tnx >l lU* C(uiil>ri>Un Riiliwiji'liiriLt tvH,-»'tj i(i 1)478; unil, 
teafltni iU KM, I rra4 » p«|xr IlinoBj rvpoitvd id Uio I'rociriiii^f. Vvi xr, 
ft- n«-ri, in ^Uh I daMifb«d Uie UwotIm of MulUpIii r-MftiaiK of Eqai- 
Onm ud af Msuopoly nloim rerr umrl; a» Qicy are itlieii liulow (Buuli v. 
Ck. 1. uid Tm.). In 1VTS— T I DMrtj cconplfM *. draft oT ■ trnntiRr on Tltt 
Jitty «/ fartigm TruU. nrilk stmt alliat proUemt reUiliny to the itoclrme lif 
I'f^ir Fair*. Th« Hnt taxt of it wki tntatidcil far gciioK] tun, wlUle Um 
"OBf hn WM tedinleftl; nurij »31 tkt diagnuos tlikt u^ naw lii BAttb v. 
& ■, ni. ind no. w«rn Introlnowl b It, In couDvctloii with [La problun of Ae 



ZII PBEFAGE. 

I have to acknowledge much assistance in preparing this 
volume for the press. My wife has Elided and advised me at 
€very stage of the MSS. and of the proofs, and it owes a 
very great deal to her suggestions, her care and her judg- 
ment. Mr J. N. Keynes, and Mr L. L. Price have read all 
the proofs and have never returned nae any without improv- 
ing them much : Mr Arthur Berry and Mr A. W. Flux have 
given me valuable help in connection with the mathe- 
matical Appendix; and my father, Mr W. H. B. Hall and 
Mr C. J. Clay have assisted me on special pointa 



rdation of ProUction to the Mnimnm SatufRctioa of the oommnni^; uid there 
were othera relAting to Foreign Trade. Bnt in I8TT I turned aside to work at 
the Seonomics of Indiuirs, and afterwards was overtaken 1^ an iUneea, whicli 
nearly HOBpended m; stndiea for several fears. UeanwbUe the USS. of IU7 first 
projected treatise were lying idle : and it is to them that Professor Sidgwick refers 
in the Preface to his Political JCeoiiomif, With my consent he selected four 
chapters (not consecutive) out of the second Part, and printed them for private 
circulation. These four chapters contained most of the sabstauce of Book t. 
Ch. V. and vn., bat not Cb. vin. of the present work ; together with two chaptara 
relating to the eqailibriom of foreign trade. They have been sent to many 
economists in England and on the Continent : it is of them tliat Jevona speak* 
in the Preface to the Second Edition of his Tkeorii (p. ilv] ; and many of the 
iliagranis in them relating to foreign trade have been reproduced with generous 
.acknowledgements by Prof. Pantaleoiii in his Princiiiii di Keonomia Pura. 



CONTENTS. 

£/ia/»e« crrw u*»d to gitt rt/tiitnoet t» <UjiniU»tu of te«^»icai Ierru4.] 



BOOK T. 



PRELIMTNABV 81TRVEY. 

Chapter L Introdaction. 8 1. BooDomic* is both « study of ««aiUi and 
» btaucb of tht auidy uf man. The himorjr of tli« wurld biu> tiraii alisiMNj 
b]i nli^Dtw and eeonomie furt«K. ^ 'J. The i)Li«Klit>n wlioih.'r poverty i( 
atammtj giTW iU It^hcal tnUNst to eoonoEnitf*. J j. T|]« mmdcq )■ in 
ll> OMta of rMtnt grnwtb. $4. ThcfniidlunwDtBl <iharaol«rbtieof ntodeni 
hwfami is no* oompctltioD, but Fret indmtry and 4nteTjTiM. | S. Piu- 
Snfauj aeeotuit fif fiifu« ]>p. t— 9 

QbqUr U. Tba Orowtli or Free Indtutiy aad Eatcrpriiitt. I L. 

tlignioal gaum* luit moit pow«rftilly Ln the early stages at drUizfltioa, 

«liMi tuv« iMeaanrilj IbImid pUo* in «t»rni elimftU*. In an larljr 

dtQiaMioa normnml it tiowi but them b iuovciiiodi. utd cuiit«i& if 

t^mrPf ■ diMBniaed fonii of Nlatr-moTLng onm|ictitiuii. j! 'i. Divided 

oniBaUp ittengtlieBi the tone of eiurtoiu utxA ratbta ehuigot. Tbe In- 

Boance vf dwtotn on th« oiclhods of ioduflrj ia vninnUtive. % 8, Tb« 

liRak* broQKlil Northun nutrgjr to bMf on Oriuital cnlturit, Uod*ni 

ia ounj rwpccta, the; yrt regarded induEtr? an lK>lonf;ini{ to fllavos, 

ud Ibdt iHiptlkmw of atcady tDdii«to' "*><> (^ ^^l"^ cause of Uwir 

UL I i. Tha itnnittb of oliaiact«r of tba fiomana tlttixl ilina fur 

I twiHn. bm tbajr protetred to haiiufi- w^dtli bjr the swuid, a.ai tboe 

Mvtcd little dind indacuix- ou toooouiic aeicoco: but the Stuiu |l]li!o^cphJ 

lod tbe oo*aMii)olitan ri|icrinice of the later Itouian lawj^'ia l*d th«ui 

I padnally to Hilary the apbare of oootmct. | G. The T«uUii ^on to lr«rn 

I tn« Hum *lw(a bu bad conqntnd. LoaniiEiR kept aliro I; the iJimiMU. 

fttttoatioo moTcd noclhwardB and w«»lward(i. and tha old cutitunt tiatveati 

I loaa aoil vianiry leriied. }j ti, 7. Sclf'g(ji>enun«nt by the [leojili; eoubl 

Uul otdj ia tbo f(o0 towoa ; which wcrv the prcoui'iK>n of aiodcni iadDitiial 

^_ arainlioD. I 8. Tbc uiAaonoaof Chiraliy and of ihcCliDrcli. ThegroKtli 

^H of lanp armiM lad to the oTanbtov ol tb« free cities. Udi tbe bopua of 

^H fMptM w«« again raiwvd by ih« invention of pnotioK. thv Ikfoiiualion, 

^P ladlhidlaaotcnroltbeNewWoiU. g ». The firet benoSt of the luarttiuie 

1^^ Unniilu NCDt to tbe SpaiUali peninnila. But aoon tnoT^id faTthcr on. to 

HidUlid, to Pianoe, and to Eo^atul pjK 10— M 



XIV CONTENTS. 

Obapter m. The Orowth of Free Indnstiy and Enterprise, eonttnned. 

§ 1. The oharsoter of EngliBhmen. While etill an agrioiiltaral nation 
tbej shewed aigna of their modern tsMvltj for organized action. Their 
trade haa been a oonsequenoe of their activity in production and in naviga- 
tion. The capitalist organization of agricnltnre pioneered the waj for that 
of mannbotore. §3 S, 8, Infinence of the Reformation, g 4. Origin of 
large basinoBs undertakings. English free enterprise had a tendenoj to- 
wards division of labont, which was promoted b; the growth of oonsumars 
beyond the seas, wanting large quantities of goods of simple patterns. The 
undertakers at first merely organized supply without supervising industry: 
but later collected into Uieir own factories lai^ bodies of workeiB. 
g a. Henceforth tnanafiictnring labour was hired wholesale. The new 
organization increased production, but was aooompanied by great evils ; 
many of which were, however, due to other causes, g 6. The pressure of 
war, of tases and of the soard^ of food forced down real wages. But the 
new system had saved England from French armies, g 7. As the oentnr; 
wore on, the nation became richer, and vas no longer compelled to saorifioe 
everything to increased production. The telegraph and printing-press 
enable the people now to decide on their own remedies for their evils. And 
we are gradaally moving towards forms of collectivism which will be higher 
than the old, because they will be based on strong self-disciplined in- 
dividuality, g 8. The influence o( American and Ofirman experience on 
England pp. 81—49 

Chapter IV. ThaGrowtiiof EoonomicBcienee. g l. Modem economic 
Bcienoe owes much to ancient thought indirectly, but little directly. The 
study of eoonomioB was stimulated by the disooveiy of the mines and the 
trade-routes of the New World. The early fetters on trade were a little 
relaxed by the Mercantilists, g 3. The Physiocrats insisted that restriction 
is artificial, and liberty is natural; and that the welfare of the common 
people should be the first aim of the statesman, g 3. Adam Smith 
developed the doctrine of free trade, and showed how value measures 
motive, g 4. The study of facts was carried on by Young, Eden, Ualthus, 
Tooke and others. % S. Ths English economists at the beginning of the 
century were many of them baBinese men, but they had a strong bias 
towards rapid generalization and deductive reasoning. Their work was 
excellent so long aa they treated of money and foreign trade, nor did 
they neglect statistics and inquiries into the condition of the working 
classes. But they lacked the Comparative Method, g 6. They did not 
allow enough for the dependence of man's character on his circomstuices, 
a point on which the Socialists insisted ; whose influence gradually made 
itself felt, g 7. The growing tendency of economists to take account of 
the pliability of human nature is partly due to the influence of biological 
studies. John Stuart Mill. Characteristics of modern vork. g 8. French, 
American and Qerman eoonomistB pp. 50 — 71 

Chapter V. Methods of Study, g l. Comte did good service in insisting 
on the unity that underlies social phenomena, but failed to show that there 
ii no use in making special studies of certain olasses of them The German 



COSTKUTS. 



wtoj cf hirtwiod aaononJot. %i. Eoonomia (ncU miiiirc to bo CAr«Aill7 
BHqntod bjr maan. {8. Indncliun and d«du«lioii mtibiBlly dapend oa 
Bw uotber yp. 73—77 

QlplVTL Economic Motlns. t l- KoouomioH doo not k^H man u 
wnlj Mlfiafa; bal il oouci'ins Itatlf cluefly witb thota niotiveu irbinh ore 
—I ■Ml), ftDd wliOM «o£ion out, thontora, Ira radtiam] to Uw and onade 
*i Htjtit of MieiitiBe malnMil. | 2. Tbo taoliv« of Borning noae; 
im nM QuHtide oUmt ocawidnnitioiu ; caoh m Lho ploHue affordad by (he 
9fak liMir uid thL> iiitUa«t or power. The high«Rt motiiea &re for the 
ff»tt»r p«rl n(<o-mM<iankbl«. S«lf-r«gArdUig mcftiurmble motives mv not 
jBMBMoljr ol & lav oidor. { 3. BasInBtifl wui'k haa genonlly a nuiney 
DMaoN. Ttui nnge of flconomic miwnurumunl tuny gndoKlly oxumil lo 
naoh philnothropiD Mtion. Tli« motir«» to o»llactim aotion ar* ot grc«t 
■aj gmring impoiUnoe to llie Moaainitt. j 4. Ooatoin la An inortin, 
wtfrtin cbmgB pp. 7d — BS 

(kptar VIL The Nftturs of Eeonomie Law. S !• Tbc raogo of oao- 
maiN U» ia Ibe *mu« m thai of vcouumU uiotivea. Dtfiniligns of Lav 
Md.VenuiJ. jS. Tbetnuhiiiary of (cienee should be Il«xib1«. Itthotild 
■l»^ h* UMd ru far kb il will rawli, althauuli in avuiy owui Cotnmoa SouM 
U Utcnllimatc kibikr of pniotimi mUoh. Th« Uw* of eoonodiiot are Bot 
pneqiu. { S. All adeiitifia doetrioM tacitly or ImpHdlly aiiauine om- 
Ota eofxlitioos. and tn in tbit anus bypothotlool. But in monamion tlifl 
laqplM oooditioaa tmnt be tmphuiaed. The aeopc of oiononuc rcusoniiig 
li vide, ihat of tatcli p«rtkiil*r doctrine Is narrow pii, AO— so 

ChftarVIlL 8aiiuaaT7 and Oonclauon. si- Sammary. j3. 8o(ai< 
tifle inqotriM ant to bo ^miiRi'ii irit)i ri;1'iinLnci<, uot to t)i« ptaotio&I luma 
«faidl llwy widsMrTC, bnt U> tin- natuif of tltti mi^Lctn vith which iLcy aic 
wawnieiL | S. Tbe chief aufcjecte of cootiomic InvenUgation. §4. Pru> 
Hat iMOM which Mlnuilala Ibe ioiiuiheii of the Enyliali seonomiHt at Ibe 



ItMotl tims 



pp. til— 08 



BOOK II. 



SOME FUXDAMENTAL NOTIONS. 



^■^ir L OUBKiflcitlon. The Dse of T«nDB. 9 I. Pricnlpb:* of 
^r ckMlflcatiDn. 'Vhn <li&iulti<« of elaMi^ng thlcKS whi«b nra dtADglng 
<ktr dianwtcn aod thdr Base. ( 2. EMtnomioa mD*t follow the praotice 
offfWyxlaf life; but Uial U not always dcdiuita or eonaictODt: fui diflartnt 
•Umm of tkin^ iilud* off tBip«r<«ptibIy towarda oao aaolhcr. J 8. Baob 
tan ntM hare a deflnition oomspoiidiDg to it* leading imc: and tlifa 
MM ba iniiplatnaaiud by ao tntepratatioR claiuw whea naonituiy 

pp. 101—105 

62 



XVI CONTENTS. 

Ohaptor U. We&ltiL S !■ Good* are to be regarded fint from the point of 
view of the individnal. Internal and External good*. Material good*. 
External penonal good*. Internal perianal good*. TraiuferabU and turn- 
tratuferablt good*. The individual's share of coUeetive good*. Free good*. 
Exchangeable good*. Gooda of the Jint, weomi and higheronfera. Contump- 
lion and production good*. §§ 3, B. ProviBiooat definition : — a person's 
wealth oonsiatt of his external goods. Exchangeable wealth. % 4. Social 
wealth. National wealth. Cotmopolitan wealth. The jnridio&l bauB of 
rights to wealth pp. 106—116 

ObStfftet TTT Prodactire. § 1- Man oannot produoe matter, bnt onl; 
utilities inherent in matter. % 3. Prodnetive is a transitive adjective; 
when precsision is neoesBai; the implied substantive moat be supplied 

pp. 116—120 

Ohapter IV. NeceBSaries. § 1> Keoesaaries for ezistence and necessarieB 
for effldenoy. % 3. There is waste when any one oonsumes less than is 
necessary. Conventional neeetiariet. Man can oonBnme, as be can produoe, 
only ntUitiea pp. 121—125 

Ohapter V. Capital. § l- ^e term Capital has many different uses. In- 
dividual capital includes Trade-eapital. § 2. Two attributes of capital; 
prospeotiveness and prodnotiveness. Social capital. Coneamption capital. 
Auxiliary capital. The necessaries of the higher as well as of the tower grades 
of industry moat be inolnded. § 3. Potential capital. % 4. Circulating 
and Fixed capital. Specialized capital. Permmal capital. HistoridilNotk 
on Definitions of the Term Capital pp. 126—138 

Chapter yi. Income. Si- Total Real income. Moneyincome. Elements 
of real income not in the form of money are likely to be overlooked. 
§2. Social income. §3, Net income. 8 4, Corresponding to inlerMl of 
capital is utanee of wealth. Profit*. Earning* of Management. Rent. 
S 6. National income better measure of general eoonomio prosperity than 
national wealth pp. 189—144 



BOOK III. 

DEMAND oa CONSUMPTION. 

Chapter L Zntrodnctory. § l. The relation in which the present Book 
stands to the three following, g 3. Little attention has been paid til] 
recently to Demand or Consumption; bat several causes are now bringing 
it into greater prominence pp. 147 — 149 



CONTENTS. XVU 

(SlApter n. The Law of Demand, fi l. Hnman wants and deslreB are 
tariona, bnt faw of them are altogether inoapable of meaanrement. Price 
IB a EoeMDre ot deainbUi^ or utility, f 2, Individnal diflerenoeB may 
be neglected vhen we are considering general tendencies, g 8. A 
distant pleasore generally affords a weaker motive than one close at hand. 
The nnoertaintf of an anticipated pleasnrs as aSeoting its "disooanted " 
value, g 4. Marginal ot Final Utility and Total Utility. § 5. Any par- 
ticular want is generally satiable. The laio of the Diminution of Marginal 
■rtili'ty, g 6, The distribution of a person's means between the gratifica- 
tions of different wants; so that the same price measnres eqoal ntilities 
at the margin of different purcbascB. gj 7. B. The Demand SeheduU. The 
meaning of the tenn an inerea$e of demand. The Law of Diminution of 
Ma^inal Demand-price pp. 160 — 161 

Chapter TU- Elasticll? of Detnaud. g l- Definition of Ehutieity of 
Dewiaud. gg 2, 3. A prioe which is low relatively to the rich may be 
high relatively to the poor, g 4. The demand for necessaries, gg 6 to 8, 
Difficulties in the way of obtaining the requisite Btatietics pp. 162 — 174 

Chapter IV. The HeasTiTement of the TTtUlty of Wealth, g i. Price 

and Utility. Ccamtmen' Rent, g 2. CorrectiDns to be made: firstly on 
aecount of diSerenoefl in the wealth of different purchasers. Beoondly on 
account of elements of ooUectiTe wealth which are apt to be overlooked. 
g 3. Beraooilli's suggestion. The edge of enjoyment blunted by fiumili- 
arity. The value of leisure and rest. Excellenoe of a moderate inoome 
obtained by moderate work, g 4. Expenditure for display. Superior 
nobili^ of collective over private use of wealth. Tostefal parchoMs educate 
the producer pp. 175 — 183 



BOOK IV. 

PRODUCTION OR SUPPLY. 

Chapter I. Introdactory. gg 1. 2. Marginal dirutility. Although labour is 
sometimes its own reward, we may i^ard its supply ae governed by the 
price which is to be got for it. The Supply Schedule for a commodity. 
Supply Price pp. 187—190 

Chapter IL The Fertility of Land, g l. The notion that land is a 
tree ^ of nature while the produce of land is due to man's work is not 
strictly accurate : but there is a truth underlying it. g 2. Mechanical and 
chemical conditions of fertility, g 3. Uan's power of altering the character 
of the BoiL g 4. The original qualities count for more, and the artificial 
for less, in some cases than in otfaers. In any case the extra return to addi- 
tional capital and labour diminiahes sooner or later pp. IBl — 199 



XYIU CONTBNTS. 

OhapteT m. Tbfl Fertility of Land, contliiiud. The Law of 

Dimlniflhillg Setnm. I 1> Land ma; be Dnder-oultivated and then 
extra capital and labour will give an Increasing Betnm nntU a maiimnm 
rate haa been readied, after which it will diminiah again. Improved 
methods oulj enable more capital and labour to be profitably applied. The 
Law relates to the amonnt of the prodnoe, not ita valne. Final otatanent 
of the Law. § 2. A Dote of capital and labour. Marginal dote, marginal 
return, TOargin of cuUivotion. The marginal doae is not neceasarily the 
last in time. Smplut Prodvee. Its relation to rent. Bioardo confined hit 
attention to the oircDmBtaooes of an old ooontr;. § 8. Eveiy measnre 
of fertility muet be i«Iative to i^aoe and time. § 4. Ae a role the poorer 
Boila rise in value relatival? to the richer ae the pieaaure of population 
inoreaaes. % 5. Bicardo uid that the rioheat lands were cultivated first \ 
this is true in the sense in which he meant it. Bnt it is apt to be misondei- 
stood; as it was faj Carey, who has oolleoted striking inetanoes of new 
settlers passing by lands which have nltimately become the most valoable. 
% 6. Bnt Bioardo had underrated the indirect advantages which a dense 
population offer to agricnlture, and this has an important bearing on the 
doctrine of population, g 7. The Laws of Betom bom fisher^, mines 
and building ground. Notx on the meaning of the phrase "a Doae of 
capital and labour" pp. 300— SIS 

Chapter IV. The Snivlr of Labour. The Grovth of Nnmbeis. 

K 1, S. History of the doctrine of population. § 3. Malthns. g§ 4—6. 
Causes that determine marriage-rate and birth-rate, gg 7> 8, Bistoiy of 
population in England, g 9. International statisttaa pp. 338 — 844 

Ohapter V. The Supply of Laboor, contlnaed. Health and 
Strength. SS li ^- General conditions of health and strength. . § S, 
The neoesxaries of life, g 4. Hope, freedom and diange. g fi. Infloenoe 
of occupation, g 6. Infiuenoe of town life. ^ 7, 8. Nature left to 
herself tends to weed out the weak. But much well meant human action 
checks the increase of the "strong, and enables the weak to Burvivc The 
State gains from Urge families of healthy children . pp. 34fi — 369 

Ohapter VI. The Supply of Laboor, continued. Indnstilal 
Training, gg 1> 3. Unskilled labour a relative term. Skill with which 
we are familiar, we often do not recognise as skill. Uere manual skill is 
steadily losing importance relatively to general intelligence and vigour of 
character. Oeneral abiUty and specialiied ikiU. gg 8i 4, 6. Liberal and 
technical edncatiou. Apprenticeships, their past, and their possible future, 
g 6. Education in art. g 7. Among the higher grades of industry 
pannts discount the future at a low rate, bnt at a high rate among 
the lower grades, g 8. Mill thought that the industrial classes were 
divided into four well marked grades. But all such slurp linee of division 
are tending to fade away, g 9. Sommary of the three ch^ters on 
the Supply ol Labour pp. 300 — 388 



CONTESTS. 

'Otpter Vn. The Growth of Wealth. S 1- Tiaa nou^r Knn 
•u little uu: (if af4-nuvt tonim of •uiilini7 oapiuJ; Int tUuf •>■ nmr 
liwiinc 'Mt, M u ftbo tbo poww W •coumulatv. g i, Tlw weigluttg of 
bMn bnafita aKftliut pnwBi hu Al^v* bean the chief motin of the 
moDulatioD e( wooltb : but tbo growth of timdu uid the insNudiig tih of 
nuHT Ud to tho lutbit of mcMDrinB iho bnuiov of wulth in vwrj form I17 
lis inMreal tfaai ooald W sot tor tha lout of caoney. g 3. Tlw poet- 
foHHitnt of gmsificallou wlUeh i« giiourall/ involval in tho ■cumnuUlIon 
qf WHtth, bu b««a wUtd mUHne»t^:. but la betbu dnortbed lu u>aiti'njr. 
f 1. Socoriljr «a a eoodiiioB of aavia^. f &. The gTO«ili o( o aioner 
teimtaay gfVM nm l«fnpt«liaiM to eitntv&g&nw : but it haa cnablad peopio 
«bo liAra no bctilty fo*- btiiiinaafl to n^np th« fmita of Mivtitg. | 6. Th* 
dHef iDOtito of uTiitg b bmilr ftOtwlion. § 7. Saurc«a of aoonmil* 
bItOB uf MfttarUI uid PetwiiMt enpiuil. TIih fjubllo acctmiuUliuui of demo* 
tttdit*. Cooperation, g S. Th« iniluiiitoo on oooiuniilntion ^i^rted lij a 
Ul in th« ntt« of intcrasl is not ro iojorioDS At was BuppoMi ranD«rl]r. 
19. Coneltiaioa pp. tMSm 

ym. Indutrial Orsamization. gj i, s. The doetiiDs i3iat 
(tBMitftlion iatavtJti* otbciniiCT U a\A, bnt .^dtia Smith m^ 't ft b<w lifb. 
Inoemisu aad blologlstii have woiked 1«^clIioi in fxuiuuiiig iht InllueDcs 
tUth tb« Mtraggl* for varvivo] neitu oii ui^ntxation ; iu hMrnliract fiaiturM 
Mllaiod by h«r«dily. 3. Anoi«nt omIm and modi:?]) ola«*«a. gg 4, &. 
UatDSmhh more oandoat than manjr of his foUovgr*: Ihcii indLscriEiuiiato 
tolORJci et Baturm] URBBlxatloa. Tbay took loo litUc aoeouut of the 
^mbpoMnt ot beultiM bj dm pp. 804—909 

Slplar tX. Indnatrial Orxviizatiozt, eontinaed. Divisicn of 
labour. Thelnflaenceof Uadtiuery. ! i- I'lactico makct pcrfL-ct. 

1 1. Tn tho hnrer. but not alwv* ■>> l^iB hiiihur, gnidDii uf work mtruiue 
Umllliiiliim inaraasos officionajr. | S. Blbohinrty tnkoA ov»r noonvr or 
bUr aD nMootoiMiu mxk In manufaoluie, and after a tint: rvqoiroi Isaa 
ud iMa itBt^iii)^ I 4. Maohinfr-iimdc niBehiii4iTy is intrnduititig tht! new 
Ifa tit iBtwobaDgaabk Parta. | r,. lUuntrftlion fiotu tito priDtin^ irttde- 
1 6. Maehinery ttUerea the slraln oa buuian muiwteii ; and Ihtu prerenla 
nooatooy of work fnnii tnvolvinH muautoDj of life g 7. Sprainliud (kill 
•od epocialiMd aia«bin«7 oemparcd .... pp. 310 — SS7 

AMv X loduotrial Organization, continaeil The Oonoen- 
tntioti of Specialised Industriefi la Partieolax LooalitleB. 

I 1. ftioiilinc- funui o( UicaliatJ ImluHtriffl. Evuu b fUrlv Btaga) of 
dtiUjatiaa Ihcro haa bean coDHidcmble Iraillo in Uttlit and valuabl* warea. 

I I TbMT rarions oii^n*. S S. Thtnr advanUgM ; hBroditary ddU ; Ilia 
ffowtlt ot SBbeKliary tcade* ; the use of htgklj BpeoialiatJ waehmery ; a 
kol markri for spteial ikill. g 4. The inSaatiow of imptiivvit maaiu of 
•oauDonMation on the gtegraphual distribntion of indtuirioB. IlliistMdea 
b<Mt Iba reoont butoiT ot BngUitd pp. a2ft— S88 



XX 



cosTKyre. 




Chapter XI. InduBtrla.1 Orga-ntution, contiansd. Prodoetlon ^7> 

a Lftrge Bcale. 8 !■ The tvpico! inJuntric" (or our prcnent pnip^^*' 
MB thtk"' of innniif'iu'tiin?. Thn Booniiray pi timU-rial. ^ 2—4. TK^^*" 
ndvantAg«fl i^f a largn lAi'tf-ry in cho nw of RpMia1ii'.«d mArhinm^, In tf^^* 
tiivtui:ii>ii I'f iuipruitJ mutliiutiy, iu buying uiil sellintt; ia K^ecialii^v^ 
»kili ; nnd in the xnttdivliiioii of thu work of buaintwa managi'mcii '^fc ■ 
AJvAntftg«<s «l the small mannruitnrpr in Iha detall«d warli of anperi^B - 
lundRDcc. Modum devduiimenbi u( kuovrlcKl^o aci in a ijrvsl in«srare OKS 
hi! iii(li>. g 6. Ijaruu ntid unnU trading iMtl«bli«hdiMiU, g & Ths carnr — 
ing tnt-Ipa. Minp« nnil fjnsiricH. g 7. AdmitagM of luigt mA of onaLX 
)iuMiii]09 pp. 331t— 3S^^ 

Chapter TIL ladoatrial Organization, coutinnod. Bosbiosa Man-^ 
agement. i i- Thit pritnilivr liniulicrAtbiRian dealt dirootlj witli ihc 
t'lrHUTiKT; !LDd HO do ■* n ruli! the liiiuiii'd proTcciualll now. | 2. Bnt i 
iii^ti LuDiuutai.'A Lhe »eiT[c«ii of a apeual obaa of uadsrtaker* int 
j^ 3, -1. Tlic chief rJulu of uiiiIvrt&lditK auu)«titni3A aepanled bun 
iltituilifd wurk af iuiin»guiDi.'iit in tlin buitdini; util uomc othar tnidM. 
undrrbikci nlio in niit iiii iiTnpltiyor. j A, Tlic faoulticn rcqurcil in tbs 
ideal inanurttutUKr. i G. Tht sou of a businest man starts witli to lOMtj 
bdnatAgti tluit on« migbl «ijM>i)t bnRin^M mm to farm something lilt* a 
t»t«i natons wl))- this roault docs tiot fbUow, J 7. I'tivaU: partncnhip*. 
jl§H. 9. TtihUo joint Mock cumpaniia. (lavertiiuont umliTtakiiiKii. g 10. 
C(>-op«TatiT« ass/<ciatJon. % 11. Th(> working tnan'n »pparluaitii>ti of risiag. 
He in hiu JctL-d IcBolbaiiatflriitBiKlit appcura, byliia want of oipilal; (or the 
LoAn-Fiind in inorauiag rapiillj'. But the growing otrmplRxity of buaaitcM 
)« HHitinni him. | L2. An ablo biiwin«M man xpuiidtl}* inen'ftiK* the oaiiaUl 
at hill coiiuoaod; uid uue who ii nut abli; Kcuvrally bm» faia capital Ilia 
inprr rapidly, the laiget hi» bnxiacMi i«. The.«e Iwo Coroea tend to adjoat 
cafiilol to Iha abilit.v mmjuIkiI to u«c it woU. BoaincMi ahililj in ooia- 
luaad of capitbl faac a fairly drfliied supply piioa In aoub a Doonti; u 
Kagland pp. S53—STi 

Ohivter Xm. Conclnsion. The law of IncresBliyt In Eelation to 
tlut of Ditniniahlnf Return. S 1. Summarv of tlic iiitet cLAftcm of 
thill Ilouk. FrUrital ami Intrmal eooiivmicH, J 3. An inoreaae ol 
iimnbnn ^''ti'i^Hy IvDdf to a more tbitn proportionate inorcaao of ooUeetin 
cffiHcney. | 3. Thf Late o/ liitrtatitig Ittturn pp. Sni—MO 



{ 



BOOK V. 



THE THEORY OF THE 



BQUILIUKlt'U OF DKiMAXn AND 

SUPPLY. 




Chapter L On MaikfttS. i l- M>mi Monomic pn>bl«n)» bav« a kcrael 
reluliui; to ibn miuilibrium of drmanil and supply, j "t. Ueftnition of a 
3/arkel. f 3. LtmiUtioni of ii maricnt villi TogATd to SptKt, 0«iMral 





XXI 



whiell afliMl Ibc eitent ol tlie nuirluA for > thing; RnitoUB^ 
kt pafiov Uid wmpliiii;: porUbililr. J 4. Hlslilr orekaimia niuk«ts. 
I S. LcmI U*iket4. A maiket wbJoh i««jtiii io b« nairowir confined. 
itBftHiKbjaci lA inilivMi LrUliMnoo* frnm gnal dirtaneos. {0. timlut- 
U«m ■< nuKkct with reward h> rfiM pp-SRS-MB 

Ckipln EL TemponuT Equilibriust of DeoUL&d and Supply, t !• 
loicuual tuuler lL«ra ia i[»n«[&ll.v do une eqailibriunt. t i. In a local 
M(B toarkvL a truD, thoa^ tcmpararj', e^nUibriaai ia ganerallj readied. 
m Hie latent asBDinptioii, tbat th« awrgiiial tttility »t tnouof bo th« 
mmni dnlmi iIoh not api>[«ciabt)' cliange dariiiK the daalini^ Thia in 
llilljf tme In a ooni nuurbit, bnl nnt in a labour markot. Notm on 

hmr pp. ado—ser 

<h|l« in. EQUilihrium of NDrmal Demajiil and Supply. S i- 
Tvif all deaUnsn in commoditin (h»t an; not vor; ])cri«bablc, are affoctcd 
1^ nlcnlatlotiB of tha Aitim. f S. Am! tmd Mlonej/ Co*t o/ pnduet!oi». 
Btfnut* «/ yroditrrtoit. y«eian of prvdntUan. g S. Tht Lav of HtA- 
■iJafiM. t t. The Lava of the Dcmaut] and l^pply Sctwdnlca. fl fi. 
^L f.fitlihri<*m-amimia and ff uiJlMtini.prlM. Aa6V /jufhAWd pp. S88 — lOS 

tbpterlV. EquiiniriiuD of Konnal Demand xnA Stippl^, contlnoad. 
Ibe T«im Normal viUi Beference to Loug and Short Perlodt. 
■ U'i. Klaatiotij of liw t«nn IConnal. An lUuauation. S3. Lon« perlodn 
uil Ann jMTioda. KtodM of thniuiaiKbriam Afnonnalilnmftnd andanpply 
BBf be diTtilcd into Vwa clamca aa Lh« period* tn wfaioli thry n:laui are Iniig. 
n oomparatiTaljr abort, g t. Tha eonlraal in rocwt clmuly mnrked in the 
(aw of taanttfa^lumL ootaiDuditieH. % &. W« mitnl if lixtt aa roprMAOta- 
Hn a liiiiiiiMi «iuel> ia muaffsd with nonnal ability ; and no a* to get its 
bir Am of tb* eeononlM ranittlBK fram iadaatrial orKanlxacion. | (t. 
n« fwaenl Book ia ohiaflj oooOenuil with tnu, or long-ponod aormal 
Mfflj pricM. I 7. Tvo plana for icpKsrntinK the relationa in which 
fUMAtjr jaailng floetuatlaii* atatid to aeenlar ehanffai pp. 406 — IIH 

Gbptcr V. Tlu Tbaoir of Stable Eqaillbrium of Normal Demand 

Ud Supply. SS 1. '■^ 'tTi" oonitr-jcli.ia of thn ivipply uchedulc. .*«- 
■ n wip t mif of tbc pure theory. S S. MiiIii)iIb pouitons of ti]uilibriiiia. 
1 1. CantiDO* r«i(Difvd in ajiplyiim tltv tbvury. | 3. The ixwaeaiioti uf 
•Kj rw nalural advantagM afford* a Pfodutfr*' Surpltu ta Sent 

]i\i. 410—120 

YL Joint and Composite Dtmiind: Joint and Compodto 

[.0S[9ly. 9 1- ItftiMd drwumt aod^Ni lUnan^, Uluitration UXtu fiinii 

\ I«bo4ir diopiitA in the bniUing tnulc Monenl La* of Derived Komaud. 

1 1. ConitttioiM Quder which a cheek Io anpplr may raiae much the piieo 

I a betor at prochMitien. | K. Compmiu deutantl. Tha dintribution of an 

I good balWMB aaveral luaa. g 4. Jfiiitt Supply. Darlved mpi>\j 

I &, Compmite Supplif. BlnU oommoditiea cannot RB(i«rallf 

PMala in Uw fi*ld utvtthm, U any of Ibein obej- iIm> Iaw of IncraaaJnit 

Batam. f 9. Comples problcnu ..... pp. 130— UO 




xxu 



OOKTEJfTS. 



Olupteir Vn. Theory of COiaiiges in Nonnal Dom&nd and STipplf, 
with some of its ^**ftri'iiit on the Doctrlae of Maximum Satlafac- 
tlOIL S 1- latroduoliaa. f t. IHfltcU of ui iiiori^uu or normit d«mkiiiL 
%6. Effeotaof AD incrcaao of nomiA] supply. ^4. TheoMMof Conitu^ | 
Diit)iniitbin|{ luid lucrciiftutj; Itolnrn. if 5, S. Statement and limine 
of thci dnetrino of Uarimnin Satiaftetion .... pp. 411^354 

Chapter Vm. The Theory of Monopolies. 1 1. W* mn now to ( 

titv tnonopoliiit'N gaiat Srom k high price with Vtui beavHu %o Iht pdUio tt 
a loir pri(^e. f 3. The pnmdjaeit inlerMt of tho tnonopolMt is lo gat liw 
n»shnum Stt Rev^tuu, | 8. Tba ilonopoiy Jirrtntu Scfw>li^f. J I. i 
tftz, fixed in total AiDoauC, on & mooopoiy, will not diminisb pcodaotioni 
Bor win cne proponioitid to Monopoly N«t Bevsoae, bnt it will luva tlul 
offL-et if it ui proportiuucd to thu laaiiLitf prodowd. {5. A uuMiopoIut 
can often work ccoaoiuiciili)'. S l>. He maj lij«%r Mh price with & ri«it to 
the future davdopmcnt of hU bnaioess, or from a difMt int«rMt is tlia. 
wiilfu* of OOiMtiinert. j 7. rulat Den^t. Con^/rvnitt Bert^t. Q 9, 
•ttLtintical study of the Imw ot Dem&nd and at CoDaumcn' Bent 

K..«e-4T1 



Chapter IX. Stunmaiy of the 
Qenund and Supply . 



General Theory of EiiaiUbtitun of 

pp. ^7s~*7a.J 



BOOK VI. 



COST OF PRODUCTION FURTHER C0N310KKED. 



Chapter L Introductory pp. mi- 

Ohapter U. Cost of PEodvctlon, Limited Soorcea of Supply. 
1. Frovi«ioiiat KlAtcrneut uC Kicardu'v doctrine Umt Bent dew* not 
into oaKl nf pniduBtiou. f 3. Il inrulvce a IntL'nt a»;utaptiuD. wblob i 
tnirly bt' tnudu will) raRud to AAiieultar^.! proditae laa a wliule. J t, 
when thii dociriiic \» applied to any out) kind of prudaou talcun Mptrately, { 
is mialeadin^ S o. Thou litnitationiiiuidoonilition* wtiicli &n UMXaMiyl 
nuike the douliiue true uf Kgricultuml rent* hid HUfliuivut to tiuJ(« It trnt of 
urban n>nl». The Mvftiti of Building. Thu indinwt elliM of rent ou cncl 
ot production must not b<i ovwluukad githmr in niwaufiuinie or is agricDl- 
luTc. I H, Miniuu Bojrkttiw aat«r into tfa* eost of prodnotion of mlawkla 

pp. 4a»— 491 

Chapter m. Cost of Production. Limited Sources of Supply, con- 
tintied. i l- "^'^^ question n-bcther ths income ilcrivcd fiotn ft (aet«r of 
produotion is to bo rcgnntcd u partakinx ol the Dataro of rent, d«p«Ddj 
ahitdy OD the lauglh of the period tea whiab ill induenos on produotioii ia 
being wtimatod. H ^-^^ ^'hcn docw oov&try i> fiixt iH.-ttl«d, Uad ia to bt 



OOHTKITTS. 



XZIU 



im^ti M yieidiag profiU ntlur thuii nnt. It«nt emcifee tutcr. $ 4. 

BHkee ol fcrai at luut tcBimt. { S. Tho QuMi-ivnt of mochiQcO' Md 
(Am iaplamsnU. Tbo uulogy bvtwMn QtUMi-rcnt And rmi relates only 
Uihoit perioda, and Ina oo bming cm Uiq broodai' problema al economic 
imgnw. I 7. SuniDuuy or the rdatiorn betweoa r«nt uid Quasl.t«nc. 
CoaMDMB of tbe conoectibti b«twooii the suppi; price of a cammoditjr and 
Id Bnl Com ot protloction. The true algniHouiM uf n podtion al nomiKl 
tqniUbrinm TP- <93— 50* 

dkiftur IT. Tbe Cost of Prodttetioa. Iho IndnstriiCl EnTironmeat. 

1 1. Ififlueocc uf iiittuilian on ihc vottii? cif atn'iciilmrftl loud. Iq ull traiitw 
UMM io Est«nul eotmoinie* depends putlj* on atiutliOR. J 2. Sitaatiott 
mf. I 9. Bx««pCiQii*l cMMt in wlti«b tbe ijiooiao d«hvcd from odvuti- 
tagacu dtuatkn ia to be raEardod as proAie miba tbau rent, sg 4. 6. 
BitsnloB mrt Unda gfnenlly to riau . . . . yy. 505 — 512 

Ckiptw T. Cost of Prodnetlon. Tho InTestmest of Capital la a 
ButSMIk t !• Uotirea deUrrratnintt ihc iitri:flliiii!iit cjf uitpiul in the 
an e( * nut vlio nukn k thing fur tii« ou'u umu, $ i. IhvimuuouI of 
wpilfti by tb* iDodara Ctid«rtal[cr> «ltcurauIci(f«R ot pa-^i and liMcirHnlinjr of 
(Wsn ovtlaTS uid reeelpta. DUEcult^ uf diitinguiftbiUK liuinreeu iiipeoditnie 
m Borrrat and on upitai lueoonl. | S. Tho mmrgin of prcflUbUmviti in 
Ml » point on ftnjrooo roato, hul ftliiie iDterMcting all routes p^. G13 — 6IS 

(Su«(« VL Oort of Prodaction. Prime Ooet acdTotaJ Cost. Ooat 
of Marketiii^. iDBOiauce agmlngt Risk. Cost of Reprodnctioii. 
^ 1. i'timt CMt. SuppUmrnlary and total cott. Wbciu tiivm U mach 
tati npllat. prioM out fall dor below tlicir nonual levol wiUiout rcMhinit 
PiAm oM. H fi, S, Dif&enltiM rslAtinij to tfas eoxts of joint piodOBU, 
H mtiffuag l« «Kb bnuwh of » laiMd buiincH ite proper *li«« 
of Iba ooat of marketing, g 4. InaurvMM aeaioit loai hj in or sea. 
Otbar barinaaa riaka. | 5. Unoertajnty ic an evil in itself. | S. Coat of 
njcodiutioa. Hora on Bicardo'a Tb«0T7 ot C««t of Prtxloction in relation 
,»Tilae pp. Sia— ASS 



BOOK VII. 



VALUE, oa UISTRIBL'TION AXD EXCHANGE. 



QtpUr I, PreUminary Surrey of Dtetribatio& and Exehasse. i$ i. 

1 & podtinn ot nivmal txinilihrium in dhv Mirards vbioU eOuHomio foraaa 
■n Mmritpff bat it ia not aaltuilly roaliivd. In tbi* jiruliniinar; iiurvay we 
M(laet ilatarUng easaea, and auppoae an aJniMl Suiionar; Stat*. We do 
Ddl awutBa perieot knowledea and frutsloni of ooinpetilion, but oalj tho 
■MrpriM and h uinati habits whioh ar« noriRal to meh aov«nl rank of 
Maataj. Wa take ai«n aa tbej- ar«, gitrvmtA by auui; niotivoa and ■»■ 



IXIV 



CONTENTS. 



jailm* : bnt Ihe tendane^ (or Mch ons lo ndopt that ooune vhleh be thinlis 
mMtftdvftntag»onitwill««tconBtAntly in>)n«diMetutn, ftndin tluftlMKD(>e of 
dlalarlxuioea wQl ^nuliiullj prei-ail. 8 3. I>eiuuid tot labour. The ftomtDvn 
•myiny thai in bminiHi pvnr^iliiciR find« Un oyra Itird, impliw tbe L««r of 
Subotiliilion. $ -1. Etplioit kpplicftlioni of Lhin law to UiiUibution vi*i* 
fiml inuiti- by vim Tbiincn; his katicipAlKMia ol modem dootiiack. S B, 
Tbe stattfiumt that 'a&g«H lend le eqaal the JVM pmAtri of th« «ovk< 
Iftboor, ii unJuI for ■ome pDtponcs pp. 

Chapter II. Prelimmaxr Survey of Cisthbatioa and ExchAogf^l 

continued, i l. TIji^ ?hvHiocrau B6»uiD<-d. in aocutilaaco wiili tbc pcca- 
liui Qiroiuaat&uoen of thoir time and country, that v«^«n nere at thfir 
lowMt pouibk level, Mtd tlint much tli« naine woe tra» of Uio iiit«H«l tsa 
CApilal. Theie riKid asuuniptiont were purliull.v relairtd by AiUin Hmllh, 
uid by Multhua. Bicanlo's l&uguagi* vtjt loone; but lie did not hold (haj 
"u»u law gr wbbdb" oomniouly Oittributeil tv him. Xbc det«rionliBR 
(rdeoi of loK wage* bai b«cii insistLiI ou tiy Mill, and morw fully by Uenenl 
Walker nnd otlinr Amnricnn economists. ^ 9, i. ProgrwjsiTc iaodi£»- 
tioos of die asfiuuiitious uf Ibe Pbysiocralt. Tliv amounls and prico 
of tbe neveral a^eulH of pruduction miittinUy d(>tenninc onv anattaor. mbjM 
to thi< j^nnral ceonomic eonditioDit n( tim^ nnd plsw . pp. UO— SM 

Ohapter m. PrelimlnaTy Survey or Distribntioa and Ezdunga, 
continued. % I- But vtMIp T^nrniaeT nnd Tntorcit arr amonK tbc cli^ 
menu tbut mnlnally dotermine one auothn. itent ie not: it is dpUinnintd 
by tlH> othciD. I 3. Tho imRrt««(D Kol product of the ORont* of piodaotim 
is [ho .ViitEoruiJ bividnid. Sonat In whloli It in Irno ihut tho caiuingi ol 
labour dt^pend nn advanoei made by (injsital. Tim National UJvidand i>at| 
onoc tbe product of, aud ths couroe of demand for, tJI tb« ageiat« of 
ductioB. S S. &n ludvoae in the napply of aoy iuc<!nt will generaUy lo 
itx prioo to the btmtifit of olbcr agonta. J 4. Wage* of a worker i 
prio'uionallj in t«niiii of tha Net piodiiRt* of worker* in tiio samv gnd« I 
of otbor grniet. Tho dependenoe of waitcs on the cBideaoj of laboon,^ 
An iocnattd supply of buHliicau ability raiEiu tlu! wagim of niuniial laboiUjg 
A-dJ ko do<^B All incroa«« of capital ultimFitoly, ^ £■ But it* iuliDV 
t/Beci may be Oifleretit. NirrK un the Watccx-Fuiid Theory, aiid on two i 
Mill'* Fmidaoiontal Propositions on Capital pp. Ut 

Obspter IV. Demand and Supply in rclAtlon to Labour. Real 

Hotnloal Eaminss. i I. Comju'titian trmir. lu luakv ni.vUy HMKCx I 
nimilar ■•mp1o3'nii?nlB uot e^ua). hot projiortiuLite to the efflcieucy of 
workon. Tiru-f^mintj; faymcnt by Pirmpari, Kjfiti<-nc;/-*itntiii 
Time-Mralniis do not U'lid to oiiualliy but vfCcicucy-oaminija do. (9 i. 
Real ieaji^» ruid Suminal trmu: .Ubiwaricu niiicl )m> tnado far variatb 
in thf purehaiini:^ ponyir of money, nitli npiiriinl refiirnnaA Ia ihn connnnii 
tion of iho itrade of Ubour cuucu'n■^l3 : uud for trade cxpennca aud all ine 
dealal advaiilimeii oud diMuliantasM. % 4. Woffea partly pnid in kin 
S. Tha Tmek *]ntt«in. g G. UnoMlaiaty of nicoeM and irrcRalariiy i 



* 



CONTEXTS. 



zxr 



mghfmnL f 7. 8i|p|>leinsnhU7 «»autig«. Familj Mrnint;'- I ^^ 
Tki lUmO M T Ut m u of n tnd* doai not ikpeod in«nly on ibt moDey- 
■Biap, bat Ua !i«t Advantagai. Inflttanee af uidHda*! and national 
«lir»«o Mi.«7a— 686 

CUpttr 7. Demuid and Supply in reUtion to Labour, costlnned. 

I ^ L Tbc importABcv or inkiiy pvcoliafilieH iu Cbv naliou of dcnund uid 

lB|i|iJjr vith ngard to Uhour dniKudx imtcli oh Uig oumulfttii^nrM of ihcir 

Atto:Uiiunaniiblingliwiinflnmci> nf curtnm. ^3—4. Finl iieoalinrit]': 

ba WD«k«r mU* hi* trtsrV, but !>» liiunxK hofi no pries, CoiiMqacntlj' the 

unAnonl of CApital in him in lintil«<1 hy tkr imuLiM, the fnra-thonRhl. ani 

0* mMUIsliiiem of hia paranU. tm ports iio« of a Htnrt in life. InfluGaoa 

4(nonl tonw, {G. Scvond fwc'uliaritj. The nrorkvr int*^TuhI« firim hia 

nrk. t & Third and fonrlh pcQiilinritiw. Labour » porixlinblr, and the 

rtim of h are often at a diwlTfuils«i> in haTRnininil pp- at(i^59S 

OkpUr TI. Demud and Supply in relAti»u to Labour, continuod. 
I L Tlw fifth pemliKTilj of labour coQBisU in tho siemt leaglh of tiTnii 
mfiiiKd Utt ptovidinit additional eupplJM of specialized tibilitjr. ) 3. 
hmib in obooiioK tr»dc« for tbcir childrvii maxt look foiwiiid a whole 

»|(iwnlIon: dtSQcoUics of ToiccaatiDK the (utUTe. $ S. Movemenla of 
idnlt Uhour aie of inpr«asin(E ItoporlaiiCf) in ooDBO(|Denoe of the growing 
lnBa«A for genaal ability. | i. lUaain^- of the diottDCCloD biatwMii 
laog and ehort panodn with raAiPHiM to norroal valna. { 5. Tho Qnasi- 
taU Oif labour Is aeen mort cUoiI^ in lUc case of iudcpendoiit buiili- 
aa4W-BWii i hot it caiO alw be t>aM>d trnder tliu mod-um tjstcni of iiidusti^. 
■ 6,7. lD«*timatiiig the Qoa^-ivnt of the labouri-i's skill, a«ci)unl must 
baiatet not only of his wmt and teAr, bul alia of hi* falijiup. £ i^ Thq 
tUn uiooiD« variMd by natural abiliUw Dwy b« r«^t-ded u m reul, when 
M art oonaideiini; the aonrera «f th« inoomM of indiTldiuls. hut not with 
wlHMMiii to the Honaal aatninffi of a twde ... pp. fiS9— 610 

Ckptv Vn. Dcnund and Sopplr in r«laUou to Capital ^ i. 9. 
U man clivuHis u the revaid of hi* latioor deferred ldjojiiii'jiU Initead 
tl iMtttiliatA, it is gVDwally bMotioc ho esp«ets them to *hon a saqilaa 
ta ^ long nm. Conditiona aodcr wliioh thin furpln* can bo meuured 
I7 tho t«t« of tnicnst. 9 3. 4. AccumiilaMd wealth in the result of 
bboar and waltiiig. Th« anrplBi oRerod by deferred <«ioyni«nta it tho 
naolt of Kuiiiiij;. g S. In t»tly atagcs of civilization the atiuae* of loans 
M toUxnl may «xtted their tues: and thin fiKl rrtacded the growth of 
limr notMns a* to the nitimu of wurvicwt routlvrtHl by i-a|iital. Connsotion 
bitwaa llu pnctMol proposnls of Karl Mwrx and his doctrine of v«lae. 
I ft. Tbc groM intcical paid by tho bonowvr indDdea soma laitanuKe 
(fsiaM rtUi and Earuings of Uaaa^uitint. sud iher«tera rerles with the 
liKcinataiiMb of saeb loan. J 7. Trade JtUk* mti Ptrtoruil RMi. OrvM 
tslanatdots imm (eud to equallt}'; hot tl><r sKeni^es of tho iiic>d4'm money 
mattarl Uai to cqttaUxfl mpidly the ihim of Xn iot«n»t ou difltmat dson 
vt capiUi. fl 9. The ral« of int«ra>t as dEiormincd in tho lonf ran by 
tb Eoioss of supply and demand, i 0. Strictly mpeajung we can meaaoie 



XXVI ^^^^" COKTESTB. 

Uio iaU of intUMt only on nan- invAstmanU: bc«a,iu« Iho rtdne of old 
tnnBtmenn b detenniiinl b.T cstimntiiii; thcii probable htian Qiuud-ient** 
HJid ckpiUiliiiiaH (hem. Kute oo the ptirohiutini! pomr of mfirnqr in 
rdktioa U> tlie rMl rnte nt int«r««t p)>. 611 — 636 

Cliapter VIII. Demand and Supply in relation to Capital, BusincM 
Power and Indostrial Organisation. § i- The on«.iu(i«a action »f 
the Law of SabstitutioD. Tlio ultimate aad iadiieot Mr^icoa rendsni 
by &ny form of bmioeu m&uagenaent play very lilUe put tn d«termliiiiv 
iU noecM b the Straggle for 6iu-nvftl. ff 9, 8, *. Tlui acticm el tb» 
Law of SubBtitiition in oontrolliDe BaminicB of m&DotieiDL'nt, lUtutnled 
by oomp&riiui flitstl; the services of foramen vith tbose of ordinu; iroik- 
Clint), scconclly theme of heads of bnaincMeB iritk thoM of foromco, iM 
bvBtl; those Undertaken on a Wkc and an a email fcolc. $ 5, Tht 
rRWuniii of tloilertakorg who pionsfir vew mi>thodA of buHia»M mUdu) 
ooniRipnaurAto with ihidr ronl vnluc to iioeicty. g 6. Pontion of Iht 
iindertnkLT who ueea macb borrowod capital, $ 7. Joiat-stodi compaaw: 
lh«ir mnmuiiinvtit ik in the handB of ofUcials nlio own bal little oapluL 
'Ibeir silvtintagM And diiiAdvantAgfiii. g S. Uodtirn mathod* of bosiSMi 
Ustid to adjiiHl Rornint.-!! of Miuitu:euent to the difBcult; ot the work ikme. 
Sft and Otof* Earning* of AUiuLg«meul. S 9. Bonintiu abililj » Bon* 
.peciiJiKod pp. 699— M5 

Cliapter IX Demand and Supply in reUUcn to Capital and 
Busineas Power continuod. S 1- ^e have nuxt to imiuitu wbether 
thnro i» djy gcnetat tendenay of the rate of ptofita to wjimlily. In a 
latRc bunoMtt «otn« EanungB of ManagemeDt ate cloMcd m» alarifli; 
and in a vmall one much wagea of labour ib clasRed oa prnftts; and in 
OtHuaqnmce profits nppoar hi^hnr in nmall bueineews than Chey raallj 
oM, f 2. The nonnft] annual rat« of proGlt on the oapilal «mpt»y«d 
ill hiiih trhrrr the Circulnling capitnl in InrRo relatively to tho Fixed; and 
espMinlly where the wsRocbiU ik very lar^ relatively to the oapilaL 
^ 3, 4 Raeh bntnch of trade h&* H» ouRtoinary or fair tata of profit on 
tbo ttirnovvi. i 0. Profitn arc a ixumtitiient rlnmcnt of normal snpply* 
prioe ; but tbH inuniiie ilorived from cn[iitul ulnmily invutwl, in a motariaJ 
farm or in tho acqtiiiition of ulull, ii (jcncriUly n (Jaaai-twit. j 6. Inoom* 
derivod from tbc Immalenal capital invested in a buainee(> H 7, %. In- 
diTidoal proflta difler widely. Their H-vf^rage t-aJua i* ow^Mtimatcd be> 
oauM thoM who Iom all thnr capital diiut|ipear from »ght. J 9. Othu 
difereocoB b«t«ceD proCtB aad vuntnga § 10. Thu Moollcd rent of 
rare naliual abUItien Is more promlnenl in buvintsu ptnOt* Ibon in many, 
though not all, prnfeudanal fiantingn .... pp. C16 — G6S 

Oltapter X. Demand and Supply in relation to Laal. iSiUi- Th« 
r«ot of land i> a ap^cioB of a large gaant. For thu ptcM'nt wc vappoM 
land to bo eultJTaced by Its ownen. IMnim6 of earlier dbca.iNions. g ». 
A TIM in tho nia] vnlun uf produon {tencmlty rniHim the prodnoa laluo of 
Um awplua, and ita real valuv enn more. Di«tinotton IiHwmb the i 




XXTU 

itbt, tad Um gvnani pniehMliij power of prodtin. i 1. ESoota of 
h/wiwuuiit* OD Prodnoor's Surpliu. g .S. liicArdo'* AmMxm oS Bent 
•rCtalaear'* Snrpliu i« gvDcr&Uy appUcabl* w aevlf all vaUj&a of land 
Bbi in tii« modern EnKlish sytiwin tlis broad Una of (UvUion 
. tb* luidlord'a 9a& th* faniier'a ihikri! in aluo that which in tn<Mt 
iBfortut Aw >cleac«. NotB on Hic«nlo'fi doctrine as to tlic iacid«:nae 
tf Hum wid tbe infltunoe of UoiitoTenieDU in A^ricQltiira pp. fi6%--076 



Ckpter ZI. Demand and Supply in relation to Land, costtaned. 

ItSd Toniure. S I- Karly fomi* of Lond-t^narc luvo gtvsTRlljr benn 

tucd on partaenhlpi, tbe Irrnw of which aro doccnniniid bj tndition, 

atbir thftit bj' Mtiidoiu contrael; the nxMlled landlord U gunentUj- tfaa 

ilnifinn pkrtacr. The ccoooaiio t«nt or Sorpliu belong* to tbo finn; and 

Ai [uidlOTd'i sbara it detenninod cbicfl; bj oa»ton). {{ 2, 9. But ooBlom 

li ntHli nton plMtie Qmh «t flnt appeam, a« h ahonn eveii by Meoot 

SbfliA hidCKj. Caatioo u a*«ded «ben ftpplyiug Biconlian aoalj'su 

■onodeni En(U*hUDdprobleBU;M woU uio mrllox8j^t«ou. The temu 

It partiumblp in ttum wen ngoo, «la«lo. and cupabU of nnoanrtdosi 

w wLfi fti on in tamjaj wajw. fl i, S. The kdvants^M and diaadvuiUeu 

«f Mvtaratt* aBit Peaauit-Praprielorabip. gg 6. 7. The EnHlinii q-KlMn 

oablM lb« landlord to loppiy tbat part o( the eapiui for whicb ha oaa 

It MiOjr and Bffootirdjr tgvponaiblsi anil it givw oontidonble tnoiam 

Id tlM (broM of wicctioii. tiiouKb laiii than th«rc U in other broncbiM tA 

ladBNrjr. DUUcqIIj of deoiding what arc nornval prioiH uid lurreati. 

8. Oiflkalt; aiiiiiig bon local wiatioQg in ths atandurd ot normal 

•Ull and flntApriee; etbioal and ecouuiuio «leni«iito clOHdj- in- 

glad- % 0- Tb« tMuuit'a frcedoni to tnaka anJ rmp tha fruita of 

nta. § 10. Hm) intcreota of landlordK and of the public ad 

Nsanla lunall faoliiinitii do not ondrely ooiDcidc. g 11. ConJUat between 

paUio and pnTAi« inMnile a« regard* huiUing on opoo <pa«c», and 

b otfaar nMttcn. | It. The capital nine of land . pp. ti77 — C97 

Chftrt«r xn. Ooneral View of the Theory of Value. $i 1—7- 6am- 
narj of ibe chief tbeorelical rtaulta of the prveadinii dinptart. J 6. ^le 
niaboKe bstvean the Qoasi-ivnts of the Malarial and Paisonal o^tol 
to Ha tad in the btwinces and Uw i^wial okUl and laiowledi!<i of ita 
BBplnj«>a pp. d98— III 




flhqtarZHI. TbelnflaemceofPrivTeu on Value. n> Theridmeas 

it lh« ttiA ed onplayroenl fur eapiUl and labonr in a now 001111(17 
i«fNoda partlj 00 Um tattm to marketa in wlucb il eao aell ita soodfl 
and Btortga^' iU fntnie income* for praiMnit nuppliea of what tt vanta. 
1 1, 1. Bn^loBd'a fbrnga trada in hut e«>nturj tnemaaad hu Mtonund 
W*tr twnfMia and iuxuriea, and onlj «ilhia reeeab jwn baa much ia- 
«««ad bar eammand orar naoaaaanaa. g 4. Her direct Rain* from the 
fgn UJi^ of mamliMlafM hive been teat Ihan at fir*t eight appcarn ; hot 
turn tnm tka naw meana of tiantport baT« baea ifrfatcr. S ^- Changes 
lalain Talma of mm, total, bouae-ioom, did. dothinii. waiar. 




XXVlll CONTENTS. 

light, nens, &nd travel. § G. Progress has raised the labonr-Talne of 
English land, urban aud rural, taken together. % 7. The increase ia 
capital has lowered its proportionate bat not its total income. 59 ^< ^■ 
Nature and causes of changes in the eamioga of different industrial claaaes. 
§ 10. The earnings of exceptional ability, § 11. Progress has done more 
thau is generally thought to raise the wages of labour, but very great evils 
remain. § 12. Progress in relation to leisure. A general reduction in the 
hours of labour will lower wages, unless a new eoonomj is introduced bj 
working in shifts. % 13. FallacieB that it would cause a permanent ia- 
orease in the demand for labour; and petmanentl? diminish the in*on- 
stano; of employment. 3 14. Fallacy of supposing that because one trade 
may gain by making its labonr scaroe therefore all trades can do so 

pp. 712— 7S6 

Mathematical Appendix pp. 787— 7S0 

Index pp. 751-75* 



COEBIGENDA. 

P. 1, 1, 4, for a read aiiif 

P. IT, 1. last but three, for Pelt^otmemii read HtUa» Pmiier 

P. 6(1, reference at end of footnote should be to nolr at end of Bk. VI. 

P. 89, the explanation of the phrase "the aclion of a law," given in the first 

footnote on p. 545 should have been inserted here 
P. 101. 1. 19, for plan read plaet 
P. 103, footnote 1. % for trader read producer 
P. 139, 1. 1, for lolai read gross 
P. 147, 1. 8, for sixth read seventh 
P. 178, footnote, the last paragraph of Note vi. in the Appendix should have been 

iiiserted here 
P. 435, 1. 7, before sMitfactioit insert inteimty of the 
P. 490, footnote, last line but five, after margin of add eiiAi'f a(io» or 
P. 664, footnote, for tcss read gain 
P. 605, 1. 12, for determined read derived 



BOOK T. 



PUELIMINAUY SURVEY. 



CHAPl'ER I. 



ISTRODIICTIOS. 



S I. PoumcAL EOONOMT, Or EcXJNOMICS, ig a studj of 
11 wticais in the'ordioaiy busiiiess of Ufo; it inquires 
hm gets his income aud hovr he u.s(>» it. TIiils it is on 
4nc side a study of wealth and uii thi- uther, it more im- 
side, a part of Jhe study of inaii. For iiiai]'>i character 
been mouUlwJby hi» every-<lay work, arid by the material 
which he Lliureby procuri-*s, inort than by any «ither 
■ifliieim utdoas it be that of bis religious ideals. In fact tbe 
tUDgNBl Ibntuitg agencies of Uie world'tt hi«t(irj' have been 
Atffligtous and the ecotmmic. Here and there the aj^ourof 
1^ military or the orUBUe spirit lias bccD for u while pre- 
4aaiiiatit: but religions aiid eamoinic inSuences have no- 
tboc bcx'U dittplaced from the frunb rank oven for a time; 
Od they have nearly aln'av'M been more important than all 
fAm jnit li>gether. Religious niotLvea ore more iotcuse 
AuocDDomic; but their direct action »3ldom extendi over so 
^uge A put of life. For the businesA by which a person 
ctnis his livelihood generally fills bi^ thoughts during by far 
tbr gnutcr part of those honrs in which his laind is at its 
tM; diifing tliem liis character is being Ibmicd by the 
mf in which be nses his faculties in bis work, by the 
tltoi^ts and the feelings which it suggestti, and by his 
X. 1 



IIUI>K 1. 
OB. I. 

Ecanamirs 

(if wraltli 
Mill nn the 

Utilft 1 

liimii'll of 
till- -tmlj 

of IIIMll. 

Tlie 

liiilorycif 
lb« ixalA 
lifla in Ilia 
m&iBb««n 
■bapelliy 
nUsIona 
Koa 

loievt. 



Uau's 

ctuir*eter 

work. 



INTRODUCTION. 



BOOB I. relations to bis associates in work, his employers or his 



CH. I. 



C&QMB 



employ^. 



Poverty And very often the influence exerted on a person's 



degn- character by the amount of his income is hardly less, if it 
'**"■ is less, than that exerted by the way in which it is earned. 
It makes indeed little real difference to the life of a family 
whether its yearly income is £1000 or X5000. But it makes 
a vety great difference whether the income is £30 or £150: 
with £150 the family has, with £30 it has not, the material 
conditions of a complete life. It is true that in religion, in 
the &mily affections and in friendship, even the poor may 
find scope for many of those faculties which are the source 
of the highest happiness. But the conditions which surround 
extreme poverty, especially in densely crowded places, tend 
to deaden the higher fiaculties. Those who have been called 
the " residuum" of our large towns have little opportunity for 
friendship ; they know nothing of the decencies and the 
quiet, and veiy little even of the unity of family life ; and 
religion seldom reaches them. No doubt their physical, 
mental, and moral ill-health is partly due to other causes 
than poverty, but this is the chief cause. 

And in addition to the residuum there are vast numbers 
of people both in town and country who are brought up with 
insufficient food, clothing, and house-room, whose education 
is broken off early in order that they may go to work for 
wages, who thenceforth are engaged during long hours in 
exhausting toil with imperfectly nourished bodies, and have 
therefore no chance of developing their higher mental fiicultiea. 
Their life is not necessarily unhealthy, or unhappy. Rejoicing 
in their affections towards God and man, and perhaj^ even 
possessing some natural refinement of feeling, they may lead 
lives that are far less incomplete than those of many who 
have more material wealth. But for all that their poverty is 
a great and almost unmixed evil to them. Even when they 
are well their weariness often amounts to pain, while their 
pleasures are few ; and when sickness comes, the suffering 
caused by poverty increases tenfold. And though a contented 
spirit may go far towards reconciling them to these evils, 
there are others to which it ought not to reconcile them. 



BOOK t, 

cn. I- 



Ttie world 

KTomi tliu 
tMel tllBt 

will it not 

tbuli^irf 

tlut 

povortyiit 



IBS ITRCESCT OP THE PttOBLBM OF POVERTT. 

Orfniiirked aad undprtaiight, woary and tMjfwoni, without 
fuiel and without leisure, they have no chance of making 
ike bcK of ihetir tii«ulal fk-ultit-^i. 

Altliough (hen some of the enls which comtiiouly git with 
jnfwty are uoL iw nece&Harj' cons«<jut?nces; yei, broadly 
iprnking. -the destmctign of the poor is their poverty": luid 
tb( Uddy of the catueH of poverty is the srudy of the causes 
'1^ die d«gndaliou of a large part uf m&Dkind. 

52 SlaTeiy- was regarded by Aristotle as an oniinance 
doatorv. aud so probably was it by the slavex thttinselria in 
■Ued Hine. T}io dignity of man wiu proclaimed by the 
QiMtu n^li^oii : it hits been as^rted with increasing vehe- 
■com during thf last hundred years: but it in only ihroiigh 
lb tptvnd ijf ■.■ducatiiin during ()uite recent times that we are 
klbiuag nt last to foul Lbu full itnpurt of thu phra.-io, Xow 
Jibatwe are setting ourwives seriously to inquire whether 
it ii DenisaiT that there should Im? any so calli^l " luwer 
dMies" at all: that is whether there need be large numbew 
rf fwpic doomed from their birth to huni work io order to 
pwulu for others the requisites of a refiuefl and cultured 
liJ.", whilp ihey themselves arc prevented by their poverty 
w>l toil lirom having any share or part in that life. 

The hope that poverty and ignorance may gradually bo / 
otii^oithed derives indeed much support from the steody ( 
popus of the working cl««9*e during the present century. ' 
tbritcan engine hoA relieved them of much exhausting and 
&|lK&]g toil ; wAg<« have risen ; edueatioa has been im- 
fKni and bectmie mitre general; the railway and the 
fBa6ng press hare enabled members of the uaine trade in 
■BCitKiit parts of the eountry to eommuuicate eaitily with 
'<k( iuolh«r. and to undertake and carry out broad and far- 
*tiiig lines of pulicy : while the gruwiiig demand lor inlul- 
%iit u-vtrk has caused the artisnu clasKes to increase so 
iv that they now outnumber tho^e whose labour is 
y muJiilleil A gmat part of the artiitaiiM have cuuted 
^ lekmg Co the "k>wer classes" in the sense in which / 
^ tena was <jrtginally used : and some of theui already 
Ittd a UMinj rvtioed and noble life than did the majurity vf 
t^ Bjiper cLasse* even a century ago. 



4 INTBODUCnON. 

Booz I. This progress has done more than anything else to ^ve 

^'^' '' practical interest to the question whether it is really impos- 
sible that all should start in the world with a fair chance of 
leading a cultured life, free from the pains of poverty and 
the stagnating influences of excessive mechanical toil; Mid 
this question is being pressed to the front by the growing 
earnestness of the age. 
Thia The question cannot be fully answered by economic 

gifeB^ite science; for the answer depends partly on the moral and 
higheat political capabilities of human nature ; and on these mattera 
economic the economist has no special means of information ; he must 
do as others do, and guess as best he can. But the answer 
depends in a great measure upon facts and inferences, which 
are within the province of economics ; and this it is which 
gives to economic studies their chief and their highest 
interest. 
Bnt first § 3. But before considering in detail the purpose and 

Sqa^' scope of economic science it is advisable to trace the chief 
i""'!* steps by which it has arrived at its present position. Some 
economic explanation is required, at starting, of the paradox that a 
m the mHtn science which deals with such vital questions is still in its 
^^i^^°* infancy. This is partly because the bearing of economics on 
the higher well being of man has been overlooked; and a 
science which has wealth for its subject matter, is repugnant 
at first sight to the studious mind. Those who do most to 
advance the boundaries of knowledge, seldom care much 
about the possession of wealth for its own sake : and it is not 
unnatural that their just contempt for wealth as an end of 
life should extend itself to the study of wealth, and cause 
them generally to neglect it. But the chief jtaxt of the 
explanation is to be found in the fact that most of the 
phenomena with which modem economic science is con- 
cerned, are themselves in their infancy. 
This will The ordinary business of life is entirely different in form 

to 1^"" (roui what it was even a little while ago. It may be true 
ciituw^ **■ that the change in substance is not so great as the chaage 
n"*ny in outward form ; and it will be argued later on that much 
^nomena more of modem economic theory than at first appears can 
ittanow ^ adapted to the conditions of backward races. But unity 



BG0N0KIC3 IS A MODEHN SCIEXCE. j 

mbstanco nnderijring man}' varieties of fonu w nut cmy uuos i. 
to detect; and the changes in form have had the effect of *-"• '• 
■Mkiug writera iu all ages ijro6t leas thau tbey othervrise cMiwninJ 
ought have dooe bj the work of their predecessors. Modern at rnrent 
nuwinic phtnomeuu however, though very couijjIcx, are "' 
in iBAuy mays more <lefinite Ihau lhf«se- of earlier times. 
Bmiuji; 'lA tnoTv: dt^orlv marked off Iroui other coucenm 
tl tife. the rights of i»dividuaU oh against others nnd 
u gainst thu ainiiuunity an) more sharply <leJiQod, and 
ikxre all Ibe eruaacipatioQ from custom, and the growth of 
bt tcUvitj, of coiuttaiit forethought and restless enterprbe 
Ire given a new precision and a new proiniuencc to the 
■OH that determine value. The starting puint of otir 
Mience therefore cannot be made elenr without a. brief 
•ccoiiDt of the growth of modern fumiH of buaint^tis; and to 
tht we proceed next. Wc are however in difficulty for 
vm of a word to expre») properly the jipecial chamctor of 
bnsinesft. 
Ill It is oflon said that the mudem forms of business ThtfumU- 
iod from the earlier by being more oompotitivc a^»pier. 
i^ account is not <niite sati«fiictorj-. The strict !*"«»"- ^^^ 
of «impetitio» seema to be the racing of ono p«iraont««Bewii; 
. aoocher, with spocuil n!rpji>iic(> tt) burning for the xale pMltiaii. 
of anything. This kind of racing in bu8.ine9» is *ijy , " 
rw jouht both more intense and more widely extended than Itrfui"^ 
il unj to be: but it is only a secondan,'. and one might 
■Iwd Miy, an uccidL-ntal cuusuqueuce fruin the fundann-ntal 
tbnet«ri«iics of modem business. 

IlMTe ift DO one trrm that will cxpn?Ri thene eharacteris- irat hiU- 
to vlKjuaUily. They are, as we shall presently see, a ccrttun y,^^. °''' 
zii friidence and habit of chooaiug ont_*'s own course forS^^JJ^; 
MKKlf, a self-reliance; a rU-libi-ration and yet a promptness cIiok* ajul 
4(dx)ice and judgment, and a habit of forecasting the future tlioiiRht. 
Orfof ehaping mie's courso with reference to distant, aims. 
IVy inay and uften do cause peuple to compete with one 
IBoUivr; but on the othur hand tht;y may tend, ami just now 
"rfwd thej- are tending, in tliu direction of co-operation and 
*uobuatu>D of all kinds good and enl. But these tendencies 
tvnrds coltectivc ownerehip and collective action arc fiinda- 



INTKODUCnON. 



BOO! I. 
«■. I. 



"ConiDS- 
tlUou' 

impUtia Uk] 
maohu 

W«ll Ml 

MO little. 



IniOt 



tljHIl 

bo wait, 



mentally different from tlwiae of t»jUcr times, bL-cause thej 
are the result not of cualom, not of any pasave drifliu^ into 
aesociatiou with one's noighboura, but of fip&e choice by each 
individual of that line of conduct n-Kich after careful dclibe* 
ratioQ seems to him the best suited for attaiuiug his 
whether they are selfish or unselfish. 

Furth«»r the tenn "L'<nn|>etition" not only fiuls to 
the root of the matter, aixl thuR erm by defect; it also ens br 
excess. For it has gathered about it eril aivotir, and bM 
come to imply a certain selfishnu&N and indifference to tita 
well-being of ntheni. Now it Is true that there is less ddibo- 
rate selfishness in early than in modem forms of industay;, 
but there is also le»is dc'UtH.-mte imselli.^hnass. It is the deti- 
berateuess and not the selfishness that is the charactenEtic 
of the modem age. 

Custom in a primitive society extends the limits of ihe 
faniily, and prfacribes certain duties tu one's ncighlioun 
which fall into disuse to a later civilization; but it also pre- ' 
scribefl an attitiule of hastility tn stiungers. In a modem i 
society the obligations of family kindnees become more in- ' 
tense, though they are concentrated on a narrower area; luid ' 
neighbours arc put morv nearly ou the same footing villi | 
strangers. In ordinan.' dealings inth both of them the fttu* 
dard of fairness and honesty is lower than in some of the 
dealings of a primitive people with their neighbours, but it 
i» much higher than in their dealings with stmngen. Thm 
it is the ties of uoighbourhood alone that have been relaxed 
The ties of family ore far closer and stronger than befonM 
family affection leads to much more self-saeriEce and devolioB 
than it used to do. And uguiu Hym]mthy with those who aA 
Dtrangers to us is a growing source of a Idnd of deliberate 
unselfish ness that never existed before the modern age. 
That country which is the birthplace of modem conipelition 
devotes a larger part of it*i income than any other to charitablsi 
uses, and apeiit twenty tnillions on purchasing the freedom of 
the slaves in the West Indie.^ In every age |M)ets and social 
reformers have tried tu stiuiulatu tlie people of their own 
time to a nobler life by enchanting stories of the virtues of 
the heroes of old. But neither the records of hist<Hy nor the 



CRAFU^CTKRISnCS OP MODERN orSLSKSS, 



iponiy observation of backward races, when carefully 
I, give any snpport to the doctrino that iimu is ud the 
whale hanlcr and haisher than he was, or that he vas ever 
more willinf; than he is now to mottRco his own happiness 
(or the bcucHt of othcns in ctuse^^ where cnstom and law 
hare left hiui free to choose his own oounte. Among races ,' 
whose intollcctuo) cspncity »oenu not to havo developed in ' 
anf otbt-'f diruclion, and who have none of the tni^nating 
pover of the modem businesg man, thcro will bo found many 
who show an evil sagacity in driving a hard bai^gatn in a 
market even with their iKtighbouis. No traders are more 
nuscrupulous in taking advantage of the nuoessilies of the y 
unTortuoate than the com-<lealer8 and money-leudore of the v 
Baot. 

A^ain the modem era has tindonbtedly given new open- nor 
ings for dishonesty in trade. The advance of knowledge has 
discovered new waj'H ofniaJdng things appear other than they 
u«. and has rundcrod possible many new forms of odultcta- 
tion. The producer ie now br removed from the ultimate 
oonsamur; and his wniag doings on: oul. visited with the 
prenipt and sharp punishment which falls on the head of a 
pen«un who, being bound to Hvo and die in his native villaga, 
pUys a dishonest trick on one of his neighbours. The oppor- 
tnnitiee for knavery are certainty more numrnxm than they 
were; but there is no reason for thinldng that people avail 
themselves of a larger proportion of isuch opportunities than 
they used to do. On the contrary, modem methods of trade 
imply habits of trustfulnc-As on the one sido and a power of 
resisting temptation to dishonesty on the other, which do not 
exwt among a Iwwkward people. Instance of simple truth 
and [R'r»i~>iial tidelity are met with under all tioeial cuuditions: 
bat those who have tried to establish a burincfw of modem 
cyjw in a backward conntn,' find that th(>y can scarcely ever 
depend on the native population for tilling postii of tmst It 
is even more difficult tu dispense with imported aesistauce 
for work which call") for a strong moral chamcter than for 
thai which re(|uires great skill and mental ability*. 

> Adoltantina a*il tnad in ItmIk inirn nunpaiil iu tbu niliUlv ss** to an 
KiMaltlttt If Y«fy wnotaMng mhtn m eaMld«r lbs (UScnhUii of wrong doiug 






B 



INTRODCCTIOX. 



Fmeilam. 



VlJui'. 



BOOK I. There are thus »trong n^amnit for iloubting wbcti 

'"•^ ' moral ch&racter of business in the modem age compareti : 
untavuurably (ut in eomrtitnua suppusoi witli that of 
timas. At all events, while the controversy on this point i 
etill uusL-ttk'tl, it is bust to desciibc that churoctcr b)' a 
that does not imply any moral (|ualLti«s whether good or ' 
but whi<:h indicates the undisputed liLct thut modem businc 
is characterized by more eelf-Teliant habiti;, more forethoughl 
more deliberate and free choice. There is not any one ' 
Eeonotnio adequate for this purpose: but FitEEDUM of 1nui;stuy 

Entbhp«ise, or more shortly, EnoNOBnc Frkedom, poinui 
the ri^'bt direction, and may bo used in the absence of i 
better. 

§ 5. There is another word which will be used dtinn 
this preliniiiuiry survey, and of whieh some account do 
be given hero. 

"The word value" says Adam Smith "has two differ 
Dieanings, and sometimes expresses the utility of 80D 
particular object and sometimes the power of piirc^ 
other goods which the posKessinn of that object conrejl 
The one may bi- called value in use, the other value ^ 
exchange." In the place of "value in use" we now s] 
of " ulility;" while instead of " value in exchange " wo uf 
say " exchange-value " or simply " value." " Value ■" by it 
always ni^'ans value in exchange. 

The vakie, that is the exchange value, of one thing 
termK of another at auy place and time, is the amount of I 
second thing which can bi; goi tliure and th(ji in exchs 
for the fiisL Thus the term value is relative, and exj 
the relation between two things ut u particular place 
time. 

Civilized countries generally adopt gold or nlrer or 
as mucey. Instead «■{ expressing the values of lead and ' 
and wood, and com and other things in terms of one anot 
wc cxprcsa them in terras of money in the first inst 
aad call the value of each thiug thus expretised ite price, 
we know that a too of lead will exchange for Hfleen eoveroij 

•itbotLt dotwrtiiii Ml >h»t Um* (eniiiii. OdiankawiM* SnfbtmXa trirtXteXofti 
EnlaiekeUmg im Jut^an^ ik* Jti«<laltrrt,i>f. ti7, uidSH — IJ, 



VALUE. 



and time, whilt' a ton of tin will exchange for 
ninttj soTtTL'igiw, we say that tlicir prices lliou and there 
■R^ta and £J)0 respectively.iuid we know that the value of 
ItDO uf tin io terms i)f lead is six tons then and there. 

The price of every thing rises and falls fniin time to 
tanp «nil place to place ; and nith every such change the 
furdiwing power of money ebaugr» hu far as that thiug goea 
If the puitihafiing power of niuney rieeH with n>gard to Mtme 
ihiap and at the name time fulls equally with regard to 
tipilh iioportant thin^ its general piirchadng power, or Its 
f.tft of purchasing things lo guuc-ml, has rematQed stationary. 
It ii true- that thifi way of speaking is vague, because we have 
»* CMDsidenrd how to compare the importance of different 
Hd^ This is a difficulty which we shall have to deal with 
bur c>D : but meanwhile we may accept the phrase in the 
ng!tt« bat i)aite intelligible usage that it has in otdinuy 

CSfDOBXL 

rhroughout the earlier stages of our work it will be best 
injpcak of the exchange value of a thing at any place and 
ttit as mouiurtid by itn price, that is, the amouut of nioDoy 
farwluch it will exchange then and thprp, and to atwume 
dm there is do change in the general piux;luuiiug power of 

' li tfau irc wv ocil; tallowing Uio fnctlcc of the otiUiiiUT I'lii'i"'^ »' U'*^i 
(tU ta*«rl*lil]r iivla hj comiderinc iiai« rtiiui|{i-* il K tinu! uul iMiUiuiug (or 
I BUt ifaki " otli«r tbiagt tn vpmI.~ Aa ConmoC pabito ont (J*nW(pw 
Adteatigiivj dr la Tktme iUm Rvktui*, Cb. ii. I, wn fot Ibe nmt wirl of 
(■VniMM ttota ■MBBBing Uia AiUlmo* of • MtiLiKliml of uifann iiurr-linnng 
tww tj •hlcb \4t tn^Hnm valoc, tbal utronooicTD iJo hy Mstuaiog Uul tfacn 
t • "M^tn flHs" "liick cfaw ui] tka lUMiilLiui at nuilumi lDl«rriil». hi tlut 
ktdock can fcra|i pac* Titb it; wbt-rnw tli* >rlnal ran rnMNF'* tliQ mxriilliin 
■ilfciii ■ Mtora and KmciiMin aOvr uoou bk bLuwu bjr the duck. 



DD&lt I. 
CH. I. 



CHAPTER U. 



THE DROWTH OF FREE INDUKTRT AKU ENTEHPRISR. 



b4Mdiul 
uiil nee 

■Ct and 

IIBCt 

on an» 

uiucli iu- 
UlLvlJoeilkj 



SAVOgO 

life is Filled 

by CQttOlU 

aticl in>- 

]IUllM<. 



§ 1. The chief events in hiatory are due to tho actid 
iadividuoU. T\m cutiditioiiH which have made tbeae ftT 
possible are oearl}' all traceable bu the itiSuencc of infae 
ia8^txitioii8 and race qualities (md of physical nature, 
race qualities themselves are mainly if not eulirely cou»d^ 
the action of iodinduals aD<t physical causcis in more or) 
remote time. A strong race has often sprung, in loct as 
na in name, from some progenitor of singiilnr strcogthJ 
body and character. The usages which make a raoc 
in peftice and war are often due to the wisdom of a few 
thinkers who have interpreted and developed its 
and rules, perhaps by formal pre<»pta, ptThaps byaquieti 
almost un]H*n.-eived itifliienoe. But none of these things I 
of any permanent avail if tho climate is unfavourable" 
vigour: the gifts of nature, her laud, her watcre,and hers 
dotermine the character of the race's work, and thus gi* 
tone tn iifKnal and political inHtitulionH. 

Tlieat'difffreneesdouot show tht<m&&lves clearly so lo 
man in Ktill savage. Scanty and untrustworthy as is our ii 
malion about the habits of Bavago tribes, we know enough" 
them to be sure that amid great variety of detail they sho« ' 
a strange uniformity of general character. Whatever be their 
climate and whatever their ancestry, we find savages living 
under the dominiou of custom and impulse; Euarcely ever 
striking out new lineH for themselves; never forecasting the 
distant future, and aeldoin making provision even for tJie 
near future; fitful in spite of their servitude to custom, 



■USMOf 



INFLUKSCE OF PHYSICAL CAUSES. 11 

governed by the feocy of the moment ; ready at times for aom i. 

the most arduous exertions, but incapable of keeping them- 

selves long to steady work. Labonous and tedious tasks are 
tvoided as &r as possible; those which are inevitable, are 
dooe by the compulsory labour of women. 

It is when we pass from savage life to the early forms PhTdeal 
of dviUzation that the influence of physical surroundings moat 
forces itself most on our notice. Many of the events even £"^2^^ 
of early history are no doubt to be attributed chiefly ^^ 
to the action of individuals, though our records may be ctro 
alent about them. But in this stage of his progress man's 
power of contending with Nature is small: he can do nothing 
without her generous help. Nature has marked out a few 
pUcee on the earth's surface as specially favourable to man's 
fint attempts to raise himself from the savage state ; and the 
first growth of culture and the industrial arts was directed 
and controlled by the physical conditions of these favoured 
' spots. 

Even the simplest civilization is impossible unless man's wiiieii 
efforts are more than sufficient to supply him with the sariir 
necessaries of life ; a surplus over them is required to j^ ^SraT** 
support that mental effort in which progress takes its rise. =•'«'»*•■■ 
And therefore, as Buckle has pointed out', all early civili- 
zations have been in warm climates where the necessaries of 
life are small, and where Nature makes bountiful returns 
even to the rudest cultivation. They have often gathered 
around a great river which has lent moisture to the soil and 
afforded an easy means of communication. The rulers have 
geoeraUy belonged to a race that has recently come from a 
cooler climate in a distant country or in neighbouring moun- 
tain lands. For a warm climate is destructive of energy ; the linliog 
force which enabled them to rule has almost in every case ^ygn their 
been the product of the more temperate climate of their early t"^5r*«nd 
homes. They have indeed retained much of their energy in police*, 
their new homes for several generations, living meanwhile in iudoatij. 

1 On the genenl qoeatiaii of the inHaeace at pfajncal ■nironndinRB on rtce 
cbmnctsr, both directly and indirectlj, by detenniuiiig the n«tnre of the dominant 
iiiiiH«linn. tee Knies, Polititcht (Bkonomie, and Hegel'* Philotopky of Jliiloty, 
CoqMie alao Aiiitotle'i Poliliet, and Honteoqniea'a Etprit dea Lou. 



BOOK I. 
CB. II. 



Tbain- 
Snuwocl 
■ wunn 

cluitftt«L 



liixiirj' on the surplus pn>duct.H of tlie labour ot the sul^ecl 
racea; and have foiiuil scope for their ahilitjwt iii thi* *orV<^ 
nilers, warriors, and priests. Originally igiioranl, they lavs 
ijiiickly learnt the best wisdom that iht-ir .subjects had t« 
ti;arh, anil havL- carric*! it hirtlii-r; inipnuiiig- the arta uS ]iiD- 
ductiou and extending the boundaries of knowledge. But ta 
thiii Bta^u of civilizutiun an enterprixing luttiUcctual cbancter i 
has atciust always been conBned to the niliag few. it hu ,| 
wurcely over bt-eu found in those who have bonii; ibo maia I 
burden of industry. 

The KOKOQ of this La that the climate which baa recdcnd 
an early civilization possible has aUo doomed It to weokncv*- 
Id colder climates oatare provides uu iuvij^orating bIibd- 
aphere; and though man has a hard struggle at first, yet H 
hiH knowledge and richeti increase he is able tu gabi plentiful 
food and wann clothing: and at a later stage he pnnides 
himself with those large and .iiihstantiaL buildings wliiebur 
the most oxpou«ivo rcipiisites of a cultured life in [)ta«» 
in which the severity of the weather makes it necessary tfaat 
nearly all domestic services and meetiogs for social inlw* 
course ehoiild have the protection of a rouf. But the fnali 
invigorating air which is Dece«sary to the fiilncss uf ^H 
ennnot be obtained at all when Nature doe« not freely pve it*. 
The labourer may indeed be finiiid doing hard physical work 
under a trupicjil »un; the bandicmiWnau may liave artistic 
instincts; the sage, the statesman or the banker may be aenk 
and subtle: but high tempiimturu makes hoid and sustained 
physical work inconsistent with a high intellectual activitjTi 
Under the combinBd influence of climate and luxury ih/t 
ruling class grarUaliy loses its strength; fewer and fewer cf 

' Montwqnlro Mir* iiuviitli- >Elk. siv. sh. 3), Uw( tho M^Mriority of alnnflk 
raiuetl hj » c«U cUnuito products luiiting otfaor vBccti "■ g»«l«r miimi of •apr 
rioril];. Uiit ii. kM dMfre uf ri'Vi-iiiM luitl t, KTvtwr upliiloD of wcnrity. Uiat k 
inore fnuikncu. ten msiikluii. ivoUcj, bnil miiiilui;-" Tbmo ilitoM are od' 
lutikUy li«l|>[nl III iimtiiiitl'T prngmn. 

■ Tliin uii; havu Ui be vi-kMAvA b lltll«. tml 011I7 a lltU«. 1( Mr (iviMn aliotdl 
ptmr tii be ngilil in liiiiiltiiigi that rni-iJl nnmtien of • mltng nu» in * lint (VHinltJ 
H for iQ*liuico Uic Kufiliili li> Iii'tit- will Iw Me to nitKliiiii lli«ir coiuUlatMMi 
vicimr niUBiliBim(l fur maay gcDcr«U?iH b* a Utieml uim gf artificial ice, or of (b 
cooliitc (iffecUi of Uiu lurciliLt ex|HUuii>ii fA oanpraaiad ilr. &«« Ijih 
AddnM to Ui* Anthroialc^cal ItuAJlaU in 1881. 



»FLUEHCE or CCSTOSl. 



u 



BTe capable of great things: aud at last they ore ovcr- 
rD by a stronger race which ha"* come most probably 
from a cook-r cliumte. 8omt:titiiL-M (hey funa au bitenne- 
&I0 caatL' bctu'ccm thciee whom th^y have hitherto ruled and 
dieir new rulers; but more often they sink down among the 
ipiritlefia ma»H of the people. 

Such a civilisatiou has often nincb that its luten^stiug to 
tb6 phitiiKiiphical hiMorian. Tts whole life \n pervaded ahnust 
luicoiisci'jusly by a few simple ideas which are intenvovtm in 
that pleasant bamiony that ^ivus their charm to Orieotal 
carpets. There w much to be leajiit from Inidii^ these ideas 
to their origin in the combined influence of race, of physicn! 
surruuudings, of religion, philosophy and poetry ; of the 
incident-!^ «»f warfare and the dominating influence of strong 
individual charactom. All thiK is instructive to the eoouo- 
miitt in many ways; but it docs not throw a very direct light 
00 the motives, which it in his special province to atudy. 
For in mioh a civilization the ablet^t men lool; down nn work; 
then.' aiB no bold free enterprlxitig workuiuu, and no advou- 
taroUH capitalists; despised induittr)* in regulatod by custom, 
ami vvnu looka to iniatom as jtit sule protector from arfailraiy 
lyTanny. 

The greatM* part of custom is doubtlew* hut a rrj-s.tallizftd 
form of oppre«iaion and suppression. But a Ixxly of ctistom 
which did notlung hut grind down the weak cmUd imi long 
survive. For the Htrong reab on the support of the weak, 
their tiwu Btn-iigtb cannot sustain them without that Kupport; 
nod if they organize social airangement.H which burden the 
waak wantonly aufi beyond measure, tkuy thoroby doni,roy 
themselves, Conwquently every body of cu-stom that on- 
dorua, cuutmnis provisions that protect the weak from the 
oioet reckless formy of injury'. 

In fact when there is little enterprise and no scope for 
efiectiTe oompctitinn, custom is a ncHx-iKmry shield to defend 
pcupitt not only from others whn are stronger than them- 
aelves, but even from their ncighbiiURi in the same rank of 
life. If Ibe Tillage smith can sell his plough-shores tu nouc 



BIWK I. 
Cll. II. 



Id BO Mdy 

civiluwtUiD 

marawHit 

■••loir. 

Irat llitrv u 

niavMUMit. 



CtiKUia l« 
Dtvtf allo- 

Ilip nidi- at 
Uitr MranK. 



■ II J Ik Hi- 
ll l-«ll fl De< 
niHwi}- 
jiroliKlioii 
vlion (lio 

UieBD!) of 
««l|Uilll- 

■r» KiQiill- 



14 



THE OROWra OF BCOKOUJC niEEDOM. 



MMK I. 



'^CMtom it 

ft dbtfutMJ 

lonuctf 

•knr- 

«uuii«- 
titini. 



.wncnUp 
■tnaith- 

[■oMoai 



but the Tilla^: and if the village can buy their skAits I 
no one but him, it ift to the interest of all that the piict 
should be fixed at a moderate level by custom. Thus cnstun 
earun aanotity: ami there \» uothiug in the Jint steps of pro- 
gress that IcikU to break d"wn the primitive habit of n-gard- 
ing the imiovatoras impious, and au enemy. The infliiencg 
of ecoQomic causes is prp.<i»ie<i Ih-Iow the snrface, Thirv tln'T 
work surely aud sluwly : but they take geoeratioas in&lead of 
yean Co produce their effect; and their action ix co subtle H 
easily to tscupe ubsvrvati^in altogether. They L-au ioiieed 
hardly be traced eicept by those who have leanit whcjc tft 
look fur them by watching the mure conxpicuous aiid i&pld 
workings of similar caucsea in modem timv& Thus llu 
"niodeml*; level" at which custom fixes the price of a plough- 
shoru will be found when aiialyscd to muau that which ^ViX 
(he smith in the long run about an equal remuneratifu 
(account being lakcu of all his privileges and per^uiaitoi) 
with that of his neighbours who do equally difficult work; or 
in other words, that which under the regime of frvo cDto^iti^r' 
of easy commauicatioos and etfectire c«mpetitioD, weshouU 
call a nomiaJ rate of pay. If & change of circumstances 
makes the pay of smiths, including all indirect aUow&Dce«, 
either less or more than this, thc-rc almost always sets in a 
change in the Hubeitancc of the custom, often almost unre* 
oogniaod and generally without any change in form, which wQl 
bring it back to this level But to this point we must rettm 
later on. 

§ 2l Thiit furcL' of custom in early civilization.'^ in partly 
a cause and partly a coDSoqaoncc of the limitations of is^ 
vidual rights in property. As regards all property more tff 
less, but especially as regards land, the rights of the individual 
are genemJIy derived &om aud limited by, and in evci^' in} 
subordinate to those of the household and the family in Hn 
narrower nunw: uf thu t«*nn. The rights of the household art 
in like manner subordinate to those of the village; whidl k 
often only an expauded and developed family, accoriling U 
traditionary fiction if not in lacL The affairs of govenunanl 
have always received the careful attention of historuna; vat 
prominetice has been given to the influence which the fonni 



DiFLUEKCE OF COLLECTIVE OWNERSHIP. 



13 



of ^vcmmfftit have exerted on thp cUvelopmfrijt of indoBtry 
mhI a>n)incrc«>. But insufficient attCDtion has b«ca paid 
to that ex«n«d by tbe ooUcctivo ownership of property. 

It is true that in an early stajje i>f oiv-iltzation frw would 
have hod luucb doMiro to dupart for front the procttoes 
that were prevalent around them. However complete ajid 
sharply defined had U^n the rights of indi\-idimls ovi>r their 
uwn prDperty, t-hey nmild have been unvilling to face tbt> augvr 
with which their u(?ighbour» would rv^rd any iuDovation, 
and the ridicule which would be jiotired an anyone who should 
»et himself up to bo wiser than hi« ancestors. But many 
little changes would occur to tbe bctlder Kpirilii; and if they 
had been free totry experiments on their own accouDt, chauges 
might have grown by Kmnll sjkI alniost imperceptible stages, 
until sufficient variation of practice bad heeik e^lahlished to 
blur the cIi-ttT outline of cuntomuiy rcgulalious, and to giro 
eonnderable freedom to individual rhoic":'. When however 
eAcfa bead of a household was regarded as only senior partner 
and trustee for tbe family property, thu smallcHt divergence 
ittx ancestral routine niut with the op|>osition of people 
rho had a right to hu consulted uii. evixy di-luil. 

And further in the background behind the authoritative 
rauatancc of the family was tluit of the village. For though 
each fiuuily bad sole xxm for a time of ita cultivated ground, 
yet often many oper&ttooa were coDduct«<l in eummon, »o thab 
each had to do the same tlungv as the othcn at the samo 
time. Kacb field when its tuni came to be fallow, became 
part of the common posture land; and tbe whole land of 
the vilhigo HTw subject to redistribution from lime to time'. 

> TUoagb Uie Rutttv u ant altoiEtillinrfree trun contrm-onj. thorf hohim gooA 
nawa lu Iwbeie Uiu tlie Tenbiiiic Xlirw Unrk tyauaii «ru o ftarrivtl uf ptiinilive 
cattoHW Uut tuil {imulad, of raiuw «1Ui andlsM vkHvI; to ijptall, ttaoot Iba 
fodktben of DMrij till while t»c**. TV*«B of vach a plan •ifat tvon now 
in liwU* uiJ MiKNi){ Mitaii Ri-lHviiiifr i>ih>|>I<>*. aiiil aiiiiliiipiis ti) it sm fmuiJ muiotiK 
MB* races of oUmi ookiim. lu tbe Tknn Hark itjntiMn. in It-i tjpic^l twm, 
ma Mnalt [ort, Um bmw mark, w** mI atlilr ptimiBiiciiUy for liitut oii. aud 
(Wii tuaiy rotiined iU riiirv tn Ui«t for tnmr. Thu ipmnrl put nr ariiblp mark 
WW •lirUeil Into tliTf* lug? fl*U«, Iti foirlj nt whicli I'tu'h famity hul a ploi. 'I'wa 
i4 Lk*M Wiiva i:u]tt<nili<d artaj ]r**r, u>A ano left (uUriw. TUd UtinI luiil knrmt 
I«r1 *■« Qwwt ■<)• )[Ts>in( Im)J 1>j llii) wliolv viUii.){r in (CiiiiiiUHi; aa •>»■ aiao 
tW bDow AaU In tlie anbk naik. Is wHuacaaw llie araU« mark wa* frion tlvie 
Ut tu» abaodflMd t« puUm. and land la make a ticir arable mark nu cut out al 



BOOS I. 

CM. U. 



16 



TUK OBOWTU or BCOSOMIC FHEEDOM. 



BOOXI. 
QB.O. 



tile 

of tndiuttr 
la«ma- 



TbeOrfcka 
Lbroubt 

ItlarUMn 
— U) 
beuMi 

0l!Mllt4l 

oaltim. 



Therefore the village had a clear right Ui pn^bit any 
novation; for it might interfere with their i^aiw for 
collective cultivation; and it might ultiuiat4>ly impair 
value of the laiul, and thus injure theiu when the tiuw 
for the iiext rt-dUtributioii. lu couHequeDce there 
grew up a complex octwiirk of mien, hy which 
cultivator was so rigidlj bouod. that he could not use 
own judgTDcDt and dixcrelion even in the most trivial 
It is probable that this has been the most imponant 
the cati»e5 which have delayed the growth of the 
Skv enterprise among mankind. It may be noticed 
the collective ownership of properly waa in haimoDy 
that spirit of quietism which pervades many cawteru rcligiotf; 
and that it» long KtinHval among the Hindoos has been 
portly due to the repose which la inculcated in their 
writings. 

It i5 probable that while the influence of custom 
prices, wages and rent has been ovetratod, ite inil 
over the forma of production and Ihe general eco 
arrangerocuts of socit'ty has been underrated. In the- 
cose its eftccts are obvious, but they are not cumulative; and 
in the other they are not obvious, but they are culQulati^t!. 
And it It an aimust universal rule that when the otfectsoftu 
cause, though small at any one time, ore conataDlly wcd^J 
ing in thu same ilirection, their influence is much 
than at firat sight appears possible. 

But however great wok the influence of cuntom in 
civilisation the spirit of Greeks and Romans was full of 
prise, and more interest aitocltes to the ini|uiry why 
economic problems were unknown to them. 

§ a. Tile chief leadenthip of prugrem has fallen Co 
successive ivaves of Ar^'ans that have spread over Kunipe 
Asia fruiu (heir uarly home* in laud* of friwi and an 
Some went far southwants early: early they became 



til* conunjaii mark, onit UiU tnvolv^ ■ redi«lrtbiitioti. Tbn* tht trMbMBt j 

bud 1>; VTvry r»iiii)« hRwImI t'>r |{i>i<il ii lU all <li" niuiitlnin uf Uia villaga. 
< It iDUtUrii liltic tor vox ^aifmix *bcUi«r thit liouc vm ax Mm IcAj | 
Unl tanaa Uiv nnitn) ul tlie Asiatic E«ira|Kiui Coatiuunt, at M mne lunr < 
In Uw iiivUi of Eampc. 



THE UISE VV UKKECE. 



nocNi 1. 
en. n. 



civiijui. 
licnift luvl 
Ixirtictdcil.T , 



1 



if other nations, and early they lost, their best. 

ttln-ii^h uiulur tliu iuriuLnict.- uf luxury uiid a wonii cliiiiaCc. 

But nthf ra went on increaaiug iu strength ihn:>iigb long cen> 

turii>a aiuid thi.' inviguruling int1iiuuiH»i »f a briu;mg climatci 

mud coDstant conHicl; and at last a band of them, spr^eoding 

flouthwnnU from the Danube, fuiind it^-lf in a muuiitmnoua 

Uiid whose maoy harbours opened on the Mediterranean Sea. 

£ocb harbour was cut off from iis noigliWurs by the m^^un- 

tains and was unitetl by th«i sea mth the mo6t suggestive 

thoughts and tny!«torie» of iho world. The Greeks were 

within a few <la\*s' sRil of nearly all that was best worth 

ktiijwing about, whether in thought or IV'«ling, in a£>tion or iu 

Rpiratioa Poraiii, Assyria, Photnicia, Judm, and Kgypt, 

ruru all at thti i-axteru nnd of thiil great sea tliat uniteu Adiii, 

im, and EurojH!*, and India was not far off. 

The new tinpuliw towards freedom in thought and action 

le fnini the gca. Oreai rivor baxlns hod been the hnnu's 

moft of the earlier civilizations: famine seldom vitutiMl 

tbtnr wulUwat«frud ptaius; for in a climate in which heAl is 

□«Tor lacking, the fertility of the uni] varies alniont directly 

with its uioi^iure: and their channels otTen?d moans of easy 

oomruunical.ifiQ that were favourable to simple forms of trade 

abd division of labour, and did not hinder the muvetnentx of 

the large arruii:!) by whieh the despotic forte of the eeuttal 

gOTenuuent was maintAined. It is true that the PhfPiiidarw 

lived <io the nea. This great Semitic rac« did good service 

liv prHparing the way for Iree tnturcuUTse among niuuy 

{M-oples, and by spreuding the knowledge of wilting, of arith- 

metici and of weights and iDeOKanw: but they gave their 

chief energies to c'.>niuierce ami muuu&icture. It wan left 

for the geuifti syiujiathies aud the fresh npirit of the Greeks 

to breathe in the full breath of freedom from the sea : and to 

<!• v.:lop in thoir own fi-ce Uvea the best thoughts and the 

iiigUi»t art of thfc Old WorW. 

Their Qurnberless settlements in Asia Minor, Magna 
Gnceitt. and last of all in ti)i> Pctopon aeauii, developed treely 
th«ir owi) ideals under the inHueuce of the new thoughts 
that burst upon them; having roii»taut intercourse with one , 

utiithcr, as well a» with chose who held the keys of the older i-arlaUoi. 



TbcMa 

pivv th» 
Oroolcn 

frwrluin. 



18 



THE OJtOWTH OF ECONOMIC FKECOOH. 



Tllriitli- 

aaUnn 



did Ml 

urviiKtli. 



itiaagfnt 

lOnUieiy 
didinrt 

Bodani 

MoBomio 

prvbltm*. 



learnmK; sharing- one auother'a experiences, but folteretl hr 
no authtirity. Energy* and enteijHiac, insteail of being re- 
pressed bj the weight of tjaditionol usage, were eucottraged 
to fbuud a new colony and work out new ideas withool 
restraint 

Their cliinattL- absolved them trom the need of exhauKtiuj 
«fork; they left to their slaves what drudgery had to be done, 
and gavv tbemselvi.';* up Iv thv frvc play of their &ncy. 
Houae-roona, clothing and firing cost but little; their g^aitl 
sky invited them to out-of-door life, making intcrcoonc to 
social and political purposes easy and witbont expense. And 
yet the oool breezes of the Meditermncan m fiu- refrealMil 
their vigour, that they did not fur many generations lose tfcl 
iiprixig and elasticity of temper which they had brought front 
their homes Su the North. Under these conditions weN 
matured a senae of beauty in all its forms, a mbtic liuicy ami 
an originality of speculation, an cuerg}' of political lifo, and t 
delight in subordinating the individual to the state, Mich ai 
the world hofi never again known'. { 

The Greeks were more modem in many respects than tjw 
peoples of inediieval Europe, and in some respects were evw 
ID advance of our own time. But they did not attain to tiiw 
oonception uf the dignity of man as man ; they regardid' 
slavery as an ordinance of nature, they tolerated agricultun 
but they looked ou all other industries as involving degiadft' 
tion*; and modem economic problems were unknown to tbeta 

They had never felt the extreme pressure of poveitf. 
Earth and sea, and shd and sky htid comlnned to make H 
easy for them to obtain the material rviqnisites for a perfect 
life. Even their slave.s had considerable opportuuitii 



■ Cotnpum KKnnaBC and nutncb, Pi^tiJutUteht OttgrofkU («■ 
UaJ, (ll. I. 

* "NaRurp "bm niadi iMUlMr bootoiaktn nor bbcknaStba, aaab 
degrade tfae peo|iU eni{ait*d bi Uieiii, mtwnble neroenariea cxolnded ^ tMr «Vi 
jKMdtinn fmiu iNillliral ri^litn ' (I1*to. /.a>r4, xn.> " In the slat* wUelltoM^ 
iruvcninl ttie dUEtMiB...iuu>t UDt leait Uie lilx ot mccJiaiuci (ir tn4aaii«i, tomiUi 
K Ufa la ignolilB and iiiuqIciJ tn liiinn.'* (ArlKlotl(>*B f'jiiUrt.wt.'ii Mealao ni.lj. 
Tbcw paangee glr* Ibe beynuk ot (IrMli thon^ht riUi regard U bmrinw. BH 
of wntiM tliHT* v*xm t«w indujwiiil^iil tDrtiiiii*, vnijwclaUf In iLc vadj <lljs il 
Oneoa, ea tliat tnan; of their tioa Uiiulum it«rv mMiijHtUud U> Ukii 
blletllWi 



TIIC FALL OF OBEECE. 



19 



had it hi-c-n otherwUc, there was nothing in the 
mk temper, aud uothiug Iq the lt.-ti«K>tis that tht: wurtd hail 
f io that tiiae learnt, to make them seriously concemed. 
he excellence of Greek thought has made it a t^iiehstono 
y »lueh manj of the leading thinkers of after ages have 
Bid every new inquiry: and the impatience with which the 
■dnnic mind has often rt-garded the study of economics ia 
It great measure dui> to th<> impatieuc» which the Oreekft 
iitu the anxious ctuva and ploddiug work of buMness. 

yut a lessuu might have bi*eu leamt from the quick 
of Greece; which was brought about by the want of 
eamestneee of purpose, which nu race hai< evor 
ined for maojr generations without the dii<cip1ine 
ily iudustn,'. Sot-jally ami inl.t?lltrtually they were 
■: but they had not learnt to use their freedom well; they 
svlf-mastery. no steady persiBtent rL-solutiou. They 
the <|inckness nf ppreeptinn and rradinew* for new 
iq^JoDS which arc fltniciil.-! of biisineai cmterprise; but 
hrt' had not tte fixity of purimse and patient endurance, 
riie^nial i-Iimale gradually i-elaxed ih<nr physical energies; 
Ik; wtrt without that safeguard U> strength of character 
HdcIi comes from rufolutu and stcdiiuit peE»L;<t<jnec in hard 
*vk; uid they sank into fnTolity. 

^ fc Civilization still moving westwards hod its next 
»ti» in Rome. The Romans were a great army, rather 
haajnAt nation. They resembled the Greek* in leaving 
viiKW OA much as ponsible to slaves; but iu most other 
fyiiu tren? a contnutt to them. In oppo»itioa to the fresh 
Um« of the life of the Greeks, to the youthful Joy with 
tiidithey gave free play to all their faculties and developed 
Ibnr own idiusyncracy, the Kuinan» showed the firm will, 
hf itiTD nsoludcm, the ab8orptit.in in dctinite serious aims uf 
re tnan*. 

tanAwDattU] »ii|iaeiUi(iu bslwaeB Uie (fre<<li anil ItoKiui temptn im 
ifcdMr k]r n»c*l in fak PUlampkf 0/ }liior>). Hr caIIm 11i« tr««daai ll«n 
l*«4ac*tftil, «lR4b*ir <A Uii>ii^ or *«lion, i^'^Vr'if'f /rtrdotn; mhHtht giMa 
I — — •( f^fyiitirt /n«ilom (u Um frmdoiu from wujrwmnliMiM, "Uh) fre«4ou 

ifteil wUck t4pMa ou lUdf, klMolot* MU-Uvt^nBluitton." rko tonutt 
■ipd to Uk Om^A ibe bttcf Ui t^ Biniuuiji: wliUv tbn Teutonic Mpirlt uudvr 
> Mti^ia tf OifMtUiiltjr U nnUloii Uw Iwu uid woririni toward* ccini]itct« 
dm. CMB|ar««boKaalx. f«bn«li>iHii)r<'«r .VoliouuICSt-ou-vi'iiV. Blc. i. 



ItOOCI. 

cir. It. 



Tlieir 

iraputlBiic* 

oflbo 

ut ittotAj 
iadnitiT 
lad to 
tbelT tiUI. 



Tl;e 
nlrvn^b of 

clinniutur 
of ihc 

RdlCUUlH 

ntteil tliem 
tur buai- 
ii*«a, bat 
Ihoy pro- 
fi-min to 

bj tii« 

(vroid. 



so 



THE GROvrrn of econouic frkeiwu. 



aooxi. 
OB. n. 



uadUnu 
•xtfUd 
UttlitUnat 
InBsnoe 

' «i«iM«. 



Bat in- 
, dlncUj 
''Ui*j in- 
|i Ihuiiimd it 
-lorgiMit 

' Uld DTll tj 

foiuiiliiiK 
tlii^ uiu iIltu 
Ian III 

jiTupurty. 



, ■pliT 

coamo- 
pollUu 

of UiH Ut«r 
Bnngjui 



They were strong aud daring, steady of puipree 
aWndant in resource: they hoiJ in ruiiittant iLse »11 die 
fecultiea that are required for biiniiie^ euterprise. Singulari; 
free from thi; n^troiiito of custuin, uvury onu shaped hisutn: 
life for hiniaelf with a deliberate choice that had never beai' 
kiiuwu befori^ : in fact the freedom of trade, of comroero^ iolj 
of uiovotiieut throughout the civilized world wae iu soi&c 
rcspeots greater in the days of the Romaa ctupire thuu ij 
even now*. 

But as soou as Rome ublained domintoii. her al 
dtizeas withdrew themselves Irom business, and gare their, 
strength to politics, to the arts of government, and tosoMJ 
slight extent to the art^ of cultiin^. They rcspoctod agrica^i 
ture; but thoy allowed targe lariiis worked by slavws to lakB 
the jtlace of the small holdings of frtienien. They weretqn 
DO ini'aiis superior to the lu.il for wealth; but they aojiilnJl 
il by the aword. Siu gained it led to a hardueiBi of uplnt auij 
a reckles!« wickeduem of luxury' nmid vrhich Rome fell, bsriqg | 
done evuti \(-es than Greece had done towardii iuveKtigattog' 
the economic coiulitiuns of social well-being. 

But yet ill one direction Rome hiul a great infliieuce< 
succeeding economic thought, for she laid the foundatk 
j iirispnideuef. What philosophic thought there wasin 
was chiefly Stoic; and most of the great Roman 8t.oiat 
of Oriental origin. Their pbtlmsophy when transplant 
Rome developed a great ]>ractical power without loaiogl 
ititcinHity of fueling; aitd iu spile of its scveritv, it had in it 
much that is kindred to the suggeitUous uf modem iwdil 
acience. Mont uf the grvnt lawyers of the Empire wtw 
amoug itfl a<ih(!rcnT«, and thus it t^et the toDu uf the later 
Roman Law, and through it of all modern European U*- 
Now the strength of the Rurnan State had caused State rigbtt 
to extinguish those of the Clan and the Tribo iu Rome at » ' 
earlier stage than in Greece. But many of the primitiw 
Arj'an hobit« of thuught as to property lingered on for a to"K! 
while even iu Rome. Groat as was the power of the hoad^ 
the family ovi^r its uiembera, the pro|Ktrty wluch be VfB^ 



ROH£. 



SI 



'or a long time regarded as vested in him a-s the 
ivc of thv family rather than lut an mdividiial. 

vbeu Rome had become imperial, her la<n-)-ers became 
to intcrpretcre of the k-^ rij^hts of mauy nations: 

mder Stoic intliience they set themselves to diacovi-r 
1^ fUadameDtal Laws of Nature, which they believed to im- 
dttbe the laws vi all nations. This search for the essential, 
■ appoBud to the aocideatal clf>niont« of juMico acted as a 
pMterfbl Solvent oo rights of common holding ff>r which no 
otlwr n>afion than that of iwagr; cnnld be given. The Iat«r 
Somiu law lh(^n-fon> gradually but steadily enlarged the 
ifA^reof contmci; ga%'e it greater precision, greater elasticity, 
mil i^reauo* streagtL At laat aimoKt all social arnLngem(>Til.K 
Uocote uoder its domioion; the property uf the individual 
flk dearly laarked out, aud he cniild deal with it aa he 
(leurd'. We see then that from the breadth and nobility 
tixiw Sl/fic chamcter niocieni lawyera have- inherited a high 
tjamiani of duty: aud irom its austere self-determination 
tiwT hove derived a tcndeucy t>o define itharply individual 
ri(thl» in property. And therefore to Roman and especially 
^Me iofluL-uce we may trace indirectly much of the good 
^^ihil of mir prf^ent cronomic s^ntcm ; on the; one band 
omdi uf the untrainmelled vigour of the individual in manag- 
ii^ hi* own ofliuR!, and on the other no* a little harxh wrong 
diBie under the cover of rights established by a system of law 
vtoch haa held ita ground bt^nusu it« main principU-K arc 
"wudjtist. 

Ibc tttping sense of duty which Sloicium brought with it 
ftom iiB Oriental home had in it something also of Eastern 
^wrtMn. The Stoic though active lu well-doing was proud 
iTUng roporior to tbe troubles of the world: he took his 
Am in the turmoil of life because it waa hi» duty to do bo, 
hut lie never rvcnneilctl himswlf to it: his life remained sad 
■d jlern, upprus^ by the cousciou»ini.\<» of it£ own failurL'i4. 
Tlu iaoer contradiction, nn Hegel say>;. could not pass away 
uHiu^'ard perfectiwi was recoguized Bn an object that euuld 
feuuined only through self-renunciation; and thus ilJi pur> 

' tt i^m4« tb« wboie of tU* lalqael, trwgltiTiTnwH orr» eoiuipieiiuiu det/U U> 
^Ulitj Hum* wtiOMtt*. 



nooxi. 



MUum 

tbaaphoM 
«I cm- 
tract. 



Tliepri-lo 
nud •imCUy 

of tlic 
Stoica 

lliEir lii« 
of iuward 
lurnnnny- 
T1.C 
iceuD- 
cUifttioB at 
■ocial ilu- 
tM» iritb 
■ nlrivbia 
fldrr |>er- 



ss 



THE OROWTU OF EOONOIUC FUEEVOU. 



BOOZI. 

«B. a. 






Tlio 
Teulou 

■low 111 

Imud from 

ttaoM 

vbon 

qii«i«(l. 



suit wsui recoii{;ili?d with tliosp Tailurcs which nece«w.ril5 
cnnj[«iiijnll social work'. For this groat change the Jnt 
religious fceling of the Jgws prepared the way. But thfi 
world was not ruady <c eutur into the fuluess of the Christlui 
Kpirit, til] a new tone hail \ievn given t« it by thy deep 
peraouol affections of the German mce. Even among th« 
German penplfs true Christianity iniKle its way hIowIj*: ami 
for a long tinic aSter the fall of Rome there was ch 
Wt'stt-ru Europe. 

§ 5. The Teuton, strong anij nwtiluto aa he was, 
%ery difficult to frt-e himself from the bonds of custom i 
igiiomnce. The heartinesfl and fidelity' which gave hii 
8]iei:ial strt-ugth, ludiucd hiiu tu cherish Livcrinuch theii 
tutions and cuKtcm» of his family and hus tribe. No o( 
great conqueritig nux hae shuwii so little capacity as ths , 
TeutoDD have dune fvr adopting uew idea*) from tlie mon 
cultured, though weaker, people whom they conquered. Tb^ 
prided thcmeeWcs on their rudo strength and entrg)-; wiil 
cared little for knowledge and the arts. But these foutid t 
temporary relitge on tht- Eastern coasts of the Mediterraufsu; 
until another contpieriiig rac*^ coming from the .nouth vu< 
ready to give them new life and vigour. ^M 

The Saracens learnt eagerly the best logons tliat w' 
conquerei) had to ttach. They nurtured the arts and scievciii, 
atid kept alive the toich of learning at a timu whea tlitt 
Chri-stian worlci cared little whether it went nut yr ncrt; 
and for ibis we must ever owe tlieui gratitude. But llieir 
moral natun? v/iin not so full as that of the Teutons. Tlo 
warm climate and the i^ensimlity of their religion cuaei 
their vigour rapidly tt) decay; and they ha\'e exercised vwjT 
little dirw:t influence on the problems of modern civtliiatioB*. 
t«ior on The ediication of the Teutons made slower but jiurer pw- 

laoi^ greas. They carried civilization northwards to a 



Oar debt 
totlw 

8anc«u». 



* Hk%«\ yPhi^oMph^ oj' Hiiiarn, ful TV.) gt»* lo the root uf Die nulli 
bfi qwoiLii III lliitir Ktiurjij. Uwir lr«s i>l>iril, Uivir AlrMiluIii iwlf-iU'lv 
(EifBiuriuu), Uicir iicwtuiMii (Cvinutb], tod »i|i|i, "KiiMit.v is Iboir vecotid^ 
woird M Frocdoin u ttic fint.'' 

■ A briUuuit ooludr ul lUcir nork in i^rtu Igr Dnpor, taUthctvai bc9 



THK TELTO.VH, 



23 



tbidi sustaiDCxl hart] work ha^ gouc hand in hand with the book i. 

iim growth of tstiirtly (onus of culhirc; and they carried it ""' " ' 

lotnrds U> the Atlflntic Civilization which hati long agn "^^u 

hit the ehoKS of the nvers fur thoi^e of the j^at inlaod sea, wo«twardi^] 

CM ultiuiatvl^' tv travel over th<L: vast occau. 

But th«w} ohaii£«s worked tliemsch'CH out slowly. The u>ii ttM> 
, , . . . , ... old fflntMt 

Kit point of mterest to ua m the new affe is the re-opcmng wiw^™ 
ef (lh> o)d ooDliict bctwK-cii town mid nation that had been J^u,''t;^'' 
mifeaded by the umveraaJ dominiou of Rome; which was i*"'''"'' 
iidfiHJ on array with he«d-q(iarters in a town, but drawing 
in power from the broad land. 

$ 6. Until a few years ago complete and direft self- fio l«ig 
pwemmeut by the people was unpofiaible iu a great nation : it "», ,^ 
omM exist only in town.i or very small tcrritorief. Govern- J^^'5!^|',',t'. 
MDt was neceasarilv iu th« ImudM of thu ft-w, who looked il'irv™'*' 

* . , (MMOID la 

flpoo themselves as privileged upper clas.'ws, and who treated ■ lusu 
ll» worlteni as lower claiweH. Conset[uently th« workers, canU anU 
wtD when pennitl*il to manage their own local affairs, haii tin.'^^" 
Ba* the conrag«, tht* M*lf-relianct!, and th* habliM of mental '""/"f^^ 
irQiity. whieh are retjuired &» tho basis of businees oiiti?rpria0. cammon 
And aa a matter of fact both the central {lovemment and the 
local Duf^aftat did interfere dirt'ctly with the freedom of in- 
itatrf, prohibiting migration, and lov^-iitg tuxes and tolU of 
iW moet burdensome and vexatioUB character. Jvven thtise of 
tin Imrcr clotiMtja who wen- nominally fnio. were plundered by 
•riiitrar>- fines and duos levied nnder all maimer of e-xouses, 
bf thu poitial adiniutatratiou of juittice and often by direct 
*lolciice and open pillage. These bunlcnM fell chietiy on 
JM IhoK people who were took iuduatnous and taorv thrUly 
•bfc Ihi-ir neighbours, those among whom, if the country 
W he«n free, the spirit of free enterprise would gradually 
W« arisen to shake off the bonds of tradition and custom. 

Far different wa« the state of people in the towna There Bot Uiw» 
^ iadustrial clottses found strength in their numbers; and aiviy* im 
"w when unable to gain the upper hand altogether, they ™^'^' 
WK Dfti, like their brethren in the conntrv. treated as"'™*'', 
mogh tbov belonged to a different order of boiuga from tnihefrM 
iVsr nil(>n!i. In Flonmcv and in Bruges, as in ancient 
Athene the whole people could hciLr from the loaders of 



t* 



TBB GBUWTU or EOOXOKC FREEDOM. 



BOOS L 

CK. n. 



fiodiuia 

IHIwlflKlbc 

fint limi' 
puMiljlr III 
• larEc 
wtiiilr;. 



fSiribwr 
Uai i> ex- 



public policy a stateDient of their plans and tJie reaBCiu hi 
iheni. and could signify tbvir ap[tft>val ar disapproral befm 
the oext Htep wan taken. The whole people could dJKOB 
together the tiocial and industrial ]>robleius of the lime, 
kuowiog euch ulhcr'a counavl, pmlititig by each otJMi's 
experience, working out in common a definite resolutioii and 
hrinj^ng it into effect by their own action. But nothing of 
thib kind could be done over a wide una till the inrentio 
the telegraph, the railway and the cheap pres& 

By their aid a uatiun can now rend iu tlie morning - 
iin leaderi) have said on the evening before.; and ere auottieri 
haa pafued the judgineDi of tliv naiiou un it is ]»n:ttj- well 
known. By their aid the council of a large trades-unioo tM 
at a trifling cost eubmit a difficult questioQ to the judgueai 
of their m<>mbc-rs in every part of the country- and get ikw 
decision within a few d&yK Even a large countr)* can uow Im 
niled by ita people; hut till now what was called "pojiaUr 
Oovemiuent" was of phjraieal uecosaiiy the govemmeotbyi 
more or lefB wide oligarchy. Only those few who ecnU 
theinselvefl go frvqueutly to the centre of (i<>vt>niiiient^ a 
who could ac least receive constant coiumunicaliuii fnimit 
Could take pan directly iu govemmvnu Aitd tliuugb i 
much larger number of people would know enough of what 
was going on to maki> their will broadly effective, thiou^ 
(heir choice of represcntativoe, yet even they weire till afe* 
years ago a very smalt niiuorily of tht* whole nation; and ih 
reprenentative syRtt^m itself is only of recent date. 

Switzerland iitdeed has bevu free: for its mountains opfK* 
hindrance to the ninvenienta of large annies, and reade 
cavalry almost uswless; and ii has uourished a sturdy rac 
which has been strengthened from time t4i time by reJiign 
frum ainoDg the bolder spirits of ueigbbouriug landa Bo 
tho mtige of intcrcourMc of thone who live in inountaii0> 
generully small Exocpt when enriched by the lavish oxptf 
diture of tourists from more Ia%'oured lands, they live h* 
lives, overworlted during their shurl (tumiuer. and stagnatiii 
in cloae ronniK during their long winter. They have D> 
bherefore had that mental acli\ity and enterprise which h 
characteiia-tl the frue cities. 



MEDIEVAL FKEE CITrES. 



Sfi 



Tn the Middle Ag;e8 then the hiHtorj' of the risR and 
iiU o{ towns is tho histury of ihi- rist- and fall of siircefwive 
nra oQ the tide of progrt.-s'i The mcdlxt-N-al towii9 ax a 
nk uwed their oripii tti industry, nnd did iiut despise it. 
Aid tbuugb wealthier citi2eD» would oftL'ii succeed for u 
Unt a DstabUshing n cltme goTemment in which the workers 
M M part, the}' seldoni retained their ]X)wer long. As a 
All (hfi gn»l body of the iuhabituatit n-ore full citizciui, 
icMog for themselves the foreij^ and dunieHtic policy of 
Art dty, and at the same time working with their hands 
adttking pride in their work. They organiifed themselves 
into Gildfl, thus incremung their n:ihc.^on and educating 
tUaorlves in self-government. And though their 8olf- 
iapuavd regiilatiuns jtpovcd iilttniatBly oppresiiive, they fitted 
ik ouidtlions of iudustry lor n long titiifj so well that, their 
|nmK was not felt. And as they cuuld be altered delibe- 
Mtlj when therw waw any strong occiuion for change, there 
nti ci«ii|MirtitiveIy little uf that duniluiou of euxtom which ia 
in«Btq[ma.«l aad therefore deadening. The snm'e raimpact* 
iMi»hich rendered it possible for the whole people t« meet 
kptker for p.i!iiical purposes, enabled them (|uickly to 
tgmaa any chang** that their indnstrj- might iei|uire. 

Jb dnu; went cm they gained culture, bub without losing 
ttogf; wiihout neglecting their busmess, ihcy learnt to take 
u uttelligcut interest in many thiiigH besides their bu.sines& 
>uef were thus the tnie precursors of modem industrial 
nilUition; and if they had I>i-en li-El lu go im their ronnie 
U&twbed, they would pnibably long agi> have worked out 
^ Wutions uf niujiy economic problems which we are only 
W bcginniog to lace. But after being long troubled by 
^■BiiJte «ud vnr, they at \mt euccumbed to the growing' 
■ilili^y power of the countries by which they were sur- 
"nrndod 

j 8. FoudalLsm was perhaps a neceasaty stage in the 
■nlojitncnt of the Teutonic mce. It gave scope to the 
Httic^ ability of the dominant cta^, and it quickly brought 
■iM and tnrbulcnt people into aome Hort uf discipUne an<l 
'inier- But it couceaJe<l imder forms of some (intward beauty 
ondi oruelty and uncleauuess physical and mural. The 



noox t. 
OB. n. 

Tfao MaII- 
n'val luwns 
»«T* tbc 

rnrKin 
ut niotlvrii 

I II it Ti stria] 
rlfiliiM- 

tluD, 



Itat wan 



Cliivalry 

n Iiieli 

Cllll" of 
lioiioitr 
Iriwsrils 
IboM! wIki 

bnrii, lint 

it lIMll 



Tlir. OIK^MTII OF BCOXOUin ntCBDOM. 



MOOSl. 

CB. It. 

lianli 

cUnn 

latlwJr 



liolpp'l Mm 

frMdon 
tuMne 



practices of chivalry combined extreme der<ETence to women 
in public nith much domestic l,<irraiuiy: it combined clabumli; 
rtilc* of oourtcs}* towards combatants of the knightly order 
wiih tTuolty and extortion in dealing with tho lower 
classes. The rrilinjf classeg were expected to discharge their 
ob)i|;attori<; tuwunls oiio another with frankness luid gont?- 
msity': they had tdcaU of life which wore not devoid uf 
Qobilily; and tben-furt! their i?haructer» will alwa\*s have wtme 
sttr»ctiveDC8s to tho thoughtful hbtiuriau as wull as to the 
chronicler of wars, uf H[>letHlid Khous and of romantic ind- 
dtmt^ But thoir conscioncos wero eatisfled when ihey hod 
acted np t« thu code of duty which their own clawi reijuired 
of them : aud one article of that, code was M keep the lower 
claasoa ill their placf ; thongh iht-y wvn- utlen kind and (fvew 
affectionate tnwardi* thost? retiiiners with whom they lived in 
daily contact. 

So far as cases of individual hardship went, the Cliurch 
strove to defend the weak and to diminish the sufferings of 
the poor. Perhaps those finer nat<iires who were attracted to 
ibe service might of\vu havu exercised a wider and a liel:t«T 
inSuence, if they had Iwen free from the vow of celibacy, 
and able to mingle witli the world. But thifi 15 no reason for 
rating lightly thi; benefit which the clcrg)-, and vtill more Uic 
TnonkB. rendered to the poorer classes. The nioua6tcriee 
were the hoiuos of induam', and in particular of the AcientiHc 
treatment of agriculture: they were aectUM) colleges for the 
learned, and they were hoRpitaU and alms-house-s for the 
HufFering. The Church acted as a i>eace-maker in great 
mnttots and in small: the festivals, and the markets huld 
under its authority gave freedom and safety to trade*. 

' TieacbMT yiao banenr coiuuraii. IVtipIc miDi<wiMJ tlio itMth nl tMr 
•oqaaiiitantin \ry ■wiiiliwltiiii atnl pcitaoti: llir bust n-as oftcu eiprrtrd to Uulv 
tli« fuud aud drink whteli tui uOenxl to bu guML. Bol an n luioUir rii)kU7 
ftUs Ilia cuutva wiOi Uiv nuldesl twvs 1ih cui KmL uid k«>|* iu tli* bwk^nauiil 
an unitSi M fHHBlhln «njthlii|[ UmI U dli|nuUiif>. to itm pufvUr hiUorfaU) n»y t* 
Jiutiilfd in Mi^iting tlie cmiilatiMi of tbo ^Amip )<; liUtAric*] pictoM* lii whieb llin 
I!t«« 'il iuiIiIt iiim ami iraiui^i ■tniiil <mi iti bnlil relict, vliilc > "vil n dmirii uver 
nucli lA tiiv nrroiiiidiiiK doprktilT. Wlies liowiMcr i<r nuit t« lake ntock of tW 
tnuvld* |inii;nwi. wu iui»l nclciiu tlii^ eiil of pait tiuuv u b rrall]: mu ; l<i Ixi niatr 
lluuiliMltooiiTaiimit'lni itUkni tolMltaalLui Jiut to (lie bMt bn|w* of nur rarr. 

< Wb arv )iL-rba|>> a|it lo la; luo mneh atnu uu tlit cundMuialiMi \rf 
Cbudi of "KMnr" aad mute, llwrr wa« thm ttij little ki)]i« for lo 



^t tBOjr EC MtriKflT £jiiiif. I: -was jiSesi^ milJii^ V' T»»r s^ 
•att ioptSE lists "^K Wuesc 3tiBt ^ -wstiaevfr 3sad: UH*t ««««■ 

■ac 9UE1L -wwl-nsniir ic -late iiMVtu; sac r: jvuumnM^ rtm. M 
liieu. TL naex. — m~miT h "nkt- Txraaan' ."C i^kot Txjm;. 

fim 3i ra£ iiiE «h: rswtf •: xkct latfoc v- df 'W4.'«> ilirar >mi 
Wm'nJHy ic atd?-gBigoifg sic i«C^oewn&3iKa.-<L. Ja>£ lo *nast * ^ 

Xac €Knf90iiuk^ sK^m^ ^ftjf!£^ sftirvJiS n5*r i^-ceu:): iis .'>««i 
oSoH^ 'W' ■sat rifnwsa T*a<s& n faeih*fc Tuiier i^tun ia»«««^ 
?^^im» re ipa3k^Eii::2K£r ifa>ieaivtcTK>feM^ lik^ wt^u^; 

VST OEVeoasL'; at ii^:e«' aK'^Tve Uteao. TecTiviv >M>tHh«ii 

far -^t •iemei^3itK impa^cinlT miikf$i<x'«d a$ iltor v\>n\ i^' itx^ 
CbsauB TeJi£^:n vith i«c;ud to the du^uiy <>) nwut «s nuui. 
XerorJieJesF ii>e rakjs of tbe rt«*inirf tHsmofs vhiiini; iJh" 
taitj iciiiie a^es nciitc^i all ihai w*? !»>»■« jvwvtiVi] in iho 
t«i=s.iai suVik-TT (tj liwuxiaric c*sio a&ti in the Koiivut fivnt 
i4" djg cip citc azkd i*s«c-Jorion. ami used their .>««biiu>i ^mvw 
in foch a maimeT as <« the whc»le to retanl the ji^Txwth ot" 
stK-ngih and indepeodeiKe of ehanieter anuW]; the lo«\^r 
ordere oi xbe people. 

The militaiy fiwce of feudalism was how\^\-x'r tVv ti loi^i; tVo.!*! 
time weakened bv local jealousies. It was adinirablv adttpt^nt MSt^'«»<> 
for welding into one living whole the gt^vemment of a vast *' 5[jJ>- 
area under the genius of a Charles the Oi\*At: hnt it was [*' ^ 
equally prone to dissipate itself into its ctmstitueiit etemoiitii .<i««Ukn>«i 
as soon as its guiding genius u-as gone. Italy niis for a long .Viwtif 

UivciUm. 
c«I>ttBl to be iu«d in bnaosa, M>d vb«n ttais« w«», Ih' prtihitiitliiii i<i>hM h<< 
eroded bj- manj deTk««. ione of «bkh ww* UHWt) luux'tiimvil h,T llii> riinn't) 
itieU. -ind thon^ St Chirsostom nid Uut "be nho {iniraroii au KHioli> lii mkk<> 
ptti&t by dupocing of U entire and unaltered, is cjivlnl fttitii tlii> l(>iii|tlp >it l)i«l," 
Tet tbe OiBicb taeaangeA mercbutts to )in,T and sril kimmIk niiahcrtiil al fiiini aitil 
ekcwbere. Tbe antboritj of Cborcb and Sut« aitd tlie prejiidimi nt (lie iM<(>)>1e 
nmbined to persecute all "tetailera aiul rvtnrktors." Itut tliouxh iiiui-li tit tlio 
bonnea of Ibcec people was legitimate trade, soiuo of it vai rerlaiiily atialiviiua 
to the "TtngB" and "coniera" in modem prodoM marketa. 



•28 



THE GROWTH OV ECONOMIC ntEElWM. 



BOOK I. 

em. ti. 



BDtthe 

IffOgTCM 

niHiV 

thflnvan- 

tknaf 

printins. 

nuUon. 
■uul lilt 

New 
WorM- 



Unie iU» 

<«Terw«> 

vent tu 

tbo 

SpHUiialt 

peobmlii. 



urpoee 

nodeana 



time ruled by ite towiw, one of which indeed, of 
deaceot, mtb R^Huan ambitioQ and hard fmty of purpose 
held its water-wny» against all attack till (|iut« mc 
times. Aud in the N*^therlau<U aiid other part» of the 
tinent the free towns -were long ablo to defy the hostility \ 
kings and barons around them. But at length siahlp 
mouarchieH were e!>tablL<ihed in Austria, Spain and France, 
A despotic mooarohy. served by a few able men, drilled ajid 
organized thi; military- forces of vast multitudes of ignnnnt 
bat sturdy oouutn* folk : and the enterprise uf the In 
towns, their noble mnibination of indtistty* and culture, 
cut shi'jrt before ihcy hatl had time lu outgrow tbedr 
toistakcs. 

Then the world might have gone backwards if it had not 
happened that jiutt nt that time new ftirces were riaitgi 
break up the bonds of constraint and spread freedom 
the brutwl land. Within a very jihort period came the in« 
tion of printing, the Revival of Leftrning. the Refunii 
and the iliflcovery of the ocean routes to the New Worlti 
to India. Any one of these events alone would have 
sutficicnt to make an epoch in history; but coming togelber 
as th«y did, aud working all in the same directiim, it 
effected a complete revolution. 

Thought become comimrulivuly &cc, and knowk 
ceased to be altogether Jnaccesaible to the people. The 
temper of the Grcok? revived; the strong setf-detemunis 
sjMrita gained new strength, and were able to extend thei' 
influence over (tthers. A new continent suggested new pro- 
blems to the thoughtful at the same lime that it offer 
new scope to the enterprise of hold adventurers, 

§ 9. The counlries which look the lead in the ne'*'^ 
maritime adventure were those of the Spanish Peninsula. I* 
seemed fora time as though the leadership uf the world having 
settletl tirst in the moitt easterly peninsula of the Meditvnn- 
Doan. and theneo moved to thy iniddlo pi^uiusula, would 
settle again in that westerly peninsula which belonged Iwth 
to the Medirerranean nnd the Atlantic. But the power «f 
indui^try had by ihht lime become sufKcieut to susLabi wealth 
and civilization in a northern climate. And the Spanish 







TBB aUORBS OP TDB ATLANTIC OCBAS. 



S9. 



BOOK I. 

<;ii. II. 



could Dot hold their owu for luug u.gaiii^t the 
siustamed ouorg}* aud thu more gi-ncroiiK spirit of the 
Hrtbftn people: the colonists of England. Hullaud. &ud ewu 
Fmo) daouiKlod and obtaiued lor mun: frvcduiu than thuBu 
t/SpuD aiul Portugul. 

n« eurly butory of tbo peo])lc of the Xvtht-TlaiidH is But K>on 
UKJeed a hfilliant romance. Founding themaelvc8 <:>n hshiog ^nw aa. 
indwcflviDg, they built up dl noble fobric of Art and LiKira- "HiAIwmI; 
'uA, of Science and Gov^mmcnt. But Spain set herself to 
mdi oat the risiag spirit of freedom, as Persia hod douo 
btiiK. And as Pcriin tttmrtglod Ionia, but only raisod yet 
liijhef the ftpirit of the Poloponnesus; so ihi' Anatro-Spanish 
i'ioptre subdued the Belgian Netherlands, but only roused 
'.W lAlmtinn and energy of the Dutch Xelherlands and 
Eiigsuiii. 

floUaod suffered from Euglaud's jealousy of her commerce, 
iot ttill more from the rvstless military ambition of France, 
hxwD became clear that Holland was dtfeudiuj^ the frue- 
4)11 iif Europe against French jijfgrx'ssimi, Bvit mir Stuort 
King:; «)U1 their country for Frc-nch gold; und it wim tint till 
Ite* thai England awoke from the slumber of a Circjeau 
dt^iaiiattoD. barely in time to save Holland from deHtruction; 
vtim her bfuvest and most generous sons had already 
fcniluid on the battle-Beld and she was ovLTbunleiu-d with 
debt ShcT has fallen into the background: but Kngli^hmeu 
•bow all othen arc bouuil to aduiowlt-dge what she did. and 
■W more »he might have done for freedom and enU>rprise. 

PiBDce and Euglaud wore thn» left to contend for the toFnitw; 
•que of the Ocean. Fmucu hud greater natural roHonrces 
ibnuny other northern country, and morv of thp spirit of the 
)n>gethau any eouthem country; and she wok for »uiiie time 
tbf gratt««t power of the wi^ld. But uhe squajidered in per- 
^ttial wars her wealth and the blood of the beat uf* tliouj 
oUwiB wbnni »bo had not already driven away by religious 
foiKUtion. The progress of enlightenment brought with it 
■ -aity on the part of the ruling claas towards the ruled, 

ii^< wisdom in expenditure. 

revolutiouan' America came the chief impulse 
a risiDg of the opprcsned French people against (heir 



30 THE OEOWTH OF ECONOMIC FEEEDOM. 

BOOB I. rulers. But the French were strikingly wanting in that self- 
' "•" ' controlling freedom which had distinguished the American 
colonists. Their energy and courage was manifested again in 
^^ the great Napoleonic wars. But their ambition overieaped 
itself, and ultimately left to England the leadership of 
enterprise on the Ocean. Thus the industrial problems of 
the New Worid are being worked out under the direct in- 
fluence, as to some extent those of the Old World are under 
the indirect influence, of the English character. We may 
then return to trace with somewhat more detail the growth 
of bee enterprise in England 



CHAPTER in. 



OF FREE INDUSTRY AND ENIERfRISK CONTiSUED. 



nolasd's geographical position caused her to bo """* '• 

the struDgust members of the stnmgi^st races of 

iwdnni Europe; a process of natural selection brought to ^i^^ 

Wiktm Ukmc membeis of each Bucceswive inigraKjry wave i'i"s'>«i'- 

*Unre most daring and self*retiant. Uer climate is better 

lulled to sastaiii energy than any other Jii the uortliem 

^ouiipbenL She is divided by no high hilU, and uo part of 

W unitMy is more than twenty miles Fmin navigable water. 

9i llius there was no material biudniuec to frceiloin of 

Mataone butween her chfTerent parts ; while the strength 

ftd »ise policy of the Normuu oud Plautagoiict kiiigs prc- 

iwtcd artificial barriers fn>ni U-tng miffed by local magnates. 

Ai the port which Rotae played in history in chiefly 

*«i'I»htrr hai-ing cfunbincd tlu' military strength of a great 

fiiftn: with the euter]>rtt<e and tixeduess of piirpuee of au 

<iigucby residing in one city, »o England owes her graatneen 

^ W CKtubitiiiig, a» IloUand had done on a smaller M:ale 

fetffi', much of the free temper of the mediaeval city with the 

'Owph and broad basis of a nation. The cities of England 

W beta less distinguished than those of other lauds ; but 

ikaoifflihited her Iowdb more easily than any other country 

<Qd,at>d so gained in the long nin most from thcin. 

I The ctwtoin of primogeniture inclined the younger sons of 

^/Mf fiunilies to seek their own fortunes; and having uo 

I^Bll caste privileges they mixed readily with the common 

HOple. This fusion of different rank-s tended to make politics 

Uk«; while it warmed the vtiius of busineiis ad- 



32 



THE OBOWrn OF ECONOMIC FREEDOM. 



I'BU RSliciil- 
[ttOMtiMT 

[alwral 

rniD. 

Cm mgwi- 
ItadieUuu. 



__rtn<l« 
llcmm 

rof 

|ro4aciekiii 



vcDtun.- with the gi^nerous dftring and txiuuuitic lupiaitiiins 
of noble blood. Reaolate on the one hand in resistance to 
t^Tiuuiy, uud OD the other id submittioii to authority vheo il 
\& ju£titied by tbeir reasou, the EnKUsb have made mui; 
rvvolutiuu^; but nouc- without a dcfiuit<.- purp<wc. While 
refonniog the coiistitutio& they have abided by the law : the; 
ftlone, uniess we except the Dutch, have known how to wm- 
bioc order and freedom: they alone have iinit^ a thoroiij;ti 
reverence for the past with the power of living for the (Uturi 
rathtT ihfui in the- past. But the »treu^th urcli!u^i<.-t«:r whicli 
in latter times wade Euglaud the leader of maim torturing 
progress, showed, itself at first chiefly in politics, in war, mi 
ill ngrirultureL 

The English yeoman archer was the foreruaner oC tlu 
EogUfil) artiiau. Hu bad the saiue pride in the superionlf ' 
of his food and his physitjiie over those of his Contioenu! 
rivala ; he had the tuune itidoaiilable ptjrwverauee iu acquiiiaf 
perfect command over the ii»e of his hands, the same free 
iudepeudeuce and the same power of self-outrul and of mn^ 
to emergencies; the same habit of indulging his hunumn 
when the occasion wan fit, but, when a crisis arose, of pi^eteiT- 
iug discipline even in the face of hardship and misfortuue'. 

But the industrial (acuities of EngliinhmeD remaiiutl 
latent tor a long time. They hod not iuheriitHl much &>■ 
(luuiutouev with uor much care for tho comforts and luxuriei 
of cirillEatioD. In maniifacture-s of all kinds they lagged i 
bvhittd the Latiu cuuutries, Italy, Fiuuce and Bpain, at 
well as the free cdties of northern Europe. Gradually tite 
wealthier clasHes gut mmv baste for imported luxuries, ud. 
Kuglaud's trade slowly increased 

But there was fur a long lime no sign un the surface of her 
future coiumerce. That indeed is the product of her speiill 
circum»tauces as much as, if not more than of any natural 
bias of her people. They had not originally, and they haveiHA 
now, that special liking for dealing an<] biu-gaining, nor for the 

1 Fcir Uir pitrfumm at ttalUlind eoaipariMiu Um wrU.Udla jaauMX noil ta 
ranked with Uic midSe el>^w> of to^Uj. not irilli Ui* wliMiM: Eor IhoMilt' 
•Km ImiUit ult Ihui )i« •KTu ii-rjr hi Iu uiuuli«ri wLila thit fgnmi m>m gf Ikt 
pcnplc *crc TC17 tu bclov bltu. and <rcn, avcu 'ax tho pniaptrotu flftlrtk 
«aMi7. macb wane uS iu abnoM evur; rtvpeol U«ii Oust v« naw. 



LT saaan of bkolanp's kco>'ohic futubg. 



■c»alxrt«ct side of fiaaiicial business, which is fmnid auioDg 
the Jtws, tbe ItAUuns. the Creeks lujd the Annotiiaus; trade 
>iih them has always ukcti the fona of action rather than 
4 nmocDumng and .<ip<^]tative combination. Evon now 
ttt wbtJest tinaQcial speculation on th« London lijtock Ex- 
ikngt i* done ehiofly by those roecA which have inhoritod 
ikf fame aptitude fur tradijif; which the English havo for 

I Tits ifoalities which have oausod England in later tinics 
^Bvdiffureut cirvijinstaticeit to exploit* the world, and Ut make 
fBbuid aary thviii fur ulher counlneH, cauNt-d her even in 
beoiddlt; a^8 tu pioneer the modem organi»ition of agn- 
aihtrv. atid thtu to set the model after which musi. other 
■ideni businefis is being moulded She took the leaid in 
laitctiu^ labour dues int^i money payments, a change whidi 
BKfa increased tbe power of every une to steer hi» course in 
Ut aocording to his ovi'n free choie«. For gixid or for evil 
tteptople were set free tn exchange away ihoir rigliti; in the 
iud ind Uieir obligations to it. The relaxation of the houds 
rfeutom was haKtem-d aJike by the groat rise of real wages 
*Udi foUuwed the Bla<:k Death iu thti fuurteeuth cuntuiy; 
nd bv the great fall of real w^es which wa^; caused in the 
ulecnth century by the de]>rticiatiou of silver, the dobase- 
■ail (tf coin, the displacement of the ]>coplc from the land 
b tbe soke of ebeep farming, and the appropriation of the 
WMUM nf tbe monasteries to the purposes of court extni- 
•<Biilce. The movement was further extended by the growth 
i^lhc royal powt^r in the hands of tht Tiidore, which put an 
lo private war, and rcndoreil UHelcsa the btuuls of le- 
idni iho Iwinms and lftTid*.d g«^!ntry had kept togo- 
ing them Hniall hoUliugH U> eultivulu. The habit 
•^Wiog reaJ pniperty to the eldest eon, and distributing 
ftnoDil property annrug all the meinWrs uf the faiuIU\ on 
lb luw hand increased the »hte of laJided propertity*, and 
11 tin other narrowed the capital which the owners had 
it lurking it tlieniselvesi'. These causw* tended to esta-, 

' Mf Bu yi ««j» UMt tu tliR UiirUwiiUi cmilary the taJiic ut unble Intnl wu 
HrithMirf thceaplUI iwtntrwl to work 11; wmI lit- Ml««(>* Hut m Imi^ as Clw 
NBC il IU lud *•• Id \k» tutril of eulUi^tlug II liLmuU, Uie vblMt «on often 

3 



noox L 
cir. OL 



The*»|ii- 
tnllil or- 

<>t ll^CIlJ- 

l.urr t>io- 
necrnt Ibn 
wny tor 
Uiut nl 
waunltiy 
tiif*. 



34 



THE OKOn-TU OF ECONOHIC i-'BE&DUU. 



bli»h the relation of landloni and t^nnnt. in En^liuid ; while 
tho ftireign clfimnnri for English work «4i<l thv Etiglish dom&iici 
for foreign liu[urie« led, especially in the tnyteonth centtuy, 
to the concentration n( many holdings into lat^ge sh^ep-nmi 
worki-d by vapitaltst (anner». That is, then; was a great 
increase in the nnmb«r of &rinera who undortook the 
management and the risks of agriculture, supplying surae 
capital of their own, but borrowing the land for a definit* 
yearly paymt-ut, and hiring labour for wages : in like mauiur 
as, latpr on, the new onler of English humneti!i men undertook 
the management and the risks of manufacture, mppt^'iiig 
some capital of ihcir own but borromng the rest on interest 
and hiring labour for wages. Thus the English large hm. 
was the forerunner of the English factory, in th«; »amt! way a* 
English archery wae the forerunner of the skill of the Eiigliali 
artisan. |^| 

§ 2. Meanwhile the English charact.er was deepeni^i 
The natural grarity and intrepidity of the nluni mces th* 
had settled on the shores of England inclined them to ewr 
5****^'*" brace the doctrines of the Refonnatioii: and these niact^d on 
tton. their habits of life, and gave a tone to their industry*. U&s 

wats as it were, uithcrcd straight into the presence of bii 
Creator, with no human intermediary: life became iuWMs 
and full of owe; and now for the first time large nnirba* 
of rude and uncultured people yearned towards the mysteries 
of absolute spiritual freedom. The isolation of each pcwm"" 
religion** responsibility from that of his fellows, rightly niwlw- 
stood, was a neeesaaiy condition for the highent RpiritUAl 
progress*; but the notion was new to tho world, it was ban 
and naked, not yet overgrown with ple«aBant inatincta f.iM 
kindly natures exaggenited the sharpness nf outline wHci 
it must needs give to individualily, while the coarser nature* 



WHiiini?li 
ioflnoMvtl 
17 the 



OMd TVjioDB ilfrleni lor oliMifttliie n put iif hiii liuirl U) bU ynttngt:T brolliM* b 
VXcliujilpT for Uitn<^ of Uiuir 4A[>ilJit .St/ Centnn^.t ^ W&rk ajtj IVtiffrt. pp. M., 1.^ 
1 Thr Rtionatl'ma "itbs Uki >ffini]iitluii...ur Ii»UriJualily....ludin(liulilT t* 
uul tilt Kiuii of lilc, tint II In ui ooMUitial fart of lite in cvcrf rrKiou i4 oar aUtn 
an'l nur work, in oar wnrk tiir Uin ]iHrl &iiit tur Uie «hoI«. It I« tniu. Uum)^ It b 
not Uie «bolc tniUi, tlMt ve nii»t livp wiil ilio ■Joiie. bliuic wilh Ool" Cion 
\ViuiUi)tt'» K/mial J tpteu f/ ChniUiaitjf, f. 131. Coiii|i. kleo ilucd'a PA 
c/ Itiitt/ry, put IT. pocUom iii. eh. S. 



nrntrcNCK uf thb refobhation. 



U 



le aelf-ccowcioiis ant! egnfcjstic Their eagerness to give 
defiiut«ues8 aJid precistoa to tla-ir ruIigiouK cread 
gccnpicd their minds, und dixindincd t.hem to lighter 
Ihwgbtfl Aud lighter amusciuent-s. Whea occasiun arost! iimy 
mU take corobincd actiou, which wum ina<k> irr«:'»i!>tlble by 
^nsolQto will But thoy look tittle joy lq society; they 
immtd pablic amusements, and preferred the qiiictcr to- 
Inuioos of home life: and, it mu!?-t I>« confessed, some of 
Am look an attitude hoRtile to art'. 

The first growth of stn>ngt,h had theu somothing in it •■W'^'" 
Ibl nut ni«lc and in-niit.nnered; hut that .itrength was re- ih« 



Boot I. 
Ctt. III. 



HtrwiiKlh 

IIBCWHU'J' 



^aat<<l f^n* the next stage* upwards. ludividu&lium had 

to be purified and softenet! by much trihulatiou ; it had to Iti,^* V^' 

imtnt less wlf-assyrtive without. h*'comiiig weaker, before ^»'■illl U'l-'- 

Kw iwtitictA could grow up anmud it lu rtvivy in a higher 

ifiB what waa most beautiful and most soHd in the old cullec- 

lintenilencieR. TudividiuUUm governed by the temper of the 

Ubrm^d n^ligiou intensified family life, making it deeper 

Kid purer, and holier than it had ever been before. It ia true 

iix L'Ten the highest elements of our nature can be used 

nttf[ly, that an exchiBive devotion tu family ciirtis him evilx 

Win own. Nevertheless the &mily afFection.s of those races 

'^ hiiTe adopted the Reformed religion art tlu; richest and 

Wirat of earthly feelings: there never has been before any 

Mtcrial of texture at oncu mo ittrong oud aa fine, with which 

bbtili] up a Diible fabric of social life. 

HoUaiid Olid cither cuuutrieti sliared with England bho 
pttttjtdeul which was thus ripeneil by the spiritual upheaval 
Ite doeed the middle agua. But ^m mauy puints of view, 
*^ cpecially from that of the economist, England'ei experi- 
t>M VOTD the niotit instructive and the moitt thorough; and 

'1Wltm(ioa«»««««( Mnefonn* of ut ovatwl In wrionn }mt nurow mindH 
*H|ifa> aiptUnl kU ari ; and la iwchhq i>oclB)iiit« now rmll nt tbc Itoforawtltni 
■taiv faijvnd Ixttti Uw McU and Uie vlutu:' uutiuota uS iu*u. But it amjt be 
p<^riiL»lliLi the intauH feeHnp whiota woe eagoaAaal by ibe BetormtUoD 
im M wtaml art nan Unn tUr aiuUrltj Iiu tii]iir«d it. Tlwy b*v« ilo- 
*^M ■ iuntnr* bivI > aiule of Uuir ovii ; tail it tbrjr ham tod nun tn tliink 
li^^^rif Ite lM*al7of 11m wwka «l his «wii liuitU, tl]«T baio <»rtAiu]jr in. 
^M4bi*|a*M of appHiwitiog Uw b«antisa of ootnrc. It U no acBident tlikt 
kik«^ pi-t*^ mnt nwrt to ttudt in vLkb dai Ektgnatd rcUKiou 1>m V^- 

3—2 



•OOK t. 

cn. nt. 



The uvtiiu- 
■nk iiidn- 
MMtot (be 

Uuaua 

Tft* tntcn- 
■ilM 
tbtoiwli 
h«rkltniot- 
iiui twtageo 

UUMIUI 

fram tke 

ColltilMllll. 



Upvaa 

tana K bri 
amBM- 
inciits. luiil 

thru rvActdl 
ii!i her lu- 



wuTv t)*pical ttf all ihft rest En^laud Iwl thi- way in the 
modem pvolution of itnluRirv and CDterpriso by free luid nelf- 
(leteimining erierpj- and will. 

§ 3. The effects of the TUfomiatian on England's in<)uB- 
trial and cnnimt>rc-ial chararter were int.en(iified by the fncrt 
that many of thos* who had a*!opted the new HiK-trini-s li 
other couDtrii-jt sought on ber shores a safe aayhmi fVum reli- 
gious pcryertitinn. By a wtrt uf Diilural wlection, thiwu of 
lIk- FrcDoh ttiid FleiiiiDgs, and others whose character was 
most akin to the EngUiih, nod who had been led by tliot 
chmnct«T to (sturdy thorough Df(« of work in the innnufactur-^ 
ing arts, came to mtnglo with them, and In teach them lKa<ii 
arts lor which their character had nil atoitg Btted tb«ni*^ 
l>uring the fteventeenth and eighteenth contiiriw, the corn 
luid the upper classes remained more or less frivolous aofl 
licentious; but the middle class and some parte of the work- 
ing claw tende<l inereaaiugly t^i n severe view of life, wit! 
little d(.4ight in aniuHemeuIji that interrapted work, and with" 
a high standard as to those mnterial comforts which could 
be obtained only by nnrenutting, hard work. They strove 
produce things tliat hnd a Rolid and tasting utility, rathi] 
than those suited only for the purjinno of festivitit'H andf 
nHt«iita1ioii. The t«>mlency. when odc« it bad aet in, was 
promotod by the eUinate, for though not very severu it 
specially unuuitefl to the light<er aiiiusetnenttt; and the cloth- 
ing, houseroom and other requisite* for a comfortable axis 
enoe in it, arts of a Hjiepially expensive character. 

These weiv the condition* under which the modem in* 
dustrial life of England wag developed : Uie deoru for inat< 
comforts tends towanis a ceawpK-ss Ktrnining to extract 
every week the greatest amount uf work that can be got out 
of it. The 6rm reaohttion to submit every action to th< 
delibcroU; judgment of the reason tends to make every oi 
constantly aeik himnelf whether ho could not unprovc hii 
position by changing his huBiueas. or by ehauging hi.s method 
of doing it And, lastly, complete: political frcedoiu and 
lily enables every one to adjurt his coinluct as ho has decide 

1 Pr HaiilM bM ibuwn that tfac dcU wUdi Bttiibnl mm, Ut iInwi inui^tmaH 
i* gntbm UiMi libtnriMia Iwtu miii>u«m1< Uioncb Uidt Imvo alutyt ralfd it li^hlfJ 



niK OAIOIX OF LARQE BUillNlfSS UNU£ltTA£I.\aS, 



97 



: it id his interwit to do. and fearlessly to commit his 
I U)d his pruporty to now aiid distaut uuderlJikiuKs. 

lu sliurli. the aaatu csuims which Iibvu eiialilett England 
ad Iter colooios to set th(^ tioiie of inoderQ pulitics, have 
mk Uiein abo set the toue uf uKMluni buiiiuuiui. Thv Kanie 
lyJtiM which gave thorn [mlitical freedom gav« them aino 
I hi tmeriirisi-' iii iudustry uiid cuiunifrciL*'. 
! } 4. FiV(xk)Di i)f itidiLttry uud LtiU.-rpriiie luatbt everyone 
It <eelc that employiueut of bia lahoiir and capital in which 
UoB tmn thorn to bi^ advantagn, and the chief a<lvaatag<; 
liitk be ba» id vitiw ia geuemlly, though not always, the 
■MM of bifi owQ incuine. From Uiia reHidts a complex 
I iriMtriBl ot^gonuEUtioD, with uiucH suhtle division of labour. 
, Boue mrt of division of labour i» indcuil Kure to grow 
^ IB any civ-tlizatioii thai han httld together for a long 
ilife, butrevor primitive ita form. Even iu very backward 
«Niuri«8 wi- find highly BpvciflUzed Iradoa; but we do not 
fad the work within ea^-h trade so divtd<>d up that the plan- 
ing uul arrmiigcuient of the bu!tinot», itiri manogcTnent and 
iiftlisb^ are borne by one ml of [ivopie, ^vhile the manunl 
•nrk n^inired tot it is dune by hired labour. Thbi form of 
ivaoa of labour ifl at uuce oliaracttdristic of the modern 
>wU ganerally, and of the English race in pnrticuhir. It may 
k menly a passing plutM in iuaii'» developuic-ut; it may be 
Mupt away by the further growth of that tree enterprise 
flith hail called it iutu exitttenot}. But for the pretieut it 
■ttais uut for good or for evil as the chief fact in the form 
ofiDodeni cirili/ation, the kernel of the modern economic 
inUm 

Tie mcwt vital changes hitherto introduced into industrial 
fifctaitu' aT>>und this growth of business usdehtakers'. We 
Iwealmuiy wutx how the undertaker mode his appeoruice 



soatl. 

CU. IU. 



Kiiiiliiili 

(me enter ' 
pnw iialii 
rally lanib*') 
Uiw«nk> di' 
viMon at 
ItiKKtt. 



iHqiocii^ 
InUio 
ninLtor ol 
uiiili'r 
taliiii; aii<l 



'Xr nofananvM with itiMt form (Mx CmiHrit»«f HWil (umI n'ofru. eh. 1) 
IhBlkttMtJouvuBBtBtlcniiif ^moatitaewaoMijAzuMiKsnt tbe chW vaunu uf wliat 
• bM dutruterlidlc lii EiiKluid'a pollllMl lilit«r]r. Aixl rvtUiiilv hi? lUilttKiil 
atlriwiltal lii»tUatk«t not amtf war« caainton prodiwta d ibo bwdc lutiouikl 
^Mtar. !■! ako bftin actad aad nart«d prnvrfolly uu oiu luiulliir. 

*1lta l«nft. wbteh bM Uw KQlbniit? at AdAin Stnltli uid i> linliiliiBll5 ddhI 
•> (k Conljaait, wmw l«> Im tb> ImbL lo ciproai Vbuae nliiu tak» tli« riHkHKiiit 
■bHnpnwBt ol 6«Mtowi u tbalr ihw* lii tlio vnrh of oTKatitod btdnilijr. 



38 



THE GROWTJI Of ECONOMIC yREKDOM. 



at an early stage in England's agriciiltnre. The iiinner 
rowed land from his landloni. aud hired the neceasaij" labour. 
b«iog hiniscir rcBjionHiblc for the managrmenb and riakM of 
the busiuesa. The aeloirtioii of faniiora has not iitdei-d been 
governed hy pt;ri'octly fn-e cuinpi^tilitm, but has bixa re- 
stricted to a certain uxtent hy inheritance and by other in- 
fliieiictiis, which have oftL-u cuiiblhI the LrudcrKhip uf agncultui^ 
industry to fall into the hand* of people who have had no 
epucial talvuts for it. But Eiigloiid i» the only couotjry iu whicE 
any coa&idurable play has bc-en ^\en to natural aelectiou: fW 
o^cultimLl systojiis of thu Coutiuout have allowed the acd- 
deut of birth to determine the part which every man sliMiiJ 
take in cultivating land or controlling its cultivation. Tlic 
grcatisr energy and elasticity obtaint-d by oven this Darroff 
play of selection in England, has been miilicient to put Eitg* 
lieh agriculture in advance of all othorii, and has eaabljjd it 
to obtain n much larger prndure than is got by an eqiul 
ajiiouut uf labour from similar soils iu any other countrr af, 
Europe'. 
■niltlin But the natural selectioti of thi' fitlOKt tr> unditrt 

IrfijilduBire" <>'''K*"'^'^> '^"'^ '" iiinuagf has nnieh greater scope iu nianufiic 
ture. The tendency to the growth of undertakers in nmnu- 
faetiires had set in bofon> the gnuit development of Englnwl'* 
foruign trade; iu f&at tracer of it are to be found in tli£ 
-woollen manufacture in the fifteenth century'. But the 
opening up of Urge market* in hl'w countries gavuagrBit 
stimulus to the movement, both directly and through it* 
influence on the lucalimtioa of iuduslry. that is, the cooceii- 
trstion of particular branches of production in certain loca- 
lities. 



' In th<> 1att«r Iiittf nf tbo ilfhhintli crntiiTy. a(|kvntly. Uw tn 
io kh-riealinrc iii^vhI vmj (Ut. Imj^liMTiiiila (J aJl klnilH w«w 
■Iruiiiiug KU ourieil out im Bcluitiflc ]>9i»cliilni, tli« brMtUiv at fum i 
tcvulatinniMd by BakewoH'B pirjiiu ; Lurnipm dtircr. rje-gcvm, tix. em* i>^ 
gcaen] umi. uid viinlikil th« iiImi oT rtitiFkliiiiu luml liy liittiiiit It lii? (nllovU^ 
soperwKlod by Uut uf " alUininLiiitt liiulumilry," Tbi^e niiA iitliei cIiausm n** 
■t&iiU^ liii;nMUU«l Lliv <-ft|iltA] rwininxl tor the tulttTmtiMi of lui4 ; wlule tbttpa**^ 
lit (ijrtniii« lunilc iii tr&dir ineNAiUMl tbo QtimbM' of thoMwhowom fthlouidviffliC 
to purrfjWMJ Uirir wBy iiilij coiiiilrj wwipty by hnyin){ \trgr |iru|vrtio». AnH llnl* 
la every woy Uic uiuUuni cuuuucrdil aprit sivmhI in *giii'iiliii/c. 

* CfDup. OchiUiluiwHlUi A'ng/Idndi utirfUKltt^filieke Jiatiriairiuiig, )>. US. 




TW ncofdv of DMiSvnl bin sod wrnDdenig 
Ami AeK wtn man j tliiiigs caoli of wtuoh 
■ emij one v tvn phcMk. aad tbeoce tfistritiatcd mtrth um] 
«th, SMC aad vest, anr the whole of BaiOF«. But the 
ptDdactJMi vas kictliaed wid vhich Umrdled fiir. 
ialnjrs of Ugh ftvx abdeBwU bulk: the cfaeAptr 
aad bcMiTier guo<k wnv sapfdiod faj eadi dietnct for itarlC 
la tbe voliom t t of the aev worid, however, peoftle had aoi 
liwBTs tb« Wagore U> |mmdc maDU&ctuns ior thcmndwe: 
Md tbey wen «ftM not allowed to n»kt «vc« Umk whicli 
the; eould have made; Itv thon^ EngUuad's trcatoKntof her 
eolonie* was more hlienl than that of aay other «otmtt>-. she 
thoq^t thai th« expense which she incumil on their behalf 
JwBXified htT in oompelUng thorn to buy nearly all kindv of 
manubctunM bora beraett Thetv was also a largo demand 
fiir SUD|^ px"'" *" ^ f^d in India Mid to sax-age nm-s. 

them eaoa oB led to tho locolizatiuu of mucli of tho hcavtor 
manufitfturing woHc. In wurl: whit^ ivjuires the highly 
ttaiiwd fikil) and delicat« faocy of the opentiTo, otgani- 
acioQ is tiometimes of docomlan' impartanoe. But the power 
of orgaabiiig gt*»x nuniherv of people gives aa irreeiBtiblo 
advantage when then- is a (l«mand for wholn ship cargoos of 
goods of a few simple patterns. Thus localixation and tho 
gnxrth of chi? system of captioliftl uitdtTtukon wi'-n* twii 
parullel movenieQis, doe to the sarac gvoenU cauM*. aiiH each 
ufthvm pnmiotbg theadvwioo of ihi' othor. 

The factory system and the iiae of expeorive appliances 
in Quinufacturc, catnv ul a lalur Ktogc Thc-y uro cummunly 
sopposixl to be the ocigin of ihe power which undiirtukeia 
wield in Euglish industry; ond no doubt ihwy tucrmu^-d it. 
But it had lihown itsolf clearly before their influencic vas 
bit At thu timo of th« French Revolution then; wm not n 
very great deal of capital invested lu luachinoty whether 
driven by water or Btcom power: the fiictorii-s woru not 
lai^, and there were not many of them. Btil miu-ly all 
the textile work of the country* wns then done on a H^-Htvin of 
cootrnctx. This iudiiscry was contrc»ll(Hl by a ei»m|»ura- 
tivoly timall number of umlertakerH who set tlii<i[)B*'lvi<A 
to find out what, whcm and wbcn it was mu^i futvuit- 




TIm ■mlar- 

uJtvnal 

tntmimtT 

HHiMniidBK 
liidiMtrT: 

UlBI *«■ 

kUU llillM 

hy MBuM 
nuwUnL, 



40 



Tll£ GHOWTB OP ia»KOinC FRRBDOK. 



nncMEi. 
CB' lu. 



liut ip-^ 

undfT- 

ttik«Ri oA- 

I Ill-it i>«n 

irfirarluini; 
Mill It W- 

Atitdio 

Uuttlw 



tagiititis to buy and u> !tel), aiit] what thiugs it was Di<nt 
profi table to liave inadi?. The-}' thnn li-t nut coutmctj 
for making tiime things to a great number of |wuple 
scalcered ovt-r the cuuntrj'. The iinilertakers generally wi] 
plied tilt! raw material. an<l Buinetiint'ti oven the >utupl« 
implements that vera uwd ; those who took the oontracb 
yxccuUnl it by ihu labour of thtiiowlvws and their £amilieB 
and sometiincB but not always by that of a few assiirtonteu'^ 
As timt* wout tm, the progrestt of mecluuiical inveulioo caused 
the workerx to be gathenxi mnrv and monj into fat^mita in 
the Dcigfabourfaood ef water power; and when steam eanie 
to be mibetiituted for watt^r power, th«ti into larger facturiutt 
in great towtui. This lo^t movcmeul wsa not liable to be 
overlooked as the pnxeding moremeni wok by those who 
were tiot actually eugaj^d in the trade*. 

Thus at length general attention was called to the great 
change in the organization of indtuttry which had lung been 
going ou ; and it was tsccu that the system of amnll buidneaaes 
contpolled by the workers theniselvoB waa being displaced by 
the ej-stein of large buiiimtsseB coutrolled by the specialized 
ability of capitalist uudcTtakifrs. Tho change would have 
worked itself out very much aa it hus tlone, even if there 
had been nu factories: and it will go ou working itaelf out 



^ Tlie qnuter trf m csnturr iHwinnkiii iHUi ITAO m« iiii[inrr«iniBita folloir one 
ftinithtT in muinbcLim wen man) raiiiiUj Uuui in Bfrii^tuiv- luring tlwl 
^itid UiB tniupun uf Iimtj ipmda wu cluatieiieil by Biiiiillf^'t cui&Ih. IIm vm- 
UnrHaa Kf jin«ar hj Wall'* B(t!iini>aiigiiiv. aim) llut of irnn bf Cawt'u jinwHuiM «( 
inidiUiiit; kiut rolliiig, and \it Rarlnirk'ii mMliod uf mqvIUe^ It bf poa] In tieo 
of tku dtBTMial tliat luil udv tMcoinu n»tcv ; HaT||n«TM, Crom|iti>ti, ArkwriRU) 
Cartwri|[lit Mid uUim iiinuitait. <ir at leant tnadi; conttoinirnlly •enicmlilcv 
Uw qtonlns jmuiT' tlie mnle. the canUuu tuacliiuu. itut iLe |H>«tcf-iiiani ; 
Wadgvood pva ■ gnat uupvtnii to tbn imtlwy trail*' tliat van nIrMuly (rrnving 
npUl;; aiiil ttior* wara tnportaBt tnronUums In |iHiiUag froia i^liiubn, Ui 
bleaehuig hy eba^ati tgrnU, uiA iu otlier prucoxtM. A ttnltuu (a':U>Ty »«• 
for till' flnt tiuiii drii-rii dlrwUr bjr *(uwii-|K>*cr in \7^. tlie ImI Jvta of tiM 
pcrial. The bcKtniiiii^ nf tlw nineteenth flaiitiiry nair «l«aiN'«U|* anil alMUU 
IsttiUnit-iirvMM, aiiil tlie itie uf Ka> fur litthljlig luon*. JUilinjr luoanMtlaiu 
graiili; and iiluilORnpti? ramc » litUe Inter. Onr awii atfr. bai mmii iioDil 
llui>ravMunttB ntnl ii(«v nxiiKnuint in prinlncUori, (iniaiiiietil adioiic olilrh ar» tlioiw 
MlaUiig to »>" K*>'h"-t^""* "* "I*"'!' Uio lolepii-Miv, td* »l*rt/io tight. Wid tile (p*- 
vDcine; axl Ibc »cial rliaiinv* ahmiic trqni nuilcrial progivaa ar* la Kunf r<ci«cla 
uiimi n|iU Hint lliau uto'. But IIh- grunnilwnrk <■( llu) I'luacea Ihai harn 
hqipened •inoa ITtl «aa HittHj- laid In the iiiv«iitii»it of Uwi icata 17(0 to ITsa. 



atuMtt i 

.IKfliiM 

1 1. ..._ I 



.TRE MSB or THE FACrOftV SYSTEM. 



41 




t thft rptail dwtTibution of foroe by electric or other 
dbuiild caiue poi-t of thi.- work that is now (lone in 
he taken to iJih homua uf the workuni '. 
consequence of thit* change the cawes that 
lirieanuie the value of Ubuiir are Uikitig a new character. 
1}p It the eighteenth century maiitifacturing labour had he<en 
himl.a9 it Were, alwa^vs retail; in tliat o-utury i) began to 
.-d whutcsata l^p to that time itA price hud been iu 
either uomimdly fixed by custom, or determined 
jacidoDtit of bar^ainin^ in vonr' Kinull ii)urkct« : the 
ling had beeu 8ODietJni06 for the hiru of labt^ur, sorae- 
timoi for th« oakt uf it« products, the wurkiiiun having 
luiueif undertaken the risks of production. But since thuu 
iUpiicD has mere and more bccu determined by the circuin- 
tUttca wf eupply and demand over a laq^e area — a town, 
ay, or the whole world. 

e new onranizatioii of industry added vastly tt> the 
tfitiBDey of priMliii'tion ; for it went far towards securing 
nian*s labour should be devoted to jtiet the hii^heat 
of work which he was capable of performing well, and 
W wiM-k ^hoidd be ably directed and suppliwt with the 
Wit mechanical and other n.'^siiitanco that wealth and the 
bnledge of the age could atfurd. But it brought with it 
p»i( eriU. Which of these evil** wa.s unavoidable we cannot 
^ For jUBt when the chaiif^> was moving most quickly, 
Ei^Uad waa stricken by a combination of calamities almost 
wpmJleled in history. They were the lause of a gr«at 
P*rt— it in impossible to say of how great a part — of the 
v&TtDgs iluit are commonly asenbi>d to the Hudden aut- 
Itaik of unreMtrained conipetitjon- The kws of her great 
*4««wa« quickly followed by the great French war, which 
OK bur more than the total value of the accumiikt+.-d wealth 
■w li*dal itA commencenieut. Au iinprecedeuted xeriai of 

Psta made breatl fitartiilly <lear. And worse than all, 
of administration of the poor law was adopted which 
cd the iudependonee and vigour uf the people. 

'amBaU*/l'>n*lfn,M'Infht/h^lM>tji.Hk n.rh.Ri. CompUDftlaoMrOuroU 
II-TnUtfi vipumw iktiaioe of Um Fcctorr (jdoni ui Vo). a. of tli« V. S, Ctnmt 



GH. in. 

oltl unlur 
waHpiiifdlig 

fiotiefifdrUi 
ouunifM- 
Uirliijt 1b- 
boDT i*a* 
Milt nhol* 
•klo. 



The new ur- 

KUiiuiiiuii 

mcrvniwil 

Crmini-Unn, 
lit niu Ar- 

nilll[i»lliw[ 

hy gTt*t 
iTTtlii;in»n; 
ul wbicU 
wot* hoir- 
oierdne 
tooUior 



42 



THS nROWTH or ECONOMIC FHEEDOH. 



SOOX I. 

CR. ni. 



BODiv tntitu 

■ltG]lI|lts to 

mvivr cilil 
ordinanriNi 

Isbonr. 



Udiiod 

VI ill ill lliKir 
Uue, 



niifllU^ t-ar 
thff utoddn 
mn of rapid 

cliuiji[a. 



Tlic m nil 11- 

fiKtiuvrn 

Virtv 

chiollj 

strong icU- 
I tatAa niBTi, 
FiWho ntt 
•-sub tUe 

gOMtldi> 

of countaiti- 
tton. 



Tho first part of this crntury therefore saw free entw- 
pri^H c^tAblishing ittelf in P^nglmid tinder unfavounble 
cin:umstance^ itti evils being (>xa^gomtoJ, and ibi boncfiu 
buing mipprcsaed by external mififortiines. 

§ (J. The tvadv euatunw aud thf gihl rvgulotiuus by 
which tbtt weak had been defended in past times, wen; uii' 
suitable to tho new industry. lu ttoinu places they wen 
abandont'd by common consent: in others they wen- »ijc<x»- 
fully Dpheld for a time. But it was a fatal success ; for tb« 
new industry, incapable t>f flourishing under the old bonda, 
left those places for others where it eould be more firee'. 
Then the workore tunied to Oovemniunt for the euforcemeot 
of old lawB of Parliament prescribing the way in which the 
trade should bi_- carried on, and even for the renval of tha 
regulation of prices and wage* by justices of the peace. 

Thc«o eftbrts could not but fail. The old regulaticiw 
had been the oxpreswion of the sitrial, moral and economii; 
ideas of the time ; they had been ft?iL out rather than 
thou^fht out ; they were the ahnfwt instinctive result of th» 
cxpfrienee of gcnu>rations of men who had lived and tSsd 
uniler almost uni'hangwd eeonomin conditions. In the W 
age L'haugL-H eame so rapidly that there was no time for this. 
Each man hiul to do what was right in bis own eyes, vfitb 
but little guidance from the exporieiifL- of past times; those 
who endeavoured to cling to old traditions were ijuicUy 
!«npplant<;d. 

The new i-ace of undertakent consiatud chietly of tho« 
who hail niarlc their own fortunes, strong, ready, eoteqiriidii^ 
men: who, looking at the success obtmued by their o*B 
energies, were apt to as&umc that the poor aud the iM»k 
were to be blamed rather ibau to be ]>itieil for their iiii»- 
forluues. Impressed with the folly of those who tried W 
bolster tip economic arrangements which ihe stream of pro* 
gress ha<l undermined, they were apt to think that nothiflg 
more was wanted Uitja to make competition perfectly frep 
and to let the strongest have their way. They glorifiod 



■ Tliu Umilriicy v1 imliialrii.m to flii' **»j liMln pUcca vlun Umjt wcnww 
TC«iilaCfil h; tiiti gtitht wu at iiliL ataiiilin):, uiil tiw) iihirnn ib>df in tho tWrttml^ 
iwM.ur7, tboujcU it vraa Dioi cDEuimmtivtil? tMsbln. See Ocli«iik<iw«ki, I f. |h U 



^B THE BE< 

^^pTJAttJistn, and were in uu hurr}' tu tiiid a modem Rub- aooit. 
rtitnto for the social and industrial bonds wbich had kept ° *''" ' 
men logetKur in earlier iimi'& 

Ueonwhile misfortUDe had reduced the total net income of Tbn p-nuh 
tie people of England. In 1S20 a tenth of it waa absurlied uxm and 
B ptjing the mere interest on the Natimial Debt^ Tlie goods UrJ^d™'^ 
ibt were cheapened by the new invmitioiui were chiefly inann- Jij,"^,^ 
factored CMnmodities of which the working man y/a» but a »■««", 
■mI eoEUumer. As Kuglaud then hod almu!«t a monopoly of 
■un&ctiiTQB, he might indeed have got his food cheaply 
if maouiacturent had bvun allowed to change thuir warex 
Ireely for com grown abroa<l. But this was prohibited 
a Uk ialercitt« of tlie landlurdrt who ruled in Parliament. 
Tkt liboarer'a wages, 90 far as they were spent on ordinary 
bxl, were the equivalent of what his labour would produce 
A (be very poor soil which was forced inti> cultivation 
bdte out the iuHufficicnt Kuppliea ruLsud from the richer 
gmnda He hod to sell his labour in a market in which 
lb imm of supply and demand would have j^ivcn him a 
jnt pittance 6ven if they had worked freely. But he 
Utkot the full advantage of economic freedom; he had 
iodkicnt uuion with hia fellows; he had neither the know- 
KMp of the market, nor the power of holding out for a reserve 

^^fete, which the seller of commodities haa 

^^m It ii true, oh we iihall we prL>Hently. that thb want did 

Vniltnik« a very groat ditTerencc to his wagL>tt dirttctly ; fur 
tbt oompetitiun among t>mployent wsh ttuffieiently real in 
■ttn&eture, if not in ngricnltiire, to cause them to bid 
^iottoiie another for auy labourer whuBe wuge>i were less 
Uintke net Talue of what he pn)ducx>d. But the pressnni' tnA Ln- 
rfnot caused the workman to consent to excessive hours |,^thTit,',j 
tod mlitialthy condition* of work for himnelf and hit wife ^'J^"'" 
■dddldren. This kept down the efficiency of the working ''l^y?''' 
Pliulation, and therefore the ueb value of their work, and mwctMrn-; 
Atreftie their wages. The moral and physical misery and "* '**'™'' 
Ann of the factory population in the linit ipiarter of the 
ttVtnj is terrible to think of. 

Bat aftor thu yearly attempttt of the workiueu tu ruvivo Bulb* 
Uk old rules regulating industry had iiuled, there waa aoila4St?' 



THE BEQINNINO OF THE NINETEENTH CESTURY. 



43 



THE <iB»iVrta OP ECONOMIC FUBEDOU. 



tiflKIK 1. 

Uk. m. 

troui 
nttneli 

imuli- 



fWrfrM- 

do«u [ii il. 



rj uinlil 

.■nr, 
I VI V OMI. 

itliccviln 
utc 



mmmtXi 



longer any vnnh tu curtail t,ho fiwdom of entcrpriae. The 
Mifffritigfi '.f the Kngltsh people at their worst were uev«r 
com|]arul)le to ihosn which had been cauned by tlie waut 
of fre^Hlorii in Fnuico boiore iho R(.>vtiliitian ; and it was 
arj^t-d that, luul it not been for the Htnnigth which En^onU 
(lerivod ftom her new iitdiiijCnes, she would probably have 
succuu]bi><] tu u fumigu luilitai^' ilefipotixm, a» the free citim 
hod dune before her. Small as her population wwi she bc 
6un)e timed bort! almost aluue thu biir<teu of war agaiiuit a 
coaqueror in oontix>l of aeariy all the rasouioes of the 
ooutinuuC; and at other tiuiM aubitidized larger, but poorer 
countries in the sniiggle ngainst him. Rightly or wiungly, 
it wu thought at the time thuL Europe might have Inlten 
pennanently under the dominion of I'Vance. as she hod fallen 
iu an oitrlier age under that of Roue, had not tho &e« 
energy of English industries supplied the stnevrs of war 
against the comoioa foe. Little waa therefore heard to 
complaint against the excess of free enterprise, but much 
aguiuttt thai Uimtatiou of it which proveutcd EogUiihiutiii 
Irom obtaining food from abroad in return for the manu- 
factures which they cmdd now »u easily pruduix'. The tmdus 
tiuioua. wbich Were rapidly growing in strength and know- 
ledge, wen; bcgiuuiug to see the folly of attemptiDg to 
enforce the old niles by which government hod directed 
the «otirso of iiuluHtry ; and they hud as yet got no far 
reaching viows a^ to the regulation of tmde by their own 
aetion : their chief ouxii'iy wan to iuciwaae (heir own economic 
irecdom by the r<.-iiiovid of the laws against oombiuatious 
of workmen. 

§ 7. It has been loft for our own half-centiuy t« under* 
Ktuiid fully the exUmt of the evils which iiroHe from tlii« 
sudden and lioloot increase of economic firoedoui. Now &rst 
are we gettuig to iindenitiind the extent to which the 
capitalist employer, uutraintd to his new duties, was tempted 
to subordinate the wellbcing of his workpeople to hi» own 
desire for gain; uow fiwt are we learning the importancu 
of iniri»ting thnt the rieh have dnties iw well ai rights in 
their individual and in their oollectivo capacity; uow first 
is the ecoDomic problem of the new age showing itanlt to 



SUmERTNO CAUSRD BT TBB OBEAT FREXcn WAR. 



«S 



HOOK I. 

CM. in. 



~mm it n-BlIy m. THU is |iajil> dim to a wuli-r knuwledgc 

Bdagrowiug eamestneaa. Hut. however wiw and virtuwuB 

our graodfatbcni had bncn, ihej' could uot have sceu UiiugM 
■ «edo; for they were hurried lUoDg by urgent Decesuties 
ibJ tcniblt; disaeiter& 

In times uf pc:ac« no one ventures openly to rank money I'M* of 
ii«r high importaiioe iu comparison with human lives ; but i^Jitii 
Btb» crisis of an expooMvo war monoy oaii always be u«ed ^I,* *g|°(,1,t 
MS to save them. Mo general when hard pushed hesitates |V '"^ "' 
te«crifice iivGR in order to pmt<>ct his material, because the 
imet'A would bo likuly to cau&o rlit- lote of many men; 
VitBii nnv would openly dt^fend a saoritice of siAiMqth' lives 
faoder to save a few array stores iu unm of peace. And 
IbmTara lo judj^in^ thti action of unr forelathvni at the 
hgiaiidng of thie century we must alwa^'s remenibur ihal 
Btiicir time f.xery check to the pnxluction of wealth was 
BMjr Id cause a loM of life to EngU^h snldiers, aud iii- 
tnm i the rx^ of their lusiug that tiatiuuul liberty which 
w dearer than life. Even when tlie war was over, the 
feoodaon of wealth which it hod caused, though [lartially 
A^pUKdby an artificial inflation, of prices. ruudenKj it vury 
diScult for them to rate material wealth as low ».<« it should 
kt mtod in comparison with the health aud happiness aud 
^Ba t ioo of human bi^ingH. 

Bat we must judge ouraelves by a severer etandard For 
■t are not uow struggling for national uxisticncc ; aud our 
Xnmea have not been exhausted by great wars: on the 
wrlmy our powers of production have been imiueusc-Iy 
■neaed ; and, what is ac least as important, the repeat of 
I^Cwn Iaw» and the growth of steam communication have 
■■hied a laieoly uicrenscd populatitm to obtain sufficient A» 111"™"!- 
npplks of food on easy tenna Th» average money meome on Uw ■>■. 
tf 11r poopl*" ha."* moh? than doubled ; while Uir \inc(- of „^,,^cli- 
Aksi all important coinnioditiu.1 uxcwpt aniniul fuud ai'd ^ j^jjjj^** 
twMipom bas lallen bv one half nr even fiirther. It in true c^nni^ml 
•nt wen now, if wi?altli were difitribiit<:'d eiiually, the t<jlal i.verytyiir 
fndflrtion of tho country would only nufficu to pi-uvide ,,J^rf«ciit,i,. 
iniuiwiliiii and the more urgent coinforto for the people', and 



THE OBOVni OF GCONOHIC FIIBBDOIC 



BOOK 1. 

vm. in. 



The ti«w 
mtntiito 
oil tFctdnin 

inllMin- 
U(««ta<if 



TllH tf lo- 
ilTltllll UHt 
J I ri III lilt; 
)>H.'1ll Ull- 

jwnijiln HOW 
Ml rfwlilp 

•111 111 fir 

41V1-I1 r^iiir- 
Aiet for 
lliidi iiYil*. 



Aadwvkro 

tndiuily 

luavtiiK 



that a.1 thiiigs are. many have barely thi! iicrc«iari»« of life. 
But the nation has gritwii in wealth, m health, ui cducatiOD 
anti in morality ; and we are no tongor compellei] to sub- 
ordinate almnnb itvcrr other cunxidumtiuQ to tlio De«d of 
iucn^asiDg the total pnxhice of industry. 

It) particular during the prcsuut geucration this increased 
proepcrity has made ns rich and stroag enough t-o impose 
new K-strainta on free enterprise; eoate temporary material 
toss beiug submittal to for the sake of a higher aod greater 
ultimate gain. But these new restraints are diffpn>nt trom 
the o!<L They nre impoAod not as a means of cln.'ts domi- 
natioD ; bul with th(? purpose of dufendiug the weak, and 
especially women on^l children in mnttere in which they are 
not able to u»e the forces i>r(.-iiinpotition in their own defetme. 
The aim is to devise, delibemlely and promptly, remedies 
adapted to the quickly cbanging etrcumstauces of modcfrn 
induBtry; and thus to obtain the goo«l, without the e\-il, of 
the aid defenco of the weak that in other ages was gradually 
evolved by custom. 

Kv»n when iudusti^* ri^maijied almost onchauged in cha- 
racter for many generations together, custom was too slow 
in it8 growth and too blind to be able txi apply pressure 
only when pressure was beneficial: and in tliiu lat*:^ stage 
custom can do but Uttle good, and much harm. But by the 
aiil of the telegraph and the printing prejis, of represctitatire 
gnvemmeat and trade a»fiociations, it ia posable for the 
[leuptu to think out for thi.-niselve» the solution of their own 
pn>MvniA. Tht' growth of knowledge and self-reliance has 
given them that true soIf-controUing freedom, which enables 
them to impose of their own free will restraints on their 
own octiona; and the problems of collective production, 
collective ownership and collective consumption are entering 
on a new phase. 

Projects for great and sudden chtngca too now, as ever, 
furo-dooined to fail, and to cause reaction. We are still 



4 



in IND in abMil (3S iiao; i.e. il bu ri*ni ham »l>Oiit eio t« £1BS pfr (amily of 
IIto. tluir* »r* nnt a hw utimn'i lamilMi*, Ilia lutal earuiiigi ol wtucb c)«ev4 
£106, Ml Ibat OtKj voiitil lose b^ au vqoaJ iliatrfliutiuii at wcalUi^ but iiTea thojr 
halo Mut mors Umu U nqviral to euiinri a btaltlir au) mauy-aliM hit 



MODBIUf OOLLXCnVE TCKDBNCIKS. 



47 



it to move aafi'lj". if we move so fast that nur now 
flliut>r lift- altogether uutriiu otir iiuttincte. It ia true that 
httU) DAture can be modilied ; new idcalti, uevr upportuiiiticK 
■d Mw uKthods of Action may, as history- shuws, alter it 
wy much even in a few generations. Thie change in 
banan natnn? has perhaps never coTered so wide an area 
ind moved bo fant as in the pn?sent gonemtioiu But still 
il B a growth ukI thercfon,- gradiml ; aiwl changes of our 
Rtttl organization must wait on it, anil thurofore they nniHt 
kgndtial ton. 

But though they wait on it. they may always keep a little 
BKlTanco of it. promoting the growth i»f our higher Rociiil 
■tarc by giving it alwa}'8 »oiue new aiul liighi?r work to do, 
•mprBcttml ideal towards which to strive. Thiis gradually 
n may attAiu to an order of social life, in which the coinmuu 
(Mi uTCTTultui individual caprico. an complettily ad it did iu 
tbesrly ages before iudindunlism had Ik-pu developed. But 
WtlfiahneiQi then will be the otfapnng of delilx-rate will, 
Ikng;)! aided by instinct; individual freedom will then de* 
'>Aif itself in collective treedom, instead of, d^ was the 
OM ID the old times, individual slavery t« custom causing 
ittlkttire Ei1av<>ry and stagnation, broken only by the caprice 
tfdtspotism or the caprice of revolution. 

$8. Wc have bc»m looking at this movement fn>m the 
^lifh point o( view. But other nations are t,aking their 
'^tit io iL In America and other new countries, growth 
Iwbcen Ro rapi<I, and migration of the people so unooaring 
H t» Uader the careful thinking out of the problems of 
■nalocoDoray. But America faces new practical difficulties 
■till ntch intrepidity aad directness that she is already 
meitiBg with ICnglnnd the lc&dcry.hip in economic nffiiirB; 
Md rile will pmbably before long take the chief part in 
fwiHriiig tho way for the rest of the world. Already -nhe 
'■ffliM many of the most instructive instances of the latest 
«ni«iic tendencies of the age, such as the growing de- 
ttoacy of trade and industry, the development of specula- 
tin tod tmda combination in every form. 

Dd the Coatinent the power of obt^ning important re- 
free association In less than in English Kpeakiug 



noox I. 
en. lit. 

fiiniui at 

«illwllv- 
i«u wUivfa 
irtUbo 
liigbMtbui 
tbc «lil. bc- 

tamae tiu'J 

willl>e 
linaoil uu 

tluciidJiiHl 
indivLduol' 
ity. 



thro wli lit 
Ennfh Uelit 
oDoortalu 
uoonomio 

|irtkbl(iini>. 



48 THE GROWTH OF ECONOMIC EREEDOH. 

BOOK I. countries ; and in consequence there is less resource Emd less 
' ^•°^ - thoroughneas in dealing with industrial problems. But their 
treatment is not quite the same in any two nations : and 
there is something characteristic and instructive in the 
methods adopted by each of them ; particularly in relation to 
the sphere of governmental action. In this matter Germany 
is taking the lead. It has been a great gain to her that 
her manufacturing industries developed later than those of 
England ; and she has been able to profit by England's ex- 
perience and to avoid many of her mistakes'. 
wUleOer. In Germany an exceptionally large part of the best 
epxul t^- intellect in the nation seeks for employment under govera- 
eip^'**' ment, and there is probably no other government which 
meiiting in contains within itself so much trained ability of the highest 
■gement of order. On the other hand the energy, the originaUty and 
thf ROTwii^ the daring which make the best men of business in England 
S^iiiwie and America have not yet been fully developed in Germany ; 
while the German people have a great faculty of obedience. 
They are thus in strong contrast to the English whose 
strength of will makes them capable of thorough dis- 
cipline when they see the necessity for it, but who are not 
naturally docile. The control of industry by Government is 
seen in ita best and most attractive forms in Germany; 
and at the same time the special virtues of private industry, 
its vigour, its elasticity and its resource are not seen to their 
best advantage there. In consequence the problems of the 
economic functions of government have been studied iu 
Germany with greater care, and with a bias that may be 
a healthy corrective to the bias in the opposite direction of 
the English speaking countries. 

And Germany contains a larger number than any other 
country of the most cultivated members of that wonderful 
race who have been leaders of the world in intensity of 
religious feeling and in keenness of business speculation. 

1 List worked ont with iDOcb snggeBttveiiess the notion tlut a bkckw^rd iiktion 
must leuii ita Icbboiih not from tbe con(«mporiU7 condoct of more forward nations, 
bat front Uieir condact when tbey were in tbe lune Bt»t« in wbich it is now. Bnt, 
as Eiiies well ataows {PoUtitche QCkotiomie, ii. G}, the growth of trade and tbe 
improvement of tbe meana of conunnuication are making the developmenta of 
different nationa tend to aynchroniie. 



ECONOUIC HOVEHENTS IN QERHANT. 49 

Id every country, but especially in Germany, much of what book i. 
is most brilliant and suggestive in economic practice and in " "• "' ' 
economic thought is of Jewish origin. And in particular 
to Qerman Jews we owe the most daring speculations as to 
the conflict of interests between the individual and society, 
and as to their ultimate economic causes and their possible 
socialistic remedies. 

But we are trenching on the subject of the next chapter. 
In this and the previous chapter we have seen how recent is 
the growth of economic freedom, and how new is the sub- 
stance of the problem with which economic science has now 
to deal ; in the next chapter we have to inquire how the 
form of that problem has been fashioned by the progress of 
events and the personal peculiarities of great thinkers. 



CHAPTER IV. 



THB GROWTH OF BCONOHIC SCIENCE. 



BOOK I. 
CH. IV. 

Modem 

economic 

■dence 

oweti much 

toBndent 

thonght 

iiidiractly, 

batUttle 

direct!;. 



§ 1. We have seen how economic freedom has its roots 
in the past, but is in the main a product of quite recent 
times ; we have next to trace the parallel growth of economic 
science. The social conditions of the present day have been 
developed from early Aryan and Semitic institutions by the 
aid of Greek thought and Komau law ; but modem economic 
speculations have been very little under the direct influence 
of the theories of the ancients. Thinkers who had not learnt 
to break up the problems of physics, and work out one part of 
them at a time, were not likely to engage in the more difficult 
and less obvious task of breaking up social questions and 
dealing first with one order of difiGculties and then with 
another. The Greeks and Romans would not therefore have 
made very great progress in economics, had they given full 
attention to the study; but in fact they gave very little. 
And further, what they have written on economics is not 
only slight in comparison with their work in other branches 
of social and political philosophy, but also less applicable to 
the conditions of modem times. 

It is true that modem economics had its origin in 
common with other sciences at the time when the study 
of classic writers was reviving. But an industrial system 
which was based on slaveiy, a philosophy which regarded 
manufacture and commerce with contempt, had little that 
was congenial to the hardy burghers who were as proud 
of their handicrafts and their trade, as they were of their 
share in governing the State. These strong but uncultured 



I 



men might, have gained much from the philo«*nphic temper 
and the bnmd ititcraats of thi- great thinkoni of pii«l tiinuH. 
fiut, as it WAA, thej set themselves to work out their own 
prohlciiiH for tbeiDsolvas; aod raodcni uoouomiva hod at itit 
ungiii a certain rudeness and Hmitation of scope, and a bias 
towards regardiog wealth as on end latber than a Dtcaiis of 
man's life. 

In alt ag«s, but especially in th« early middle ages, 
stat««uncn and mcrchautti bad busiod tbom«vlvcs with en- 
deavdure to enrich the State by artificial rcgulationn of 
Indc The centre of their eone<>m had been to secure an 
ahandant xupply (if the preeiouH metalii, which they thought 
the best indicntion if not the chief cause of mnteriol pros- 
^jerilj whether of the individual or the nation'. Bnt the 
'Voyages of Vaeco de Onma and Columbus raiwd commercial 
queetioDs from a secondar)' to a dominating po&itiou among 
the nations of AVeslem Europt^ Thponed with reganl to 
the importance of the precious luetala and the beat nieaiiK 
<if obtaining supplies of them, became ihc- arbiters of public 
policy: they dictated peace and war. they determined 
alliances that issued in the riso and fall of iintjon^t and Ihey 

I^venied the migrutiuu of peoples over the face of the globe. 
Bt^ilations as t« trade in the preciou.1 mutulet were but 
■OTie group of a vast body of ordinances, which undertook 
to arrange for each individual what he should product! aiid 
how he should produce it, what he ehould earn and how 
he (thould spend his eaniingB. Tlie natural adliesivencaR 
of the Teutons hud given custom an exceptional strength 
in tbo early middle ages. And thin strength told on the 

I side of trade gilds, of local authorities and of national 
^vemmcnts when they sot theniBclvcs to cope with the 
reslless tendency to change tliat sprang directly or indirectly 



mica >»■ ' 
HtiivulKlvd 

brUie 

oT Ui« 
m Inn* And 
lli« tnilv- 
rvatcv vf 
Oif New 



Till) urlj 

uf trade. 



> HnrJi tUiclr liw hMti rl<'" hfltb In Rn|[bnil an(l Gorrnanf In niMlsitl 
••paitlfioia *» tA UiA nlaiiiMi u( iiuinv; (o natlon&l wciijth. On the vliok their ■>>* 
to b« nRvdeil avcooTiiiwI tlimuijli <raiil of ■ i^l<«r iiiii)vr»t4uiili»ii<if ihv tiun-U<>n» 
of VMBM^, mint tliao •• wniuti in cosMiqac^icG tit a lUlllxiraM iuj>iiiuiiliiiu tliat 
tlwlBOWmf th»net wfJiiiota nalioti rjulio effwtnl onlf byui uicrtMLir iit the 
■InrcB (d llie i itc i iiM melab lu b«r. But Uwro are pcrliaps no wiMrn on ni'iiKy 
Mot* Uw ^tamtli naitiiT; wba dU not oooaiJauaUjr niw nrcniuiutla boned ou Uiia 



4—2 



THE QROWTB OF KCOVOUIC SOIENCK. 



T1m> 

niervuitU> 
ihoory 
tanAffI to 

>t]>t 

tt«NUf 



from the Imde with thi* New World. lu France 
T^nuinic bias wa^ dirpct^d hy the Roman gcniiiA for ayHt>uii]. 
and patcruaj goveniinent reached itd zenith ; the trade regu- 
Intians of Colbert have become a pmvprh. IL vrao jitttt at- 
this time that economic theory first' took shape and the 
NO-caIlpd MrrcuntiK- sj-stum became prominonC. 

As yean* went on there Bet in a tendency towards econo- 
mic freedom, and thoee who were opposed to the new ideas 
claimed on their aide the authority of Ihu U<!rcantiligts of 
a post genoration. It is not therefore to be wondered at 
that the MercantilietB are commonly bolievcd to have pro- 
moted the state regnlatioo of trade an«l indualry. But 
ihey did not. The regulations and rostrictiona which 
are found in their nystenui belonged to the age ; tho 
changes whieh they set themselves to luiDg about were in 
the direction of the freedon) of enterpritie. In opposition 
to those who wished to prohibit absolutely the exportation 
of the precioDB metuk, they argued that it should be per- 
mitted in all cases in which the trade would in the long 
rtin bring more gold and silver into the country than it- 
took out'. 

* The teuilMicy to eiincnU) Ui« imiiiu-uum oif fuU and diver u ■leaacciU of 
DitkkDtl w««lth ma curlvd furtlicr hr tlwlr npimnniiU ihan I9 Umm. Uncb 
[QBtmnitir hul bcuD apeut in devialiiif iiUuh fur ]iii>T«aitliut Imlen Iroin tkMnc 
gtili u>A *i\rtt (ml nt tliM tfonatiy mi4 (or itiHntdas tkem (o bring ipM uti <U*cr 
In; (k graphic Bcwnmt of Ihrae plkiin is tptcn in Hiciiknl Jodm* cotliNTt«d worfc>). 
11nMrairiI*tiin)«{>ivMv(l wilL «)>«i-lal wcitilit mi tb«In41feConipaBj,wtilcfairuilel 
(o import kdikIe direct frtim luiUn, liat nliicii oatM bid 110 niukel tbere fur 
Enfllali i;uui1s; &ii<I htd tlieraftint to liaj vitli ailtiw or uol »1 >II. ita rivtl, 
tlie Lovftut Complin;, rmivod tlii: KDod< in Hoditarnuitaii iiurtu after Ibnr bail 
bono Uw aiMiPaf nf a long jtianttj hj lai iil. bat wn* alil* to pajr for ihmt hj Um 
mIb of Eaglivli gooda. Man htUu^ 011 WbnU ut tbo India C<iiii|«uy Mgued thai 
tli« BUiwrioT (voiiiirnj ol tiau arm r«ato» au<l diivct doalinit "onU «««Ue Ibeis to 
mtpjij Emctaeil'a deuiaads for Orifrolal jtoods aiiil yrt to aril Uielr rdti'iu ou tlio 
cutitinoit for mora ail«*r iJinn thuj bad (irigiitallx exported. He pctetad to 
ttio t>nnar* hnrrbuc tlirir mho! in ibe aarlb tn ex]<)>HaUciii nf an ItHmaaod 
tetnm iu liic uBit hnTTMt. Tha Etata whicJi abmUd praliibtt tbiMii fmin iliiing 
Uiiii, on Ibt fCTflimd tbat tbifj lr»mn1 tlie iitorli of t*mi iii tl>w tuuiitij, wunU, lt« 
anniod. b« no tnom (ogllafa tliau Um' Stelo which fortmd mtrdauita to Piport Hlrar 
ereii when tbo oltinate result nf thdr trade woolil briiijc mora Artr u)U> tba 
oouDtr; tlua Uir; Iiad urisiuaUy talteu out. A* Uw fanrwr* mrlcbrd tbo etmatrj 
wUk cnfmr*d io pnnninit (linir ««» ir^i. ■» ■xiuM the UMnHianta Ho, at all 
e*mta If Ibmy ver» MiniipaDcd to liririfc hark in thit Idiik niii aa niR*li fttrnr on tlip; 
look onL It i* ivolabU that he wooU bsw Imcb wilUng Io mat to tbo allror 
Aodiiv tt* own liar b"*^* ^1 U'** '■' *^i ■■«' T«B(ur* to aay to. Tbia |a a goad 



I 

I 



I 



THK MBBCANTII-R STSTESt 



68 



Mercantilifits indeed did not look beyond the iinme- noos i. 
inirpoiM] for which thc-y wtrc oonttudiag; they did uot ' ^"' " ' 
of eetabUehing a oew principle of social and political ""'iiiart-d 
£(«. But by nisiDg the qu'-stiou whether the State vrould iwit 
•il kcnelit by tUlowing the trader to manage his busines* as orwioiaic 
b Bked in one particular caw, they had unwittingly BtartRd '""^"^ 
^fcr tendency of thought ; ajid this moved on by impercep- 
Blsteps in th(> dirtjction of euuuotaic tn^odom, btiug afa»iKtt>d 
■• iu w»y by the dreiimstances of the time, no leas than 
^ tbe tutu* and temper of meu's uiiuds iu Western Europe. 
A little wan done here, and a little there in EngUind aitd 
RcUand, in Italy and Prance; the dtepK are difGcuU to trace. 
Il il Dut CMty to tell how much each writer owes to tho 
■IpiMioiM of others, nor huw far hu hiuiB^lf iut^nded the 
MHartioiu which we with our later knowledge read into his 
pnag hints. But we kiiuw that the hnjadening uioverneni 
iGdgd on till, in the latter half of the eightcpnth century. 
Ibf tune was ripe for the ductriue that the wi^U-betug of the 
aqununity almost alM-ays siitlbrs when the State attempts 
u oppisc it« own atliificial regulations to the "natural" 
uf every man to manage his own atfnirs in his own 



1 The Ant systematic attempt to Tonn an economic 
wi a broad basis was made in France about the 
ridite of the eighteenth century by a group of (?tat(:Hmen 
K>1 philo&ophets under the leadership of Que^nay, the noble- 
niatied phvBicinn to lyv»ui« XV'. The corner Mona of thuir 
piStj was obedience to Nature. 

In the two preceding centuries the Mercantilist writere 
Ui contiauiJIy appealed l« Xature ; each disputant claiming 
Un hia ftohome was more natural than that of othen, and 
ben of the eighteouth century, some of whom 
a gTpnt infliionco on economira, ware wont I<i find 
of right incoofonnity to Nature. In particular 

«f tlw n^ ill vihkh pnwUnl tuwik hxv* cumUuUt iiutKartcil Ui» 
owiikB *Mrh k«T« KMiilUfil in addition* to AMDonle wImw*. 

' I f*M hj daatiUou. t<j nhum ti goiuimllj ■nrihnit'd lbs nwiiy Sur Ly Kalurw 
*^wi w i u . Tbc BBtbor uf tliia asmj'n'u T«tT«cal« and in traar n«i|ji'cti> niiiclt 
*Brirf Ua ttee. fiat he mcdu to nii wutCinii hi nulliiil;. kiiil t cuiiint tgnm 
*U inaoi tn rcgndinc him m Ibe tnis Iciandra of inodem Politini Eouuouij. 



The 

Phyifio. 
mil 
llul*tc4 
th»i r«- 
■Irlctiou in 
■rtLficinl 
wiil lilmrij' 
1 1 iininnil ; 
Mill ibkl 
t.lte wflfntn 
uf Uie 

|wopU> 
■honldlM 
Uuflnt 
bim of iLa 
Kiateiiniaii. 



54 



TUB OROWTR OF BCOXOKtC SCIENCE. 



■OOB r. 

«>. IT, 



Loukc auticipatud much uf the wi>rks uf the Frcincb ecooo- 
mists in the general tone of tiis appeals to Nature, aud ia 
some iiuportant d«buls of his thooiy. But Quesuay and the 
other Prooch ecouoiuiats who vrorUod with liim, vero drawn 
to the pursuit of natural laws of social lil'e by several forces 
in addition to thoiic which were at work iu England. 

The luxury of the French court, and tho privilejfes of the 
upper clashes* which wore mining Franco, showed the worst 
sidu uf an arlitieial civilization, and made thoughlfVil men 
yearn ftv a rotura to a more natural state of society. The 
lawyers, among whom much of the host ineutal and moral 
strength of the country was to bo found, were full nf the Law 
of Nature which had been developed by the Stoic lawj'ers of 
thn lat^r Roman Empire, and as thf century' wore ou, the , 
seutiniL'ulal adiiiimtioii for the "natural" life of the American^ 
Indians which Rousseau had kindled into flame, began 
influence the eoouomistn. Bi'fore long they were calle<l ' 
Physiocrata or adherents of the rule of Nature*. 

Thoy were thu first to proclaim the doctrine of free trade 
as a broad principle of action*; and there was much in the^ 
tone and temper of their treatment of political aud social 
questions which was pniphelic of a lalvr agUi They fell, 
however inlo a confusion of thought which was common erei 
anwug scientific men iu their time, but which has heeaj 



1 It tut* Ihmu t^folhlcd tluit it) 1TS7. whLk the thirfj flkid in htxri Iiul 
(vurtcvntb |<ATt lit Ikiiir ii]Miiic»t. Miil ll>a tititiililj' |Mucl k tiiilb iil Uirin. Ui^ffTclit 
a*» at ltd pcuplc imiil ta-o-thiidi of iJikira. 

) C)im^. DuTwNiiguiilk'ii .'ln<-irii li^iai miJilUaina'a jlM(V«t/,(iir. Tli^namail 
nf |]ia l'hr«tiM'raU vnii ittrtvnl trom the title od OvpouiC tie Keiniinr'a nynarnilie 
eu ramiiHiuliaa Xaiurrllf rfii Gciirfr*4mf»l Itpl^t «ifiionr<i^Mi uh Ornrf ffumtin 
ftiUfata»d Id lT4ie. It 11M7 Im nuntiauMI tlial lJi«ir cnthiuiuiii fur KgHt^oIturv 
wid for Uic natnrdDou aud MmpUcotr of ronl life wm ta |iut dtiivoi) tnaa Ibeir 
fiioic maiAv*. 

' Tbrlr (aroiuile |iiira«e I.aiuex fain, laitm oUtr, b onniMnaljr ttu«p|iU«4 
now. /.aiiw: /air* iat-»n» tiiat uijntan *)ior1iI Ini allowwl M nial:« wlut llitiicii hi 
HkM. Mill •«b«lili<ti: Ihkt tH tndta ahaiikl ht open Id orer^badi'; Ui«t Gotcru-' 
nont nbanU nnl, tin llti' CollwrltttH inKli.U«l. |vwwrii>a to luttunfactonsv Ui» 
(wdiions .,i Ui«ir «lt>tl>. Laittft athr (01 /mrttr) tucttU Uutt partouii and 8<m4» 
■baaM In- kUoweil (it IntTrl Irwii' tniiu niiv iiM» Ui ■oolher Hid BI|Kidiillr (ixnii 
«ne iliHtrii't uf rranm Ut xiotbcr aiUiiiul iMiing ■abjert U) Udb anil Ijisoi and 
TOialiiniii raKnlAtlmt*. It nuf be noticed ihitC taivr^ lUUr wu fha tgOMl umA 
in Uie Uid'lto A^ait \r/ Uis M a rd iab to diy tbn Inuli from tho camlalMiiU >t . 
Tannuinwnt. 



THE Rt'LE OF NATURB. 



56 



ihcdoflt'ra liiujjatruj^k- from the physical sciencea T)iey 
d the ethical priuciple of coiiformitv to iiuturu, which 
fmcribes in the impemtive mood tertaiu laws of action, with 
IIUM causaI laws which scieoco discovers b}' interrogaling 
Kihire »Dd which are ejcpreased in the iudk-ative mood. For 
this Ukd other reasotui ih«ir work has very- little direct value. 
Bit ita indirect influence on the present position of economics 
hn b«a very great. For, 6nitly, the cloameBs and lof^cal 
MinEt«i)cy of their Argument^) have cau8ed them to cxerci^t, 
V » shaj) see presently, a great iiifliioneo on later thought. 
JW, secondly, the chief motive of their study was not, »w it 
M beoD with most of their predecefisors, to increase the 
(iches of roerch&iitH and fill the exoheiguers of Kiiign'; it 
via to diminish the »iiilT<>ring and degradation which was 
tHwd by exttvnie poverty. Tliey thus gave to economics 
iB ootleni aim of seeking after such knowledge as may 

>lo raise the quality of human life. 
' 1 8. The next great ntcp in advance, the greatest step 
lltt KOnomica hati ever taken, was the work, not of a 
riiaol but of an inihvidual Adiun Smith wax not indeed! 
Aeonly great EngUsh econoniiBt of his time. Shortly before 
k wnitc. important additions to economic theory had been 

it by Hume and Stewart, and excellent Btmiies of econo- 

I bct« had been published by Anderson aud Vouiig, But 
Una Smith's breadth was nulhcivnt to include all that wan 
bnt in all his contemporaries, B'rench and Etighsh; and 
Ihngb be undoubtedly borrowed much frora others yet the 
Me ODG comparca him vtith those who went bcfoi-e oud 
IboH who came after him, the more excellent does his genius 
iffear. 

EU redded a long time tn France in personal converse 
*ith the Phyniocrata; he made a careful study of the 
&igliih and Frenoh philoflophy of his time, and he got to 
benr the world practicaJly by wide travel and by intimate 
Muniiion «ith Scotch men of buKineis. To these advan- 
bgta he added uusurpaased powers of observation, judgment 

' BxM Ik ftiMdins Tuiban (writu^ in ITIT) liAd h> apologlm for liu ttit4irMl 
ka*Mll.Wim«f "** P*o|''*> ■rc«laC "■■* **> «iuioIii tham wu tlie only ws^to 
•«)4l]>*ki»K— P>un«* pajMBu, i«avro Uofaninc. jiuirre Ito^iianie. pmane Rd. 



HOOK I. 
CH. rr. 



Tlie; thnj 

tEKm In 

|l)ll1iUl- 

Ilirupk 
tone, 
Imt they 
U*ciKn«ttfJ 
iiil]iiiiui;«a 4 
it* Kbntrmet < 
tnwnn 11101. 



StniUiB 
seniak. 



66 



THE GBOWTH OF ECONOMIC SCEESCK. 




■001 L and reasoning. The result is that wherever he differs 
"^"^ his pretlecesBora, he is monf ntarly right thuu they; while-T 
thtn- is scarcely any ecunoinic truth now known of which 
he did not get noine gliiapse. But the area which he 
opuU(--<[ up was too vafil to be thoroughly surveyed by one 
man : and many trulha uf which at times he caugllt sight 
escaped from bis view at other times. It ia therefore possibl 
to quote hiji authority tu support of many errors. But 01 
careful examination, he ia always found to be working 
way towards the- tTuth\ 
Hegnwily He deveiopwl the Physi'jcratic doctrine of Kree 1\ta 
^'op" ^jj}, g(j much praotienl wi'tdom, and with tw much knowledg 
fiMtavJ*- ^^ *^^ actual condtiiiHDfi of business, aa to make it a great 
force in rcMil life ; and he is most widely known bnth here 
and abroad fur his argument, that Gorervment geueralljj 
does hann by interfering in tmdo*. M'hilc giving many ii 
stancex of the ways in which self-iuterusL may lead i 
individual trader to act injurioasly to the coniniiinity, 
Khnwe<l by nrgunieniM riebly illustrated by facts that ev 
whou Ooverumeut acted with the best intentions, it nearly 
always served the public wurtw than the enterprise of th^^ 
individual trader, however selfish he might happen to b^^^ 
So great an imjiremion did he make on the world by his 
defence of this doctrine that niottt German writers have it 
chiefly in view when ihey spi*ak l>{ Smithiitm»mus*. 




zM 



1 Furiuitaim. lit bail luit (|iiilD Hiit riil nf Ui« eimliwioij iimalciiil Ui Ua 
>wlwi)>i>n tfar Uk* iif (mnriniir' (cli>ii'V luiil tile etliiL-al |itara|>t nl nornlonnity 
n&lnM. "Katural" wtlli lilm it<ini»tlniM bwkim tint vliich Ow csUUn^ fi 
Mtml])' jmdBe» or tend tu fturioc*. >Mn#»niu tliU vliiab liiii own Immaii nunm 
nwhcB Um «rUi tlui Uiv; hIiuoM prvdiirn. In Ui« ■siun wdiy. be iwitipltMw 
leganb It lui the iwoviacc of Ui« MtmncURt (o uapi^xuid a MleacE, umI mi oUun lo 
Ht (orUi ■ )wrt vt tbr art of ninneriuueiU. Bnl tuuM m bin lansn«gi.i olUii b. 
wa Snd oD dowr otuilj Ui>: h« blnuwK humn pnttf wdl wtial Iw li aluul. 
WlMti Im fB nmklrvi dir cbumI lava, that in. lor lawi of mUuw in Die woileru ma 
ol Ibn l«rm, b« niuH (viontlfli* tni>thoct>t; amt wliftn ho nUim practical jirt-c^iitii he 
IpnaMaUj knows tbnt b« it oiilj ospraaMHf bii own \icwi> of irLal ini|^ to bi^ 
afvii «b«n 1m aaaim to riajni tlt« aiiUiuiitj ut imluxr tor Uuuii. 

* The anlMctan(<F fif tliU iianncc and «( nrvcm) iitbcri in tU( ainl tlM thiTC 
CeiUsviUK cbaiiter* b** almklx loen jniliUdml in llic antfaor'* iMOiinral lacun at 
CambriiitDaiiUioy*rfi>r>ii S'otitam t/ Bratemitm. 

* Tlw po|Ml«r lUM of Uii* Cem ia (H-muuijr |iii|dl«« not nnlj that AiUm 
Smith tlionght that Uia frr* x^f at todlndna] iiit«T««tB wo«U tU »•«« for Ui> 
jinUio w««l thaM sovemviniit inl«irf*«vuec eooU, bat furOi«r Ibat It alnNwl alvara 



ADAM BHtTH. 



S7 



r after all. this wa& not his chk-f work. HU chief work 



noon I. 

OB. IV. 



to ooubiDv aiid develop the HpeculatioiiH of his French °°' " 
ud English contemporaries and predeces«*)r« oa U> value. ''"?J** 
ffi* highest claim to have made eai epoch in thought is that *w to 
btwas the first to make a careJul and ecieutific inquiry intu ^•^nt br" 
tic mAnncr in which value lacosiiro* human motive'. JSftSwBJ^ 

Poesibly the full drift of what he was doing was not seen ^"'^^ • 
ij him, oertainlv it wns not p«rceiv&d by many of his fol- f-ir apply- 
batia But for all that, the best ecouoroic work whiirh Hi-icmiitc 
anwaftw the WealOi of Natiom is distinguished from that X!^;uay" 
tWA went before, by a clearer iofiight iuto the balancing <'*■ i^'B"^ 
■d wcighiiig. by inenns of iiionny, of the desire for tho poH- Mwmi 
■MO of a thing oca the one hand, and oii the other of all iiuiai<i>k. 
tbe r«riou8 eSbrtg and Keif-denials winch directly aiid in- 
<ii>«tly contribute lowardrt mnking it. Important a.s had 
Vts the steps that othent had taken in this dinM^tiuu, tha 
■dtmce made by him was so great that, he really npened out 
tb new point uf view, aud by mo doing tniidf an epoch. 
He led UB to eice how below the suriocc of a gn^ut part of 
luiinan acrion there are motives which can be measured ; and 
ttatktn- con be analyzed and subjected to the proec-sscs of 
laratific reasoiuDg. Hv thim pointed the way to applying 
•p(*iff«l and exact methods of study to an important port, of 
nnal pheuometta And the work which he himself did, 
^hngh uvl well arraiiged, is u purfuct model of method 
N iw as its aubetaace goea He saw that while economic 
riiflce most- be based on a study of tacts, the facts ore so 
woilJex. that they generally can t«ach nothing directly; 
<% miut be interpreted by careful reasoning and analysis'. 

b tin UmlI!; hMt mtjr. Bal tb* lMj£ng 0#Tmui •couotnUtti u« wdl 
■^tttal kr ■Uwlil.T iuM>l«d en Utc frtiqucol oiipcintioii tlut thi^iv in b«t««cii 
|MI* takti»(a mutl ilia iiubUo kinmI. See for iiiHt«tii-<i a loii^ liiit ul mdi 
«rfW« qwied lion Um tl'taltli o/ Ifatim* tij KhIm, Petituck* Qtkonomit, 

) Sh lalow Ch. vu 

■ flaM' mM o( Uio W'taSa of Xatioat, OttX it *> i* «o mn«li illiulnl«d with 
*■* tisU Ikal it anrt lain llw pntilk oUamtiui)." Tbin u uxacll.r n-Unt AAam 
^iAU; ki acUdn MtaBtiitMl lopmip MUTthlnji b^rloullvi) tmlnciinntirljliitory. 
B*4itolrf tic pruidii wera clitpUjr (ocU Uinl wore nitUiu BTBiyciiin'i kuowlrds^ 
■>to|hnH*L B»««t»l uul nnral. But be Jlattrftkul l>i« procli hj cnrloas ui<l 
Mnttn teeU ; be Uiaa Skvn tbom life mi4 faTc«, uid taaA» bi* ruhdcn fo«l 



S8 



THE CROWTH OP ECONOMIC SCIENCE. 



BOOK I. 

CK.n. 

ffacUwM 
■iiM (111 
f'h' Yowip, 
BcK'ti. 
MaltliiK 
ftnil i)tli»n>. 



ButtlM 

Sr*«t fomi- 
III RlUlil 

ftflrr Ailnia 

Uiat ul 
Bcntbam. 

He wajiBii 
ordBBt 



bnt liBil ail 

! Wtt»VM- 

LDlllr*«il 
Fotllmo- 
onritj. 



altlcir to 
Qtuitoiuan' 

rmtrirrliniii* 

autniliifiir 
wlilcli im 



§ 4. Non* of Adam Smith's contompomries and imm*- 
diate successors had a mind as broad and well balanced u 
his. But they did oxeelleiit wi>rk, each ginng himself up to 
aomv e\ass. of pmbkmu to which h(r was nttracu^i by the 
natural bent of his genius, or thi? spoeial cveota of tli« time 
in which he wrote. During tho rcmaiDdor of the eighteenth 
centurv the chief economic writings wen? historical mid 
deetriptive, and bore npoii the condition of thft working clams, 
eK[)ec-iftlly in the jigriciiltural districts. Arthur Young om- 
tinued the inimitable records of his toiir, Plden wrote abii- 
tory of the poor which has served hnth as a basis and a a 
mudL'l fur all succt'edlng hltttoriaus of industry; while Mai- 
thus showed by a careful investigation of history what were 
tin; forces which had as a matter ot' fact eontmlled the 
growth of popnlatiou in different countries ajid at tjifferait 
times. 

But on the whole tho most infinentiBl of the 
siicci^sKors of Adum Biuith wuj< Bi^iitham. He wrote litdsflfl 
eeoDomics hiniBclf. but he set the tone of the rising school of 
English economists at the beginning of the nineteenth ceo- 
tury. tie waa an uqcori promising hjgician and an ordttrt 
rcforiucr. He was cm vucmy of all artificial distinction! 
between different classes of men; he declared with emphtstf 
that any una man's happiness wfLs as important as any olfaer'i. 
and that the aim of all action should be to incT«aee th«nn 
total of happiuesH; he admitted that othur things being equal 
this sum total would be the greater, the more eipiaily wealth 
was distributed. Neverthulass so full was his mind of thf 
terror of the French revolution, and so great were tho enU 
which he attributed to the smalltist attack on "security" 
that, daring .-iiudj'st as he wns. he felt himself imd bf 
fostered in Ilia disciples an ahnost superstitious reverenca for 
the existing institutions of private property. 

There was yet another way In which he iuBuenced li* 
young economists around him. He was averse to all restric- 
tioDs and regulatimis for which no cL-ar ri-asuu could bft 
given, and his pitiluss demands that they should justify il 



that Ui>7 wero dedmi; witli pralilcm* (if tlie r««l votld, anil not 
stnctuniH. Vi'u nball liurc to return to till* milijccl in llic uoit cluLj'Icr. 



THE IKFLUESCE OP BeNTHAU. 



«sa0t4*ii«e received sapport from tho circiiin8tanc«« of tbo booki. 
•ge. As we have seeo, the metbods of English industry "*''* ' 
were not atationai^' in Adaut Smith's time: but since then '"8* 
changes had come very fast. As vru have soen, gilds and ooqid Im 
pufiiotus wid prejudice opfioHwi in vain tho tendency to Srpwirtoa 
change: if they fortified thetueelvL-s irresistibly in any |.u,u!^u( 
lowo, the wave of nniffress simplv avoided that town. It "/"nu. nml 
staittHl nvai indiistnes in new distnets wliere new metnods mwui of 
could be adopted without opposition ; ami left the town with j^,«Tiiiiiiii 
its obstmctire trade regulations to silent decay. England ^^ ^ 
lukd won her unique pwution in the world by her quick- c<»t«m. 
nesB in adapting herself to every new eeouoiuic niovement. 
It was by their adhcrvnce to old-fuxhioiiud ways that the 
natiouxofCentral Europe had been prevented from turning to 
actxiuut their great natural ntiourci^H. leaving England to bi-ur 
Ibeir share, as well as her own, of the expense-s of the war 
with Franco. The buHincsM men of Eiigluiul were inclined 
then to think that the influence of custom and sentiment in 
business afijurs wa^ harmful, tlmt in England at least it hod 
diminished, was diminishing and would soon vani»h away: 
ttud the dieeiplos of Bi-uthuui were not stow to n^iiclude tlukt 
Ihey need not concern themncIvoH much about cui'toni. It 
WS6 enough for thom to discuss the tendeudee of maa's 
action on the Buppositioa that every one was always on the 
alert to tiud out what course would best promote his owa 
interest, and was free and quick to follow it. 

There 'is then some justice in the charges frequently 
brought ngninst the English economitits of the beginning 
of this century, thai they neglected to inquire with sufficienl 
care whether a greater range might not be given to col- 
lective as opposed to indiWdual action in social and 
economic affaire ; that they exaggerated the strength of 
cunpetitiun and Itit mpidity of actiou: and there is some 
imd. though a very slight one, for the chargH that their 
jrk ij9 marred by a t^rtajn hardness of otillinc and even 
harshness of temper. These faulta were partly due to 
Benthaui's direct iuflueuce, partly to (he spirit of the age 
■if wliich he was an exponent. But they were partly aJso 
due to the fiurt that ccououiic stu<fy had again got a good 



60 



TBE OnOWTTl OF ECOSOMIC 9CI8KCE. 



AOOK 1. 
CB, IV. 

SBDlCgof 

of tlMm 

UlMl, but 

titajhaA ■ 
slrODB bisa 

rkiiidmn*- 
mixallmi 

(uiil ik'' 
dUL'tive 

Tlicir work 

Ivul K> bug 

trattciD ul 
luoavj. 




dsd into the hatuU of men wHorg strength lay ID 
action mthcr than iii philosophical thoujjht, 

§ 5. Slateanien niid merch&Dts again threw tbemKlvei 
into pmblems of uioney and foreign trade with extn more 
euergj' than they used to do when these questions were 
first started in the earlier period of the great ecunouuc 
chacigL* at thu eiiil of the Middle Ages. It might at fint 
Night seem probable that their cootoct with real life, tbini 
wide experience, and their vast knowledge of facta would 
have led them to take a wide survey of human nature isi 
to found their n-a*oiiiug» on a broad bajna. But the training 
of practical life often leads to a too rapid generaliiati on faai 
jienional experience. 

So long as they were well within their own 
their work was excellent. The theory of currency is juitt 
part of economic science in which but little harm is 
by leaving tmt of account all human motives except 
(leaire for wr-alth ; and the brilliant school of dednctiTe 
reasoning which Rivjudu' led was here on eatv ground A 
«nial! party — it is said that at one tirao there were not mow 
than a score of them — pnipniinded a theory which wius up- 
posed to the prejudices of the nj^e and which was roceivrd 
nitb ridicule. The Directors of the Bank of Rngland 
passed a resolution opposed to it: but time was on the fiidft< 




1 



3 Bb in uftoii iqHiliei] uf nn K riiprcnenUlive Ectiliiluioui : but Una ui )iM i 
lie wu iii>t. HiH vtriiitecmiittriiLilvi! criifiiiiilUj I* tLenuvk of Uie hiKlicatgoU* 
it> all nations. Unl tlial iinnlit^ b-f nhff^b. ho U di>tirij(tii*Iiod trtau rimI otbff 
««iputtfio ){i-iiiitiH is Kin avvrsiuii In imlacivoiiB iiikI Lu dcligbl ID ■WD'' 
r«a*ouiu£ii. AnJ thU i|a»litT b iliu, iioi Ui 1>U EutfUiili eilucntkiti, Mi ■* 
Bagdiul |>auita imt, to hi.i HtmHii^ nriiiin. Ktorly crtsy hruirb at the teM* 
ram bM IjhcI s>iuir< Bi^itdl kcnjuh lor ilfuiiii« ultli kbiitm.-tiuii». ui<l tmani'l 
UkoiD linve hail a biui UikmiIi tlic nbulroi^t cnJcuUticma euuuwhHl with thi tn^ 
of mniiD^v lUaliiig. uiirl iU nitxliirii ili>vrli>)itnviiU. Tlicro !• lui truly Esgluh Naii* 
mi*! w|jii»i^ uii-tlii-il nufuiblra lliat of IUhuJo; tiii jwiKer of tin Milliij. bi> 'V 
<r>il]i<iul vllp IbrmtKb iiiUicalv patUs (o nuw iukI uui!i]>Ktc<lrMii]UiLMini-TiaI«' 
Huriiunnl. Dili It is illIllL-nlt tivcu tor an BnRllnbniiui tn follow hia Incli; idJU* 
furvieu FrItii'H liaTe. n> a nilit. tnilul In ileleut llio rral drift oiid furpata dlPt 
nark. Efoii tbi- tbint u( tli^iii fmqiK-iilly niiilm-titlMi U\ rtliito lilm Vy ^■tiNlf^ 
jiroponUuiix vliirli ar> votmiiteitl vitU bii and ofUn tnen in*i>lT»4 ia ll>0- 
Fiu bl> M'\a cxplama buuHflf : lip iiv>t<r hIii'vtii wbat LJa puTpoao ia in inrti^ 
i\rM im emu byjiiilIiiMB aiul lljrii oii aiiutltcr. atu bow b>- properly oomMBiBf III* 
renilli at hl« ililtmiiit hyixitbuH'fl it in )KiBBiUD lo cover ■ krM rtMJd l * 
practlral ((nisatiiHu. 8m belaw Book n. Cb. L { a. 




ACinETEUESl^ OF ItlCARDO ANTl HIS FOLLOWERS, 



51 



IJM eGoooroiste : in a few jr"e«re the course of evento had boob i. 
|fmd that they were right, oud the Bank of England craac-d °°'" '' 
iHftnaer resolution fix>tn the minutes'. 

Th» «coiK>mist« next luldrenitcd themftelveii to the theoiy u>S 
af (brcign trade and cleared away many of thv flaws whit^ inde, 
Jbkm Smith had left in it. There ui no other {uirt of aeono- 
aio) except the theorj' of money, which so nearly falls within 
tke niigu (if the pure duduetivi- metliud. It is true that 

■ fall diwniision of a free trade policy mnst take aecount 
tfmuiy cousiderntions that are not strictly economic; hut 
OcH at ihaus, though important for agricultural countries, 
Bid e«pecially for new countries, had little bearing in 
An aw of England. And though the rautte of free trade 

■ otiier cniintries has been injured by the iiarrownesB of 
'iim of it« English adTOcatea, who have rt-fui^ed to take 
tammb of any elenienta of the problem which were not 
JBctically important Ui their own country aud their own 
tlK^ yet this very narrowness has given them pn^cision, 
Uiofity aud coofidenco; and htu been of Bcrvicc to them 
fethe immediate purposes of their struggle at honje. 

During all this time the study of economic facts was not "orm 
Sheeted in England, The work of Arthur Young. Eden, noJ«ct 
•d Anderson was carried on by Tooke. M'Culloch and "^''*'*" 
hnet And though it may he true that au undue pro- 
WMBce is given in their (mtings to thodo facts which 
*Ve of direct interest to merchauts and other capitalists, 
% tuM cannot be said of the admirable neriefl of Parlia- 
B«t8iy iniiuiriea into the condition of the working cUases, aud tn- 
•iadl were brought about by the influence of the economists, iw iLb 
I» IW, the public and private collections of statistics and "^[f^^'"" 
tW aeonomic histories that were produced in England at J^'* 
tie Mtd of the la«t century and the beginning of this, may 
inly be regatded as the origin of historical aud statistical 
wooniies. 



' ThiilastritMcif tbecoooDDuaU. cmbwUDd in UwgrvalUalUuiiBepartflf ItilO, 
Nlhi Ibn >Bb*Mif«ble Eiduiip* to an oxc«i«dTe Ifwuo at inrniiK-rUhlr liAiik 
■^ Til* ITwnhiHnn in vliirii Uin Bonk Diiwctorn dnolara Uiat Uin/Ara "uiialila 
bltotw aof Mili4 (iHaiUtioD tar twh a ftenUiueul ' ma pwiaefl Lb 18i9 tuA 
M«M in laST, 111* {iriMajda of tht BuUiun Ropart waa adopud In IHl'J by 
T^iliiMiiil. lull tlwjr hkd njecM it hj alus« m^ority in 1911. 



62 



THE OROWTU Of ECOKOHIC SCIENCE. 



BOOK I. 

OB. tr. 

Bat cImv 

knowledge 
of tlie com- 
pa»tl«« 
SMtliod. 



lort ihcm 
tu >r|:i]L> ai 

Uimuib nil 
in&Tikinft 

OUIW 

habiUM 
iniiul an 
ell 7 men. 



Kevertheless there was a certain narrownew 
work : it was truly hiHtortcaJ ; but for the greater [itrt^ 
wan not " coiiipurative." Huiot:-, Adam Smith, Arthur 
Young aTid otliere ha*l "been led hy their own InatiDctiTe 
genius and the exaiiipit? of Moutes([uieu occasionalljF to 
compare social facts of different ages and different countriet. 
and to tiraw lussoiis from the compariiMu. But no we 
had graspcil the notion of the comparative stud^ of hiatoij 
on a 9j»tc:ri»iic plan. In coosequeuce the writen of 
that time, able and eiamcst aa they were in their aeu^ 
fur the actual facts of lifL-, worked mthcr at haphuu^. 
Tlicy overlnokod whole groups of facts which we now pit it 
be of vital importance, and they often failed to Jinlkt the 
bost iiAc of thoAc wliich they colk-cied. And thif aarrov- 
noes vfas iutetiBified when they passed from the coll&ctio&of 
facts to general reaiiuniugs about them. 

§ 6. Partly for the sake of simplicity of 
Ricardo and his fullowors regarded man as so to 
cutistaiit (juautity, and gave themselves little trouble I 
study his variations. The people whom they knew 
intimately were city men ; and they sometimea took it 
granted that other Englishmen were ver^' much like 
whom they knew in the city. They were aware that 
inhabitaDta of other countries had peculiarities of thdrown: 
but they reganled such differences, when they thought d 
them at all, as superficial and sure Ui be removed a» mod 
as other nations had got to know that better way whk 
Euglishmen vjgtm ready to toach them. The «a.uie 
mind that led our lawyers to impoHe English civil Uwi 
the Hindoo!*, led our economists to work out their lh< 
on the tacit Buppoaition that the world was made up of tity 
men. And though thi^ did little harm so long as tlioy 
treating of money and foreign trwlc, it led them astraji 
to the relations between the diCTerout iuduHtrial tla 
It caused them to regard labour simply as a eoinnindity 
without thmwing themselves luto ttie point of view of th« 
workman ; without Bllowing for hin human passions, bi( 
iuHtincta and habit«, his sympathies and antipathies, fail 
class jealousies and class adhesiveness, his want of knowledge 




»f aty 

i 




TH£ NARROWNESS OP RICABDO AND HIB FOLLOWERS. 



68 



CIt.IV. 






aoil of the opport.iinitieB for free and vigorous action. They 
lluirefurc attribuK-d to the forces of supply and doinand a. 
much muro mechanical and regular actiun tbaii ibey actually 
liftvi- : aud laid down laws with rcgnid to pn>iit« and wages 
IhiLt did oDt really hold avua fur EugUuid in llietr own time*. 
But their most vital fault was that they did not nee how- 
UablL' to uhujige are the habiu and iuitlitutious of tiiduHtry. Th«r^^ 
In particular they did not see that the poverty of the poor^J,^),* 

is the chief cause of that weakness and ineBicieDcv which ''" '^''I 

• iIi>peniIeii'M 

are the causes of their poverty : thev hod not th«: faith that "' m*"'" 
econotmsts have m the possibihty of a vast improve- imliin 
lent in the coudition of the working c]u8S(.-a *itiiraH' 

Tbti perfectibility of man had indeed been asserted by 
tlie •odaliHtA Hut their viewH were hased on liltli^ historic ■> pnini "» 
and MauQtific study ; and were expressed with tui ex- Suctaiiiu 
travagance that moved the contempt of the biiHin&>is-like ""'''" " 
eoonotuuta of the age. The ooci&lists did not study the 
doctrines which they attacked ; and thcnt wan no difficulty 
in lihowiug that tbuy had not uuderetood the nature and 
efficiency of the existing economic orgaiuzutiuu of society. 
It u therefore not a matter for wonder that the ecouuoiUUi, 
flushed with their victories over a ect of much more Bolid 
thiukers, did not trouble themselvea to examino any of 
the doctrines of the »ocialigt», and least of all th«lr specula- 
tions as to human nature*. 

' A« ra(|ftnla wifm tiuav ytnt* evba »otae logicAl ttrran in llii^ niuirliuititiB 
Ibsy 4e4noeil trvm Ae'u «wn preniiaoa. Tlicw rrron wben trnccd tinck (o tliclr 
otlftB 4r« Qtlic more Ihau cordcH inml» of caprctrioB. But lliure wtvr miiDjr 
kaagmt on <■( Uic acjcurc. wlio liftd no rerpruuct! for It. sud iiwd it niinplj m 
m Uifino Inr k*«l>iii|I tli* (rnrklnE cUjwn iii llifilr ji]nc*. I'viLuiu uo ullinr 
rrcAl idiuol ul thiiiluni Uu e«cr siiIIiimmI tni much (rntn tbe n-iLf in wliirli 
tl> bkSigW* an H\4 panuitM. pnf8Mfal( to rtcnpllly tCMiomic doclrian^ reaXlj 
m«iitul«4 Ibotu •nlliMl llic fjonditUui* raquiml to mklu tlicta Iroti. iiim 
Uarliaeaa for iiwiiMw^ *1ip wivU Ulea iU!alf;ii«Kl lu cuiaroo cconoiuiii tinctiliim, 
vhm ilmrrililuc Uie ttmnt cJ rcndliis \iy whicli Hit pnpttvA h«rMlf . Mjm : '- In 
«id«t U) HTB my uerrni tram buiiis oviTwlicliiml li; Iho thoufibt of wlml I linil 
IMiUftak(>n, 1 r«M>lml uot to look Iwj-oiul tlw ilnpurliiK'tit aa irhtrli I mbs «d. 
p^pad." {Antati^rapkir, t. 19i). T«t abo did not iutrDd la to illHlioiiml, am is 
pfa*«l Ikij bpr lti*t miil«iuii(Ri nl » 'naipieirai tLal «o<iuuiiiic (IvotriuM mifbt bo 

* A pwtiol nxespluiu moat b« luule lor MalUius wbutie Ktniliini of pnpnlaiinn 
MUHOalari bj Rgdwin'* i«u)r. Itut bn ilid not propmlj beluuit to Ifao 
I mIimI mid Im wm nal a uwn u( biuduvu. Half n eontorr Ut«r Bulial 
yalJikl>«(L In opfHMltlon U> Iha lealkliata, an AxtriiTfljaikt doctriue to Uio affbot 



M 



THS GROWTH OF ECONUMIO HCICXCE. 



Dime I. 

CIII. If. 

WLuM 
iBflunon 

flTviluully 
■nadd it 
atdfblt. 



But xhe RocialiHts were dirii who had felt intensely, > 
wliti kni-'w sciiuelbiug about tlie hidduu springs uf buuM 
action of which the ecoDomiste took no account fiuried 
amuug their wild rhniistxlies there were shrewd obnervatiiHa 
and prej^nant siiggestious Troi a which jihilceophets and 
economiHtH had much to Icani. And gradiially their in- 
fluence began to tell. Comte's debts to them were Ttrij 
great; ami th(> nri:^!!* of John Ktiiart Mill's life, as he tell&^ 
in his autobiography, came to him from ivadiug them ^M 
§ 7. W^hcn wv cnmc later on to compare the uioden' 
Smajnt view of the- vital problem of distribution with that which 
E^'tT,""' prevailed at the bcsginning oF the ccntur>- wc shall tiiid thai 
•j-ouuiii of ^,y(.f J^^^ above all ch&u^e« in detail and all iniproveRiccm 
Wiitj-of in scientific accuracy of rciwoning, there is a fuiidamciibJ 
iLtituni change in treatment ; for whiltt the earlier economists argued 
as tbougli niau'a choruelcr and cBicieucy were to bo regwM ; 
as a fixefd quantity, modern economists keep ootutantly ifl 
mind the fact that it ia a product of the circuinsUiuet 
under which he has lived. This change in the point (rf 
view of economics is partly due to the foct that the chai^ 
in huiuaii nature during the last fifty years hnvc been W 
rapid aa to force thoRiBclvcH on th© attODtioo; partly it has 
been diit' to thii* iufluiineo uf individual writers, RoeialiMs and 
others; and il haa been promoted by a parallel change j 
other BciGuces. 
Uimitij At the beginning of this century the mathemal 

iiSuMiMtrf physical group of sciences were iu the ancnudant ; and 
^flP*"' !iclence«i, wi<Iely as ihey differ frtim one another, have this 
point in common, that thoir subject matter is cuustant ud 
unchanged in all cmintriex and in all ageit. The progns of 
science was familiar to men's uuiid^ but the developmeBt 
of the Hubject-mattor of science was strange to them. A* 
the Century wore on the biological group of sciences ware 
slowly milking way, ami people wen? getting clearer ideas M 
to the nature of organic growth. They were learning that 

Uwt Uifi tiBlurm] oTjcmiiiKtidii of ■ocleCj' audi^r Uie inflnotuw of ctuopttMlM b 
Um IwHuolonljlliftt cui l>t<[ir«<^liraU;(<ltw.-t*>il, liul vvnn that eon l>« UivoNtiMlIf 
eOBcdvid. Tli« tacidily of hia atTk «*tuwd tl* nurlM W hbrc graal racne; W 
Im XMlljr andnTBUKal ecuuuiaic BcioDoe, in Ota iiatni' uf which Im> pntfeMt^Js 
write. MMntdy better tbui Jid tb» tuOalliiU UieiniK>lTe«. 



JOmr HTTART MUX. 



65 



the 9ahje«t matter of a ticiuiicc paaw-s thmugh rliffercat booki. 
stages of <if-veli>pinent, tJie laws which apply to one Mage ' ^' ' * 
will seldum apply without moditicatioD to others i thu luwa of 
Ibe science must have a devel<»pment comssponding to that 
«f the tbiugis of whi<;li thuy trcut. The influuDw of Cllie Daw 
noUoD gradually spread to the Bcaenoes which relate to man ; 
tat) showtid it*elf ill the works of Goothe, Hegel, and Comt«, 
At last the spectitations of biology- mado a great stride 
(bnt'arcU : its disco%'erics fascinated the attention of the 
world a» those of physics had dono in oarlier years; and 
then* WHS a marked change in the t«>ne of tho moral and 
historical stieuees. Economica has shored iu tho goiiemi 
inovenicnt; and is getting to pay every year a greater 
tteiitiou to the pliability of huiiuin natun.', and to the 
hj iu which the character of man affects and Is afft-cted by 
the prevalent methodii of the production, distributiou and 
constimplion of wealth. The first important indication of the 
new movemuul was seeu in the lone of Juhu Stuart Mill'ti J^" L 
PrincipU* 0/ Political Koonomy*. MUl. 

Tlvt predumiuaul positioQ which that book )tuld in 
England for a long time, and the dogmatism of some of 
its ardent adinircra, have cuust-d uu inipatieut ruvolt 
aguiist it But meanwhile it has gone far towards forming 
the thonghta of nearly all the older living t«>iioini«ts in 
England : and what is perhaps even more important, it has 
iu a great meaBun; determined the attitude which they lake 



> iftinea \U\\ but MlimtMl his uni in tlia ulnitcBt tuiaU uf BenUikm ruiil 
Etk*nl'i. kibI liad ituplautail in his miiiil a i«al tin- nloamcn aiul dnBiiitrmcoH. 
kaA In IKW John MiD wrote An etu; 011 MutMiniic iDPttioil fii wbii<b \u> firogmM'il 
Im p«« fa)«r««ae4 iIiMiumi uf ontliuu In tlw ni>»triii.-ti<»ii i>f Ihe meinat:*. Hu 
laced BicMtlo'a tacit Hinuiiiitian tlial no tnotir* nl iii.-Linn osrcpt Lhe ilodn 
t<m wealtb ansd Ijo macli ooDiliUTOil \jy tbc ccuiiuuili'l ; lie licUl Uial It vtdh 
Atrngnfta* ao lunt; aa II waa iiril. iliatmcllr ■tali'd, hat Tin Idiihit; niul lia liaU 
IvtaiiiaRl a tivatlH vlijcb iliimlil ba dvlllicratslj ami ojimily IwiMut nn It. Bnt 
im 4x1 ttot ndii-iii Uie i>rii«au£_ A cbniijt<' lux) r<iiiii> i>vtu- liiit liwic of 
tluiaglil an! ot fading bofi>r« li<< )<alitiiili<"l in \»it^ liit ^rvi •K'niioinic wotfa. 
Uc Fall*4 it Hrineiplct c/ t'olitittJ Kciytuitajt lellh tiivit i>/ lirlr upjiiitalitmii 

la Sodal PiUtuojfkf; mu\ he inaiU in it no att<uii|il to imtrli vt bj » tifoA 
Um ihoau najonlBKa vhlch *»»ime Uinl luau't Hulu uiuU<v i* tbe pnr*iilt nt 
rnmUh tram tkam «U>t-b ilu nol. TI10 cbaiiHr in liiu attitnclo was a |Art nf tlic 
pwt ^liuiga* that iruK galtig on in Mie worlil aMUiul Uiio. thonitb ha m» tint 
Mif awar* of Ibeir inSiiciiiv on 1itina*Jf. 

M. 5 



66 



THE GBOWni 1>F ECONOUIC SCIEKCE. 



KnaK r. 
ea. IT. 

EasUiib 
rfloono- 



Cliancter- 

tnixloni 
work. 



with regard to social questions. Mill's foUowcra have 
tuitied his inovomnnt nn-a.y from the position taken 
the immediate followers of Ricardo; and the human at 
dUtiiigui»hod from th*^ mpchnniral element iti tAtnng a more 
and more prumiueut place in eooootnics. The new temper » 
shown alike in Jevons' subtle aualysis of utilitj, in CGft 
Leslie's hi8t*>rical inquiries and in other many-sided ori^nal 
work that has been done in England by Bagehot, Cui 
and uther write™ who are yet living. 

As we saw at the end of the last chapt<?r, England 
recently made great advances in wealth and iu knowl 
in temperance and in eanieHtnesL A higher notiou of 
social duty is spreading evei^-where. In FarliaiQeDt, in tit 1| 
prea.Hand in the pulpit, the itpirit of humanity speaks iMt 
di«tiuetly and more earnestly than it did. Mill aiul tile 
econotniatA who have followed him, have helped onwanb 
tluH general moyement, niid they in their turn havL- b«D 
helped onwards by it. Partly for this reason, partly in i 
consequonce of the modem growth of historical Kucntti ij 
their study of facts has been browler ami more philosoiiliit ;' 
It is tnie that the historical and Ktalistiual work of suM ; 
of the earlier economists has seldom if ever been 8Ur7)a.*9(<l , 
But much information which was beyond their reach, ii [I 
now accessible to everyone ; and economists who bs** '; 
neithijr McCuUoch's familiarity with practical businws, IW ' 
bis vast historical learning, arc enabled to get a view of tbe i 
relations of economic dcwtrine to the actual fact« of lift which 
ifl both broader and clearc'^r than his. In this they hare 
bet'n helped by the general improvement which has tftkeD i 
place in the methods of all sciences including that of hifiUIJ- < 

Thus in ever}' way economic rea.'(i>ning is now noR 
exact than it was : the promi^seB assumed in any i&qirii; I 
are stated with more rigid ]>reeision than formeriy. Bui 
this greater exactness of thought is jiartly destructive ■ 
its action ; it is showing that many of the older applicationa 
of geiiornl reasoning were invalid, because no core had been' 
token to think out all the aaiumptions that were iiaptied 
and to see whether they could fairly be made in the spedal 
cases under diMrussion. Thus many dogmas have ben 



UODEKN ECOKOHICR. 



87 



rhich iipjx'anjil In Im- simple imly because they nooc i. 
•m looeely express^'d. aud which served ua on arniuurj' ' ^''' " ' 
feitb which parti»in dUpiitatits, chieBy of the capitalist clasH, 
Wt e>|uipi>e(] thfinselvca fur the fray. Thia tloHtjuctive 
Vntk Qiight uppi-or at Rrst sight U> have dimiiiiflhed the 
Kline of processee of general reasoning in ecooi^mics : hut 
Mlly it ha» bad the o>ppu<5ite result. It has cleared the 
■pmi for newer and stronger machiuerj-, which is being 
Wt up with the aid of the manifold expt'rienco got in 
llheu«ful aud exact work of modem sciences ; in it« deal- 
•fa^ both with tho organic and inurgaiiie wurld. Gon(>raI 
Hwcoiiig in ecuuotiucs lias thiiR made more rapid prugrese, 
tod (stabltshed n firmer pnsition in this generation in which 
lit ii n]bj«*ct to much hoBtiW urilifism at every step, than 
rvWo it was at the height of itg popularity and it« authority 
I m wldoui challouged. 

So &r we have looked at recent progress fnnu the point 
Iff mw at England only : but progress in England ha.s been 
odjr one idde of a broader movement which ha^ extended 
Mwthe whole western wurld, 

$ &. English economists have had many ftitlnweni aud Frauch 
[Buymucs in foreign cuutiirit-iL The French school has had oubU. 
A cmtionons development from its own great thinkers in 
Ike eightirenth ccuturj-. and hns avoided iiiauy errors aud 
■nfiupoDS. particularly with regard to wageH, which have 
Iko commmi among the second rank of English economista 
ttcta the time of iSay downward!* it ha^ don^ a great deal of 
BRfiil work. In Couruot it has hod a coiiittructive thinker 
of the highest genius ; while Fourier, St Simon, Pn>udhoD 
ud Ltiiils Blanc have ma<le many of the nio^t valuable, as 
>cit u (oauy of the witdciit suggeHtionts of Sociulisnu 

Tbe Ajuerican school of economiata is somedmea under- tiid 
*wi to be the group of Protectioui«l« who follow Carey's ^^f."^ 
M ; bat Carey owes many of his best thoughts on Protection 
t« tbfi German List : he did however good scnice in dis- 
at the oarly settlers in a new country often avoid, 
of malaria and other caui^fl, the eniU which are 
ly the richest : aud on this he basi^l what he 
t WIS a refutation of the chief doctrinen of Malthua 

5—2 




»f>OB t. 
OB. IT. 



OHmiiLii 

■ccuto 

miiit*. 



88 THK QROWTH OF ECONOMIC SCIENCE. 

ami Hic-urdo. btil what wius in reality only ao Additim U 
them. Ab.siirbcil in curn.-tit jwlitics, the older Araeiicu 
school did little to extetKi the boundaries of ecoDomic sciwt 
But thei'c- aTe growing up in America new schools of Ihinkni. 
who arc studying the science for its own sake ; and there art 
many signs that America is on the wny to take the MBf 
loading position in economic thought, that she has tHreait 
taken in economic practice. 

Econ<itnic acionce is showing tagns of renewed rigour 
in two of its old homes, Holland and Italy, and the recent 
work of tliL' Austrian yconoinists is giving them a clsiin to 
be rt'giinlt'd upsirt fmm the Onrtnans, among whom thsT 
have often bc«Q clussvd. The most important oconomic 
work hciwpvpr that hxs been done on the Continent in thii 
et'utiiry i* that of Germany. Wlhi3e recognizing tlu- Icadeiship 
of Adam f^mith, the German economists hare been iirilaled 
more than any nthers by what they have regarded lut itt 
insular narruwness and .sulf-coiifidencc of the Kicurxlian School 
In particular they resented the way in which the Kaglisi 
advocak-s of frt't- trade tacitly aisninwl that a jimjMeiiTiou 
which hail been e.stablished with regard tu a niauufaciiinuj 
country, such as England was, conUl he carried over vfilhoirt 
liit raodificatinn to agricultural countries. The brilliant gmut 

and uati<Mial entliiitiifiHni of lAul overthrew thin priM^umpUoOt 
and .'<hi>wv(t that the Uicardtann had taken but ItttJe accuidrt 
of the indirect effects of free trudo. No gn^at harm might b» 
dontr in neglecting them so far as England wa« coaaenoi'i 
because there they wt-rv iii the main bencfiaaJ and thuaaddw 
to the strength of it« direct effects. But he ehuwt-d ttart 
in Ciermany and ^till more in America, many of its iiulintt 
offoet« wore evil ; and he contended that these evib o^l^ 
weighed its direct benefits. Many of his arguments wen 
invalid, but ifomc of them were not; and an the Engliih 
eeunomiKlti seurnfutly refusi>d them a patient discussion, able 
and public spirited men iiiiprossod by the force of ihdw 
which wcry sound, acquieHced in the use for the purp«B« 
of popular agitation of other argunumts which were M- 
Rcieutilic, but which appealed with greater forcu 1 
working classes. 



UlUUIAN l£CUKOUl»'nj. 



60 



AmBncan manu&ctuiV'rs adoptud List as thc'ir adv<>cato: 

iU)i> begiuniDf; of his lame as w<>II as of the systematic 

dncacir of jjroteeliimwt (lufiriia-s iu Ainuriea wha in th« 

circulation bf thviti of a popular treatitie which he 

'far tfc«m'. 

Tile 0«nnan» an; fniKl uf jcayliig that the Ph}'si(irrate and 

achoul of Aduiu ^mtth underrated the iuiportaiicu of 

liFe; that they tendu-d to socriBcQ it on the uiir 

: to a »clfisli iudiviijuuliaiu ami on the other lo a limp 

sthmpic CQstiio^tlitatiiiitii. Thry urge that List ditl 

; service iu stimulating a feeliog of patriotism, which i» 

generous Lliou that uf individiuiliKiii, unJ mure ntiinly 

definite thau that of coeinopoiitaiiisni. It mny be 

■bkd whether the cuKiuupulilaii ayuiptit]ik« uf the Phyaiu- 

laod of the KiigliHh economisto have been as etrong as 

tGcnoaiui think. But then.- 'i» tiuqucittiou that tlie recent 

itical history of (Jenuany has iullucuccsd thv tODO of her 

uDomibte in tho diructiou uf uatiooaliscu. Surruuiidod by 

i1 aud aggressive arraies Germany caii exist only by 

iUdof an ardcut national focling. (t is not therefore to 

) vwdered at that Germans have imiisted on and pcrhapK 

ua^cratud the fovt that altruistic feeling have a 

ntere limited ocopt' in th^ economic relationK between 

itiies than In those botvceu iDdividunls. 

But though national iu their HyrnpathiuH, the Oerman)i 

nobly ini«;mational in their studies. Tliey have taken 

lead in the "comparativo" study of economic as well 

inlgeDcraJ history. They have brought side by side the 



BOOK I. 

CB. tV. 



Till- 

OlTtlUULJi 

nUlma of 

untiuDBl- 

Lhiii ■j;;)iiiiiit 
tli<-nic of 

iiiili villa ol- 
fltia linn it 

Htlll CUMItO- 

IwlitmiiBtii 

oil lllr 

otlirr. 



Tlidf pPMrt 
wmk In Iho 
niiiit}' <iC 

wmii.Miili' 
lilnloiy lij 
Uiccom- 



' U ku ftlnAil; bum uliMrrcd tlial Lint ovprlualtn] Uiu IpdiIdhcj' of tnniUini 

kijon to nalw tba dvfelapiMiil nf dlHtirviit iialiinis flyiii'ljnjiiiM>. 

■pMiiitli f»i ■ I'lii |iiirifiirhnl in nwnj v»ym hinariL'tiliflc jivlKuumt: hat (i«miuiiii 

kkM4 itrrfy to liu ufpiBWnt llut ^ri-ty coiuibr ti*fl la gi-> tlirinigli t)>c Mnie 

4<|ti »{ JndufnvDl thai EkkIbimI hmi gimt tlir<rai|b, anil tl«t nhcliivl |>rutrctcil 

fcyinaffiiirtn nbcn »bv wivi in timniitifln ft^>in tlir n^ricitltunil to tlm ouuin- 

fcMMng lUgt. Ui- bwl « (itniiiiii^dcMlii; tnr tmlh; hia mrtlinl nu iti hannonf 

•tt fbc DNHparalive uKllial nf tuquiry wliirli in bt'in|[ |iiir>uf<l n illi viKotu' Uy kII 

di«« of ftuilKnta in Iri-rtnaiij. Iiiil n|ii.!L-iallj^ Ijy hi'r liittiirlaiH ntiil ln«jL>ri: wiil 

k lliMI aad bk£r<«t liiltnt«(« ul bin lliaiii|;lit bas txwii vert grf*t, Rlu IMlintt 

i/a .Vrv Sjtirmt of falititul fin,"inny alijiivrcHl in PIiiLut'tjiliin i» IH'JT, 'K'hile 

bn^r'a tnt itnpcrtuit «ark, lu> J'ri\nii'!i» of i'vUu<al Kcaaenia, irtn unl pul- 

UhI UU ISST— W. LiM'a Ihu nalioiale SgtlrtH fUr PntMtchttt OtlwurmU mw 

ttOlMa 



70 



THE GROWTH OF F/S)NOMlC SCIENCE. 



BOOS I. 

pnrntlvc 
uiuUiiid. 



Their 
work in 

prdlioiivic 
iliuorj iui4 



(tcrmui 
SociaUnii. 



social ami industrial phcnonK^nn of difFereut count 
of different ages; and have ao arranged tJiem tt 
throw light upon and interpret one aaother. The 
of n few members of this school is tairit<!d hy exaggerstianr 
and tvtsn by a narrow c*Hitompt for the reasonings of the 
Ricardian school, the drift and purpose of which tb^'liaw 
th'euistflvvs fHiIed lo uiidt-rstand : and this hail led to much 
bitter and dreary eoiitrovorsy. But with acaireely an Piocp- 
tioii, the leaders of tho ttchoo) have been (toe from tkis 
narrownega. It would be difficult to overrate the value nf 
the work which they and their fetlnw workers hi other cod 
tries have done in tracing and t^xplaiiiiug the history 
ecouoinic habits and itiMtitution& It is one of the 
achievements of our age ; ami an important addition to 
real wealth of the world. Jt has done more than alrao 
anything else to broaden our ideas, to increase o«r Ici 
ledgLi of ourselves, mid to help us to undenitand the cent 
plan, as it were, of the Divine govenjmeiit of the world. 

They have giv«n their chief attention to the his 
treatment of the science, and Ui its applieatrons to 
ronditinnH of German social and poHticjil life. eaix-ciaJly 
the economic duties of tht- Gcrnnui bureaurrary. But 
hy the brilliant genius of Hermann they have mode 
aud profound annlyses which add much to oiir knowle 
and they have gre-atly extended the boundaries of ecoao 
theory*. 

(temian thought has also givca an impetus to the UO 
of ftocialidni and the functions of the State. It u ftw 
Oernian writers, chiefly of Jewish origin, that the worid 
has received the greater pai-t of the moat thorough -going 
of wcent propositions for utilizing the property of the worid^ 
fur the beneBt of the community with but little refe: 



tfendl 



> 111 incli maitara, t\ir F-ngMiiii. thi? nrniinin niii] cverjr ntlicr iiBtlon 
tfaanunlvM mora than uibcn me iriUiuK uj ■lluir lliem. Thin >■ t'lutl; becuM 
«M!ll luitioll hu ib ovn Uit<:'llM'(iutl virtutv uid miuii'K Unun in tlin wt1UIi(I d 
(o(«(gn«r* ; wliilo it iIocK ticiL qTiite niidcriiUiiiil ilie irontjilA^uU wbleh otlMn mlb 
M Ui ltd flbortcoiniuKi. ll<il tliu rliii-t rviuun ii. Uml > urw iJo* I* gtmnSj el 
Unilunl KTuwUi; buil [> olhui worbeil out b; murv tlmn utic iinlioD >l llw HUt 
Ilmc: iwi'h I't lliuM- uiitiuJi!! is lilit'l; lo t'ldiiii il, kii<l Iliua Ui uiult-rmlliitatvj 
urlj^iislltj of tlii> <![livn>. 



OEBJUK BCUXOUISIH 



71 



lixiating iiicideitts of ttwnenthijx It is true tlia-t on noon i. 
ii)>(%ligal.i(tu thvir wurk turns out to he less original ' ^"' " ' 

mil as less prafotind than at first sight appears: but 
it derive gtvat power frum its tiialuctic ingi'muty, its 
bnlliant vtvle. and in .•xtme case-H from its wido-ro&chiug 
tkcaifb dUtorttMl historical loaniing. 

BeaitLus ihv revululiuuanr' Hoctalbit^, there u a large body 
J thiukL-n in Genuany whu are eettiuf^ iheinselvat to insist 
« the sicaQtinpiffi of the authority which the instltutiou of 
pdrate property iu its prcaonl form can derive from history; 
ud tu ui^ on briMwl i>cienti6c and philoi<opbic grounds 
I mo&sdcr&tiou of the rights of society as aguiust the 
iadivilual. The political and military iimtitutions of the a«niiuis 
(ienau pt^ople have recently increased their natural tou- K^yjiij, 
dncy Ut n^ly njore on (Juvvmment and less on individual |'*J'' """* 
aterpnae iban Enelishiuen do. And in all queabious bear- '""■> one 
«g on social refonna the huglixli and Ucruuui uatioue have 
W^^ieajra frvni one another. 

^^^^mid all thi* historical loaminj; aod rcformiug en-AmUaU 

PHhnn of the age in Germany and elsewhere there is wif^,, 

<liigef that a difficult but important port of the w&rk ^fJl^™^ 

,<f wmoioio science mav be ncclectod. The popularity of t>iore i* 

. . . . -' ,1 „ ilwutwUial 

Mimmua baa tended m eomc? meatJurB to the neglect oftbuMvcror 

wnribl mod rigorous reasoning. The growing prominence jionuii^ 

rf wlai has been called the biolo^eal view of the science ^[^ 

bt tended to throw the notions of oconomic law and "ciwitJflB 

tauuremunt into the background ; as though such notions ni^ im 

woe too hard aud rig^d to be applied to the living and ever " ** 

flailing ooonomic organism. But biology itself teaches 

■ that the vertebrate organisms are the most highly de- 

tdoped. The mudeni ecoaomic organinni in vertebra.to ; and 

n loraice which deals with it should not bo invertebrate. 

I abaild Iiave that delicacy and sensiti'veneRH of touch 

ihaeb are required for enabling it to adapt it«elf closely 

t llie real phenoTnena of the world ; but none the \es» must 

1 a 6nn backbone of exact reasoning. 



CHAPTER V. 



METHODS OF STUDV. 



Ill 



BMK I. 
CH. V. 

Canii«<l]J 
good 

irvlcoiii 

.Ji» unity 
Uiit ujiiW- 
UtsbucIkI 
]|ilu9i<mie- 
W-bnt 

Aw tbnt 
th««iii 

no iiDP 111 

•p«<dal 

ttaiimal 

cetitia 

eluMMof 

Uiiriu. 




§ I. Cohtb'S ductriiii: that all the ospuclK of Miciall 
are so closely connected that they <iiight to be stndilA, 
togfthur was oiiu sicj« of a great tnith, But uo 
attempt hfifi yet been made to construct a social 
that should do the »ame work for social Uf« as a 
which has been done for one aide of it by ccoDomic8> ; 
and ftiU of iinperft'otioiis as that la. Coinle and Her 
SpcnocT have niatle epochs In thought, by their broad airvi-jn 
and their suggeMive hints! but there is act much re&MOtt 
ever to fear that the whole world of man's actions is t* 
wide and too various to be analyzed and explained by on* 
intellectual eflort. Tht physieal w-iyntieti made slowprogictt 
Ro long ns the brilliant but impati»nt Qre4<k giMiius iniusted 
ill iu^arehiug after a single hasK for the explaimttou of dl 
ph}>tenl pheiininoiia: their rapid prngretw in the inudt^m agt 
is due to A breukuig up of bread problems into their com- 
poneut pnrta There is no dnubt an underlj'ing unity in 
all thy fureeK of nature, but whatever progress has bi-t-n inade 
towards discovering it, ha* depended on knowtedgi; obisiwd 
by pepiisleiit spcfcialized study uo lees than on ofcasiflMl 
broad flurveyiii of the field of naturi- as a whole. And niiultf 
patient detaiiwl work ia tt<]uired to supply the materia 
which may enable future iLge^ tv undeJVtand Wttcr than 
we c»u the force* that govern the develupmenl of the 
organ i>«iiL 

But even in the physical sciences, it is the duty of th(» 
who are giving their chief work to a liinitetl field, to keep up 



n 




COMTE's CRITICtMHS OF ECOVOHICS. 



78 



luid coDxtaut. wimapondcnoc with those whoare engaged wmx i, 

ei^hbouring ficUls : specialists who never look beyond "*' " ' 
t^ 4IWD domaiu arv upt to sec things cut of trae {)ro]>i>r- 
tku; much of the knowledge they get together 1^ of cum- 
pottTiily liltlt^ ui»c; thtiy work away ut thi.' dctailfl of old 
inbleiUB which have loet moat of their Bi^iificimce and 
btTc be«D etipplautcd by oew {|uestiou» rising out of new 
^Bt«of new; and they fail to gain that largo illiuninntion 
ihiih the progre«a of every science throws by crimpariwm 
Md tulogy on tho«e around it^ Cornte did good servicti 
Ibrtefon! by iosifitiDg that the solidarity of Hoeial phenomena 
aatf render the work of exclusive specialiste even more futile 
ilioaat thaii iu physical seieiiee. But. iis Mill iirge-n, Comtc 
Mly provtw what no thoughtful person would deny, that "a 
pnuD is not likely to be u good e^^unuiniiti who is uotliiiig 
4ta. Social phcnotneua acting auid reacting on one another, 
(key cannut rightly hi* understood apart: but this Uy no 
■cwt piYiveH that the material ami indiiKlrial phenomena 
tfavcietyare not themselves susceptible of useful geueraliza- 
tidukbut only that these generalizations must necessarily he 
nkuve u> a given form of civilization anci a given stage of 
Inat advancement'." 

Again, it is tnie that economints, like nil other students 
tftDod Bcicncv, are concerned with individuals chiefly as 
MubcTB uf the social organisni, Ah a cathedml is some- 
ihilgtnore (ban the »toacK uf which it is iiiude, as a per«ou 
■ KHDcthing more than a Rcries of thoughts and feelings, so 
ftt Eie of society is something more than the sum of the 
Smwf ita individual members. Neverlheless, the action of 
ftMrbolc is made up of that of its constituent parts; and in 
MS MODomic problema the best starting- point La to be 
tnni in th* motives that aflcct the individual, regarded not 
iriecd OS an isolated " atom " (t-o use a Qemiau phrase), but 
■»t member of 6omG particular trade or industrial group. 

A |K>«iition independent of ComtOH, biit in uoine reHpect* Ttw 
lillied to it, haa been taken by the historical scho<il of econo- ^,.^^| ^ 
is Gemuuiy. They have been scare ely less eager than ^^^m. 
to innst on the solidanty of social phenomena; and 
> Mill tht r«wr«, p. 89, 



74 



METHODS OF STIJJ>V. 



BOOK I. 

cni. V. 



EtMuuiuiv 
facta re- 
■luin Lo Iki 
coTotaU.r 
intorpNtcd 
liy reaaou. 



storae of them have sp.Ucn dispar&ji^ngly of economic thecfjf. 
But, on thii other hand, thej have carried the diriaioa of 
labour very far m gpecial studios of economic facte, ao that 
their wnrk has thrown H^ht on economic theory, ha£ broid^iiM 
it, has vf-ritiwi, iind has corrected it ; but, at the same time, 
has made use of ita aid nt almost every step '. 

g 2. For iiidfcd facte by themselves are sUeot, they t«ach 
nothing until tht-y are interpreted l>y renson. In «>me uf 
the ulumyutary experiments of a physical laboralort the 
infuPKnce may be so palpable, the demand for the exenaso u( 
reasouiug may be so slight., as almost to justify us in saring 
that the facts explain theuiBt>]veK, and give us direct in- 
formation. But without the aid of careful reasoniug, th«e 
is nothing to be learnt from tjcnnomic factd, becauw* no 
economic event or practical problem was ever exaietlr like 
any other Of course there may be a close resembljuice 
between t,wo simple iriciili-nt*: the tenn» of the lea.«e!i i)f two 
farms may be governed by nearly the same eauses: two 
refurencea of wa^cs qucstionH to Boards of Arbitration may 

' Mill » Miitr<iv#TNir witli Cfiruti< is ntill ft-orth otniljiii^. Comte'i upiiMm* 
bnvo rt-i^-entlj' bccit retUud wttli Kival furcc ami <1ck|ud>i«> by Dr lugnm: M 
lliv; Ao Dul aEiiicnr lu Liava olntkru MilVn poaitinti tlint Cinnle. Uuinf[li righmta 
lio nfflrHiEtili wna wFQiig wlii^ii lie ili'iilu'l. A Inii^ ■'ontrnviTrn)' lias bcMi wapil 
in Kiii-lnuil. (ImoBti; niiil inure reci-iitl; in AiiiPriL'a. m la the rigbl nuthrf 
o( wiiionik Hliiilf . Fi^ThaiiA iK-irly evurjoiie but Ihimi rliflil wlwa b* M 
iLffiTmrd lli&t fl ecrlftiii nwtltod i> uhuFhI; It liaa (iiincinUIjr baon ttia one brf 
ailaj>li<rl (iir tliiil [ihH 'li tlip tckiij-iiiiUiI work of c<cvii rimicii iu wliicb ho bu i*i 
the most liito'c-it. Dut liv Uom bwu wi-oiik iit diij>iii|( (luit <itliur luolLodi w* 
V^iul : Llie.v uiaj' Iw u|>|ilicii)ili> lur |ian'i"K» oLlittr Uiaai Uii»e of whic^ be bM 
beni cMvtI.v tlitiikiiiu- II«lt<rctiL-(? lin-i altenilj' Iteeu maile (Cb. Iv. § BllaUwfKt 
Umt tbt! liiiKlcm u( the Gc^tnnn hiiitoricnl Hrliaul nm otriifnl to avnid tb4> Pttnm 
gtivc^a iiito n'liii'b miine of (bi-ir followri Llto ilrifteil. It u»j be «*U W 
q,a(>lv Waciii-r> ohii worJn nUvii ik'fcudiiiK ScbiiiiWs't Uaiu&ttdt iftM 
Sclkiiiidler'H attack! : "Wn nil, iiivluitiiig I buliov Ibc cUM nprcMnlaUnli 
otlii'r iliBU Iw'LiiLulldr, of tliL* lilsti>rli'al m-]jou1 oI Natiiotjal £miioiuf . Um taaaim 
(rf liiii inovninniit, r1ii> miml iiiiili-mtiUKl nt Inniit MimiithiiiK oT Um buliirical MB- 
Mjitian — we nU, RusptiLT Kiid Kiiitu uul tiici-iititd. bold tbiit...Ugi> Idmtiljrtaf 

al KioiinDUC biHlory with naDiioinii^ tlmor; (Wirlh'fhaJ'if)r*rhK\lt imJ IFi4 
ichafirlhttinr) ja cot oulj- not rigbt, but i> a ronfuviipu atnl an oBtnoe ifllMl 
the cImuw ut lugio iu Iha ■^alutontoloity aiiil niochodolos}' ol Ibe acUan*'' 

Zfiltrhrijl JUrilif griam\nU SlaaWnitiUiiiiirhajt l{ii\mii.^.2'iii-~'&. 13dI SdUDOllS 
)Uiua«lf, Iu Lin cutitroivrvy wftl M«iij;er, lUa able le«dHi of AtMtriui rtacttell 
favour of tbn oldn mMlioda of nMiinmie ntnclica, ia carefnl to lUwIaiin aaota of Ifel 
citreme prctduiotia of liis fallaw«N, A ahort aiunmarj <>l thia «4itlrov«i7 la 
ltjv«u In ou article hy WaKUQr, jiait of wluoh U roprvduwil in tbo flral usaibat of 
the nmloii ifiittirrrhi Jauiiuit 0/ Krvnoinici. 



>» INTERPRETS RXPKRHtKCK 



75 



siilvitaiitiiUly the stone qu<>xtion. But there is no exact 
jtlttou even ou a small Kcale; and howevi;>r iii^arlv two 
OBseK correspond, we hav« ui ducldt- whether the diffrrciKw be- 
tweeo the two may he nvgWAt-d as jiractically ummpurtant: 
and tliU may u«t be ven,' easy even if the two casoH refer to 
the Hatiif |ilncc and timt;. 

And if we are dealing with the facts of rrnmte timen we 
mast allow for tho chiuigcjt that have menn while conie over 
the vrhulc- character of economic life: however closely a 
problem of to-day may resemble in ittt outward incideiit« 
another rcconl^^d in liist-ory, it i* probable that the economist 
will d«t^^ct a fundiimfutal differcuot- between their real 
cbamclerH. A careful im^uiry has to be made as to whether 
this IH edt before any valid argument can be dr&vb-n fnnn one 
caite to the other*. 

Obticrvation and the records of history tell iis that one 
event happened at the some time u another, or after it, 



Tliniui- 

irortliiiinui 
lit jnioid 
fade 
aridvnnn 
Armvn 
Truiu the 
■liaUut 
|Mal. 



I Tlina Ui* fnlro'lnrtlnn at tin- lydlem cif long InuM at Ilinil montij- mbU 
IB Xnrtli BrilatD wii fuUi>ir«il bj ■ urcMt ImproviiroiinL in agricnlttm). Mid 
Ib the ^nrnd Mindilinn of tliu jiooylu tbun. Bat Wom InfnTfiiit lliat il TCi 
Um ao^ "* cTcti Uip tbM eiiu« nf llif iinjir«Tvu>«iil wr niiut in>)aii« wbut otbor 
^^■*jp« vrcw (Jiluvf plM*# a1 tb«' BJinio Ibiio, itijil liaw mucti (if tb« iiuprorciut^ut 
U lo be rctored ta Mck of ttu-ui. Vi'u DiiiHt. for iuslatipe, ntlnw tor tUo rltticti 
«( changcl la tlie prlm-s td *i:iirnllnriil proatnns and or the catnblinliiJmit at 
(i*fl ocder iu tlia bnnirr imiTlncc^. To da thli rwinlm curt- mil ncienlido 
OtMuiAi tad U11 il Luk itttn diiue. no Irindwmtbjr uiti-reneii i-aii hit drawn u 
tft Ilia gca^nU Uxidi^iiy nf thu ijulriu o( lung I(«b«. Ami <<vcti wtai'ti It hu 
bMA i<im, wit MMiol argn* tmm tlili nipcrCanM to « fropimii] far n arilMa 
of lauc liMW in. Htj, Ifi<UiiiI iii'-H'. wiilioul ftUawuif l<ir illtfrnnff* in tbo 
cbwactcr <■< lw«l au'l worlil luurki'U fur vuj-luua Unda of ■eriL-nlliuul prodace. 
Cor iKvtmltle chaiice* In tlin pTmliii^tiDii ami conaiuiiption fit Kotil ati<] qtlvct. uid 
•a on. Tlia vfaoli.' lutrtonr of LauiI Tuuiirrn ii a most, jiiiportDiii atixl;: li\it lUitll 
eaMlaUf BDaIji«il and iiilatpr«l«d bjr Uui »iA i>t nri)iionilr lli«n>rj It llirowa no 
traatworthr tight oa Ui« qoMtlon nbat Ik Uje bi^al tunu of liiml limtirn ta ka 
nlntt«il niiw ■>> 'nr mimtry. Tbaa lu'imf ari^r Uinl aiiiri^ |>riiniliTL> wdcltBa 
HiMlly bvld (bcir Lanil in rnuuiicAi. |iriTali> ytiipin-tji in IrihI nitipil )» ku mmit.tm'al 
and tnuisitioiial liutitatiou. D^lien vriili t^iuiJ iruiiiiiluiiM wnlanil Uiat. hliu« 
ItinU l>Tvi>ort5 in laiul Iwtt axlanded it* range wltli ibu lUOKraea of ctvilixaLion, 
il la a mlliMaaiJ condition for fnrtlitr iiruKma. Sut Ui wruat from hiatnrj Lin 
tr*a ' j-jMiu on tiia aulijncl nxiuilva ttm rfftwta of Clie l'OIiiiiloii lioliliut! uf laiul 
» tba |««l to Im analjwil eo aa to diacovnr liofr far aacJi of tlinn in likoL]^ to tuH 
tlmm,y% m tlir aania w»j, how far lo ■>« miMlifleil \'j ebuagM In Ui« hablta. tba 
hi»alnlicc. Ilx wmIUl. and tiit aMial orRaubalkiii of tnankiiid. Hfatorical i«> 
^arrli nf Uu> kind R«iuipca all tlia reaonrcca ol (Kouimik aciouoe: and tboM 
pMt nwn wk> bj doing audi work vxtatul lii*' bcianilarioa of odcaiomlc wdaaea. 
aiaiiDt fplorUBt taa«kDawMB«tli«1r ohllsatianiUi itn aualvaM aadnaaooliili. 



76 



METHODS OP STTDV. 



BOOR I. 

on. V. 



Iiiiluctiuii 
■III] Ac- 
dueti'iD 

iitiituatl.T 

(topvElil oil 

one 
utoUiBr. 



but they eauiiot t^-ll ub whether the ftrat wan the ouse 
thp oecond. That cnn be done only by reasoD acting on i 
facts. Whuu it u) (^d Umt a cortaiu event in histoiy teai^ 
this or thut, it will bo foiind that nocaunt has ht-en takiiii 
only of (wme of Che coudilious which wfru pruseui whou tiw 
event happened ; the rest are tacitly, if not uncooHdciusly, | 
awtumt'd to bL- invlevaiit. This assiimptiou may be jiistifiible '■ 
in any particulnr case ; but it often tums out otherwiii^ 
Widur expenBUce, more careful imjiiirj', may show Uiat tl^H 
causes to which the event is attribut«d oould not hare 
produced it uuaided ; ]wrhap« even that they hiudeiwl the | 
event, which wa."* brought about in spite of them by other 
causes that have eacapt^d notice. 

To make such int^uiriea properly with regard to 
distiant eventfi in often impossible ; for we scldum 
roconlts of al! thu &,ct» that are wanted for the 
But it can be doue with regard to conteiiiiximry eVL-utd 
our own touritry. Whenever a cimchwioii is drawn 
them Ih&t meets with opposition, it has to stand a sort 
trial: rival explanations are offered, new facts are bi 
bo light : the old focb^ are tented aud rearnLiigixl, and 
Mmc casi;8 shown to support the oppiisito conchisioD 
that on behalf of which they were at lir«t itivoked. 
troversicB of this kind often raise a dust which obsc 
the truth ; but they serve a good purpose in showing U9 
much knowledge ftnd judgment are required to uft 
analyze economic facts, to balance them one against aDi 
to cheek them and to interprtt theui by one another. 

§ 3. Thus induction and deduction go luuid in haaii 
The progress of economic reasoring depends on the study <» 
eeouoniic fact**, and on the other hand, that study itself re' 
quires to be guided and directed by the sdenti6c knowled^ 
which is the outcome and abstract of a previous study of fact* 
Every new study of facts adds to our knowledge of the actiuj* 
of oconomic causes, it enables ua to form a b«>tter judgm^H 
as to the effects which any cjiuse is likely tn produce, whethc* 
acting singly or in combiuatiou with others: aud it put* u* 
in a better position to detect the hidden causes of resuK* 
which come under our notice. But the study to be service- 



>ucTioN jcuti:au.t dbprndbnt. 77 

! nnut be careftil and thorough, and nnist be 8o arranged uhok i. 
Ittonolatt! iheacduu fiist of oue caust; and then of another. __' 
ltd nuk« a. careful exatninatiH)n of each. The methods 
wniiitd for this work are not pwuliar to economics ; they 
IH tbt common pmperly of all science* AH the devices 
far the ili-tcovuiy of ihe rclatioua butwccii cause and effect 
tlocb are described in tfpatises on scientific method have to 
b( iu«l in tboir tuni by tlie t^ouomif*!. : there is not any 
OM method of invei>tigHtion which am properly be called 
tte nethod of economics; but erery method uiuttt be mude 
Mnteable in its proper place '. 

! > 1Im«I tvtrf anntilk iniuir? into tbe CMuiMtiaii twlncBii mom uid 
[Ad t» wftilo tip ei thno niUnwntM? prtmnHa iwuibliioil niiil appUtid h u 
kiMllle ifceU owlltioiu <i( Uiu (miUom. Tlie fimL U In tixiA thr HRiiiorjaiiiir) 
■rtiic to tnutr ttSntnt •wnMiiiiILnjtt. kud iu ill iinNlnirini' tlm i>niiic FfTnrl: 
■.tatlMUjitw. uluni «• iilwRrvB Uiat wi Uaig us liio grttilm |inrt <■[ i)io Eni^laii 
Uann' >•{«• luil to W apeul iii lircail. Ihi^ inarrlH);^ ntc mlwLfi fell KhMt 
kpnM of i>lM«t r>M>>'. Atuvtlii* U. kATuiff alrciidy iliscAriirvrt Ui<' irlTv^tii <■( all 
•■MB. aiT* «Ki at nark in anj" ewiv. t» miUracI tlivk« rroni tlip 1ot«l cSt^t, 
■1 tj du If <hnil M nriihMM to dctcnolnn Uic cSnci of tlin; one : ^r-. tvr iii- 
■mm, alMa w« aiulrsB tint oinm ut iuipurU over uxpurtit. kitrl. c1«lui'tii(K 
kd |Ml vhMi i> da« b> treii-lilii kiid ruiituilmitiin. Ui ttiv prulK) (ui Englinb 
InMMU M ianiga <Oniitri«a anil otlicr CMai<B. d»t«nnin« wlinthpi- Ili«TV i» 
I rngmitae irhkh Binrt b* »r«nuil«il for by oar Iwrronini' from ollwr vaiuttri«a. 
fvOllai'* A>Mj«.) Hi* Uilrl it Ibo dmplMti Irul CKUUi>t ufluii be Hiiplled, 
Hh lilW twn r««i» Mhirh rciHiinblr nnv ftnolhcr In cvtry rrspprt exc«|>l that 
1 ^m ■• iwwit (d oim of Ihem biii not lit Ihe oUi«r. T1i«u by holding IhR 
■M i| In Ui« tiitht. sa it iri'Tu. RgNiiiil «nu uintliBr. tlm nftitrl nt tbikt rauite 
k Mfc to rtaoil ant. TV twsl. p«rlup« Uic only i«rfcot. ilJn^trntiniiH ol tlii* 
, MU Mai mitlt In •DOniiailf* hai-w mfaTrtiiif lu Uiw pliyiucal \mwu nhtob tm 
■4Vrlb**ri>nM.tlw«gk Ibcr wv not, prop«r1? ■fcdiiuif economic Una, ncU 
' *flM> Iwiiiiu on Ibe fotilitj u( iaiiit: as Mlicii 8ir JrJiii Lanc!i il<:tt'niiiiit»i 
fc ■!■■•> of fuin7»nl mniinrr li]- cnlltTntin; If" luljai'i'iit jilnU of fbiilnr 
■Ahfnrtlj Um Mvin w«y. t^ierpt tlut uuty ati« uf tliotn ■■ luauuTnl. 




CllAPTER VI. 



ECONOMIC MOTIVES, 



BOoX L 
aa.n. 

Kcouoaaet 

Mgardman 




§ 1. It is Hometimew said thai economisLi 
"natural" or "normal." and m some seiiae evtrn right, that 
elumld Iw governed only by selfish motives; this opinion 
however be dismiwiud at oucc as a popular error, which finds 
no »up])ort in the teaching or practice of the best economisla. 
But again it is said that the acopt of txwiomics is limikd l" 
th« conitidcration nf thase actions which are governed by self- 
regarding, if not by avlfisH motives. Thi« view also bccim I* 
be mistaken; hut there Is so much authority for it tliat il 
rcquina t« be carefully i-xainiued. 

When the older econoniists spoke of the " eoonotnic bm" 
an govcntc-d by soliish, or by self-rogarding motives, tlwftf 
not exprcsB their moaning exactly. Mill truly obMifM 
that in economic phenomena " the- psychological law nuiiiJy 
concerned is the familiar one that a greater gain Is prcferrn 
to a smaller';" and argues that science gets a bettef bold 
in economic than in other social phenomena because if 
deals with motives that can bo compared quantitatively «J 
measured one against another. It is thiB notion of niea*ii* 
bility that he really takes &a the basis of hia work, thougk !>" 
does not emphasize it 

Tlie chief roaaoii why, though backward relatively * 
physical science, economics has been able to get in advacW 
of every other branch of social seicncy, in that it dealt maiol] 
with just that class of motives which are niea«iurable, Mii 
thcn>furu are specially amenable to trtmtmeut by scientifi 
machinery. Other branches of soeiat science deal only wii 
' r.t»!{c. Dwk VI. ci. II. I a. 



ARE NOT 



70 



AequRty of human motive: economics deals with quantity noos i. 
■ well w qiialjy. Wide a» are the interests of wHioh the ""' *'" 
Mootnubl takes a«coaiit when applying his rloctrine« to 
pndioe, the centre of h» wurk 'm a body of aystfiuatic 
mnaiitg u to the ciiiantities of measurable motive?, [-'or 
Ik putposs of tbu or tbul spc-cial illiiatralion he luay even 
Kglect all others: bat he miitit nuvL-r lose aighl of the real 
mus uf lire ; and these are all, with scarcely any iinjjortaiit 
OteptitmB, affecU-^ci more i>r Was by motives thai art; not 
Mtiuiable'. 



■ tm T* look ai ili« Individual, i>nt m n. " ptfchalogUal atom" Imt hn b 
■■1b of 1 ■octal group : ojiil uo iiittlioil ul nieuonnuviil ta of airy ftviiU whicli 

■ h4 laofwwltjr Bjijiliriilil* to lb" whiili' ii( thai (p-nuii. A.iiil, nhAtniiT itijiv 
k Ik* rtac in ibo fatorv, tbrrv in nt prcmuit oiilj' oiiv *iu.-b inrttjiid irkicli 
nb lor llilt: ibe nMtlnxL uaiuvl)', iif ntlitciiii; lo a oiimnuu iiiuii»urt- tliv 
l^(l ibat BBHI be eiTcni t» pmiitc t« imliicu tlipjii tu purfuriu or abaialii 
ta iHTomitm otftalB •ctmns. 'this llii^i in tlio m^iim- Id wliidi Die lenii 
■■■nUii MOtiv* b nnal bcm. JU mmu ■« ft iuuIitb iiaii ho uuiiuunul, an 
Ma ■ lait. *i l«*M, •>( tLi> mai-lnnery of eronamlp molliM U ftppLiciiblc t» 
& bib* mutM ill «likb w* live, i]u>n>i]>, as rciircuaitiDg general purcbasinff 
t^m, b M nacli iLc bent mMMini of iiii>tiri!B tluii no oUiw can oompeto irith il. 
B* Am U, Ki to qMTkk, an accji|«nt, ami |>«rba]>« on adcialnut Uiat li ool foiuiil in 
MhrvorUi Ihui aaT*. Wbau mt rant to Iriiltico a mui to ilo aiiytbliig (or im 
*|— »Uy oCer bim maaey. II it triii! tliat vm uiiyht appaa] tu hia (.■meranl}* 

■ MM «tf dnqr; kal tdU wmiM bn (aJlitie iuU acllmi Utont mntio'^ tliat am 
Alttf bi nHtriwv. latlitir Utau eup[>l^iiK iiaw ti»iili>nit. If u ii Ijhtm Iu hujijiIj n 

*>* n>u>« vd cencrallj wnwMcr Low nucli moae; nlU jiiat uut;* It worth his 
*tb In do It. Sginctimca InclMd the Kratitiiitc. or catocin. or liunour wUcL la 
Won a> ao induoruriit lu liiu acliuu umj B|>)ii.>ar aa a ul-w iiuiLiti?: iiu- 
taUr U It Aan b* cr7>lalliu>d ui pomr ilHltiilv <iiitwanl nia,nv(««ti)ilmi ; >■ tor 
hnaw in Uw ii)[Iit to make uie of tlittli't.k'raL'.B..or lo vruara ilaror a icarUr. 
I>i AahuHiMit ara coniparitlvfiy nr« and MtitiiPclfd with hnt (cw Irant- 
"il**: a»d tlw}' wonld niA mtvb oh a mcaaure ol tlii' oidiiiaiy uioliic* tlint 
P*n atfi la IIh acta ot cvurjr-ilay tifr. But jiuLitluttl Mirrlcug an: moiD 
hfMiUj Mwa/ilnl b; nkIi liontmra tliun iii luiy i)llii3' witj: bo >iii Iibvi- gnt 
■)• Aa balat at UB«iiirliti; Ibvai tiuL in iiiuDfy Itut tu lioiioiin. \Vh uy fur 
kaiae* that A* nsTtlaiK (<ir ilia bansflt «1 h\a pnrlf or nl tbs Statn. a* l]ii> <?>«« 
Kif bt. awa fktttj- paid tor I7 kui^Uioad ; while luiighUiixhd waa but aliabhf poj 
h >- be ha4 awnad a karuiHrIc;. 

Il k ftUa foariMo Umi then tna; bo world* lu wltidi nn one itvit lii-jirA ut 
Irtcdt prayailj' i« siatciial lliine*- O* WMltb ae [( is Kvuurally uuiluratouil ; liul 
WMii liMiHia mtP aivtxl out by ffiidiuitad lablnu u TF'Wnnli (or vvi<r7 nrtiiin 
hliidnkaCaraiiathar'i good. U tliaai! Imuuuri L-aii br (nuiHrerrD'i frotiiauci In 
Wk« trilkMil tlia iab.-rvaiit>aii nf atij otl«nial uutliaritj tln-j iihv xurve lo 
MHW« ika Mravth «t tuotiTaa juat bn ?an*cDUDt)jr Bud ei.avti j a" iivoiivy 4o«« 

^ib ta. la mek a worU there nay bo a tnatlM mi vcouoiuic ilieurjr ittj 
^dir lo Ifaa iireaant. cnn tlionsli tbnrr l>r Torjr lliiLo mention hi It ot 
■ksjal Ikta^i, and no hmdUoo al all of uiouaj. 

Il B^ muiii almoat M«lil la Inriirt ou Uila, hnt it ia not ao. Tax a. niialaadlng 



HO 



XCONOllIC MOTIVES. 



neox t. 

CH. VI. 

Tim motive 
at r>riiiii|[ 
inuuii)' iluuii 
not ex- 
diidc olbtrr 
cotmldcn- 
tioiu; 



nub u the 
IdMnn 

[lie nurk 
U»«U iukI 
tlielUBth:ct 
of power. 



§ S. liMiRH ihc motiro to & mail's aciion is spoke 
Ecii}jplifd by tht- money n*hk>h lie will (iam, it is not ni^anl 
that his mind i» closed to all other cou«idemtioHs save ihirn 
of gain. EvL'ii lilt- most purely bwdtiess rplations of life 
assiiiiie hont'sfy and good failh ; while matiy of l.h<>m take far 
grauled, if uot generosity, yet at least the ahsooce of n>«ui- 
rn^sH, The pride which every honest iiiau takos in acf|uittiiig 
himself w^U.ia a most Lmpurtaiil factor of economic «fficKDC!jr, 
and an important item in every caieful estimate of «ixk 
and wages. Again, roiicb of the work by which people wni 
their living in pleiymirable in it-self; and thori? is truth in tbe 
contention of the socialists that more of it might be nodeM 
Many find in biisinesH work, that seems at first sight unit- 
tractive, a distinct pleasure, which is jwirtly direct, and panlj 
arises from the gratifieat iun which the work affords w tli*!U_ 
instincts of rivalry and power. Just as a mce-horsp ot J 
atrhlfite Btraius cverj' nerve to got in mlvance of his 
petiturs, and delights in the strain ; ito a niauufactiinrr 
trader is often 8tLmulated much more by the hope uf < 
over his rivals than by the desire to add something to IlT 
fortune. The action of such motives as these must be sm<j 
carefully by economists; and the allowance required to' 
made for them will in some cases be so great as to alter ] 
ceptibly the general character of their reasonings'. 



ufodaliuii Imk i;ruwii up in pi-ujile's mltidR lietu-i'Mi iLat laouarouient of metlM 
wblrh i* thx cWuft tAtk iif cconnmic uicjibu, uiid nn I'ldnuvn rvigajA lot taUtni 
VmaJtla t-i tlw ui-jjlwl '•( iilhur kiiil liiglivr iiliinrtn i>l ilnHiri-. Tlin only (ujuiili* 
r«<|iurvil in n iiii>iuurv for wooutoir parpoac* aze Umt it ulioiitil W •oawll)^_ 
ili'lliilti' HUil trniiHr-KTablc. Itx Inkins a material (nnn b imctlOklljr (OBTi 
but i* ii»t (tupiitinl. 

> Uermiiti ec-iTinniiHl* liavp ilann gnoA mircini li.v iDviBliiiK on Uii* 
Mai«i>l(mtuitiB, bnl tbi'^ tteia In lie miitAkan in n]i>|>Diii[i^ thnt it via ate 
\>j tin: oRvt ]ii)|;li»li couixxniatH. It in mi KiikIikIi UhIhI Ii> Irm* mndi 
iiu[i]ilicil hy llic cummoD kuum) of tin.' rcailvr; in tlus i-aav reticence bw < 
uuricil lim tax. uiLiI line Ifil Ui (rtniixiriL ini*iii)ilrnitnii>llii|[« •! timiir m >nD V 
uWiMiiI. Thiiii iirimiiiiFiiMt \ms bci^ti kivfii tv Mill'i aUli-tiioiil. Llial "Pulilw 
Rfnn.oTiij' fotiiiiilc-n iiiaii ah uft-upM saMj hi ai'i]uiring aiirl coiituminit «B*ltli" 
\Kttiiti4. p. IMK, ■lulKgnin, }.ug\r.. Bfc. VI. Ch. ix.f 3). BiU il in tursollcn ttitlh* 
jfOMi Oil to Hf , "Tbtrro t» p«rli»iiH, iiti Hi'tlon of n tiiHii'a Ufa in vliicb li« i* tMillUt 

auilcT lli« iuiiuiitktc nor oiidui l3ic ivutoU: iiifluciico of >ii; iiupiUiio bet tbe M* 
'Unirr of woaIiJi :" iikI it is (urg-^atcii tliat Uia truBiuiviit uf ecuuumic %n»riiiim ' 
t«oh cotiNlutt aircomit of uiau; luutiiuit btii»li1«tt ttie iImItt Tot woftllfa jMO Bbotih 
^. IT. I T). Uia dlHWlOUB of Monontic motjvra uv, howovav, fur iiifcnor botb 



ESCa.lU.T BIT NOT IN AU. CASKi UEASCRABI.!!. 



ftl 



I Much of the best work of tbe world has »<> price, and 

fmiw altugvther tbe ecououiic calculus. Any cducatiou 

it a man gt^cs himself or his cMldrcu comes withiii ita 

ooly in so fiur an it it f^veu with the purpoai? of enabling 

itn to earn luoro moucy; w« can scldoni nic-osurc the mon^y 

of any bodily, nientaJ or spiritual tmiuing that is aii 

vA in itself, auil is not a meaus of puciiuiary gaiu. Again, 

nne uf thu work done in scicnco, lit«rB.ture atid art has a 

fEemiitty motive i another and a hight^r part htm its chiof 

wtirfe in tbe desirL* of fame; but the bigho&t work of all 

ktf Kircely any other motive thn.n the love of the work 

ud the wUb tu <]u good to th« world. The second part i^ 

ikwRtically capable of mi>a»uremi.>nt : but the last, in 

nwDOO with much else th»t is noblest in human action is 

*krul« altogiithcr incapable of il '. 

Agun, it i» important to guard against the error of 
■pposng that all mwwunible sflf-regarding motives are 
rf I loir urder ; for even when a person works simply in 
dim to get money with the intention of spunding it on 
lUBcIf, hb chief aim may be to gain the moans of cwlture. 
Mdthe opportunity for lining some impoHant work. Money 
* ecjii-titl pun-hasiug power, and is sought an a means to all 
bads of ends, high ae well as low, spiritual as well as 
•Ueriftl*. 

S 1 Tlie most syatematic part of peoples lives w gene- 
nDyUiat hy which they taim their living. The work of all 
Ifclie engaged in any one occupation can be carefully ob- 
*Bnii geoenl stfttemeuts about it can bo fonaulatcd aud 

k«iMMw« Md in tiKlb«4 to lb(w oS hli G«nnM oonitvinporftriM, uii) noUbly 
lonk. Tk £BKliali Mwhrr luaj commit witli ■d'Tvnta^o 871110'* OutUmt 
<M MMtm/ Stieiu*. 

' U ^mwtUn amtmeal llikt Don-inircliM«tiln, non-tnunnnLlilr plpiunuw 
^iHIMUwl »!■■> 4»d Uuwl to uiisvaMKtUi tlw imiKTBBt uf clvUixttUiuu iklo 
Wlauii ti Knles I'nlitiMl Keotomf. m. t. 

< nu fviaA U f uttlinr dav«J«i>od in ftn ftdmiroMb «im7 hj CUII« IiMlk on 
flli«M Of it-Hiy. Wv bov v( p«^l« wliv purnuv lOQiiej for iU owti uk* 
Mbn miuf fui wkat Ek will purv-liaM. Ho donbl l!i]*i1oc'« mougUhica luppeu 
Rtii Mri ot m ieag life qKnt in btwuinv: ic tliU as iii olher ckww tlie IwbU 
if Ui( a tUag i» kapt ap afivr Ibv pTirpowi tor wbloL It vnm oriitlnnlly dnii« 
bi M«Md la stM. AbiI after all it givo BOfli ptople k fcoling cf povcr urer 
Mb*«r»lvwi, muA onire* tli*m ■ tort of «Btloi» reipMt In wlileh Vny 
• bitbr bat >lfa(V pJnww*- 



DOOK I. 
CU. TI. 

Tha 

lllXlllMt 

mvUvwan 
far tbs 

grratar 
piut Don- 

aUnuiil 
eTwIi; the 
ceoDornio 
oolrnlna. 



Svtr- 
tt'Kurdiug 

aMn 

luoUTMan 
■tot nMM- 
anrflir of ft 
Iriw aria. 



BuobivM 
irark bua 

ttnncTally a 

luoocy 

niea«ut«. 



82 



ECONOMIC MOTIVES. 



iwas 1. tcsU-'d bv coiiipariBuii with the rodult« of other obserratiiHu; 

J ' atid finally utiiiK'nuil cxtiinatcs can he fiuiui-d as tu ibc 

amount of money or general purchasing power by which the 
services are measured, that i.^ the payment that Lt required 
to supply a 8ut!icicrit motive for thoni. 

It is tnie of nearly alJ luotlvvs that their force dejieudi 
much on individual peculiarities of tasto and temper: and 
thi-i iriakes it very diffieult to predict the action of anyone 
person or "atom" of the social body. But the difiiotilty 
diminiiihes when ivt^ look at the action of an indu.stnRl gruup 
such an that which is fom^cd by all the wurkors uf auy girai 
cliuw who live in the 8a,ine neighbourhood: for their penKBut 
peculiarities are Hkoly to counterbalance oul- luiother So 
that in spite of the differences of individual chonurter it is 
possible, for instance, to estimate very closely the psjmenl 
that will be re<iuirwi tti priMlitce an ailetpiate supply nf kliour 
of auy grade, from tin- lowf»t tu the highL'St, for a new trade 
which it is [iro[io.sed to start in any place. A very liUlc 
experieut-e will enable a person in going over a factory of» 
kiiiil that he ha.'* never seen belbn: to tell within a iihilting 
or two B wtelc what eacli suL uf workeni are eamii^, liy 
merely observing how far theirs la a skilled occupatieii toi 
what strain it involves on their physical, mental and nionl 
faciiltie'^ 

The UDwillingTiees of people to undergo the faligiicoi^Biiy 
pai'ticiilar kiud of business work is thi-reforc in the first raok 
of measurable niotivett. Again, the unwiiUugQess to poaCpvK 
QDJoymcQt, and thus to save for future nets, is measured Itf 
the intere.'ft that is got by the poeaeasion of accumulal«I 
wealth. And, lastly, the desire to obtain anything that i* 
ordinarily bought and sold for money, is for that vcrj- reft»» 
eauly measurable by the price that people are willing to p»J 
for it; though here again allowance must be made tit 
diffcrerices in the means of diftereut classes of purchascra 
Tlic miKt- In all th(>i<e kind.t of artion Hetf-regarding motives are IM 
mMwl'^-"' '''5"'''* prominent; but they are not in exclusive poftaeseiM. 
maoftn/ ^'"' ''i*'^^"*-''-'. ^'>*J chiuf motives of saving capital, of spcodJng 
wteurt t» money on the education of children, and of bujing ildngs fbl 
their uso, are unselfish : and the actions which are promptoc 



LKT t'K8EI,FUll MOTIVES ARE MEA8UIUJILIL 



1» 



iOCt'iipy a very large place iu ccononiica. The reason 



lil^' aOi.- 



iformit}' in any ^ 



i-ctiou acts witli so uiucl 
;pniB stage of avilization that it« ufibcts uui be .tyHtema- 
UnUjr obeervttl, rt-duced tu luw and measured. 

Tbgoe ecouomiets who have tjpokcn of their sctvuce an 
ttMcned chiefly with MOf-rugardltig motivtis, have tacitly 
incliKkd luimng them a person's derire for the well-being of 
b Uaaily. But this is clearly illogical. The real reason 
^y this desiie is incKidtvd and yet other benevuletit and 
i^-mcn&tiag motives an to a great extent left on one edde 
If ecanomics, ta that their action ia irregular. The expetise 
■UA an EnglUbmaii with £500 o-ycnr will incur for the 
afaratioii of his children can be told pretty well botbrehand. 
Bm u th<> fiunily in England has tian-uw liinitx, nu gwxl 
fum cuuld be mode of how much ht; would give to support 
■ dutittite seoond cousin. Still less could it be itaid how 
Meh timfi ho would bu willing to ttpi^nd in visiting the 
fclWhw and widows iu their oiUieliun. 

h Is however trae that notne kintbi of philanthropic action 
on be described in »ita.tistical returns, and can to a certain 
nkai be reditced to law if stilHciently broad avt^ragcK are 
fAea. Fur Lheru i» M^&rcely any motive so fitful and irregu- 
lir, but that tatat^ hiw with regard to it can he detit:cte<l by 
Hi aid of wide and |>atieut observation. It would ptu-liaps 
W|KMnble even now to predict with tolerable clneumeas the 
•Wriptious that a population of a hundred thousand En- 
fiiaatu of averugi- wealth will givv to support hospitals 
Mi dnpels and missions, and in so far as thin can bt- done 
IkcR is a basis for an eoouomic diacuMtion of supply and 
waand with reference to the services of hospital nurses, 
nd outedutuuivA and other religious ininietcn). But still it 
* troe that by far the greater part of those actions which 
■kIm to a fccUug of duty and love of one's neighbour can- 
■4 be cli«aed, tabalated. reduced to law and measured. It 
i*fer Uui rooflou, and not because they arc not self-regarding, 
tW the loachincry of economics cannot bo brought to bear 

* & mtf im AfajaeUd llMt ihm hi^sr motixn kw m A0«*«nt tn •|ii<tJitj from 

6—2 



BOOK t. 

cn. n. 



mncU pill- 
1«iit1irv]>Io 

Ecuumuicd 
in luacb 

nltll It 

wiItlnKnMM 
tu ucHfiM 
Ilia uwa 
anJavniHiU 
I»r tlioM 
ulUa 



84 ECONOMIC MOTIVEa 



BOOK I. 

CH. n. 



Again, it is true that the earlier English economists paid 
too exclusive attention to the motives of individual action, to 
^ the neglect of those which lead to collective action. But, 
eoDiMtin as German writers have insisted with much force, economics 
gl gn^'* has a great and an increasing concern in motives connected 
iu £pMt- ^^^ *'^® collective ownership of property and the collective 
■■»• **.2* pursuit of important aims. 

We shall presently have to consider some of the many 
forms of collective property. By far the most important is 
that of knowledge, which generally becomes the property of 
the world almost as soon as it is obtained. Other forms are 
roads, bridges, &c.; some people take nearly as great a delight 
in the beauty of their public buildings as in that of their own 
houmes, in the richness of their public museums as in that of 
their private collections of pictures ; they are glad to tax them- 
selves to enable their government or their town council to 
carry out various plans for promoting the physical or moral 
well-being of the nation. Many new kinds of voluntary 
association are growing up under the influence of other 
motives besides that of pecuniary gain ; and the co-operative 
movement in particular is opening to the economist new 
opportunities of measuring motives whose action it had 
seemed impossible to reduce to any sort of law. 

Most of the sacrifices which men make for their country 
are such as cannot well be measured : but when many people 
do the same kind of thing in the same kind of way — as in 

Yktiilitj ill this objectioD. Tb« pMU wltkli it woold eaaie ui earnest and good 
luao to do deliberatvlT a wroof actioii, b «o great that no pleasure can 
compensate tor it ; it eauiwl h» ■wngbnA or mr««are4- Bat eren here it is Dot 
the (laalit; ot tb« pain, bnt its anowtt, that hinders it bxma being mearared: the 
)iaiu U )>nu-tivaU,T iufluite. People ol a lees noUe nature do bowerer some- 
tiiues dvlitwralelj act wraogl; in oviler to gun eorae pleasnre: and then the 
pleaaiuv baa wei(;bed against and veigbed down the pain at wrong-doing. 
Templatiuu* to do wivug have so ni»ch lariet; in funn and niamier that their 
actiuu can seUom be tahulaleil and reJiKed to law. Bat if it happens that the 
■auie kind ul teniptalioD is pnaratcd to a great manj people in exactly the aame 
isay. it ua; b« ueasuivd. Fo< iinrtance in the oU dajs of bnbery the pain and 
■liaiu« of voting: a^iaiusl one's voBarience was BMSwmd : and experienced agents 
oiuld It'll hi>w u>aH.v ptvple in a fx^m district wuald he indnced to inmr it for a 
bribt' \4 Xi HUil bt><i niau.1 hw a bnbe ol tl. It is not tikelj that many tacts of 
tUis kittil «ill VM<); bt' «»,vrtaiM«d: bat it Ihej (bdald. it naj be wcrth while to 
)<utld ui> » ^t^'^'ial hrauv'h vl invihmucs. a suet of •c«Banic pathology, to deal 



HOTIVEH TO CULLHCTITE; ACTIOS. CUSTOM. 



S5 



of coriipulitury coiiacriplioii ur cvun voIuuIclt slti-icc booxi. 
— Uw ecoQomic calciilua has a foothwIiL The gruwiiig earn- *^ "' " ' 
■toctHof the a^ the gruwmg iittcUij^L-nuu uf the masn of 
Ike people, and the gntwiog power of the telL-graph, the 
|Rtt, and other mcaua of coiuiuuuicatiou aru cvur wiiii.-mng 
tbtsoope (>f colloctivc action for the public good. The voice 
•f ecwmuics is but one among mnny that luiist be lii^toncd 
to i» the preporotioD for niiy public action ; but it may do 
aiiire. as will presently b« shewn, than it has done towards 
■MBuriog the advantages of different plans of public enter- 
|Bk!fenil wf-ighing them one against a.U(ither. 

{4. Lttbtly, there is a certain elaiu of influonoet; on human CimtoDi i« 
M&ii which do not tend to rauae change : they play the same J," IJ'ting"' 
|lrtb the inoml world that ftietion does in tht* merhanical. *^'*"**- 
VhenservRvl furvL-s are acting un a thing f'rictiou throws its 
■trcngtb with perfect impartiality ngoitiKt whichever of them 
^Ueoding to prevail over the others and to raitse move- 
|Hk So whatevur be the Nooiul foret'tt ttml am tending to 
pmil ovi*T others and to canise change, they are opposed by 
tt> Ibtces of individual habit, of •iooial cuhtoni. of ap&thy, 
tmiSiy and ignorance ; or to snm up tht- whole in one word, 
^ ihe want of frve enterprise, TVieir influence is none the 
tnBiiisturUiug because custom and habit have themselves in 
tpeu BMMumre been slowly fasliioued in the eourse uf long 
Itirmtiuttg by the almost uncoii».;i<)iiH balancing againist one 
tuUier of the motives for and agaiuat difiereut eountes of 
MiaiL 

Hie friction which they exert cannot be measured by 
ndf; because ite direction and even ittt force depend tifiun 
At tCDdeney to change by which it is callod into action. 
Jolitcao be often measured indirectly. F'or instJiTice, when 
iWiB is a gain to be made by moving fruui one occupation to 
uutKcr, or by changing one mo<]e of production or one 
■wfcfit (or buying or Helling for another, the rcsistiLnce of 
fiKtiaii hafl to be overcome : and the amount of the friction 
an be lueasuK-d by the amount to which the gain haa tC' 
ef'ire the change is made. 



CHAPTER VU. 



THE NATDRE OP ECONOUIC LAW. 



BOOK I. 

cu. vn. 

of ucouo- 
inlc Uw I> 

tbu tuvxe 
HH llint 111 

mcitiv^it. 



§ 1. The nature uf ecoanmic law has been in tomt 
measure in<licated in our inquir; a» Ui tbo rouge of ccoiumiic 
motive. Those actions that arc governed hy free cntcrpriK 
aod sclf-rcgordin^ luotives are, as we have seen, those whicb 
are niMt easily reduced to law and metiKurod; aud n-asoniiip 
with regard to such actions afford the eimpleat type* of 
economic thenry -. but they are not the whole of it. AVIier- 
ever any motive, whether aolf-rognrding or not seIf-regn^li'li)'. 
whethtT of public or private interest, whether based on iiise 
judgment or on iguonint iirejudii-e, affects any conadcmbli- 
claiw iif people in the same way, then the action of that 
motive cnii often be rcdueed to some Icind of money moawWi 
if not directly, yet at least itidirectly by comparison vfilh 
other motjveH that can be measured directly ; and then it 
<?aii 1ji_' brought more or less within the range of economii: 
reasoning. 

Economics is a science of human action ; and economic 
laws, prnp(>rly so-called, are laws of human actiou. It is 
true that the term is cominonly used to inchide certsjn 
physical laws, which play a part in economic diBcussion^^ 
as, for instance, the Law of Diniiuiahiug Return, whiob 
economics borrows fi-om the science of agriailture. But 
we are at pn^-^dut coucenied with those laws only whidl 
truly belong tn economics. 

Corresponding to the substantivt-' "law" is the adj« 
" legal ". But this term is used only iu connection with "law' 
in tho sooac of an ordinoncu of govemmenti nob in the 
wDse of a scientific statement of conucctiou between cauM 



TUE TERMS LAW AXD NOKMAI.. 



87 



ilk I 



md effect The a(ljectivi> used fur this purpose ia derived nwixt. 
fiia 'norma," a term which w nearly ec|uivaleiit tfl 'Mnw," *•'"• "'" 
■d night perhaps with advautagi' be substituted for it iu 
neslific disciunioiut. 

An ECONOMIC LAW ifl a statement that a certain course DaflnlUotw 
iKtiaa may be cxpecled uiidtrr L-c-rtiiiii coutlitiotis froni the nomai. 

iben of all indii^tml gnmp : aiKl that action is the 
sauiL action of the members of that group. 

N'onnaJ action in not always morally right; very often it 
K actioa which we should use uur utmost efforts to stop. 
Ik RHtance, the normal condition of many of the very 
ftcmt iiihabilants of a large town is to be He-void of enter* 
fncanil iiuwilHng to avail themsL-Ives of tlie opportunities 
Ibl may <i0vr fnr a huulthier and leiM sijuulid Ufc etn^where. 
Iklfhave not the strength, physical, meutal and luoml, re- 
^md for working their way out of their mjualid surrtjuiultnga. 
At existence of a considerable supply of labour ready to 
uiatch-boxe* at a very low rate is normal in the game 
that a contortion of the linibe is a nomial result wf 
bkiiig strychnine. It i« one reault, a deplorable result, of 
^t Mtion of those laws which we have to study. 

It will bo undcratood then that that course of action 
•ill ^ called oonnal which ir in general acconlnnce with 
•lit ■noima," do type or standard or gifncral rule of the 
fHfUn vhom we are at the time considering : the accordance 
DM be sufficient ta enable lui to make the i)h.tervationfl 
•»^aiiwl for estimating the money mcnsuro or price, which 
■ill on the ax-erage be necessary and sufficient to indiioe 
tbea to andertake it'. 



' h mil he noticed that Ihia nw <it Uir vord nannki In tntiniliT Cliaii tlifct vliirh 
(■AatAajitviI. It tsofUii aMd thai tliot* rvfitlU utilynr* iionuU wtiHi arr 
tela Um uiditMrlwd oetico of free wonfwtltlini. Anil if ■ iliurt aiul ■iiupi« 
■NBl of tbf IttD miMt bd iflTfin, M» in jioTlinpH tli« lH»t. R»t t!i« tnnn liat 
■Am Ih k apjitiol to <<uulitiiMii in wliivb pnfcctl/ free cflia[>clition Aoet uat 
•dA imt nm kMiQ; oeu be tupixwed W Biial. Titv uhu at Uib U-nn nov 
l"Vnid tf awrr- to ucmriMtttn vltli iU otjrniatoelral tnoaniiig, lui wull u vrilL tbe 
fi^ttj luistns* °l i^erjiUy !!(«■ An ubjeetiuu iiuij t)e nlaed Uiat II ban uut 
^^dmOj dfAaHo and risid cntlin* : bttt oa w« gn on it will. I tliinli. tw r^uiiil 
IW tb dUmitfaa arWac tPam Uda aonrM am not vmj great; and tlmt tbe nt* 
■• («wj*Md vm b«lp tobrbf Uh doflnn** at ocontimicN into doi«c ■.■aiinofliiiD 
*ttrMlIU>. 




or KOOKOMIC LAW. 



ILabMM 



OUaiKM 

ttonUl- 
MMarU- 
torat 
tnittu«l 



aMmJ 5rhfiui; *>!' our (icoii(»tiMc rcuMmtD^ 
k'^ hy tlic kiu(] of octitm which we thus 
I and comiaj; nitbiti the range of economic 
.NMiMf^ scientific maclijnci^- should W a& deR&ito 
jrtt at the fame time it should he flexible, so 
k^ d mmy ht Adjusted and applied to the var)-ing circiitn 
aDMA-v^ ^u>d characters of mnny varieties of people iu diiTereat 
q«Miutnc« and tlifierent timeB, in different occupntioDit, uii 
jMwnt eln^sex of 8<)eJety, 

The port wlticli the inachiner}' of iicionce plftj^ in thi 
finNluctioii of knowledge resembles in mauy ways th. 
M-bich material uuKhiiior^' pUys iu the production of goods 
tin both cases machinery selects those processes which 
be reduced to system. In the production of goods, when 
the same kind of thing has tu be done over and over again 
m the same way, it generally pays to make a machine to do 
it But whem there is so much changing variety of detail that ' 
it is either iniposaible, or at all evouls unprofitable, to us^^j 
machinim for Ibo gooda, they must be made by hand. SiDiLlarlji^H 
in knowledge, when there are any proce«Be8 of luvestigotiou ■ 
or reaeoning in which the i^ame kind of work has to be dotii 
over uu<I over again iu the same kind of way, then it ia yrort 
while to reduce tha proceiwes to sysUmi and to erect tbi 
machinery of science iu order to deid with them. But afte 
all there is so much variety' in economic probleios, eoonoinio 
causes are intemuaglcd with others in so many diilerent 
■ways, that exact scientific reasoning will seldom bring us a 
the way to the conclusion for which wc arc seeking. I 
would be foolish on this account to reject its aid so far as it 
will reach, but st-mething mnst Iw left at the end to bo done 
by pnotical instinct and indued common souse. 

In some pnrt« nf the science the province of exact, reason- 
ing extends so far, that it eau go near to UidicalUig the right 
solution of practical problems. Rut in every practical 
problem it b common sense that is the ultimate arbiter. It 
is the function of common sooBe alnne to propnw^ ii [wrticiilar 
aim; to collect from each departoiout of knowledge material 
adapted, so far as that defiartment can do it, to tlie special 
purpose ; to combine the various materials ; to asngn to each 




'4 



ALL LAWS Of SeiMNCe IMPLT C?ONDmOK9. 



80 



its proper [tlaoe and importaiir«; and finnlly to decide what 
oonrse is to bo adopted. It U not tlie funclioii of a scieuce to 
lay down practical precepts or to prescribe rules of life. The 
lftw» of oconomics, as of other Bciences, are couched in the 
Endicative and not in the imperatii'c mood : thoy nre state- 
ments a* to th« effects pixjducod by differeat causes, singly or 
in coinbinatioD ; they are not rules rvady for imniL-dinto 
applicnlinn in practical polities'. 

§ 3. Again, the laws of economics as of other sciences 
uc statoments as to the effects which Tn-ill be produced by 
certain causes, not absoliittsly. but subject to the condition 
that oUter things air eqtutl. and that the causes are able tn 
work out their cflFocta undisturbctL On this account it bus 
been called a hypothetical science, and IhiH temi has sonie- 
tunea been used disparagingly. But tsvery physical &ciuiic« 
b hypothetical in this sense. Even in a pre<lictton of an 
eclipse, there is a aupprcascd condition that the solar ayatem 
will Qot meanwhile have been disturbed by tho explosion of 
one of its members, or the advent of a large external body. 
Such disturbances are so UDltkcly that astronomy is justifiod 
in takinff no account of thcra; nevertheless it is based on 
hypothesis. Li oilier ecieuces disturbing causes are more 
&c<f uent, and therefore the *Ninditiomt)g clauses mun> frequent 
and more prominent. Almost every scientific rioclriue, when 
carefully and formally staled, will be found to eoutuiu some 
provi-ra to the effect that other things are equal : the action 
oi the causes in questiuu is supposed to be isolated ; certain 
^StcXa are attributed t4i them, but only on the hyp<ilheras that 
DO cause is permitted to eutor except those distinctly allowed 
fur. Tlicst: conditioning clauses are not continually rvpualcd, 



DOOKI. 

oil, VII. 

The luHn <if 
ocwwunlefl 
an not 



All Dciea. 

UBc dnc- 

triue* 

Ucil^ or 

iiuplldtlr 

•Miinii> 

certklii 

coti'Utiviu), 

•till oroin 

thi* (wom 

hypu- 



I On Utia aBbjact tbrre u lilUe iliScrcnr* of upiuicni smoug Euglinh vrnliuiiiiit*. 
Bat WMB3 *Ttl«n lii oihw ronntrlcf. &111I mim-UII} In FHue<'. Imvc not t>f«D 
onirfU to iMiiit on tlic ponl; BCimtiflR r)iHTiM-lcr of ccnuoinira; nuil have cii' 
Inged Ha xv|il* (o u Iu luakv tl iudiulu luueU vliich kd cIkni U jiriiiriplM 
rf|nctl/«llM>Iitici nr u aUiraiiCKt ai vuMwAvaS pnblirUla. X Btrikinn inulaoea 
•f lUa •* found in U. Iat*1»}c'i l.im l.oit Jt I'Samtinit I'liUliyHr. Ul conrVo W) 
MOKiaUBt ntaiiu Ibe IJlicrly. cuunnoii to all lb* world, ul oiirrrWliil liin opiuiun 
Aai a rnfUi* cobtm o( actiaii In Um rii^t one under giiea uiraumUmcivL, Ami 
H (fan rflttonltlBa d Ibo frohirm arv cUed J Moeanlc^ be tnaj apeak wiUi a certain 
•■Uinrtij. Hat «■> tnnr a cbMoliit wiili rrsanl to otbor problapif. anil jti ni> 
IwiMialib peruiii reeuMii Ibi- law* uf eluMiiiUiT ■» rrOMpU. 



90 THE NATURE OP ECONOMIC LAW. 

Boox T. but the common sense of the reader supplies them for himseIC 

J ' In economics it is necessary to repeat them oftener than 

5^J^ elsewhere, because its doctrines are more apt than those of 
the iimtUed any other science to be quoted by persons who have had no 
mnrt be scientific training, and who perha[>s have heard them only at 
^^ ' second hand and without their context, and they are liable even 
to be deliberately wrested from their proper meaning for 
partisan purposes '. 
The scope Again, it is sometimes said that law is more universally 
^earoniiifc-s true and less changeable in the physical world than in the 
jj'?*2' relations with which economics deals*. It would perhaps be 
»<*P"r- better to say that an economic law is applicable only to a 
trine is very narrow range of circumstances, which happen to exist 
°'™*''' together at one particular place and time, but quickly pass 
away. When they are gone the law though still true as an 
abstract proposition, has no longer any practical bearing, 
because the particular set of causes with which it deals are 
nowhere to be found acting together without important 
disturbance from other causes. Though much of the scheme 
of economic theory, much of its scientific machinery, is of 
wide application, we cannot insist too urgently that every 
age and every country has its own problems ; and that every 
change in social conditions is likely to require a new de- 
velopment of economic doctrines, 

' One reasoD why ordiuaiy converaatioD is simpler in form th&n a aeientlflc 
treatise, is thst iu couTeraation we can safely omit conditioning claases ; beoanse 
if the hearer does not sapplj them for himself, we qoickl; detect the misnnder- 
standing, and set it right. Adam Smith and man; of the earlier writen on 
economics attained seeming simplidtj by following the usages of conTersatiou, 
and omitting conditioning clanses. Bnt this hss cansed them to be constautly 
misnnderstood, and has led to mocb waste of time and tnmble in profitless 
controversy ; they pnrcbased apparent ease at too great a cost. 

> See e.g. Koies, PM. (Eton. ui. 11. 



CHAPTER YllL 



SUMVARY kSb CUXCLUSIOK. 



BOOK I. 

m. vui. 



§ I. We have traced the growth of of onomic frowliim 
and euterpriyL', and have seen that the chief fcatures of the ''"''" 
present economic problem and the chief incDiitivcs to econo- S'"^™"? 
mie Btud_y are of quite recent date. Till not vury long ago 
the distribntion nnd exchange of wealth wore govpmed in the 
main li}* condittou^ which chaugod but slowl}*. by institutions 
which had the authority of cuHlom and ])ivsc!n(»lioii ; and 
which most people wore content to lake as they found them. 
Even when- there was no slavery anil no rigid Myslcm of caste 
the governing classes seldom took nnicK thought for the 
material well-bping of the great mawi of the workers; while 
the workers had tiot the habits of mind nor the opjiortiinitiea 
of thought, and action required for thinking ont the problems 
of their own Wves. Much of niorlem ecouomics might indeed 
have been anticipated i« the towns of the Middle Ages, in 
which an Intelligt^nt and daring spirit was for the fii»t time 
combined with patient iuduslry; bnt tliey witc not left W 
work out their CAroer in peace; and the world had to wait 
for the dawn of the new economic era till a whole nation wa» 
Mtdy for the ordeal of economic freedom. 

We have seen how England t^pecially was pn^pared for 
the t«8k, but how towards the end of lant centur)*, the changes 
which had »■-) far h<;en slow and gradual, suddenly became 
rapid and violont. 31echanicai inventions, the concentration 
of industries, and a Hyulem of manufacturing on a large scale 
for distant markets broke op the old traditions of industry, 






I, or I 



and l«ft evcty one tn bargain for himself as bcxt hf: loj^ 
and at the same time stimulated a rapid iiicrca»i of pupular 
SvwvM']'- tion for which no proviflioD had bcon niadti hcjrond stouding- 
rcwm ID foct'OrieB and wurVshoptt. Thus fires competition, or 
rathto', frvodum of itidiutr)' and cut^'qniac, was svt Iood6 
niD, like a huge uutiuiued luuuster, it£ wayward course. 11 
abus« of their now power byabU but uncultured bitsint; 
men led to evils on every side; it unBtted mothers for the 
duties, it weighed down children with overwork and discaac ; n 
and in many places it degmdcd the raco. Meanwhile tlf^H 
kindly meant reckleeenesa of the poor law did even more t^^ 
luwur llie moral and phy-tical energy of Englishmen than the 
h&rd-hearte<l recklcsttni'sa of the manufoctuiing discipline ; 
for by depriving the pcogtle *if tluise qiialilins which would fit 
them for the new urdor of tliiiigd, it increased the eiil uud 
dimluiiihed the good laiused by the advent of free euterpriae. 

And yet the lime at which free enterprise was showing 
itaelf in oii unnaturally harsh form, was the veij' time 
which ecouomiMt«i wt-re moNt luviifh in their pnuM-« of it^ Tt 
van partly because they saw cleajly, what we of th» gene 
tion have in a great measure forgotten, the cruelty tif 
yoke of custom mid rigid ordinance which it displaced ; partly 
bL-cBUHc the general tendency of thought in England was 
that freedom iii all niattcns, political and social, was worth 
having ut evi:ry coHt irxcept the loes of security: hut ])urtlj 
also it woa that the productive force which free enterprie 
was giving ti> the nation, wan thi^ only meanii by wliic 
weakened tu it woft by a ^rie;) of bad harvf»l«, it cuuld of 
a eiicceisful rcoislance to Napulinm. ICconutnifits iherefuro 
treattKl free entL-rprifte nut indeed as an iitnnixcd good, but 
08 the natural »tate of things ; and they regarded Ob crila 
of secondary impoitanoe. 

Adhering to the lines of thought that had been sta 
chie6y by media-val traders, and continued by F'rench 
English philosophers in the latter half of the eighteenth cen- 
tury, Rieardo and his followuTs developed a theory uf tbo 
action of free entcrpri»: {or, as they said, free competitiou) 
which contained many trutliH that will be of high importance 
so long as the world exista Tbdlr work was wondorftiUy 



B log 

le i^^ 
TtdH 

'thSI 

irtly 
was 

firth 
jtl y 
tri^H 
lic^^l 

Juro 
II, but I 

rila^N 
hi3H 



SUMMARY. 



93 



within the area which it covered: but that area sooxt. 
m vny Darrow. Much of the best of it cuoaisUt of j)n>blL'ms '^•'_*|*'- 
tclttiBg to rvnt an<i tho value of corn ; problems on the SnumiMy. 
wlatKin bf which the fate of Gtiglund just then Sfcmcfl to 
dipead, but which, in the particular form in whi<:h the; were 
ffirli«d out by Ricardo, have vcrv little direct bearing on the 
(KBHtt state of thioj^ A ^ood dual of the n-Kt of their work 
w [iarrowe<l and almost foiled by ito regarding too esclu* 
flTdf the peculiar condition of England at that time; and 
dHummiiees has caused a reaction. 

So that now, when more exporicnco and leisure, and 
pmHa material resourfes have enabled iib to bring free 
olBprue somewhat under control, to diiniitinh iLs power of 
imf evil and inoreas^; its power of doing good, there is 
powing «[t among many economists a sort of spite against 
il Suiue German economists in particular exn^;erate it»i 
tiib, attributing to it the ignorance and Kutfering, which are 
lie n«iilts either of t}Tanny and np|iressiini in past ages, or 
tllhe mixiindenitanding and mutmaimgemeDt of ecuiiuniic 
beii|{«n. 

latemiediate between these two extremes are the great 
bodjrof en)Domi»ta who, in (iprmnny, England, America, and 
HhpT rountrieA, are bringing to the Ntuf ly of ecotiuuiic questions 

rohiaiwed desire to ascertain the truth, and a willingness 
lp(hroii!.'h with thp long and heavy work by whi<'h alone 
results of any value can be obtained. Varieties of 
■■[|.of temper, of training and of npportuniticK lead them 
tovork in different ways, and to give their chief attention to 
diflueat parts of the problem. Some set themHclvco to 
tdket attd arrange facta and statisticu relating either to past 
• to preeent timca; while othere occupy thi'inselvts chiefly 
Tith aoalyHnt and reasoning on the basis of thoHe facte which 
■e ready at hand. This division of tuboiir, however, itujilics 
ut oppuutiuu. but harmony of purpose. The main work of 
rrety iDodcm school of economista is devoted to obtaining 
MM ]«rt or other of that knowledge, which is Dccessar}' to 
cokble us to understand the inflnonccii exerts on the quality 
■bd time of roan's life by tho manner in which he earns his 
-bcjihood and by the character of that livelihood. 





SCMHART AND OOSICLDSloy, 



■00 B I. 
CB. Tin. 



iDflilfM 

■retotM 

MTuwnl 
wttbrD- 
faraucu 
uot to tlio 

aims wlilcli 

eerva. 



' "J 

i 

irac- I 



The CHxinnmUt must htr grut'dy of fiicts ; but factst hy 
lbi^uiM.'lvL>i> tvw^ti iiulhiiig. History tclU ut* goqucoct's aiid 
coiucideiicex: tn iuterpret these and dxaw lesHoni &om tli 
reijuireg the aid uf rt-a^oiL Th« work to be done is su vori 
that much of it must be left to he dealt with by traiw 
oonimoD sense, which is the ultimate arbiter in every prao 
ticul probli'iiL Ecuugmic iicicDce is but the wwrltiiig of 
comiDou sense, organized and equipped with a luochiuory of 
general analysis and ivasorung udApt«tl for collccliug, amiDg- 
ing, and drawing inferences from some particular cla^is of ' 
Jacta. Though itjs aoipu is always limited, iliuugh its i^-orj^^ 
without the aid of common sense is always vain, yet in aJnio^H 
every ditbcult prublom it will enable ounmioii esense to go 
further than would otherwise be posnible. Its chief work is 
connected with the measuremeuL of inotive« by the priuo | 
which, as a " norma" or general rule, is utiOicient to induce 
a poTSuQ of a particular does under givon eoiiditiuua to under- 
take a certain task or undergo a certain faenfiec-. A «tate^ 
meat with regard to man's normal action, or in other woi 
an economic law^, is uot more hypothetieal than the lan-s 
the ph^'sieal iseieucefi : for they also contain or ijupty coD' 
tiona But there is more diHicuky ui making the conditi 
clear and more danger in any failure to do so, in oooDOmi 
than in physics. 

The Ktudy of theory must go hand in hand with tliat 
lacts: and for dealing with most modem problems il 
modem Gtcln that are of the greatest use. For the ecnne 
records of the distant past are slight aud untrustworthy, a: 
the economic conditions of early times are wholly unlike those 
of the modern age <»f free enterprise, of general educatiim, 
true democracy, of steam, of the cheap press, and t 
telegraph. 

§ 2. ICconomics ha^ tLeu as its purpose firstly tii aetjui 
knowledge fur its own sake, and secondly, to throw Hglit im 
pructicol iMsucs. But though we arc right before eDtering on 
any study to consider earerully whiit an.' its ubcs, wc should not 
plan out oiir work with direct tefereucw to them. For by au 
doing wo are tempted to break off each lino of thought m 
aooa as it ceases to have a direet and immediate bcaiiug on 



lose 
jir^^ 



ran uuitKH of ccukumuj ixi^uiitii». 



89 



cul&r aim which we have in view at tht- time : tho book t. 
pursuit of practical aiius leads us to gruiii) togeiWr ' '" '" *' 
liu ofail sorte of knowledce, which have no counectiou with Iraitoiiw 

, 1 ■ 1 . ,.1 n«nr» at 

|M mother except fur the itiniii'Uiute purjMwus of tuu mo-tbonili 
■uil.uid which throw hut litdo light on one another. Our wbidi 
MUtttl energy is spent iu going from one t«i another ; uuthing ^'JJ^^ 
idurooghly thniight out ; iiu real prugri-H» Is niiule. 

Xh^ gruupiDg. therefore, which ia best for the purpo8e3 

(f Mxnce |n-nc«>e<lM uii the principle of colUi^tlng nil those fav.t>* 

ad na^juings which are 8imilar to ont^ iiiiother in na,tiire: 

nthftt the fvtiiJy oreach may Lhniw light, uti JtH tieiglibour. 

if vurking thus fur a long time at nne set of consideradous, 

'npt gnduaUjr nearer to those fuuJumeutal unities which 

R called nature's lavs : we trace their iLction Entt aiugly, and 

titn iu ct>inLiuatioii ; aiiJ thuK make progross tilowly but 

Imljf. The laws of human action are not indeed as simple, 

Hdc&ntto or as clearly aecerlmnnhle as those uf physics. 

Bit the rouim (T&re of ecouuinics an a. i^parate M-iunce is 

lilt it duals chieHy with that part of muu'» action which ia 

1 9M uad/BT the control of iiiea:?unible motives ; and which 

.ttmlbn lends itself better thtui any other to eysteuiatic 

Rttwiug and aoalysia. The practical uses of economic 

mditt should never be out of our tniuds ; but our chief direct 

Uttue to study aud interpret factA and to find out what 

*t th«' «K)cts of difieniOt causes acting singly and in coin- 

kntioti. 

S 3, Economics is then the science which iii\estigates Q»watioi»» 
■u'c aetiim in the ordinary biislnaHS of life. It pumiici« the v«rti{U«d. 
^nios:— 

Hmr does economic freedom tend, (hj far as its influence 
tlKbn, to anaogc the production, diNtnbution and exchange 
rfwetlih t What orgwuxation of indualrj- and tradu does it 
lad to bring about ; what foruiH of divL^ion of labour ; what 
■iiiij[etneDt« of the money market, of wholesale and retml 
ieiliiiff and what relations between employer aud employed ? 
Bon doM it tend to adjust values, that is, the prices of 
■■imal things whether produced on the spot or brought 
fcnn a disLuic«. renta of all kinds, iuterunt on capital and the 
Mtmn^ rif alt forms of work, including that nf undertaking 



96 



SUUHAnV ASD C0NCLV8I0H. 



BUCIK I. 
«BA|-. VIU. 



PruUod 

IMUM 

wliioli 
gtunuLutv 

tlieiu- 

EuKliob 

MOUOIulilt 

ftltlie 

proHut 

tiinti. 



and managiDg business enterpriaes ? How does il nftV-ftt 
the course of foreign trade? Subj«ct to whnt limitatious 
is the price of anytlung a measure of ita real utility ? What 
incTL'a&o of happiness is primn fade likely to rosult from 
a given iuerwisi' iu the wualth of any class of soc-iety ? How 
far i« the indastrial eftioi«acy of any class impain-d fay the 
insufiu^eucy of il« income ? How far wuuld au lucrease of 
the incom« of any class, if odco effected, be likely to stut. 
itKelf thn>ii{{h itti eflfvct« Id lucntaaing their officiuncy 
earning power ? 

How tar does. a8 a matter of fact, the iiiiluence of oco: 
mic frtedoiu reach (or how far has it ivached at any parti' 
lar time) in any place, iu auy rank of society, or lu any 
tJcular hranch of industry ? What other influences are tn 
powtsrful then.-; and how is the actiou of all these ioflueu 
comlnQed? In piirticular. how fardoeseoonomic treednm 
of itH own actiou to build up conibinniions and nioiiopoIieB, 
and what are their effects? How are the various claswa of 
society likely to be affected by its ocliou iu the lung ruu ; what 
will be the inteniiediate effects while its iiltiiuate results 
bbiug worked out; uud,accuuut being taken uf thu time o 
which they will spread, what is the relative importance 
these two classes of ultiuute and iiiterui>.-diate effects ? What 
will be the incidence of any syst«:m of taxes ? What burdens 
will it impose on the community, and what revenue will it 
aflbrd fo the State ? 

§ 4. The practical uuucb which are a motive in 
background to economic iuquiries vary ftoui time to time, 
from place to place. But the following problems are 
Bliecial urgency now in our own country : — 

liow should we aet &o an to increase the good and di: 
niah the evil influences of economic freedom, both iu its 
iiltiinate results and to the counu* uf its progress? If the 
lintt are good and the latter enl, but thoeo who sufl'er the 
evil, do not reap the good; how far is it right that tiev 
should suffer for the benefit of others f ~ 

I'aking it for granted that a more equal distribution 
wealth is to bo desired, how far would this justify changes 
the institutions of property, or tiroitations of free enterprise 



hat 

1 



AIMS or ECONOMIC INQUIUES. 



97 



fWien they would be likely to diminish the aggregate of boob l 
tvAltb ( to other words, how hr should an iucrca*e in thrt "*' ^"' 
wmat of the poorer classec and a dlmitiutioQ of their work 
teflmed ftt, even if it involved Home lessening nf nationiil 
Mlerial wealth ? How far oould this bo done without injus- 
tM, itu) without slackening the energies of the leaders of 
jnp ttw I How ought the burdens of taxation to be distri- 
IMrI aanng the ditfun-nt ckMtws of dociety t 

Oaght wo to rest content with the existing forms of 
ifirinm of labour ? Is it ueL-esKary that large numbeni of 
kjd^wople sbuuUl be exclusively nccupiefl with work that 
^^pw eleratiiig character ? Is it poutible to educate gra- 
haliy luiioug tlu! grnat uibhs of workers a new capacity for 
ife hi^cr kinds of work; and in ]>articular for inidcrtakiiig 
onipentively the inBuagemtut uf the bustne^tis iu which 
|^r are themselves employed ? 

What aro thi? pn>|K.'r rdations of individniil and collective 
Who in a stage of civilization such as oiii? ? Haw far ought 
v^lontar)- aanociataon in Ita various forms, old and new. to he 
Wl to supply onllective action for those purposes for which 
HdiKtIiio has &|M.-cial advantages ^ What buaiucaa aBuira 
AwM be undertaken by society itself acting through its 
OtttroiDcnt, imperial or local "i Have we. for iustanct^, car- 
nal u fiur as wo should the plan of collective own(>r»hip and 
Wf »[ opcji epaci«, of works of art, of tho means of in- 
WMioQ and amusement, as well as of thotte material 
"loialw of a civilized life, the supply of which require* 
Vuted action, such aa gas and water, and railways ^ 
When GoTcnimcnt docs not itself directly intervene, how 
■' v individualB and corporations to conduct 
i^^ they ploasc? How far should it regulate 
'g«ment of railways and othor concerns which are to 
lit in a poeitJon of monopoly, and again of land and 
- :.:Jbgs the qaantity of which cannot be increased hy 
■nr Is it oeeoaaary to retain in their full force all the 
■wtisg righte of property; or have the orij^nal necf^ssitics 
:t)tt^ ijiey were meiuit to provide, in »omo measure passed 

Ak the prevailing methods of using wealth entirely jnsti- 
M. 7 



9H . SXnUUKT AND CONCLUSION. 

BOOK L fiable ? \M)at scope is there for the moral pressure of social 
" "•"" • opinion iu constraining and directing individtuJ action in 

those economic relations in which the rigidity and violence 

of Uovemment interference would be likely to do more harm 

than good? 

lo what respect do the duties of one nation to another 

in economic matters differ from those of members of the 

same nation to one another ? 



BOOK II. 

SOME FUNDAMENTAL NOTIONS. 



7—2 



CHAPTER I. 



CLASSiriCjLTlOlf. THE USE OF TEftMS. 



§ I. Ah Mill says': — " The ends of aciontifle clafisifica- 
tiim are best aiiBwered when the objects are formed iato 
groups respecting which a greattr iiumbor of gonoral pro- 
poedtions can be made, and those pn)pusitions mora im- 
portant, than thoso which could be raude reHpecling any 
other groups into which the same things could be distri- 
bubod." Bub we meet at titurtiug with the difHculty that 
lbo6e propositions which arc iho most important in one stage 
of investigation are not unlikely to be the least import-ant in 
another, if indeed tbey apply at all. The continual change 
and development uf economic phenomena renders it im- 
poasibte to decide once for all, what are bhe most important 
purposes which economic claA>ulica.ticiu htm Ui »nhBvTvc. 

In tluB matter economifits have much to leom from 
tlie Tocenb cipcricnwiK of laologj' : and Darwin's profound 
diacusBun) of the cguestiou* throws a strung light uu the 
difficulties before us. He p<nnt8 out that thcac parts of the 
slnicturc which determine the habitA of life and the general 
plan of each being in the economy of nature, aro as a rule 
not thoftc which throw most light on its origin, bat those 
which throw leaat The qualities which a breeder or a 
gardeuc-r notices as eminently adapted to enable an animal 
or a plant to thrive in i1« eavironmeut, are for that very reason 
likely to have been developed in eoiopamtively rocent times. 
And in like manner Uiohb properties of nn economic institu- 

> l«tk, Bk. IT. Cb. *U. Far. 3. 
* Ortfim)>fSp*eiei,eb.xiT. 



DOOE II. 
CKiT. I. 

nttoai. 



The diai- 

('Uttl«» ol 

vluudfyluK 
lliion 
vibiut Arc 

UHdr 



rLAsstprcA-nos. the ush op trrma. 



CH. I. 



lu it* XUK 

iifianat 
1'icoiioinii't 
uiiut tul> 
\ow a* 

imniiilile 
tift>, 



Bat Ibuls 

not alwajro 

coiuiaiiflit : 






tion which gtlay the must itiiportaut part in fitUug it for the 
work whioli it has to do now, aro for that very ruason Uk 
tn bo in a grmt mBa^ure of recuul growth'. This is oaa 
maoy reasons which force us constantly to compromise wi'' 
regnni t« th« ««<• of terms. For of caiinw if tJie sole purp' 
of oiir Bludy of ecouumics were to ohtaiii knowledge tlia^i 
would guide na in Lhc Httainmu-nt of immLtlintc pnicUd^H 
ends, we should yet be bound to ke«p oiir iis*? of t<Tiu8 ^^ 
tnuch as pitsidblc- bi harmony with lh« traditions nf thr i)a.>it, 
in order that wp might be tmlck to perceive the indirect hints 
and thu subtle and subdued wuiniitigtt. which tho pxpcrienoj^H 
of our lum^tioni offer for imr inatfuction. ^^ 

§ 2. The difBcnlties in tho way of the right uec of ttfrms 
would be great, eren if wo confined our attention to the 
problems of our own time. 

To begin with it ifl not possible to follow the estabiislied. 
rule that there should be a separate term for every impor 
notion met \«ith in the ftcience. In most physical »fien( 
indewl this rule is rigidly followed, atid & technical term i 
invented for each new notion as soon as it emerges. Whenever 
it lit seen that the things which have a certain set of qo&litica 
will often be spoken of together, ihey aro formed iuto a els 
with a npectal name-. But economics cannot venture 
mako more than a very sparing use of apcc-ial technical termnT 
Its reasonings niiuit be exprtM<ted in Inngnoge that is 
lelligiblo to the general public: it must thervftve undeave 
to etniform ilwlf to the fnmiliar t*rm-s of every day life, ant 
80 far a» punHible nm&t use them a^ they an.- coniiuuuly ti»ed. 

In common use almost every word has many shades of 
meaning, and therefore noeds to be iuterpri'ted by the 
text. And. ns Bagehot ha.s pmnted out, even the most for 



iislied, 
irta^H 
ieno^H 
.rm^ 

;ver 

tics 

•ma ' 
an^^ 




I IimUiiroi nn latuiil iii luui; (4 ilia idtliaiia briwiM^o tsoflnyat •lul 
pl07f4. 1>(<t«t«n mtiliUmnnn AoA UtuArr, hrVKttm bMikxni •nd UudT lira itIuwm 
ditnls. UuNU trtnu Khoui the buikcrs borrow uil UiMr tu obom Ihaf laid. T 
•BbatUnUanaf thPtanii'*liih>n>»t"for"nmTjr" rnTfMpcnds M k c«mm] «b«i]g» 
in tho rlittni;Ur at loui*, wlucb ban gi*«u an eoUnil; now Iwy-not* (« urar 
anmlj-ib uid clwidflctlivu aT Hut dlB^rMil «lMmt« into wMck Uk ra«l of iwmlae- 
Uon al k tammoditj nuT b« manlTcd. Agaiii tite Reniml •clunnn of ttivtiduii 
(if Uhoiu into sUDail Mid uulrilliidla nudocoiUK ■ tjaiaal rliame: Uie M-.>iH<i>r 
Uie tmn "mil " U Mnit IntNuleued ia aaiiia dinotloR* aud ittrrnww) tn ul Wb ; 
■od M nn. 



DIFTTCULTIES OF ECONOMIC SOMBKCLATURC. 



IDS 



imt«n nn (economic ariencf art- compelled by the scarcity of 

inpiia at thtfir ilJapOMal lo follow tliis iirafticH, But they 

often do it tacitly, sometimes evpii unconsciously, aiid hence 

■Hmb coufuaiou. If tht- reader were weniwl of the practitw 

he would be more carefiil t«i supply an inte-i-pret«tion from 

tie contexl But the bold and rigid defiuliiuiiK with wluvli 

the ^position of the science generally begins often lull hiiii 

tutoiblae wcurity; he doen not gut to kuow what wiis really 

iiUicintud of the writer. Hence ha.ve oriHeti tniauuderstttnd* 

ttfs U)d controrersies which ha\-e diverted men's energies 

bva ooostnictive work, have brought the acicnct? into dis- 

KpotcMtd arc one of the chief causes of ite backward state'. 

Other difficulties are caused by the growth of the science. 

Tbtee igaiu are greater in economics than in almost any 

I'lHr Ecieuce, be«audc most of the chief distinctions murked 

bjtMuoinic tcnus are really only differences in degree. At 

in* (ijfht they have flppcorcd to b<? ditfert'ucos of bind, 

harb^ dhorp outlines which could be eliaiirly mai'kod out by 

JeWtJons; at all event* if there were no stint U> the supply 

•rf Uxhiucal terms. But a more carefiil study often fthows 

tbtibere is no real diM:oiitiniiity in natmv where a discon- 

tboiqf is suggested by orcliniiry Iniigimge; and yot that 

M^gMtioQ has perliapo been einpha^ixt^d by the formal d«li- 

nidnDcof the t«rlier writers on tht- science It i« a. remark- 

■Ue&ct that the progress of ecouomics has diHeuvered liardly 



BOOK II. 

en. I. 



lUffisruiil 
<!lsaaM of 

rlmic off 
impOT- 
t'l'iitiblj ID- 
unirdn one 
BiiolbfT ; 

llUt (|?H 

linH luicl 

klinrji Uuet 
of diriniiin. 



' W« M^tt " U write iDOH Ra re d« in couiidihi lsf«. w1i*t« the MnUit i* k 
Mrinusinwod 'iiiten>rtUtioav-lik<ua';«iil7Bii In Political El-ouoiu.v wv luvc 
Mt MmU UiiDCa tn apc«k (4 lluui in nnlinarj' ranTmuitinn. m: mniit lake 
■nafe,sir« ibot* wamliwc of ui; cliauuv: auil «t tluLvi trriu out -tlie iuler* 
JMHIb d«a*n' tur lh«t p%gr or dineuiiUnti lest Ihera hIiohIiI bo nay tnistalM. 
I bw Ihel Utt> in diflcull ui4 il«llc«u norh ; nii^ uU Lbnt 1 bavti tn w; In 
Um* bT It i* Uiat in pntflJM U ii uftrr than tbr «iiu]ifHing p'lan ot inSoxntt 
4i^lftnu Jtityon% vho trie* to <*iprtv>H varj^ntH tM«>A>fi»^ii 01:1 D»fiiji]*4 tliUAgv 

td • MWMT TOBebalaiy cf tacteiiocl ihoiko. nUl Bud tliat bU i^lylc giov^ timi- 
kiMi «lUMMat tvus aociUMle. Uial tu> bas to oac Iniig iieriiitiruneia for coiiiiuuii 
AMghla. hmI tk«t aftvr mil lif iloiw nut oomv out riulil. fur lie Li IihU tin- tinip 
UB^bukbAD Um acswta wbicli tli (lt<' I'aiie In hanil Wtl, aiul tlit«>' ncu *uiue< 
Smm enp, momtrUta** iu>A*t, anit alDUMt nlwajm di(Iar«iit tntax hii ' ii*nl anil 
Sit' wHM In null lUacnairioiipi w« aliouM Iciiuru to var^ iiur il«Hiiltiii»< kh we 
PMC, t«* M ve M7 'Irt a. y, <. moan ' uuw thU. tunl uow that, ui ditTcrvnt pr<4i- 
km; n4 lUa. Ibnncli Ibcj^ ilti iii>t alirn.T-i aviiw it, is ruuUj ilic pnurtin' »( tile 
ttaiwt awl uoet aAaethv KitlOTs." {Baoeltnt * t'lixutiaif uj y.mjliih I'litUUtil 
«— ef, fp. TS. a.) 



104 



CLASSirtCAllOX. THE VSS OF TEBJB. 



Tlianiutl}' 
■taof con- 
«qttlanii 
tJjuulil Ih> 
riutiroiulj 
•clcutiflc. 



Badi term 
Ullltl 1)UVI< 

B iltliuitioii 
CO [re- 
ap ciiiiliiiH Ul 
nliBl tKfOUl 

tolwlta 
iMcliii^ 

UKB : «jul 
111 in malt 
hn Hiipplo* 

on inUc- 

prt't&tian 

vrLvu 110- 
cMMry. 



any d6w real (liffert^iiccts in kind, while it ts continvi 
resolving ap]iareub difftirtjnces in kind into diSeretices in 
de^frea W© shall meet with raaoy instances of the ovil 
that may be done by attiiinpting to draw bniad, hanl and fast 
linus of division, and In formulate definite projwsitiune with 
t^ard to differences between things which nature has not 
(H-'pftraWd by aiiy such liiiiw. 

§ 3. With these difficulties before us, the right course 
neeios to be tu aimlyse thuroughly the notiouB wliich underlie 
the variium lucaningH al' the chief economic tt'miii iu common 
una. and to bafic all definitions on this analysis: which indeed 
is a wurk of the highest importanci- for its own »aJ>e. Even 
among the most careful thinkers there will alwaj-s remain 
differeaces of opinion as in the exact places in which some &t 
least of the lines uf distiiiitiuu should lie dniwii. The questiuna 
at iaKUc muflt in g^nural be Holved by Judgments ua to tho 
praoticol convouieuce of difffpeut coursea; and such judg- 
ments cauuot alwaytj be established or overthrown by scientific 
rcasooiug: there must remain a margin of debateable ground. 
But there is no such margin in tlie analysis itself: if two people 
ditJor with regard to that, they cannot both be right. And 
the progrees of the science may be expected gnkdually to 
establish this analysis on an impregnable bosL-^ 

Starting with as goud an analyuiH an we can at present 
make, we shall gene-rally finil that there is some use of each 
tL'Ttn which has distinctly greater claiing than any other to be 
called its h-ading use, on the ground that it represents a dis- 
tiuctiuii that in more important for the purposes of modem 
science than any othe-P that is in harmony with ordinary 
usage. This may be laid down as tho mwuiing to be given to 
the tvrm whenever nothing ta the contrary is stated or implied. 
by the context. When the term is wanted to be used in any 
other sense, whether broader or nani>wer, an indicslion of 
the change uiuitt be given. This can often be majiaged 
without any formal interpretation clause. That must, how- 
ever, be always supplied where there is any daiiger of niLv 
understanding'; aitd in a few cai^es of extreme ueceaHity, 

> Wbpn it i« wautod tu uwTow tli« tueuiinc of a l«nu (Uiat ia. In lofical l«n- 
gnagn. te '<i««<"tj'h itB*it«iBiaD b;liirrM«iiis it> iiituuiou) u <|tiBllf ring niljpcilrp 



MTOCULTIES OF EC 



tf^chnical terms mu»t be invpntpil. B^' thin means moox n. 
shall retain sjinplicUy of language, aud yet attalu a "'' " ' 
Ic'licate adnptatiou of definition to the want-s of each j»ar- 
liculsr diitcuiuioi). 

All these difficulties toe illustrated by a gruup of terms, 
3ted with the notion of wealth : and these we must 
examine at once, because they will he used a great de«il in 
te coining discussion of demand and supply. 

Many of the ipu'^stiuus raised iu this Second Bouk are v«ty 
ocMDplex and intricate; they cannot be altogether noglectod; 
but yet they have not a very important beeiiug on the main 
pTobleiu3 of economics. The reader who is now hrst intro- 
duced to the subject, is therefore recommended to pass 
^btly over them, and to return t« them at a lat«r staj^a 

f «11I getkeimHj ittlRtt. bvt ft d1imib* {a tbe opiwisite illiyctJon rjuinol as b rul» bo 
I ao aitii]!!; siaJ*. CMiU^itu a* to definition* Are atUra cd tliit kind^— -I nuA B bm 

fiMlititt MMBiMi to k ffvtX ntmiW of tbingii, taauy of tli-rw Ukuk* I»v« iu 
•AIIUm lb* qnatltj C, aai ai-alii mkuy tlie dUttUtj l>, ivbilc Mmg havn buth. O 
Bud D. It majr then bo ■TgDcd that on tlie wliule 11 will be Wa\ tii ilcfioo * tann 
•n M to bicinile all tbtnci wbloh bave llis (iimlUle* .1 nini li. ur oa\y Uumm 
wUd b«v« tbo qsalittM A, Jt, C. or only thou" vhidi kiva tlto qtulitioi A. B. D; 
«r mlj thoM which have .1, ^I, C, !). The dcoimdii 1>«tn(^n tlxw nriona 
•MRM mt IMt «ii cvt»!di'nt!«ii« ol pncticftl couTcniQucc. aa<l i* a ninlter 
tf far Imi iinportaiicc tlmn a c*refnl BtmlT oT tli« qnalitiafl .1. B, C. J>, nud tit 
■hiirllillUMl relatlouD. But uiiforttuuitvly Ihia duflj hux im^iijiImI a iiini'.}) «nnllor 
^IwOii fa Enali*l> Kouumicn [bwi coiilrotondiu m lo ik-QuitltJuii: wlilth Iikvh 
indMd OMUionAD* ItA itiilir««ttv to the dlsFtmry nf oriaiittilR U>nt]i. hnt iilw«y« 
ramidAbont root**, uhI aiih maeh wute of time wid Iftbatir. 




ilere- 

i1«l flnri 
from tbo 

|Hli3l( III 

vEi-wuf thi> 

wiJ Krlrr- 



§ I. All wealth consists of desirable thin^, or as we may 
call them COMMODITIES, ur goods. But itmiiy of the goods, 
or desirablf thin^, which a man hn« are not reckoned na part 
of hiB WHalth. W<? will tiret rouj^hly clasaify jjihkIs, and lh«^ri 
consider which of them are to be regarded as wealth. It will 
bu hoIicikI llial ht'it? wl> ary luokiiig at goudi^ from the point 
of view of the individiial, and not from the "social" point of 
view, under which may be included tht.- uationaJ and the 
"conuiopolitan" poim of viuw. ur that of niatJund at lajgv'. 
This seems to he the beKt starting |K»int, thoiigli there is no 
Kubi4tantial difffO'iiCL- betWL'un the aL-L*utinl« ihal will ulti- 
luatt'ly be givi-ii of wealth from the individual and from thq^ 
aocial puiuU of view. H 

" Some gr>txl.s arc INTERNAL, otht-rs kxtehsal, to the in- 
dividual. An iiit-iTnal good is that which he tiiidit ia hiiiuelf 
given to him by naturt, or which he edncatcs in hijnself by 
his own free actiuii. such as muscular .strt-ugth. health, mental 
attAinninnts. Everything that the out*'! world offrrs for the 
utistactiou of his wauts is an external good to himV 



' TkenB tcmu u« niwd hy Prof. Wkgrwr in liis rtccllMit •OMMUt of Um 
fuiitlaiiLUiUl uolJmiH uf t'ctiuuniicii. VolitinrlhtdtaPtlefirt, Vol.i. Cb. L. to wlijcb 
tliu Tinilrr mn; tie n-fcrri'il t<ir nntlccn of Uio oliluf •lIscnsalMiti at <lrllnltUiiia by 
aennnu writBra uud utlimi. Smi ftliia Prof. SJilgwick'a friutifilf »/ FolitiMl 
Hrmuims, Hiwk i, Cb. ili, •nil v. 

• Witi UiPno wnriUi Qcrmuui begbu thit monWrly uinljidi of woaltli \Siaaif 
•eirt^iclm/llithc ('I'rTjmfAiinprM, Clj- iii-l wWli i» tilt' bjtMS oJ iiiijit uuxlirni 
Gi^rmiut wog-Ii iii tlu» <llroctI«ti.' Tbo cfriitnJ idow of lila Aiiolj-ci* w« IuiImJ Io 
be fiiniiil ill i^Bilirt nrit«ni. Eiicliali BMcl uUien. Bui lie wan Uic fimt ta_ 
tbem liw f learnoM vlitcb oamn tnua ordBT uid io'kImu. 



[TERKAL AND ISTBRSAU KATERIAI. ASi> PeRRONAr, OOODfl. 



Again jjtkkIh are Materin!, nr PciMonnl nnd ImmatHnal. ooax n. 
ITERIAL giiods are all txluruat. Thfy wuiisist of [is«fii1 ' ^ ' ' 
mauria) things, and of nil righU tn hold, or use, or tlerive ^i^*'*'' 
benefits from maitrinl things, or to receive them at a future 
tiior. Thus they inclml*' the jihywcal gifts »»f uatiire. laiid 
and waUT, atr and climate; the products of agrirulturo, 
mining, fiiihing, and manufacture; buildings. nia«hiuery, and 
implements; mortgages and other bonds; shnn-a In public and 
|iri%*a.t»' ciimpanifs', all k!iid» uf monopolies, pa lent- rights, 
apy-rights; also rights of way and othur rights of usage. 
FliSailj, opportuuities of travel, access to good Mceneiy, mu- 
amn, »':l«. ought, strictly fipcaking to be rcckouL-d under 
[lis bead. 

niau's EXTEILVA I. PERSONAL goo<it are benefits he derives Kxut^ 
other persona They include (i) personal services of allJJJ^^*' 
kinds; (ii) property in slaves, labour dues, etc.: (iii) hia 
teputatioQ, the organization of his business, and his buBincss 
l^eonnociion generally*. 

Personal goods are however mostlv internal : a man's inurvai 
>NAL i>JTERKA!- goods consist ot hw o«*n qualities and good,. 
^ftculties for action and for enjoyment. 

Again gootb maj- be TRANSFF.RABLBor KON-TRANSFERABLE. Tnnt/tT, 

All internal goods are non-transferable but most external „cw imw 
gDodH are transd'erable. There an? however some ext-eptioiis;'^^!^ 
such external personal goods as the trust whieh a man may 
earn for hifi but<ineKK cannot be transferred ; while on the 
other hand there is a part of a man's busine.'w or profeiwional 
connection wliich can be transferred, and is ufteu sold under 
the najne of good will. Even some material giKKls, which are 
of oourw als"! exterual. are physically inca-pable of being 
tisnsferred, as for in-otajit^ the advantageH of climate, light, 
warmth, air, vU:. 

A person's non-transferable goods consist in a gn^at part The ludi. 

1 Tlud part 4^ Iba rahin Ot Ui« Khmrn in ■ trtiiliiig eotnpanir wMoh m do* to 

piwwi«l rflpvtaUiM BDiI foiiiiection ol tliiwv nho cuD<ln«t il« ulTain ouglil 

' lo ecHM iiii4ai Ihc uctt huti ■■ externa) pcnouol ggiTdii, Dnt Ui* jHriiit 

I MM of tnacb yncikal imporlAiim. 

■ Tn tkcM inlKhl be aitdKl Uiir plcamm lie derivni frcmi lodctj. (lieiidKUip, 

EunOy ■SmUou, etc. Iliit Mine caufaaioD mlghl bo <«u«k1 by lalroilurlnc ttwia 

ta*. 



108 



WEALTH. 



hODH n. of his fiKare of collective guuds, i.e. gwxU which 
""• " ' in private owucreiiip. Under this head comir the 
•haruofM/- which ho deiives from being a member of a certain state or 
•j^<i4. coiniminity. These iiiclutlu civil and militaiy security, and 
the right and opportunity to make use of public property 
and instituttotiR of a]l kinds, eucb as roods, gaslight, etc , and 
rights to justice or to a free educatiou. The townsman and 
the uouutryiuou have each of thorn for nothing many advau- 
toges which the othor oiUier caimot gyt at all, or can get only 
at great exp»uM. Other things being eijual, onu person has 
more real wealth in ita broadest sense than another, if the 
place in which th« former lives haw a bett«r climate, better 
roads, better water, more wholesome drainage, and chtiaper 
and better newspapers, and places of aiiiiittt'ment and iri- 
struciioii. Housf-ri»i«ii, food and clothing, which would he 
insuflicicnt lji a cold climate, may be abundant in a warm 
climatrt! ; on the other band, that warmth which kwscus men's 
]>h>':5i(»i needs, and makes them ncli with but a slight pm- 
vi^ou of material wealth, makcH them pour iu the energy 
th&ti procures wealth. 

Many of a perKon's non- transferable goods, including 
nearly all hw share of collective goods, may be omitted from 
the ealculutioii when hi» puiiition in compared with that of bis 
neighbours. But they become very Importaat when it Is 
Compared with that of persons who are living or have liveU 
in othtr places or times under widely different conditions'. 
FrttswMU. Those goods art- fhkk, which an: not appropriated and 
an afforded by Natnre without requiring the effort of man'. 



OockIsi 



BSlofW 



' The aboTo olBHificklliMi of Kouilti uiay Iw uipniuioil tlins:— 

} (ii«ii-lraiiui>niliM 

J I ItTMufenbla 

. Icti'iUKl-perMiiiBl'iujii.ljmLuft.'rTililc. 
Ot to kilopt DRoUicr BTTuigoisMit wUicli it Diiin! euu'i'ciiiiiiit fm- Mimr ] 
poncB, tliiu:— 



tDBLeritl-fs t«rn4l 



llniMfenlila 



I iiuti-t>*Eii>r«nliIe 
Ooodi «re i jtraiufcrablD 

ipxtwuaj (uuu-lrmi.rforablo 
iintcniaJ-Tion-l numf cnililc. 
■ Tlw Uii4 iu lla on|[iual «titta wft* ■ trve gift ot twtnrv. B«t in Mttloil 



peraoukl 



CONSUMPTIOM AKD PBODDCTION GOODS. 



Exchangeable gnoils are all those transferable goods nnoi a. 
rhich are UmiUjil in t|uanlit_v aud uot free. This dinluictioii '^^"' 
is not veiy importiaiit, because there are not many goods ^'<''*"'^- 
which are tnmsfL-mble, but being free, have uo exchange " "~^ 
▼alae. 

lAtitly. goods may be divided into oooDS OF thb fihst (i«oJ»*J 
MU>BH, which isatinf)' wantH din^ntly. snrh hh food, c!QtIieH,et<:.; kcuih/uhI 

>08 OP THE SECOND ORDER, which satisfy wants, not ^^" 
tly, but indirectly by contributing towards the produc- 
tion of go»da of thv Brvt urder, eiich as itmir mill»: while under 
the bead of flO*>l>S Of THK third OHDRH wc may arrangti all 
things that are u»ed for making goods of the second order, 
Buch OS the machinery for making milling machinery, and we 
may carry the analysis further if neceSBary. (Joods of the ';«"'*'""/'■ 
firet order are sometimes described an r-oNsiTjiPTlos or con- prajwht-n 
; BTMERs' GOODS; those of the second and higher orders being ' 
called PRODUCTION or PBonucEaa' ooods'. 

g 2. We may now pass lo the (pietitiun which of a per- 
floa'it |[ockU it is nififit convenit^ut to regard a» fonatitiitiiig his 
wealth. In the presumt tr<;atise, whi'n nothing i.s said to 



ffootU. 



ouoatiMB it ie not a fmi c<m(1 liviii tb« point <rf view of Um ludividatl. Wood it 
■till lloo In Nimti tJrkxtlinii htvatu : tlio llsb of tbo mk an tree ^■^■ki'iJ'T ■ bill 
MUHi MS flftheri«> art Jralooalj gnanliil fm tli« eiLcliuiYc lue vt irn'rulxTt «r ■ 
iiartalii Bfttion, and tmf b* elaaMd as nBtifoinl jiroperbr. 0;*t«r tH-dn thiil Iiuto 
batn {ilalitcfl hj mui are nut tt^e iti tuty tifUK : tli<Mr tlml have gronrii Dalunillj 
■» Ira* ill i-vM-j M-nuii il tbi-j am nut a|ijm>iiriiilii>l^ if llicy nr>' ]jri\ntii jirnj-irtj 
tlicf arc rtiU frrc gifts Ikhu Uio poiut ut view of the uotinii, but >iuM' tlic untiatu 
haaalbi'wtd itariKlibi iu llmiu Id Wonie voslud Lu iiidivl<lit&l> tlwyarc iiul trve 
tram tbo ftaal at tioir of ilii- iiidit iduul. uxA llui Htna i« Lnw »( jirivau nijliU uf 
llaUajt in Dian; rivera. Hot tlup »Ijt«t ipovn ou Ire* Inrnl ami tlie fial> mngtit in 
tiw tthrfita ar* tu>l fmp : fnr ttinf have bam aequiml hj Inbonr. 

1 ^h* latlw flaiwlfloatlMi aei-ina le haw baaa flnt Indicattxl h; Ra^ (Cauin dt 
r£Mtw»it fVili'ivr, Fart I. Cli. lii.). II luu b«ou iWiolofcd «itli grmt cmtv 
and Msaclt7 by HMtoauti auil atlicr writera. Tbp dlrialou of i:<kk1> into *ai-- 
■aalTi irftr-T la im to IVnt. Cart Uras<T, ( yotijiwirikMthit/ttl'Jirf. Cli 1. 1 ■!,} anil 
ta naad a gaoi deal bj Auatrian Mimaniata. Ol comae a hwkI moj bKlmiB tu 
aareral cadvn al lli* midh Iikw- For lijiitiin«i, a railway train mny l>« rari7iti|[ 
|HM>|^ en a ptt^aon) excttnion. and ko far ia a good of the ftnl ardor: if it hap- 
fvan to Iw (orTTiiijt *!'■(■ muuk tin* of liijiKuil^, e"ni<<< Tniltinx mitcbiiidnr and mjnio 
■KMihluarT thai ii nivil tur niakinn tnlilllig ]iiachia(n7. It i» at tlis aaiur tiina a 
eood at tlie eerund. tliinl aijil fiiurtli Ofden. But aabUetlcs nt tlila kiiiil are of 
tiUla UM. Than I* nnt •*'■) any lunHm atrraeniant ax ti> tlii> Unn (if ilivixioti 
batwaan Cnaunniptiaa and PmiliiL'tioii isotiAa, Surb Ibiii^n aa wlieat are coni- 
tuuly n&ha4 Mtb Iba ftonnnF, Uimtsb ipoakltif aUictlr Uio]r are ratr nuteTialH 
and n|kl l« b« nkoked aa I'mdnction gDodii. 



110 



WEALTH. 



BOOK u. the contrarj', a persou's WEALTH will bo taken to eonsist of 
^^- " ■ external giKxla. The greater part «( thee^; are inaterial goods. 
Apmwti-K which, it will bp n.'int;uiberetl, iimlude not only all iisfful 
^afiiisiof material thiiigH, but all rights and oppnrtunitics to hold or 
wlffWHle "^'^' '*'" t'^"^'^ b«aefit from materia,! things, or to receive 
them at a future tiniy. To thesf have to be added external 
pergonal gowlR, which iiicbub biiKiQeiw connections, good will, 
etc., and in some countrioa propeily in slave*, labour iixms, ote. 
Tt will be found that scarcely any discuKsions are aiTect«xl 
by iht* quc-gtiun whether the temi is used in this sense or in 
the riarrownr one which ht more coioiuon among EnglUh econo- 
mists and which limitH it to those of his externa! goods which 
art^ traiiMfcntbU- and not free. This narrow sense Itan its ad- 
vantages : bill it r\-(inin?» uk to make a great and often verj' 
inconvemcnt distinction between the point of view of the 
individual and of stH-'iisty ; for many of those things which are 
free gifts of nature to mankind arc not free to the iudividual. 
Id those vory few coses in which the diatinutiun is of any 
importance, the longer term exchanue&ble wealth will be 
used U> indicate all that part of a penon's wealth which 
eijusidtn of thoee material sources of enjoyment, and of those 
right* to them which, being trauafcrablo and not free, can be 
appropriated and exchanged 

§ y. While the use of the term " wealth " just adopted 
is broader than that of some writers, it is narrower than that 
of others; for they folluw on the linos indicated by Adam 
Smith '.and include undtr wealth all pernonal gootis, internal 
as well as external, which arc directly iisefid in obtaining 
material wealtlu Tliuy they make it include PKRKONAL 
wKALiu ; which tlioy take to consist of all those energies, 
faculties, and habits which directly contribute to making 
poople induatrinlly efficient, together with tlioir buaincitK 
oonnoctioas and associjitions of every kind. Thesu things 
have a claim t^ be regarded as economic, not only on account 
of theii- importance as factors iu the production of wealth, 
bnt b(3R(inse their value is as a rule c-apablt' of some sort 
indirect measurvmenl*. 



vfetJd. 






) OotDf , ir«iiIlA oj yatienA, Book n. Ch. ii. 

* Uwij enrloiu, but pncUinUr unimiwrbuit, nibtilotlM tn mrt TiUt 



INDinDVAL AND SOCIAL WEALTB. 



till 







This iwe of the tenn wealth has beou generally adopted 
by French tHHmuiiibiU: and miw many fj<;mijiti luid som« 
English vnriteis are tending in the !«ame direction. Then.' are 
many purpoKcs fur whith it is highly cmivpinpnf. and nothing 
aeoiDs u> W gained by debaniug oursflvi.'s, as suuil' Euglisli 
American econoinist« wish, from ever haring recoiirae to 
it. But since in the ordinarj' buniness of Ufe thf tena 
wealth itf {{cui-rully tukuu in u uurruwi-r iH.-n^-, it will uot 
be used in this treatise to include internal personal wealth 
eas on uxpru« indication to that effect ta supplied in the 
lutext 
Hi:!!; we a&t! a goud illustratiou of the general rule that 
of economic ootioiia i& a question of scientific 
, li'to which thero is little disagreement among those 
who have carefully stndied the matter; but that the qucHtiou 
h<tw broadly any term should bo used is one merely of prac- 
tical convenience, about which opinions may fairly difTer. 
Every one is bound to moke his use of the term cleuri but no 
cm« can rightly acciuie utheis of error becaune they use it in 
a brdoder or a uanower sense than seems best to his own 
iudgnicnt. 

§ +, \Vc may now pass to the social point of view. 

WEALTH, to borniiv a |ilinu«e that tn used on the 

.nen(, is the sum total of ihe wealth of the individuals 

|>ceing that social gi^iup which h under dt«cus»ion. To 

e a particular ca-w of such a grtmp : — National "wealtk 

the sum total of the wealth of the individuals cuuipo^iug 

nation ; and the boundary line nmnd it may be drawn 

any of the plans proposed for individual wealth, For 

le purpoees an «stiuiatt- of it is made directly and indc- 

■ndently: for others it is more convenient to follow the 

igemeut adopted in the case of iudividiial wealth, and 

inrnlofutl tlic MbriUon ot pciioual vmltli : (nr uitinjicu. in iu> for iw ■, p«nu>ii 
we* hlfl (K>IIJ«B lo Ao ttaliiith fur hU »wii iiiij-i,viii«iit, l.ho hencflt Uut lio il^rivM 
frwB Uuvt, tbongh certaiiilj' |«rt nl Iiii urAtllwiiig. U |>i>rliii,iKi Uvt nvrluiliHl 
fncB tlw nilinatv o( Ilia ««4ltli. But iLu Uue vl |iiirtiti<;>u hav b rtry tliLii. 
For uutabcr the funUn of ui Opem-kiiigaT arc part ot Uit woaltli In ku (ar lu 
lia m»» Uiciu fur Uk. bat ww oiilj dametitti ot ]iia iietl-liriitiB uiil uut of bis 
«M]th in M fkt M be OHM tlHun to mur iu vrirntit fat hin own pleuore. Viton 
)»«•*« ft droHawlw* nukm * item tor hcn-MlI, bi<r •tnna-uuikiiig funltlM an to 
iMNgMdMl M •rosllhiii tlw Itfoad um ot Uial Ivnu. 



HOOK It. 
at. n. 

in iiii'ludiil 
bj many 
rimtinen. 
tnl pcoiio- 



Woaltb n- 
mdod 
iram llm 
Ittint of 
vioKof 
Swirty. 

.Val iaiuil 



112 



WEALTH. 



BOOK tl. 
CD. tl. 



I>obU *w\ 

ol)litfiLli(»i» 
lit nil kiuili 

s nat!mi to 

lUlUlJu'l 

nmy bo 

nniilhil. 



to rcT^rd it aB the aggri-gate of thut. The futidameot 
notion of wealth from either point of view, we may repeat, 
is Lhu same : the dtSbrence is chiufly one of amugcmcut. iH 
Firetly. in astiinatiug- national wealth directly we catf" 
omit all debts and other ohligations diiu to one member of a 
nation from another. For iostance, ao tax oa the EngUfh 
national debt and the bonds of an English mlway are owned 
within the natioti, we can adopt the simple plan of count- 
ing the railway itsolf as part of the national wealth, and 
neglecting railway and goveruineut bonds altogether*. Bub 

■ Thv value lit n bmitu-iii luity 1h- U> iiumc c>I«iit ila<r ti> ll« ta«TtnK n ronitopnlT, 
iijtlipr n n>n>iil<iti> inniuipoly. ^iTarml pvrlinpt hj a pnbciit. ur ■ pftrtul inuiiopulj, 
uwirjg In tU tciLrua Iwing ixdlui knowD Uiaii utbuni whlcli ur« ntilf vpaHj iiooil ; 
uiil ill nil (u at tlii* U tilt c-Okr tlia liuMiiiMw dcMia nol odd to tlw t«*1 v(«IUi it 
tlio nation. U tii« raonopol^ were brvkcn dovu. Ui« dinUaatiua cJ ii44ii>na] o-fkIUi 
ive to tlir dln^itpviLnuct^ uf ilti viliM wiMiM KOQcnlly b« nor* than BuAe op, 
paitl^ b; iliv inrnuMiil mlwt nf rivxl hiinlnnuca, nnd [larllj lir tlie fiicnAaed 
linrcJiDxlniz jioni-r al Uiv iiii)tie3> rL'|iTu««>iittii|i llie wi^oltli at otber nMDiben of tba 
I'uuimiuiiij, (It mbuuld tiowuvor Iw uIiIhI tl»l in miiqd futi^cplionftl cuon, tin 
pric^ of ft roitimwhtr mny b* 1ow»T«d in o«iiMy|nouc-(' of lt« pTOdnetion bttag 
monopulixvd : Uiit tndi evvi nra iviy i«rt. ejid tuaj' Iw m.-K'^t*'! tvr tliv }««•»(• 

Akuiu. buiuii'flB cuiiu».'liuii» uid trade reputatiuiin ii4il tu ilia uatjona] wulUt 
only in tui tar hh thvy briiiic pnrchaMra luto relilion vEtJi tboM proflacen who 
will niwt tlii'ir rrsl wniitii nuint lull; for n ipvmx piicr; »r in otliur «<mh only 
ill M far ON tht>)- inirvMe Uia ('Xteiil Ici wliivli tli» «flort« ol the couunitultf u t 
nlinlv nii'Ol tlii^ urnuts of tlu> (MnDinQQitf ui n wbala. NoTDrUii>lciw wImii ire Me 
ttiitivutiiij; imtiojiit] WPollli, iiiit ilinvtlj but iuiliewctlv iu> (in- aKJcrO|j[Bt* of la41- 
vidiuJ wi>alth, wn mtist allinr for tbcac boMUonnii nt Uiuir foU valac, cv«d tkragli 
ihit imrily txiiinintii iif » niaDi>jiol> vliirh Is nut nwd for tki- iiulilii? bvucAl. For 
tlic injur; tliv; ilo Ui rivnl pmlunTii win Kllnwcd fur in couiiliitg ap Ih* rslnm 
nf Llieir hiihlnmniit; hiicI tliK luJiiT? it'tni* U) poiuiimen bj TaUiue tliu pviM << 
tile {vrodni-'i; wiiit^U tlii?; buy wu ollonud for tn> rGolMuiin([ the |iareluaiiig povir cf 
tli«Lr iiii-siiK. »o tiii na tliiv )iEirtiiTiilur wniiuitHiity ic n)ii(wni*Ml. 

A Hjivcliil caac of tbii 1< tlut iirgitiiUiLtloii <if cnrdit. It increwe* tb« uficlcncj' 
at imHltii'Liuii in the cinutTy. kiiiI tlius aililn li> imtiuiial wealtli. Atid tbc powrr 
(if iibtnkiilitB rrrtUt it a valouMi^ aHwcl Ui n-uj liidivt'liial trulrr, II, lii>wrvct. auy 
M-«id'.'Ut sJiiniUl drivr liitn out of liualiii'nii. Lko iiijary to iinUciud wualtb !■ niinio- 
tlilni! km tliaii lh<' wlii)l« ('aliii> of tint &<i«.'t, biiraiiw Ki>iit« |>iirt nt ImuI uf tlia 
buiiiiiMB wliiiJi he wonlil liuvit drniD will iinir tw iIuub tj tvUivni witli Uw aU ol 
sanic I'lUt nt Ivsnt ol tlip i.'iL|iiliiJ wliivL bt- oo'vilil liH^v linmiwiHt, 

Tlwit> iin* nliiiliur lUfflrnlUc* nt> U\ liov far iikniiry U Lt> be rtrknnnd >• part stf 
iiatintml wrtillli. lummYcrtiMH pa|>ur curroiicj. isBUtd bj tlin anLhuril; ul 
BUVunuuL'iit. I> an onlf<r lya tbo uminriJ vnUCli at tha eammiuiit; : cinivartitda 
unlua by n'liamaiwvcr ianueil aru iLircH^t lieu* uu tlii' [wopurty u( tbim wbo UaiM 
tbrtu. Tlia>. wbfii [■H-koiiiiiK tliiC mtiJtli (if tlic cunii'Iry, wo luimt miiiit iit nil 
tilt iinxioDH iiiutalii iu it. of wbiit«TDr fonn the? air. Uul no mnat not count in 
tllr iHitxT runrvui?; fiir thnt uuat he flutHd nilb niiutcatKe, HiUUig m auwh 
tu Uu- i1elit«r at to IbHnwIltiir ildr itf Vlii- iintiniial halaiirv. rirrpt tDdeadiDaa|_ 
far aa tlmy add tu tlii? dBeiouey al ilx buuuoui ariiauuuitjoii, iiimii Ea au 



lOJfAL AMD COSMOPOLITAN WEALTH. 



119 



still have to deduct tor those honils etc ii<Kui;^d by the 
ijglish Government or hy private Englishiren. and held 
Inr foreigucis ; and to add for those foruigo houda kc. held 
b; £nglbhineu. 

Secondly, there ore luauv guuJa which urc soiuetituc-s 
Lir«d iu estimating individual wealth (though they are 
Jy part of it), becaust they are free to aU ; but which 
lust be made prominent in an estimate of national wealth. 
[t is obrioiis.that a road, or a bridge, or a canal, that i» open 
the public toll free is doC in any sense whatever a less 
iportant element of national wealth than it would be if it 
rere iu private haudx and made lo yield a din>ct money 
venae', &nd that it must therefore be alwaj's counted in 
of the nntioiinl wealth. 
lut the Tliaines has added more to the wealth of England 
than all tt« canab. and perhaps even than all its railrotuk 
And ihough the Thames ia a free gift of nature, exeept iu so 
br aa its navigation ha8 been improved, while the canal u the 
work <^ man. we ought for many purposes to reckon the 
ThameB a part of EngtandV wealth a» much s^ the Bridge- 
■water caual. 

Finally we should, in accord with German economist.-?, lay 
on the non-material elemeuw of natiouuJ wealth, 
itific knowledge indeed, wherever diacovered, soon be- 
oomes the property of the whole civilized world and may be 
llod ooemopolitan rather than uatiouul wealth. The same 
. tefue of mechanical inventions and of many other iniprove- 
ita iu the oris of produvtiuu ; and il i» true of music. But 



MOK ti. 
CB- u. 



Butfnv 

icuwlt 
■nasi tm 

•rltli 



value et 
Ibvoigaiii- 
uibuot 
(U-ifij or 
tliv StftU. 



poftant part of th* eonntiT'ii wnkltb. Snnii'thint amf h* rw.k.inpil far Hum 
■nilft tliM 1m«>1 I llw Scotdi tjaUiii at .CI ii-ilr* Iiiu adiltrl laaeh In U>v •^•>uutrF'a 
wialdi. Ot coon* (Iwr* tin »iMur who tluult Uint tli« cviit u( ■ tiiiitallii- ciumicx 
la ml eanpenaaled (ui bjrtlip BMuriirniiioiliFr ulianiaccawliiiii It Bflcinia. UnX 
dnc* itioaa imUoih nlllrli hnic ■ mrlalllc ciirn<nrj ixitiIiI dlxplace It U tb«y uIium 
bf a 9*V* canvncy. wn arc JastifiMl in aHmniug (ur Uie irnwiit tluU It ia wwth 
■tat it«oslB. 

WIi«i ■■ got si naliiMMl WMlth not dirvotl}-. IjuC tm Ihn ^ggtognlf ot iuiii- 
rUnal nadUu nsouimt tiu roM aDd hIi<««<>ui in tLc ihimvhbiuu .,( c-icli tvrwju 
m it »uaii». ^otia istmnl hj ^-utcnuoEUt uid Iiy (irirntc bodu'i art trralott uu 
tba mtut plan aa cuuaoli anil railw*; di-bviititm n-ii|i«:UvMlj : tlial U tb«; kn 
mlinilWl M twtll aiilm Ol Ibn acciiallt: nn tli'' onv Milo ■■ {lul of tU« WMlUi of 
brii«idaal« obo bold Uieu. anil on ttii' utiivr lu iImIuoUuiu frata the mamUb 
' Om tialloci o« llw frivaU bodies vho Uciud Uiatit. 

M. 8 



lU 



WJJULTH. 



niwK II. 
ca. It. 



Ctmno- 



of rigbto Ui 
wealth. 



ihu»i6 kiiida of literatim! whioh Inse their fftrcc by trnngifmon, 
timy be regarded as in a spijcial si'iisc the wealth of thoei> 
uatioua ui whosu lanj^age they are written. And the or- 
garnzatidii uf a frpR and well-nrdered State is oil importtmt 
elenieut uf national w4L>aJtlt, 

GosuoPOLlTAN WEALTH (HfTeni from national wealth much 
a« that differs from mdividual wealth. In rfeokuniug it. dL'bts 
due from nieniberx of one natiun to those of another nwy 
conveniently be omitted from both sides of .thy account. 
A^in, just a» riveni ore important elementti nf national 
wealth, the ocean is one of the most valuable properties of 
the world. The notion of coamupoUtau wealth is indeed 
nothing more than that of national wealth extended over the 
whole arcia of the globe. 

ludividnal and national rightct to wealth nsot on the basis 
of civil and interuationa! law, or at least of cuatom that has 
the foree of law. Aji (!xhau«tive investigation of the ocnnoinic 
conditions of any time anJ place requires therefore au iiKjuiry 
into law and cuiibom; and cconumivs owes much to those who 
have worked in thi.s direction*. But its boundaries are al- 
ready wide; and the historical and jiuidical basis of the 
couctptions of property are vast stibjocte which may beat be 
disciiesed in scpanttc treatises. ^1 

The main purpose of this chapter haa been tu InquirtV 
what classes of things arc to be included under the ttinu 
wealth: and the question what value is to be attcribod to 
any elenit^nt has boon discuascd only incidentnlly ; oa for in- 
stance where we had to reject from the inventory of wealth 
part of the value of a thing, on the ground that it bad been 
alroady counted, or for some other reasou. For thiu purpose 
private property has been reckoned at its exchange value. 
But the value of public property cannot always be no 
measured. No direct estimate for instance can bo forined 
of the value which the ThamRst has for England. As we 
shall see presently" the exchange value of a thing is a very 

■ lVri(eii»nr W>|pier. in pnrLiL-ular. lina Uin>iru mnch Usill •«■ tlw cuiuMCIiowH 
Ivlvrouii tlH> iJCuiMJinlo oancv[it <ii ffvalUi utd tfao JnriiHral raiMept «t lisbt* hi 
(iiivAW property. 

" Book UI. Cli. [r. (iikI (i1iMW1a«TS. 



ECONOMICS AMD JURISPRUDENCE. 115 

imperfect measure of the total real benefits which it confers : book u. 
it is aji imperfect measure even with regard to commodi- °"; "' 
ties in the bauds of private consumers ; a still more imper- 
fect measure with regard to railways, and useless with regard 
to such elements of national wealth as rivers and seas. 



8—2 



CHAPTEH ni. 



PRODUCTITB. 



nDov □. 

CII. Ill 
JiUll l-Bll- 

uotpcodoM 
inittU'r. bat 
only II II- 
litk-H ill- 
hijrrut ill 
Diallar. 



Tlie Imlur 

prodiwo* 

nlilitic*. 



§ 1. Man cannot creaW material thingSL When he is 
suiii to produci* material tilings, hi; n-'ully only jtruduces 
utilities. In the mental and moral world indeed he may 
produce nuw idt^u:^. But ill the [iliysical world, all that he 
can do ifl either to re-arrange matter so as to maJie it more 
useful. 03 n-hc-u he luakos a log of wood into a table ; or to 
put it in the way of being made more u&efut by nature, as 
when h« puts seed where the forces of nature will make it 
buret out into liff '. 

It is sometimes said that traders do not produce: that 
while the cabinet maker produces furniture, the furniture- 
dealer merely sells what li already produeed. But there iB no 
soiuntific foimdation for this distinction. They both produce 
uLilities.audneitherof them can do more: the furnilurc-doalor 
movpj* and re-arranges matter so as to make it more sen'ice- 
able than it was before, and tlio carpenter does nothing more. 
The sailor or the railway-man who carries coal above ground 
produeeg it Jiiat as much as the miner who carries it under- 
ground ; the dealer in fish hel^w to move on fiith from wh«re 
it is of comparatively little use to whore It a of greater use; 
and the fisheriiian does no more^ It is true that if there are 
more traders than are necessary, there is a waste. Btit there 

■ At Jfttnw Hill bus mIA, ■'Tlin diHtlnotlnn bctwMii what \» doB* bf labov 
nod wlint i* dani' b}' tuitDTu ii iiot ftlK-a:nt obaorrod. LftbOOr pt«4iHM ita •OMto 
oulf by vuiiBiBtcucy with Liiv 1b«i of usiiiii:. It b toutiil Uwt tliv nnvaey ot nu 
run \»c trnrecl U> vi-ry Nlnipli^ rImioniK, Hr. tloro nntliutu: but |iT«lnuc miition. 
Ub cui tuuit (liiii|,i tonniili (iu» auutbur. auit Le cui wptrotn llipiu tnia uuc 
Miotlti'r. Th'' iirn]H'rti<^ •>! innttnr pnrinnu tlin rvat," (SUmmli «/ /VififiimJ 
Xconomy, Ch- i.) 



HAN PBODUCES ONLT UTIUTIBa 



117 



b« 

I 



V also wftstie if there are two men to a plough which can be nnoi: n. 
well wurkod by uuv luiui ; iu both caaea all those wliu urc at '" "• "' ' 

k produce, though thev may produce but little. Some 
American anil other vrritcis hav« ruvivcj tht: lucdiiL-val 
attacks oa trade on the ground that it does not produce. 
But they have not aimed at the right mark. They should 
have attacked the imperfect organization of trade, particularly 
retail trade. To this subject we must retura 
§ 2. All labonr h directed towards producing some effect. [Je*rir kW 
or though some exertions are taken merely for their o\m iom^I«tjw> 
sake, as when a game la played for ainiistiment, they are not i'"^''^'*^'"- 
coonlcd as labour. We may define labuuh as any exertion 
of mind or body uudergoue partly or wholly with a view to 
same good other than the pleasure derivetl directly from the 
wod*. And if we had to make a fresh start it would be 
best to regard all labour as productive except that which 
wl to promut*" the aim tt>war(l» which it wbh directed, 
d so produced no utility. But in all Lh« many changi^s 
'hScii the meaning of the word " prmluctive " has undcrgono. 
it has had special reference to stored up wealth, to the com- 
parative neglect and mjraetime.'* even to the exclusion of im- 
medi&te and transitor)' enjoymeut*; and an almost unbroken 



> W* U imtuf (taflnitioci {Titary </ PolUiftd Kcenomf/, Ch. t.), Mccpt 
i bo iudndM ouljr ftitdnl ««rtwiui. But li* biniKlf pointa out licv,- pnkifiil 
ofUn b. Uo«l pw>lil» work mort tbiui tlivj wobIiI If llier cuuBiilerud 
onlr tlU dlrart floMnini rcaultinit (rnin tbo Knrk ; bal ui n licttlthy atotc, plcanirr 
j i nl ii i i ii Miw oitr |i*iu in • tcrtat pan vwu ot ihn work liM i* daiw tui liire. 
Ot ronrM Uia iMUiiliau in ctlanUf!; ku a^frifiUtitnl lulioiirur iroridiiB in hU 
pritn In tb« tvrolDg ililAka ctitelly of ihe Irnit o( bin lA^wora; a meetuude 
wt w iibn Iwma alter ■ da; of nodatitai; hul AaA» podlivo plounin) in bin |[anlMi 
work, but be Uw cana a good 4m] about tlic frnjt of Ma Uboor; iihilv a ricfa 
mail aorklaB b llkv EUimcr maj br abnoist ImliSpTviit to ibo rcaolt of nbnt 

' Thu* iliP IklvKatiUIItti «bo resanlnt Ifae pr«clonii iiielalH. inrLly lierauM^ 
tSuj Wtfe !in]wruliabl», mt wcallb in a Mlor icn» than Bnjrlhiii^ uUe. rrffitdoA 
am onpTtiilnriiv* or •'••■rile" all Ulmnr lli»l vKa mil ilir«<cl«l U> {iTwhmiag |,'(x"l» 
foi oxpwUtuni tu cMbauRo fm fioU aiid silver. Tbo Ph^'niocrat* Uuiiigbt 
aU labonr aUffla whUb coiuiuiiul an -oquul vuluu to Uiai nlik-b il |iroiliii-nI : 
xnd ngudld tke acrkiilUiriiil ax the oiily prodaclivo n'orltu', becanun Inn Inlnnr 
daw (aa Uwj Ihoo^t) Ml bebbMl 11 a net cnrploa ot ■lored up wliiIUi. Aibuii 
8nlth tttbmei doim tbo PhyKioernliG dcflniliaii; tmt stiU ho wmnder^'t thai 
i^hnriliira) lahonr wm mora {irodnctiTA Uian any otber. BU ftJlowcn ilticanlHt 
lUa (UrtiBctNii ; but \b*j liav« ^uoraJly bhUkniiI, tbooKb witli uiaDy Jiil«r<ijci(a 
Ib fvlnla of dotaO. to tb« iiotlcui tlial pn>dactiv« lolxiiu' is Uiat wbidi teuds to 



118 



PSODUCriVB. 



BOOK [I. 

CH. in. 
Bnt liM 

naivl [n bv 

■pci'iaUy 

jirnlanuvii 

wliii-J] |1IH- 

tin; Wlllltl' 

of tlii'tn- 
tnro rn liiirr 
tban tlic 



Tbo work 
cif<luiuiHitic 
•erraata ii 
not ttaow 
Mribrnu- 



ProdncUv* 
(•■tmul- 
tivu uljec- 
live. 



tradition compels QS to regard the central notion of the wr 
as relating tc the i»ovi8ion for the wants of the future rather 
than those of the present. It is true that all wholesonie 
enjo>ineiits, whether Iuxtuious or cot. are legitimate ends of 
ttctiou both public and private ; and it is true that the enjoy- 
ment of luxuries affords an incentive to exertion, and pro- 
motes proftress io many ways. But if the eflSciency and 
enei^y i>f imdnstrj" are the same, the tnio ijitcrcst of a coun- 
try is generally advanced by the subordination of the desire 
for immediate luxuries to the attainment of those more solid 
and lastiiiji; redouroes which will assist industry in its future 
work, and will in various ways tend to miikp life larger. This 
geiieraJ idea has been in solution, as it were, iti all stages of 
economic theory; and ha* been precnpitalwl by diiferput 
writers into various hard and fast distinctions by which cer- 
tain trades have been marked off aa productive and oertain 
othere as unproductiva 

For instoncc, many writers even of recent times have 
adhered to Adam Smith's plan n( cluKting domestic servants 
as unproductive. There is doublteas in many large hounes 
a Nuperabuudance of servants, some of whose energies might 
wilh advantage to the cummuriity be transfunrd to some 
other direction : but the same is true of the greater part 
of thoBt! who i;arn their livelihood by distilling whisky; and 
yet no economiiit hius prnponed to call ihcm unprmiuctive. 
There is Qu distinction in character between the work of the 
baker who provides bread for a ^rnily, and that of the cook 
who boils potatoes. If the baker should be a coufectiouer, 
or fancy batcer> it is probable that he spends at least as 
much of his time aa the domestic cook doee, on labour that 
ia iinprochiclive in the piputor sense of providing tranritory 
and unuL'Ci'asary enjoymenta ^M 

ThcTti seems to he ii way <if escaping from most of these 
ambiguities and confusions. It would indeed be unsafe 



» 



inoTdaw ftcoimiRUln^ wmUUi ; a noHim vhlrb la bniktlMl niher than lUted In 
c«I»bnt»d chajiter of T^r H'eallh t,f Katinnt whiRb bean Vkt ti11«. "On tli» 
AcoBiinilatiiiu u( CB|>ital, ur uii prwliictLT* wnl aii|>ro(IuctSvi> Laboar." {CcMip. 
Trmrcsa Twl», Frofixn of PoJiit'ca! Economy, 8vcl. n., and the jUmnnalnnn ou 
the word Prodaellrp In 3. 8. IAU'h Ftmii*. uiil tu Ma Pnntiple* of FeiUienl 
Ranomg.) 



PBOVISIONAL DKHSmOX. 



li! 



■ 



I 



iDTeut a iiiimbor of now terms tt> correspond to tht? %'arioiie 
list's of " pnxliiclivt^" But rucolloctiiig that it is a transitive 
acljcctiv(>, we cau avmd all difficulties by the sinipii- plan uf 
cousidering what U the implied substantive which it governs, 
and Biipplyiiig that substantive explicitly. When it m&ans 
productim of necesmriets (to a[itici[>ate the use of a berm 
which we are just ahout to define), let us write in the phrase 
at length aud the ainhigtiity dlsap[}ears; when it nieanft 
jtrodiictive of capital in any fomi, let us say so; when it 
roenns productive of accumulated wectUli in any form, let us 
say nu. 

But while frequently applied in each of these senses, it 
ia Mill more often used to ineau Productive of Ote means of 
production, and of tastiiuf aources of enjoymont Whenever 
we nae the word pBODfCTlVK hy itself, this is the sense io 
which it ia to be understood. Among the meaua of produc- 
tion are Iiic-liuled the necessaries of labour but not ephemeral 
luxuries ; aud the maker of icee is thus classed as unpro- 
ductive whether he is working for a pantry ciiuk, or as a 
it« wrvaDt in a counti^' house. Out a bricklayer en- 

■d in building a theatre ia classed as productive. 

No doubt the di^iding line between permanent and 
ephemeral sources of enjoyment cannot bo drawn rigidly. 
But this is a difficulty which exists in the nature of things 
and caanot be evaded by any device of words. We can 
spuak of an increase of toll men relatively to short without 
deciding whether all those above Ciw feet nine inches are to 
be classed as tall, or only those above five feet teiL And we 
con Bi»eak of the increase of productive labour at the expense 
of unpniductive without fixing on any rigid, and therefore 
arbitrary* line of division between them. If such an artificial 
lioe is required for any [larticular purpose, it must be dmwn 
(ixplicitly for the occasion. But in actual fact such occasions 
seldom occur: it is porhAps not too much to assert that they 
never occur'. 



OOOB tl. 
CK. tit. 

I'i.iitJU IB 

t)i« iinpllnd 

niitnaaiiUvvi 

(■LEIIHt itV 

KU|>|)Ii«i. 




Ehrorimoniil 
iloSaitiuii 
of pmitHr- 
lin. 



IbcrcU 

iiohsH 
ftndfut 
tjiiu «( iti- 
vMem lit 
Katorc uil , 
mMMam 

wuit an 



■ 1%a BtUmpt bi Snv a hanl tii4 (*iit Unn nl dlatinctlon <rber« UiAr* ta m 
rati diacmitunritj' in luture liaa often <k«iv toorc mUcluof, bat hu pMliapt 
iM«er lad to mum qnalot mnlie, tLau lii Uic riniA ilclluiiiuuH aliioli Uare faocu 
■ «««< l iii aa gltcn ol Uii* l«nu producCivo. Soma at Uimn for Inataim laad to 



120 PRODUCTIVE. 

BOOS II ^^ conclosion that ft Binger in ui opera 1b nuprodnctive, that the printer of the 
CH. in. ticket* of admiuion to the opera is productive ; while the usher who tihewB 

pet^e to their places ia nnprodactiTe, onleBB he happens to sell programnieB, anil 

then he is prodnctiTe. Senior point« out that " a cook if Dot said to male roast 
meat bat to drea it; but he is said to make a pndding. .. .A tailor is said to male 
doth into a coat, a djer Is not aaid to make nnd^ed cloth into d;ed cloth. The 
change produced bj the djer ia perhaps greater than that produced bj the tailor, 
but the cloth in paaaing throogh the tailor's hands changes its name ; in passing 
through the djer's it does not: the dyer has not produced a n«w name, nor 
conseqaentlj a new thing." Pol. Econ. pp. 61 — 2, 



CHAPTER IV. 



KECESSARJES. 



§ I. Nbckssaiues are those things which are necessniy 
inif purpotM! ur othi-r; unJ bL-musf diflutviil writers hiive 
I' in their rainds different purposes, and have not alwaj-s 
explicitly stated what they are, the term luw caMfwl great 
>nfiisio». Thus the cast- of this term ii onaJo^ud tu that 
9( the term productive: tach has boeu used elliptically, the 
ibjoct to which it refers being left to be supplied by the 
lor ; and since the implied subject has varied, the reader 
'^lias ofteu supplied one which tho writer did not intend, and 
thus raifiundentuud litH drift. Ju this, ax in the pruaeding 
eaee, the chief »o»rce of confusion can be reniovod by sup- 
plj-ing f-xplicilly in ev^ry critical place Llial whieh the reatler 
is iiJ.ti.'ndod to iiiiden>tand. 

The older use of tho term " ueceesoriHs" was liuiit«d to those 

liings which were sufficient, to tenable the laboiircm, takoii 

ae with another, to support themselves and their fiiiuiliL'^ 

kdam Smith and the inon! careful of his followers observed 

indeed variations in the standiinl nt" comfort at differt-nt 

len and pluceti: they recognised thai difitTL-uceH of climate, 

lid differences of ciuitom make thingH necessary in some 

s, which are superfluoua in others But Adam Smith's 

9W was much indiicnced by that of the PhysiocratM, and 

Ecasouttigs were based on the condition of the French 

»ple, in the eighteenth century, tlau gn«.t inaNs of wliom 

d no notion of any necessaries beyond those which were 



BOOK II. 

vu. i». 
Thetona 

•uia alao 
U«llip(ji!itl. 



DU-JMi fur 

niid unCDil- 
H»H(« fof 



1^2 



NECESSARIES 



»VOK It. 
CU, It. 



Aotoanl 
matllw 
lakaaof the 
MniiDtlimii 

i)tli]ii<>ea)ji1 
tiuii- mill i>t 

4>r ]ii-i»e. 






required for mere udstcnco. In happier times, howov«r, a 
more careful analysis has brought into promiDence the dis- 
tinction between the nccessaricB for efficiency wid the neces- 
sarit* for oxisltUL-u, and ha« made it evident that there is for 
each rank of in(hi»tr}- nt any time and plitce a more ur less 
clearly defined iocome which is necessary for meroly sustain- 
ing it« tnembeni, while theru is anuthtfr and larger income 
which is necessary for keeping it in ful) efficiency. 

Thus in the South of EnglanU populatimi has increased 
during the present century at a fair rate, allowance being 
made for mignition. But tlie efEcieucy of labour, which bi 
earlier tim^H wns as high a» that in the North of England, 
has sunk relatively to the North; so that the low-waged 
labour of the South Is nftcn dearer than the more highly paid 
labour of the North. This indicates that the labourers in 
the South have bad the bar(> nece&<«arics for existence and 
the increase of nuntbers, but that they have not had the 
neceasajii;» of efficiency. 

It may be true that the wages of any induetrial cIbbb 
might have suftitsjd to niaintftin a higher efficiency, if they 
had been spent with perfect wisdom. But every estimate of 
necvasuries must be relative to a given place and time; and 
unless theru be a special interpretation clause to the contrarj', 
it may be afanime*! that the wages will be spent jnst with 
that amount of wisdom, forethought, and unseltishness, which 
prevails in fact among thfi industrial class under discuwdon. 
With this understanding we may say that the income of any 
clafiM in the ranks wf industry is below its necessabv level, 
when any increase in their income would in the coarse of 
time produce a more than pro]wrtiouate increase in their 
efficiency '. 

I tl Kc coDiiilcir wt indiiidiul ol csooptinvkl aMitiai, &I1 hi» tonmnptkin U 
dtiictl? pioduL'tivc uiiil [iL'GFtibfti?. to loii|{ M bj caltlcit oR any part ot tt, lie 
woald tUinbiiih hjii nini-ieairy bj nn MBKntnl tliAt in n( raoiv rval value W U» VT 
ttie real ot tLo warlil ihui be Kavnl troia Ll» iwn>um|iUaii. I( » Nrirton or ■ 
W*lt cflnM haiw mlilnl d buiiilrcitUi put to lui «akii>ac:r by doubUnii Ui per- 
fODft] erp^nifUtnrp. tlin ini^mnan in hlH oanamfUmi wnnld liavo bom trnly pra- 
dnetirc. Ai wr iiliall aoe Mat uii ini«li > mm ta utUuRtnu to ftddlUonal eolll- 
i«lli)ii of rioli Unil tliat Witrx « binli runt: it i)iit,v tw jiruflulili^ lbi*ii);]i tlia nitnm 
to U is lc» tliMi ill iicopu'rti'gu to the prcvioas outUy. Ou tbe albvr Iihii) wlwu 
Uie euiiiDKV ot au iiulUBlria] rlnn are alKuly a lair tniiMBim ol Um serrfMa tliat 



TART FXOK O^'E OOCUPATIOK TO AKOTUER. 



§ 2. The necessaries for the efficiency of an orflinnry 
Bgriculturnl or of an unskilled town labourer and his fauiily. 
in Eiijfland, in this generation, may be fsaid to consist of a 
well-timiniMl dw«lling with eevcral nM>In^ wann clothing, with 
some changes of nnderclothing. pnre water, a plentiful supply 
of cereal food, with a inodL-mtt* allovrancL- of meat and milk, 
and & little t«», &c., some education and some recreation, and 
lastly, sufBcient freedom for his wife from other work to 
enable her to perform properly her maternal and her house- 
hold dutiea If in any district unskilled labour is deprived of 
any of theao things, its efficioncy will Miffor in the same way 
Bs that of a hofwo that ia not pmjwrly tended, or a steam 

[engine that has an ina<Ic(|nate supply nf coals. All cod- 
euiiiptiou lip to this limit is Htrielly produotive consumption: 

i*By stinting of this cunsimiplinn b* not economical, but 



BOOK II. 

oir. IT. 

Thfiv U 
ntivu uif 
mil 1108 lifMi 

UlAU in IID* 



Tn <"^^1it^ffl1, perhajM, some cnnNitmption nf alcohol and 
tobacoo, and iome indulgence in fashionable dress are in 
many placeis mo habitual, that they may be said !-» be con- 
ventionally SECfSSARV. Bince in order to obtain them, the 
Bveragt; man and woman mil sacrifice some things which are 
neoe«eary for efficiency. Tlioir wageK are therefore less than 
are practically necassary for efficiency, nnlewt ihcy provitte 
not only for what, is strictFly necessary or productive conftump- 
tiou, but nl*o for a certain amount of conventional ticccssarits. 
But of course if it were the habit of the country that the 
family should do for thcniwlvi-s. pniprr time being allowed 
for it. things which the English labourer generally pays to 
have douv for him (such as baking tkeir own bread, or 

ting their own clothes), his neceasary wages would be 

ainiahed by a corresponding sum. 

Tbe strict necessaries of the uu!>killed labourer who has to 
do Austained and exceptionally exhausting work, inchidc a 
large supply of animal food. Those of the skilled labourer 
include generally a good deal of animal food, more education 
and mortt recreation than those of the unskilled labourer, and 



C&nren- 
tiimal mt- 



Diftrrriil 

RlflllU' 
llBTP (111- 
(emit li*. 
nmariui. 



IbcT mdw to tbf conRinnltx. an;- tiirtlinr tnnvtiiit at tbeir in«in)o InvalvM ■ 
ifal burden t« llie muuiitmit; wIidd it kt^m* to bring nlUi It proiwrtloDRU 
tofww of Uwte tfldoBcy ■ TUi tatt la vair I>ii|'<JrUi><> >' ^^ ■PP^v hsrotftvi. 



IM 



NECESSARIES. 



isr."- 



Mm J InaD 

thefilacc 

□flew 

•spnuivD 

IMOMW- 



Iiifl canv«ntinna] neceesaries are considerably greater, 
ticulorly in the direction of dress. A^u it is noccssar)* for 
the efficiency of the highest ranks of incUuitry, including thai 
professional claseos. that they should havo food of the moitt 
easily digcKtiblw kiuds, house-room suffieiout fur (^uict, some 
travel and change of scene, hooks and other implements for 
thfir work, and a very fjtpemive vdut-atiou. All these are 
nBcessarit-H strictly so called: the consumption of them is, 
prwiuctive: tn abstain frmm consuming them is wastefiil. Ini 
addition to ihusu there are many conventional necessaries, 
which in the present state of society, no indi^-idual can dis- 
peuse with, without a risk of losing social influence, and 
perhnpfl indirectly impairing liis efficiency. But society aa ' 
a whole could, if so mladed. dispense with a great part of 1 
them without iiijuring itw L-thcicncy. And perliaps more than 
half of the consumption of the upper clasees of society in* 
England in wlmlly unneccSBary'. 

Many thiiiga which are rightly described aa Buperfluo^is | 
luxuries, do yet, to some extent, take the place of necessaries. | 
A dish of greca ftQas in March, costing perhaps ten shillings, 
is a superfluous luxury; but yet it is wholesome food, and ^ 
doee the work perhaps of three pennyworth of cabbage; OTifl 
even, since variety undouhtedly conduces to health, a littlo 
moro than that. So it may be entered perhaps at the value, 
of fourpence under the head of neceasariea; and at that 
nine shillings and eighcpenee under that of superfluitiea. In] 
exceptional cawes, as for iiwtance when the peas are given toil 
au invalid, the whole ten shillings may be well spent aiui 
tsproduce their own value. 



■ For tbe lake of fiiving dt'SnitcnMs M ihe litta It may be ir«ll to TODlan M 
pdiiualvii ml nocoMarica, ri>iitili unl tfuiiliuii iu> lliiiy timiit tiv. PiirliAjw at ]irfa*ut J 
|>ricca tlio irtrict uiTDBsariw for sii B*cr»g« agricultaral fwuilj bh covcrtr"! by 
UleeD or ol^blocn •liUUnm n wwh, tliu m»TGiitian»l ncoMmrlM \iy aIxiui five 
(hUlln^ incini. For the nnaldlUwl labimrur In tlio town » tfw BbUliiiHii mut b« 
kil'tnl 10 Ibe strict iMMWSMirlfic. Fur tlia fitmily of thii KktHw) Korkniaii livlnR 
in n lonii, wa nwy take Iwciitj'-Sro or Uiiri; laiilliiji^ fj>r lUrlct mwoBari** *bA 
t«a iliilluiKa (or coiirt-iitiuiml iin'ttwHTirH. Fi>r r man whoM tnaiii hta lo tuiib 
Itrtni continnoiis ttnia lUc ntrict dcccwBiiuK an porlupii two ImiiilKid or in 
bniiclml itiiil ally ii-uuuiU a yrta ii liu ia n IiarlitJitr: linl uivtv Uiau tniM 
much If ho liM Dii ripniiiivc (ainilf to mlaostc. Hii cotiniitional new 
iltpuul on the uKtum of liia enilUif . 



KAN CONSUMES ONLY UTILITIES. 125 

liEistly we may notice that just as man can produce only book ii. 
utilities, so he can consume nothing more. He can produce °°' " ' 
services and other immaterial products, and he can consume M»n <»n 

0011H1UI16v 

them. But as his production of material products is really m he cu 
nothing more than a rearrangement of matter so as to give ^ nH* 
it new utilities', so his consumption of them is nothing '**'*"■ 
more than a disarrangement of matter, which diminishes or 
destroys its utilities. 

> See above, Cb. til. 1 1. 



CHAPTER V. 



CAPITAL 



nonN II. 

CB. V. 

TkeUmu 

niBnydlf- 
Itvvnl BsM, 
Wi> iiiay 

mil vfwi un- 
til i]ivi«[jl iL 

lerui lor 
111 



Ailuu 

IIM of the 



mpiltU in- 

■■ItuIiib 



§ 1. The term "capital" has many widely (Hvei^eDt 
UKL'S botli iu thf IftiigiiagG of the market -plact! and in the 
writings of RcorigniistH. Then? is tio other port of ecoDomics 
in which the tt-uiptation is so stroug lo invent a completely 
ufw set of tt^rhnical ttriiis ; each of whiich should have a pre- 
r:Ue aiid fixed ineaiiiiig, while between them thty tiliuuld cover 
all the variouK si^iiHcaiions which are given to the one tenn 
capital in the language of the mark ot-p lace. But thin would 
throw the science out of touch with real life; and academic 
esacttiesB of lo^cal form wuuld be ul>laiiied at the cost of 
grave snbatantial injury. Wt; must therefore take the ordl^J 
nary usages of the term as the foundation of our aceountj^ 
and add such general ux}>lanatiuiiH, and even in i^onie cases 
such Hpecial interpretation clauaea. as are reci«ired to give 
to oiir DSC of bile term Home mcamin; of clearness nod 
prL'citdou. 

Adam Smith Kaid that a pcnoii'8 capital is that ]>art of 
Ilia Htock Jrom which he expects to derive an income'. This 
account ia consistent with ordiuary usage »u long as vre 
regard capital from the point of view of the indi^iduai ; and 
we will confine ourselves for (he prcBcnt to that, leaving the 
diKciisaioii of Social capital to a later stage. We may slightly 
modify Adam Smith's phrase, and wiy that iKDivinrAL 
CAi'lTAL is that portion of a person's external goods by 
which he obtains his livelihood (Enoerhamitiet). 



' tl'cu/M o/AWhih4, Bookiv. Cb. 1. 



ISDIVtDrAl. CAriTAL. TRADB CAPITAL. 



1S7 



The luoet ciJMpicuous elements of iTidividiiol capital «re 
'aucb thiugs as the fiictory and th« business |jiant of a niaau- 
faccurcr ; that is, bis machinery, hut raw material, aoy food, 
clothing, and bou^-rooiu that he may hold fen- use of his 
«np1oy^, and tht; goDcIwill of hu buifincssi, at all events iu 
80 for as it Ib capable of being sold to bis successor. Hore we 
include all thiugn which are tt-t out im hire, siirh as hntises, 
carriages, and sewing-niachiDeti. all wealth or oouiiiiaucl over 
wealth which is let out at interest, whether in money or 
in any other form ; whether leut to help people lo establish 
themselves in biiFiitieNH or to indulgt- in iiUe and injiirioiiK 
diaaipatioa 

These are iustaQcus of ihtngx from which their owner 

'expects to derive an incume iu the special Ibrru of money. 

It is uo doubt ver}' convenient that i'hi» group of thiugs 

should have a oomiaou cliuut nuiue. But they do not con> 

alitute the whole of Individual r^pital, and we mu.iC not 

apply the term "capital" tumply to tbia um;, except where 

them ia no danger of misuiiderstaDdiug. The central 

notion of this grouping iii that the things are used for 

|.tradu purposes, aiid this notion ought to be expressed by 

leir name. We may then dcHne a person's TllAoe- 

CAPITAL to couaial of th(.ise cxtenial goods which he uses 

■in his tnuie, either holding them to be sM for money or 

ippljiug them to produce things that ore to he auld for 

Under this beiul are to be reckoned fancy ball 

that arc let out for hire, but not the house iu 

a frugal working iiiau lives if be happens to own 

himself; ices in the bauds of a pastry cook, but not the 

'storu of wheat for his own use which a mau bus grown 

^«ti his allotment; and not eveu the sowing-machine with 

rhich hia wife make clothes for the family. 

The habit of reguixling as of special importance that part 
a person's income which comeK to hitn in the form of 
3Dey is a Hurvival of the prejudices of the Mercantile 
iystem; and in the Ibllowmg chapter and elsewhert? we 
il be a good deal occupied with the attempt t.o free 
elves from its misleading influence, and tognmp together 
lings that are substantially of the same kind even though 



aoon II. 

CO. 9. 

Tradv 
cuplul. 



Tliat (art 
of cspitftl 
from wbU'h 
I, iniuiar iii- 
ciama h ■!•• 
rived ma; 

TnJt 
eajritnJ 



lia 



CAI'raAL. 




noox II. 
en. V. 



Elvinciitx 
Of I[iili- 

vidiinl 

»r* not ui- 



cluileil ill 



Trode- 



UMTboe 

natiuc u« 
tn belu- 
Dlucled ui&r 
bo left 
opnll. 



ftwial 



flomt! of them are, and olhtrs dru not, dothed in 
of money i)ajni<?nts. lyeAving thou Trnde-oftpital for its own 
special uses, and ihey oro not uiiiiuportant, we will go on to 
complete our account of individnnl cnpital 

Tu do lliis we have siiu|jly t« add tu Trado-capital all 
thrtiie things which are required to enable a productive 
worktjr to do his work and earn his livelihood, whether 
they are in tiis owu pojwessioii or not, whether he derives 
beuetit from thorn directly and without the intennediatioD 
of money or not. Thus it includL-s a niaiiufacturcr'd aUire of 
necessaries for his own living and efficiency as well as those 
for the living and efticiency of hifi wurk-i>eople : they rk 
part of the means by which he earns his livelihood. ^M 

A person's ctijnla] is most commonly taken to includ^^ 
land aiid other free gifte of nature, at all events if he uses 
them directly or indirectly os a means of earuijjg his liveli- 
hood. But even in ordinary convereation the "rent" which 
he durivus from them la sometioies separated from the 
"interest" or "profits" which he de-riyes from hia capital. 
For w>m« purposes it is convenient to include them, forolhere 
not: the same writer will — whatever his formal definitiou 
be — ollou iucludc them tu some parte and exclude them in 
other parts of his reasonings. On the whole it seems beat 
to be bold, and <la this openly. Thus then the question 
whether the free gifts of nature which are in any person's 
ownership are to be counted as part of his capital, is left 
to bo decided by an interpretation clause in the C0Dl«xt, 
wherever there is room for miHunJeratanding on the point 

Wo arrive on somewhat surer ground when, leaving the 
discussion of indiindtLil capital, we ]mss to consider tt from 
the }wint of view of society. 

§ 2. We have already noticed that national wealth stands 
in the Kame ri^lation to cosmopolllaii, in which individual 
Wealth does to national : and ho with reganl to capital. Hut 
we may here coui^ue oiuselvta to the ductis-iion of social 
cajiiial, of which national and cosmopi^litan capital are special 
instances. We must recollect that as the older term national^, 
capital represented not that capital only which is the comfl 
mon property of the nation, but the aggregate of the capital 



SOCIAL CAPITAL. 



12t> 



vhtch the nation poneseeK whether in public or pHvatc 

owaerehip ; so the more tnodcru term social capital iudicat«8 

the aggmgate of the real capital, private a» well lui; public, 

^■Mrtted by the niciubem of aiiy fociely which is under dis- 

^^BLseion. 

^H For this reason, boutid&riefi of private rights of property 

^B» not much trouble us heru. The debts aad other obli- 

^^»tions from cue growp of pcisons to another enter on 

both the debtor and creditor eidos of the account, and 

destroy one another, as sooa as we count up the resources 

of a nation or other society which iiicltid&i bolh group5. 

Moreover the usagea of btuduetis life are lu this i;a»e letw 

fronblesomej because while the sociftl view of capital is the 

more iiiiporlant for tht? general purposes of ecouuinies, it 

plays a less promiiicut part .in ordinar}' disooiirse. Thus we 

are able u> be guided more Btrictly by purely economic* 

^■ponsiderotions ; to exclude wiThout hesitation the free gifts 

^V)f nai ure ; and to regard liocial capitjil us eonsisliiig of things 

I made by toankind as rosourcee wherewith to meet future 
noeda 

' The first <|ua!ity of social capital in its " proepecliveuess": 

II o n thai all writers are agreed. Th^ second, which nearly 
^mU concur iii assigning to it. is that of asBiBiing society in 
^^wming il« livelihood*, that is in production: for while an 

iodiridiial may ubtaiu his livelihood Irom others by a course 

licfa does out odd anythiug to the prtxiuction of wealth, 

f-contained nation or other ivocial group can add to 

leouA of livelihood ouly by an excess of production over 

consumption. 

The histories of the terius "productive Ubciur" and 

'Capital" are closely allied: prociuctive labour and capital 

have alwav's been regarded as devoted to providing enjoy- 

itaad the sources of enjuj'ment for the future rather than 

the pnaent. Some enjoyment is iudeed derived from the 

impiioD of the nvceeearies of life which are included 



BOOK n- 

OB. T. 



intL# 

of ■ llftttWI 

filratluir 

KDoletrcaii 

be ileluitiil 

0)1 M'jr* 

Vutdy 

•Tommnlc 

liliro lliaij 

Uiut in Uut 
mruoratiiii 
of on ludi' 
t-Uual. 



Two BttK- 
lintm of 
njiital ; 



Itipiv 

«p«otfr»- 

iiraa. 



* Ooapw* IW •eoooul of W»ffiia''a poaHimi tb tha iiDto at Ih* end of Uiu 



OoiLpuc (be QDoUliiMi bam S««liii)*IlaTvrk in tlK< iK>t« it tbe *tii1 of ili^ 
etol>Ur. 

M. 9 



130 



CAPITAL. 



BftOICIt. 

en. V. 



uiiflor capital; but they are counted m capital Wcause of ch< 
wfirk fur ihy futuro which they suable people tu Ju, ajid uol 
on account of the present plea»iire which they afford Thus 
capital is said to be the result of saving, of a jiamficw of 
present enjoymmitji fur the sake uf future; and it is chitfly 
for tliis reason that economists exchtde from capital lu ite 
pure economic sense those iwv ^ifts of nature which have 
not beea made by man ; though they include the value of 
the improvements which man hm added tu the natural 
refioiirces of the land. 



lU proline- 

tlTetlCM. 



M 



Ufliiiitiiiii 
of SM>iai 



ttrmeapt- 



an4_ 



While then all ccouomisLs rej^ard prospcctivciiess oh ai 
essential attribute of capital, the majerity of them insist 
alwj on its productiveness ; and call nothing capital of 
which it can be said that, if it wcr« taken away, the world'" 
work would go on with equal cfticieiicy. Skill and other 
kinds of iut'Orual wealth which contribute directly to the 
production of matorial wealth are omitted ; but business or- 
ganizations arc counted in at the valiio of wlint they add 
to the efficiency of production'. m 

Though the matter is one on which opinions may fsJrly 
differ, it seemm on the whole best to atlopt this potiition, and. 
to combine the two notions of prospectiveness and prodt 
tivenetiB iu our standard dotinitlon. 

Social capital mn.y thus be defined as consisting 
those things mode by man, by which the tiuciety in tpiestion 
obtains its livelihood ; or, in other words, as coiisi»tiu^ of thuHe 
external goodM without which prodncliou could not be carried 
Ml with e(|ual efficiency; but which are not fn-e gifts of 
nature. It consists firstly of stores of commodities provided 
for the siwtcuancc of workers of all industrial grades: and 
sccondty of raw materials, of machinery, and all other aids 
to production. ^| 

Tlie first group may be called CoKStTMPTlON CAPITAL. Tt 
conirifltM exclusively of such goodn as food, clothing, honsc- 
room, £tc. which are in a form to satisfy wants directly. Tha^| 
is, it consists of (foods uf the first order*, vi cotistnnpUon goodt ; 

> Tbv ralatiiiii ip wljitrli oirititl nlnncls t(> mciuojr and cTfA.lt iiMf be 
ficiiorally nil Ibr |i1nii iiiitirjiti'i! sbnie, Bixik n, Cli. ii. 1} 4. Unt it iiivi>lv*> 
(lifllciilt imililrDiiiii wUt^li will rninire our camriil Kttentiaii at r latM ttsge. 

> 8m aboTo Ob. II. I 1. 



r AKD AUXn.URY CAPrTJ 



131 






but it does not include the whole of them. For thowj goods 
which &re destined to be eiii]!nime<I without adding to ihu 
ofticiency of production, are not to Ijo regardoil na capital, 
wbon they are in the handa of couaumBra. Th(^ food, kc 
which is required for children whn are growing up to he 
worki'ra. ia t<i b« included here. 

The Recond group nifty be c«IIed Auxri.lARY capital. 
t coonsts of all prtxfuction goods, or in other wohIh of all 
floods of the second and hiffker orders. Since raw niateriiUx 
mud machineiy are alwa^'H coiint(>d as prrxliiction capital even 
though they be devoted to making sxiperfliiities, this con- 
cession w-'fOis to require ua to go further iu conformity with 
usage, and to include also stocks of luxuries in the hands of 
era. 

That pari of consumption capital which goes into the 
of hirud labourer!) may be n^^rded on wage-capital 
vo the ftocial point of view. But it must bo recollected 
at wage-capital, so defined, and auxiliary capital do not 
litute the whole of social cupilal; there remaiu the 
of the higher classes of industry. On the other 
d we ought not, strictly spooking, to include undtir wage- 
pital the luxuries as well as the uecessoriee of the wogo- 
receivers; ao long, that 1.1, os we are regarding capital from the 
xociftl [>oiDl of view. Much error has arisen from the assump- 
tion, into which some writers have glided from a cnrclcss 
irae of the term wage-capital, that the necc-eaary consumption 
nf the lower ela!5«'s of industry stand.'* in n. ilitfercnt ri^latioii 
to uBtional capital and natioual produciiou from iht* iigcgh- 
sary consumption of other workem'. This is, for practical 
r[X)ses, the most important correction which it seems 
uiutc to introduce into the ordinary detiiiilious of capital. 
It w scarcely requisite to remark that, a» In the case 
•if wealth, tltere are many thiiigx, suck as roads, bridges. 



noon It. 

cn. V, 






We aia*( 
inelndii llw 

raxiva vt 

ot lliclcwn- 

gnAim of 
[iiilusury. 



Out dcA- 
nitioiM «l 



> 0( nmrw then 1* « triatft ai ilaliaiiittiliE' kdmiuI nt tba in&rEin ol esrii 
A Itetorjr ia tuiliary (wpitai airoplyt * wcATBr'a cottage iu wbtoli bv 
Ui trt^ i» |«rt]7 MiiUMry luiil ptilly oMmunpUnu capital. Thu priiKU- 
R«]liiwko«ae a( a ricb nan «D||ii|{ed iii Inubiai 1* contiiinpUoii copluJ lo tiio 
vUeui ol llMt scoMBiiMd«llMi wLlcL dJraclJjr contriliulrB tu llic Lealllj uul 
-*%*— T a' UMMeU rmI hli tamilj: Iml Wj-onil iliai. it ipi iiiit rnpllal ni lUl. 
to llw tH d lb« imra wUfli «» ara ailui-tliii-. 

9—2 



132 



CAPITAL. 



BOOK n. 

CM. 1. 

Indivldnal 

in Kcnenl 
lunooii}'. 



Somewrt- 

UieinMu- 
ing nf Ibc! 
tonn «o M 
toitiidQili? 
vbat ve 
nujcail 
Pettntiat 
eapUat, 



■ndMiino 
•VOTi mi>li(i 
II sL moai 

ri*cwUb 



arwl the organization of the State, which are part of captti 
and are important when capital is reganJcd from the point 
of vit;w of tht iiatitiu ; but which it is uot uL-ccssajy ro men- 
tion when comparing one person's capital with that of his 
neighbour; uud which tliuTL-fore often drop out uf view in 
entiiiiating individual capital. 

Wheu our standard definitions of iiidividiml and eocial 
capital arc compared, it will appear that tht^y art- in general 
harmony mth one another; thougii uaagc does not allow uft 
to make them absolutoly coincident*. fl 

§ 3. But while the majority of writurs adopt the «oaiw 
which has been followed in our standard delinitioDS of capital, 
others extend itt limitd, so as to iuchido not ouly all things 
which arc destined to promote production, but all things 
which are capabJe of being so uBed. Thus for instance they 
include all the stock of grain in a country without inquiriof^ 
whether it ig l*i be used in feeding people who work <M" 
people who livn idly; whether in feeding cart-horses or race- 
horssR In short they include what is potentially capiui 
according to our definition or welt as what is actually capital. 
This broad use of the term ha« its ad\Tuitage« ; hut on the 
whole it «eenis best to take the narrower as our stjiudard 
uge, and to have recourse to the phrase potential capital 
when we want to refer to the broader group of things. 

Some writ-crs go even further; aud laving stress almost 
exclusively on the notion of " pronpectivenesii " include under 



I Kii gnml Iniubte or I'OiLtfUiiuii i.i tDimod liv ilir (ni't llint Uic^ ininu at IbdiI, 
•rithnat altnniug (nr ituimivRmunU. niiil nf oUiat fiv.>> fiith al nalDr* in |;«u«iMU]r 
Hclu'lt^l fToiii Bucial tai'lUI and iuot(r often JiicladHl in Lidiiiiluil ca)'ital. Uo» 
difflcnlt.T Dii|;Iit Uavi- fti-iFL>u fri'iu tlic Imbit u( lecktruiuK a tradcr'n Mtadt of npcT- 
ftoitin HB |iait uf bU rapltAl. If wr liad ni1biTr«i1 to wlinl tpptisn ml tt*\ wigbi tbe 
natural mnnif <if uxcliuliiij; iliFiu Iruiu natini cnpital. But tlic uuiirerial lialiil of 
iucluiUnB utiiicT i-yeM cai'itAl atl rnn- inati'rintii uiiil niii'tiliii''^'. *vrii If tiwf an* 
dmmI *i>1i'Ij' til roakliig mp^rfluitiM. han brouglit about tli« mTill lliat li<Bt logi«al 
liicowfritttciicj in iiiv<jli-cil lij iticlu<liii|i tr»«!<ir«' iitiii^kii i>l "Uiwfflirilii'* in tttiiitX 
cuplM lluui hy cicIikUuk Ui«iu. Nor ilo«> anj nal ilUUtultT nruo frcdn ibe bet 
lliat vlwn «»allli i* Iniit In a K^VDnitrictit ur a ii*ti«>" **^" ""^ '^ uiiimxtuctivelT'. 
Uieleiiikr i-oaiil* tbal wealUi a* part nT hia capitaJ; wliilr >-ol il doMiMtanwar 
In thn inr«t)ti)t7 of soda] fajiilal. Fur iiH;;alive cagiilal to llui ■numnt at Uw 
loan tnaf bo «hat(»it to tha arc>innt of tlir buirawir : and ttiU oovne b liaHhiaily 
ailo}>t«i V7 Ihwo n-bo aUnupl lo oipTcw iu luatboinntiMl lona dootriuM Nlatlng 
U} tiic qnaiitit7 i>l cnjiltal. 



BHOADER AND NABJWiWER DEriSlTIOSi 



eapital all c-xt^niaJ ^uixl« which an.- nmde hy mati and 
*»Ted" Co become thi: sources of fiit-ute cnjiijment 

This divc-rgeoci' as lo the uae ol' the terai capital is due, 
a» baa been already retaaHted, to the fact that uconomibta 
may Dot ventare to invcat for thouwulvc^ a tcckoical tcnui- 
Uology todepeiKleat of the orduuu^' language of btisiuetis. 
Thinkers who arc agreed oq all substiintial points, continue 
to differ as to what is the leaet injurious method of eflectinj; 
a compromifiii betwocti scientific conBistency and popular 
tuoge : oud as to what urraagemonl of thv fuw icnns at iheir 
disposal wiil best eke out tWeir resiuiives. The divei^nee 
hu been a j;reac Htiiiiibliug- block to maiiy i-eodcre of 
tiConomicR; »o great a variatiou lu the use of 9o pruininviit 
a tenu appenrv Dt«(?««arily to land the science in eoiifmion. 
But in fael the dilBcuUy is much liAw seiiuus than it Mttmn 
at fint sight 

For wheihiT a writer takes a broader or a narrower view 
of capital, he Ktid» that the variouH olcmenta of which it is 
cmnposed differ more or less from one another iu the way 
in which they enter into the differeut pmbleme \rith which 
be bos ftucceaaively to deal He is cunipelU'U thoreiun; to 
supplenwDt his Btaudard deBnition by an (Explanation uf the 
bvaring of vacfa several element of capital ou the point at 
isftue. These special aual>'»eji utl- subbtuntially the same 
iu the worka of all careful writers on econoiuiis, however 

[divetgeat may be tbeir standard defiuitiouH of capital; the 
u> thus brought to vcty much the ftaine coucLusioD by 
^ver rout« he travels; though it may sometimes requii^ 
« Uttt« trouble to disc«m the unity in sulMtauco that undor- 
li«K the ditfcreuces iu the words which are used by different 
Acboob of c-conoiuUt« to exprv^s their dootriaes relating to 

[capital '. 

> Flor liiltkBM, «)i*t«T«r JAfbiiliaii nl ra|iiUl «*■ Ukt^ it will tw l'ii)ii<lliib«ttne 
ftl m gmtni tocw pe «l capital aatiiuvnta lli« duiuaiiil for l»bour aijd pkjmb 
w^TM. kwl wiMteTtT dcftutUuu «<} tAke il Is iH't trw Uiat nil kitiils iif cn|iiul acl 
«itb niaal iatte in Uiii dJr<c4iuD. iir Uinl il i> potuiUo Ui ««y Uaw gnut aa »Awt 
uif gii«a taooMt in Um total anunuit ot c«p[Ul will Iut« tn raMns ftf*- *rilb- 
MA •ftanfaUly isqvtatag «• to Ui« i-articalar fonu vliich Uw lutniM hai lakm. 
TUa i«i|aliT ia ih* mII; iupoftuil ^n of th<i mn-k: It htA to b* mada In t«i7 
vvcli Uni «aBM OMRMT aiwlit oMiMa to Uie •MLuonnJl , «liat«voi bt Uw iMnitwn 
«rf i-iiftal witb vUcli vo Lax* tlajtciL Similai murki afplj hi the inrslfgHioi) 



■tai*d-ai> 
wnallli, 
TItia ill' 4 

tlk« aat of 
till- U-nu m 
lo be r«- 



i-ana _ ^_, 
c>iiifu«B 
tliaii ml^t 
bavebcni 
uxpKted. 



134 



CAPITAL. 



BOOR II. 
Cll. ». 

Cinm- 
latinif Slid 
nrtd 
tapitar. 



Rpteialhtii 
eajiital. 



A ei,adaii 
Bffaliiat a 
(Kicrcw tit 
c<>nfiuicui. 



Pertonai 
tapitoi. 



§ 4. Whether we ow the term c«pitftl in it« tjwMler" 

or its uarpower sensG, wo may follow Mill in difitinguishiiig 
CIBCULATDia CAPITAL "* which fulfils the whole of its office 
in the productiou in which it is engaged, by a single iise," 
fix)Hi i^lXED CAPiTAl, " which exists in a duralile shajie and 
the retuni to which la aproofl over a period of eorrosponding 
duration." 

Soraotimes again we have to distinguwh certain kinds of 
capita! as SPECIALIZED because having been desigued for iis*; 
in one trade they cannnt easily be divtrtwi to another. ^| 

Mill luu! others have used fixed capital somelimes iii th^* 
8en8e that we have retained for it. sometime-s in the senses 
that we have given to si^cialized and to auxiliary capital 
But there w much fixed capitial which in not sjwcialized. 
such as buildijigs and .'*onie kinds of nia<^hinery which are 
adapted to many diHcrcnt trades: while some materials of 
mauu&cture and other kinds of circulating capital are 
apecializnd, Again much fixed capital is also cooMiniption 
capital, as for instance workmen'^ cnttagt^n. ^H 

Alm<))^t all inodeni definitions of capital include, as oura 
have done, business goodwill and diniLiar external persuiuil 
goods which have exchange value: but many writers go 
further aud include Perwjiial capital We have already defined 
Personal wealth' to consist fiwtly of those energies, faculties 
and habits which directly contribute to making people indus- 
trially efficient, and secondly of their businete connections 
and associatione of every kind. Tlie first group consisl? of 
intenial goodo and the second of ext^^nal goods; but bikih 
are prodnetivo; and thei-eforo if they are to be reckoned 
as wealth at all, they are al^o to be reckoned as capitaj^B 

uf tliu (MUM* irliich (lotvrmiiw tlw nU oi [utcrut ou capitAl, uid !le aggreRBtc 
nnimtiil. 

Ef «w vtTf tTfi« In rniimtiiirt a l4"niiliin.l(i(0- ultb sol" relmpiiw lo thr nunlii ri 
iicditoiiiiL' H-'iciici', il luiiflil i>erlia]is be Iwst lit iiivciiL olliur tormii fiir uthra' n«H) 
which thn Iithi un|iitnl in aovr tnniln tn mlunrTo. mid U> ilnrnt* Mist t«TDi exihurrBljr 
to re])i-«frititig Uh- luiouiit of UlwUr cuiiibii.isl witli ttlwiUiicu** tli»t in iuTMIvA in 
tuiT piirljculiLt' ■>>iu'UC' u( i<[ijui}imuut lukiU liv attui. Fur llira «)iin-|iti<>u is oapatblo 
iif beine (le>i>IuppiV frdtn n piin-Ij alialnKil imiiil trf view, witli liiRi'pJ romiifkucj. 
ATid ntBCliraullrnl riwtiinM nt q,iiuitLtatlt(i niijunrrmftil. To till* poliil W0 tluUI 
tKinni ill Uje lii«turicttl uoUi tt Uie eiul of the chipler and elwwbertt. 

I Book II. Ol H. t e. 



PERSONAt. CAPITAL. 

Thus Personal wenlth and Pc-rsoiial capital are convertible ; »oob ti. 
and it seems best to follow here the Kame course a* in the ' 
caw of Wealth, aud for the same reasons. That is, it is best 
10 aBsurae that the term " capital " when taken aloue includes 
luuie but external goodtt ; but yet to raise no objection to an 
oocanonal bn)ad use of the tcnn, ui which it is explicitly 
stated to include HerHonal capital. 



HISTORICAL XOTE ON* DEFINITIONS OF THE TERM 
"CAPITAL." 

TVK foUoving Arc Among th« chi«f itatinitBona of capitaj in vhi«b it 

\ U regarded lu confuting of tbooc thiugn which relate to future proiluc- 

tiofl. It will be found that most of them tacitly amuuii.' thnt ojipitu] 

ia to be reganl«d from Uh; nocial iKiiiit of view, vvt-.n thimgU the wunl- 

Ing at first ngbt Mcenic mthcr to HUgg««t the individual ]v>int of view. 

Ric«rdo wys, Priwipie* of Polltieal Eamami/, Cb. iv.): — "Capital IB 

that [wrt of tbo wonlth of ■ eountr; wbicb » etaployod in prodaotion 

aud cuDsisid of food, clothing, tooU, raw lUAterink, iiinchiiiery, etc 

uac—ttyy to give eSoct to labour." MaltUua in hi» Dejinftioni in I'oli- 

tiaj Bcottomi/ mjb: — "Cnpitnl ia that jxirtion of the iit4«.k urntijiintry 

whtcii t» kejit or Mnployed vitb a view to profit in ths produotion and 

■UitUibutioti of wtutltfa." Bonior iti hiH Poltticat Economy t»pi: — 

I "ChpitAl is At) MTtkle of wcAlth, tbo rcatult of human exertion, euiplojed 

rin the production or distribution of wi-jilth," John Stuart Mill in hia 

\ Phndptr* of Politieal Econoj-ty, Book i, Cb. iv. 5 1, «)■»:—" What 

oaptta) (lues for |>toductioii, is to HfTord ihv shelter, protection, tools 

•ad tUat«riAlM which thu woric rrciiiirRK, nnd to f)>cd and otherwise 

J maintain the labourers during the process. WHiatever things are 

P'dmtined for this use arc caiiiLal." Or ti> um hm own miuimury: — 

'Oa^iHal ia wealth devuMl to tvitiroductive eiiiployinaiit.' 

Tha tint great tmpulw in tbo direction of iDitisting on tho diatinc- 
tJOD tvtwcm sodal and individual L-a|ntal sovnis to buve beeo given hy 
tUm, who dofiow capital froiu both [Kiiiits of view, ea "the lueans of 
obtaining a Uralibood" (iTrwer^iiVrri}, and nukes a suggeatire though 
lot oompletdy eatiafactor^' dintimrtiui) botweon th«n), very much in 
huodcRi fiiahion {rolltmrthtAafiiUhre, §§ 51— »fi, 131)— 133). Again 
I KamA«t sajr* ** Otpttal we oall «%-ery product biid by for puqxMM of 
bar production" (Poliiitai Bconomy. j iLii.). W'^usr says: — 
\roU»»nrt)t*i^frilfJirtj § 2fi) that in roganling cA]vital we must dis- 
|-tuiguiab between the pun: economic and the historic-juristic (geacAieit- 
-rtchiiieAi •taitd|M)tntH. Prtun the former point of vi«w it is a 
MOO of means of production {Prodaaiwumiud' Vorralk). Proin 



13« 



IIIKTOKICAL NOTE 



»iK>K ir. 



A second point of vi»w it m ragArded tui that piirt nf the poflMSUMS 4 
an inrlivjijual which ore iiaetl 1>y hiiuaji m tueiuiN Drulitjiiuii^ kIjvbU- 
hood {Hrwtrbmiitlel). From this jwint nf view we coatit in ilie free 
pKa of iiaturo which havu Ixiudnic |>Ht-iitr iimixirtv, 1itit not frviiii tbr 
fonuer point of Flew. Klein wiichter in SehOiil>©rg« Haudlnich rt-ninrlM 
with [uuuh trutli Hint thin ili^rinitiDri pubs pratDiactitlj Inrminl, atld with 
the movt pregnuit lirovitj', that which is common to all this fnoup of 
dcdiiitionn. Somewhat to a. tuiiiiUr otltot Sidgwick, f'rwipiet of Poli' 
tieal Jicnuiiiii/, Bcx^k t. Cli. v.), di-flnn Sociitl cupitMl dm "Wealth em- 
plujct] Ui bring a. eHrpiiw or profit not to th* individunl owner onljr 
Imt Ui tJift iriiliixtriHl mmiiiiiiiity "f which hi* is a member,' while he 
holdjt thdt "Individual's Cnpital ia wealth etuploved for profit.'' BGl]ia<^| 
Bawork {OMehichte dtr Ca^kiitmii- Tftenrum.) ilon»CK cnpilal wi "A ^ 
cvuiplci t'f luwtita of obtnining n livolilitHxl ntodc by lunii ; that ia a 
coiuplei of g(H)d8 which hnd their origin in a previous jirooeM of |)ia- 
duotiou aud aro destined not for iiuiuodiato coiiaiimiitioii for the ooko of 
eiyoyniont {(iifnutMiwuitmfion) but the acquisition (frimrAuny) of tuoro 
goods." The history of the above de&uitious seeiun to show a duliact 
tendency' In the direction of those which have beou ndo|)tad u the 
•taodvd dcfiiiiti«iu» iu thv text. But on utt«iu[it ia niads there lo 
etny this mtyvemeat furtht^r iu the dir^ctiou of (li&tiuguiiihing tlie oon- 
auiDptic'ji which in nc^CHaary for ethcitucy uu the part of workciM of 
oil grmlGS, from that witicli is not thiw uecctiH&ry. ^^ 

But oicanwhilt nearly oil the onrlier Frtuich EcKiiiuiiiintM luive fo^H 
iowol iu the liiies laiil down hy the PhyaiocraUi fcofi>po Ailatn Sniith^^ 
wrutv, and umxl the tvnu "citpital" very much in tho sonic in which he 
and hiH inmivdiatt) fuJowvra used the word "stock," tn include alt 
Aouciui Ilia ted wealth (vatttiM accumvlAt) which arc thu result of thu 
execM of production over conBumption. And althoujfh in ri^c«nt years 
they have nhown a decided tendency to use the terui iu tlie uarrowg r m 
I^nghuh iwiiiH.-, there in at the wune time a oonaideivble tuovrntent on tli^H 
partofaomoof bliuproToundaatthiulcaraiii Gortiiiuiy otid Knjiliviid in the 
directiuu of the older and hrowlur French duHnitiun. 'I'fav rht-Hjoorats 
were undoubtedly led in thia directiou hy tiieir bijui towanls luatbeuw- 
ttoai hahita of thought; beoauae it is jviaiiiljle to represent by a elear- 
cut loaihematical furmula the elcutcuta of pant laljount tliat wore de- 
voted Ut pruvidltig for the iioeda of the future, each multiplied by torn- 
pomid intorvst fur tlm tiuiv duriu^ which ito fruita went iu ubuyuiioc. 
Thia formula has grwit attnictionit, but itd<ii'* ii(itoo[TO"|Kiiuld'is*ly to 
Uie ixiuditions uf nud life; For itistanco it takes no nououut of the 
tliflbrciil rat«i of depreciation of different product* of paal labour, ac- 
Gordiug an tlw purinnen for which they wtirc ungiii;dly iiit^^ndcd haTc 
Tetainm.1 tboir groimd, or hnve Iwoouiv olBtuletu. And where uometiona 
fif cbia ctaaa are introduced the fonauin locvs its oi)e great metit nf 
simplicity combined with exovtuesA. 

It wiu) probably Hfinnaiiu'ii timtticuuitical bina that itiolined him 



on DEFfNITIONS OP THE TERM CAPITAL. 



MJHSlaatfmflttmAt^iefM Cnivrtmc/iiaigvn, CIim. iil and v.), thut wpibil 
OOoanU uf ipxKls "wbicii nrv h [akUh^ Mutirvu uf MitiisfoctiDti tlmt liii« 
esahaag* nltM." Tliow wbicli siv« the soUiUactioii directly and 
intbout obaugiug their fomi lire Gon»uinption-ca^ita! [.Vitti-littpititll\, 
ftnj ioclutlu Mi«h Uiiiigit as furiiittire and cluthiuy. He vlfmam under 
the bead at "produotion capital' neAily all tiwae thiugs vhid] moHt 
Englinh whten ngnrd tM cooslitutiug the whole of cnpitid. But lie 
tacludm (reo gilts or natuni imd^ each of hi« hoadif. AgTiiii the 
Muoc luatbota&tkal bias baa led J«rroDa to a ivTy aiaiilar coucliidium 
fM« ia particular hia " (Juontilalive Notiona onaceniiiig cnpltal,*' aud 
bit uxuniiait tb&t "Articlos iu the coDsamor'B hacids arc oapitul,' Jti 
Ch. vn. of hiK Theory o/ fotttieat fieonamy). Kcies and Cohn tinvp 
adotrted defiaitiooa uot vary diaaiuiUr ft-oiu Uamianii'a. 

The AmericHn AatnmamGr, Xenoomb (Frinnplt* o/ Polifieai £e«- 
Mmy, Bunk ll. Cti. V.),deGi]«B capital as "wealth dotire^ nob for its own 
aake, but for lliooakoof tL«8ust«i3aii(.>e[i,e, oonsumption-wealthj which 
itwilleiubh)ustoprDduM^''and proposes that weahioHld detiitn [leraon 
wbu Uv«M lo U hired hooae vith tugatiea capiat to th« amonnt of th« 
'line of that bou0» H* tbua carriM out to ita luftical coticluHion n 
{vojuaal that has uft«ii beef) uiode (a« tor JiiutAiice hy Mr Miuilood) with 
rapid tu tbo loau of capital. Thia plan aitupliftcs the relation ia ivhich 
•ucial mpital Htaiula U> individitnl t.-fl])itnl : aiid it nv'>i<lfi tho ixnnmon 
di<Banlty of baviug to aar that nlivn ii hiwit builder hirea hia cairiagv 
team aoarriag* biiildiir, who niftonwhile hirps his ynoht from tha boat 
boiUar, tlio capital of oacli wouM h« diminiahcd it ench wera to buy 
Um tbiag that he bad been hiring. But hia plaii Htill fnilu t<i vxhiliit 
elaarly the iucraaaed provision for the future which is mode nhui n 
dttrable 6toD« houae ia flubstitutcd for a periabatile woodeo ooe^ which 
ft/n tor the tine e^unl Mwoinmodatioa 



SOOK It 

cu. 1. 



Adam Smith's dtstinctiaii betvroen Fiud and Circulating oi^iitnl 
ntmed od tbo queatioo wbethcr the g<ml» "yield a profit witiioul 
duQgiiig maaten* or nut. Kicordi) miul>a it turn nu whetlLur thvy aru 
"of alow conxumptioQ or rMgtiiic to be IVcqiiently reproduced;* but 
ha truly mnarka that Cbia ia "a divittioo not essential and iu which 
tbe Uoc of demarcatiou cannot be luxiiirately ilrawn." Mill'e itiodifi- 
oatioti of R)cani(i/a daftaitioiia of tbtae teraia fa genendly aooapt«d by 
modem ecoQomieU. 

W'ttii iili^ht variation in phraaeology produutivvcapitiJ Is divided by 
aJmoat all vconomists of every country iulo the raw material, the 
tiD[4MD«iita of pmdaction and the siuttoDaiice of productive lalwuruni ; 
thoo^ aa we have alroady scvd the Umit« uf this Wt elnuctit hum 
not b«»n poiwriy studied. The plan of inclucliiig th« hIciU and ability 
of Itunaa bdnga uodor the bond of capital which wiu adopt«d by 
Adam Smith, lina been necirly uuiveraal in France, and is ntm- very 
vnmmon Id nil couutrice. 



138 



UlSTORIUAL NUTE. 



cooB n. 

CB. V. 



Kiirl Stan lUid !iU fullu^ccr:' liiy dowti the doctrine thut oiil^l 
in C(i|iitAl, which is n mcuiia vf [inxiuctioii owuod h^* otic pi-nwii (nr 
gniup of {wrsoiis) ami used to {mxluce tliiugs for the benefit of another, 
gDiicrolly hy iiieaiin <if the liirtnl InliDiir of li tliinl; iii Aitcli wise thai 
the firnt haw the oiiportiiutty of itliiridiiring <ir <ix}ilniting Uie OtlicnJ| 
Thin arhitniry doctniic IotmU them hy a different route very nearly to^ 
tha siLine nviult iw in nuiched by tlhwe, who ti^lcct all values thnt do 
not take a diroct uumey forici, niul limit oqiital to what ha« hceii called 
Trade- capitfll in tlio t*it. Mr Hoiiry George, though nul in general 
agreumnnt with Mars, mkiiih to liav« lieaii uiiuiMiadDuttly inlluenced by 
Marx's followarH on this |i()iiit; aud an astaiitfihiiig inmilwr of rcajlan 
both in America ami Eiiglaati liavfi thought thut ho hiu\ ovurthro'rv'n a 
fiuidHcnHiiUd clocitnim i)f ucunoiiiic Mciuiton, whim n^Ily hu ha« only 
laiauntlonitood what, when nghtlv interpreted, is a truiam. Ho ohjects 
{ProffrsM ttnd Povtrtif, Book i. Ch. ii.) to the [ilan followed ty 3Iill of 
deoUring thone thing's only Ui Ix; capital which are doeitiitiMl Ui hii]>- 
[lort and aid [iroductue labour. Ho wkys thut "by remitttug the dift- 
tiuctivu to the luiud vf Uiu uMjiituIiat," Mill inakeo it "no va^^ue that 
no (Hiwer nliort of onuii(M;ieiii.'e could tell in any giveii t^nuutr}' at any 
given tiuiQ whut wiu; and what was a^A capital." And th«D, with a 
otnnigi; iiic.iiisiKtt>iH'y. Mr (.icocga goes on to giva hi* owu definition 
thus :— "If tb« articles of actual wealth cjuatiug ftt any tinio in a given 
cotamiiiiity were presented imitu to a dozen intelligent uion who had 
never rmul a liau of i>olitiaal economy, it in duul>tful if they would 
diflbr in n^^iec't to a Kinglc itisni aa to whether itahould bo accounted 
capital or nut. Money whicli Its owner holds for uti« in bnaiucvi vi 
in fepcculatioti would lie accnuiitod capital ; money «iet aaido for house- 
biold or ]ttir«oiial oi^hjubob would not. That [>art of a farmer's crop held 
for Mile or for need, or to t'e»<l hio help iu i>art iiaymeut of tragea, 
would tm uccuuntud capital; that held for the tuc of hin owd buailj 
would not be." Thiu in hia own deftnitioii Mr Ueorgo aMunuM that 
any intelligent won will Iw able to read a durtiuction that ia rvnubtad 
U> tliR mind of the (<apitnliBt : he aaauuiea this not only iu the case 
of com which the fanner dratiuon to bo oatoii by hia help and not ^^M 
binixolf, but nlm in the vJum t>f that iniiutlpable thing, liia mu:ief,^| 
oxiatiug [lorhnpa only iu the hooka of hia baidcor, which the fnnuer 
dertUuea to be lined in his biisiti«M aud not for houMihold vx|N^!Wik^_ 
Mr Ueorife then appheu Lia dohuitJon in an attack on Mill's doctriiMi^p 
tliat " liiduMtry ix liiiiitinl by (!apitnl." That waa on awkward and. tin- 
fortuiuito sentence which wo ehall have to oouaider lat«r eu. Uean while 
it is enough to deserve thnt Mr U«org8'a oritidsnui of it lose the 
force if we reoteuiber that it ia deliherately beaed on a deliuitiou whic 
includes imder the head of capital, the food of the fkmier aud of lik 
labouTBra even tliough it he already in their owu ]>oasaHiou. 



CHAPTER VL 



IKCOME. 



§ 1. A pkkson's total inamu! cliiriiig. say, a year, consists imok n. 

the u*-w ecouomio g<x)d8 which come to him duriug the _| ' 

year. If in order to obtain sunie of them he had to iiart T<-iai Hfot 
with other goods, his total keal income ir found by ilc- 
ducting the vahie of tht- lattt-r fnmi that of the fonuer; or in 
other words, by deducting from his gross income "the out- 
goings that belong' to its pruductioii'". 

But for Aome of the practical purposes i>f lift: it U cuato- iio^tg 
mot; to cautddcr only his UOMSV INCOUR; that i^ those 
deroente of his total rvaj iucoiiui which come to hiu id thv 
farm of money. To these aiv hi»wi:ver eometimes addfd 
thoee elemeDts which he can easily convert iuto moooy, or 
which save him some pecuniary' expense ; for instance, if 
a ni&n Uvee in his owa house, or tarms hid own land, the 
CBiinuitcd rent of the hoiiso or of the farm is ordinarily 

[reckoned as part of his income. But no account is commonly 
taken of the benefit he derives Iruui the use of his furniture; 
so that if ho hod b«en in the habit of hiring a piano, and 

idetonoioed to sell a railway share and buy the piano instead 
of hiring it, his money income would bo diminished by the 
dividend from the shan*, although it is probable that his 

[total real income would be increased by the change. 

Again, anything which a person does for which he is pnid eimdcqih 
directly or indirectly in money, helps Ui swl-II His money jneome 

^income, while no services that he performs for him-wlf are ""■*"'' ''" 
aft adding to hiR nomiiml income, though they may 

< Sm ft Mfort of • ConuDittM at tlie Brillub JUitociatioti. tS7S. 




a very important part ol hi? total reoJ income. A man 

who digs in hia ovn gardon or rcpcuni his uwti house, is 

in'ibrf^ earning income just aa would the gardener or carpenter whom 

of maai-j he might hire to do the work. Tho factory woman who biros 

ibuKuruf others to tend hor children and to do some of her household 

lookwl?'"' work, often finds that by stiij'ing at home she would increase 

tho real income of the family, even while diminishing it*t 

money income by the anioniit of her wagai. In the tiame way 

that rent carmugs are iu the factory districts often less than 

they appear to he, they are generally more than they appear to 

be where ngricidtural populations make in the winter evenings 

elolli or other things for their uwu use, a^ wa« done to a gr»*at 

extent in medisevnl times, and as is done even now in some 

parts of the world. On the uther hand tho caste system of the 

Hindoo makes him pay for having things done for him, which 

labourers in most parts of the world do for themselves; his 

income is less than it uppeun tt» be by what he pays for 

having himself shaved and for the washing of the clothes of 

himself und hia family'. But when wc art comparing [>eople 

whose habits of life are in most respects the same, it is 

seldom worth while to take any ^^pucial account of the miiior^ 

scnicus which each perfnrmH for himself. ^M 

It would be a great conveiiieiicu if there were two words 

ax-ailablc: one to represent a perbon's total income and another 

hia money income, i. e. that part of his total income which 

comes to him ia the form of money. For scientific purposes 

it would be beat that the word income when occuniug alone 

Khoidd always mean total real income. But as thi>t plan is 

incoasisteut with general uimge we must, whenever there is 

any danger of mi8UndeT8tan<iing, say distinctly whether the 

term is to bt taken in its narrower or its broaxler use. We 

Khali have to revert again to this class of diEBculties, especiaU^^ 

in our imjuiry nx to the causes which determine earnings in 

different occupatinns. 

§ 2. Sodal Income may be estimated by adrling togethf 

the iucoraes of the IndividualH in the society in questioo 

1 111 ft |>uii|)lilrt |iiiblii>bn<1 ill ITHT on Uio ty]iinJ haiieci ol b Loiiiliin 
niUi £:<0 a year, wlin l« kii|iin)w<1 Iu lire on tbo mt«iiMt fix^ and cImii bh 
uwu liout«, wt find BnUrml « woriily Haa o( W. (o» " SbitTing, 
Wig titi«»." 






INDIVIDUAL AND SOCIAL INCOME. NET [NCOMi:. 



143 



whether it be a nation or am oiher larprer or sinailer group 
of persons. But to reckou it dirtictly is for inoat purposes 
simplest and best. Everything that is proihirt-il in the conrst* 
of a year, every service rendei'ed, every freah utility bruugiit 
abotit is a part of the oationai income-. Of course: thi* vahie 
of thiugs ooiisumcd in tht- prucesw of prodiiciion imist be 
deducted from the gross produce, in order to find the net 
produce. For ia»tauce doductious must bu mode fur tho 
raitte of raw materia] used, and for the depreciation of fixed 
capital; but interest ou bonvwed capital, and wages of hired 
Inboar may bo counteti cm tho uudL-r^tan^ting that th« ger- 

I vices to which they correspond are not entered as separate 

, items'. 

§ 3. The term set ixcame is however often used in 
a verj' narrow souw? iu whioh the uet iueomo of aiiy indi- 

I vtdiml hiixinetw ia that which remain!) from the gross produce 
after deducting all (he necot^ary outgoings, chat is the \^'ago&, 
price of raw inaU^rial, intere.<tt, depmciation and insurance on 
cajrital, and olht^r exp&asys, which the undertaker is com- 

I polled lo pay. The price of the nceesMiries of his own 
efficiency might logically be deducted also, but ax. this would 

I be contrary to aistttm it muxt be taken not to be done unless 

[tp«dal mention is made of it. 

The term net produce or income of any social group (when 

foot other^rise specially explaiued) may be taken to be that 
which remains from the gross pnHiiice after n>placing material 

, capital and suppijing nil that is ncces-sarj^ to mi!<laiu the 

■ numbers and efficiency of the [wpulutiun. or ruther of thoAe 
dawes of them that are engaged in pmdiictioii, It may be 

jiockoijcd lor any length of time, but practically the eitlimate 
of little value unless it covers a perin<l sufficiently long to 
iw for Ihe acci<tents of trade and the tlticluations of pms- 

Iperily. 



soox n- 
cm rt. 



<ii ail iii4li 



Milt Ml 



> TliBi if .< hirvv I! u A iirii-ali' Bnerctarjr. ivu lunat inihuI .Is full iacnnie 

I MvU Bn tfi MUry l<i f^t l)i* iiatioiikl iucumc-^ (or the {layiDciit .1 luakv* to fi 

[•h tot UiOH mtnittm wliidi lis vlccia la lako m pnii uf Lin iucuiuc. BoL U J 

■a olluwauce Ui bis win (\ Cn iticomr ia nut ta It cduiiIf'! utiltxc k 

■muuiit 11 iliiliirtfil friigi) A*. Par C reuderit ua M<n'lcc« to A 

' ill .-I ciniiiljr Iniattn inn al tni iucnino to C. Thin jtrinriplr ii fnllowcd iii 




«COiiuuiUtii 

rJi uf 
growUii 
of ciipiitn) 
wLmi Uiej 
mnmi thn 



Cum- 
■ponititigtu 

cairital is 

'itanit at 



Pni/iU. 



ofMamagn- 

Ktenl. 

Bmt. 



§ +. Much error haa been caused 'by the fiict t\ 
(iL-Hniiig "capital'' more i>r less niUTOwly, somo ecouomists 
have glided into treating it as c^xtcnsive with aecumulaleil 
wealth. A strikiujf iustaiite \s se«ii \a the important en- 
<]nii^" iuto the causes which detiermine the accumulatioii ol' 
wealth, which they have oftwn worded as though it were con- 
eonifd aiily with the growth of ciipital in the mure or lesw 
namiw i^ew^e iii which they have dclined capital. This in- 
accurncj has been partly Jiie to the fact that interest i« 
habitually associated with capital ;. and it has been found 
convenient to siieak uC the growth of capital as itiBueiiced 
by the rate of interest But really the tsubstance of the 
ai;gument wiui the influence on the accumiilativu of wealth 
exercised by the benciits which the possession of wealth 
gives, whether the wealth was in those fonns which they had 
clawed an capital or not. This then is one of the few cases 
in which the evils of coining a new economic torra «ecin to 
be outweighed by its advantages. 

The benetits which the owner of wudth dcrivcH from it 
may be called the USASCE OF ^veai,tu. They include as 
a .special taisc the money income which is ilerived from capital 
and is called int£1ib»t ; and this is most cosily metuiiin-ti 
when it takes the fumi of a payment ma<Ie by a borrower 
for the uae of a loan for, say, a year ; it b then expresisetl Wh 
the ratio which that payment bear^ to the loau. ^ 

Deferring a further discus&ion of this subject till we 
come to consider the causes which determine the Growth of 
Wealth, we may briefly say here that when a man is engaged 
in business., his rROPixa for the year arc the esccse of his re- 
ceipts from hie biisinos* diiriiig the year over his outlay for bis 
bufUDei9< ; the dilf*>ri>nee between the value of hia ittoek and 
plant at the end and at the beginning of the year being taken 
as part of his recuiptH or aa part uf bin outlay, nccording as 
there has been an increase or decrease of value. What 
remuus of hui profits after deducting interest on his capital 
at the current rate may be called his earnings op UNDei 
TAKJXG or MANAGEMENT. 

The income derived from the ownership of land i;* cor 
mouly called rent, and tho term ia Htretched ro an to inctiK 



VARIOUS FORMS OP INOOUE. 



14S 



ihat derived ft«Tii letting hotise». nnd even siifli things o^ 
Immcs, piADos, am! sewing raaohinep. In a much tiarrowcT tise 
the t«mi has been appli(?<l RjK'cinlly Co the niiniial income de- 
rivw! Iroin thot* free giflH uf iiatare which havo bcou appro- 
priaictl But this use again ha-s been grmhiatly uxtendtnl 
nnlil il iovludett the income derived (rum things of all kiiid^ 
of which the supply in liniit(>d and cannot h« inc-i'v>aflt>d hy 
mau's actiuu. 'thin we may lake to bo uow e&tablutlit^d as 
ithc scientific use of the t«nn, though it is not frci* from 
(Ufficullioa, as we shall see hurwafter; and we cannot diHpcuKe 

intirely with the hmj of the (-enn in its broader popular 

§ 5. The money income of a nation givm a measuru 
of its econouiic proKpcrily. wliifh. uutruatworthy as it in, 

118 yet in some rcspwts hettpr than that afforded by the 
iDooey value of its accumulated wealth*. For iucoiue con- 



BOOS n. 




biDoms te ■ 
betlcriuc*- 

ttOTB of 

(Gooomtc 



' FurUiW dlfflcoUiM wouincted mxb the iunt «f Uieno tcnns tsuty ho Antaroi 
Idt Um praMcnt. Oim of tlum ulau Irom Uih laet tijai in wme ce»»a auii> 
kaip uf inuagtoiail uiil iutwMl on cairiUl tiiHrllicr (a11 klmrt iJ (oil praflla 

kf tfc* WfatvtlMt of Ibo tronble aiul tiaks iavolveil in liononin); unl It-nilJiiK. 
OUmtb afa eomnaotod vjlh tha (ffntii ox U>* real ratoiif itiUmixL ]iu<] oliicliai* 
torn (« a cbaage in tlio pnrehawng puwvr nf uioucy Wtwi.fiii Uiu ilalr ai whidi Uie 
loaii aras ountnetod antl Uia data al wLli'ti it U rvjialil; oiiil utiicre aKoiu ar« 
auaaaclnl mUi tLo iivTaaw lu (lit- tiitinuiiU vnlnt' of land aud othu armrcna of 
Inmne wUcb ara An* lo a laU iii Uie ntu uf iuU-rat. 

■ Ut ortinutaa of a n&tian'i riplin«i» buMiil oii a nwrn mnni'jr mcoi^rc are 
livneBMnljr iaii(l(«iliti|;, diiiilljr for Lliv ivilhiiih wliicli bavv Ihvm iixlii-at*!! in 
Uw dtaptcr oii wtoltb aud the prvtciit diaptcr. But tliiv* ihry ure frcqiUItUr 
natd*, il may be woU k> poiiit out iLat utuii If «ii »tl^ev li>r aiiy !<|iiiclal punioaa 
ki ncard Uie riduMwi od a iiaUon u rtT|irmRut«1 li; iU iii>citipy iiicomr tbo 
(pUaUnD wtikli of two naUaoa la nrbcr tbaii aiiotl)»i U MUI uiibiciuion. I* tLe 
rifiinaw of a nBtim U> ba Btaaaoivd by Uui a^-n^gnUi uiotify iiiooiuci of iU viiliali- 
Ka&ta or bj tMl avwafe lli«cltiM? If tbn tnnite-T, Iivlin u riElmr Uird Holland; 
If Um laUaTi HoUanl ia tar ricbar Uun ladin. Tliv latter t> (('">•'>'» 11; U" more 
ImpoilaBt nwaMm fw tbe vurpoaaa of tlia ttaduiil uf HH-ial H-iiim-. tiiv ri<nu«r Igr 
UwH fl( Um dlphmaUal. If. liiim-TDr. «>■ arr iiiiiiiiilirriiis a iialimi'i pamm of 
beariag ■ Iobc eoalimad fluaudal HtnUn of war. nu uiny ui(«iiiirt.' ila riclinaaa 
roagUr ^ ^ axcam of Uut roui Uilnl uf tliti tiK^timio ul iU iiilinliiiaiilu «v«r 
mhMt la ra q nliiad le aajiply tbuin iritli tlie iiLvrinariMi «t 11f«. A roii|;li notion of 
tba aMttiMnie ■Ucngth <if a uatiuti, (<ir lliu i-utjkjhi at cniu|iariuiii wilh Uiat of 
othara. niajr be gtd b; mnlliiiljiiig Uii: afu^rvt.'atu iucome uf ita iulutbihuitg by Ujeir 
aimgabtMBMu 

Til* aABttoB Uial ati inuuisram nrakM (a Uie riobca uf a rooiitry maj cu tbo 
wna ida« ba aaUaatad as ibe axcat* at Uw tola] diwnnntol ndun of Ihn incmnc 
ba wtU uarn i>v«r ttiU nhkli mtU be nqnirod tor hia umi au|i]Kn-l. 'I'lita UMtiiuata 
glaaa naulta uot taay dlflmnt from llial not an Ut« iilan «f aalitnatiu); Uia 



144 



INCUME. 



u'cnltll. 



HOOK 11. sists chkfly of commoditiee in a form to jpve pic 
ca^. jj^.p^iy. n-hile the greater part of nntional wvalth cor 
i^ri^iwrity yf the means of production, which are of 8orvicc to tbfr'l 
nation only m so far an they pontnmite to pnwucing cmii- 
luodities ready for couMumptioa Aud further, though this 
is a Qunor point, conMimable commodities being more port- i 
able hare more nearly uulforni prices all the world over: 
thi; prices of an acre of good land in Illinois and in Kent 
differ more than those of a bushel of wheat in the two 
placvK. 

But if we look chiefly at the income of n. countiy we must 
idlow for the depreciatiou of thu sources from which it is 
deriveii. More must be deduced fmni the income derived 
from a house If U in uiado of wood, than if it Is made of stone ; 
astoiie house counts for more tnwarda the real richness of a 
country than a wcjoden house which gives equally good 
accommodation. Again a mine whirh fields for a time a 
large uicojnv, but will be exhiiiiKtud in a few years, muM be 
counted as eqaiiralent to a field, or a fishery, which yield* a 
much sumller annual income but will yield that incoiu« 
permanently. 



Tiloe of hniidjETtuti nudir miilitle iit[» at the inm ol tlir eipsusM ol r«arlii| 
and edneating Uimq. 



BOOK III. 

DEMAND OR CONSUMPTION. 



U. 



10 



CHAPTER I. 



INTRODUCTORy. 



§ 1. The oldi^r dctiaitions of ectmomicw desoribod it as book nt. 
Iiescienoe whieh U coucerned with the Produetiun, Disiribu- ™' ' " 
tsoD, Exchange and ConBiiniption of Wealth. Latpr C3[|)eri- The rdm- 
Icnce has showu that tht? problt^ma of Distributiuii jtnd Ex-wWphthe 
change aro so closelj connected, that it is doubtful whether K^Ik" 
anything is to be gained by the attempt to keep them ^"^{^ 
separate: and in the present treatise they arti disfusaed ^'^'J'"** 
together iu the Sixth Book under the common title of Vahie, 
There i« however a good deal of general reasoning with re- 
gard to thf relation of Demand and Supply which is re()uired 
M a bans for the practical problems of Value, and which acta 
AB an underlj-ing backbone giving nnity and consistency to 
the main body of economic reasoning. Its very breadth and 
genetality mark it uiT from the muru concrete? problems of 
ibution and Exchange to which it is subservient ; and 
fore it is put tfjgether in a soparutc Book on " The 
Igenerai Theor)' of Demand and Supply" introddctory to that 
Value Preparing the way for thut Book arc two Books 
espectjvely on "Demand or Consiunptlon," and on " Pro- 
luctioD ur Supply." 

g S. The latt«r of tbeee two Books corresponds iu general 
rcitaractcr to that diicuiwioD of Prodtictiou to which a largo 
has been given in nearly all English treatises on 
[•nctml economics during the last two gcaerations: although 
' its relation to the problems of Demand and Supply has not 

10—2 




Vurj Utile 
nttcntinn 
ha* Imcu 
P«U till n>. 

(rf Dcmimil 
or Cod- 
Hiuutrtlou. 



ilnl Mveral 
uunneii *re 
oow tiring- 
ing it into 

prouiiu- 
«ne«. 

TJio first 

OMISQ. 



Tbe second 



been made siifRuwutly clear. But until recently the 
ji!ct of Dfiimiid or Consuniption ha& bueii nejflecteU; the 
prniiiiiK'iit place whicli Consumption has received m the 
prugraiiutie of the scieiicc ha^ not bcc-n justititid by any 
attempt to cxumiuc it carefully'. Nor has this nfgl<?ct l>«ca 
altogether accidental. For important as is the inquiry how 
to turn our resources to the beat account, it is not one 
which lends iteelf, so far as the fcxpeoditiirt of private in- 
dividuals is concerned, to the methods of economics. The 
common sense of a person who has had a large experienoG of 
life will give him mora gnidajicu in such a matter than he 
con gain from aubtlu eoouomic aualysL'x: aiid until recently 
cconomistR said little on the suhj^-ct, because they really 
had nut much to say that was not the common properly of 
all sensible people. But receutly several uauHOS have tsoBi' 
biued to ^ve tho subject a greater proniineuce in economic 
discussions. 

The first of these b the growing belief that harm waa 
done by Ricardu's habit of apeaking of the exchange value of 
a thing as though it were determined exclusively by the 
difficulty of producing it. Although he and his chief fol- 
lowem were aware that the conditionB of demand played as 
important a [lart as bhuse of supply in doteniiiuing value. 
yet they did not express their meaning with sufficient clear- 
nees, and they have beeu uuHUudcTstiHjd by all but the most 
careful readers. ^M 

Secondly, the growth of exact habits <if thought in eoo* 
nomics 'w making people more careful to state dietiuctly the 
prumiacs on which they reaaou. This iucreu^tid can i» partly 
due to the application by some writerti of mathematical lan- 
guage aud mathematical habita of thought. It is doubtful 
wheth«r much ban boon gained diiectly by the use of com- 
plex mathematical formuhe. But the application of mathe- 
matical habits of thought has boeu of great service; for it 
has led people to refuse to consi<!er a problem until they are 
qutt« sure what the problem is ; and to insist on knowing 



> JsiiiMiMiII iJiiU'iilfuIlMlii largi) |isrtciT lUti "Kli^inuiitauf PoUtiMlEMiioili;' 
\ij tha titio " Conauraptiun," bat it in ruUljr occnpiad tlmMl •xeludrftlf itith i 
Lmjuiiy Into tii« TftiueiflM ot Tuution. 



nmrANTi or oossumptiok. 

wltat is, ADd what is not intended to be aiwumod, before ■"><>■ ">• 
proceeding farther. This has in its turn compelled a more Til. 
carcfal analysis of all the leading conceptions of economics, 
(Uid espeoally of demand ; for the mere attempt to state 
dearly how the domnnd for a thing in to be measured opens 
I up new atpects of the main pmblunia of t-conomica. And 

jgh the theory of demand is yet in it« infancy, we can 
]y see that it may he possible to colluet and arrange 
itotifftics of congnmption in such a way as to throw light on 
difficult questiuus of gn>at itnjHirtance tu public well-being. 

Lnstty, the spirit of the age indnceg a closer attention Tba thfnl 

the question whether our iucreasiug wealth may nut be "^ 
made to go further than it does in promoting the gmeml 
well-being: and this again couipcU us to examiue huw far 
the exchange value of any element of wealth, whether in 
collertive or individnal use, represents accurately the addi* 
tion which it makes to happinew and well-being. 

Such are the inquiriea towards which the present Book is 
deagncd to ])uint the way'. 



* Jtrtn» {TJ-fOTf of PiJUlc^ A.VnmMdyin^UbudoiuiDonlliui any anaalM 
l« loaUr Ibc STovrtli »( xriilclj-fproail interest in tbbupoctof «aonoiulu«d«DMi 
tlma^ KitlaiffTn to liloanali ho hod beui auitldpaWtl In muor <it liia bt^at Lkuit)!l>ta 
hj Cmmol llteeitrcku •or lu t^ndpa* Uarhlmatiiivia dr Ut TUinrir tltA 
JHokuau. 183S. Iiud hf O c— l i ii {Eattfv:lit.UaiQ der (ittrlit iltt nbtiuiehlifirn 
Vmimkn, |!i>ll. In the Muqp jntr, ISTl. in wbtoli Jercmx' Thtor^j ■pi'Miv'I, 
Dr Kul Manga fititiliiibed tlic Brat piirt of hi» Grundtditf lUr VoUtmnrt/ittha/l. 
•Uirw, wkid), tbou|[)i nol tiiidiiiig um' i;f inatlinnuUEok] luigoasti I* HMdoOj 
— It tm ali o ] la tone, nuA >p|K«ni to Im b wmu; icapcctif, UionKk not In aU, 
toUlwv wlrBUPnl Ikui JerooA' nurli. A luatlieiuiiticBl Uma it •nun nion.- dculy 
iwomimieed. thon^ Uw dm oI matbatutir.*! fonnnlH- is »tUl &voiiIed. in Dr 
Bttln-Bawofc'a llnutMtge 4t» mirUekafilieiett Gitltncerii (tJMC). wbiieh ni«j ha 
Ng>ni*d aa > ooiilimiaUoii nl tbn woikii at Jdvuiit ami UsugKr, but Mpaeially, 
tfc« laltvr U, WalTM ba> publuL-cil from lt)Tl doTmfFMdsa MvUa «i IntanatloK 
wcwoniic InqnUice. tn «liit'b a tn» oae ia insdv a( maUttmuuJui] fimnnlfr. «»d liis 
nanplB luu bean follcrvrd b; Dr Lannliwrdt and otbent. A blbllograplu at 
nMlbmUkal wriUuc* ou ec-uuimiiis b apiwudoil to thn amwiMl ralitiun ot Jarunt' 




Knuioii 
wniitH will 

vunona.hat 
hw iir liiem 
nrv bI to- 
gether in- 
cmpublci 4Jf 
moMiin>- 
nunt. 



§ I. Human wauta unil dtriurua are cuudlU^hk in niiml 
and very variovis io kind. As we have seou '. the highest 
uf ihurn cannot guotrrally be weighed in the balance ; a 
virtnrme man's desire to follow the path of duty is one 
aguitiNt wliich uu mduceineiit caii prevail ; the economist 
has tiO take it as aji ultimate jact. which though of \'itat 
conHn(|UCDCu for hiti work, ih not one «ii which his special 
inothods of reaeoning will throw any additioual Light. But 
even when the desire to do one's duty supplies the leading 
motive to octioQ the iiecea'sities of the case may impose a 
m(-a;SiirabIe limit on its gratihcatioa: the outlay which 
parents make for the education of their children is proiapt«d 
by their desire to do ri^ht, but yet it h nci conditioned and 
limited by their circumstoacea, that fairly defimte state- 
m«Qt£ can be made as to the prices which parents in 
difierent graduH ore willing to pay for diffeK'ut kinds of 



■"il^ 



■ CompKv Book I. Ch. \i. On StonfmU i/otit«i. Uunuuiu (6V(i>itn''ii 
tclmftliehe I'nteraiichnngrn, t'li. II.) cliiniu&cc] naiilii M " nlNioLot*' ADd rrlaltTe. 
biglinr anil lownr. nrgtint knd rnpKlili- of iHintiioiirtiKut. ptwititr ami iioLlitiTt. 
dlrsct ubd iiiilrtwl. HminrU nii'l iinKicnlar, cmutnTil unil liilcmiptBiL. pfimuriMil 
taA tnaponry, <iritLiiiLry unit vxtruuriliuiiry. jitL-wiit and luturv. IiuUvuIubI uvl 
eolbctive, private ntul ]iiil>l[r. " Ami v\n> lliw h'Uf, lint at dJviidaue miK^t l^i' 
extondifd. Tbo uIiiU rpulcr ma* iwrlmpii ht left L» tlimk out Ui« detail* ol imt-)) 
t'lnstillcftllojis lot tiiiusulf. But lliiM u]i)>(irtuiiity laty bo Mkmt of noUdiiK ll>*l 
Btuni's I'lHtoiaan Id >ii ailiiiir&biL- vxuu|iLd ol the wij iu which ftiuklytidttl «uili ui 
UiU kliiil eiia; bi' mvln In utTiviit n tnlulns nt » rmj lil|[h orier tor tfaa yontig. aud 
Iu K>>v UiPiJi uu iiitclLiuFiit aL'<|unliitiuii.ii wltli ibc tHionmuio eondiUau ai life, 
irillinnt tar Aug upon IJimi Any |!artii>n1ar itntnttoii >'it Diokd triors iUfflrntt 
ML wbkli tlief aru not jvt mhU- lo furm, lui icKiupiiiidcdt judgnivut. 




PRICE AS A MEASURE OF UTILriT. 



»1 









edncation. Nearly all actiuns uf Ufe are gavented, at I«a«l 
in part, by desires the forcu of which caii be measured by 
the sacrilice which people are wil]iti}( tt» makv ui order to 
secure their gratificatioD : tbiK Bacrifice may take many 
forms, and a» hin already been ob>«erved even the mode in 
which it is niea-sun-xl may not be tlie same in other worldit 
that it t« io ours. But iu our world it has uearly always con- 
sisted of the tnuuifer of Home definitr material thing whicli 
has been agreed upon as the coimtiitu medium uf exchange, 
id is called " money." The ptirchiuuug power of thin muucy 
may van' from time to time : hut in these early stages of our 
work we aaRumu it to be constant'. 

Thu>i then the desirability or utility of a thiug to a person 
commonly measured by the money price that he will pay 
fw it. If at ajiy tUiie he is willing to pay a shilling, but uo 
more, to obtain one gratification ; and aixpence, but no more, 
to obtfun another; then the utility of the tirrt to him 
is meaaurc-d by a shilling, that of the second by sixpence; 
and the utility of the tlrst is exactly double that of the 
•ecood. 

But ftTCD for the same person a shilling may meosure a 
greater pleasure at one time than at another; because money 
may bo more plontitiil n-ith him, or because hin sensibility 
pleasiirt' may be different at different, times*. And to 
iffeivnt penu>nii the same pieee of money jifl'ords the nieauR 
if pleasurea of very ditferent intensities. 

For even two people whose anteeeduuts are aimilar and 
who appear to be like one another in every respect will yet 
be affiscted in diffemut ways by the same eveuta When, 
for instance, a baud of city school chi](ln?n are sent out for a 
ly'a holiday in the country, it is probable that no two of 
derive from it enjoyment exactly the same in kind, 
eijual in intensity. The siiine surgical operation vaii!u>H 
iflferent amounts of pain to different people. Of two pareottt 
who are. so far as we can fell, equally affucliouate, one will 
sufier mudi more than the other Irom the loss of a favourite 



BOOKm. 

en. u. 



Denn- 

bOitror 

ntilitjrH 

b; frice, 



■ocuuni 
b«iQgUlen 
at pcoplo's 



iuilivli 
cluunwterB. 




Cwwutp—iJiiic Io tbt nMTcnieKt u( tliu "mcwi hii" uf mttrvsuiiaen. Sot 
: L Ch. 1. 1 A. 
* Compkre Mr B4|einirtli'> Malhrmalitttt l'»frJiia. 



1.52 



THE LAW OF DEMAND. 



BOOK ni. 

OH. ][. 



But FQ'dl 

aa tboNB 

lUKiMtod 
vitB we 

tboavorasB 
of lano 
tiviulwrs of 

Jieoplo. 



son. Some who are not vtry scusitive geuerally are yet 
spcciaUy euaccptibic to [>artictilar kindm of pleajsiirc atid puiu ; 
while differences in nature and education oiake one man's 
total capaciby tor pleasure or pain immensely ji^eater than 
another's. So that it is not at all saXe to say that two men 
with the same income derire equal pleasure frora it« use*; 
or that they would guScr equal pain from the same diminu- 
tion of it. Although when a tax oi' £1 ia falcon from onoh of 
two pemons having an ino'ime of £300 a year, each will ;rive 
up that. £1 worth of ploasure which he con most easily part 
with, i.e., each will givK up pleawire that is measurt'd to hin> 
by just i)l ; yet the intcueiticg of the pleasure given up may 
not be nearly equal. ^H 

§ 2. Nevertheless, if we take averages sufficiently bmaul^ 
to cause the persoual ptjculiarities of imlividualH to cuunt^ir- 
bolauce one another, the money which people of e^uo) 
incomes will give to nbtoin a pleiwure or avoid a |MUu U an 
extremely accurate measure of the pleasure or the paiu. 
If there are a thi>u8aud pentous living iu Sheflield. and 
antithor thousand in Leeds, each with about X200 a year, 
and a tax of £1 is levied on all of them, we may be sure 
that the loas of pleasure which the tax will cause in Shetheld 
is almoKt exactly equal to that which it will canoe in Litedn : 
and similarly anything that uicreased all the incomes by £1 
would give coimiiand over ulmont oxuctly the same aniuunt 
of additional pleasure id the two towns. ^| 

And iu fuel it. hapjjens Lhat by far the gri-atwr number of^ 
the events with which economics deals afl'ect in about eijual 
pTOportJone all the different clasKi;fi of society; so that if 
the money measures of the happiness caused by two evenLt 
are equal, there is not in general any ver}' great difference 
between the amounts of the happiness in the two cases. 
If however it should apprar that thv class atfticted in the 
one case is ou the average, say, tc-u Limes as rich an in the 
other, then wc shall probably uot be far wrong in supposing 
that the iDcrement of happiness measured by a given »iim of 



Mr Kdgowortli'* '• Jfevf and OU lltHioJ4 n/ £(ii«," 



DISCOUNTINd THE RTTURE. 



isa^ 



I 



mraicy in the one case is. so far at least as its direct results wo* in. 
go, about onc-teuth us great as in tlio uthfr'. _!_' 

§ 8. So far we have consiclered only proBent gratilicationH; a dlrtmt 
but even greater differeacea arc found in the estimates which ^^'jltraJiy 
difleivut piropl« fomi of distant or deforrcd pleasures. One ^2^^^^. 
ponon Trill reckon a pleasure, which he anticipateH at iiom« *''■'" "">■> 
distaooe of time, at nearly the same value which it would bUuuL 
have for him if it were present or immediate ; while another 
who ha« lew power of realizing the future-. Ics« patience and 
self-control, will can; comparatively little for any pleasure 
that is not near at hand. Thus the savage can hardly be 
induced to take the smalleBt trouble to fence iu cropa which 
a few months latermight sive him from the pains of extreme 
hunger; the ignorant navvy will often spend the eaniingu of 
a proaperouK time in wayx chat give him rm pleasure t^i he 
compared to what he ^ti'iil suffer when his work is elack and 
he has no fund to fall hack <in. Anil at the npjxwit* extreme 
the miser goes without ordinan' cocnforts in order to accumu- 
laU wealth which he will npver bring himN-lf freely to 
enjoy. But the great body of sensible people in a civilized 
country estimate a future pleasure at a lower, though not a 
much lo«-er, t'alue tliau if it were pre^eut : they diacuiinl Ota 
'nture at a moderate rate*. 

The rates at which different people discount the fiitupe 
atlect not only their tendmcy to savi: as the term is imli- 
narily understood, but also their tendency to buy things 
which will be a livitiiig smirre of pleasure rather than those 
which give a stronger but more transient enjoyment; to 
buy a new coat mther than to iiiflulge in a drinking bout, or 
to choose simple fwrnitun.' that will wear well, rather than 
ahuwy furniture tluit will soon [all to pivces. 

A» Bentham says, we must consider the "duration" an<] Thecmotif 
"intensity" of a pleoisure and its "propinquity" or the iieajr- nn'ii^patud 
tteae of the time at which it is expected ; and ftirther we Ig^^l^^, " 

"diw-'uiml' 

ert" iraJuB. 

I Sm bdow Bodi ui. Cli. IV. t 3. 

> If « peraui wwUd ]nit JUkf 9«. tot thv i^-vtUiiitj uf a nrrUi Ileal iotj a yt*t 
'hmat. wlodi U it wan prMonl hv wvoM •ndae •! Ufa. Uiui ha inaj* bv uiil to 
' AmmwrI AgUr* pUaanrM U Ui« rate «f Im }>«r Mnt. k,T«ar: it hf wonld imljglw 
i*. fv it, tium h* JiMviuda th« fnturt kt [■viit;' per cwit., ukil ira «ii. 



154 



THE LAW OF DEMAND. 



BooKm. must take acoonnt of the "certainty" vrith which it ie 
^1^' anticipatod, Th« less that cert^unty is. the less i» the value 
of the pleasure, and with every diniinutiou of the certainty 
the valu« of tht- [jleaaurc diiiuulshea in like proportioa'. 
Everj- commodity that is not oousiimod in a single use, ia , 
the probable tiource of riiaiiy [deasures, more or less remote ; 
and its value to a piiwhascr is the aggregate of the value H 
him of all thc^c pleasures, nllowauco beiug^ made for tlieii 
iiiiKertainty and for their distauce*. 

§ +. We may now look more closely at the ralalioii it 
a^imiiis. which a ptfrHon's demand for a thinjf Ktands to the price 
■n mu.ira- ^jjjpj^ he can obtain it. It will be best to tak«? our 6ral 
illuatrattou &om the demand for tiuch a cointnudity as lei 
which can be purchased in »mall quantities Suppase. fo 
iostancc. that tea of a certain i^uulity in to be hml at irJ 
per lb. A pcnwu might be willing to give 10«. for a single 
poimd once a year nitliL-r lliaii go without it aUogL-thi-r : 
while if he could hovi; arty amount *tf it for nothing he would 
perhapa uot core to uau more thau 'AO lbs. in the year. Bui 
as it is. he buys perhaps 10 pounds in the year; that is 
say, the difference iHitwecn the happiness which he get 
from buying 9 lbs. and 10 lbs. ia just etiough for hiin to 
willing to pay 2a. for it: while the fact tliut he does not biij 
au eleventh pound shews that he does not think that it wouldj 



' 11 tlw l>rabftliilit;r timt ■> lili'Dvorr itiU In' ■iiijiijr.nl jv ihcrv tu uuv. to th 
tUinc cluuiccs ciiit uf !oia mv m Ut faTuur, tUv vnlui; ijf its cipvctation b tlm 
f<iturlliii ut ulml II nuiiM he \1 il vtewe cvrtiuii: t( the |iri>)iiibililj tliat it *i&m 
tWdrne were oiilj wvnn to Dt<>, *i> thnt imlj ■xtith c-limit-m nnt of tvrlrn urc in ila 
tvioax, tbo value ul itn i<I|it'i.'la[k<ii in I9lil<> tt-veiitw^irtluof wlut it wuiiid tw if 
tli« ur«>nt wfTH oiiKAin, mul •« nu. U tliu siiLicijiatud (ilcamira U bntli iinc«TUiit 
■III) liinlniit w>* ItCKv u l*in[ol>t il"'liii'Liiiti Ii> miiliii (nun iU full imloc. W« Will 
i>uii)fBC' 'ui' iualdii>i'«, tint > jarnaii iciraM giTi.' \0t, far ■ |;nitiBeklia«i if it wm« 
])rt»eii( tud riirtnlii. Iwt that il i.i flue it ji-ar lii-tict. anil Um (OuliaUUlJ of tta 
1ui]»[)Riiit]H tbeu ia tlirpv iv uiiv. Su]i|>(tM< ai«o llial iir itlseoniiU the tatan at ths ^ 
r«t«i of twwtity l«r i^oiit. |vnr biiiiiihi. Thiui llit> vaJud In hitn of Uw ant)ri]iatii 
of it lit j X j'fc K ^'^- '■*■ !>•■ I'omparc thu IiitrudixrUn^ clu|iU9- of JcvtiUf' The 
<!f Polttital A'concmy. 

■ It uuHt U.' ULii1ur»ti'iiHl liuncvrr tlist tlip urinriiiv lumuoreaueut of 
elamaot of • plmumrn !> in prariirp ilnnn rontclily b; a mrt of InallMt. 
ouijr meMiimui-ul willi nliich wlaiitu ciu dim-tly ileal ia Uiat ftffarfeal hj what il~' 
jierton is willing to 8MTitlr# (wlietlifr mtfn*^. or midp olh«t ernnHMwU^, or liit 
9WU WKiar) ill uMer to •Muu tbe asgnijatc of plsanim antldpalH fn>BB Um, 
pwwwidoai vt tbe tblsK ItacU. But we iiut« L iu ttia AppoidU. 




te worth an cxl-rtt 2*. to him. That ts, Sc: a pound book 
moasuK* the* utility to him of the tea which lies at tht- _!_' 
margin or terminus or end of his purchases ; it measures the 

MAROIXAL or FIXAL UTILITY uf tea tu him'. THi; Ttlatiou -Worf..-*; 
in which this stands t<» the whole benefit that he gwt-s froiri rnViVj/.ani 
the tea, w ila Total Utiutt, will be considered further ou. J^^^^' ' ''' 

§ 5. It, is an almost universal law that each several Any pw. 
waul is limited, luid that with evory iuereafie iu the amount v.»,di» 
«if a thing which a man has, the eagemt-ss of his desire to JU^JI^hiii' 
obiaio more of it diminishes; until it fields place to the 
desire for itome other thing, of which perhaps he liardly 
thought, so long as hU more urgent wants were still un- 
iBlixlied. There is an endless variety of wautd, but there is 
a limic to each separate want. 

This [aw has intletHl Hotne appiireiit exceptions : the 
more pictures or books a man has the stronger i^ his taste 
fur them likely !« become, and the mure is he Ukely to 
spend on them: avarice ami ambition are often insatiable; 
the virtue of cleauliiieaa and the vice of dninkcimeaii alike 
on what they feed upon, but in such cases our 

BrvatiuuH range over some period uf tune ; and the man 
ia not the same at the beginning as at the end of it, l(ThtiaiPo/\ 
vc take u miku as he is, without allowing time for any Huiten of 
change in his character, the marginal utility of a thing to "riftvj,. 
Urn dimimshcs etcudily with ever>- increase iu his supply 
of it, Thi« important lact may go by ttie name of the Law 
OF THE DIMINUTION OF MABOINAL OR FINAL UTILITY'. 

So far we have takL^u no account of changes in the mar- 
gisal utility to him of moDey, or genetsl purchasing power. 
For at one and the same time, his material rosourcea being 
nnchaaged, the marginal utility of money to him is a fixed 

> J»iTaa*MUiplti Uw lBtt*r of Uiene (umui. But Ihe (omi-nr u«n)ii ]irnti>r»>tli< 
on •nxnuil n( IIm rJoa* rvlaliaii lii wlitcb. ■« wi* sbftll hch- jirnKiiUy. uMrnltial 
Ui&tj iteada (« nurguial c»rt of prodvctiou. The tcnu aiBrKluBl uUlitjr ia la 
n m mffi t ai en tm witb lh« (Itmuiiu term flrnn-mtii. 

■ Bm not* U. In App«iulii. [t ma^ ■>« iinUc«d tliat a p«maD luifiLt be «i]tiiij{ 
U> !«; only ftt a kntn nte (oi ■ pium uf a cjtr^iut iTicnlficiviil for liU riiotn. tluui 
Ur oDa wlii«li vonU uvsr Um wlinlii of it. CaoM «1 tlijii Viad ti* of DO tmru*- 
•Uata amctm lot <wi Imt IIkJt lia*u Mtae lilUr iulorail iu i-otiti*xlvii vralli Um 
UMbu, wbkll w* tbaU pruMuliv diacnaB, U-twMU lUc Law of IHiimiiiihliiK 
DtiUtj and ihn Iiaw ol DiiaiiiUliinB notnni. 



156 



THE LAW OF DEMANa 



tuMK UI. 
uu. u. 



Thu <li>lrl- 

btitimi of n 

uit-a]L>i be* 

tWCl'll tlio 
KTiltilli^ii- 
tton of ilit 

WKUta. 

The Nuoc 

nvM «)ua1 

Belied at 

the uiiirftlii 
(■(cncliinir' 



AOe. 



«]aanlity. so that, the prices hp, is just willing to pay for two 
cotnniodities are bo one luiothur m llie saino ratio aa the 
utility of those two cominoilities. But other things being 
cijub], the richer he bcoomfs, the less is the rnarjfinal utility 
of money to hiin; t^vwy increase in hin resources increases 
the price which he is u'illiug to pay for any given pleasure. 
And m the same wsy uvury cUiniuutiou of his raHourceK 
increases the marginal utility of money bo him. and dimiiiishes 
the price that he is ■willing to puy fur iiuy pleaaure'. 

§ 6. If a ponton has a thing which he can put to several 
uses, he will distribute it between these osea in such a way 
that it h&B the same marginal utility in all. For if it had a 
greater marginal utility in one use than another, ho would 
gain by taking away eome of it from the second use and 
applying it to the first. 

A special ioBtance of this is the case of money. If he 
19 spending so much money on one thing that he g(ts 
comparatively little plciwure from his last purchases of it, he 
will decline to extend them liirther, and apply hia meanti to 
piircrhauing aoniitthing elao which ha« a higher marginal 
utility in prop<irt.ion to it-« price. ITnlpss thereforR he has 
made a casual blunder iu his choice of things to be bought, 
he so distributtK his money among different purchases that 
the marginal ntility of each is proportional to the price hu 
pays for it. 

This nwult is indeed only another way of saying that the 
price which he is only just willing to pjiy for a thing 
(having regard to the amount nf it already in his powession) 
measures and is therefore proportionid to iba utility to him; 
or again it can be rleducetl from the general doctrine that 
everyone wilt try so Lo use what ho has as to make it_ 
afford hun the greatest posdble total pleasure*. ^[ 

§ 7. Whfii we aay that a person's demand for anj't.hing 
increaeea we mean that he will buy mom of it than he 
would before at the same price, and that he will buy as 

' Suit liotn lU- ill Ai>ih:iuUs. ^™ 

) GoRiwn, J«ronR ViA nillunrt hftvn npjiliLwi] Um iiiuUufictJiliL'al tlnx^riiw ut 

muiiiit ftuil muiiiua to prove ft tpt-it uiniiy prvpcmitliiiia ol Ilit* tUitm, Itnt Uugt^ , 

ftc* porluij)* hm abiicnu tu rti|»uu claburiiv |iruuf. 



much of it as befort: at a higher prico. This ia enough doox m, 
for most practical purpones, fur wc seldom want to know ^^' ° ' 
all ikbout a pvnon's doiniLDd for a thing. But if vti did, 
iv« should have bo aucertoiD how much of it he would be 
willing to purchase at each of the prices &t which it is Uliety 
to be offered; aud the complete circumsiancca of his dciuaud 
for, say, t«a can be beet expr^assed by a schedule of the 
prwes which he ia willing to pay for different amounts of it. 
Thus for instanc*) we may find that he would buy 
6 lb. at the price of 50rf, per lb. 



If corrcsiiuiHling pricu were iiUed in for all intermediate 
amounts we should have au e^cact 8tat«meut of his de- 
nuud*. 

We BCe then that a person's demand for a thing is indn- 

■ 8nd) m tlmoAtul *«iitAa\» m>7 bu trntiHktwl, on n iiJ&n ik>w camiug into 
fmfllwr an. i&lo a cun-t Utal ma; Iw trail-oil liu dkuaxd cvrvk. Let 0^ ftwl Oy 
be dnm Ute odd hiJi-i£uuu]l>. tLc wtlii'i ti>rti(mll7. Let wi incU meaaared tkloDg 
<h CTp noan t 10 lb. of lt«. •ii'l cti JDcdi mmuiirtHl »ltmg tjj/ n^nwnit 40i/. T»k* 

P*8. Ill- 



T«nlli» of PortiHtliN 'it 

Om,^€ .ud draw ni^;', =.-.il 



aM,.i 


„ 


„ m^j, = JO 


Om,m9 


■I 


„ M^rjnSS 


0m,<=9 


m 


■ > Dl«pt-i8 


0«i-U) 


„ 


„ IXrit, B>3* 


0M.*1I 


f* 


^ IR^.31 


OMi-H 


»• 


.. >^,=10 


Oh,- IS 


1* 


„ m4>,>18 



M 



° iiiiiiii 

■a, b«bf[ OB Of and n jf| l>«iii|t drtLim rtttirtiUf from m, ; uid m for the oUwm. 
Thau i>i;i| . . . . pt mn potnU on lili Denuutd Cam tor tea; or aa we may a^r 
DnuxD Ponm. If wo couU Am] (li>iiiaiid pobta la tbe aamo uauuor tor eTujr 
fnii*'L' qaantitjr of lea «« ilumld gat tbo whole rautiniioim cvrre tiU' a> *heini 
iBtlwIfai*. 



m 



THE LAW OF nEMAXD, 



BOOK HI. terminate so long as nothing is said as to tlie price at ■ 

cH^ the thing i» to hv hsui. There ia no uw? in trying to measured 

Tlje"'"*"- his (leniancJ an some writftrf have (If)ne merely by the 

itinaaain- "amount he ia willing t^o buy" or merely by the "intensity 

dnuad. of his eagerness io buy a certain amotint." Nothing ia 

gained by rcpreaeutiug a notion, which is really complex, as 

though it Were simpla Wherever precision is required, we 

must Kpeak of a person's demand for a thing a» represented 

by ihi! schedule of the prices at which he ia williug to buy 

diflferent amounts of it'. An increaee in his demand for the 

commodity means an lucroasc throughout the whole schedxUe 

in the prices at which he is willing to purchase different 

amounts of it; and wc umy sometimes Bud it couveoieat to 

speak of this as a raising of the demand seheduW, 

' Tliun Mill HiiyH llikt wc inmil "ucui b; Uu' wonl di-tnotid. Uio ijauiitit; 
ilriiiAti<li.i1, oiii mncinbiir tliat Uiis in uut ^vUxLxIiiuuitit]-, lul lii |[«uuru] raricH ao- 
ciiriliijt' III lliG vaIuv," J'riiifii'kt, Ittinh iii. Cb. ii 1 1). This wtuiiiitt i* hL-iviitiQe 
til lubtdjitiru : lint it U nut clmrl]' «prviiHMl &lj<I il haa been luui^L uuKuiicIifnitnoil. 
CainiM prvlora la npevatntl " il^tii&nil as the iladra lor mtnmodlliM onil nervioi'*, 
Moldtig iu rai by «ii aScr a1 gDnonl parchnrim paniv. luiil luiipl.r •■ tl>» 
d««tir«> (nr ){<rii«ni] piirv-hmuiiK {ww vt wpklnfl \u mii! )>j' ui itttor »( ipvciflc cmiv 
iDodJtkn vr tcrrkc*." He iluM tbU b urUci tliat lie niny be Me In upvtk iit • 
Tktiu. ur «iiialitr. at ikuianil aud saiiiilr- But tbo i|UBiit!ti«i of Cim i1eiiirc« un 
Ibe jiari 'it two itittarmt jtcntniia caiiiint 1h fomparuil ilirectly ; tlifir nieunirm nujr 
bu cutnpared. lial uuL iha; t!i«niH-1ci»_ And Ui fnct Cunioii ii luinindf ilrirtii u> 
■peak ot an]vpl,v ■» "llmlCert I17 tlin qnartit;r al HiMidlir- c^mniulltlM off«n»4 for 
mI«, anil Atnniuiil by Che qnuititf <if [nircliasing power nffanul fnr thwr ]>nrdiaM.'* 
But livllorii linvc iiflt n Hied •ioaiitilir "' mmmwlitipii wLicL thcj offer for Mb 
OUCutulillMiiLUv at wLatvv«r vnuL- tL<^y v8U iivti liuyura liurr nut a fixed quaotjtf 
of pntchMins [Kim-r nliidi llitfj- luv rundjr to iimtiu) imi tbo npcrifli; cfllnlDOillttiB. 
Iioimwr Uttc'li tlmy iiaj- furtb<>ni. Ai^tmnl inuiit tlinij !>« lAkeu iii titber caa* 
<lf tha TvUtlnn iM'ltrnoii i|Uiuilit}r aucl jiri'W, ui urdur tu cuTiipluto CjdmM' Bcc<i>abl, 
Ud when tills U dtmc It t* liron|{lit linrlc to Uip 11im>« IoIIovmI bj UiU. U« 
•aya, iiuUcd, tliat "Denimid. as dofiiicd 1>j Mill, in to lie nudnnbuid u tnfa- 
Muwl, avt, SB my dtJLuitiuu wi>ul<l rcquirr, t>y tlio iiQaulity at |)ur<iiBiunK pontr 
nffind in aniiiHiTt of tliu deHitm tur cuuiniiHlitica. but b^ tlic ijoniititr tif ivnu* 
ntoditiaa for wbicb aucb pufuluMiuK punur le ollorMt. ' It in trni! that tbara Is 
4 gntt dUbraiM batwaen Iba atatmuMtlii. " I will bn; twtdtD rgif*.' ami " 1 nU 
bn^ a ■bUUng'a worth of euic'- " '*>■' tliorci In ik.i ■nlmUiitlTe dilI»t«ti(.-» batwMo 
||]« KlAlKiixc.iit. "1 nrill lin; tu'olve og^a at n pennjr (Mich, but aaij as *l Qjm* 
Italfpcuco vocb," andtlir nlsttuiTiit. "I will aiwDr) a xtiiUiutf un cggi at a ponnj 
CHfb, bat if tbv.v nwi throe Lalfpcncc each I iviU ipcml uiuopoiMe on llicm." But 
wbi]«> CairiKs' aocuniit n'huii tcitiipli^tcil baroiiws aubntaiitialljr tin? «aui« m Hill'i, 
Ibi prflient f orni Is vieii morn nuxlrajlinR. |S«« lui aitirJo bj tlie piewnt wiitar 
on Mis'* Tlit6ry of Value in Uiu Foriniykllp Kf-Ute tat Aptil, l«7il.) 

* Oconutrica]!; tt Is rc]irfiiionl«d bjr raiiiiiK tli<- rlcmniid rarv«, or, what come* 
t« (1m tamv UiuiK, woviug il to Ibe Tight, •ritli pMhapi come modidcatiuu «1 ill 
slupt). 



LAW or DIMINTTinS OP MARGINAL PItlCE. 



1S9IJ 



fn a commodity Uke t-ea. which can he purchased in 

tctnall quoiititiLti, ever}' voirialiun iu price ut likt-ly to ulTKct 

fthe amount consumed by an individual. But there are many 

commoilitiut! — such uk hatit — the dtinmtul for which on th^^ 

port of any single individual cannot vary cnntinuoiiely with 

CTOty sninll changy in prici,'. but can ciiaiigi: only by gn;at 

leapd. A small fall in the price of hats will not affect the 

•ction of cvcrj'onc, but jt will induce a few pcrBons, who 

were in doubt whether to get a new bat or not, to decide in 

I'frvour of doing so. 

Thiw every fiUl however slight in the price of a com- 
modity in general u.*e, will, other thingB b<?ing equal, increase 
[the total sales of it. And thereforo if wc had the rotjuisitc 
ElcDOwledgc we could make a scht^ule of pnci?K at which pwh 
DUDt of it could find ptirchosers in a given place duriug. 
t^ ■ yonr. The total demand in the place for, say tua, 
is the sum uf the demands of all the individuals there. 
Some will bo richer and Home poorer than the individual 
consumer whose deniaud ii^hulule wc have juet written 
down, some will have a greater and others a smaller lilting 
fiir tea than he has. Let us suppoBe that there are iu the 
place a million purchasers of tea. and that their average 
oniiumptiou iit etjual to his at each several price. Then the 
[demand of that place is repre.<»enbed by the name schedule 
[as before, if we write a million pouuda of tea utat«ad of one 
9Mnd'. 

There is then one law and only one law which is common 
to all demand schedulcci, viz. that the grt^ter the amount to 
sold the smaller will be the price at which it will find 

' And Um dctnaod i> rei>rc«nil«d li; tba nnw currc aa hihrv. uulr kU iiidi 
dnng Oi van reptOMnta tm mlUton 
^ foond* toutoad uT t«n pounds. 

4 fonni iatmitian of Uie Draiuit curve tavr te 
grien Ubmat— Tbb detwutd enrvc far anj conunDditj 
in ■ aiwkvl datfui^ »aj p*«ij mint ol liiuv in lb« 
loeiu of lUtuai) poink (or it. Tlukt i» Ut My. It is a 
•arve Ncfa UibI if trun oiijr ixrint r lui it. a iilra>(lit 
iin* PM ba dnvu petpandlcoJar U> Or. I'M rKpre. 
•inte Ilia {nc« al vliieli iMKlnwaH will be lortb. 
Mnlng Ser ah unomt at tha coinuiiwllt; r*pt«- 
\ij OM. 



BOOK in. 
CD. tr. 

Thad«. 
mnDil fm 
till* |iar( <if . 
aiij iiidin- 
■IdkI fiir 
•onio 
Ihinipi 
Ih discoii. 
tinnmifl. 



Ptit ILo kg- 
(Trrgiitii dfl. 
niNiiil of a 
urvat tiiaiir 
[<vrMtiHbaa 

Jl I^OI]-. 

Iliiiiunii 

Bflu^lllO. 

■liowUiit ■ 

nand priea 
corra- 
spondbslii 
•very In. 
oToawfai 
tlic qnaii- 
tity du- 
OMJulad. 



lit Dlminii' 
tion of 

UarElTial 




1«0 



THE LAW OK DEMASD. 



IKKIX tu. 

on. II. 

TLeiii- 
flucacv ou 

I till srowUi 
of a rival 
com. 
moditj. 



drill Mul 
Mid 

Ud. 



purchflBers; or iii othtr wordi*, as the luimbers in the left 
hand cotumnM iiicn.-u»c, thoav lu the ri^'ht haud columu 
diminish'. Subject to this oq© condition, demand schedules 
hftvc cvory varioty of form. ^ 

§ y. It must be remembered that the demand schediil*™ 
j^vcs the prices at which various quantities of a thing can 
be tjold in u market duriu); a given titoe and under f^iven 
conditions. If the (■■inditionH vary in any respect the figures 
of the schedule will probably re-quire to be changed. One 
condition which it is e^fwcially important to wntcb is the 
pricn of rival' eoiumudiUee, tfmt is, of commodities which 
con be u.si,'d as KubstituteH (nr it. For instAnoy. the deiuaud 
schedule fur tea is drawu out ou the asKumption that tliMJ 
price of coffee is known ; but a failiirt* of ihe eoffw hjirvesl" 
would raise the prictw throughoul the demand schedule 
for tea. ■ 

We have so far been looking at demaud chiefly from the 
point of view of thit ultimate consumer. But, na we shall 
see more clearly hereailtr, the same law ap]>lie« in tin; trade 
demand for things which are to be sold again or are to be 
useii ill making other things thai arc to be sold. An appa- 
reul objection arises from the facta that when a thing is 
&Iling in prici- di:alcrs ofV-u contract their pnrrhaseN in the 
fear of a further fall; that when the price is rising thi^v 
ofttru buy largely iu the hope of Becuring the beneiit of a 



> Tluit iit. if a polul uiotm iIuiik tlit- turvv nua; truin O^ it will r^n^tiiitty^ 
tlrproull Or. Tlinmtiirv if a slnitftil liiin /■Tt4< ilranii lonrluiii.: iln' nr. i,t 
P ind mMtins Ox in T. tlio niiglc FTs U lui abtnu anflci. Il vUl U' l.iiiiiil .viti. 
tmiMit to bav* n ahurt way of «xiiT««tiiig tUa faetg wliloli lua; be iLoiic I7 ujii^ 
that PT i» invuKsn MKoATn-CLV. That tbo ons OJiivortial rule to yhixh llic 
Deiiiaiiil mm- caiifonua la tliat it Is inrlintd tuyafirtly tlir<rii|;l»iut Uio Ttliule at 
ita LmiitUi. 

■ Or to DM! Jevouir' |ibrii*i.i ( T^nti? (>/ PoUlirnt ^'crmciinjr, Qi. iv.). riniuiio> 
illCIrs tliat am ciiiarl)- "K]alva1mit." TIm <iu«i>l[uii wlwre Uia Unni of illvixloii 
btttTMC diffnoiit ronwro<lltkii« can bo ibiiini nniHt lio sKltleid tiy th« POiivt<iil«>iic<< 
»f Uia> piirtiroUr <]iiiuiti<in mulcr iliKiuBian. Km *otnfr [ntipaiua it may b« Wat 1.) 
regard CIuuckt euiiI IuiUbu t«ui, at nrvu Snanhaitu auit lVki>e U«» «i> •USpreiit 
iwiuuioililiva : ami Ui baip a BOiMrati^ilcniaiiit tcbnitnlr tor vsl'L <4 tLinu. Wliilv fur 
oihuT imrpcwcs it may Iw butt lo i:n)ii|> U>|ii^Ui(^t cuiituivilitiei n* distinct, aa WH 
au<t iLiutluu. ur uit-n an Iva aixl cntTm). and to have a lAnato wbedatv Ui ivinvniii 
Ui« dmuaiiil tor tbi! twu ftimbiiiL'd: but iu aiicli a 'Caau of raunut kuiiid eauvi-nliim 
tnoiit be tnado as ti> the iiuiubcr of aiiiuwi of laa wlil<'li uv takan aa »<iiij««laiit lo 
a pooijil of coOo«. 



MUUirVlNU CIRCUMSTANCED 



irther jise; aoU that speculative puroliusca of this kiniJ nfo« m 

have u very jjrcat vft'uct ou the bctnporarj- fiiictiiutiotu< oC _! ^' 

prices. But this is not really an exception to the rule: it 
only illuBtmtes the way in which the expectation of & fall in 
price will often diminish people's eagerness to buy a thing at 
the present price; they will prefer to wait till the price has 
come down. Apparent exceptions of thuj kind are a liource 
of difficulty in the theory of maik^'t. disturbanues : but thay 
httve no real bearing on the relation butwuen denuuid und 
price in a steady mnrket; and looking only nt nnmiiU and 
averagV) results we find that the eheapLT n thing can bo sold, 
the larger will be the pnrehuties of it by private consunienj ; 
and therofore traders will buy the more of it, in the long run, 
the chtaper they can get it. 

Later on we shall have to examine the lagging behind of 'ninni*- 
that increaHed consumption of anything which ih mire, other uuu,. 
things being eijiial. to rt-sult from a fall in its wholesale priw. 
This logging behind has many curious cftcctH, sotnu of which 
are of great pmclical importance. But at the prc^^mt stage 
we may negli^t them ; and asKiiine that changes in the 
demand price of a thing nill follow instantly on changes in 
the amount of it oflennl for Hilt- ; and that the demand price 
for any particular amount which is being offered for sale 
will always l>e that price which i» st-t ugaiiiHt that amount in 
the demand schedule reprcHQUting the normal rclabians of 
the market'. 



> DttcuwoiM kindiid to tlio*o in tbo proont cluti<t«r vo to Iw found iu 
JffTOBS, Titorf. Ck. a. 1)1. : UBU|,-er. VoUuneirfAKlmfijdehrt, Cii. u., «id Bdhn- 
BMrark, O n miti ti*. u. It. 



11 




nau4. 



1 . We Have «h<>u that t\v± ouly univeraal law aa to a 

persou's desire for a rommotUti,' is rliat it. iliminitilies, o^er 

things beitifj (*i|tial. with c-wry iucreaae in lais supply of thai 

commodity. But this diiriinuiion may be slow or rapid. If 

it in slow the prici; that Ko will givi; fur the commodity will 

not fall much in oon3C'([uoii(:c; of a nmsidrrabUr increiisi* in 

hiis supply uf it ; uod a small fall in price will cAuae a i;om- 

paratively large incnrosi.- in hiK piin:liaM»:. Rut if it it rapid, 

a Mrnull fall iii price will cause only f\. very sriioll increase iu 

hb purcliAseji. Iu the fonuur cuav hLt willinguces to purcham; 

the thing stretches iteelf nut a great deal under the action of 

a small inducumeut : the elasticity of hia demand, wc may 

say, is great. Iu tb« latti:r caino tlie extra iaduceineut given 

by the fall in price causes hardly any cxtousion of his dcdrc 

to purchase : the elasticity of hia demand is small 

And as with the dom&nd of one person &u with tKat of a 

whole market, The ELASTICITY OF demakd iu a market is 

groat or small according a« tho amount demanded iucrcaw» 

mu(;b or little for a given fall in pricp, and diminishes much 

or little for a given rise in prioo'. 

SpcaUnK luorv mactlr n« uiu; vn? tlitit tb« tduUdtyof lUnualU ' 
tall nt nno prr nmt. in iirirr Hill mnlir mi inrriinnc nf 
one per ta-nt. in the iitiiDiiiil iIpiuaikIhI ; tlial II i« 
tmi ur a bnlf U a fnU uf utio fwr mill, in \\r\tr iubIifji 
an liKTMiu- nl iwo or oii^ lialf per Miit. napMtmly 
ill Oiv uiirmiit ilmuaiuJoil i aud *o an. Tb*«la«U«ity 
«f ilmuuiil can ba bcol tnotd ia tbs danaud rarvo 
Willi tlic a!4 of kba Mknrlng rnloL Let a nlraijcbl 
llni^ t(iu<?liiiiK Ibo cnri't at any iwini /' uimil V-r In T 
anil ",v in r. tlmn Iht mr-aiurt ti/ Ih* rla»Hi:ily at 
liejmiai I' U Ikt ratio q/ I'T r« F1, 





It 80 hig-h relotively to ihf jHtor 
man a* to bt- almost prohibitive, may by Hcareelj Celt by the 
rich ; the prior man for instance ncvtT l4i8toa wine, but the 
vui}' rich mau may drink m much of it as he hati a fani'y fur, 
without giiing hinuBelf & thought of its cost. We shjill 
Ilien'fure get the clearest nuliun of the law of the elasticity 
of demand, by considering nne class of society at a time. Of 
ctwiw then* are many degrees wf richne»i among the rich, 
and of poverty atnung the poor; bnt for the present we may 
neglect these minor Kubtlivi>uuiis. 

ffTiHQ the price iif a thing is verj- high relatively to any 
class, they will buy but little of it : and even a very conni- 
iJerable fell in the price will cause no great increase in their 
orinsumptiou, i.e. the plai^ticity of their lU-maud will be small. 
Bat if the price goes on falling they will begin to consimie 
the thing more Ireety, taking it into onlinarj- iim-: and the 
f iaistidty of their demand will iiierea»c. At la.st a price is 
likely to be reached m hjw that tin-y have got all that they 
want — a satiety price ; and then thej- will not be induced to 
[increase thi'ir conKumption much by any further fall: the 
nty of their demand will again have become small, 
ia to !iay, (he elasticity of their demand is smalt when 
of a thing is verff high relatively to their meaiis aiid 
when it is verif tow: while the elasticity is much 
it«r for prices intermediate between what we may call the 
hi^ level and the low level. 

This ndc appears to hold with regard to nearly all commo- 

!irio8 and with regard to the demand of overj* class ; save only 

'that the level at which "very high" pricpj* end and "high" 

prices begin, is different for ditfentut classes and m again is 

the level at which " low " prices end and " very low" prices 

begin. There are however many varieties in detail: arising 



A. iiHoe 
wludils 
low rif- 
latlTrJr to 
Ihii pun- 
in ui)i I till I 
u( lllr rii'll 
uiBirK-lii|;b 
ralalitaly 
to Dial of 
U)v poor. 



ral htw of 
i'mIaUou 
ol LliP cliui' 
lidlTofilo* 
niknil 



Ifcon- 

wiUlKMWt 
rkriolJM of ' 
•lotaU. 



Jl /Twwe twko Pt.o taO of I perctul. in prii-i' w«ulrlcims« nn inrrrawt nf 2 
Bl.. in Ite kmoDnl (ImduiiIrI; tliv vlMticilJ ot <l«niauil noiil't Lv two. It 
■• mv-Uiinl otrt.M fan of I pvr emit, in prim vrtmlil (-«uhi aii uirtrasu at \ 
ftfv MM. !■ Urn uioant i1i>niaii>If>'1 : tlw dMtlrltr of dconancl wnnld Iw iniR.thin) : 
■ndftfon. Aii«4faer way of looldnt; at Ihc tame ncnll Ih lliint — tli* ulAntitrity at 
tfce poiDl /■ i» iiw«nu«l t>j llir ratim-f /Tto Pi, tlmt U ol UT to if OiJ* if htaiig 
4nmt pmp(ti4lc«lAr to Omt ; tuiil llivratimi rJlr floAltctljr inc.ifMie» tehircrtr (Ar 
a^t TPM immuM rrkilintf to rit amgle Ol'Af. See Nule IV. iu ApixmiUl. 

11—2 



1(14 



ELASTICITV OP DEMAND. 



aooKiii. chiefly from the fact that there are some couiiuoditics wit} 

_! ' which pKojiIe are eafiily Hatiutcil. ajid others — chiefly things 

used for (lisplay — for which their desire is alttiuat uulimitctl. 
For the latter the elasticity of d'eniaml remains cousidcreble, 
however low the price may fall, while for tlie former the 
demniid Istses nearly all its eUbsticity aa soon m a low price 
has oucu heun reached. ^M 

This rule that the elasticity is great for medium priced 
and Aiimll for tiiose which are very high &r very low ik seen 
most clearly when we select for observation a set of people, 
who, though sufliciontly uumerous to prevent individual 
peculiarities from obtruding themselves, aro yet eeoao- 
micaily homoj^eneous ; i.e.rhave nearly the same wants and 
nearly the same mcftos of gratifying thorn. When wu add 
together the demands of several such sets bo iw to get the 
aggrejfate demand of a larger group, ns for instance that of 
the whole bixly of the rieh, or tlw whole bwly of the middle 
cluiiw^, or the whule body of thti working cla^t^^; our rule 
does not show itself with so clear an outline, and hut faint 
traces of it remain when wo add together the demandH of 
those three groups so as to get the aggregate demand of tl 
whole comoiuuity '. 



> IjkI. UK lURKlratr' lij ib« case of tlic iliaiuuiil for. Mijr, gr»m ji«u Id a Ui«u E» 
vrliicli sit vt>iivli>!il»" UK lioui{lit Btiil wilii lii law markft, Earlr fa Uib ukbiiii 
[wrhnp" lUO ib. a ilay will be hruiijilit lit lumrkot Biiil ■cilil al I«, |uir IIi, . Ial«r ou 
9OOII). will h^ hrivagiit uid mill al tW/^ UKn- on UIICI lb. &t tJ., UU-t still C,illK>at 
3i/.i aiul liit«r *till 10.000 at IJiJ. Tliii dcinuid It ropttMvutu] in 6n. (1), an iucii 
atimg Or lepToKatiug S.OOO lb. uul bd Uidi bIouk Oy npmaenUiig IIW, 



ifi 



n^W. 



ftm, = -flrl in, 
Vm,= -1 



M41, = I-S [n. 

■IV. = ■* 
JV«= -a 

U,Pt^ -16 



ILLUSTIUTIONS. 



let 



§ 3. There are some tJiiogs the current prices of which "«« »>- 

in this country aro "very low" relatively cvud Ui the poorer ' 

classcH ; auch are tor instance adit, and many kinds of savoure J]J^^»j, 
and flavours, and aUo cheap medicines. It is doiihtful Itviu tbu 
whether any fall in price would induce a considerable iti- putUnUi 
crease iu tho coosumption of thoeo. oiu^ 

. Bail <tr*irtn][ m mrre tbronxh />> ;■,-./> wa |[«t tho total ilfuiiond mrvo. Hot Lhi* 
tAU3 dcAiiuul will lie miulf np et tb'> di-muiilii ttt tiie rirli, Ui« miildSs vImh anrl th« 
pw*. Tlio noioiiiitt (liiit tlioj nil] Mt-maUv iIpiiiaihI iiiay pwhapK b* rqircMntad 
Igr tho (eOwinng ikJic4b1m; — 



bt pOUM 

|NirlK 
13 


rich 

too 


6 


900 


•) 


MH 


1 


MO 


M 


1,000 



Number of Ibi. boniilit l>]t 

middle dawi itHir 



tutnt 



.6 





100 


aoo 





GU 


400 


lOi) 


1,000 


S.500 


1.700 


5.000 


4.0IX) 


6.1X1(1 


KLOW) 



Fw-m. 



(Fig. 6). 



Fig.CT). 




V 



■n 



Tbaat odM^sIe* nn truiaUtcd lutu irurves il|-. |5). (6). (T). ihniting the detnAiiito 
of tba ricb. Ui* toiilillr rlain mirl tlin poor n>iircMi;iilMl uii lliu suiie m'oIl- at Hg. it). 
Ttaufnrbutance Jtf. ilA' uul fcV. each at Uium rtfrownto • |irir« of ^, and 
■8 taabM la l«aBth: OH •= -16 Iu. KpTeNentiug goo lb.. OK =^ ■& iu. ra|>raiioiit. 
I« %UIO tb. Mul !>/.<= -34 ill. r«]irn>otiiiiiV 1.70U Iba. wlule 6//+ OK *0l. * 
4Mte t&cb Le. ^ Om, 111 Ax- 1 ■« Uicjr aliuiiM do. 

Tlila aiaj Krva m mn cxainplc nl tho wnjr Id wbldi Mitral iMtrtial dvmuid 
otrTM, di*m lo tho mido train, cui Im M|wriapcNMa hariscinUllj An on* 
ciMthar la makw Uia total d«iuuid cumv rapraaMitliig the iig|;T«g8te ul Lku iiarlid 

L(Ktk»>g aUha *t III* MhitdalM, r# at thf> mrvM. «ra ««•• IIibI tliv icr«*tMt 
shatlclly «( tonanil ia Mm«ivbGr« alHint iLe ytice at Sii. fur llic ricli. ami ad. tor 
tk« inUdb claM. wbik fnr Ike jiuur il in atMint 3it. ■ lor tli« nhule laarkct It ia 
i«tMr( about W. At til* ttW nt I J./, thn ■iMuuiila of the riiiU iDil mCiliIla 
l»T* loal Bewly all Uioir aloolidt}-. Bnt tli* lU nuuid ol tho pocr ahowi 
rfpw <f PHiwtiitag •Iwtic «T»n for luiwh Inww price*; and ahiM ttataAnMiM 
p>a|iiiMln alw ban, a Mondimble plarticilj i* aboim bj the total dtinand cimv 
Jar ilw Imiv |>low. 



166 



^LASriOITT OF DEMAND. 



BOOK m. 

GH, ni. 



Till' dc 
inAllil tnr 

MNlMt. 



Thf riirrent prices of meat, nulk, butter, of wool, Ol 
tobacco, of imported fruits, nntt of onlinar^' niedico] attend' 
aiicti, are Huch that every variation iu price malms a 
chaii^ in the consumption of them ty th« working cl 
and tht! lower half of thw middle claases; bui ihe ricli woul 
not moch increase their consiiniptiou of thum* howevi 
cheaply tliey were to be had. In other words the deniau 
for the.ie commodities is very elaHtic on the port of th 
wO'ikiug aud lower middle classes, but not od the part of t 
rich. But the wfirking class is so numerous that their cou 
sumption of such things as are well within their reach 
much greater lliuu that of the rich : and therefore the aggro 
gate demand for all things of the kind is very ^laAtic. 
little while ago sugar belougud to this clues : but it« price ia 
England has now fallen .10 far as to be low relatively even 
to the working cIujshus, and the demand fin* it 12 tberofore 
not elastic. 

Tho current price* of wall-fruit, of the bolter kinds of fish 
and other moderately expensive luxuries are such as to make 
the consumption of them by the middle class increase much 
with pvery faU in price; in other words the middle class d''- 
maud for them is very clastic : whil« the ddmands on the 
part of the rich and on the part of the working clnss 
much teas clastic, th« former because it is already near! 
KHtiatetl, thi> latter because the price i.i Htill too high. 

Tho current prices of such things lu; rare winiw, fruit out 
of season, highly skilled inedica] and legal asstslauce, are so 
high that there U hut little demand for thum except from 
thi* rich : but what demand there is has in most coses con.* 
siderahle elasticity. 

§ 4. The case of necessaries ia exceptional When tb 
price of wheat is very high^ and ^ain when it i» verj- lo 
the demand has very little elasticity: at all events if we 
assume thtit wheat, even when Hcurce, is the cheapest focxl 
for man ; and that, even when most plentiful, it is not con> 
aumed tn any other way. We know that a fall in tho [iri< 

1 Witli nfganl (>> IIiih ic'^"!' "' voiniuiKlitic* it u iiujuriiuit lu rnuiftik tliat Uie 
ilmoftnd ot tli« rick ia Dot licro lakeu W uidado tin dvuuud lui tb* titoi. «(v. 
wbioli Uiey Ki^o Uielr wrv&ats. 



I 

Jt 

SO 

im 

I 



SECESSARtES AND LfXlRlCS. 



' fif a quarlvni loaf fruin Qd. to id. I\a» .-icarcvly any cff«ct iii 
iucreasing the consumption of bread. With rt^ani to the 
othrr eDc) of the ncali: it ik more difQcult to »pt:ak with ccr- 
taiiilv. becautie there has beeu uo approach to a twarcity ui 
Kuglaud eiucu bho repeal of the com 1aw9L But, avaiJiug 
onraolves of the experience of a less happy time, we may 
suppose that deficitti in the aupply uf 1, 2, -3, -t, or 5 tenths 
would cauiw a rise in priet^ of S, 8, IS, 2H, or 45 tonthsi 
respectively'. Much greater variktlons in priceit indeed than 
this have not been uncommmi. Thus wheat Hold in I^ondon 
for t*-n fihilliags a busliel iu 1835, but in ihb fulluwiug year 
jt sold for ten peocti. 

There may be even more violent changuB than thiH iu 
the price of a thiiif* which is not necfssary. if it. is perish- 
able and the demaml for it it iiiela-stlc: LhiiK lUh may be 

■very dew one day, and sold for manure two or three days 
later. But such rasps illustrate the theory of niarket varla- 
tioiiB of prices rather than that of normal demand. 

%Tieat and other cheap vegetable foods are the only 
things of whioh nearly the whole conswmption can bo regard- 
ed a!) necesiiary. Some part of the coiioumpLion of water, 
clothing.and house-room ib indeed strictly necessary, but there 

lis much of it which could ht- di»pcn.<(ed with. 

Water is one of the few things the consuuiptiou of which 

'we arc able to observt' at all prices fixim the %'ery highest 
down to nothing at all. At moderate prices the demand for 

, it is very ehustiu. But the uses to which it can be put are 



HOOK in, -< 
CH. in. 



Commo- 

'litita 

]i*rt at Um I 

rouraniii- 



FSn- (8). 



' Thia b Um bUMOH ratluiatv qtuiUil bj' (IrpGui? Kktf. h In rui>r«neul«l iu 

fltf. (S| bj Itw mm Dtf, Uic puiiit A 

mmiainiidliiit U> tli* urilltiarj ioIck U 

■• lilt uwomi ul Liu- tael Hut wlioni 

llw |irlM of wbrkl U vary Imr, H tntjr 

ba iu«d. •■ ll wait fur iiinUiiifo iii LUS-l. 
, tM f«*duic otitic and i>h«>i< anil |>i|^ and 
IIBt brcwIliK aiiil •liBtilluii;. Uie lower )iBrL 

at tlHi rnrve woald Uko a rihii\tc iwinir- 

wbal Ul» UiKt of UiBihittml liup in Dii' 

■fnn>. Aod if vw UMitur Uial wbeii Uw 

jKVBB Is *W7 itigSt. Gb(M[>»r uibHillutiw 

latt ba got (or it, llw oppui |iart at lltu 
\ rurra wottU lalw a iliafic ■iinilar tu lUat 

[•f IbaiVrwilattaaiiM. 



4 



r ni henijSf Minpifltf ly niieu : ana as its price 
wartU zero the tiomand for it loses its elasticity, Noorly tho 
aaioH may b« Raid of salt. Its price in England is 90 low that 
the doinand for it iw lui art-tple of food is vwy inelastic : but 
iu India Ebi> price ia comparatively high aad the dumaud is. 
com|]ar8tive1y tJastio'. 

The price of house-room on the other hand hns nevi 
fallen very low except when a locality i* being deserted bj 
its inhabitants. Where the coodition of society a health^J 
H,nd therL- ia no check to general pruMpcrity. the demand for 
house-room scents always to have great elasticity. _ 

Clothing fulls genemlly under two heads: some kinda ar«l| 
dc-rired not only for their direct uata*, but also aa a means of 
aiieerting social position. They are to l>e classed with house- 
room ; the demand Ibr them is itiHatiahlc. But llm deinre 
for bhos(; kiud« of ctuthijig which are not used for the purpose 
of display, is satiable : when their price i» low the dor 
for them litut scarcely uny elasticity'. 

% a. So far we have assumed the requisito facta 
available: but. it will be well to pause a little to consider the' 
'"** 'wT 'I'ffi'^""''^^ '" ^^'^ ''•'^y of ascertaining them. Thia inquiry ia 
twiio- important ou its own account; and it aflfords an inslructire 

ilhiHtratiou of the di'IJicultic« of interpreting statistic*. 
finilftlic A demand iiohedule ia supposed to jireaent a .terlcs of 
*rfttM prices at which different amoimla of a commodity can find 



of 'ililain- 



urpose 
to b^ 



Omm 
muluit 



purchatteiB during a given time in a market; and the first 
(Jifticulty is to define the morkot, Thooretieally a mahket is 
a district, small or large, in which there are many buyeis and 
many sellers all so keenly on the alert and so well acquainted 

I S«* Sir J. Stwrlicy'K ftiia»,e-i p/ tndia. Oi. wii. 

* W» piuat liivirnvsr rrmoniber thai tlic •?hu»«tfT of tlvo ijpiuftnit k-IiwIii]* lor 
uij coBUuodilT dupvudii in n kcvbI ut-amint uii »li«tlm tbv prioe* u( il* rivalH uc 
Ukeu III bv ait'<l or Uf ullcr « ith It. If vf v t>cij«nl(il the rliiiuiLiiil tot Uh-'I Irufii 
tliat fur iniiUun, anil iiiipgH»Hl Uvr pricr uf Mtntlon tii l)r> hrJil tUod wliilH Hut lor 
biwf vai niinMl.LliDu UictluiuHLailfuT hfet wuuhl Ih<i>oiui- «ilrDiricl}> nlaitic. Fiiranj 
ill^lii InII lit itii> [irlf4> ol hMl ironlil »na« It (n l>« OMd IkTvelj In Uis pliae tM 
iiiulloii mill l]]u> U-eA t'l a very gtvnt incn-niic uf tt« c«ijmnq)t40D: vkil* on Uw 
othvr liBiid e-rea & amall rise in |irici; wcrnld c-anu niony prnplc to tmX matlnii 
to llii:' itlriimit «iil[rc rxrltitloii of Itevt. Ual tlir ileuiatnl ti-lipiliila for all IIiiiIh of 
fmli uivni lakcu tiiKflliei'. llirir prir<'> Ix-iiiir ■ajipiwi'd tn rstKin alw>^ abntil lbi> 
Uiiin roUticiii luntio lUioDiiir. Ltiil tnbn iiiit rnrxdlffercgit Innii tliOM now [nnflf_ 
Ing in Eiiftlanil, hIiows onlf > mMLerate olftitioity. 



DIPnCULTlCS IN THE INTERrRETATIOS OF STATISTICS. 



with cue anotht-r's afiaint that the j>rire nf & mninnKiity is 
alvajm jinurtirally the t«me for the wliolo of ihe diatrict. 
But the £bctA seldom corruspoml ouictly t«i thb duscription. 
Those who buy for their owq crmsutaptLou, and uot for the 
porposea of trade, arc uot always ou tbu look out for fvc-ry 
chftD^ io the market : they have other things to think abuxit. 
Again the geographical limits of a market iLre seldom clearly 
drawn, exoopt when rhey art' marked out by the siia or by 
cudtotn-house banicrs; and it in very diflictilt to aHcerLain 
the otnouni*! even of imported commodities that are being 
coDsumed in any artificially deBiied aj'ca, midi fur iiiKtuticu 
u the Staffordshire Potterie*. or a Btraggliug large town. 
And no country ha^ accurate ntatisticu of commuditiHK pro- 
diu3ed in it for home consumption. 

Again tlit.TL' iit generally Home auibi^ity even in such 
ataUHtics as are to be had. They commonly show goods as 
entered fur commmptioii ax nuun as tht^y pa^ into the hands 
of dealers ; and coiii>e(|uently an increase of dealers' stocks 
cannot eaaily be distinguished from an increase of con- 
mmption. Hut the two are governed liy ditferent. causes. 
A rise of pric«a tends to cheek conaumptiou ; but if the rise 
is ejtpect<-«l tu continue, it will pruUabty, as hiut already 
been noticed, lead dealers to increase their si-ockti*. 

Next it Lft difficult to insure that the commodities relemid 
to an> aln'nys of the sanic ipiulity. After a dr^- tiummer 
what wheat there is, ia exceptionally good ; and the prices 
for the next harvest year appear to bo higher than they 
really are. It U pobsible to ntakc allowance for this, par* 
Cicularly now that dty Califomiau wheat affords a st^aadard. 
But it i^ almost impossible to allow properly fur ihe chun^;^ 
in quality of many kinds of manufactured good>^ This diiK- 



(in. Rl. 



and iU 

HlUlt of ll 

arum. 



itj ilniiliT*' 
KtOCk* I* 

apt tu Im 
miitalu'n 
[or ut in- 

OTMHOOf 
(■onauntp- 
tion. 



Chaiig«> 

•lUltJllj. 



* III oujiiinlnfi Ik* •Sm-Id at uxAtlun, it i* (■lutmnirjr in riitnpfm Iho fLtiinniila 
«ul4Twi for tauvmBptinm jatt tvfun aaJ intl oftvr tho iuipoKilimi ot tliv lax. Bat 

}i» iwtniMwaTllij. Fot il(«len unticipntioK tliu tux la; in Ursc (tuckt jnit 
I it !• iiniMiMd. suil iinsl lu bu} rury UltlE fur ouiue tiuic aftuironlfl, Ami 

mrrt nhnt ■ Uji ii loviTnl. Aitalii. IiikIi Uxm Irwt to lait» ivtnni*, For 
tatbutm Ui« nuwinal hnportatiuii <if iimlimMi iiihi Voatoci IncveaMtl Ulijlohl in 
MniHiqMnn of Um Ux b«ni(i ]ow*r«d by th» Itoehlnghun UitiUtr;^ in I7IW. tram 
M. ti> |iJ. psr KaJkni. Bnl Uii> ii*s rhiaHj don to tlie faol tliftt witli tbc t«x 
at lif.. U *&i cbM|i«r lu pa; thr lint; tJuui to nniiKid'-'- i^co LMky'a Saglaiai in 
d« Ktgiutiti* Onii-y. Vol. m. Cb. xii. 



170 



RLAtmCITY OF DEMAND. 



on. iir. 



Diitnrbiuii 
nmiiea. 



Tlie vId- 
Diflit ol 
tiioft- 



wliotbnr 

liennan' 
oat, 



IHWW7: 



culty occurs evon la the cuso of such a tldag an tea; We" 
subetitution ia recent years of the stronger lodian tea 'or 
the weaker Chiuecic tea has made; the real increase of coii^| 
sumption greater thaii tliat whiph Is .'ihnwn by th« BtatLitics, 

§ 6. Tilt' u.bovo ditticultic-» arise chioHy from tlic fciulti- 
uess of our Rtauntiral rcttims. But there are othem the roots 
of which Ik U«ep«jr. ^| 

Tims tho demand Hchfduh* rpprpsonts th« chang[« in^ 
tho price at which a coimuodity can be sold toiisequent on 
changes in the amount offered for enle, other things being 
fitliud. But in fact other things scldum are equal over 
jieriods of time sultieiently long fur tho collection of full 
and truBtworthy stalistics. There are always occurring dis- 
turbing cause.'* whose effects are mmtninglw] with, ami 
v&nnul ea*ily be sepuiuted from, the effects of ihat partieular 
oausB whieh we desire to isolate. This diffieulty is aggra- 
vat(?d l»y the fact that iu ecuuonittt* the full effects of a * 
cause seldnm come at once, but often npread themselves oufc^ 
aJ'tei ii hvu! cea^d to exint. ^M 

To begin with, the purcha-sing power of money is con- 
tinually changing, aud making it uecessnry to correct the 
resuIt^K obtained on our assumption that money rotoiius a 
uiiifonn value. This difficulty can however be overcome 
fairly well, sinco we can aaciirLain with tolerable accuraii^^H 
the bnjader changes in the purchjising power of money. ^B 

Next conie the cliangCH iu the gcDvral prospcnty and in 
the total purcha.'sing power at the disposal of the eoniimmity 
at largi;. Tht intimiuce of these changes ia iuipurtant. but 
perhaps less so than is generally siippueed. For when the 
wave of prosperity is de*ceudiug, prices fall, aud this in- 
creasi*e the resources of those with fixed incoioe« at the 
expense of those whoso incomes depend on the profits of 
buuoese. The downward fluctuation of prosperity U popu- 
larly measured almost, entirety by tliM conspicuous lusseo of 
this last class ; but the statLitics of the total cunKuin]>tion 
of such cummudities an tea, sugar, butter, wool, kc. prove 
that the total purchasing power of the people does not 
meanwhile full very fast. Still there is a fall, and the allow- 
ance to be made for it must be ascertained by comparing 



7UE £L£HE.NT UF TULE. 



fic pncwt 
posisibli 



and thu 



conHUH) pLiou uf tm uuuiT ifaiugM as bookiu. 

Ull. to. 



Next come the chunecs duo to the cradual erowtli of '"^ 'l' ■*"■ 
populati-m and wealth. For these an easy numerical cyriec- •naoWih.J 
tiuD aw be niiulf: whcu the- liictn are kuovvu'. 

§ 7. Nest, alluwauce must be tnadc for chaugL-ei iu l&fbion, Ondiuii 
and t«9tesaDd habit; for the opcniitg o\it of new uses of aimbiuHi™ 
commodity, for the discover}' or improvement or chcapotiing UJif,^ri[v 
of other things that can bi^ applied to the same tiWiH with it *'."■ "f" , 
In all those cases then? U great difficulty in allowing for thu uu« ivay. 
time that ulaptu'H hetwo<^n an rtcfuiomt^^ muitii and itH effetrt. Uiwu- 
For time is rAquirt-d tu ouuble a liut- lu tho prit-t* of a com- 
modity to exert itit full indnence on ainMimption. Timti is 

.cunxl for coDsiimurs tu bceoinu fainiliar with stibstitiites 
call h«! used instead of it, and pt-rlmps for prudiicers 
to got iuto the habit of producijig thciit in suOicienl (pian- 
ttti«». Time uiay be aUu wanted for the gnjwLli of habit)* 
of familiarity with the now commodities and the discovery of 
mi;th<id» of ecoQomiziiig it. 

For instance when wood and charcoal became dear in Uln" 
Kngiand. familiarity with cual as a fuel grew slowly, tire- 




Fi«- m. 



1 Wbeu A. ■Ulbtickl tablr aliona tlic grtiluil i^bUi i)( the cnUKnniiitiuii irf > 
aii^itf onrr a Imif; xvitM iit frsn, no may vaul to foiui'ikn! this jwrrniiUga 
Igr wUcIl it IntnafVK in diHrmil ;eani. Thin cmn bv 
pvat^ caaflf witli « btUn pmctlm. tinl tiiu-.u tbc 
I an (Ofnuad in (Jie fcirm at nutiatical iliiwrBUi. U 

MtUWC Mallr bt dooa, mtbout truwlalJItu ttii< liiutfnta 

Isfilt Into AgBTM. And thii it k ra-aix- ol tiii! ilUfavoiir in 

irbkli wwir atAtbllclMa hoM tlio craptilr luclliud- But 

lij lb* IdkikM^ of uDu ■iiuple niLv tlir Ualanfv ukii W 

lamed. *o far u Uua iwiiil k""- i" £11111111 uf tiie iiniirlilc 

BBtboil. The role in ki follown: — Lot tbu qoBiitti; of « 

ranmmUijr ounaaiiin] lor at ltail« carrlnl, or 4if lax lovjnl 

ttc). b> mcMnnd by huriiuuUl Uu«a pantli<l lu Oj. Bit. (9). vlUk Uw eorresprriiat- 

[og 7«Kr« «J« In Uw iun»J iiisiiitM' UektA iiCI In ilnwimilltid iintpr bI winnl illsUiif«i> 

■Lnif Of. Ta nUHUVre tlie rate of growlli at aiijr poiiil P. |iDt a mln to toufh 

Um mrvp at i*. Lot it >i>«4( '.'y iii I, ui4 l»l .V )w lli-r puinl uu "y at Uic *MDe 

TBTtkal Ucisbt B* /': tbcii tho uomlrar of yvon ninrknl uff bIou^ Oy hj ibv dU- 

Unw AV ia ito latunn of tlin triu-Iiuii by viliicli llii! niuuuut In iiimiaiiiuR 

taanuHg. That i> U .Vr w w r*wx ti» Biiii>aiit Is Irii-rosMiiiij nL th^ rate ut y^ 

l.«. of & f«r cmA. annnaUj: if .Vr w 'ia j*an. Uio i»miwD in ,1, or t |>r4' CL-tit. 

Mtmutllj' ; ami H) ou. ttm a ]>a|<cr I17 tlic ^nvsEiit untnr i» llie Jubilee uuiiiIh't uf 



172 



ELAWnCITY OF IlEMAXl). 



places were but elowly adapted to its use, and a 
trutSc iu it ditl not si>riiig up quickly ovcu ti> pleoes to 
which it could be easily carried by water. The invendon of 
proccMos by which it conid bo used os a substitute for 
charcoal iv manufacture went even more slowly, and is in- 
deed hardly yet complete. Again, when in recent years 
ihe price of coal became very high, a jjr&at stimulue was 
given tfl thp inventinn of ecnnnmiRR in its use e-spf-cially iu 
the production of irou aud steam. But few of these in- 
ventions bore much practical fniit till after the high price 
had passed away. Again when n new line of tramwaj-s ur of 
Kiihurban railwnyii in opened, it tiLkcK Home trime before thtHte 
who live near the line get into the habit of making the 
most of if* ibwistance; and a good denl more time elap.'es 
before many of those whose placQB of business are near ouh 
end of the line change their homex so as to live near the 
other end. Again when petroleum first became plentiful 
few people were ready to use it freely ; gradually petroleum 
and petroleum lamps liave become familiar to all clauses of 
BOcietv: too much influence would therefore be attributed 
to thft fall iu price which haj* occurred since then, if it wer^H 
credited with all the increase of cousumptiou. ^| 

Allied to this diHiculty is that arising from the fact that 
there are many purchases which can easily be put off for a 
•j^^^sliort tiim;, but not Ibr a long time. Thia is often the rase 
oUuni with regard to clothes and other things which are worn oot 
gradually, aud whitvh can bt made to Bervu a little longer 
tiuuj usual under the pressure of high prices. For iustttuce 
at Ihe bcgiuuiug of the cotton famine the recorded ooi^H 
sumption of cotton in England was very small. This was 
partly because retail dealers reduced their stock, but chiefly 
because people genemlly made shifl to do as long as Ihey 
could without buying new cotton goods. In 1864 htiwevor 
inauy found thcnuiclves unable to wait longer ; and a good deal 
more ootton was ontored for home consuraption in that year, 
though the price was then much higher, than in either of 
the preceding years. For commodities of this kind then u 
sudden Bcarcity dttya not immediately raise the pric(? fully 
up to the level which properly corresponds to the reduced 



Snmti lid. 
mnudi rau 



STATIOTICS OF RETAIL TRADE. 



Topply'. Similarly aft«r the ^eat commercial depreeMon in *««« "(.' 

the U'uit^,•d Status iu 187;J it was auticod tlial the boot trade _! ' 

revired before the general clothiDg trade ; becaaae there is 
ft gnat deal of reserx'c wear in the coats and hats that an> 
throvm aside in proeperotis times as worn cut, but not so 
much in the bo<>t& 

§ S. Since the difficulties of deducing accurate laws of soma «■ 
demand from statistical tables relating tr* general eon-iui,„,,„^ 
sumption are so great ; since so many of those which at first ^'SL'"(or 
Kight promise to be utteful turn out, at all events in the<ibtKi"t^ 
pret^nt slate of our kuewtedg<j, to be ust^lesK, it mav bt!rit«*ta- 
worth white tn try auothi^r routn. Therv; is one which at "*' 
all events avoids most of the ditliculties that have just been 
ooojRdered*. 

A shopkeeper in the working man's quarter of a mauu> 
fibcturing town ha^ utVu the tnuau!! of aKL-KFtaining with 
tolenible acctiracy tho tinanciai piisition i»f the great bixly of 
his customers. Ue can tind out huvr many factories art: at 
work, and for how many hours in the week, and he can hear 
about all the imprtatit changes iu the rate of wages: iu 
&ct he makes it hid business \o do so. And aa a rule his 
customem are r^uick in finding out chunges in the price of 
things which they cummouly use. He will Ihereforv often 
find cases in which an increased consumption of a commodity 
it brought obout by a full in its price, the cause acting 
ijuickly, and acting alone without any admixture of dis- 
turbing causes. Even where disturbing causes are present, 
he will often be able to allow for their influence. For 
inatonoc he will know that as the winter como» on, the 
prioes of butter and vegetables rise ; but the cold weather 
makm peopio deJ>ire butter mnrp and vi^getables lo!» than 
b(^3ro : and therefore wlien the prioes of but h vegetables and 
butter rise t«wnnlK the winter he will expect a greater 
^,jStUing off of confiuujpliou in the case of vegetables ttian 

lid properly he attributed to the riiie in pice taken 
me, but a less fiitling off iu the case of butter. If however 

1 OnlcM itHlMi thorv U ui esoltod sp«<>alaUiiii. iriUi pnrlinim a. "etirnm" lu 
IkCBarM for ii; and ihauUieraaTanaitvuf it* pHce obvy uu rulit. 
■ Gouqan Jermu' HMry 0/ PoKtiaai AwMomy, pp. II, IS. 



174. 



ELASnClTT OF DEMAND. 



uwK 111. in two ueighbortriiig winters his tnistomera Imve heou at 
" ■ equallv niiTneroiis, and in receipt of about the eame rate of 
wagcM ; mid il iu the oue the price of butter y/m & jjood 
deal higher thaa the oth^r, then a comparison of his books for 
the two winters will aflbrd a very accurate indication of tbft — 
influence of changes in price on eonaiimption *. ^ 



' Such B ahupkcL-iwrV Iniuk nflunla good <>{ipairtniiiti» tot thn ■ppUr-Ation at 
"tltP Melbml t'lf DIITcnMicr." It Lin) 1i« huiieil Uiat. an Eba knunladee at 
vistniiviii^ crifiira in iliSunvfl. liiciil ntHlialii'al Hucii-tiu will ilu ituiiurUut vofk in 
tliliaiiiliiliiillnrtllrwHorin. A1>ovi>aII [liiuTimj))^ hopMl rmm thegruteo^jicmtlvB 
■Umw. ^opIcDDjicrs will) *a)'plv oMim daiiia cif (ociutf muit uMAMonall; Iw iu 
a positiiiu li> fiiniiitli niiiiiliir fuotn rvlMlinij li> tJjc rutitiutuptiou of their dutotucn. 
Aiid if a »uiSclcnI uiunWr nf tahlm uf duii^iiil l<r dlfTfrciit ■i.'ctioiii) at nueiety 
ronlil be abUutieil. thifjr woulil sllniil tliL* ini^nn* nf •tlaininit x rmnll whirh t« 
iiimn'£iiulhl« l>j any iitbnr ri>nti<. For ft< u ];t>[Lvriil mlv tlii^ {<rk'« ul i caDUuoiUt; 
l!iifliuili'» "itiiiii liut unrrww liniilE: auii Uit-ffltiro ttnliiliri nffottl iw undlmt 
nicAiiH >i( mi^iMiit; vlmt tli# oOTi>nuri|itroti of It n<-uUI I<t> if ito {Mf* wi^rv (•lUier 
flyuruli] vr a fiftli |i(U-t of wlmt [I wtunll; U. Dnt vi know Hint )U -MininimiilliHtHl 
wnulil bt' coiifluivl nluiuat i-^iUivly Ui llis rich if itB price nori- vetj Ligh ; anil thati^^ 
if itN jiri-ce *'vtv wry Idw. Ilie RTiwt hoily at ft) cniitiimiitbn nonli iu iiju»[ oaim 
bn aitiuui; Lhe wurUiis i-laineii. If Uib praiKiit jjrict- in vprj hiffli rvlnlivelT to 
llio iiiiilill(i or to the n'nrl(iii)[ chw. wo nuy ba ablr tn iiifor fnini tlw Um of 
Ihdir ili>mNriit it tlie tiTi'tidit prir«« «bat wonlil ho tlip il«ai*nil ol Ilio lii^li if the 
Iirici.' Knrv Ml ntiiHTil «■> lu to Iw ^i-ry bi)[li rvlntlvvlj o-aii t» tlieir invBiui. On tbe 
(lUivr luud il tliE giioaout iiHtc ia iiio{)iriit? r«lRtWcl.T to tho lucuii of the rich, we 
iitiij bf nble U> luXO' ffum tliclr ilcruiiiiil HbnL wonlil liv ibc ilciuiiiiil of iLl- nurkiuK 
i'Irkhoh if ttw pric" wtirc- to tn!l to n Irvnl wliii'li iHtixxkralu rslBliVdl; tii tbdr 
iiicuii. It \* only Vy tbiix |i!(<C'tiii! Eoei^tbi^r frnimii^utfin' Iawx of ilemuiil llu,t irt> 
«aii linp« la )[><'' <^"T aplTuitFli to axt accnmin Uv ruUliiig t« triilnl; dUTimint^ 
Iirlc*'', iTIut in Iu ««;c tbc tti-ricrnl iliiiuaii<l runri lor a tviinuioditj c&unol ba^| 
■Imwii witli conflilouvc pxcupt in tlic imtniHliutf iinliiLbmurlioutl uf thr curroit^' 
piirc. until vt UK Mb ta piecv it tii^ttla-r out of tlic trngntrntaTj ilnnwiil mr?e« 
(■[(lillrroiit d&WMof wrlcty. Cnniixuv tin- Hwrmil iM-liou vf lti!> QliiLpttir.) 

Wlieti Kuiiui |ini|tn-Nii hBH Iwl-ii iiiitdu ui n.'iluc^)ii(( li> dcfiiiitr law tlir ilniiani) (or 
rcrnitniMllUctfi ttint am dnatinml (or tinmwltkt^ coimamptlfin, tliesi. bnt nut till Iheii. 
will [Iwro be luv in attcnilitilig a similar ta«k with n-gird to Ihuic nceoaiary 
(lunuuiiln tvLicb nrv ilritviuWiit «ii t\i«m> — ILv dmiiaiiile uiuuulj tor thr labour 
(tf Bftiniuin aiiil iitlivn wUd taki.- part In tile |iroiIncti(in ol thing* f»T mJci ami 
aftalii tliLi ileiiituiil for iiincltiiiim. fiii'torltiH, railway mati^rial aiiiI dtbor iiutru- 
iiLHiilH of imHlartioii. Till! deniuiit for the work nf mwlli'id iiic<ii, rd itoiiiiMtllr 
Hwant* ami uf nil thosr wLtni' i«FviviLv ore rctiitciivd (linwL tu tlie oiuminer i* 
Hunflaj ill cbami'tiir t^ Cliki rlf?iim[ir] ftiT rouiuiiHlitii<H fur iutniriLiat^- c^iitKiuiiption, 
and it) lavi tiin^' be lot cation t«l iu tbv hbiuo nianiwi. 




§ 1. We may now turn to co&sidcr how (ar the price boox m. 
which is actually paid for a thing rcprcsentfl the pleasuro ^' '" ' 
that arises from its poBacssion, or in other words the ^™ ■">* 
"utility" of wealth. This is a wide subject on which 
economic eciuitci^ haa vory little to say, but that little is 
importaat. 

We have already Heeu that the price which a person pays 
>r s tiling, ca]i iiovcr oxcc-cd, and seldom comes up to that 
ifhich he wonld be willinfr ta pay rather thiin go without it: 
that the gratification which he gets fruiii itu pureha^ie 
Boerally exceeds that which he gives up in paying away its 
i; and he thus derives from the purchase a Ktirplus of 
pleasuro. Tho ercess of the priee whieli he wf>u!d W willing 
to pay rather than go «nthont it, over that which he actually 
lio«a pay iti Uie wxjuomic measure of thi-i surplus pleasure: 
for reasoQH which will appear later on, may be called 
SNsuMEtts' Rem'. 
in onler tt> give definitencMi t«i our notions, let us con- 
ider the case of coals purchased for doniestto coDsumptiou. 
3t us take the case of a mat), who. if the price of coals were 
&I0 a tun. would Just be Indiiecd to buy oue ton auuually ; 
rho would just be inducfd to buy two tons if the price were 
r, three ton« if the price wi-ru £5. four tous if the price 
: £:), five tons if the pricis were £2, six tons if tho price 



Stnl. 



> Tlw lidlnwhix Booaiuil of Cuiiaiuncn' Beut U repixklnced «riUi ediiEbt kIUvm- 
vB aooM iNVtn pflSMl lor iiiirtts cLreoUtiou lu 1HT9. Sm Pr«Iiw«, 



17(i 



MEASfnKUEST OF UTlUTf. 



UlL IV. 



Tbfl tonn 

UtOitg 
•vu iittro- 
■Inrt-d bj 
Javwia. 



were £1. 1(1*., atiil who, thf. pri»!t^ being actually £1, dc 
purchase aeveu Uius. Wu tiave to luvestigare ihe Consumers' 
Keot which hr durivt-ii Iruin his power uf purtfauamg coal at 
£1 a ton, 

The fuel thai he would juat bu induced to purehusc oac 
txin if the price were £10. proves that the total ei^jojnieat 
or satisfuctiiiu wlucli lii* dL-iivcs fnnn tliut tun ia an (jrvjit as 
that which he could obtain, by spending £IM on otlier things. 
In other words, the iUkti^factiuu derived from, or tbo value 
ia use to him of, a single ton a yt-ar, ia economically mea- 
sured by £10; aud therefore his power of purchusuig one ton 
of coaU for £1 gives him a surplus satis^factiun, of which the 
economic measure is £9 ; that is to aay, it gives him a Con- 
Burners' Rent of £0. 

Again if the price wore £7 a ton, he would just be in- 
duced to purchase a eccorid ton ; so that the value in use 
to him of a neeond ton bt ineasured by £7. The Consumers' 
Rout that he derives from hia power of purchasing tliia ton 
for £1 is therefuru £& : and so on. Thus the whole Con- 
sumers' Ri^nt which he derives from the powi^r of purehasing 
coal at £1 ft ton is £9 + 6 + * + 2 + I i i , i. o. £22^. 

We may put the same thing in another way. The eco- 
nomic measure of the total value in use, or, as Jevona 
sa^-B, of the TOTAL uriUTV of the coal, i« the sum of the 
pricoK that he would W just wllliug to give for each suc- 
cessive ton: i.e. £10 + 7 + 5+3 + 2 + 14 + 1, i.e. £29. 10«. 
His Consumers' Rl-iu ia the excusa of this num over the £7 
which are the value in exchange or market price of the cijttl: 
it thus measure!! the surplus or exc<;HS of the total utilitjr 
to him of the seven tons of coal which he purchased, over 
the utility of the commodities which he could have obtained 
by expending in other ways the £7 which are the value iu 
exchange of those seven IouBl 

(Those other commodities would bo just beyond the 
margin of hia previous purcboKoa, commodities which he bad 
just not thought it worth while lo buy at their current 
prices; and therefore tbcy would not yield him aiuL 
CoDsumers' Rent.) ^M 

In the same way if we neglect for the present the fact 



COJISUUBRS' RENT. 



m* 



the same sum of monoy roprcsouls different amounts oooKin. 

cii rv 
pleasure todifferenl people we may measure thu surplus __' 

itisfoclion which the sole of house-coo! affords, say, in the 

odou niarkev bv the u^grvf^tt^ of the sxmuh by wbU-h the 

^iirioes fthown in a completo dcnianiL HchtHliile for coal exceeds 

its seUing price'. 



1 liOt iiB cutukiilrr lUeii Uic (lituniKl rnrtr lifi' hiT cual iu Luixluu. LcL O/I tw 



E^. 10. 



!^ 



it wliii^li l»iHilil tilers nl til i> \iTiei! if. i%iiml- 

Tft JMT \inag iKkeu w tli* nuit at tiuiu (ur \he 

BuriiM. Tkkliig any )>autt J/ fn 0/1 le> n* dnv 

Jf/* VDrtifkUj opwonln ta locct tlie corra iu /■ and 

cnl ft liuriiwuUl line lbroui;li J m R, Wo wUl 

wppoac Um K-vcnil liitm nainbiTrRl In thn onin' 

of tbi NfenWM uf tlw ■Piei'al jiurrbiuen: thv 

■M tt UiD iinrrJiajior of oiiy Ion lioiiif; tnoa- 

lij the price b* i» iuit B-illUig to («j for 

il Ion. Tlit> <l|Cnrv ■uforius ub tlikt IJ^f unit* 

II be •oU at Ike prirc /'J/; Imt tlaat M aiij 

r ]>rfc« iiul i|Bilr bu iiuiiiy luun cnii tw suld. 

Tlun miul b* tiimt Kane iiidiniliiiiL nOio nill tmy morp Kt tliO' prlc? /'Jf, Ulfea lit 

wtt kl aur hlitlief ]irLc«: tuil we arv tu rpyiLnl tliu Oilth ton *s wdd to Ihto 

lii^ndiw]- Sii|>ii«M' for ii.itAiiri' tUl /'.Vn>]ir«>>,<iitx i'g. aiirl Hi»t OJ/tu p r wC nU 

■ ndBun loiu. Tlw pan^iuHT il«tcrihe<1 in Die text i> jiinl wiltltig Iu bvj hla flftll 

tuMuIcoklal UM)]!iic«X'i,M»l Uic c/i/Ui or millitJiich tutinfnin] m^ be Mid ta 

b« mU Ui bim- If .< H •ml IlicmlDrn ^'J/ mprcnoDt £1, Ui« Ciuuiuuen' Itakt 

dotrai (icnii UiB OMiii urn \a ihe *%eem ul l'^^ m £-1 nliiuliUiu purdiMorarcluil 

hiB mittlil hav«i l>««it ■rUlltig In jwy for it iivur /fif tlii^ j;i nhieh he uniully iota 

])•; far it. Lrt on m(ip(au lliol a vtrj Uiiii vertical p*riiUifl<>t)mui i* dn.H-D af 

■Indk tbv height U /"U mid v( wbicli lliv bn(w io llw 4ict«im.- Blotig Ojt }iM 

BMMntw tli« uuKJr niilt uff ton of rnnl, II oill b« citnToiiii'iil Iifiii04<ti>nfardl0 

npu4 pnrc » lumiaivd not by a iimtbeiiiBtu'iil i>traij;bt lini^ trtthimt UiioknMi. 

■• fJV : but bj ■ rtrj Uiiu |isra.ll(>li:iBnini. i>r nii it nay tm cAllprl • thl«k KUftiglit 

bid, of whieb the brcodtli u tu boct}- caiM v^unl la tliu <U>Uuiai alntig Ox wblch 

I nwftnnB • ami ot tan uf oo*l. Ttioa «» Mboulil My that tb» t«t«l nLisrairtioii 

^^4rHnfl froni ibv fJi/lli ton of cool U caea«ar<<d b; the tUdi (trunlit Hue Jf^*; 

^^Hhat Uio pncr paiil fnt Uiia luu ti n.-p'''<>*-'"t«'>l by tlic tlilch Hlraifilit II lie .Vll 

^^Knd Ibe Cuiiauiui>ra' Kriil dtvu'eil frviuj tbid lull hj tlir tliii-k >ti'«i;;bt Uuu /TJ'. 

^^Bl""' l*t iu> t.ii]i[iow- Uini tiich llitti imntUtluuTiuiii, or Llilck ntmight UnoH. hrc 

^^^b*wn for all potritiiiiu of M bvtwi'^n '> niiii //. one for uarb i«u or nnlt of 

oai. 'fix (kick HUalgbt Uum tbtm drxvii. u MP u, boni (J.! ap ta llw dwntftiul 

carv« iriU nacb tnckiarv this tot*! BatUfacliuu tlmtn) fniiu « tou uf cu«l Tile 

Mun of Iboe aalUfacliuaii Ukvu ioe^tlicr Id tliv tutal BaLisf&cIluii ilcrivixl from 

tka eaacunptkin of ami : aii-l thnn think aLnLisht liniw Xakmi tonrtlipT mxnp; 

■adoBeUf U ■!> Ihu wbulu uva DOHA. TUervfunt *'a uiajr any Dial Iliv area 

'BJ OMHBKfl tbn tutivl ■atitfu'tioiii Joriviirl froui tlio (Kuiauiipliiiii of cfla). 

Meli «l tbc ■Iraighl liun ilrairu. mx VU i>, traia Or upwanU an far 

<]C nipiiwiiln ihp jirlnr iliaC sctiMUr b puld t«T • Uni of ciaI. Thrac 

Hbm topither lukki: n|i IIil' arm COll.t: uul tbirrrturi-' tliia ar«tt 

n|n»Mila tko total priM |>«L<1 fur coal. Finally eaob of tli* sLnilicbt Uims 

M. 12 



1T8 



trEASlTRBHEXT OF irTII-ITy. 



BOOK m. 

CB. tV. 



CnrriRo- 
t!oiia lu be 
tnftiU ; tirnl- 
Iji an no- 
camtl of 
iliffureiicRH 
lathB 
wealth a( 
ilifferent 
puicluui- 
on. 



It is obvious that the CoosuincrEi' Reuta derived frot 
Bome conmiOfUlies aro much greater ihau from othyrs. There 
are many comforts aiid ]uxune» of which the prices are 
very much below those which many people would pay 
rather than gu tnlirely without tliuiu; aiid which there^ 
fore afford aii enormims CoiiHunierK' Rent Oood instances 
are matches, salt, a peuiiy uewspaper, or a penny postage 
stamp'. 

§ 2. Next to take account of llie fact that the rich value 
at ft shilling a much smaller gratification than the poor could 
afford to pay a shilling for. A poor woman who could manage 
to bny only one jiound of tea in a year if ahe had to pay 
10*. for it, will derivt: a \'ast aurpliis wttisfection from biij'irg 
several pounds at 28. a pound. But a much smaller riur])lu» 
satiafactiou ie oflbrded by u change in the contiinnption of a 
rich man that has an equal money measure. Suppose for 
instance that he would buy only one bundle of aHparaguii 
at the price of lOs.: but that, the price falls to 






dnwn OS RP u bom AC apwwr^* •« Eu* M Uie domaud «iirii«, T^jveMnta the 
CoiwaiiiWe' lUiit ilurivoil tnioj Iba ourrudiiuudinu luu ol co»l. Tliuw irtnti)(tll 
Hum tOEiiClior malic up Ihu area ffCi ; niul tlivrafurs Uiix wtru rf|ircwal« tlie 
ItiUi Coiunmora' Koul Ui&t Ih iUtIvoiI trtiia cimJ wlib-ii tbe piioc la AH. 

It liiu ftlrftidy tnon. [eiiiarbu3 that it will >oliluiii Iw iHimitilfl to aliUiu tin- 
iIrU iie«0Hsai7 for drawing Uie ilt'iuainl cinrvo nccnrBtel; (lironfibaDt uij largp 
jKirUoai at iU Ivngtb. II J u the paint on tlii cnnd fDirvsiHuidini) (a tlia Hnonnt 
tliat i* wuDl til Iw B'M ill till' iimrtciit, ilitt& wui W oblaintril iiuffidiail tor diair* 
iiig tbconrvo Tritb tolerable concctni'ns for iioiiii: dlntaiiov uii viUior itdo td At 
lint it n-ill »farc«ly ever ocpur tljal tliii cnrvu <-bii be (irnwii witli »fiy approaeb 
to Kocunu? rijclit nj\ la li. It Iiapphtik, lutnvver. tbat Ibi- iinurtii'A] ajijiliaUcau 
of Uiu Uiuory uf vnluu nviutru a ktiuuluiljii of tliu thafio al Uin doRtand rami 
wsky in lite iivigiilwurluMKl of A. Wn N^dom rcqnln to M««rtain a««nrald}' 
the tvdil urpa /'('.I; il in HiitISrii>iit f'lr oioat of otu pnipoMa to tinon tlie 
cbiuigc* in till* area iLnt would W oDCMtaiidd hj inovtag A tbrougli muall 
dinUuJiM-n aioiig tlic carte iii citlicr lUraction. Keverthclcu it trill Ix- cdiivriilpot 
to drntiitue In ounnid, w In pnrc tliivry np arc at (Ibertj M ilu. t)ul lb« 
purve la comjiJotclr dmwii for tib. 

■ Tburu ui bunuvur a diQaalty in aslitiialiiig tho total ntilitf d coaunMUtiM 
Hime Mipplf of v'hkli 1b iic-MVitarj far life; \ia idiituico, tbc atiiil^d thvfood 
raqoimd to kM']i n luau troiii iitarvaliuii U iiiilrfliiltvJy icrcat, Tlie bMt plan la 
IHrtrnp* to lake Ibat u«cvMary nipiily fiw Kiraulvd. aud attimnlc \3ax. I^ol ntlljtf 
oil]; of tiiat [nrt of tlic cnminoilltj n'ttich ia in oicsM uX this aniuruil. Dat 
luro it !■ evpcvlallj' Uu]Hiitiuil Cu TL-uullMrC that Ihfi dudm fnr aiijthliiK in niaoli 
■loiwnilent on tb» dilDeuliy uf g*'"''''K Hubbtitnti^Ji (or IL (S«« iicto VI. in 
Appendix.) 



QUAUmXa CONDITIONS. 



17BI 



be {Hirchaaes Beveml bundlea He gets from the low ]irire w»kio. 

of asparagus a surplus satisfactioti indeed, but a much J ' 

smaller one ; and yot these two satmfactions have the same 
MOQomic moasiut's, the Coiisumere' Reuts in the Iwo coaoft 
are e[|uaL 

This fAct diminished the practical ii^ofuln«ss of catimfttM 
of CoDsuiuere' Rent to some oxteot. but uob nearly so much 
«s at tirnt ftight iippcnrK. For, an has already bc«n poiii1o<l 
out, we roav suppose iitilitifH which iiave the same mrniey 
povrer to be fairly eijual, provided the priceH, which wo are 
consideriug, aiv those paid iii two niiirkct£ whore the average 
wealth of the purchatient is equal, (ns well of courei? as the 
geueral purchasing power of money). We must however 
alwBjK be careful not to rt'gaixl the total utilities of things 
as fiurly repiv»eiiied by their money meaKuree when one of 
the thiogti is consumed chietly by the rich and the other 
chiefly by the poor. The neglect of this precaulioii le<l 
««xinomist« of the lafit generation t^i ntitnie concltiHtODS, 
which were unfortunately of such a kind as to seem to imply 
a waob of sympathy with the sufferings of the jiour, But of 
thta more hereafter. 

There ia another ctasH of con-uctiona which miiHt be made SevuDity 

befure the money measure of the total utility of wealth can rfo'SS^u 

be taken to repnaHrnt the real hiippiiiL-st which it« posseesion i?/^lili[i, 

affords. Not only does a peraoo's happiness often depend more *'»<''' ."* 
1-1 1 1 1 1 ■ 1 I , "pt ti> l« 

OD his own physical, mental auu moral health than on the orcrlooh- 

^esltinuil eonditioti^ of hia wellbeing: but i-vlii uniong these 
dndilions many that arc of chief imptntance for his real 
|']lappiut^s3 are apt to be omitted fivm an inventory oT hia 
IWealth. Sonoe are free gifts uf uuturu ; and theue might 
adeed bo neglected without great harm if they were always 
le umie for evcrj'body; but in fact they vary much (rota 
["■place to place. More of them however are elements of col- 
lective wealth which are often oinittcd from the reckoning 
if individual wealth; but which become imlrartont when we 
imparts diffentnt. pnrt8 of the modem ci^'ilized world, and 
aveo imtTv important when we compare onr own age with 
earlier times. Subject to those corrcetious then we may 
fvganl the aggregate of the money meaBures of the total 

12—2 



180 



MEASURESIKXT OF UTILITY. 



notvKnt. 

OB. IT. 

I'urUier 



Ber- 
tinnilli'a 

tlou. 



bbliinteil 
by fminili- 

■ritj-. 



utility of wealth as a fair nn>asTire of that part of the 
ness which is dcpondciit on woalth'. 

g 3. All iucreafte of wealth Hcarcely ever fails to cause 
ftB inerea.'*e f>f happine-sfi for the tinn', Indopendoiitly of the 
pleasures j^ot from Lhf l!iiug« that oarx be Ijuught with iho 
new wealth, there is a eatisiactiun in the success of which it 
is generally a sign*. In accordance with a suggestiuii mado 
by Daniel BemoiiilU we may perhajis siijifKwe that that part 
of a person's happiot-ss which he derives fr&m his iucom(>. 
may he regardetl as commpncing when h« ha-s enough to 
support life and afterivards as increasing by ei|Ual aiuoiiiitti 
with every tmual successive percentage that is ujii<le(] t« his 
income ; and vice verm for loss of income. |H 

But after a time the new riches often lose o great pa^^ 
of their charms. I'art.ly this is the result of familiarity; 
which makes people ceoec to derive much pleasure irom 
accustomed comfort* and hixtiries, though they suffer greater 
pain from their loss. Partly it is due Ui the fat^t that with 
increased riches there oftrcn comes either the weariness of 
age. or at least an incretise of nervous strain, and perhaps 
liabits of living that lower physical vitality and diminish < hf^ 
capacity for pleasure. fl| 

In every civilized country there have been some followers 



1 Sw DOW VH, In tli« Appondis. 

* E«e aute Vltl. In tbo Appfaiilli- It ma; twrnaattnud to pudm (fait fen 
thd gmorol Inw timt the DlUitr tu miy oiip ut n, adtittOMl <l dJmtaUlm wUk 

tiic liuiEiItT uf ]>"iini1ii liH nlri'tul^ Iihh. llinri' tnlinn' Ivrn iiii|><irtftnt [<Mi!tiMl 
IirLucJt'lK"' Tliv fliDt i» itiat snnililiii^- invnivm an wotiomic low. v*em whan 
(vmilni'lnl mi in'Tttctl)' fair mid Kvi'ti Uirnui. For iriHtimcc * luui nba baTing 
C6UCI uiake« B fair rrnn Iwt nf t'llll. biu linw nti rljicc-Utian nt hnl'liilipn 0%VtX 
tu hiii Hint ilnnvil rrtim t'T(Hi. m»I linl) Hint •1i-rii(<it friiin t'r>lll>: and lite la 
lau lliBiii llio i-Lirtuti Ftiiuvluliuii uf Uiu hutijiiiii'in iluHrsd (raiu £G(IO. bMrnHa 
bf lijpDtlKHU Uie difl«rMic« bAtwccin Ihn ltA|>pUip^ ijot ln>m £ii<«) and VOn 
ia jnskr tlixi tlin lUffvrvucu Imtwixii Lbi! liii[j|'iiic» got from CT<lO and MOO. 
(Canpara JavoiM to. Cli. iv. aai nut ticrte IX. in tliv A.p|-vuiUD Tlic M Mai 
pitaididci llio ilirvcl cauvme of tlii lint. Is dial li ttiirorcilcaJl? fair iamtnmoe 
■SKiaat rlHliK i> ntwnyi nn ecaiiunile |[ain. Bnl of raune evarr fuMUWiea oOm 
■ft«r calrnlHlinii irliat u a lliMirMlnaUy fair pMminni. ht« ta tiargt In aAHOcat 
to 11 enooglL in iidj-foT F"*flta on tU owii eaplUI. and fur Ha ami espaiaM«f 
wMrking, axnong wbidi ara Alton to be rMkoned tvrj' htavy Itemi tor tA'nttUBf 
■All tor lovtica b,y tnwd. Tbo qtmtion wbotLcr it i> adviaal'Ie to ixtj tbo prt- 
itiiuiu wliicl iiiBuraucD ottco* practteaUj do thuge, to one tlwi mut bt UwU ad 
lor aacb cumh on iu own mont*. 



WISDOM rS TUB rURSUlT AMD USB OF WEALTH. 



of the Buddhist doctrine that a placid serenity is the highest 
ideal of life ; thai it 'u* the ]>art of the wise man to mot out 
of his nature as many wants aud desires as he can ; that 
real ricbc-s coutiiBt not in the abundanco of good^ but in 
the paucity of wants. At the other extreme are those 
who maiutoiu that the growth of new wanbi and denirus is 
alwaya beneficial because it stimulates the people to in- 
exoitioiiA They seem to have made the luLitake 
Mr Herbert Spencer Bays', of BUppoaing that life is for 
orkiug, instead of working for life. 
The tnith Kecms to be that as human nature Is cnn- 
■iituted. mau rapidly degeuerfttes uoleas tie hae some hard 
work to do, some difficulties to overcome; and that some 
Mrenuoiu oxcrtion is necesMuy for physic^ and moral health. 
Tho faloess of life lies in the development aud activity of 
as many aud aa high faculties as possible ; though to carry 
octinty, however high, lo the verge of exhaiistioti is a mistake 
unless it be done iu pursuit of some higher aim. But, particu- 
larly in a Northern climate, a great deal of hard work is 
TirrfWllTj to enable us to e.4cape fixim hunger, cold and 
diaease, and a great deal more to provide the meanx of a 
fairly cnltured life. There is fume misu»e of wealth in all 
ranks of aodety: but, speaking generally, we may «ay that 
every iucraaBe id the income of the working i;la»ies adds 
to the fulness and nobility of human life ; because it i§ used 
chiefly ID the supply of real wants. 
^K § i. Even among the artisans, however, in Englaud, aud 
^H perhaps still wore iu new countries, there are signs of the 
^Bgrovth of that unwholeiuim'e desire for wealth as a means 
^Hof display which has beeu the chief bane of the well-to-do 
^H classes in every civilized conulry. Laws against Itixui^' have 
^H beeu futil«*; but it would be a gain If tlie moral sentiment 
^Kof the comnmuity could induce people to avoid all sorts of 

■ 9** lib loclora <m tJti tiowixl of HcUjatioi.. I Unr^ hmiTiI ». tiiaini f fletoKT, 
*\Km gntara] okanotei «tiKHl luith. cxiJruKB ruiintt si Uic [ondcncj- ot lil* irorlE- 
nun la au« low fur ilriuk : becftOM vIimi Umj Aiuiili man, Oimj "urc more 
M^v W wn Utfh wi|t«a. tni, linving !« nwutinwi. wars more ful1>- miilcr 
bf* MnWeL 

■ RowlMr hMM whtMn mneh Uikt I* inUrMUng «u Uila anbjaet io tUs Political 
KtfMmg and in Ua AiuiciUn- 



Boat m. 

CH. IV. 

Tho TftlllH 

at leltufo 
aiid re*t. 



Tlie«iiMir 

ItDCP of k 

nuxlanle 
incom* <A- 

iiKKlerale 

work 



tnro (or the 
tiUie ol 



182 



MEASUREMENT OF UTIUTY. 



^I'talUj. 



uooK III. display of individuo! wealth. There ore indeed tme 

__■ worthy pleasures to bo got from wisely orderod magDiliecnce : 
'^" . but they nxe at their bent when free fpom any taiiit of per- 
iifiiiiiiiy ol soiifti vauitv Oil th(3 ouc Side, and onvy on the other; as they 
wti'T »v«T arc when they centix! niunu public buildings, public (jarks, 
nsc n"'^'"*' puWiG eollectious of the fine arts, and public games and 
amusemeiils. So long as wealth is applied t^i provide for 
over}' family the ueeessariiw of life and culture, and an 
abundance of the higher fonni* of enjoyineiil for collective 
use, so long the pursuit of wealth is a noble aim; and the 
pleasures which it britipi are likely to iucrea^e with the 
growth of those higher activities which it in used to 
promote. 

When the neoessariefl of life are once provided, eve 

one should seek to increase the buauiy of things iu his 

possessinn rather than their miniher nr their magmticence. 

An iii]pi-uvemeut iu the artistic chameter of fiiniiture and 

cirjthing trains the higher faculties of these who make theto, 

lutd is a Bource of growing happiness to those who uee them. 

Wittai Bnt if instead of seeking for a higher standani of beauty, we 

t£«fr^n Bpend our growing resources on increasing ilie complexity 

^^M "'"^ iutricacy of tmr domestic goods, we gain thereby no truv 



f 



tllF JITD- 



wliieliBuut benefit, no lasting hapniness. 
bedsfomal. '^ ' ' 



The world wonlcl go much 
better if every one would buy fewer and simpler thiugs, and 
would take trouble in fielecting them for their real beauty; 
being careful of course to get good value in return for his 
outlay, but preferring to buy a few things made well bj 
highly paid labour rather than many made badly by low 
]>aid labour. But we are exceeding the proper scope of the 
pre^sent Book ; the discussion of the influence ou general 
wellbeing which is exerted by the mode in which each 
individual spends his income le one of the more important 
of those applications of economic science to the art of 
living which will lind their place at the end of t iM— 
Treatise. ^ 

Finally then while insisting that everj* one's chief sources 
of happiueHs must be within himself; thai health of body 
and uiiud and spirit, a purt^ heart and n lore towards Gtid 
and man will make a person bajipy however poor ho is; 



FUTURE INQUIBIES FORESHADOWED. 18S 

and that no amount of material wealth will serve to chase boo^ '"■ 

away misery from one who is not of a cheerful spirit; we _! ' 

must recollect that poverty causes mental and moral degra- 
dation; and this fact will indeed be brought prominently 
before us io our ensuing inquiry into the causes which 
determine the efficiency of labour. A moderate income 
earned by moderate work offers the best opportunity for the 
growth of those habits of body, mind, and spirit in which 
alone there is true happiness. 



BOOK IV. 

PRODUCTION OR SUPPLY. 



CHAPTER I. 



IKTBODUCTOBT. 



§ 1. While detnam) in baaed on the desire to obtaiu 
commodities, supply depends on the overcoming of the uu- 
willingnesH to undergo "discommoditiua" Those fall gwne- 
mil)' uuder one of two clzi.g8es, labour niid tbu ubstxiiciice 
ioTolred to putting off consuniptioii. 

It is true that much exertion is undergone for its own 
sake, as for instance in inouutaioceriiig, iti playing gaiuea 
and in the pumuit of literature, of art, atid of scieuce; and 
macfa hard work is done under the intlucnce of a dcsiro to 
benefit otheiB; and such work has for the greater part no 
«oonomic meamro*. But the chief motive to most worlc, tn 
the present state of the world, is rhe denire to obtain some 
material adriuitage, which ofieu appears in the first instance 
in the funri of the gmn of a eyrtaiu aiiiuuut (if inuney, iir 
command over oommndities in general. Even when a mau 
is working for hire, he often tiudH pleasure in hiH work ; but 
begenendlygets so lar tired before it w done, that hn Ls gkd 
wbon the hour for stopping arrive* Perhaps after he has 
(rut of work for some timf?. he might so far as his 

lediate cximfort ht coucenied, rather work for tiotlung 
ihan not work at all; but he will pmbably j>ref<--r to store 
np his strength till he ran get paid for his work, In most 
occaputionif even that part of the work which atlurdx the 
worker nwre pleasure than pain, miist as a rule be paid for 
> Comp. Bic. L Ch. vl. 



llctllS IV. 
ClUf. I. 



TlwiiMh 

woriisn 
vuion*: 



kulUi* 

inowt pm- 
mindit for] 
oar im- 

thoCF COQ' 

IIocIhI witb 
tlir bope 
of rcwftnl. 



isa 



INTBODUCTORT IlKMAUKS 



DOOS tV. 
Cll. t. 



itaryinitl 
ilitBtiiity, 



AJtliuujili 
lulMnr in 
(KiinptimvH 
ila o«-[i 

rt'wnnl, 



At the 8ftmc rate as tie rest; the price of the vrholc there- 
fore is determined by that pajt of the labour which is most 
itiiwillingly given, and which the worker is on the verge of 
roftisiii^' to givt' ; or as we may soy by the Mahginal dis^ 
UTILITY of labtiur. " 

As with every iucroase iu the amount of a commodity 
»ffi-red for sale its margitial utility falls, and as w.'ith every 
tall in the marginal utility there Is a. fall in the price that 
caa be got for the whole of the commodity, and not for 
the last |>an. only; m it in with regard to the wipply nf 
labour. If there is au iiicreaae in the amount required of 
a certain kind of work, and some «f it ha» to be done with 
greater difficulty, so as to cause a greater disiitiiity, then a 
higher price muHt be paid for this ; and the price of all the 
nwt of the work wi]| rise at the same time. This surplus 
price which has to be paid to all the rest of the labour iu 
some rwpecta resembles Rent, as will be more clearly seen 
hereafter. 

The unu-il!iugTie«s of any oue already in an occapatioa to 
increase hia exertions depends, tiudt-r ordinary circunostAnce*. 
on fundamental principles of human nature which economists 
have to accept as ultiannte facta. As Jcvons rcmarkji'. there 
ie often some resiHtauce to be ovtrconie before setting to 
work ; work often involves at starting some little pain, which 
gnulnally diminishes to zero, and is succeeded by pleasure ; 
this increaaes for a while until it attAtnR n certain low maxi- 
mum, after which jr. diminii^hee to zero, and is succeeded by 
steadily iucreasiug |«iin. In intelkclua! work, however, the 
pleasure and excitement, aftar they have once sot in. often 
go ou uicreasiug till progress ia stopped of ueeejsity or by 
prudence. Everyone in health ha.-* a certain jilore of energy 
on which he can draw, but which can only be replaced by 
rest; set that if his «x]>enditnre exceeil his bieome ftir long, 
hi* health becomen bankrupt; and t-mpioyers often find that 
in cases of great need a temponiry iiicrenae of pay will induce 
their workmen to do an amount of work which they cannot 
long keep up, whatever ihey are paid for it. 

Subject to these and some other tiuaHfications it is broadly 
■ n«arj( of Fclitf<»l Kconamf. Oh. r. 



OS PRODL'CTIOX OB SITPLT, 



181 



» 
» 



•"tnie tnat the exerlinns which any «i^t of* wurkiTs will make, book n. 
or fiUl witl) a riat- ur fall of tht i-eiiiuuuraUou which is ^' '" 
to them. And if for thv moment wp ftssuimed that *" ""^y. 
the efficiency of })i\>iluctio» il^pciided »ijlely ii}f(ju the cxlt- supply >a 
Uonaof the workerii, we should gi;t a KurrLVScaEDTTLE cor- Ii7i.ii«nri(« 
responding to Ihe Dt-mjiiid St-heduk- which wl- have aln-ady J^'^t'iot" 
cotuddeied. This Supply Schedule would set forth theoreti- id- 
eally in one column of figure*, various amounts of exertiou schtd^SI' ' ' 
and therefore of production, and iu a |»rtralkt coliimii the J^J|.i5rt*'^i 
prioes which must be paid to iiiduce these amounts of exer- f ""nn"'' , 
tiou to bo forllicommg. As the pnee lYniuiKvil tn attract 
purchasers for any given aniinint of a commiidily vt&n ealled 
the Demand-pric<- for that amount, so the price required to 
eall forth th^ (?xertii:in lu'etssim' for producing any fpven 
amount of a eommoditv niav be ralh-d the SUPPLY PRICS for Bup^o 
that amount. 

Thw insLince will s«T\'e fairly w«?ll to indicate the general 
drift of the inmiiry before us ; but it does not closely coi^ 
respond to the actual conditions of lifk 

§2. As ft mfllter of fact the supply of commotiities isTLoonW 
not »> !iim]ily del4?nniniHl : the total efficiency of produolion J" "^^j^ 
depends nn many conditions, which we have to consider in f* "^in* 
the prtstent Book. The first of ibcHi; U tjie aid which nature M«nUUona 
gives to man : which we shall find to be such that though tayvly 
she scarcely ever oeaw-s t<t rrwpiind to liis increased cffurU. 4^!lli„d«^ 
she often affords them only a diuiinitihing rate of return. 
Next we liavf to discuHK the growth of niinibeni and the 
average strength and indu»triat skill of t^achclaHi of -workers: 
and to conader them in relation to the causes which deter- 
mine the Bupply prictw of different kinds ami amoiiiita of 
iadustrial efficiency. !Next after looking at the growth of 
w«altti in general, aud iu particular tho&e part« of it which 
aid and support fiiture production, wu mu»t examine the 
canmx and the ef)'cct« of induHtrial orf^anizatioi) : for the 
collective efficiency of production dejiends on it-s orgnnixation 
almoatas much as it does on the numbers of those who work, 
ot on their individual effieiency. 

Having thus taken a brtwid survey of the factors of pro- 
duction, we shall be prv^pared to coiwider how the supply 



190 PBODUCnON OB SUPPLY. 

"ooE IT. price of any given amount of a commodity (that ia the price 
' at which that amount will be forthcoming under nonnal 
conditions), is governed by the supply prices of the several 
factors that contributed to its production. We shall then be 
ready for discussing in the following Books the general 
theory of the relations of Demand and Supply, and the ap- 
plications of this theory to the chief practical problems of 
Distribution and Exchange. 




fe 



§ 1. Thk requiaitm (»f ])Toductiou aru cummonly spokeu 
of as land, labour and capjtnl : those material things which 
<iwe thoir usmfiilnetut tu human InWur beiiig classed uudi^r 
capital, and thosi^ which owe tiotbing to it heing clasHed as 
laud. The disliiicLiuu 'n obviously a loose out': for hricks 
aitJ but pioees of *?arth Hiightly worked up; and the «oiI of 
old Milled couulriwt has for ihf j(real.er part bet-u worked 
ov«r many liuit!H by man. and awes to him it« present fonii. 
.There is however a scientifif prijiciple underlying the 
dtstinctioa While man has no [lower of creating matter, 
be created utilities by putting things lut^ u UMifiil I'unn'; 
and the utilities made by him con be ii)<;rL'ascd in supply if 
there is au increaawl demand for them : they have u wipply 
price. But there ore other utilities over the mipply of which 
he bu8 uo coutrul, they are given oa a fixed t|uantity by 
nature and have therBfore no Hupply price. The t<:rm 
" liujd " has been uxt^uded by i^couoinittts su oh to include 
the pcrmaoent eioutcch of ihcnc utilities*; whether they are 
Kiuud in laud, as th>.' term in commonly used, or in acas luid 
rivers, in sun^fainc and raiu, in winds aud watcrfalla 

■ Sm Bmk a. Cluptor iii. 

* In Stoudo'a Imumt pfaroM "Ib-i ortgtntl nr SnileatnieUbU' [iro]Mstioi of Uio 
Md." Tma TbllncB, in ■ nctvvwtfay Jiccnwioii of tit* bwls ot itiit thwrj <i nat. 
■nl ol tfe podtiw wUdi Adaai Suilh and Biunla look irith ngitA Ur It, 
tfmkmtS "Dot Dodanunddb": • pbtvtp vhidi vnrartiuialr.l; cwiuot ba Irus- 
iiuA. tmt wUch nuuu the uU m it -aroTild h> bj Ui-iS. U nnt altered bjr iba 
ttrUM of nin lOtr tmlirU Slaat. t- 1. 6) 



Tli(^ linltim 

tlinl laijrl 

U ■ (r«« 
tttl fA ua> 

tiim hIjOo 
Ilii'linMluct 
[i[ ImicI in 
clnu to 
ititxt* work 

IH&lUUM 

oao: bat 
Vautt- in * 
tnitli nn- 
dDTlriiif: it. 



I 

I 



igs 



THE FEHTIUTV OF LAND. 



SMX IT. 

Ml. n. 



cniQitions 
QffenUitf. 



When we have inquired what it is that marks off luiid^ 
from tho6u uiatcriikl thiugs which wc regard as proiliicta^ 
of the laud, we shall tind that the IVindamental attribute of 
land is its oxtcnMon, Th.* right to use a piece ol' land gives 
oomiaand over a certain space — a certain part of the earth's 
sur&ce. The area of the earth ie fixed : the gcomctricJ 
relations in which any particular port of it standB to otherj 
parts, are fixed. Man hm* ni) lujutral over them ; thoy arftJ 
wholly unaffected by demand ; they have no coal of pro»j 
ductioD, there is no svipply price at which they can 
produced. 

The use of a certain area of the earth's surfijce is a 
primary coiidltioii of anything that man can do. It givesJ 
huu room for his unu actions, with the enjoyment of the > 
heat and the light, the air and the luin which nature 
ansigiiH to that area. It detemiine.s his distance ft^im, and ia^ 
a great inea.siire his relation:^ to other thiugii aud utherl 
persons. This property of " land " it is which, though as y€ 
in-iiiifBcietit j)romiiieuce ha* hijeu given to it, is the ultimate 
cause uf the distinction which nil writers on economics 
compelled to malcc betwcL-n Uiud and other things^ It 
the fouudatiot) of nmch that is uiost interesting and mc 
difficult in economic science. 

Suioe parte of the earth's surface contribute to pro- 
duction chiefly by the iserviccx wliich they render to ttu^f 
unvigator; others are of chief value to the miner; othera — 
though this selectitiQ is made by man rather than by 
nature — to the builder. But when the productiveness 
land i» spoken of our Brat thoughts turn to ita agriculti 
uea 

g 2. To the agriculturist an area cf land is the means 
supporting a certain amount of vegetable, and perhaps 
ultimal«ly of animal life. For this purpose the soil must- 
have certain mechanical aud chemical (juaiitiuK. 

Mechanically, it musl be so far yielding that the fine] 
roots of plants can push their way freely in it ; and yet 
it nmst be firm enough to give them a good hold. It mus 
not err as some uuidy soils do by atfonling water too frf>e a 
pasBOge: for then it will often be dry, and the plant 



lire 
ia^ 

y^ 

ate 
no9^ 



tu»n 

ns <iff^ 

ipe 

inaB 



MECHANICAL AMD CUEMICAL COKDmONS OP FEBnUTT. U^ 

rill be washed away almost as soon &s it ia fonnod tii thi- iMaKtv. 
r»oil or put iutu it. Nor must it err, as stiff clays do. by not ' 
allonFia^ the water a fairly free passage. For otmstaat 
tupplioB of fresh wntor. and of the air that it brings with 
it in it« journey throuffh the soU, are essential : they con- 
vert into plant food the minerals and gti»cs that otherwiso 
would be Qselees or «ven poisonous. The action of fresh air 
aod water and of front* we nature's tillngo of tho noil ; and 
even unoidod they will in time make aimoat any part of the 
earth'!! Rurfacw fiiirly fertile if the soil that they form can rest 
where it ia, and is not torn away down hill by rain and 
torrents a« noon as it is formed, Bwt man gives gre^t aid in 
this roechauieal proparalion of the soil. The chief purpose 
of hiK tillage IS to help nature to enable the Hoil tn hold 
pl&nt roolA g<^utly but firmly, and Co enable the air and 
wa[«r to move about freely in it. Even wlitiu he manures 
thtf ground lit- lias this mechanical preparation in view. For 
farmj'ajd manure beDefil» clay soils by subdividing Ihem and 
making them lighter and more open, no less than by en- 
riching them chemically; while to sandy Hoihs it glvpji a 
mnch ne<'ded firmueas of texture, and helps them, mechani- 
cally as well an chemically, to hold the materials of plant 
Ibod which would otherwise be quickly washed out of them. 

Chemically the soil must havu the inorganic elements Ch«mieaJ 
that tbu plant wants in a form palatable to it. The greater arrertiun. 
part of the bulk of the plant in madtt up of so-called " organic 
compounds"; that is. compounds of carbon chiefly with 
oxygea, hydntguu and uitrogvo' ; and of these it obtains by 
br the greater port from air and water. Only a small 
Eractioa (sotnefwhere about a twentieth on au avc-rage) of its 
dry bolk consist* of mineral matt^'r that it cannot get 
except from the soil. And as most soils have given them by 
nature at least some small quantities of all the mineral 

ibstODoes that are ncceioary fur plant life, they csm support 

> TbcT K* eaOad orgaolr. not bocaaiix Hmj rmllj tm arRUiluHl, but bocauae 
tn tamad in vesrtabla uul anunal uritauiiuiui: u»t Imjcuim b1 uuo lime 
llmiigkt that Done of Ibmi ronld b* inula ncopl ■« ■ proonu nf nritmiiln 
pvwtb. Bat LMm$ «lu)««d Uwt it iru ■ xoiataLu lo koppoao Oiat plaiiU can 
(feaarb or^guilsed tnaiwr. It miut baMOM nnoiganiMd bidon it enu b> pbtnt 

H. 13 



194 



Ta£ FERTIUTY OF UNIX 



BOOK IT. 

en. II. 



IbanfM. 



some sort of vegetation without human aid. Ofteu however 
ihcy have but very scanty provt'dun of one or two necessary 
eleineuts; phosphoric acid, potaah aud Uioe Wing those of 
which the anpplie* are most apt lo nm short. It may 
indeed hajiiwii that the delitit-'iil food IB one of which some 
kinds of plants require only a little, and then there may b^fl 
a fairly good jfrowth of just ihosu plants; hut such cases 
are rare ; and thi: vegetation generally is poor nad thii^^ 
whcuvvcr the soil is deficient iu one of the miueral coosltS 
tneota of plant life. If however it be well providod iti other 
respects, aud iu a. good condition mecboJiically, there is an 
oppv)rtunity for man to make a great cliange with but little 
labour. He con then turn a baiTeu into a ve-r>' fertile soil 
by adding a small c)uuutity of ju»t those things that are 
needed ; using in most cases either lime iu some of ite many 
forms, or those artilicia] mauurcs whicli modem chemical 
science has provided in great variety. h 

Again, these special manures are of the highest itnfl 
portance to supply particulai' mineral elemeDta of plant 
food of which the soil is robbed by the animal and vegetable 
pro<luct9 which are Hold away &oni the land. It is true that 
the soil itself haa often largo "dormant" stores of mnoy 
of these things. They art dormant becauae they are not iu 
a fit chemical and mechanical condition to be consumed by 
the plant. To bring thom into that couditiou aud make 
them " aelivf " fmHl, they must be wnll plied with oxygen 
aud carbonic acid gas. This may be efifected by proper 
tillage, eveu the subsoil being forced to give up its stores 
of dormant food, if it has them ; aud iti that case the laud 
may be kept fertile with very little aid from special manures, 
particularly if it receives a general return of its lost con- 
stituents in the form of farmyard manure'. 



> VuxtiyisA nuuiure HintkiuM omtjlbUiit iluit plant \\i» wbdU. Inu iu 
■ruinnl |^T»ii[irlloriH. It liii* ilit- atlvaiitadc ul uiiliiiu |]i<- dintnlialinii mn ibp 
whaln n( thv Kill lit ttaoiX [xirtiRlwi aI fvnr^thiii)! Uint tiie plmit <rBnu : mirh 
rootlol iit ciiiiliiot wiUi (t*c»yiiif( Tvgptablr tnnlter Unrli rnil}' la it tl\ tli»l it 
ueoda; noUiinK !■ Mt anl. Bm tlbc luiiLCTftl cl-oiuiiiilf' fonii uulj % mhjJ] put u( 
fannywd maiiurd. Tlii' htvv. bulk at ii, cicluaitv ai wntcv, coiuMtaof OTfuilc 
OtunpotiidB. t\w plant ilraivH 1m r\iici siipplj nf (!ir«ci, ■nd cmn in e*M tA 
■117 S"! bIL (■'oiu Lb* aliaat|>I)en: tliauKli it iirdTm tu obtain mjop Uinmitli 



J 



195 

§ 3. By all these uiwius the fertilEty of a »i>il cau bo book i*. 

lughl Miitlrr tnnn's control. He can by Biifliiriont labour _! ' 

miUfc aliiioi^t any land boar largy ewps, Hu caii preparo ihu ^"jI/ia'' 
■oil mticbaiiica.llv and ctiemicallv for whatevtir cridb he iui: tJ»«iut 
intends to grow Doxt. He (ran adapt hm crops to tno uattire UiobihI. 
uf ihtf sui) ami tu uiiu another; sclucting xuuh a rututiun tlutt 
each will leave the land in snch a »tUite. and nt such a time of 
jrear, tlial it can hv wurktd iip uaHily and withuut loia of time 
a, suitable seed bed for the coming crop'. He can 



The •upply at miueral cieiueiiU hi llir *>U is Ilicretoru of priniiu; fan* 
poTtjUKw: IIa lUjiitly of iiluroeiMi It lli« •.■lilet rtiiinilcRl fnrliir of iU "ooniUlion", 
IfaAl bi «f its nailitiRBa tu raoot any imiu<--diiLlu demuid (ui it : nhllf it* •uppluu of 
pbo^boric •■Hd. puUnli uiil liinn krr tin- rli'fl rlii^iiii-ji.1 (nrtiirx it iU pcntiniii-ut 
IWtflHy. Cut ilia QTRsiilc compouiKta iu (luiDfnrd monnre wid ntlicr il««;iit£ 
TCCctabIc miUiT in the miH are of iri«ftL ami uiuu tii tJil» rMiwct; foi tljtj wurk 
llw dcmant minerml ptaiit fiHvl In tkc »ijil up into nn [UTltTr Irtrtn. mill hnlil HbircrA 
of it naAj tat tku iiUuL. Cvrlulii uroiM Hlioorli sii exc«i>t1i»ia]ly la,ri[e aiiiuiiiil of 
artUB uuinnU mid tliniw toay linfjwji nut Lu cimuu Luu-k tii uuitiro Ui ihn 
[«rtt«al«r Uuid frcu wliirb tli^y «r« Ukr>ii ; »n<l o( iMiin^ any tach irfH^loJ 
ihftnliiiii ij <Kitiwt bu uttiil* goai liy [ornivard utiuiiiir williouL ffiviiig Uii? niul more 
tkkM il nnta at aoine Qtbiir ttiiui;i>. Limi- Cur Iimtuiic'C MiuutimUB nun sbutti 
auS pnlaab U Mdcii iu gral ilpiiiaiicl nn tanAj mil*, imitk^iilnrlj vlicii rixit mips 
■r* |[nnm (HI lltMu. Tint tlu> Riiint impartent eaiut a llia.t cif pUixpliiiric add. 
Of thin llu- iiui] )lu ttrsrcelj w^r auy bifiu •ja&nllty ; wLU*! pluitK, piUrlitruJutr 
earsAb reqnirn a ^'^^ 'l*^ of it. In fa«t it U bcUcvtd thnl Ultra i> ver; Uttth 
HMT tbe lorfgicc o( tb* (rrvauJ wlucli lin not hIppwIv Ut>ii inmy tiiiiiH nWrbwl 
late Ti;e«(*t>lc Aud tbuuc* liilu amiunl Ufe; and it Iu* uunri; dnnjN to be (ux)- 
j/lirA hjt HpnHiil nuuitPM to kiul (bat m mjuirnl tu i;rvw cuiilinunua t«trr 
crviM. particularly of ftTtnlT Fannyui) maiinrn RDnrralLy cimUiiw little i>f IL 
nnlaa tlu- nitlu hare hMtn led lareelf on jtratn. Uuuiaii eicri-inuiiUi uv rioU tu 
H: aiU uv of grnat aini*taii(v< In lliii way In miiut iwauuit jirupniTtun ; hut onr 
nrdcm Iwbil of waoluug towagp out ii> ma makaa Ui4 n** aif artitlda] nannrM 
muk mnm mmobu; tMu U wo,?. Ttnaiv 1* liowom at last, aittor nuuiy Ht- 
Hi^lliliMiiili. aomc proaimDI nf a TrtiiiMlj fur Uuh «rut«. 

< Tba bMl> o( moat ol Lhe moilcm BngUnl) rnlailona la Uio NoifuUi conno, 
«faMi wa* attaptad by Mr Coku (i>iTi1 LclDuiitvr] Ui uiablo linht. uid w>-(«IIm1 
"foor" ao4b Ia bciar gaoA irhMit t:ni]iH. Tlii> flint cmp nn Ills pJaii U Uimltxt 
tltay ila not Nqaif« (o be miwii till Uay or JtuieL aual tliciyrfaiv Uii> vLnt^r anil 
•fciUK bBir'tuK Hi* wlinai cn>|>, villi wltidi Lli» ituchUiik rol»tiiiii I'limi'it, cau 
Ik ■pant la UUInc elaaaitig auil mauariuH. In tlio iqiHnK of the M^md T(«r 
baffay and dansr are aowu toiMliar : lu the tblnl jvnt Xha oJuier ia futiiuninl: 
Iha luil caa b« plongbed up iu litiw fur aatnnui Muwn whi>at. vhicti tliirln tba 
■d MRU^lluBwl lUH-hanlcalty lif Uio cJover nmt* uiit impruvut vbeiuk'nlly by 
Um nlbqgan whicli Uwm vontinvaoino oxploren have hrouijlit nji from Uti> 
MbauB. Oa Uimb Enea aii InuMnav vadaljr •>t nitAtlanf. liavr Ui-ti iula|>toJ 
Id tariMiB aoOa and Muidillauaof fnniilnf, raaiif of Uiciii cxtcuiliNii oru sii or 
Mtaa 5^wi. (A llat o( tlie drief a( tlu-ui Ih f^reu in tito Mfnoir of the Ayri- 
wfaarr ^ Bw^OJid Mmd H''itlcf ftrtpani hy thr Haijitt Aynmltural l<oeitlg of 
*^T-f />' (V /nUnuirifMitl J^netdlural Canf/rtm 19'», Fas"a Sid— 8M.) 

13—2 



2i»6 



THE FERTILITY OF LANDl 



HOOK tV. 
UB. 11. 



even puTmaneiitly alter the iiatun? of the soil hy draining it, 
or by mixing with it other Miil that will supplement its, 
deficiencifs". ^ 

AH these changers are likely tn be carried out more 
exteoeively and thoroughly iu thti future than in the past. 
But uvun ni)W the greater jiart uf the soil iu old cuuntnea 
owee much of its character to human action; all that 
lies just below the surface hiLs id it a Uirgc t>'lciueut of 
capital, tbo produce of luau's past labour : th« iuJKrreDt, 
or indestructible, properties of the eoil. the free gifts of 
nature, have been largL'ly raodifted ; partly robbed and 
partly added to by the work of many generatiMis of meu. 

But it is diiferent v^-ith that which is above the stiT&ce. 
Every acre has given to it by nature an annual income of 
heat and light, of air and motBtuFe ; and over these mau has 
but little control. He may indeed alter the climatQ a 
little by extensive draluage wurk>> ur by planting forests, or 
cutting them down'. But, on the whole, the action of the 
8un and tlie wind and the rain are an annuity fixed by 
nature fur each plot of laud Ownership of the land gives 
poHsesMinn of LhiK annuity : and h aisa gives the upaco 
it-quiTcd for the life and action of vegctablE« and animaUi 
the value of thia tipace being much affected by its geo- 
graphical position. 

We may then continue Ui use the ordinary dintanctitoi 

At pmikent ratlier tnoro tlion luilf thu irnltivatml 1*nrl nt tlir t'libtMl Kliipriom If' 
in pmnniiant pd«tim ; U»l of ttas reit oilv hnlf i* in eom rraia. nlknr Inn tliAU 
B i)nwti<r i» swn croim, rUpfljr rootH, iui<l mllipr moru Ihui % qiiiBrtcr in clover 
and gruMi under roUtiun. Iu KukIuiiI tbo rcmuuiL'Dt iiuatnrc (• iirop^^tlou- 
•Itilj' In« Mill tljc rum enifi nrv etntivt tlieu iii Iroliuirl auil ftratlnnd. 

■ IlitbRtiri tbJH biu IwiTii ilcitit; iml; on n piniall m-hIi- ; [;li*!k Aiid llinn, clajr uut 
mail luw) btfori livt tlittiiy Hiir«i>l uwr Lkv fleMn; u (.■i»ii]>l«U.-tr new lall luM 
wliluau bM!U Diajlu cifopt iu nnrdciiB knil nthrr (nvniirml ipnU. Bnl It !■ 
pemlhU, anil (>v«ti iw muie tliiiik |in>l>nbl«, thai at ikidu! faluic Umo Uw 
motliBiiii'Al •KciiFicH u*cd in inakini: railiriLjY nni) uthi'r icnat canhworli* inaj W 
apjiliti] oil a lari:i- scale ui crtratius a rich soil lij niiiiiis twn jvkit ooils aitli 
(ippoititii laiillK {firr Mr SihiM Ftnm*« /tirrctliry Jut III* Improttmret of l.ojuliit 
frojieriy, ]i. ^<9.'| As II i*. wliou UiF Huliwiil ia luitkwii to co[itaiu impuriwl 
alnnnnta whidi lhc> miifuv imil luu: lout, or jierliHiiii ha* iinriTT hail, the Mlttf- 
priiing ovncl will iilii it di>4.-|>lj *> tliat ll\t air mid frrnh wntiT tiiajr aet An 
anil tiU'i a tiiii" liriufpi >iniiL- iil il u|> l<> luii vritL tliv nirfivo »iiil. 

V tin; in particular "Ttw lutJuvwc uf Trccn on Clintnto and froduclKonM 
In AwcikUi I. toVttO Btfort uf thr liultau t'tmiae ('vianiMMim, 1681. 



OEIGTNAL A>-r> ARTIFiaAL PnoPERTIKS OF LAND. 



Ifll 



between the original or iiiheni-iit prvipfrlics. which tht* land 
derives from oatun^ liud the artitieial proiwrtiLfi which it 
owii8 to human action ; provided we n?member that the first 
include the spuoc-relutioiui of thu plot in iiuustion, and the 
annuity that natunt has given it of sunlight' and air and 
rain ; and that iu many caaeit these arc the chief of the 
inherent properties of the eoil. It is chiefly from them that 
the ownership of agricultural land derives its peculiar sig- 
nificance, and the theory of rent it« spocial character'. But 

1 Ibtn la aomti intci*>l in tliv acbnnpt to lUatini^Uli that iMrl of tlin vntna 
loflml Khlrii la llie rcanll ot iiiaii'n UIkiiu-. rmm tlial uliirli [> ilm- Iu tlin uri|tin>] 

''toWj of U«n)F«. Pan nf iu xalnv U r«Uiuw) by liinlnriytL nlul atbtiT gptumi 
talljlfufuwinl* th«t wtt* RMilo fur (|]# gi^uintl purjioMa of fhe ooiuiUj, uiil trt 
mat ft i^MiBl ebuvc »n iu affi-ivaKnn'. Coimliuit tli«M Iei, List, Citiv>, BMtiat 
Mul otbm eoiitvud tbat ILu eiivuM vt liriiii;mi; IaikI frnin Uic vUta in wfakli 
buiMl it to ila fircwiit cnnilitiiHi nqnk) rn'cinl iJie trbolo tslan It- ho* now ; 
aal ham tlttj mms Out all at it* valuL- in duv tu uulu'k laliuur. Tliuir tacts 
m; todbqmUd; but Iboyim resJIjr nut rulnviuit tn tli'iiir rniir'liiiiiimii. Wliat U 
«ratnd fnr tbnir ajvnment Is Ihat i)ii> pTM«nt riiltHi of Iniiil nhoiilil nat *m?mm1 the 
4ap«tU>e, ill M> fu ■■ it cnn j>n>|n:rly Im c-linriit'll !,> iifcrii'ultiinil nii'cnitiL, of 

hriiglDit the Uii<l frviu Ihu stati.* in Kliicli tiiaii fcrtiml it to ■ cvnilltitm iii nrhinli 
ll woaU Im aa (tirtilc and gmrrally iiitxfNl (or Atrrknltiintl porposM m It now Is. 
Uanj ol the duuiKea wruuiibt in it wore iiioik' t» iiuit nKricnltiiral nioUiiKli Uial 
uu Infic niirar obaolet« ; imil m)iiii> of tkii<ui vvmi rl4<tliii?L from, n)11ii.>r (liaii dM to. 
tke Talse of the Und. And (nrthcr tli* cximimm of maldng the f)ibi>(^ miut 
b« tbe nat bX|»iiia> aft*! ii<!i1iii^ iiiileed iutnwrt. on tbe gmtUHl oiitlav, liiit alao 
aft«r ilcdQCtiiig tlw aacttsatv *aluv <>f iliv uttra pri^ww wUdi Iia*. (rou lint 
to laat. tiOHi altnlraUblD W tlie itii|>[avvnii^ut. Tbo rahw of luid iii a weU- 
paop l aJ dfatiict ia |en«ralljr mttcb irnntvr tliiui tliewi eximnws, and nftmi nuui; 
tlmaa aa craat. 

The fallawiiif taUr. talinii from llin aliiiTii qnnltul .V/moir of ikt Hojial 
Afrifulural K^>ritt^. «lMwi Uie- iuvcalineiitB of capital ptr acre on taiu Ij-piaal 
KnictMi tarnH:— 



HOOK IT. 

en. n. 

Origjiia) 
uii1 artl- 
f!c3iil|irn- 
pertiM of 
land. 







CoMflf 1 












bnu 1 


Cotttnt 








Tvial 


bulliiinii 1 Pindns 


taTvaltw 


TsiMOH 






•aloa 


•i>4 aiul TocbI Dreliwrt^ 


cil laud in 


tapnal 


Hntl. 






labourm 


rondL 1 


Iu natuial 










tuuam 


1 


nimtltlaii. 








«. a 


£. t. 


M. t. A 


A a 


A. *.*■ 


t. t. i. 


£. 1. 


Ualn' fanu..> 


T> 


13 U 


1 10 


& 


U ISO 


ISOU 


i 10 


iliTuA araUe 
















aiul paaUn 


U 


S 


i 00 





DA DO 


1-iOO 


1 to 


t»iUaa|>laad 


so 


» 7 


1 1) U 





« ISO 


10 DO 


1 


haliua (am 


HIO 


; 


1 18 4 





S£ IKS 


in UO 


s s 



Bil tta bU in bQ agileallnrAl valoM «hkib bad beenn before 18TB, trhen 
iba Uoaoir waa wviitea, baa cuutlJMicd aL an iurivuiiiK nX* nine* Uu-n, ami 
ttan an manj wlio tUtik tlial tbc riae iij the vuiuir ol Eii^liRli land ilutitig Uto 
jiaat fOWtaUon la a bare mloru t« tlii^ t'mpllnl mvpttnl In pcmiiuictii impruTe- 



19S 



THE FERnLmr OP LAND. 



iixa tv. 
en. II. 



lulqtui- 
IttlM oouat 

for BUM 

utd UMKr- 
tifloial tor 

(Men thui 
lu oiLcn. 



J 



the ijuestLon how for the fertility of any soil 19 d«< 
origiiml proportics givon to it by nature, and how far to the, 
chaugeH iu it made by maD.caimct bt> fully discu^sod withoul 
tftkiog account of the kind of produee raised from it, 

§ 4. Human agency can do much mort; to prnmote 
growth of some erope than of othors. At one end of 
Bcalu ary forefil truus ; an oalc well planted and with pU-nty of 
room has very little to gain from mau'tt aid : thfre is no way ^ 
of applying labt>ur to it so as to obtain any uouHiderabw^ 
return. Nearly the same may be said of the grass on 
some rich river buttoina wJtlch are endowed with a rich soil 
and good natural drainage; wild animals fee*ling off this 
gnaa without man's care will farm U nearly as well an h4M 
doe«; and much of the richest farm land in England, (pajing' 
a rent of £6 au acre ami upwards) would givt- to unaided 
nature almoet as great a return as is got from it nov^H 
Next c!omi;a land which, though not ijuite so rich, is still 
kept ic permanent pasture ; and after this comes arable 
land on which man does not trust to nature's sowing, bub 
prepares for each crop a seed bed to suit its special wants, 
80W8 the seed lumsulf aud weeds away thi: rivals tu it. " The 
BCtds which he sows are selected for their habit of quickly 
maturing aud fully developing just thoae parts wliich arc 
most useful to him; and though the habit of making thia^ 



niGtitH; UinC is, tliiy tliiiik tlirru Uas twii tin riiKi in Chr rrnl \a\m p( tlir orittiiial 
propurtiiTS nt l)\e Mill for aKriciiltiintl |iuri>uHH. M. Lvrujr BcautiBD |/.>/Hirri(tiiH 
dft Kirteiiri. Cli. it. I huliU that tliU liu tHuui liu- auui a\ all «vi-iiti in Bulffinm 
uid l-'i-aii«-;; (Uiil Mr Pi'll «n|>iKiriH ■ itiiiillar oiiliilDri tvltb r«||;itr[t to Eiixlaud tq* 

MI1IIU iiiaLmctivti italwIiL-a] iiurtuiiva (•«« bu .Vriiclc otx Tkt maiiny of Ott hnmd 
iit KuffluHti in Vvl. xxxii. (it tbe Juurunl nl tJiv Ko.val AKriviiltiual Svrtvtji. TIm 
^fJiLPo of tll1^ faniia lu iLc t'liIUnl Stnli^ vvrv $ll.(Hri,0(iU.ilOli in IttftO; Ibcjr nun In 
J7,W'<l,l»H«l,"*)*M''-"tilii«t«l ill golili ill 1870. Mid tu JlO.l'JT.OOOAWt III 1»!W. Uul aa 
OKii«riil Walk(>r tKiitit.8 nut tTmih Ctnmt. Viil, vti. p.'JS\. "U in a f niniliar leatait! 
of papur moui^ iiiflnUoiin tint rval vHlsti<, miM^iali; mrti rral iiulatc, fwtilMii 
Iw^iii* U) riM? Ml vvly tit i^nnlinniw to lint' u Uiug tut tlio prii^i of fc-nunoilitut.'' 
AJlowing tlicretoiD far onlj bbU Uiir jirBuiittui ou (tiiLJ hv grU Uiw valiii. (»r l«IiJ at 
$S,aMJ,0OO,l)0O ; aiiil thus airlitw lU au incrcaM ot aUnt H % ui endi of tho two 
decailwi. 

I OI courw wlivivver tli» fpM» I* mown, mniinr* ihnulil >h) n4aninl. It 
haul mrirAiiTiT rMsiitly biwji faaud Uiat luuiorLuj.' iwrtiiaiinit i)Utiin< mricli'm 
it for ■ Iftug timtt to com*; (or tliMi Um riplicut luiil flnmrt (tnuauK SuiA witliin 
tlieir ricaUi a* tnach tofA m tlief vttn ctiiiMitaB, and Are Uiofe alil« to ht»t out i 
llic &dil (lie |>CKirVT and cubrn'r aorta. 




THE DOHESnCATTOK OF PLANTS AXD AXIHJLIJ). 



selecttini can-'ftilly is only i|uite modura, uud U uven uow far 
frum general, yet the coiitmiied work of thotisanHs of years 
has given him pUiut* that have but littlu reaeriihlauce to 
their wihl ancestors'. I.^'^tly the kinds nf pmchice which owe 
most tu mau's labour and care art' the choicer kind^ of 
fruit*, flowers and vegetables, and of animals, particuiiLrly 
those which are u««:l for improving Ltieir owu breeds. For 
while nutiinr left to herself woidd select thnw- that art- he»t 
able to take care of themselves and their oifepring, man 
Bclocts t^oitc which will provide hira moHt quickly with the 
largest supplies of the things he most wants ; and many 
of the choicest products could uot hold their owu at all 
without his care. 

Thus various then arc the partii which man pU>'S in 

aidlQg uaturo to raise the different kinds of agricultural 

produce In each case he works on til) the extra Return got 

by extra capit-al and labour hue so far diminished that it will 

Ijo longer remunerate him fur applying them. Wliero this 

limit 13 »oon reached he le-aves nature to do nearly all the 

I work; where bis share in the production has been great, 

[it is because ho has boon able to work far without reaching 

I thitt limit We are thus brought to conader the Law of 

Diminishing Returu. 



nnoK IT 
en. n. 



In MJ 

cnH uie 
Kktm re- 
turn to ad- 
ditional 
caiiltal aitdj 
lalwur rti. 
tuitiiiihai 
MWDWor 
UUtr. 



I Porli^a H ia ixit niiroMW>ualilu In Uvpv llint iii liuiv jiluulti may bv ubloiuinl 
I tntf part of wlikJi win •en* ao tmiiorliiiil |>iir|H>M<. Jnil u in tlic .^rvtio 
{n0aa» «*n7 (racnMnt '>t tbt reiiiilBcr'i bucly i> turiiMl to svciiiiiil. m> il luaj 
irfffH'lT to uo «R fiKxl, or for •atnn otlior iiu|<ortant pur]""'. li"tli rix>l 
lani iMvaa. botli alMn and fmit of cnr planU, At prp««iii «* oat tb^> rru-t of Uie 

I'^Olato. ItNl Utc rial lA Uiv |iliui[ U n><.-l>aii Uim:|>I a* foinl fur oLbtr [ilautii; 
"We c*t the InkTCM of tlie ral)liiij{r. lint (\>ut null Blalk arc qmiIim). TUi.- woiiA 
tt tlif> Iwecli Uf\ tlw himhI iiikI Uie fmlt at Iho ptw tree tar lunged In gnod 
■HDnnt: Irat tlwir k-aru ara luTt Ig decay. Foaaibljr (u Ur iluom Etl« liaa 
MUEEOUd to we) elieiulral wtfOin majr nabU ni to dm U tooil aiaii; of IIiumi 
t«f»tabla Buttorii^a wtawli vv now (lituw awl^. 




ProviHioiiai An iucrc-aite lu the capital and I&bour applied in tho 
^^uLnn'. cultivation of land causea in general a less than proportiouatc 
iiicrt'ase in the ammint of pnMliiot? raised, urilL'ss il liapiw^is 
to coincide with an impmvemL-ut in the artH of agrii^uItupM. 
whici i) We learn from hi»tf>ry and by obiwrvfttion that every 

g^praf"" iL^'-riciiHurist in cvtry aga and clime desires to have the n«e 
eiiwrivmv. of n gnod den] of land; and that when he cannot got it 
I IreE^Iyi he will pay fur it, if lie has the means. If he thought 

^^^^^ that he wnnid get nn gnnd n'.<iultH W applying n.11 his eapitjd 

^^^^P and labour tu a very small piece, he would not pay for any^ 

^^^P^ but a very smiLll piece. ^| 

^M ^Lwiiiiunjr When land that requires no clearing is to be had for 

^H t 
■ >.i 



I 



cQitivaW neUiiiig, evuryoue u«:s just that quantity which he thinks 
eiu»c«ui- *^^" S^^'^ ^^** capital and labour the largest return, His cul- 
uimriia- tivation is "extensive." not "intensive." He does not aim at 

Uinr will 

(flvcwi Iq. wttiuR many bushels of com from any one acn-, for then he 

I'JV«»I1IK 111. ■ F If' 

Ketorii could cultivate only a few ncrtis, Hjm purpose la to get as 
ouuii^om large a total crop as possible with a given expenditure of seed 
'***'"^ and labour; nnd therefore hi; sows as many acres an he can 



ri-oeli- 

•*. Jt«r manage to bring under a light cultivation. Of course he may 

will ill- go tou far: he may spread his work over so large an area that 

^. '' he would gain by concentrating his capital and labour on 




k 



le could get »«« tt- 

oomniiUMl over more cjipital ant! labour sn a^ to apply more to J " 

each acre, the laud wouM give him tko iNCBEAsimi Return; 
that ia, en extra return larger in proportion thau it gives to 
hb prceeuti expunditun.'. But if he has madt: his ciilciilations 
righllv, he ia using junt ito much groumt an will give him the 
highest return; and he would lone by concentrating his capital 
aod labour od a smaller area. If he bad couunaDd uver 
iDorc capital and labour and were to apply inorc to bis present 
land, he would gain leas than he would by taking up more 
land; he would got a Deminihhing RETURN, that in, au extra 
Ktum Btnallyr iu proporliun than he gets for Ihy last doses of 
capital and labour that he now appii«!i, pro\'ided of courso 
that there ia meanwhile no pereeptiblc improvement in his 
BffricultunI skill. As his mrv* grow up they will have more 
capital and labour to apply to laud ; and in order to avoid 
obtaining a Diminliihing Return, they will want t-n cultivate 
more land But perha.p« by this lime all the utfighbuuring 
land in already taken up, and in onler to get more they must 
buy it or pay a rent for the use of it, or migrate where they 
can gi!t it fur nothing. 

This tendency to a Dimiuiahing Retunt wax the cause of Wan it 
Abrahams parting from Lot', and of most of the migrations em^fonB.] 
of which history tells. And wherever the right to cultivate ^v*"™!!*! 
laod is much in request, wc may be sure that the tendency to jl*^^"' 
a Dimiuiahing Return is in full operation. Were it not foriui:aUais 
this tendency ever)- farmt--r could save neArly the whole of his Ubimr tok l 
rent by giving up all but a smiill piece of his laud, and ^1,1.^^1 
bestowiug all hia capital and labour on that. If all the doneA 
of capital and labour that he would iii that cilhc apply to it 
gave aa good a return as those which he cow applies to it, 

[he would get from that plot aa large a prwiuce as he now 
gets from his whole litrm, and would make a net gain of all 

I his rent save that of the little plot that he retained. 

It may be conceded that the ambition of farmers oftoB 

■ leads them to take more land than they con properly manage: 
id indeed almost evety great authori^ on agriculture from 

I "TIm \aai wu uol alile to bw Ui«tn that tlie; mixlil dwell toffotbor; for 
I lUr mbat&tic* wan crut an tluX Umj eovM not ilwnl) tosvtliar." Gcund* xtU. 5. 



CAjnlal nnt) 
labcitir to (mi 



ralaivit 
toUiP 
aawnnlol 

fine*, uot 
Its viInR. 



Arthur Young; downwards, has invtighed against this mistake. 
But when they tell a farmer that ho would goiu by applyiuff 
Iiis capital and labour to a ftmaUor area, they do not neces- 
Bsirily mean that lie would get a larger gross prodiiw. It ia 
sufficient for thoir argument that the saving in rent would 
more thau coutitL'rbalaiice aiiy jirolvable dimiuution of the 
total returns that he got from the Innd, It" a farmer pa}'8 
B fourth of his produuy as rent, he would gain by concen- 
trating his capital and labour on less land, provided the extra 
do.ses applied to each aerL^ gave anythiug more thau tlirea^f 
fourths of the return thiU he got frftm the earlier dose*. ^" 

Again it may be granted that much laud, even in a 
fouutry as advanced as England, is so tinskilAilly ciiltivated 
that it roiild be made to give more than double its present 
gro.'w produce if twiL'e the present eupiial uiid labour were 
applied to it skilfully. Verj* likely those are right who 
maintniu that -if all English fanners were as able, wise uiid 
energetic as the bent (ire, they might protit^bly apply twice 
the capital and labour that in now applied. Assuming rent to 
be one fourth of the prest^ut produce, they might get seven 
hundredweight of produce fur every lour that they now gel: 
it is conceivable thai with still more iiuprovcd method* they 
might get eight hundredweight, or cvou more, lint thb 
does not prove that, «* things tuv, further eapital and labour 
could obtain from land an iDcrea^iug Return. The fact 
remains that, taking farmers as they are with the skill and 
energy which thoy actually have, we find as the result of 
univeisal observaUuu that there is not open to them a short 
road to riches by giving up a great part of their land, by con- 
Rinitrating all their eapital and hibour ou the remainder, and 
saving for their own ptK'kets the rent of all but that le- 
mainder. The reason why they cannot do this is told in the 
Law of Diminishing Itetum. 

It is iuipnrtaiit to reniemlxT that the Return to capita] 
and labour of which the Law speaks, is raea»ured by the 
ajnoiint of the pntduce raise*! independently of any chnngps 
that may meanwhile take place iu the price of produce ; such, 
for instance, a» might occur if a new railway had been made 
in the ueiffhbourhood. ur a ucw towu population had grown 



FINAL ffTATBMENT OF THE LAW. 



up Close by. Such chauges will be of vital iuiportmice when »«"« rv, 

■WL' come to draw inferences from the Law of DiniinLshing _! * 

RetuTQ, and particularly when we discuett the prt-asure of 
iumiuing popnlutiau on the incanM of Hiibniatenct^ But 
they have no bearing on the Law itself, because that has to 
do Dot with thu value of the produce roixud, but uuly with 
its aaiouQt 

We Di»ynow formulate the limitations which were im- 
plied under the words " iu geticrai " Lu our proviiMi>iml 
statement of the Law. The Law is a statement of a 
tendency which may indeed be held in check for a time by 
improvementB in the arts of production and by the fitftil 
eoutw of the dcvclopniont of the full powors of the soil ; but 
which must ultiinat*ly be<;om(? irryststible if the demand for 
prodooe should incrtaae without limit. Our tiual statement 
of the Law may then be divided into two part^ thus; — ■ 

Although an iniprovemn-nt in the arts of agricwlturi' may PiniU 
nuRe the rate of rutuni which land generally aft'nrds to any ^(ti^^j|i'„_ 
given amount of capital a»d labour; and although the 
capital and labour already applied tn any piece of land 
may have been go inadequate for the development of its full 
powMR, that some further ex]«:ndiLure on it even with the 
existing arts of agriculture would give a more than propor- 
tionate return ; yet these coudition-s are rare iu an old 
I conntry. And, except when they are prespnt. the application 
of increased capital and labtiur tu land will add a less ihau 
pmpjrtionate amount to the produce raised, unless there be 
oicauwhilc an incrL-anc in the skill of the individual cultivator. 
Further, whatever may be the future developments of the 
arte of agricultiu%, a continued increa,<M; in the application 
of capital and labour to land must ultimately result iu a 
diminutioD of the extro produce which can be obtained by a 
given extra amount of capital and lulxiur. 

§ 2. Making use of a terra suggested by James Mill, we ■*■ ^'»" °i 
tUAy regard the capital and labour applietl to land aa coo- kbuu. 
asting of equal successive Doses'. As we have seen, the 
return to the first few doses may perhaps be small and a 

) Baau dUKcahliM bi Uu InUT|i»tatioii or Iliiii Um arv couirii1e>rKl Iu ■ Huts 
■1 tli* ai4 of Uie chBfAcT. 



?M 



THE LAW OF DIMIKISRINO RETURN. 



MMK IT. 

CH. in. 



Jot*, wirtr- 

f Aim, vwr- 
ffim iff tttt- 



TIj<* iiiarBi' 
nil duaew 
not nrcrs- 
urilv t3i« 

iMt 111 

tlui«. 



greater number of dcjst^s may get n larger proporti 
return; th*" return t-o successive dnftcs may even in ci- 
ceptioiiol casoii allemat^ly rise and fall. But our law states 
that sooner or later (it boiug utways siippoBcd that there is 
moaawhUe no diange in the artK ui cultivation) a puiut will 
be reached after which fill ftirthcr doses will obtain a lens 
proport iunato relum limn iha preceding doseB, ^| 

The d(JSB which only just remunerate* the cultivator ma^" 
he Raid to be ihu marginal dose, and the return to it the 
MARoiNAL KETinx. If there happens to be in the neighbour- 
hood laud that is oilttvatt'd but only just pays its expeitsea. 
and so givts no .Kur[)luii for rent, we may siipjKJse this do«c 
applied to it. We cau then say that the dose applied to ifc 
is applied to land on the MARcjik of cultivation, and this 
way of hipeakiog haa the ad%untage of Himplicity, But ii is 
not ueccHsary for the argurauut to suppose that there is any 
6Uch land: what we want to fix our minds on i« the return 
to tlu! marginal duse : wht-thwr it happens to bt; applied 
to poor land or to rich does not matter; all that i« ncccsBary 
is tlmt it should be the last dose which can profitably be ap- 
plied to that land*. 

Whtii we »[H;ak of the marginal, or the "laat" dose ap- 
plied to the laud, we do not mean the last in time, wc mean 
that dose which is on the margin of profittible eitppnditnre; 
that is, which is applied so rb just to givt the ordinary returns 
to the capital and Inhour of the cultivator, without afTorditig 
any surplus. To take a concrete instaneo, we may suppose a 
farmer t.o btt thinking of sending the hoers over a field once 
more; and aft'er a little husilaliou he decides that it is 
worth his while, but only juRt worth his while to do it The 
dose of capital and labour spent on duiiig ii, va then the last 
dose in our present seniie, though there are many doses still 
to be applied iu neaping the crop. Of counie the return to 
thi« last doi*e cannot be separated from the others; but we 
a«!ribe to it all that part of produce which we believe would 



> Biir*nlii n*iu ki-U aviirc at thU: tliniijil] bin itid nnt emidunia it ■toongk' 
TLuwu uiiiiiiueuU of hi* iltwLriiiD wlio Uavu au|i[Kiii-il lliul 11 liaa iia k|>|<lioft- 
turn U> pltMa wbvTB all the luid |ibj« a rant, liavo miatakm Um nature ol 
argunMnt. 



THE cultivator's SURPLUS PRODUCE. 



Iiare been produced if the l'unnt:r had decided agminst 
the extra htMug. 

Since the return to the doae on ttiu lu&rgiu of cultivation 
jiwt rctnnncmcos the cultivator, it follows that he will be 
JD8t remunerated for the whole of hie capital and labour by 
as many tiniea the marginal r«tum as he has applied dosen 
in all. Whatever he gets in excess of this is the SuMi'LUS 
Pboduce of tha laud. This surplua is retained! by the culti- 
vator if ho owns thf land himiwlf ', 

(This Surplus Produoe may, under certain conditionK, 
become the rent whieh the owner of the land can exact from 
the tenant fi>r it« iitte. But, iis we shall .see hereafter, the 
full rent of a farm in an old country is made up of three 
elements: the firnt being due to the value of the noil as it 
wfut made by Nature; the second to improvements made in 
it bj man; and the third, wliich is uften the must iiupurtant 
of all, to the growth of a den-'e iiud rirh population, and to 
facilities of commouicabiou by public roads, railroads, kc) 



BOOK n. 
on. m. 

I'wAtee. 



Its trluioit 



Fit- It. 



I Lcl DH lUHilc a grttiliiral Itlnttrktinn. If ah an7 p-ri-n fl<>l<l tUnm nvm 
sipcnHnl m tKpital d CU, • mrlaiii viioiiiit uf j>ri<ilui-u ■'outil Vw ruMcd from it; 
^ccrtoiu lUButuit larcvi liiftu tliv txrnain ftuulil bv nlsnt 'li tlieic wur* uhi'viiJimI 
cm It > cs|illnl nt ill. Tll4) itiflvrnlirn hctwivii lliaw tirii mirionntH la^j be 
MganlMl •• Uio jirodncc doo to tlia llfty-tlnl iwituil: ui>l if ne kui'ihiw Uio 
eairiUl to be «|ifiliad in amcMciw Aoaa* of t'l euJi wv mi; *]w«k iif Uiia 
dflwmu M Uh prodocv iliio in the QfiTllnl Aom.'. Lvt the dosM hb iDpwMiUwl 
b otd« bfflieoMmve ei^niJ dMiiimB <i( tlio liun 0/J. 

lal Uwra HOW tn ilnmi (Ttmi Uiit illriningi «f (}ii« till* 

Hf<ii»iiillii|[ (b* flfty-lint iIqm .1/, ■ liiiu J//' at riiilit A' 

■iglei bi OD. tat ihickneaa eqtiil lu Uw kmKtb of ons 

of Um dlviaiaiM, and mcb thai iU Isiigtli ropfmmt* lh» 

■■I mil I at Ui* iVMhnw dno to Uit sny-firai <Uihi. 

BapyoM Uu* duna fn Meb wporaU) diviiiau np to Uiat 

vonwiwndl^ to tb« laat Aow- wlikli it is f(nui<I pmfll- 

abb Im r«t «■*>«> l>n^ Lot tliUlut doM l>« tli« llOUi 

ftt />, mm) /'f^ Ikv romKiKiuilinii ri-luni Uiat only jniit remiuirratn tlic fAnucr. 

Tha nmnlUM of «ach linra nill U4 ud a rarve .l/'t*. TIickiyim {iroiliicc «ill 

bv nyfenm bsr llw auin at tliiwv Uuub: Le.. aiura Ihu tliii'liiiisa uf •oeli Uub 

i« w|aal to Um latiglb of tlin divunnn cni wIiirIi tt kCutit*. I>; Ui» anv Ol'C.t. 

Lict r'fr// In drawu panilld ta />'.'. ^ruUinf- J'J/ in </; Lbcu ITU is tf^nal to r'J>; 

•Uil tiii«c /<(.' jiut tuaiuwrate* lli« famiir (ur oiui ilunv. iT'J will )u>t (vntuiivraU 

bin for anoUier : atul m? t<ic all Uio jwrtiaiiB a( tlie UUck T«rtical Uun cat nS 

Mwwa O/' and HC. T\i*if(i<^rt tbu autn of I^pw. Uiat U Uir nrua fiUffl, 

npnmite lb« tharB of the prwlan tlial ia Tnguiml (u roDiiuierati! biiii; iKltilD 

Uw p^>i«lDdir. AffGVfA, li tlie Sorplut I'Todoc*. nliicta uiilvr ofrtalii Mndlttaua 

baeouMalbc r«til. 




'IHaardo 

his Alteii- 
tluii Ui l!i« 

■UUEDH llf 

UI ok) 
coniitr;. 



Th« htIjc- 
clulo uf UK- 
tare 'a EV- 

tum to in> 

OWNdlP- 

ntiil Inlxinr 
Sr«ftt va- 



in ail old cuuutr}' it is seldum pcwsible to discover 
was the ori^ina] tttate of the laud before it wos first cuLli- 
voted. The rc-stilts of sotne of man's work are for good am 
evil fixL'd ill th« land; they cannot he distingiuBhed froi 
the result** of nature's work, but must be counted witi 
tliem. The line uf divUioii between nature's work &i 
man's work is blurred, and must be drawn more or 1 
arbitrarily. But for most piirf)o!i(>K it is btjBt tu rugard thi 
initial difiiuulties uf eoping with nature as pretty well coQ' 
qut-rud before we begin to reckon the fanner's eultivatiom 
Thus the returns that we coinit as the first closes of cap! 
and labuur are generally the largest of all, and the leudeiii 
ol" the retiim t.n diminish shown itself at once. Having 
English agriculture chiefly in view, we may fairly lake, 
Rieanio did, thw as the typical case'. 

§ 3. Let ua next inquire on what depends the rate 
diminution nr of increase of the retuniH to sncci-saive doses 
capital and labour. We have seen that there are great 
biona in the share of the pniduoe which man may claim as 
the additional result nf his own wurk over what unaided nature 
would have produced. Man's share ia nmeh larger with some 




> Thil is vv may dill mil tiit« iHb. Ill Uil- .UitUitl Itiii- ll.i for HA mini n'liirl 
A'SI'l^ M lli» trini^al carvo lur Ule n-luni lo cB|tllitl ami Lnbuttr applied iii 
BngUah •giieiiinire. 

Tit* lair of DintinUklnti Bctnm Iwors » cIom iLcology to the law of DcnuuHl. 
Tlio ivliini wliivlj liLijil ^iv(^j4 It) h drihu >i/ i^ipilul Hiui iHlxftji- iiinj Ihi ii';£HnUul mm 
Uiu price irLicli lau'l (ifftrni for tkat tliwc, LjuiiI a ivtum to •:Bi>ilil1 niid labour i>, 
Ku til api'iik.. Iicr elli'L'liiH itpuiBiiil [cir lliriii : lirr rrlunj to aay dnHu i> hi'r iVinaud 
price fur I.hhtdiMe.nii'l tlip lint ii( i«tiinii>UiBt Klin will RivntJiiincmwivnilnwiiniftjr 
thiiB bo TTifiirilnil OH livr 'l<!injtTi<l HrhiMlule : but to m\air\ cuiifiiiilini we iilinll eaU it 
h»r '■ Hi'tani SoJi^-UiK' ' . A ]i*riwn mny bi> wilUnd ta pay n Inrg^'r priifiortlMitto 
prion for a car]'ot U'l^t wuul'l covrr tlio wliiiln uf h» mam Uiui Itifitiv Uiat ironU 
lp> unl; li&lf n-k)' ; oiiil tLui hU iteuiuuil i>.'liudulB ivual4 «t uiie itaf[t ikiiw on in* 
IHMBii lllil mil II iliiiiliattloii llf ili-inniiil price fnrnn inrrrojtnl qnaiitit/. BntnMb 
eMMW nn^.aiiilLu tliFiii;uivi.-aUf ilciiiaiiJuf uiaiiy itidliiiluolN tLi»n un*v«ntinMB 
doatrof nun iLiioUivr; mi tliat ttin ii|]Srii|;itU> (btiimiiil u'linitnlii itl a KTiinp (if |iwpl9 
olvajn sliowii Uii7 ilvmiuKi \-.riee m fuJUti^ Ktvai.lllj' irilli ewrj lurrMUd In tlM ^_ 
■iiiiiuiit oSiii'od. Ill LUi- Hiuiiii wij, by ((roiipiiiK loifotliiir iiuuiy \}\aw <>( Uixl "l^^l 
niigtit nbtain a Itetnni tw)i>(Hlulv that noulil vLciw a cuiutuut diiuiuation roi oYuiy^H 
l(icn;«»v llf i/apitiil ami Inliuur o|>|ili(^. Hut It U ia«r« ca«; to aiNX<n*Jii. uul iii 
witUD «'«;■ luiirc uiiiMirtout tii uktf iiol* iif. tbe vamtiuiw of iiidiriduol dnmmiid m 
t^w of i>li)U uf land lliiLii ill Uii' eaiut uf ]h.>i)|iIi>, Auil Uiervlore onr (JiUool ivttini 
iuliudul4i in not draim onl iioa* tnihoivuKn-annuil tuiifortnailtinltmliaucf rvtnin 
W onr tjpical ilciniuid scliF^iile <lai!a of dcoiau'l prio?. 



THE UUI)£It t)V VEBTII.lTy CHAXOES WITH cmCtTMffTAKCES. 



ao3 



crops atid soils and nicthmU of t^ultivatiou than with utJmis. boosiv. 

Broadly speaking it increast.-3 iw we pass from forest to pas- "^ ^ 

ture laud, from pasture to arable, au«l from plough land to "^^J? "'''*'■ 
apadu land; ami thie is bocinise the rate of diminution of the fmiiuK to 
retum ir an a ruU> gtvatest lu iorest«, ralner letw in paaturv, rBtit«r(J 
Btill less in arable land, and least of all in spmie land. We ",',Vi"'qi8 
may say then that, a* a nilcj inau's shajv- of llit- pnxluc^^ is ^"i""'!" 
Isut when the Law of Dlminifihing RiHiini applies murtt 
sharply: if he stops off hb work soon, it is hv>ca.yi»e the return 
is rapidly diminisliinj;. 

There a no absolute measure of the richness or fertility Bmihc 
of taatL Even if there he no clmnge in the nrts of production. i^i',JJ,'(r^ 
a mefB increase in the demand for produce may invert tbe*''^'f^' 
sr in which two adjnctrut piec(« uf land rank as regards I'Il-mo of 
ility. The one which gives the smaller produce, when rimnna 
bolh are uncidtivutc^d, ur wheu the cultivation of both inram- 
lly iDlight. may rise above the other and justly rank 
the mort: fertile when both are cultivated with et|ual 
Ihoroughnessi. In other words many of those lands which 
Are the least fertile when cultivation h merely cxtcimive, 
become among the most fertile when cultivation is intensive, 
For iaatADce self-drained pasture laud may give u return large 
iu proportion to a very slight expeiiditfire of capital and 
labour, bul a rapidly diminiiihiag return to fiirthor expendi- 
ture; as population increases it may gradually become profit- 
able to break up i^oiuc of the pasture and introduce a mixed 
cultivation of roots and grains and grasses; and then the 
pctuni to further doses of capital and labour may ditniniiih 
lc« slowly'. 

Other land maken poor pasture, but will give more or 
lew libera] returns to a great deal of capital and labour 
appliett in tilling and in nianuriug it; it» retitms Co 



ram- 
■tAltrcB. 



I Ttu> rue U UloHtrAUxl by tg. 13: tcir wlim produce 
im riMi In nial niaa In Hie ntia ut OH' to Oil <m Uut tlie 
amoBBt r«i{iltr«l to ntUBiimU' tlio tmoBt tat a c)iiih< <if 
capUl moA Uboot Uw bUen frMn Otf to Oi/'J, Uit> Hnr^itna 
Pm^K* tif«« on]; Ut All'C', wblcb in mit vtrj oinda gTsaler 
Urnm its M uMcrat AllC. 



20» 



THE LAW OP III»INmiUNQ RETURN. 



OoaK IV. 
OS. ii:. 



the early rinses are not very bigh, but they dammU 
Hiuwly'. 

Again other land is manhy. It may, as did the fens of 
East England, pruducc littk* bui osiura aiid wild fowl. Or, 
as is the case in many tropical districts, (specially on the 
American Coutiueut, it may be proUlic of VL-gutation, but so 
flhroudeil with malaria, that, it is ilitliciilt for man t-o live 
there, oud atill uktu to work there. lu such coswi the re- 
tiims to capital and labour arc at Krst small, but aa drainage 
pro^fr&sses. thtjy incrfa-ie; afterwards perhaps they agaiu 
fall off*. But whuQ, huwuvcT. impruvcmcnts of this kind 
have once been made, the capital invested in the eoil causot 
be removed; the early history of the cultivation in not re- 
peated; and the produce due to all further applications of 
capital and labour conforms, at all event* so tiw as this point 
is coacemed, to the Law of Diminiehing Return.* 

Similar though \vs» cjonspicnoiis ehnnges may occur 



1 ThE* emaa in rcpTDH-Dtud iij %. IS. wliiiii m nmilar 

ProdBM) All't" about tlirco Uhim u lureo h UmoIiI Snr- 
pins. .i/zr. 



O" 



Fi(t. W. 



f 



e D 



* Tbi* ouA UmprcMiiUd in fig. 14. The ahrlimt 

Joi*(4i of cji|)it>l hiiil lnW'tir ii]>}i]litil fit till* luuL ^{vi> «0 
pool ■ retiuu. thni it woii]<l uul be wortlu nLil« to 
ftppl}^ tluiit uiilf^iis It orrv iiitriKk-il to vt-rry Qitcultr 
TsUnn IiirtlidT. But XnUtr Aairn eSrr ■» iiic3vuui){ 
FCtuni wlji(!h i-uliuiiiiilet x( /*. ntid iirt«rvFiu^a lU- 
mjniiilirti. [f thii prirn lo ixi gnt fi>r prodnoo i* hi law 
Ui«l an »oiouiil Oil" it retitiir") Ui reiiiuticniln llin 
ColliviLlur fur & iIubi; oC cBfUal niiil Ulxior, it will tbcn be otiI<r jnrt prnfltable to 
COltlTM^ thi' Innil- For tlu'ii fulUvBlioii will W cBxrii'd bh (iir lui /'": ikiiTe will 
be K linilt'ii on (Jjc mrlU'i' Juih'A rciin-xriih-tl I); Ihv arm //".[ tl". ainl k ■urplu on 
lliB later ilumiM ri<inv«i-i>l(«1 hy tlie stea h"[''"; hiiiI m Ihonn Iwu uiklmat Kjutl, 
tlie 4'nltlvBtlnn of tliu land lu fur nill util}! jiut piv iln wms- Dut If Hi* priw of 
{troilnce rwu till Ofl in lUffii'iiMil to rMDiintnt* tbecnlllvtitnrfar a doMtrf mpital 
■nil Ul'iur, llif lU'flrLt <,iii tin.- uu-linr djMaa wiU niik (o flA K, ntiil Ihe aorpliu on 
lUc Ist^^r floHM will riw) hi ^r^: Iho net narvlnx (tli« true mit iu cftM Ui» lud U 
hired nut) vill 1h< tLe (rxM-nnof A'iT iiTta II A R. t^lioiiM iJio price rise htrtber 
till O^ In mffliiuai III nuiiunoratt- tbc i-ultiraUjr for a iotr of cai>lla1 uid laboar. 
tbiN li«t Hniln" mil rill) til Ihr rnrit Urge uiiunnt ropreneutxt by tlu) ci«mb of 

* LmeliBcawaalluH tin* wlier dnu* u« pivll; mro to be nmkiu tliol 
Mill llie kotnal rautpl^. it the Iviil i> kinil viit, will tliuia (iicliid« iimltU on tbn 
in oilditiaii tn the Surylim Prvilticu ur traa luul lliu* iilivwu. Of cuone pn>Ti» 
ewu \m made Id tlie dUxruiia tor Uie rctnrui ilnci Lp tiie buullonl'a capital. 



Tire FAVOimiTB SOILS OF EARLT SBTTLBHS. 



9m 



land Already well cultivated. For iDStiince. without being aoain. 
mstTuhy, it may 1>« in need of a little druina^e to lake off the " "'' "* • 
stagnant water from it, mid to enable frpsh water aud air to 
BtreaiQ through it. Or the subsoil may happen to b« 
naturally richer than the soil at the surface: or again, though 
uiil ilself rich, it may liavt? just those properties iu whicli the 
euHac« Koil is deficient, and then a thorough R^-Htem of deep 
steam ploughing may permanently change the character of 
the land. 

Thus we Deed not suppose ihat. when the return to extra 
oa|Mtai and lahonr has begun tn dimininh, it will always con- 
tinue to do 8o. Iniproveiueut^ iu the arts of production 
mj, it boa alwayH l)een understood, raiiw generally the 
rctnm which can be got by any amount of capital and 
labour: but this in not what in meant here. The point is 
that, independently of any increase in his knowledge, and 
ttsing only those tnulhodM with which he ha» long been 
^miliar, a ^urmer finding exti-a capital and labour at his 
cctnioaud, may svinvtimes obtain an iucreuaiug return even 
at a late stage in his cultivation. His return may diminish 
and then increase and then diminish again; and yet again 
incxeaaa when he is in a position to carrj.- out some further 
^extensive change'. 

ll has boc-n well naid that iw the strength of a chwu ia 

' that uf it« weiiki>Ht link, so fert-ility in limited by that elemenfi 

in which it is hhmjI deficient. Those who are in a huniy, will 

[lejoct a ehain which hnj* one or two very weak linlcs, however 

[strong the rest may be; and prefer to it a much slighter 

[chain that has no daw. Ihit if there is heavy work to be 

lone, and ihey have time to make repaim, they will set the 

jhain in order, and then it^ strength will exceed that 

of the other. In this we 6nd the explanation of much that 

it apparently ntiBuge in agricultural histor}'. 

The fiwt settletfl in a new couufij- generally avoid Liud 
id which does nut lend iuii-lf to immediate cultivation, um Uu tt*- 

Rg.14. 
> Tki* «a«c wu KprnoutMl l>j &(;. 11. Bat mure rx- 
trair iavtaocaii <i Uuf kiuil nimvcDloil Lry li>;, H, ttv not 



14 



210 



THE LAW Of mMINISUINO llUTUaX. 



&U01I IT. 

CB. in, 

tnniH In 
tliL' var\y 
•cltlarB Ih 
nut «lwiiy> 
tliKt whidi 

clTft tlllt 

M8I re- 
tiimH Ui 
molorn 
faruion 

Xiolly 

up QDIir 

thnm. 



Tbiu iLri; 
tnminire 
of (RTtillt; 
towt bo 

ttittouriuu- 
wultlme. 



They are oftwii repellad by the verj- hixuriatico of HI 
regetalion, if it happpiis to lie of a kind thiit tliey do iiol 
waut. Tlioy do not can? to plough laud that U at all hi?avy, 
however rich it might hccoinf if thormighly worked. They 
will havo nothing to do with watoi'-i'>gg«d land. They 
generally oelttct light land which can easily be workctt with 
a double plough, and then they sow th*ir seed broadly, so 
that the plants when they grow np may have plenty of lighj^ 
ftud air. and may collect their food from a wide area. ^M 

WliL-ii Aiiit'ric-a was first sfttk-d. many farming opemtioro 
that are now ditnc by hontt- niach inory were still done by 
baud: and though uow the farmers have a strong preference 
fin* flat prairie land, frciu from stumps and stones, when: their 
machlntu can work easily and without risk, they had then 
no gn=at. objection to a hill-Hide. Thi;ir ctojm wore light 
in proportion to their acreage, but heavy in proportion to the 
capital and labour expoudud iu raiding them. 

We cannut then call one piece of land more fertile thao 
auothur till wc know something about the skill and enter- 
prise of its cultivato^rs, and the amount of capital and labour 
at their disposal ; and till we know whether the demand for 
produce ia such ob to make Intensive cultivation profitable 
with the resources at their disposal. If it is, those UaHa will 
be the most fertile which give the highest average returns to 
a large expenditun- of capital ami labour; but if not, thoso 
will bo the most fertile which give the best returns to the 
first few duties The term fertility has no meaning except 
with reference to the speeial circunistanees of a particular 
tinie and place. ^M 

But even when so limited there is some uncertainty as ^F 
the usage of the lenn. Suuietimes attention is directed 
chiefly to the power whicli land haa of giving adequate 
retunta to iiileuKive cultivation and so bearing a large total 
produce per acre ; and sornetimOB to its power of yielding a 
large Kurplua produce or rent, even though its gross produce 
is not ver}- large : thuH in England now rich arable land is 
very fertile tn the former sense, rich meadow in the second. 
For many purpoHCtt tt does not matter which of theec senses 
of the term ifi undeffitoml : in the few ousoi in which it does 



INFLl 



: OP l»I>I(OVII3fEXT8 



211 



tnattCT, an luterprotatiou clause mu8l be guppliecl iu the 
an text'. 
§ 4. Bui further, the order of fertility of different boiIr 
i» liable to be changiid by changfs in the methods of 
ciiltivalimi and in the reialivt- values of differeut crops. 
JThus wliwn at the end of last century Mr Coke mht-w^ how 
I gixrw wheat well on light BoiU by prt-piirin^ the way w-ith 
r, they rose relatively to clay snils : and now though 
in; still somclinifs lulled from old euBtom " poor ", strnie 
of them have a higher value, and are really more fertile, 
than ranch of thi.* land that used to be cJirefully ciiUivuted 
Jvbile they were left in a slAte of nsture-. 

Again, ibv increasing demand in Central Eunipe for 
wood to be used as fnci and for building purposes, has raised 
the value of the piue-co\ercd tnonntaiti s1«jh« ri;latively to 
almof^t every other kind of land But in England this rise 
has bcvu pn;vented by the substitution of c«al for wood 
as fuel, and of iron for wood as a material for ship -building, 
and Uutly by EuglaudV special faciliticii fur im)iortiug wood. 
Again, the cultivatinu of rice and jute often given a very 
high value to lands that are too much covered with water to 
bear most other croptt. And ogalu, since the repeal of the 
Corn Laws the prices of meat and dairy produce have risen 
in England relatively to that of com. It wea partly in con- 
sequence of this that, ae we have seen, those arable aoile 
that would grow rich forage rrops in rotation with com, rose 
relatively to the cold clay soiU. And at the 9ame time 
erniajient porturc recovered port of that great fall in 



Dooa IV, 
cB. tn. 

Olhw 

uicralAlivtt 
(liflwent 



1 If llw pi«* o( pralnM 1* traeli Uikt ui unemt of it Olf (tigii. Vt, ID, I4| 
I w UB birf to t*j Um eultiTatM' (or uei« ■Iam' iif i^jilUJ itinl klxnu, tbc ciilttTaliou 
I 1m mttM m Iu m Z>i will tlic pio'lacc nuscit, AOPC nil] u itnMMt in 
|. 13. UXl KTtUMt iu Hf. I3, Bud Imal lii tin- M. ItuC if Uit; dcnuuitl tot 
^Crimltnnl iirulun- m t\mc% iluit OH' u ciiniiKh Ui mpny Ilio i-ii!livtitir for ■ 
•. Xtm oulLii&tioti «iU Iw cunlud u far u If. iiud Uui |)itMltin.' nuw^l wiD 
tJOIfi". >lueli ia gnatiM In Hg. 14, twit iii Sg. lH, Miil InMt lit tg. I'i. 
oontrftat weoM bt«e bMU eiruD HUuut^'r it tt< bad MrtoMctviI tbo tUTplua 
pt«*tiae ^riMBli miMM ■fbv dedooting vbat ia ■nffiricnt to icpa; tbc ciUtivatgr. 
I wliictiifceranMa under KoiMcoDiltUaiialUe mill or tJw land. For ibuU.H/TC 
jfici- 1- v<l U tn UiB flril oana auA All'C (id Uie ■occnid; KbUe In flg. H U 
I Uie irel cww the 8XCCM of AOOVl'A otct OUfll. i.e. Uia dxcmm of PMC 
vnf ABE; and in Um tnatui] emm tba excoM of PfC ovar AWA: 

14—2 



212 



THE LAW OK DIUINISHINQ KETUBN. 



goDK rr 
on. 111. 

tiic juiorw 

■lliln IIMI 

in itiae tv- 
lalirelv to 

«a till; iiru)-* 
enrii of 
iiuiiulaliiML 
uicrekKH. 



its value relatively to arable land, whicli had resulted ftwn 
the gn>wth of population'. 

ludepcndetitly of auy chaugc in the suitability of the 
prevailing crops and mcthode of cultivation for 8p«cial boUs, 
there is a con^taut tc-ndency towards uquoUty in the value of 
different soils. lu the absence of any special cause to the 
contrary-, the growth of papulation and wealth will make the 
poorc-r soilft gain on the richor. Land that was at one timo 
entirely neglected in. made by much labour Co raiite rich 
crops; its annual income of light and heat and air, is 
probably as good as those of richer aoilB: while its iaulta 
can bo much letaeiied by Inbnur*. For the same reason the 
dspreadou of English agrimilt.ure, through which we are now 
poKoin}^ in C(»nset|uenee uf American competition, in lowering 
the value of poor lande relativf^ly to that of rich lauds of tlie 
same charactFer; and especially it it* lowering the values of 



A 


^^^^ PiB. IB. 


N 




V 


M' 




•>. 


C 


) c 


o* 



o 



) Mr Rogim (Sir CenlvTiet of Werh aiuf fPoffiA. p. 13) MlntlnlM tliAt wbile 
rirh iiiMiIow liful nliont the >uiini> viJdo, eatlnutft"! lii ftim Art or u> irciiliuriM 
■4pi BB it Iiao iiow, tlir value eiitiinbM In own uf trable liuiil hti iiicraasul nl>unt 
ftv«lol(l in tlm wtiiu tiiiin. Tliiv in pdrtl; da* to iba ilitBcnltj' tliat then wu in 
lilt MI'liI]'' j^Ki-1 III prnviiliiiK viiiler tixxl tor Mtllei 

* TliUB «'« may i.M)iiiiiArp tnn pieces ol Uiid r»|iIiWBiitM tu igt. 16 viil 17. witta 
regmni to wlitrb tlic Lnw 
vf Diiuiiiuliiiig Uctum 
acta ill • aiDiilftr way, nu 
that iholr pradiicr i.-arTnB 
hiTc wwUw >]isi>«i. 1ml 
tL« tiirinni' liiw n liiahMr 
frrtility tlinu llic ullii-r (or 
ilU tltrurvHTi ••f iiiM-iiMty •>( 
cnltiiutiim. Tlie itiue ot tlw l«ul tnitr KViiurall? bo nrprcwiiU4 by iU nuphw 
|irodiii:i; «r miil, wliUli [> Lii i-m-li tarn rf\mM:nUi\ liy AUC wlieii 0/7 la raquind 
lo r«|>iiy n tinMi of capital snil lultnnr; aii<l liy AH'f when l!>r (trowth of lumbera 
kiid wcklth ktVB mads Oir cnflineiit. It !■ i--U«r lliuC .!//<' in As. 17 bom 
a inorr (aTOoniblo itiBniM.H«iii> witli Mff in Ki*. P tlia" "I"™ JW in R«- 1' 
witb .l/ZCin fig. IB. lu tLe wine wa^. UidukU out lo Uie aune vxtani I)m tOUl 
pmloce AOI/fT lu Hr. 1" ln«r» a iuon> favouralJc i;oiii|iarii>Mi witli AOUC n 
flS. 1«. IhudoM^nrjrtnfle. IT wlU>.10/>''iiifl]i. lU, 

K. Eoroy BnoUra \llrj\ati\t\0K lU* ;(irJlf .wj, »li«p. ll.) baa mllcctol wevcnl 
(acti iUtiitntliu;' lliia lt>iiiliiiic>' »f piHiT laoila tu r)wi Iti iralnt* rolalivtiljr Ut ridi. B* 
(gnntoafnnn M. H. Cwf^ lh<< foUnn^nff fifforea aliowiu^ tl)i< rwntal In fhuica ]Nflr 
baetapa (>} Mn»| of At* olkiaca of laiirl in «Ti'ntl ootniunnca o4 tli« DtpWtsuaM 
d« I'Biin vt ds I'OiM la 18S9 ui.l l»C-i rcapoctlTelr :— 

Cl4M [ Olasa n maM VH Ck» rV Clwi V 
A. D. leas' l» -19 M W H 

A. P. ISG-: 80 T8 GO W 40 



GOOD CULTIVATION IS JL REIJLTIVE TKRM. 



SIS 



lands which return good crops tti very high cultiva- 
[; but which (jiiickly ir-lapse into a pxtr condition, uulew 
a great deal o{ capital aud labuur in cuiistautly xpent on them. 
As there in no absnhite standard for fertility, so there 
.18 tioue uf gcwd cultivation. The best cultivation in the 
richest parts of the Channel Iitlands for itistanee. involvea a 
lavish tj(|M-'iiditun: of {'a|)ital and labour on each acre : for 
they arc near good umrketj) aud have a nmiiopuly uf an 
equable and <vir1y climate. If le(V< to nature the Ean<l votild 
not be very fertile, for though it has many virtues, it has two 
weak linkw, (buing deficient in phosphoric acid and pota-^h). 
Bat. partly by the aid of the abundant seaweed on its shores, 
these links can be atrcngtht-iied, and Ihi' clmin thus becomes 
exceptionally strong. Intense, or as it is ordinarily called in 
£ugtuiid "good" cultivation, will thus rai»o £100 worth 
of early potatoes ftx>tn a single acre. But an equal expendi- 
tur« per acre by the fanner in Western America would ruin 
him 1 relatively to his circumstatioea it would not be good, 
but bad cultivation. 

§ 5. Ricardti's statement of the Law of Diminishing 
stum was inexactly worded. It is however probable that 
be inaccuracy was due not to careless thinking but otdy to 
elees writing. There are strong reasons for holding that 
he had Dot overlooked the conditions which were nece8- 
aaiy to make the law true; he seems here, as elsewhere, 
to have made the gn>at error of taking fur granted that his 
ifeaderB would supply those conditions which were present in 
tiiia own mind In any case he would have been justified in 
thinking that th««e couditions wore not of great importance 
the peculiar ciroumstanocs of Englaiul at the tiinn at 
rhich he wrut*?, and for the special purposes of the par- 
ticular practical problems he had in view. Of course he 
could not anticipate the great series of inventinns which 
were about to open up new sources of supply, iLud, with 
the aid of free trade, to revolutionize English agriculture; 
but the agricultural history of England and other coiuitrii** 
.might have led him to lay greater stress on the probability 
jf a change'. 



■eosnr. 

OB. U. 



TtwnUiM 
abtolaie 
>taiia>rd()e 
cool ooA' 



Bictrtlo'A 

BtHtuUlCUt 

of tilt lnw 
(FIU llUU.-- 

oiiraU'ljr 
wurdod. 



t«i>l lliat 
Uinriclieiit 

IniidK were 
cultl rated 
Bret: this 
li true ill 
tbi; neliau 
in which 
Rii:iLnlo 
uicaiii it: 
Init it In spt 
la I* uiU- 
nmlrmlnnil 



a new- count 

variably chosM? lh»? riehost lands, and that as populfttion 
iiiei'oasL'd, poorer aod poorer soils were gradual]}' brought 
under cultivation, h-[)ealciiig cari-IiJBsiy un thougli ihoro wen* 
an nbsoluto sUuidard of ("ertiiity. But as we have already 
sct>u, where laitd is free, everyone chooses tlial wliich is 
btj-t Rilapted for his ovii purjiose, and rhat whicti will give 
liiin. all things ct>nsiderfd. die besl return for Ills capital 
and labour He therefore, looks out for land that can lie 
cultivated at oace, and piwsL-s by laiid that has ajiy wi-ak 
iink» in the chain of il« element* of fertility, however strong 
it luay be in aome other links. But btaiiden tliai he has 
to avoid malaria, he has to think uf hl» couimiimcation with 
his markets ftn<l the base of his resources ; and in some cauvs 
the need for security agaiust the attacks of enemies and wild 
beoete outweighs all other considenitious. U is therefore 
not to be expected that the lauds which were first cboaen, 
ahould turn out always to be thtme which idtiuiatcly »x»me to 
be regarded as the most fertile. Ricordo did uot consider 
this point., BTid thus laid himself open to attacks by C-arey 
and othtira, which, lliough lor ihc greater part hiused on 
a misinterpretation of his poBition. have yet some solid 
eubstauce in theiu. 



thai ivi'iw prviiviit lii lilo nwii miiKl : if timj <Ii) tlinl Uwj irlil Hiiil iiolliiii|{ it 
Iniiwrtanor in hi» ttBtcinoiit of the l.»w vt Uimijiinliiug llctnm, or iii hlii d«dac- 
Uirtis Uoui it, 'hIiIl-L it* not trau m far as it gavr.. A» Iti>»da-i a&j» {fnlititat 
Keowai), Rori. rt.v.i " In ju<))^i|: Birarilu. it luoHt mil Iw fui|;citlMi thai it »a« 
uot bin iulerilloii Ui wtIW a Ipit-dooli iiii thi> hcIiiicj* «t I'olltlcal Kcoiioiuy. Iiiit 
oiilj' la cnmiuuuli'aif Lu Lliiwu vurwMl iu it thu r«Ltll of bi> nonucljeii lu a* tati«< 
t maniwr m pnuibla. Hniicji tip wriUa »o fiy«ioonil7 maktnc etrMa amamf- 
tioiU). atiil hU wonlm Up to Iw cxtu D>lc(l to «tlwr cawa oiily alt** iliw ronaUer- 
atioii, or Tatbu- ru-writvuti to luit tiw L-liaa««il caw." Tim fuUuvim «( Bicardn 
liavc MUL'jiiilanl Jnhn Stiinit Uill'n rt-'-ilAtraiiRnt nf tlu tiiw In vliii-l> tlir cuiKlfllcutB 
iiwvHiiary Ici maka it «ui.'t were iiitnMucrd. Nei-ntlivleiH tima randitiinu bm 
linhiliuill; iiTHoi-nl cveti mm tiy noma criticiU WTitiTt: ttimj {wraUt In iiutUiig 
foriTBivl vlint tL-i'y t^ail rt>tutatliimii of tliv Uw. but whit arv tvoUy citbur ATgu- 
UMita that thcM conditiona ought nal tn Im iiFHrLmilidl ur «■!»« atlscks u« 
iuIvKDGUB or dctluvliDiu that L«v« itwu mwlr riglitl* or wrtnglf fnin it, For 
litKtaiice M)tiie i>«oiik' linv iiifcni/'l tram tli« Lair uf Dfauluiabiux BHiuii that 
the IluKlijJi i>«i]ik* iiiiw wiiulil }k hrtter nit i( llitdr tiumlwra did not liiinmn m> 
faat. TIiIh ilortrlne Is a fair matter tor arinuiioiit; and wuin uf ibow who haT* 
iluiiid II bnva thuugbt that Uia; wan iktujiiiK Ih* Idw tt DvminiahiiiK Itcluni. 
But riiaUy th«j ir#re dtuTtng aMnMhUifr qiiit« ^iffcNiit from it. Tbc truLli uT tii» 
law tuM, 1 bcUtT*. bMS q'OMtloiiMl br uv wrltir who liaa lutirprvtod it |ira]tcrl7. 



CARET'S laSUNDKRSTANDIXOS OF RICARIW'S DOCTRINi:. 



2U 



Carey claims to have proved that "in cveiy quarter of 
world cultivation haa coiumcQced od the sidea of the 
hills where the soil vas poorest, and where the natural 
AdvaiiiEi^ft of Hiluaitoti were the leant. With the growth of 
wealth and population, men have boon seen descending from 
the high lands hounding the valley on either side, and 
coining together at its foot"'. Bn>ught up in Ireland in the 
teueta of Ricardn, he arrived in America early in this 
centurj', nnd beforr Inng wa.'* Ktrnek hy the fact, that the 
soil of New England is nearly the piwrest in America ; and 
that wlienever he saw mined houses ami the Iracies of 
abandoned rullivalion he found the aoil exceptionally 
barren. Thin net him to en4uire into the history of the 
occupation of the earth's surface; and he has collected a 
great tuaaft of evidence in support vS hia proposition that the 
geoeral progress of cultivation has been from lands which 
would be rvgardt.'d an pciur in an old and BettlwJ cuuntry. 
to thnee which would l>e regarded as rich. He has even 
argaed that whenever a. thickly peopled country is laid 
waate. "whenever population. weaJth, and the power of 
a»ociation decline, it ia the rich (mil that is ahaiidoned by 
men who fly again to the poor ouca"'; the rich »oils being 
rendered difficult aud dangerous by the rapid gnjwth of 
jungles which harbour wild beasts and banditti, and perhaps 
by malaria. 

Hia facts are drawn chiefiy from warm if aot tropical 
egions; and with regard to them hi« conclusio&g are 
^rbape true in the main. But much of the apparent 
ctivencw of tropical counlrios is deiuaive : they would 
ive a very rich return to hard work, but hard work in them 
impoBsible. A cool refreshing breeze m as much a necea- 
of vigurouB life, as food itself Food can be imported 
jfissah air cannot ; land that offers plenty of food but 
I climau* deslroj-s energy, is not more productive of the 
raw material of human well being, than land that supplies 
less food but has an invigorating eliumte. Agatu, the 
iportonce of many of C'areyH facts diminulies on investi- 

> friufipl^ of Social Heitne*, Cbkp. !▼. f i. 
■ ibid. Cll•^ V. I ft. 



BOCK tV. 

en. m. 
Cwcy, 



who li&a 
voUectvd 

•IrikiEg 
iliHtmirM 
of uvwr 
HtUan 



irliieli luTo 

nioat rt.la- 
■IiIl-. 



216 



THE LAW OF DIMINISH ISO RKTITRS. 



HOOK IT. 

CB. m. 



Maiiyol 
CKray'ii 

facta tre 
Kiwd Ulnn- 
traliuM uf 
Kkurtlo'B 
duftriiw 
rifihtlf iu- 
Uiprnlnl 
unci ileve- 



were often, in early 
Lhunc who cultivaUH 



But Carey 

that Ricar 
ilci AUll l]l» 
Mrluir fol- 



gfttion. Th« choice of New England 

was an accident. ; houses ou the hitU 

times as tbey arc now, the huuics of 

the rich but unhealthy valltya a few miles off'. 

It may then be udmittvd that Corey has proved that 
Boils which an EngEish fiirmcr would regard as poor, ore 
io very many cases cTiitivntt'd before reighbonring soiU 
which he would regard as rich. The fact-s on which the Law 
of Diminishing Return i.i based lead ns a priori to expect 
such canes to occur soiut-tiincs. Tiicir occasional occunvnci; 
is not inconsistentj as noine foreign wrilcrs havu suppoeed, 
with the general tenor of Ricardos doctrines: on the con- 
trary many nf these caseB really affoitl instntetix'p ilhi^ra* 
tious of those doctrines when rightly undei-st'Kiti ; though 
some of them are to be explaiued, an \\ah already been tiajd, 
by the necessity of providing for military- safety. ^H 

The iinportaiice uf Carey's tacts does aot then Ue in thel^ 
bearing on the Law of DLmiuishing Return, They do not 
tend to invalidate the statement that the returuji which 
a farmer will get by applying extra doses of capital and 
labour to land already well culiivuted will he lesK than those 
which he got for the earlier doses, other things being equal ; 
that iR, there being nu chunge in his nicthuds of cultivation, 
in his iiiarkels, or in the other ciHiditiwna by which he ta 
surrounded. The pnwtical importance of Corey's doctrine 
lies iu its bearing on the eoiiditinns under which the growth 
of {KipulatiuQ tends to cu>uae increased iirussure un the mea^^ 
of subsistence. ^H 

§ 6. Ricardo. and the economists of his time gt-nerally, 
were too hafity in deducing this inference from the Law 
of Dimiuishiug R>cturu. They did not allow enough for 



* FaMtng 4oini dw WMmt Vaavj Ui Bt linntti sume jeon aca, I mm H 
liMlIiig msrwtaora Ctdih tt tumrpMMil ricluve**. but the rumen' hmuM wen 
ou t)i» river lAaX* wccval tuUes aivit^. It lua; W haiil (tutl tLtii ciplMiaUtn 
uiny •N'onitt for liio Mbumioc of Uouh'k iii i-oiiipiirn lively luuTuw rivet tallayi, 
biit mil ill liTriibl rirlj j'liUiih. If. titWHVir, Vj> f^illovr t]|# niAfw wliich vhrnr 
tJi« dUtnbotiini of pijpuUtina in tlu United Stat«i at t-ft«li «ac<«ariTe mbwu. 
wti lluil tliBl brotd rivvT ^aUuvi, hkXi m tlioMi uf llii^ Lunn ifiHBitBi]i|ii auil 
ibti Ijcivct Hw] Rircr, ncro u > rolB iwnplod in ndvancc of tbo ■icisfabonriii 
aplands. 



C&BEY8 iDDinOSa TO BiCABDOS DOCTBUfB, 



817 



fie increase of etrcDgtIi that uutnuf from orfi^iiieatiou. Tbey book ir, 
paid vcrj' Uttlc heed to tJiu aatdslaacc wliicb vvvry ijU'iuur "*" '" * 
gets from tb« presence of aeighboura whether agricultiiriata ij>«"« "°- 
or townapcoplc. A very important form of this assistance Uiau..iir«t 
ID a new couDtr^' U to enable hiin to venture on rich land ^ual u ** 
that he would havij othvrvi-ise shuuuod, through fear off^'^/J.^'^i'^ 
enemieft or of malArio, Even if most of his neighbours are '" '^k^'^^^- 
fiigagwl like himself in ngriculliipe, Ihcy gradiiolly supply 
him with good poails, ajid uther meaiui of communication: 
they give him a market in which ho can buy at roasonabia 
t«nns what lie watitti, necetvuuij^s. cumfurts and luxutitiH for 
hjitwoir nod hut family, and all the vai'iaiis rei:|uisite« for hie 
fami work: they surround him with knowledge : raudioal aid, 
infttniolion and amiisenicnt are brought to his df^mr ; his 
iniud bucoines wider, and his ufficieney is in many ways 
iocrea»od. And if the neighbouring market town expands 
into a largt- indiiittrial ct^ntre. hbi gain in much gTBater. All 
his produce will be worth more ; 8ome things which he used 
to throw away will fetch a good price. He will find new 
openings in daily farming and market gardening and with a 
larger range of pnxluce he will make tuw of rotation!) that 
keep hia land always active without denuding it of any one 
the eleraKOts that are ncce?wary for its fertility. 

Of the way in which organization promote« production, 
particularly in manufacturut, wt shall have to iipuuk here- 
after. But we have already seen enough to be sure that 
even ftB legiirdii agriculture the Law of DiniiliLshing Retuni 
d^feit not apply to the total capital and Labour spent in a 
district as sharply as to that on a single farm. £veQ when 
cultivation has reached a r^tage after which each suooee- 
sivc dose applied to a field would get a lo* rutum than 
the preceding dose, it may be possible for an iucrense in 
iho population to cAuse a more.- than proportional increase 

the meaiui of subsistence. It in Lruo that the evil day is and tkia 
ily deferred : but it is deferred. The growth of population, ™JtInt"° 
'iHit checked by other causes, must ultiiuately bo checked ™j'jj "" 

the difficulty of obtaining raw pnxliice; but in spite of '""« »f l**- 
the Law of Diminishing Return, the pressure of populattou 
00 the meaua of subsijitence lOBy be restrained for a long 



ai8 



THE LAW VV DIMISISHING UETl'KK. 



nova i». 

CU. III. 



Til* T«lne 

of rtMdi air, 
li^bt. imrc 
irinnf , Aiid 
bcnalifiU 
•otnery. 



The ler- 

tllltj of 



tud of 
miUM. 



time to come by the opyiiiii^ up of new fields of supply, bj 
the cheapt-niug of railwny and Kl,i^»inship i*onim(micfttiotu^ 
and by the growth uf nrgamzalioti and knuwledge. |H 

111 the following ohaptcTs wf shnll htivo much to say 
about the pvil ufiectn of liioa! pongeKtiotiK uf population in^ 
luakiug it dithcult to got fresh air anil light, and in 8omJ^| 
csLnes fresh water. Again nntivHH of X«w Euglaud who hara 
gou« til the fertile plains of thu West, would ofton bo wil- 
ling to barter part of their hpnvy crops for the pure water 
which the barren grauLto soil of their old homes supplittl ; 
and even in England therw are many placeH, particularly at 
the sea side which are kept poor by the want of driiikiu^ 
water. Agaiu the natural beauties of & place of fashionable 
resort have a direct money value which cannot be over- 
lookc-d; but it ru-cpiireit miinc effort to rt*alire the true value 
to men. women and children of being able to stmll amid 
beuiitlful and varioiiB sceuory. 

§ 7. An hai^ already been said the land in eoonomic 
phrase includes rivers and the sea. In river-fisheries, the 
sfhedule nf rettini Ut eapitsil and labour shows a rapid 
diiuiiiutiuu. As to the sua, opinioua diffL-r. Its voliimo 
ia vast, ami fi»h are very prolific; and mime think that a 
pmctic-ally unlimited supply can be drawn Irum thu Bea 
by man without appreciably affecting the numiiers that 
remain there ; or in otlior words, that the Law of DimitUMh- 
ing JKcaum scarcely applie-s at all to »eft-fi?hcrics, that iho 
Bohcdule of the sea's returi] to additional capital and labour 
shows no sigTiB of any approciable diininiition. On Iho other 
hand it Is cont'Onded that modem methods of fiahing, 
especially trawling, destroy much spawn ; and that ex- 
perience shows a faltiug off in the productiveness of those 
fisheries that have been very vigorously worked. The 
(juestion in very important, for there ie no doubt that the 
future populalinn of the world will be appreciably affected 
as regards both quantity aud quality, by the available 
supply offish, ^M 

Tile produce of ntines again, among which may b^l 
reckoned quarricH and brickSeldH, a naid to coufbrm to the 
Law of Dimiuishing Return ; but this statement is not 



TUE LAW or BrrURN FROM FtSBEHIES AHO MINES. 



219 



;act. For the rate of growth of miiiemls in the 
ciuth is so slow, Ihut it may aliuiwL bi- tiigk-ctc-tl'. Tho 
supply of agricultural produce ami of fish is a perenninl 
Btrcftin ; mines arc an it verv Naturv's rtm-rvuir. Thu more 
ncftrly a reeenvir is cxhaustLil, the ;^caber is the labour 
of pumping irom it; but if oiie mau eould pump it out 
ill ten dayti, ten men could pump it out in aact day: and 
when once empty, it would yield do more. So the mines 
that ore being opened this year might just as ea^iily have 
been opened many years ago : if the plans had been 
properly laid in a<lvanoe, mid the roquiattc specialiKod capitnl 
and skill gut ready for the work, ten yeara' supply of ctrnl 
might have been raised in one year without any increnaed 
difficulty ; and whwi a vein had ouco given up its treasiye, 
it could pnjduce no more. This dtJferenfif- is illuKtratwl hy 
the &ct tliat the rent of a mine is calculated on a different 
principle from th:it of :l fann. The farmer contracts to 
givi! back the laud oh rich sis he found it : a mining 
company cannot do this; aiid while the farmer's rent is 
loned by the year, mining rent consigts chiefly of 
'royalties" which are levied in proportion to the Htorcs that 
taken out of Nature's storehouse*. 

There is then a certain analogy between the cases of 

iltural and of mineral produce : for we find con- 

ly iocreaaing difficulty iu obtaining a further supply 

miaenthf, except iu ao fur ne wc obtain incrt-anod power 

>'ature'8 stores through improvements in the ai-t^ of 

uning, atKl tlirough K-tter knowledge of the cuuberita of 

3e earth's crust ; aad there- ifl no doubt that, other things 



BOaK IT. 

ca. in. 



Aiauia 

givo 4 di- 
minishing 
reluru iu 
Uic Htue 
tanmo** 
tarm docs. 



* It tiu faidecd 1mm uacrt«d IbM Htp r»rlh in pmlafint; ixitmlcnni tut 
!>} cuiHC tor Clw inupoM muiib of Ita [iitoniHl livst. If llii» be Irau. It will lwv« 
k SfMl inNUMWB on tiu) fntor* nf Uie wuilil ; bill tbnn «wnia U> he lilUu ([raond 
far hoftttf IhAl II b. Tli« <|iiMUmi i« (lUeowtd it kogtU in Vol. X. of the 
Mcsot CVkmu tttfMitt of Um Cuitfd ElAlca. 

i Ak Itie*ra» Myn, PnMcifUj, Cl»{i. t». " TLo wnupvaasUMi giiwi (by Um 
Umttt for Uw uiue or (laanr b jiu'il tot iliv rftliiL- of tli» onal ar atnne wblck csu 
Iw reuovEtl tttioi tlmii. buiI bna lui cuiiiiecliuu with Uie ori^iitial ur indMnuU 
iUa povm of Ui> land. ' But bnth \m and nthart «M>in iomntiinm to Inw riilit 
of IkMM ilWiDBttoiii in diwoMiiif; Ih* Law uf Diuiiiiitiliiiiit Kftuni iii [U 
■PfltiTtliili (« nltiM. EiqM«ikll]r li tlils Iba cmw Jii !tlru<)o'> criticixm of Adam 
fliaitli't anairj ol real. t^ntipU*, Cliap. xx]*. 



220 



THE LAW OF UIUINISHLN'U RETURN. 



Book it. 
cn. ttt. 



But liuilir 
ding knd 
(liitxi givv a 
dliuiolali* 

otcou- 
ajKuit uu it. 



bemg (!<]ual, tht? cuutiuued appliciilion of (•apit.&l and Inbou 
to mines u-ill result in a (iiminishing roHiTn, Biit yet it 
seemii beet to avoid BayiiiR that mineral produce conforms 
to the Ijiw of Diminishing Ri?tum ; boeonae in other uses 
of this phrant! tht- return is part of a constantly rt'cumug 
income, wliile the pnxluce of mines iR merely ft yielding up of 
their stored up treasures. The produce of the field is some- 
thing other than the soil ; the field, properly cultivaltd. 
retains its fertility; the produce of the mioe is part of the 
mine itself. ^1 

On the other haud, serv-ices which laud renders to matf" 
in giving him spae« mid light and air in which to live 
and work, do cuiifiirm strictly to the Law of Diminiithing 
Return. By building high, by careful ventilation and 
draining, liviug j-uoiii luid working room v^n bu got for a 
great many pi.T5oas on a single acre. Land that hatt any 
special advantages of sitiuttion. natural ur acquired, has 
applied to it a coudt&utly iiicreatniug capital ; buildings 
tower up towards the eky; natural light and vcntilatioD m 
supplemented by artificial nieaus, aud the steam lift reduces 
the diaatlvantages of the highest floon*. For this ex- 
penditure there is a return of extra convenience, but it is ft 
diminishing return. However great the ground rent may 
be, a limit iit at lost reached after which it is hotter to pay 
more ground rent for a. larger area than to go on piling 
np storey on storey any further; ju«t iis tlie fanner tiuds 
thai at last a stage is reached at Vfhich more iuttiosivt) 
cultivation will not pay its expenses, and it is bettor to 
pay more rent for extra laud, than to face the diminution 
in the return whieh he woiihl get by applying more cupital 
and labour to his old laud'. From this it results that 
the theoty of ground rents is siihstaotially the same as 



< Of oooiw tto nmni 1<i C4|>lt»l opl^rl( III tnilldiiiif [i»rr*««M Tur Uic Mu-lkr 
ijnu*. Etoi nlm luv) can ba hhA alumml (or iiuUiiRH. il in clie«[M* to bnild 
huiiiHv tKii nt{ir{M Ugb Iktu OIK-: mM liitlii-TU^ it luu iRwn UigiifM cli««|im< W 
bailil (mctorivd abtnt fbor itwio* liijfb. But a l>«licf ia ErmdaK np in Auerk*, 
lUnl wLurc laiiil in iiul \\.Ty ilvAr fsckirini slitiulit U: uiUj liru Btork* tii4;li : tluU 
It, tliBt ihn rclarii a( ■rcomnioiUtinii illntinlabe* prrcopIiUr after Uw capriW 
ami labour reqoixHl la rai>e tvo atonva luTn Imwi vpeul ou tb« ttud. 



TUE LXW OP KBTUItX I^EOM BDllDINO QROOND. 



221 



of tana renu. This and similar hcts will presently bmeit. 
enable uh to simplify and extend the theory of value as ^h^^ 
given by Ricardo and Mill 



NoTR OK Ttnc UKAinxo OF THE PHBASB "A DoKii or Capital 
UXD Labocs." 



^B NOTR 

^Hf To iNgiii with, thors Im iwiuc vimuv»«ui in the notion of a (pveo 
^^^tocmnf of ca|iital luid lalionr. Pivrm klxfur in of many diScrciit kiji<b, 
nod so IB fojin cajutnL This however givm rise t^> no ditfitulty »o loog 
as we may aasuine thiugK to l>e metiHureJ by tboir moiie; pricc& A 
doM of U]rit«l and laVMiLtr tuny Ih^ In' ra^^rLrdeil a» the oiilluy of £1 
diatoibntfid aocorditig to the convonicnec of the cn«; botwpoa tbo 
euniu{p or labour of difToront kiuda (iacludiDg thnt of mauAgdment), 
the iirice of ami uni otliiT luntcrinH tbe MMt of n^uur aiid replace- 
nicnt of mftohinery, etc., and Iiutly, iiiU^rR!<.l loi nil Uiu CHjiital ecn- 
])loyed. Thin anompuoti raay fnirljr be miuli; urbiu no aro conning 
oor att«iitioii to one ploeu, nml tirai*, niiil metbod of ciiUhittiini. 

Bitt this namijoc bilii ub if wc wntib to briog to a iKitnmaii ntatiiUrd 
liM product! rmiMU of latidM in diataiil tiiiicK or placoK. W& shall then 
ban t« tail back on rough, anil more or Icea arbitnu'y modcx of ru«a- 
uremetit, whicli make no iiin) nt tiiLuinriittil jirtwijainn, init will ynt 
•uffloe for the Itniuclcr puriKWi-a of history. Thin difficulty in clottcly 
MOUCcUhI witli llial nf Hnding a conimou standard of purohaaing 
power, which wc shaU havu to dittctittH later oii. Rtit it hoa nome 
loBturm pociiliar to itself. J'or one thing there are great varlatloiw in 
tbe retativD ainoiuit« of capital and labour that c-uter into a doM. 
Iniomc oQ capital ia generally a iiiucli livx im^HirlAiit itoni tu back- 
ward than in advuicnl iftagtra of agriculture ; iit »pit^ of the bet that 
tfa« nto of interest i« gen«mlly much lower in the Uctt«r. For nioet 
porposw however it is probably Kxit to Utkr: act a i>i<uiiiioji Htandard a 
day'B unftkiUftJ laliour of given efficiency. Wo thus regard the doaa as 
made up of bo much Uhotir of differeut Idnda, and charges for the use 
and rt-placofneut of capital as wilt together make up the valuo of, say, 
' ten days' such labour; the relative pmixirtiont (if tli('M> elmnenta and 

Nthdr aerend valtuia fn tomix of mii;1i lii|K)iir lieing liii'd a<;ciirditjg to 
fte apecial oiiviimstAiicce of each pnthlem. 
' A einiilar difficulty ia found in comparing the retums obtained by 
capital and labour applied undtx diEr>Trcnt ciroiinistancea. So long aa 
the cropa are of the aamo kind, the ({iinntity of one return can be 
meaauTBd oA'againat that of another: but whcu they are of ilifTemiit 
kinds they cannot be conipared till they are reducoil to a (vmitiion 
measura of value. When, for instance, it ia aaid that land would give 
betto* returns to tbe capital and labour ex[>onded on it with one crop 



222 



THE LAW OF DISlUflSUlXG KBTURS. 



BOOK IV. 

CB. UL 



or robition uf artqtt ihiui iriili another, tlie otAteineat miut be luide 
stood to hold only on the lijuis of th« prioee At tho tintft : much error 
him ariKeo from loaing aisbt of thin UmittitioD. 

In the CAna of land cultivatty! on a ayat«m of rotjtting CKtpa, we 
mtut take the whole periwi of robition tugpthcr, rcckoDi'tig for the lanil 
boing in the aatue condition at the h<^^ning ttnA tho end of tb« 
rotation, and coimtiag oa the one hjinij a\\ the cnpitol and Ubour 
apl^liad during the wlioSe ]>eriod, and on tlio other tho uggn^to rotura^^H 
of nil the aojM. ^| 

It miAst ho rotncmbor«d that the return due to a dose of caiiital 
HOd l&hour ia not hero t&kni tti inclmlc tht- value of the uaiuiAl itm^f. 
For iostjincc, if part of tho wq^itjil on ii fiu-ni cniMiittH of two yoor old 
oxen, then the returns to a yeat'n c«.i>iUi.\ and InViour nill include not 
the foil weight of these oxen at th« end of the year, but only th* 
tidditioD that has litxin nnult- Ut it during the year. Ai^uin, vrh«» n 
C&nu«r iii SAid tii worlc nHth n cnpitikl of .£10 to the acre, thiji inchides 
the value of everything that ho hu^ on thu fiirta, But, as ha« been 
already explained, a dose of capitnl and labour apph«d to a Carra, 
th(Hi){li it includes the whole value uf tlie cinulittiag c»])it«l, auch m 
Msd, dooii not include the whole vaIur of tht; fii«d capital, niich u 
nudiiuerj' nnd horara. but only the tiiIuo of their use (after allowiDg 
(or d«|irociatJon and repiiint). 

But nlthou^h tliis in the method of meanuring capital which it> most 
generally adopted "by i-twrnotiiixts, and the one which tx to So takon fi» 
gmiitod if uotbiiig is said to the coutrary ; thoro are yet aoiiM exocfv 
tioiuil euocH ill whieh it if* bo«t to ad«ipt another. Koiuetin)e« it is oon- 
teiiimit to Miitink an though all the capital applied veK circulating 
cnpitnj applied at the bu^iTitiJiig of the ytttt or during iti and in tliftt 
awe BVCTjthing that in on the fanu al. the end of the your iit part o{ tli« 
produce- Thu8, youug cattio aro rAgardod an a sort of raw tuatcriaL 
which IB worked up in the counio of time into Iht cattle ready for thflfl 
butcher. The farm implement* rpay e\"en be treated ia the aanw way, 
their value nt tho hegiuniug of the year being taktan oa ho much circu* 
latuig capital applied to the farm, and at th« end of tho year m «o 
much produce. Thin plan eunblut im to avoid a good deal of repetition 
of conditioning clauHea as to deitroeiation, etc., and to aav« the OM <4 
wordjt in many ways. It ia often the best phui for general rsAMinings 
of ia abstract character, particularly if they are es]>ireiUMd in a niatlift- 
matjcal fonu. 




CHAPTER IV. 



THE SUPPLY or LABOUK. THE GROWTH OK yUJIBEBS. 



§ I. In the aaimal aud vegetabla wcrid the growth of 
Dunibera is gnvemnd Kimply by the t«Rdeiicy of individuals to 
propagate their specivs ou the one hand, and uii thu uther 
hand by the struggle lor lile which thiitH out vast niimbeni 
of the young before they arrive* ai maturity. lu the Immau 
race aluuc the conflict nf these two opjusiiiLg forces is 
complicated by other inSiienct-^ On the one liaud regard 
for the fiitiifR induces many individuals to contrti! their 
ttunU impuWs; ifjinetlniM with the purpose of wortJiily 
aarging their duties as parents; »omertimee, da for 
^ittstanoe during the dt^cuy of thi; Roman Em pin;, vrith the 
rilest and meane-st niotires. And on the other hand society 
^flxerciaea preaeurc on the individual by nligiuuH, moral and 
Jegal eanetionft, some timea with the t/bject of (|uitrkemiig, 
ad Bometimes with that of rcliirdlug. the growth of popu- 

ioFL. 

The study of tho growth of population is often spoken of 

though it were a modem one. But in a more or lese 

lie form it has occupied the attention of thoughtful men 

''ia all agCH of the world. To its influence often miavowod, 

somebimefi not even clearly recognized, we can iraee a great 

part of tho rules, customs and U-Tomoiiios that have been 

■enjoined in the Eant^'ra and \V>itti>m world by law-^vere, by 

loralistfi, and those muneleHE tliiukem, whose far-seeiug 

am has left its impress on national habit?. Among 

3UB races, and in times of gtvat military cuuflict, they 



BOOX IT, 
CM. IV. 

Tbegnxntb 
1)1 iinnitwrA 
[11 Ulv ulii' 
inal Biiit 

kliiKlloni* 
in a^vctod 
only bjr 
plau^iit 
cniiilitidiii; 
it) Uii< lin- 
inRti ra<« It 
ia offocted 
al»o by li«- 
ditioiM of 
ibv put 
and (nr^- 
uBsU ur tlie 
tntnn. 



Tlie fifo- 
likuia ol 
pr>f>alBtiou 

MTOUIultl 

MdvlliM- 
(iT«a older. 



224 



THE SUPl>LY OF LADOUR. THE GROWTH OF NCMBESS, 



BOO I I*. 

ca. rv. 



qnfQt i^b 
nud H.u\i' lit 
imuiMii an 
IbaqaM- 
tton wfae- 
thwiho 

StaU 
«ll(1Ul>l cu- 

conrwethr 
(Towtbel 



aimed at increasing the siiiiply of maleN capable of T>earii 
arms; aud iii the higher stage* of progress they have incul- 
cated a grtrat resjxjct for the saiictitj of human life; but in 
the lower stages, they have eueoiimged mud even curopelled 
the ruthless slaughter nf the intirm and the aged, and some- 
times of a certaiu praportiou of the female childrt-Ti. M 

With the saftty valve of thi; power of planting colonies, 
and iu the pre-sence of constant war, the legislators of aucieut 
Greece and Roinu did nob hcaitato to give special privileges 
to the fathers of many children. But thoughtful meu were 
even then awurc thut action iu the coulrary scnn^ might 
be necessary if the respcnsibilitiee of parentage should ever 
ceoflc to be burdensome;' and in Western Europe during the 
Middle Ages there may be observed as Roschor says' a 
regulnr ebb and flow of the opinion that the State shoiild 
encourage the growth of numbers. It flowed generally when 
plague or war had thinnnd out the people, or when th« four 
of war made the recruiting nfticera anxious; but it seems 
to have ebbtnl in Englsiid after the Beforuiatiou, when the 
abolition of the celil»icy of the religious ordens and the more 
sotlled state of the L-ouulry hud given a greut impetus to 
population, while the effective demand for labour had been 
diiniDished by the int-reoKe of sheep rnus, and by the eollapse 
of that part of the industiial system which had been organized 
by the monastic eatablishineuts. Later on the growth ot 
population was checked by the licentious habits that grew up 
with the later Stuart^i, and by that ri»e iu the standard of 
comfort which took effect in the general atJnption of wheat 
as the staple food of Englishmen during the fu^t half of the 
eighteenth century. At that time then* were even fears, 
which later inquiries showed to be unfounded, that the pojNi- 



< Thus AjistoUu < FoHiiti, II. 6) ulrJecU la Plato's fcbpum for fijaAlliiiiK pni* 
[imtrftnil ubidbhlng |>oT«ri; on Uw lEninud Ihnt it wonld ba nnwixbibl* iinl«m 
Uu.' Stuti: t-XDroEiMKl It Ortu eoiitrul uvn Lho jjruu'tb rif iiuiub>tm. Ami M Vtotetaor 
.Toirolt piiinU aat, Plntn hiiimrU wai iinuni iif tliti; (suw /,ai» v. 74(1: iilw 
Arislotlr. i'clilict, vtt. IC). 'I'bo piipulntlui) of (ln«C0 m mIi) U) hitve ilvrtiniil 
(rnui ll;o Borvutti contiurj u.c, uiil tlisl ut Itamc tttaa Ulo thud. (Sc« Zompt, 
liniJkfning i'm Jlurtktiin iiunlcd \<y BUtneUii in BcUouWr|;'ii Kiutdbuch. Ciaiiiu 
rIku Uuiub'h chmj oil Tht yainiitittintn o/ amieal luitwmt.'j 

■ Pplilital KMnfmn. | -JU. 



BIOTOBT OF THE DOCTRINE OF POPULAnON. 



225 



^^^ 



itluD WOH actually diniiuifihing. Pett^ had forestalled some nooi iv. 
Carey's and Wakefield's argumonta a» Co tbt advanlagt^s ^ ^' " ' 
a dcniM population. Child had argiitnl that "whatever 
tfi the depopulating of a country tcuda to the im- 
lent of it;" and that " most Tiatioiis in the civilized 
ts of the world, are more or leas rich or poor proportionably 
the paucity or pU-nty of thoir people, and not to the 
ritity or fiiiitfuhiess of their land*." And by the time 
,al thb world-struggle with I'mutic hcul attaint-d iLo height, 
the denuuids for more and more troops were ever 
ig, and when manulacturcrv were wanting more men 
their new machinery: the bias of the ruling classes was 
Dgly flowing in favour of an iucrcoBe of popuhitioiL So 
did this movemeot of opinion reach that in 17G9 Pitt 
clared that a man who had cnrichod his country mth a 
lumber of children had a claim on its assistance to educate 
om. An net, passed atnid the military anxietieA of 1806, 
'bich granted exemptiou from i&xes to the fathers uf more 
two children Iwrn In wtMllock, was repealed ns soon as 
a]X)lKim had l}t^n !!afely l(hlge<l in St Helena'. 
§ 2. But during all this tiiiio theru had been a growing Thedoc- 
iiiig amuug those who thought most seriously on social rocmtoco- 
iblems, that an inordinate incrt-nso of numbers, whether !J.™'j.ij_, 
gtrei^theutxl tlie State or uot, must necessarily cause •"'"*'•■ 
•at misery: and that the rulers of the State had no right 
to suburdinate individual happiue»u< tu the aggraudizem^t 
of the Stat«. In France in particular a reaction was caused, 
u we have seen, by the cyoicJiJ st^liishuetui with which the 
Court and its adherents sacrificed the well-being of the 
le for the sake of their own luxury and military glory. 



* Sec T«iM. I'ngrtu «/ I'otitital Economy. Lcet. va. Not* iIm that a Mon- 
)»ri>aa ol Uiv npM locrowMi bi tlie |>opnlali4iti of UMtnuij wilL tlial of tVanc* 
■^ • nkic^ uMilivi! of Ibe uidcj of Uw Frvudi CLsicbcr in IS&i Uial «4iKntkiu uid 
bawd ilHnilil bs ptvtUed M Uio )iabUc riptmif tar f^\txy Mfntilh child in All 
OKiiiHiM faaHlM. Nafmlean Uio FinI Lwl uamsd tu UJt« QDilair lib unu 
dm^ on* nrnnbrn tA anj ItaaVg ivhii'h mtitaiucd uiTcn tunln cliUilreii: aud 
Laoi* lOV., hi* [irtdeeruKif in tho ■UnftbtM' of uikii. luid eiiriiipM (mm pnUUo 
Um« IS tko*» <•)■■> Biiuriml Ixitiri* the nge of 'iO m laoil morr tLui Ivn tcgitiuifttA 
(UUkb. i&c« 0«niki'» u-ticL- ou J'opnlnlivH iji tiu> /'icrioNiuM'c i'* ^i.'<u»iniu 



226 



THE SUPPLY OF lABOUH. THE OHOWTH OF NUMDEUS- 



»00K IV. 

CB. rv. 



t>{if Jfimrv 

ateoan. 



If the humane sympathies of the PhysiocmU had been able ' 
overconn! the frivolily mid harahniiss of the privilej;ed classes of 
Frauce, the eighteenth ccntiirjr- would probably not have end&d 
in tumult and bloodshed, the march of freedom in England 
would nnt havc! ht-cn arrested, aad tho diol of progress would 
have bccu more forward than it is by the space of at least 
a generation. As it was, but little attention wan paid to 
Queanay's guarded but forcible protest: — "odl' should aim 
less at augmenting the population than at increasing the 
national income, for the condition of greater comfort which 
is derived from a good income, is preferable to that in which 
a population exceeds its income and ia ever in urgent neod 
of the means of snbsistciice." ^M 

Sir James Steuart was much under the influence of t!^^ 
Physiocrats, and was indeed in some resjwcts imbued with 
CoQtinontal rather than English notions of govemmeni: and 
his artificial schembu for regulating pijmlation' neem very 
far off from us now. With regard to ihe tendency of popu* 
latioTi to increiuHf wp to the margin of subBistenctf he accepts 
the Physiocratic doctrine that, to use Turgot's words, the 
employer "since he always has his choice of a great number 
of working men, will choose that one who will work mo«t 
cheaply. Thua then the workers an* coiiip^dltd by inuliial 
competition to lower their price ; and with regard to every 
kind of labour the result is bound to be reached — and it is 
reached as a mattor of facti — that the wages of the worker 
are limited to that which is ueceaeary to procure his su 



nstence 



si^^ 



' Sm bia Itiguiry, Bk. I. Oh. xii., " Of tie gitat tuivtmiatt ef cembiai^ff d 
rccK iligetled Thitirv ""'I n j'rrftct Knmotfdge of Fatta icilA itc ftraetieid Pari <ff 
tSnr/ratarnl in orrfrr lo nulv a Fiopte nmitiplj/," 

1 Siir la fbrmation <l la dUtrOMtUm df rMutu, I It. SUnuoV* Afm H<witi 
ore |Bk. i. CU. lit.), "Tli« genaralivs fa«nlty raaomblat a iI^W ^o*^M wUli • 
wutjjLrt, itliich klnn.ve oiorta ItMlU iu iirnpuriinn to the itiinbaUun of rMuUom: 
nhiiii TikhI Imx ti-.axtiaiiA mwa tuna witlinul ■OKinuulAtiiin or dllDlmltlou. (UK- 
ratli.iii irill iMtry uiiuilivni u lilifli u puHilile; U tlmn food CCOm* la \mi dimi. 
nUliitfl tlin ijrrtiig Ih nTitr))nnr<riiiI; t>ii> tom< of II bMomol Ihb than uotJUl^. 
jiihaliltanU will <l Iniiiii til nt Ictiil m jirapotlioii ta tlie oivnJiMrge. It an Uw oUicr 
ItAnil, food ht UicrcMcd, Clio «|ii-iii^ wliinli kUhhI ;it li, will U<Kin Ui vxcrl iImU is 
|in>|»rti»ii n- ilie nMutwiM dhniiuvboi pwpir will begia U> l>« bc4t«r fsdi Um? 
yftO multiply, wid In iinqrartlou m tliej lucnut Id nonbcn tli* food will bew> 
acwce aif«iii." 



THE PHTStOClUTS AND ADi,M SMITH. 



Adam Smith said but little on the rpieiMiion ofpopitUtion, 
(or indeed lie wrote at one of tlm ciihuiriatiug poiuts of ihu 
prosperity of the English working clashes ; but what he does 
say is wiae and well bulauccd and iii(id«ni lii lone. Accepting 
th« Physiocmtic doctrine as his btuiip, he corrected it. by 
iunstiug that the iiuces.<ian>(^ (if lile are not a RxpaI and 
dtt<;nninnd cjuantity, but have varied much from place to 
place and time to time ; and may vary mnre '. But he did 
Dot work out this hint ftiUr. And there waa uothiiig to lead 
to anticipate the second great limitation of the Phyaio- 
tic doctrintr, which htta been made pnimiueut in our tiine 
by the carnage of wheat from the centre of Amerina to 
Liverpool for le<« than what it used to cost to cany it ocroeift 
Eagland 

The cight<!enth century wore on to ita close and the next 
ccnttiry began; year by year the condition &f tbe working 
clanes in England bcearao more gloomy. An aatooishing 
veries of bail harvests ', a most exhausting war *. n change in 
the methods of industry that dislocated old ties combined 
with at) injvidicious poor law to bring the working clasees 
into the greatent misery they have over eufferej, at all oveuta 

Istnoe the beginning of tnistworthy records of English wcioJ 
history*. And to crown all, well meaning eutliu»iasti),ehi«fly 
under French influence, were [troprising communistic schemes 

fVrhich would enable people to throw on society the whole 
responsibility for rearing their children*. 

Thus while the recruiting sergeant and the employer of 
labour were calling for measures tending to increase the 



JIUOR IV. 

ai. IV. 

Ailam 
HiiuUt. 



Wmth N'U- 
lury vuiinl 
vti the 

IwUAn [ii 
kIuooi. 



> Son ITraM </ y^iion*. Bk. 1. Ob. na. anA Bk. r. Ch. n. 8ce tbo «jpr«, 
Bk. ti. Ch. I*. 

■ Tbo **Maff« price al nhntl lii tti« il«cBilc<17Tt— iTtUiDwkirli Jtilam Sniill) 
wuM. T<t.; In 1T81-11W tt wm ST*^ U-iiii mi-1800 ilwM OS*. M.: 

; laoi— iijtuii iTMeib, iirj.iMiaiiiisii— ituoii w»st*. m. 

' Km*!; in the pnaciit r.ciitar<r Hi'' Itnprriid Uxa* — for tlie gruftter |hu1 irar 
iatn ■iniiiiiiliwl IM uiie-IUUi ol th< m bolu iiimitii! of tlw nranliT i wboras nmr 
thay siw imt aiidi morr tlttn * (wnnllatb, and even of Uiia ■ grant |i«r1 in ipMil 
Oft rtnrtHim and othtir benpflts wliicb Oommiuaul lUd iiot Uim ■JTurd. 

* Sm ImIow { 7 ud kImv* Bk. i. Cli. m. ^ ^, 6. 

* BfpMlallr G«d*kl b but Ir^niry c<>iK<n<ing Vtl/itiW /-^d'cK {119!)- TiMt* 

tauue iulorwl to tbo cuBiiwiKai of U^Unu' critidtnn *4 ti^Stmy(8k. ui. 
Ch. n.) *iUi Ariatalfe'a oanBnmte tin Ihtu'a Bciiubtio [tmmgK\illir J'vUttct, 

H.S). 

15—2 



23» 



THE 8CPPLT OF LABOLTl. THE GROWTH OF NUMBERS. 



BOOK IV. 

CH. ir. 



MjiIUlii*. 



Hill urcrt' 
nieiiL luui 

t\K Onl. 



growth of popiilatioTi, more far-seeing men began to inqiiu' 
whether the race could escape dogradatiou if the uumbere 
coutiaued long to increase as they were then doing. Of 
theae inquirers thu chief was Malthua, and his Esmy on Otf. 
Principle of Population ' is the starting point of all modem 
speculations ou the subject. ^H 

§ 3. Malthiw' roasoning consiHtfi of three part« whic'a 
must be kept distinct. The first relates to the supply of 
labour. By a obreful study of facts he proves that ever}* 
people, of whose history wc havo a trustworthy record. ha» 
been so proliHc that thi^ growth of -its Duiubera would hare 
be&n rapid and continuous if it had not been checked citJicr 
by a scarcity of the necessaries of life, or some oth^r cause, 
that is, by disease, by war, by infanticide, or lastly b^ 
voluntary restraint*. ^ 

His sewKind position relates to the demand for labour. 
Like thfi first it ia supported by facts, but by a different set 
of facta. Hij showa that up to the time at which he uTOt© 
no country (ns distinguished from a city, such as Home or 
Venice), had betu able to oblaiu an abundant supply of the 
necosBarics of life after ita territory ha<l boctnme ver^' thickly 
peopled. The produce which Nature returns to tho work of 
man is her effective demand ^ar population : and he shows 
that up to this time a rapid iucreast* in population when 
already thick had not led to a proportionate increase in this 
demand*. 



1 Pint oditim 1T9S, •eoond wiil moN carcTii] cdillon In 1806. M«]Uid«' wpHi 
me tiut nil iitrvi aii'l w«r» nut aU tnui: Iml Iijb wurk Iish Um urdt of beiiiit tbe 
finrt Ui^irougli aiipLlrBtlatl of Um tniltlCtlTc nirtiind Ui imclaJ iidcnrea, Tti« ditef 
iNirliitn Uiflnture in tlia niuilcim Ijiiturifal vcLuul u( WDHuuiJa jiuUj ptieani Un 
H one of tbe itmoAen aS tlwt iicliniil niid liU work w t, oollil jHiMvaalon fnr mw. 
(TliUH ItoKbcr t'klls it itT:,^a Ji u'fi ftual Uiimcliii ia 8cLuiiilKi8'a UmmtBm^ 
coUn it '>iii ivniri Kij;<tntliuui >lur WiweiiiH^listl".) lii Lit &nil«lUlaii boMwac 
he iiiwil an luidirCiiiriitn i<liriwii wlili'li lUrl iitil cntpromi bin iW imuiliJic: sajibK 
thkl -'pnpnlatioiii Ittitln hi iiicreiun ill a ({Mitiietric nrtiu aiiil imbidiil«ncA oiiljr in aa 
nHtlanivUr, " Tlii<ri.> w mitiiy otliep anilanOM of hl» whirli leuil thveuwiTai M 
licitig niUuiulcnkioi]. uiil lur liaa almjrs bMD a favMitilc butt (or tlt4 ridieula et 
hIiiJIiiw lliSiik«ni. An nxcellent. aMOUut of Ulm (> |[iv«a fn Mr Bonar's Malliv 
anJ Am Work, 

* Tliia twL cliMk woB nut ma<]a iiruiniiieiit In liU flrsl aUtiuo. 

* Sat niDiiy ot Inn rritioi imjipow him M> linvn »t«C(4 thrir {naition nincb I 
nurtMrvuiUy tliau be did; tli«7 Uitc furguUen niicb iHwajpi •■ tbia;— "I 



MALTHU8. 



Kb 

I 

I 



Thirdly, lio draws the oonnluRion that, what had beon in 
the |«ist, was likely to be iu the future ; ami tlmt th« growth 
of population would be checked by poverty w soijig other 
use of sufleriag uolt-ss it wtrtj checked by voluntary 
restraint. He therefore urges pRopIc> to use this restraint. 
and. while leadiitg lives of uioral purity, to abstain from very 
early murriageK. 

Ilis pnsiciDii with regard lo the supply of population, 
with whiL-li alouL- wc; are directly concerned in this chapter, 
remains siil^stautially valicL The changes which the course 
of eveuls haa iritrtHluced into thv doctrine of pupuUtiion 
relate chiefly to the secoud and thinl steps of his reasoning. 
They will ref|iiire more careful study whirn wu cume to 
discuss the pressure of population on the means of sub- 
8Ut«uce; but ineuuwhilc it is iiu[Mjrtaut to bear iii mind 
UibI tho prevalent belief oa to the effectH of an incre-aee 
of population on general well-being itself exercises a great 
lEtBuence over that increase. 

After this rapid glance at the history of the doctrine 
of population, we may proceed bo state it in itfl modem 



noot IT. 
on. tv. 

The ililrd. 



er«M of 
oventii 

tiiuohia 

tfwinlrfil n» 

tti iiiialify 
bis iwutiil 
ntiA Uiinl 
■laRns bat 
not big 
am. 



§ 4. The growth in numbers of a people depends firstly 
the "naMiral increase." that i^, the excess of their births 
war their deaths; and »<>cuudly on migration. 

The number of birth.<( dependn chiefly on habits relating 
to marriage; the early history of which is full of instruction ; 
but we muBt confine ourselves here to the conditions of 
^maniago in modern civilized countries. 

The age of marriage varies with the climate. In warm 
ites where child-bearing begins early, it ends wirly, 



Wo mail I 
rniiAnr' imT 
atl«i>l)uii U> 
modern 



TUcBftoaf 

mu-rinKP 



nriew of tiui Malo n( toeiMf in fonnnr pnriixls ccimpnrMl witli t]|« jtnMiit I ftbonld 
««ri4uulj Mj Ui*t th« cTfln rptfolting from thi^ ]>niici)Jp of i<opnUtiun hive mtlivc 
Jtrntni-ti—l Unu inowied. eteu im^vi Uie <liEi>dviiut«ij;ti uf au oluinEl loU) ifuu- 
[AUK* of thttt it»3 ctnac. And If «(< cmi liulalcr tlir liopi.- tlint tliiit iKiifimtK^ 
1 be 9r«dBaIlj diMti«leil. It Aata uut mwiu uiiceaMiunlilu to l»ii<r tliml llir; «rUt 
(tfD fnrUiMr tUmlniidwd. Tbo iiin-Miw ol abioliit4! pupulntiun, wlikb will at 
an* Mkc |ik«<. will cTliUiitlj tend but llttiv to ii«ftk«n tliU OTpncUUoii, b§ 
rt*rj11iinc ilvpaniLi on Uxr iwl>lir« |>r<i|iurtioiiH I-ctwcvii pu|iiiliitiou ond food, aiid 
iHit OK llic ftbaoloU uatDbcr of llic pcvplc. Xii lliv (uniurr ]>hI •>f iliw wuik It 
i|ifitinl flui tbc oowitriea wliicli nowiaaail tlie tcwcel peuiile oTUm tnHrnnl tbo 
■Ml (Kn lb> iffaeta of tbn iirlndpU al potmlktioD." Aiuajr. Bk. it. Cb. ut. 



•230 



THE SUPPLY OF LABOUR. THE OKOWTH OK XUMBERS. 



IMlHlIt IV. 

tn. :v. 

dopctultf 
chiefly ou 

Atkil on tUn 

illfllonlly 
of Biiii])urt- 

tuniljr. 



For tliMf 

mliltUe 
cIbivuw 

mill iiii- 

Ikbuorcn 



the 

I 



in colder climates it begius lattT and euds later'; but in 
every case the longer marriages are piistpniiad b«yon<L the 
age tbat is uaturaJ to the country, th*: smaller is the birth- 
rate'. Given the climate, the average age of marriage 
depeutU chiefly on the ease with which young people caii 
etstublish thcniHclvus, aiiil &iip)Hirb a family accorcHng to the 
fttandord of comfort that prevails among their frienda and 
quaiDtaucCBj ami thcruforo it is dificreiit in diflfurcat etati 
of life. 

In the middle classcB a man's income ecldom roaches its 
maximum till he ia forty or fifty years old; and the expense 
of bringing up his children is heavy nnd InAts lor many yoais. 
The artisan earns nearly as much at twenty-one tts he ctct 
does, unless he ri.'ws to n. n-t^poiisible post, bat he does not 
earn much before he ia twenty-anu ; liia children are likely to 
be & considerable cxpeiiee to him till about the nge of fift«ea; 
unless they are Bent into a factory, where they may pay 
their way at a very early age; and lastly the iftbourer canw 
nearly full wages at eighteen, while his children begin to 
pay their own expenses very eai-ly. In consetjneneu, the 
average age of luarriagH i« highest among the middle classes: 
it is low among the artisans and lower still among the iiu- 
skilled tabourer«'. ■ 



1 Of 0D1U1W Lbe kuctli din KHueratiuii liuitadf MBimlnBuMLi'vim UiBgnintli 
(d pa^niNitlaii. If it in 'ili jiiar* in one iiUc« ani Vl In miiiCImt; tiiil iTuxoKli 
pLuw p«]nilftlii>ii ilaiibluu U1UUI m lwi> )^iFrn(irni> iliiriiig a UidUHUid jron, the fn- 
vroftieviU b«a milllau-foUl In tlio flr*i pUf^. lint Uilrt; niilIlori't<>t<t in tbeatcvul. 

* Mr F. OaUon {hynirir* i-io Ilu«iaH Fnrulttj, pp. n'iri— 1} ««llui»l«>l llat ia 
Eiijfliutd the probkblu uuiub«r ul diQil/vii ol nuiuvu uuurleil tX tlie agtw of IT. tt, 
■n %.\iA \Vi tie rnqtocUvety DU TA, bo iliiiI \l>-. tli»l v*. llist Ihnlr ralaUtB fn- 
tHitiM ireiu 6. &. 4 auit 3. See also tlie iuivniAllouaJ sIhUbUvb »l tJia miA iif tfed* 
t'li>|it«T. Coinpnrci rolnmiiH 'i luid 3, nitli eiitnimi .'i, alXar allowliig for lU^Ulnuile 
birtbK na iboini iti i^ulunui G. 

' Tlie Ivriii iimrriAX* bi Ui« tntX luiuit Iv tokm ia k wi(l« *iuwe do m tt (itrlnlo 
uot oii1_v Itignl iiinrriafir*, bnt nil Ibose Itifonuftl oiiiiutiH fililcli tae nuflhuMlf 
paniiiuu-tit iti <-hiitiu.'Lei til iiitdUl- for upvcrol jreani Bt litort Uiii irrni-tickl ivapoHt- 
bilitli-fc nl iDLninl life. TUc; lu-n nttuii n^rttrartnil «t ciii «•(!; »gf>. ui4 uut IBlfk«- 
[jnnnUy Wd tip to Irgnl niimiieuii nFIrr llio Ui|t«n aX ■tnn« jtmm. Per this riMfwi 
the BVOfAfA ngo Bt iuitrTiA>,-i> in tlie tetad umt at tli? term, wiUi wliicli aloM wv 
an hen cMioomcJ, i> hAnv tJu- K*v»gfi •«• at hgvl uMrriativ. Tlic allowaiice 
to 111! rnuln III) lliic Luid tor tL« «lioIe of tli« itorkirc cIhbmi in pmbahljr nni- 
nlilcrnlib ; lni[ it is I'o? uiia'h BTMti^r in tlir cue nt mialriUcil Ibbonran tluui of 
niijr uiliKi cIm*. Tbe fuUowliie atallallc^ iiidkI \h> iuitrjiri-ieil !ii llii- liiflil uf 
lliiii roiiuu-lt. ftiid uf IliA tact ttwt ill Etiglioh liulahlria] KtnUNtlcH atk •nlkmlrA 



IA.HRIAQC-Ri.1 



r 



^skilled labourers, when not so poor as to suffer actual doox t\. 
at and not rKStraluwd by any external cause, have seldom. ' ^' " ' 
if ever, sbown a lower power of increase than that of doubting 
ID thirty years; tliat h, of multiplying a milliou-fold in six 
hundred years, a billion-fold in twelve hundretl: and hence it 
might be inferred ft priori that their increase has never gone 
on without restraint for any cunitidenibte time. Thiii in- 
Ib cooBruied by the teaching of all hiatoiy. Through- 
Europe during the Middle Age^, and in some parts of 
it even up to the present time, unmarried labourers have 
usually tJept in the (annbousc or with their parents; white 
a married pair have generally re<]<iired a house for theuiselvea. 
When a village has as many hands as it caai well employ, the 
niitnbvr of houses is not increased; and young people have to 
wait aa best they con. 

There are many parts of Kurope even now in whicli custom jun- 1 
cxerciinng the force of law preventm metre than one boh' iu|,|^i^ 
«ach fiunily from marrying; he is generally the oldeat, '"*'■ ",J*^JJL_ 
in aomo places the yonnget>t: if any other mm marries hemnliUs- 
must leave the village. When great materiat prosperity, and 
the absence of alt extreme poverty are found in old fashioned 
corners of the Old World, the explanation generally ties in 
Bome such custom aa this with all its evils and hardships'. 
It is true that the aeverity of thia custom may be tempered 
by the power of migration; but in the Middle Age-** the free 

hf the mill o( MilDrli»i]l raro in the eloMiOi^tiau «•[ llie norkiDK olajwt-ti in uur 
<iflkli>J ntnrmi. TIiB B«gi<tnr G«iumil'ii (art)'>nmth .^niutl Ii«|mrl MM** 
Ui*l m otvbun mIkIiiI ilieiricta Uia ratnniv ot ii>»iTiii)ji.'« (or IfM — !• went *x- 
■wlnwl irilh Ibe tolkmini; ruulU; ihc numWr »lMr each (>ccii|>nUi>ii Uiliig tLu 
■ Twn« Bga «l teclMlrav ill it al iiiuTiiiKi-. ami Ihn futlinniii; iniialvr. lii liroii'kcU. 
fcliin lk« atmco agn of niiiiuiIvTs iilin ihmtM mon ol tlitti (iccu|nliuii :-' 
Uam 34'M(U4n): TeitUe IwuiU 34 38 {-H-U): Sbcwuiakcts. Tnilurs M»i 
tM-»l)[ Artkww -iS-ao (1B-70) ; Ulmnron 'Jnfifi ('if'**; Commwlnl Cli.■rt^ BliaS 
(M^iS); SbapbacpMB, Sbopmon 2667 [Q4im ; Funcfmi miJ una Id-lS Citi-nj; 
ProflMdonAl and lail^Miaiiut Clau 31 fj m*a). 

' A Inilral Inrtanc* k that ol Uio laUvjr JbcIkdmi lii tiif BsToriui AIim. 
Thsni Uie eoiUtin !■ rliridljr eiiTurctfil : aiiil (bifrB ura ■carrel)' ui; nuall cottiufM 
tn i1m vtlkf . Aidnd by ■ KTvat rnranl linn In th-e *alne ol tli4>lr troocU. *r11t> r»- 
gard U) wfaifli tht^- haTv [larraed u ffini>^itig policy. Chu luttJidiUiitii live protipcr- 
Otntj in baw" Uvaxn. Xim roaagrt ttvtlK'n and iri*t«re nctiiiK u wr*iuit) iu tlieir 
M boara or sUcnliorf . Tbey bre ut a itiniTvcil rnci- fmiu tbe work peopla In Ihe 
ulKllboOTllIK rallofs, who Iko ihkit ani) tinril livra. but trvta to tbinlt, milvaa 
I BsnM t»lhm divir optnlaiu tbnl tbe Jauhmuu |iu»)uiim ita uaterlaj pratiwrfit; 
>l too fr««t m eooL 



232 



THK SUPPLY OF t.J30UH. THE OROWTH OF MCHBEH.S. 



UOOE I». 

ua. n. 



Rowinir- 
ricacMrlio]' 

thui tlu 
pouuit 

InoU 



but uol ill 
u«w conn- 
iriea. 



mnvcmeiit of the people was hindered by stern regulations. 
Tilt; free towns Indeed often encouraged immigration from 
the country: but the rules of the ^Ids were in some respect* 
almost as cruel to people wlio tried to eacapa from their 
old homes im were those enforced by the feudal lords theio^H 
selves \ ^1 

§ 5. lu thit; respect the position of the hired agricultural 
labourer has changed very much. The towns are now alwaj-s 
open to him and hie childreii, and if he betakes himeelf to 
the New World he is likely to succeed better than any other 
claits of finiigrants. But on the other hand the gradual rise 
bi the value of laud and its growbi^ seareity h Lending to 
check the increAse of population in some districts id which 
the systtmi of peasant properties prevails, in which there 
is not much enterprise for ij|)eniiig unt uew tradeii or for 
emigration, and parents fe^l that the social position of their 
children will depend on the amount of their land. They 
incline to limit artificially the size of their faniilios and 
to treat marriage very much as a bnsinesK contmct. seeking 
always to marry thuir w)ns t-o hein^sses. Mr FnincLt Qalton 
hii* pointed out that, though the families of English peers 
are generally large, the habit of marrying the eldest sou to 
an heiress, who in presumably not of a fertile Ktock, and 
sometimes dissuading the younger sons from marriage, has 
led to the eitlnctiou of a great ramiy peerages; and in lilce 
manner among the French peasants this habit oombined 
with their preference for small families keeps thfflr numl 
almost stationary*. 

On the other band there socui to bo do coiiditioos mc 
favourable to (he rapid growth of niimbera than those 
the agricultural districts of uew countries. Luid is to 



imeu 
ibo^K 

moi^l 



' Bw e.g. BoBPn, Nir Ctnturi^i, pp. lOB— 7. 

' TliP l)lllbr«t« ill i'nUQCO i« known 1« "Btj iiiiTMoly vrilb llie {<»dglauiuic« of 
sttisU jiTutnirliHB, Iwiiifi lo^TMtin tlKnciIt-jnrtoiaaUiii w|udiUic'lw)!C«t pnrixirlioti 
ot Uiv AjnlculCnrol pnpiilaUim ore laii'luituiTB. luiil lit^bitBt ill Ibam m irUch Ibne 
ar» (evmal twu-taitl iirutirititoni. S«« Dr Ik«t)tlU>in> ^tAUUlco <|U(iI««t by 31. Yrw- 
OnjM. (Sociat f.VnnDrni/, Bk, If. Cb. i.). Tlir liirUimlo in FVhikw wma 33-.') ]ier 
1000 «t tlur boginuiug of tUe cmitui?, uiil it haa (timiniabod •U«dtl; fraen dacad* 
to dccviv UU aon it h oi.itj 'ii'6. Tliv rxtn'mr luruiltqieQ of pMMut praprittan 
nndiT tlatltitutr}' tmulitinii* inu nnUrod by UulliiiM. Sc« tor inirijinc« Itls Mvomit 
of Swiiicrlwiil (A"Muy. Bk. ii. Cli. \.}. 



in abundance, raihvays and ateaiiiships carrj away the 
produce of ihe laud and bring back in t-xchaum-- implfinyuu! 
of advanced tj^pes. and many of the comforts and hixiirie-s of 
life The "farmer," as the p(«JM,nt proprietor w called m 
Americtt, Gnds therefore that a !sr^. family is not a burden, 
but an aivistaDCe to him. H(> and thcv live heallhv uut-of- 
door lives; there is nothing to check but everything to 
stimulate the growth of mitnlters. The oaiural increase w 
Bidtid by iramigratiuu ; and ihus. in apite of the fact that 
SOCOQ clttsses of the inhabitanttt of large cities in America are, 
it is said, reluctant to have many children, the population 
has indvaecd sixtecn-fnld in the last hundred years. 

§ 6. Reference has already been made to the inBuence 
of the age of marriage on fecundity. Pcojde whosi- lives 
involve much mental strain often marry late; and tbiti 
by itself would tend to diminish their faioilteis. But further 
there can be no doubt that fecundity is diminished by aay 
groat nervous straiiL Mr Gaiton has indeed proved that 
those who do high mental work are not as a class nnprolilic. 
But then as a class they ttave rouch more than the average 
of cottBtitutional and nervous strength. And it seems certain 
that, given the natural strength of the parents, their ex- 
pectation of a large ftiinily is diminiHhed by a great incrc>fise 
^mental strain. How far this tendcnry may rpaeh is iindei' 
ite: but there are some who think it so strung aa to 
sake it probable that the progress of civilisation will of itself 
■bold the growth of population eouiplptely in eboekV 

There Beems to be less ground fur the belief, which was 

at one time held by manjK .people', that abundance of the 

. of life diminishes fecundity. No doubt this effect 

vs from excetuive eating aud lazy aelf- indulgent habits 

of life. Rit any increase of the necessaries and comforts 

kof life thai in likely to fall to the share of the working 

is shown by more recent investigations to be likely to 



BOOK IT. 

oa. IT. 



PecitnAiir 

IK ^iiiii- 
Htniiii; 



luiit hy 

Inmry. tint 

itat hy UitT 

tb»Mie« of 
lutrdaliip. 



I Bm •qmuUj Bo-lHn-t Spontvr, Pwintlptt* 0/ Biolvg^, l>aTt ti. 

■ III (■r&«kr DonliUdaj, Tmt /.mm tt/ Poptjan'on. Sm kbo 8*dler, Late 4^ 
PofatiBtum. Adwn Simtli nud that poor HigMiuiil wntncn ft«qnon4r hod tvaiQ 
tUUnn vt mtatD not man Ihan two iwiclitd maturU.'c. ( tt'toUh of HAiimM, Bk. 



2U 



THE SUPPLV OF LABOUa THE GROWTH OF NCUBEBS. 



ni>oK tv. 
at. n. 



FiijiulBtiugi 



Tim cell- 
buy of tlia 

rall^oiu 
unluni. 



Ploffannni] 



Tlw^itiffl- 
(.'■lilies ci 
luigi&tioii 



iltafotlm 
Insaner- 



increase the rate of growth of population' ; provided of 
coui-so that it is not accompanied by a. growing diBlil^J^^ 
having a larffe family. ^^^H 

§ 7. The growth of population In England has a mwv 
cloarly dofint'd history than that of the United Kingdom, and 
we shall iind E«ome interest in noticing its chief movctnents. 

The reatniJuts on tlie increase of uuinbem during the 
Middle Age» were the ttame in England as elsevhere. In 
England ha t'l«owberu the religioiis ordern were a refuge 
to those for whom no establishment in marriage could be 
provided ; and religious celibacy while unduubt-edly acting in 
wjme measure as an independent check on the growth of 
population, i^ in the main to be regarded rather as a method 
in which the broad natural forces tending to restrain popu- 
lutiun expnritMKi themselves, than as an atlditiun to thviD. 
Infectious and contagious di)tease«, both endemic and ein> 
demic, were caused by dirty habits of life which wore even 
worse in England tlum in the South uf Europe; and famines 
by the failures of good harvests and the difficulti<» of com- 
munication; though LhiA evil wa8 less in Euglaud than else- 
where. 

(>)untry life was as elsewhere rigid in ita habits; young 
people found it difficult to est.ablish thomsei'vee until some 
other marric^'d ymr hod pa.sMed from the itcenc and made 
a vacancy in their omi parish ; for migration to another 
parish was acldom thought of by an agricultural lalxHirer 
under ordinary circumstances. Consemiently whenever plague 
or war or lomiue thinned the population, there were always 
many waiting to be married, ^bv filled the vacant places; 
and being perhaps yyungcr and stronger than the average of 
newly married couples had larger families '. 

There was however some movement even of agricultural 
labourers tovrards di&tricts which had been struck more 
heavily than their neighboura by pestilence, by famine or tt 




■ MalUiva' nraurk llial Uia rajHmlncUvo poirar la I«m in iMih&rouii tfaui : 
civUiMd rMMa lias beca cxUudcd bf l>v<r{ii to tba kiilmal ud rofceUbln kin 
BQiMndljT. (DcttmC of Han, Part I. Clk. iv.) 

) TliDH «• un tcilil lh>t afUr Uie Illa«ti DmUv of 1348 moM nurrfasu kdt* 
' [ertilu (Ituttunt. liMoiy vj' AyAculluit and I'nrfi. Vol. I. p. ROl). 



FOPtJLATION OF ENGLAND IN THE UtDDLE AQES. 

sword Moreover artisans were ofteii more or less ou the noomv. 
move, and this was t^epecialiy the case with those who were "*' " ' 
oti^agcd in tbo buildiug trades, and tho«o who worked in 
metal and wood ; thouRh do doubt the " wander years " were 
cliiefly those of youth, and after these were nver the wanderer 
was likely to settle dowu in the place in which he was bora. 
Again there seems to have been a good deal of migration oo 
the part of the retainer? of the landed gentrj-, especially of 
the greater b&rous who had scats iu several part« of tlie 

[Country. And lastly, in spit« of the seliish exchmiveness 
which the gilds developed as yoors went on, the (owiis 
oflen>d iu Eugluiid a« elsewhere a refuge to many who 
could get no good oiM-ninga for work and for marriage in 
their own bometi. In thetiy varioim ways some elimticily whs 
introduced into the rigid system of medieval economy; and 
population was able to avail itself la some measure of the 
increased demand for labour which catne gnulnally with the 
growth of knowledge, thi^ establish mcut of law and utder.aad 
the deTelopment of oceanic trade'. 

In tlie tatter half of the HeveDteenth aiid ifae first half of 'The Set- 

[the eighteenth century the ceotnil government exerted itsflf Lnin. 

* Tbcff* ta no cerUiii koonUdcc to ba had ■> to Uiv Aou^tj ol pojiuJktloa in 
f £nKluid before Uit Fixlitnculb twulnij- Ptvf. Sokuih wIiUb iwrM'ini.' wltb Mr 

Snliotiiu iLat Uio KIatIc Dntb of IMO ilMtroyml mix hull at Uio iKi]ialatiAn. la 
I hielltiiid Iu i»kv cnnaiilcrably IrnvT ntiuutoa Uiui Ur SnplMiLiiri for Uiu R'hoto of 

Uw UkliUo A^ftl» umI to Iblnlt tlut [>orR)ftllAii HoabM dnrtnff tiio a»T«iiiMtiih 

tanlinf. {Uiiiirry of Agr'\eH\tiirt and t'littn. i. pp, &G to.. t». |ip. 183 Sic, n. 

vgf. 789 Ac) HvTatUielwB Ur Becbgha'a wtiwatm (fartnigittji Ktrittr. Vol. m, 
tV, 8.) pn>)«blj iItb cu ft imfy traitwartlij gniKsni] rictr. Tbc flsorM In squrc 
' braclttrta aw **nwf«ly coiijVilnr*!."* 

AgriculluiKl. Nwi-imriL-iUtiml. tottt. 

IdSS 1) inUlioiui , i mntkiii 1 laitiian* 



If ir« an lo tnutl BMrlios If/tKriylitm t(f Enalatul, Bk- U. Cb. XYl.), Ibe 
' miiatar 4i( man khln (or xirricii in liH tmmtnvfl tn t.l72,lr>4. 

Tb* BUdi OmUi ••■ Knuluid'i uiil; *i?iy ^ivui L-Lliuuii.v. Sb« (tuh iiuI. Itku 
tlw raal (rf Enrapi). Uablc Ut lUvwiUtiiig vrnm, muli m t!i« Tbirt; Ti«r»' XSar 
whidi 06utroj*i mopt ihjui lujf Ui« papQlalian at Oemiiuij, a lom triiioh it 
imjiuiM *fal]««ul«(7 to r«cov«r. (Sm B(iiut<lui'a uisttmlivv artklu vu IhwCt- 
itna^iUir* fai SclilinbMg'a JlafiMuci.') 



^36 



THE SUTPLT OP LABOUR. THE OBOWTH OF NUMDEB& 



awn I*, 
on. IV. 



Rlw in Uii- 
■iHiiilunl 

of liviiie III 
tiic ni-Hi 
liall i)f tlit^ 



caoH (ha 

UIITUl o1 

Inmi, luiil 

uutfnitiiai 
and •ottlc- 
rnimt, fill. 
InH'Ofi bj 

l>ml tmr- 

vuhU nuit 

ill nilvuol 
invtlimlii of 
poor rrlisf 



ti> hinder the adjnstmeat of the supply of population in differ- 
ent parts of the couutiy tu thv demaud for it by Kuttlemtut 
Lews, which made any one chargeable to a parish who had 
resided there forty days, but ordered that he raight be sent 
home by force at any time within that period \ Landlords 
and fiirmerB were so eager to prevent people from getting a 
" settlement " in their parish that they put great difficulties 
in \\\f way of building cottnges,nnd sometimes tvon razed them 
to the grountl. In mnaequunce tht' agricultural population 
of England was stationary during the hundred years ending 
with 1760; whik the niauuffictiires were not yet sufficiently 
duvL'l(Ji»ed t() absorb large numbera. This retoirlation in ihe 
growth of numbers was partly caused by, aud partly a. cause 
of a rise in the Htandaifl of Hx'ing; a chief element of whieh 
wa* an incn;o*yd use of whuat in lUk place uf inferior grain^^ 
ax th« food of the common people *. ^M 

From I7fi0 onwardH those wtio could not establish ttiem- 
aelven at home found little difficulty in getting emplo^Tneat^ 
in the new manufacturiug or tniuing dii^tricts, where th^H 
demand for workers often kept the local authorities from 
onforcing the removal clauses of the SutLlenient Act. T* 
these dislricta yoinig pwople resorted freely, and the birtl 
rate in them became exceptionally Wgh : but so did th< 
death-rate also ; the net result being a fairly rapid growtlp 
of popnintion. At the end of the century the Poor Law 
again began to influence the age of marriage ; but this tii 



■ Ailftin fimUli )■ JfiKtlj InAlEnnnt at Ihla. (Bc« U'tiiih of yMUmt. Dfc. 
I. Cli. I. Pnrl II. aud Book iv. CL. u.). Thi» Mt rocllM tl* aiwl™ 11. *■- 19, 
A.i>. ItilS'ii IlinL "bf muuin of Niimn ilvrHi'lH In ihi> Inw, [uvit ]h.*oji1«' fti-« not 
renli'iiliKMl from t^ing from tsXi^ piiriMb to utioUivr. itnct thcrcbj Ha ciidravixir In 
»'itl1<' [ImniKitlvtni in tliniu' pftriiiiici wIk-tc llittrv i» tli* \k!»\ ittock, Uie hrgflrt 
-Kiiilci or eviiiiuouK tu builtl rultacni xaA tbc a>c«t n-mxbt lor tbcin lo Irani «tA 
AvaSjuf. «lc." auil It In ihtrnlDrv unloTMl "llinl uiwu i.'umiilBiiil uuulc... wlthiii 
lorty 1111711 Brtnr uiy sadi pankcni or p4inuiii> rninlUB. on lu tn nrlU" n* aformkUI. 
ill 4Ui; luueiiiuiil mirlvr tlie ymvrl)' vgJoi^ uf Un puiiiidH . ...it ulinll tie laithil iar 

luiy iTFo ]nii(i*PB tl Uip Ci-itcu tci mtiirivii ami tnavrf mic-h jwrnon tit fx-rwtiiii 

to nacli jiorjali irlicrv lira i)r tli^y were laiil 1p|nJljr cc^lloii'' Btntvml HCt* IKVpwt- 
iiijl \\> *"\\ti.\ \i» linnbuow bnd bwi p«Mod Iwfcrr Adam Siii[tb'» Uuv; but tbo; 
liwl tvpii iiiciTt'ctii'*. Ill lTfl5 Iiowner It wu oideml Uui no one iihoalil 
ir>nii>\i.it until lir bLfntnE oiMnaUj' diarsMiMi). 

> Suiui' iiitwrtMtQiu Kiuorki on tliia ntilMt u« made hy Bden, HUXor^ c/ 



AW 

1 



THK BBOIXKlNa OF THE NIMETEZNTH CENTUHY. 



£81 



in the direction ot making it unduly early. The sufferings 
of th»! working claxHi'H cauHud by a surieH of faiuiube aiid by 
the French War made some mcasitrc of relief necessary; and 
the need of large b<»dieK of rccniits for the araiy atid iiavy 
was an atlditional inducement to tender-hearted people to 
b« somewhat llbuml in their allowanceu tu a large iamtiy, with 
the practical effect of uialtiug the father of many children 
oHeo able to procure more indulgencPH for himnelf without 
working than he could have got by hard work if he had 
been uatnoiried or had utdy a srnatl farnily. Those wliu 
availed themselres moeC of this bounty were naturally the 
laziest and meanest of the people, those with least sclf- 
re(q)ect and enterpriiie. So although there wan in the 
inaDiifaicturiDg towns a fearful mortality, particularly of 
infants, the (luaotity of the people increased font; but its 
quality deteriorated till tli« puBsiug of the New Poor Law in 
183*. Since that time the rapid gmwth of the town popu- 
latiou has, an we shall see in the nuxt chapter, t^indt-d tu 
increase mortality, hut this has been counteracted by the 
growth of tempcrauee, of medical knowledge, of ^anilation 
and of general cleanlinees. Emigration ha» increaaed, the 
age of marriage has been slightly raised and a somewhat lees 
proportion of the whole population are married; but. on the 
other hand the ratio of births to a marringc has risen '; with 
the result that population has been growing very nearly 
steadily'. Let us examine the eouise of recent clmngcs a 
little tnorc closely. 



HOOK n. 
cm. IV. 



Siiwc ilia 

ri'Ionii ot 
iiLD poorlair 
lite sromli 

Uuu uu 
1>mn hirlj 



1 But lUi faunAoe iu tfao figpofM fbomi i* patUjr da< to iinpiwed Tegintimtioii 
tl tiiUm. (Fkrr, )'■<•; Siatitcic*. |>. 9T.) 

> TIw foOoviug tmldea flhmr tlin crowUt nf the pajraktiim at EngknJ uiri 
Walr* fmiD the bogtiutttig at laiit cviiLurj'. Tlie OgoKa foi tbe Uat ccutni? *n 
Gonputcd itout Um ngMcn ul birtlu and ilealli*. aud Uie poll uul Loarih Ux 
tnm: Uww tlne» 180t rrom Cauins retuniii. It wiU l» nnlliiHl Uml tlia nimi- 
n iKenaaaJ ■• imeb In the twen^ yt^ra lct\cmug llfa as lu Uie )ir«<««dliii[ 

Joiu->. Tbv pmumrc of Uiti ktviA wnr uiil Hu- IiikIi jirii^u <if i-iini U ■Iiohii in tbo 
•low |[TUwUi bvtwcvn 1790 and liM>l ; nod tho effect* uf itulUcnmuutv jfeor Imir 
■Uowuicra, bi apiU- ot xivaler |imHure. Li iihuwu by ihc r»|ilil iiiCTfraM Lu Lbe nut 
tm TW*. smt Urn utiU gttax^f tncreMO wLon Ihat pr«(irairv nu noiioirpd in Ui« 
doraila roiHng ttUl. TiM UUfil Mlnnm ahowv tUe peruMiUKe nhlcOi tlm inoMM 
donns tiM jtcceBdit^ daeada ««• of Uu papolBtiiui mL \Le l)i^uuiiu(C at tlul 



2^8 



THE SUPPLY OF LABOUB. TUE OROWTH OB SVUBEBS. 



niwK n: § 8. Early in this century when wo^s were low 

' '"' '" ' whoQt wfts dear, the working classes generally spent more 

In tiic thiiii half their iiicume on bruad : and comiwiuently a rise in 

ofUmciMi- the ])niL'L' of wheat (limiTiisnetl mamages very miicn among 

iHBrrin^i- them : that is, it diminished very much the uuiuher of 

wi'iT/iTi""'^ marriages by banns. But it raised the income of many 

Kuwhi.--. members of the well-to-do classes, and therefore often in- 

btrrati. creascd the number uf marriages by liceuae'. Siuce however 

these were but a sma\l part of the whole, the net effect 

was to lower the mttrria.ge ratu'. But as time went on, 



Populstlon 


Inirmw 


Year 


OOM amittud 


pdroinf- 




&.47& 




1801 


ft.940 


-4-fr 


tl 


hZfii 


&-2 


31 


fr,7ge 


i-1 


»1 


e,oM 


*•« 


41 


i.m 


»-6 


&L 


6,788 


*-I 


61 


T.428 


lO'S 


11 


T.U&3 


71 


ei 


a,G7f. 


9-1 





l^lptibtlon 


Inctmw 


IK>U*«IDltl«d 


pCTMnt, 


8.MU 


2-5 


10.164 


14-3 


13,000 


1»1 


18,997 


1&-S 


IS.909 


14-S 


n.W8 


U-7 


W.M6 


U-9 


ajn 


IS^ 


2C.9T4 


IM 



1 
I 



The KTMl Hruvrtli at eiiilfrratliuj •liirtuic raceul j'Mra luakis it importnat to 
Morrwt the fi{[ni«i fttr tlip lut thr('« >1«^»i1ch ho an Ut tliow th» "natarklbicr 

vii. Uint iIuB 111 Uiii isxi'uiw if liirlba iivu- il>»Uiii. 



DivihIp 111 nil hi in uhl nimii Kiliiual Hcnwtan- 
tntlinR bJrlbraritiwr dviithni<i> ptrr nusl imliir*! 
lofW iiiuD liKTFDimi tier 

tbaumiid 



avpncp ali- 

ni»l artiul 

Itm-inoil (ler 

IbMiouiu 

18-19 

14'S8 



I ton in (hou- 
Mtid* 



laa. 

7St, 

let, 



isei M-lfi W-2S l*J-lil 

71 ai-2* WM iaf.8 

ill Hi-SS -Jl'-iT l.VO!l 

Tb« Uxt toliinin I* olitninml b; compiu-Lut; tlic cciMni rvtivna with Uiobo ij^ 

hirllis Mid ilcmlliHi lur ihurv in uv tiii1i:ip<iiiili;iil riH'unl ot llie iiel niut^»li«ii Irotn 

Etiulaiiil Biiil Wnle". The (ollnvrins flgnriis niinw llw btow nmlsraUoti (Wtw 

oiuiltud) fruEii Uii' UiiilMl Kittcdoiii lit tlie decMmi aii'iliiit; witli tliu Iicgiuniug 

BRiifralioii di-nip ooiiptilon 



I 



divailn 
Willi I IK 
IH31 
41 

61 




Olid Ins 
M7. iJHiil S.S8T 

THS, is;i 1.967 

l,S85, leei 3.23H 

Tlir Uf^t i-iiiiiCTfition friVJi tile VixiUtl luuitdom duinR the lut of tbeiR duoJu 

WMl.4niMll)ll. 

■ Svr Dr I^^un-'a I7tb Annunl R«'|>ort Itir ItlM M RaKiKlMr-GwiiMal or tfap 
■ biitwE iif It In IVmJ StatHiif* [pjv 7S— S). 

* Per iiitluiic' rrpmwiiting tbe ifriirp mf irliotit tii iiliilllti^ MmI Uii> iiuinbrr «f 
iuiU'riii;:«A in EukIuikI (*u^ Wal«e in Uioudiutik. vr tmrc tit IMl «h«»t at till wnl 
nmniai^ra itl llT. (nr IhilU nhrst at bU luiirriiiKeo nt i^. ft)r ISOft lliH muubi-n mv 
•X^ atiil 80. lur 180T Oiey uri.' 'i luiil 84. lol'J tJicj arc VX t^A itS, for IHlfi ) 
6<t Knil liM), for IHIT tbojr un^ 97 and rS. tor ISOi tlii?; are U uulW. 



BBCEAT CHANOES IK THE PorULATIOV OP ENOUHP. 



2391 



hsat fell and w&ges roae till now the working 
lA on the avorago leas than a igtiart^r of th(>ir 
acomes on bread; and in oonse^iuence the variations of 
c«mni(«rcial prosperity have got to exereiee a propondcratiDg 
influence on the marTiagc> rate'. 

Since 1873 though tho avtra^ real incotao of tho 
pnpulatiiin of England has imli^nf] h{>cn tncri?aRing, its rate 
of incr«nsG has been \ess than lu the precediug years and 
[■meanwhile theru has been a cuntinuons l&ll uf jmL-eii, and 
cousequently a conliuuoiu fall iu tho muucy-introuiott of 
many ctaaoea of society. Now people arp governed in their 
calculalions as to whether they can oAbrd to marry or uot, 
Qore by the money iucoine which they expect to be able 
to get, than by elaborate calculations of changes in its 
piirchatiing powar. And thcrcfuri; the islaudanl of living 
among the working classes has been rising rapidly, perhaps 
more rapidly than at any other time in Knglir«h history: 
their household cxpeuditure iut,-a8iirt;d in immey has re- 
DMUied about stotiouory, and iut»uured in goada hu» iucrcoAC-d 
very &at. The English maniage-rate has fallen from !J'8 per 
KWO in 1873, to 71 in 1SS6; the- loweat rate that has 
owmrred since civil registratiou began. 

Meanwhile the price of wheat haa also fallen very much, 

Itod a marked fall in the marriage-rate for the whole country 

'has often accompanied a marked fall in the price of wheat. 

The statiatics even aeem to sniggcftt that this is not a merely 

casual coincidence ; but that the price of bread is now so low 

that a further fall in itft price does not pcrco]>tih)y ntlect the 

[marriage rate among tho population at larg^; and thai ite 

linfluenoe in checking marriages among the agricultural 



POOR n. 
ca. V. 

iMeroB 
llict influ- 
nice of 
cuminofciftl 
llnctna- 

<liMmtnl»d. 



Tb«i 
of wt 
■III) tlie 

Uirr. 



I Siniw 18'jO Um Bvenige prico of w)i<«l liiu huIiIiuii vxccmIhiI SOi. uuI iicvtr 

I T^.t sixlUuiinvvpfuivoLnfliitlnnt a( nantni(>rc# irlilrl) cnln{n4t«il *.ni\ Krcliein 1^J6, 

I tJM — 9. 1SI8. l^MS, IIWS and Itm n<?ivii>«I bq inflMiic* on ilto ninrririKf-nt* 

' abml opal with chBBKM iu l]i» prka of earn, Xfhrn the Ciro c»tUH-a act («|{olW 

UiitffKUftrrrrTTHlriklntc: tbw betwMU IHSl snil 1S34. thn« wat > recuTn; Hi 

Iire»|Kvil]r KcomtwiiH] bj k «tendf fall in Uie iirieo at wlmt uid miirrtaBM n«a 

fnrn * linnilnd and Ima to a hnndr»il anil ttr«nt; one UioimttruL Th« mniria^t- 

nU n>« afiBin rkptdlj bdtwMn ISO ■ml \<Ui vhcn tlia |«icc of irlml vwt m 

litlle linrta' Uiau hi Uw iitwcdinx jtnn, kihI Ibv 1rii<lii««a of tlio cutitittj itas 

RtfrliiK: and attain mulDr rinulitr drcmniitsiicGa bvtiiccii IM' ami iSii and 

■wdrMOi IMS and l»i. 



21U 



THE StrPPl,y OP LABOUR. THE BBOWTH OF XUMBEBS. 



noox rv, 
CH. rv. 



tiratlauit 



beUiid. 



luUrran- 
liiiiiiil »ia- 



gdom: 



populatiou and those directlj dependent on the 
ficient to lower the average marriage-rate tor the kingdom: 
but a longer timo roust elap«u;. and more coiucidenees 
be noticed, bet'on: the result coji bu rugtudud oh 
csUihlisliud'. 

§ 9. There is much to be Icanit from the Mstorj* of 
population iu Scotland and in Iretand. In the lowlands 
of Scotland a high i^tandurd of cdut-ution, the development 
of mineral resources, and close contact with their richer 
English neighbours have combined to afford a great ircren 
of average income to a rapidly increasing popuiatioii. 
the other hand the inordinate growth of population 
Ireland bofore the potato- famine in 1847, and its Rtcodj 
diminution since that tiuie will remain for ever laiidmarli 
in economic history. 

But we miiHt clone thut |)art of our imjuiiy with a rapid 
gtauco atr other countries of ilio civilized world. Comj«mng 
thu habit» of ilifferent nationH with the aid of the iidjoiuiiig 
tables, we find that in the Teutonic countries of Central 
and Northern Europe, the age of marriage ia kept late, 
partly ill coijseijuence of the early years of manhootl being 
spent in the anuy; but that it has been very early iu Rtusia 
vchere, a,t al! events under the old regime, the family group 
itiHlstinl on the tton'o bringing a wifu to help in the work wf^ 
the household as early as possible, even if he had to loav^H 
her for a time and go to earn his living eUvwhtre. In the 
United Kingdom and America there is no compulsoiy service, 
and noeu marry early. In France, contrary to general opinion, 
early mfuriage^ on the part of men are not rare; while on the 
ptai of womeu they arc more common than in any countij^_ 



t 8w*<1(in hu \tmg I<m>ii noted for Ute eualloncc oS iU vIImI ■tkliatioi. A e«ni- 
pariiian at Ihf )uani6|^■ ntu with Uie IwrTMfal in Sncdim fnr ibi; jr%n t'lS IB 
la6i U pireu liy Sur lUniifii Itawmn In the SUuUfira! JintnuiJ fur Dwi'iiilwr 1N& 
Of coanv III* liM-vral ilora uuL doclarB itnelf liU purl .i( Uw jmr ■ u1« nf iiuutui£» 
to nindi' n]>; jui we tnont lonk at Uii> bArt-rkt uf l>i« rear pri«t«1iiie u veil m liir 
jreir of nn; piirti.dilM niArrtAK^ tmti^. P»rilf for tiii* roMMi tmA ■pa.rO.f tti»MM 
tha liiai|ti*llticit of hnrvcrta uv Ii> iii>m>? ntcul »jiii|)«nHt(«1 (ut ttj tiiv ihwag* 
ol gttiu Uiaim liarviwl Hcuiw dii not them a cloac c(arof|><iodaiov wUb ikt 
Buvrimo nt«. But n-luu •crcrml cool, ur wvural Iml lorrMia ootuB tetnefiimr. 
Dm eSecl Ui iucRaoUii; ur ilimuiiiiluiig tbo mMrrtasp-ratc la vwr drarl; taatkaL 



WrmKATIOMAt POPVLATION BTATISTICS. 



241 



whicl) we have Ktatislic^, except the Sclavoitic countries imokiv. 
(among which wc may reckon Hungary) where thoj are much ^ ^' " ' 
the highcBt. 

The marriage-rate is generally highest where the number 
of early marriogce in the greatest; and so also is the fecundity 
of muriages. But there are some striking exceptions. Thus 
the number of children to a marriage is exceptionally low 
in Franco, and even lower in Massachusetts, though the age 
of marriage is not particularly high in either of those 
countries; and it is not very low in Sweden, where very few 
wumeu marry under twenty. 

Tho gouoral uiurtaiity ia high where the birth-rate is 
high. For instance both aro high in Ruswa and Hungary; 
Qth aro low in Sweden, France and Massachusotta 

lu Frauce mtd iii MafiKachusetLs the "natural" increase is 
veij gnaall ; but there is an excess of ituinigration over 
einigratiuD, which raisi-s the actual rale of increase. In all 
other countries of Europe except Franco, Saxuuy and Austria 
proper, cmigratioD exceeds iraniigmlion : the natural rate of 
3creaM> is greater than the actual. 

India differs from Ruraia in the same way thai Russia 

■ from th(! rest uf Eiirop^ iu having earlier marriages, a 
jher birth-rate and a higher death-rate. But the death- 
\te is more nearly djual to the birth-rate iii India than in 
UuK-ia. 

It ia a remarkable fact that the marriage-rate, the birth- 
"iBtf. and the death-ratt; ore diminishing in nearly even- 
cvuutry of Europe. But the birth-rate in tho large popula- 
of Kutviia ia increaAing rather fast, with thu result that 
'tht average birth-rate for the whole of Europe m scarcely 
diminishing at all, though the average marriage-rutu and 
death-rate for aU Europe are diminishing rather fast. The 
" natural '' rate of increase in on the average slightly increas- 
ing in Eaglacid and Seotlaud (but not in Ireland) and in 
luoet other parte of Europe, and especially in those inhabited 
by Slavonic jweplea '. 



■ Tba "nitsnl" kiuiual Ihcrsm for Karuiw tor Uw yoftn IMS— TO vu »t 
inUc/'il iMtrccnl.. uidfar Uiejuua 1679— ^ U Uic rale uf 1 16 iwrceul. 



Oonntries. 



Uotial' 
Ceunu. 
OOjUOO'* 
MnlltMl, 



Europe » 

KuglajidA WklfM.. 

Sootland 

Inland 

Swodttt) 

HoUiuid... 

Bol|piun..„ .,. 

FnDOft 

Pmuia 

Saxony 

Baviu'ui 

SmtzerUad 

AoHtriA Proper 

HuLgAIJ 

Spain 

Italy 

BuNna, (Euiwpenii) 
Uuitod Btatee ... 
Iff nnfwffhiiin^ f h , . . 



lul Hi 



319,6 

S8,0 

3,7 

*,a 

4,e 
4,0 
bfi 
S7,4 
27,3 
»,0 
6,3 

22,: 

1»,7 
16,6 
28,5 
62,0 
&0,S 
1.8 



per laa 

linnd- 



iUkhB,p«r- 

Drilor 
tiyvan. 



*3- 

■81- 
-72- 
-48- 

•ea + 

■80- 
■7S- 
■78- 
■86- 
■M- 
■85- 
•74- 
■84- 

i-oa- 

•73 
•77 + 
■04- 

■D4- 



pttnmtdcc 
iif, tuida* 



3fi-3 
£1-3 
42-3 
33« 
S3 -3 
S6^ 
SS« 
S7-0 

347 

se*& 

317 

38 ^4 

se-0 

68-5 
400 



240 
14-4 
13-4 

n& 

B'6 

6-4 
21-a 

10^3 
10-7 

e-4 

8-8 
IS^l 
36-q 

ie-9 

&8-0 
18-9 



Birtlu 

«T 1(K) 

linHB- 



3-8T- 
3-51- 
3-47- 
i-U- 
3-OS- 
3S9- 
3-I&- 
2-&i- 

4-24- 
3^»54- 
3^08- 
S-S4-t- 
4-30+ 
339- 
S-«8- 
4-94 + 

S-67- 



ItinhB 

nmulmr 

tv a 



4-7 
4^3 
4-6 
&-S 
4-8 
4-fl 
4-4 
3-3 
4-0 
4-6 
i'J 
4-1 
1^ 
4-8 
4-0 
4-8 
63 

4^7 



HirtlK 

tnatr. |Nir- 

lotlO. 



6^4 

,'■•3 

104 



I 



7-& 






4-0 

lS-4 

7* 

M 



Tb« sl^i -t- mi - Id oolnmn % fiiibmt*! Uutt tbo o«>iT«qi«niliii|t fijinr^ii for Uie U«l Br^ yeaia 
of Uie iiMriwI wpre rwiNcliiclj ip«*ter or kaa Uuur Uumc fcir tlw dm flru jmk (4 Ui* jtarioj 
18B6 — u8Si Uut is timt the mairugO'nta wu 1— "T'lg to fatemuM or to ^ImiiMi ; ud atiBilulj^ 
fM ealmna* fi aad 8. Ot eonrM tli«« u^ ooMiIaul imgslaritiiML Tha* in Hongkry tlx- 4l«atl»-i 
ntc wu cuMMivvhr liii;li 1" it><> ibUiUb xf the pcHod : uiil «ra euiiuit Uerrfore mj nciu^v bIuI 
bi ika.' KlfDUMMM ol Uie bet tkal tlw dntb-rateitu abltju liiitlMr At ihclKwiuniiie Ibou al llic tml 
of lfa> pniod. -n* figuna for Kiini|w 49 not indnda IboMt for Tbrkfj-j Uit Uwi/ 4o iutludv IboMJ 
to nnuHid •wl Pi>lai>d, tbuiuli tbB He*'*'* (>' (Iimb evuiitrint urs kF|it wfUMtii from USumi foB 
Biali. T1i> ftcvnv for JiAk-A matt be rMxIrnl wltlt outlioai: Uio nvmlMa ot aturi»gm <a 
cxrbunl;' nnili-ntali^. I; r' titrlliH up miii]<ArMl witfa Uut nuuTU|,-«a in thr nam yoat 

bni »» Vur ban ari[HMl, 'i><, |i. '.i?, Uiey kboaU properly Im isiin]iuv] ntUi tlii- bu 

rtajtn lU jrooni iwrliu'. .•^-■■j m ui'Ji-r tinjfU'rty to lutVMre Ibe Icemiility at ualtMigea 
nUiilliMta liirtlu (oolutnn T) ttimU k« flxfnclad frgm ttu lots] iHuutMr Won iUTUliig 
111* tpuM IB oolntin b annd» tlillbeni cbOdrai, «XMpl for llw Cnitad Kfaiidim. 





H^^PS FOR THE YEARS I8Q5 TU L883 (WITQ J. FEW SXCEPTliUlS} 


^ 


1 




B 


9 


10 


11 

Auiiunl 


12 ' 13 


■ 








Dcatha 


Bsikths 


etetma of 


Animal at^tnnl tu- 


^^M 






DaalLa 


liitrcniilsKn 


{Ntnciiitxcii 


birUwiiTirr 


u-lnal 1 cniiun iwr 


^^1 




Conulnea. 


par 100 

llrtag. 


UU'lcY OlIB 


uiitlur Aur 


ilvattw. 


lltCTBaM 


out t. In 


^^1 






fttmi 


7«ani ol 


p«w*'nlii(i'' 


nir nnnt. 
ill mx-iiL 


«nrlln 


^^1 








»«*. 


•«•■ 


tu wbrjle 


jtitmof 


^^1 












poputatini). 


jvatm. 


lliia cui- 


^^H 
















tUTJ. 


^H 






S-81- 


211 


32-3 


1-06 






V 




KugloJid & W&len.. 


214- 


14-9 


2-1-9 


1-37 


1-32 


1-37 


1 






214- 

178+ 
1-89- 
2-«- 


IS-2 

13-2 
19-3 


23-1 
22-2 


1-33 
0-86 
I 13 
113 


1-02 
•6ft 
77 

1-02 


1-08 
■18 
■83 
71 


1 




Swedao 


Holland „... 






2-24- 


14-8 


fia-3 


0-91 


-M 


77 


^1 


1 




2-88- 
2-65- 
2-flO^ 


16-9 
21-3 


2S-B 
32-4 


0-18 
1-23 
1-34 


•2& 

149 


-49 
MS 
1-39 


1 


knadft 


c 




• 


3-06+ 


30-8 


39-3 


0-89 


■71 


■6S 


1 


f 




S-31- 
310- 


I«-3 
25-5 


24-fl 
39-0 


071 
074 


•82 
77 


■69 
■64 


1 


^AoatriA Proper 






3-83+ 






0-48 


■48 


■03 


^1 






2-01- 

291- 


210 


37-8 


0-48 
0-77 


•33 
-68 


•61 


1 


Italy 




Ruasio, [Guropeaa} 


3-B7- 


237 


43-3 


1-37 


1-29 


-84 


I 






— 


— 


— 


— 


S-36 


3-01 


■ 




UsMMuliuiwlbi 


1-98+ 


16-3 


87-9 


0^5 


1-87 


I ■SO 


I 




CcJinm 11 siTM Ika aafHraJ ral« uf bi«reaM; IE Is obtained br dnlnctiiie eolunui 


H 


S tram colnBii ik Th* Sutinlini fur F^ufi'. pxcrtil: iii tlia Ijut oulimi)] ■» tat Dm ^^^^H 
raw* l&TO— IBItt: iboM (or Ituiuin 1H6;-In7b. aui f.<i SwitnrUtid lOTO— IdeS. tn^^^H 


^^■1 otfaer ««W« tb» Itinttn am rrr; iii-arly IKi^.i anil lhiK>, f.ir oU cnlmiuu pSMtit the U4^^^^H 


^^^■rtiiiU^* id Uk uxcciu or Ovfvcl of tliv ciniKrilbu cimipiucil nitli Uic Uuiiiiin:*Liotii ^^| 


^^^■Mfit ill Uia nkim ■>( Fnuim aitd Iho tliiiUnl KlatiM (or li9ueb Ui« punulatlou* miw^^^^^^f 
tali«n Inr 418er«iil unin at Uw linHitiuiiiK and I'lul fd tli« poiiod. For all nuiur ooiuili1a^^^^^| 


tkmr MC oaknUUil lliruuxtiuBt coIuuuib IS aiul 13 tot liu anoa wbleb Uio G«aiitri«fl^^^^^| 


WlW<ii*clT ti»l in ISKl. I.\<liiiiii> I'i u lutawt Kfnvralljr ou Immtr jistn' fiitnrm liepn^^^^^^H 


iitaV alMnl tVfO. mill vulmuii li iiti tlw pr«c«(UiiK CUj'oan. TliH I'bielfVeiiiitiuFi ial!il*iua.^^^^H 
for wUdi UiE prriodn are IHUT— -7U. ami 1811— AT. The ImI tifo cdtimus btd tiikun dtrcd ^^^^H 
tram iSigour BaHn't Jfortn<nla >lrl ^lal« OiriU, Oan/mnli /iitfnittiattaii, VSM: Um rwat^^^^H 

ai« Ufceu froan tbo tablM, haM«l nn Slgnor Bnlin i work ffbldl mn* jmhUahed bf ^^^^H 


air BnnoD Bawaou id Um BKUutteal Joanml (or 1S65. ^^^^| 


^ ^^^^^^^^^i^^^^^B 



244 THE SUPPLY OF LABOUR. THE OROWTH OF NUMBEHS. 

BOOK n. The " actual " annual increase during the present gene- 
*^'"' ration has been greater than in the two preceding gene- 
rations for most countries of Europe, but not for Great 
Brittun, nor for France and Spain : and not for the United 
States*. 

^ Sm coltinuu 18 kdA IB of the preceding Table. 



CHAPTER V. 

THE aUPPLT OF tABOUB. COSTINUEa HEALTH AND 
STBENOTH. 



§ I. We have Doxt to coasidor the conditioiie ou which 
id health Rill] Nliviigth, physical, m«nta1 aiiil moml. 
^'tej are the basis of indugtrial officioucy, oil which the 
prodactiou of matyrial wealth depends; while eouvensely the 
chief iruportanco of material wealth Iie« in the fact that, 
when wisely used, it iiicrcaues the health aud tttrength, 
liysical, int-ntal aud moral uf the human race. 

In many occiipationn industrial efficiency requireH littli.' 
line thao physical vigour; that is, muscular ntrength, a gixxl 
coDstitution and energetic habitn. In e.<<tiinating muscular, 
or indeed auy other kiud of streDgth for industrial purpOHeB, 
wo miiflt take account of the minibiT of hoiira in the day, 
of the uumber of days in the year, and the number of years 
in the lifetime, during which it can be exerted. But with 
this preoiubiou we can measure a man's muscular exertion 
bjf the mimbcir of fcot through which his wnrk would raise a 
pouml weighs if it were applied directly to this uae; or in 
other wordb by bhu number of "foot pounds" of work thut 

does'. 



BOOK IV. 
CIL V. 

HbuIUi SUiI 
wu tlix 

IimIm vt 

piutlnctir* 

work. 






riui Iw 
lucknoml 
III laol 

jHIUlllIt of 

nurk. 



I > Ttala mwimre eao I10 apjitleil dlnctly to iuu«l klTidu of usvviM* nml poiWnf 
anA ivdireelljr to ntuiT Uiidn nl aKrlcultural wnrk. In a toDixirtany 

■«■ wajcvd ft/l«r 111" KniAl' i^i'iilliintl liH-k-uiit na U> III* inUlivu ■IUvSmivj 
! iiiiililtlfil Iklxiitr ia Utc SonUt luid MurlL of EnKlnnd, the iqorI tmrtwci^ji 
OMamMi aiu fuuuil iu iba niunber ut Iuiib »F moUrrial tliBt a mail wu'ulil luad iuln 
» ^at in ■ lUj. OUicr lutajrtiui have bom (nimil m tlir nambrr of icrr* rraiical 
«r movu, «r tlw nnmbM oT Inululii of ouni n«]incl Ac. : twi tiieaa are nuaatiilaC' 



24C 



THE m'PPLT OF LABOUR. BEALTU ASD STUEN'GTU. 



nooK TV. 
en. T. 



But it 

/ItipmAa oil 

iiorvuUH Kii 

DiuHCulAr 



In backward countries, particularly wht?ro there is nf 
much use of horses or othor draught animals, & great part of 
men's and women's work may be measured fairly well by the 
muscular exertion involved io it. But in England less than 
onp-sixth of the induslria.] claHseB are now engaged on work 
of this kind ; while the force exerted by steam-engines alone 
is more than Lvi'euty times n& much as could be done by the 
muscles of all Englishmen. 

Although the power of sustaining great muscular exertioii 
seems to rest on constitutional strength and other phymcal 
conditions, yet vwn it depends also on force of will, and 
strength of character. In the war of 1870 the Berlin 
University Corps, which seemed to be weaker than the 
BTcrage. was found to be able to bear more fetigiie than 
almost any other corps*. Energy of this kind may perhaps 
be regarded as the strength of the man, as disdnguiabed 
from that of hia body, is moral mther than physical ; but 
yet it depends on the physical condition of nervous 
strength. This must be distinguished from Qer^'ousueai, 
which, as a rule, indicatica a general deficiency of nervous 
strength; though somotimus it prucueda from nervous irri- 
tability or ^vant of balance. A man who ban great nervoos 
strength iu some directions may have but little in othere; 
the artistic temperament in particular often developes on* 
Ktt of nerves at the expense of others : but it is the weakness 
of Bome' of the nerves, not the strength of the others that 
leads to nervousncsa The most perfect artistic natures 
seem not to have been nervous: Leonardo da Vinci and 
Shakespeare for example. This strength of the man himself, 
this resolution, energy and solf-raast^ry, or in short this 
" vigour," rests on the physical batuB of nervons strength 
and is the source of all progress: it shows itself iu great 

tory, putlcoUil; toi craii|i«1iig diffrrcnl condiUoiui of OKriculturc: olnm titt 
uniikineulii UimiI, Uih iinCure uf tli«< truii aiiil iLnt iMide of AaUtg \\ie wurk all imfT 
vldtly. Thiti iifuu'ly nil ('(imiinrifoiiK hutVM'ii mffllim-Kl nod moilani tcMk and 
n^-oi biuAl on tLo wagi'i of ivapiiig, mowing iie. are vnlnvlfn nDLil we iiat« 
liiulid DUHUiN In kllow (iir Un- cHi^Rtii •>( r-liniiituB ill Itiii itintliiilH i>f Kjinrullur*. ll 
ouats tor inntiLni'v Leon Inboiir tbaii it did lo reap l>; luuiil a crop tliAt jJoMi ft 
Luiiilrcil LuHliela uf i'<irui bvcauHt' tilt' uii]>lviiuiila ubl-cI arolicUcr tLati tbey vcn): 
lillt ll. may iinl m»t I"" Inlxnir In rtuip an icrn of cnni ; liortaiua Ulv CtC^ U* 
ln-aiicr tluui llii'y nvtr. 





capacity 

Vigour works itself out in so many forms, that no simple 
tneu-tun- of it is poKsibk-. But WB are all of ua couatantly 
estimating vigour, and thinking of one person as, having more 
backbone," more "stutF in him," or as being "a strouger 
man " than another. Business men e%en in different trades, 
iLnd University men even when engaged m differeuC etudies 
get to estimate one another's strength very closely. It soon 
becomes known if less strongth in required to get a "first 
" in one study than another, 

§ 2. In di»cnssing the gntwth of numbcni a little ba£ 
en said incidentally of the causes which dotenuine length 
life : but they ore iu the maiQ tbc luune as those which 
determine constitutioiml fltreuf^h and vigour, and they will 
occupy our attention og&in in the preaont chapter. 

The first of these causes is the climate. In warm 
countries wc find ewly marriages and high birth-rates, 
and m coDseqtieuce a low respect for human life : this has 
probably beeu the cause of a great part of the high 
mortality that is g<?nerallj attribiit«il to the inHalubrity 
of the climate. In England popular opinion has insisted 
that a "warm Yule-tide makes a fat churchyard;" but 
statistics prove beyond question that it has the opposite 
•Ifect: the average mortality is highest in the coldest 
quarter of the year, and higher in cold winters than in 
warm'. But in warm climates the autumn is generally the 
most unhealthy part of the year. In India moisture is more 
hurtful to health and stT«ngth than either heat or cold: 
hile the dry cold of C'ulorado, Canada aud the Alps ia often 
baaaficiaJ to those who are well fed, clothed aud housed. 



vigour i:au* 
nal ho 
uieaiiiii«i1 
but cAii bo 



Phyricul 
hciilUi nnd 
loiieeTity. 







I A high lampermluiv innniMui tlii^ (Ivnllii fmm tini'h fUknuno lU Uioca nt tiie 
UrtM umI tlte alimeDtuj vtiial. h\il iii Erit-lnuil it (IfiiiiiilUmi to a ^Tvalor L-ileiit 
Iha ifaallw trum dUeawm i»f Ilw Iniigi nnil otA iik«. t^no ui Hrticln by [>r finy. 
Ok TVjMptnitKr^ mnJ iit rrlation to norfitlili/, flati'ltfiU Jcuruaf, Jun«. 1^1, kIho 
Fmn, Titot Btatinia, pp> 119, &«.} Ttw tmxc <i popuLti oj^wi oa tlus laL-jwi 
InatmUa ncD tlw nnlnHtirorthhuaH of lImh itMicnJ ItDpnailani on irtilch mucb 
MI wutiMi hlMQfT ia bwcd, Vi>ls. ii. siiil m. uf the Ttalh C#n«u qf" the 
Wfurf Rlaif* cantam aomo iiiluriwtiiig invMligitlon on tUn iiiflnMiM of g«o> 
gnpliic*! eondlUMiB on vttal euuttics. 



248 



THE SUPPLY OF LABOUR. BEALTH AND STKENOTH. 



BOOS tV. 
CH. V. 



Bmo 

(lomtitiuii. 



Tbu ui.'coa- 

■nrioof 

lih. 



A warni climate impturs vigour. It is not aliogctbe 
hostile to high intellectual and artistic work : but it pre- 
veut6 people from being able to endure very hard exertioa^| 
of any kind for a long time. More ftust^ained hard work 
can be doue in the cooler half of the teiuperat*; zone thmi 
anywhere cists; and most of all m places such aii England 
and her counterpart New 2i-alai)d, where sca-bteeses keep 
the temperature nearly nniform. The summer heate and 
winter colds of many parts of Europe and America, whei(^| 
tb« mdan temperature is moderate have the effect of short- 
cuing the year for workiiig purposes by about two monthft 
Extreme and eust^ucd cold 15 found to dull the energies, 
portly perhaps it causes people to spend much of their time 
in cloee and confined quarters: inhabitants of the Arctic 
regions are generally incapable of long-oootinued severe 
exertion. fl 

Vigour dependit partly on race qimlities: but these, uo^ 
far as they can be explained at all, scorn to be chietiy due to 
cHmate. Race history is a fascinating but disap]H>intitig 
study for the econumist: for conquering races generally in- 
corporated the women of the conqiiertsd; they oftt?n carried 
with them many slaves of both flexes during their migrations, 
and slaves weri< less likely than fruenieu to 'Ik> killed iu battle 
or to adopt a ]nona.stic life. In conseijuenco nearly every 
race had much servile, that is mixed blood in it: aud as ths 
share of servile bEond was largest in the industrial classes, 
a raee history of industrial htiblls aeeins iinpoSiSible. ^_ 

§ 3. Climate ha.s alxo a larg^i -share in determining tli^| 
necessaries of life; the fii-st of which is food. It must 
supply the nitrogenous and other elements that are 
quired to build up growing tissues and to repair the 
of the body. It munt al»o afford heat. Home of which 
be converted into muscular force ; and for this purpose car^ 
bonaccous food, whi^n it can be propi^rly digvatud is the 
cheapest'. Much also depends on the proper preparation 



:h ajM 



> Tbe nltrnKenans deraeiilt Km irottL ckul? got rrom wifin*! food. Tbor eiM 
■Im In ToiirUlili' fcHitit : lint not in a tanii tLat i* bo ea^f iUg«at«(l and iMiind- 
UWd. TlM •api>lf ol it k III4WC Bbntidiuit In httun; jioM, ItolUit ifco., niiil lo * luM 
«slaBt in MMali ; bat In thaM ft is (cnnd chf efly In Itaa aawr pMa of tb* fisio. 



rOOD AKD OTHES MATERIAL NECESSARIES. 



249 



1. and a nkilled liousevrife with L^ii shillings a week noos n. 
Mid tin food will often do more fi>r the health and ' 
Btreugth of her family thau au unskilled one with tweuty. 
The great infant mortality among the poor is largely diie 
Lo the want of care and judjjutiai lu preparing their food ; 
and those who do not entirely eucciimb to thia want of 
motherly can.* often grow up with cnfueLIeil constitutions. 
1q all ages of the world exct^pt the prcstiat, want of Rdtrdt; 
food Kaa caused wholesale desbructiou of the people. Even cnuea 
in London in the ituvcnlt-uobh and eighteenth centuries """ "' 
the mortality was eight pur cent, greater in years of dear 
com than iu yeare of cheap com'. But gradually the 
efiecte of iDcrea«ed wealth and improved means of com- 
muuicatioQ arc luoklag themselves felt nearly all over the 
world; tbo eicverity of taniinc£ is mitigated even in such 
a country as India; and they are unknown in Europe and 
in the Xew World. In England now want of food ia 
scarcely ever the direct came of death : but it in a frequent 
cause of that gonoral wtakening of the system which renders 
it UDable to reaist diflease ; and It is a chief cause of bdustrial 
lefficieucy. 

Wc have already Been that the neeessarics for efficiency 
~Tarj" with the uaturo of the work to be done, but we mast 
jw eiJimine this subject a. little more closely. 
Aa ri'gardfi muscular work in particular there ie a close ■»») 
connection between the .'*iipply of food that a man has, and Jf.IlI^j'nJ^ 
his available slreagth. If the work is intermittcMit, as that*'*"'"- 
of a dock labourer, a cheap but uutritious grain dtct is 
sufficient. But fur very heavy (!ontinuou.>i Ktrains mtch at) 
are involved in puddlers' and the bartlest navvies' work, food 
ia reijutred which can be digested and asslniilatL-d even when 
body is tired. This (|uality ia still more essential ia 
Ibod of the higher grades of labour which involve 
L.-d nervous strain, though the (juautiLy recjulred ia 
gen^Blly small 

vhldi an fmBnm'I ki wbolraiML floar. hnt tm tlinmti nnKjirliPn nltitu floor ii 
nada. Tcfettkle food Koiatmlty. but Miwrlally Uie cerwalH. uid iwuiiwa ct*9 
itamdaai upplioD id Hit (vlM>Dae«oiu or itUnti ulemButH. 

t Tliia «u fiMTcd by Vmt who ritniiMeA diatnrblng mukoh by on imtnctfv* 
Ikirtwl ink» i nwf Aarwf.'M. p. 180). 



250 



THE SUPPLY Of LAtKJUR. HEALTH AND STttENGTH. 



BOOK IT. 

on. V. 

Clotbicu, 
boase-rcHnii 
ami firing. 



t 



RmI. 



RMW. hoe- 
doni aiiil 



tt»— 



Aft«r fofifl, the next nccuvsoriua of life and labour, 
cluthiiig, bousL- room and firing. When they aje deficient^ 
the mind beconinH torj^id, and ultiniati:ly the physical OM- 
stitiition is undrrmiiied. When clothing is very scanty H 
isgeupmlly wuru night atid day; ajid the skin is allowed to 
be enclosed in a cniKt of dirt. A deficiency of hoiiisc-raom. 
or of fuel causes people to live in a, vitiated atTnosphere 
which is injurious tu health and viguurj and not the least of 
the benefits which Gn>;Iish people derive from the cheapness 
of coal, is the habit, peculiar to them, of having well- 
ventilated rooms even in cold weather. Badly-built bouse« 
yrith imperfect drainage cause diseases which even in th«ir 
slighter forms weaken vitality in a wonderful way; and 
overcrowding leads to naoral evils which diTniiiish 
numbatf! and lower the character of the people. 

Rest is as essential for the growth of a vigorous popu 
lation as the more malarial iieeeaBarifs of fowl, clothing, &c 
Overwork of ev<>ry fonn lowers vitality, but anitiety, werrj*. 
and exceftsive mental Rtmin havo n fatal influence in under- 
mining the eoustitution, in impairing fecundity and diminish- 
lug the Wgoiir of the rate. 

§ 4<. Nest come three closely allied conditions of vigour, 
namely hopufulnoso, freedom, nud change. All hiatorj" is 
full of the rt^cord of Luefticiency caused in varying degTee-t 
by slavery, soridonij aiid other forms of civil and political 
oppremiou and repression. Free<lom and hi)pe increase not 
only man's williiigiiL-ss but also his power for work; physi- 
ologists tf*ll us th»t a given exertion consumes lais of the 
store of nervous energy if douo under the stimulus of 
pleasure than of pain : and without hope there is no 
enterprise-. Security of pmrsou and property are two 
conditions of this hopefulness and freedom; but security 
always involvt^s ra-^traintji on freedom, and it in one of the 
most didiciilt problems of civilisation to discover how to 
obtain the stwurity which is a condition of frewiora without 
too great a nacritice of freedom it.self. Changes of work, 
of scene, aud of ])en!oual asBociatioiis bring new thougbta. 
call attention to the imperfections of old methods, stimulate 
a " divine discoutrnt," and in every way develop creative 
energy. 





HOPE. FKEEDUK A»D COAXGE. 



251 



In all ages colonies have been apt to outstrip their 
mother couulrics in vi^ur oiitl energ)'. Thia has been due 
partly to the abundance of land and the cheapness of neccs- 
Mirios at their comniaud; portly to that natural selection of 
the strongest characters for a life of adventure, and partly to 
physiological causes connected with the mixture of races : 
but porhaps the most important cause of all is to be found 
in the hope, the freedom and the changefiilneBS of their 
lives. By converse with othern who eonie from different 
and have different customs, trnvellers loam to put 

its trial many a habit of thoujjht or action which other- 
they would hnvy always acipiiesci^d in as though it 
rere s law of nature. Mureover a shifting of places enables 
'the powerful and original minds to find full Kcope for their 
eDergies and to rise to important poKitions: whereas those 
who Btity at. home arc often over much kept in their places. 
Few men are prophets in their own laud ; u(?ighbour*i and 
relati(»us are generally the last to pardon the faults and to 
moognue the merits of those who aru less ducila sud more 
enterprising than those around them, ft is doubtless chiefly 
for this reason that in almost evf-ry part of England a dis- 
proportionately large share of the best energy and enterprise 
is to be found among those who were bom elsewhere^ 

But change may be carried to excess ; and when popu- 
iuu ahitls .so rapidly, that a niiui is alway.s shaking himself 
fi?om his reputation, he loses some of the best external 
Mds to the fonnution of a high moral character. The 
extreme hopefulness aud resttessneBs of those who wander 

new countries lead to much waHtc of effort in half ac- 
"quiriug technical skill, and half finishing taski^ whiuh are 
Jy abandoned in favour of some new occu}>ation. 

Freedom so far has been regarded as frceduin from 
external bonda But that higher freedom, which coraes of 
self-masteiy', is an even more importaut condition for the 
highest work. The elovatioa of the ideals of life on which 
this depends, is due on the one aide to political aud ccououiic 
waaea, and on tbc other to personal and religious inHucDCM; 



BUO& IV. 
tfll. r. 

C'llUlJl^Uul 

of tlia pms- 
l^trllj at 
ruluriin. 



Botctuniiv 

luajrlM tx> 



inoiit ol 
I'tiuoolet 

L-LiuAj' en 
Uic iiillci- 



1 Bagll'B ml^wtiTt) frM-dnin. Sup tbairn Bk. i. Ch. a. { 4. 



252 



THE SCPPLV OF LABOlfR. HEALTU A.VD STBESGTU. 



DOOR IV. 

Tb«i(ifln- 

miea of 
occapaUou. 



FacluTT 
mill Eila- 
catlon 
Aou. 



Xbc Inju- 
ria* cn«>d 
whan 

luuUiun uf 
jFuiui); viii]- 
drvn uurk 
amy fnni] 
braw- 



atnoiig which the intluetice of the mother in yaily childhc 
is 6iiprem«. 

g o. Bodily and menial health aud strength are much 
influenced by occnpation. Tlip rnto of mortality is kiw 
atnoQg minister uf religion aud schoulmBiilefS; atnotig the 
agri(7iiUural cloascs, and in some other industries euch as 
those of vrheL-lwri^Hts, shiinvrij^hlB and t-oal-niiners. It a 
high in lead and tin mining, in lile-mnking and ^arthenwai-e 
luaiiutucture. But neitber thi-ae uor any uthtT regnlar trade 
show as high a rate of mortality as is found among Ijondon 
general labourers and cuKtermongem ; whiltt the highest of 
all is that nf servants in inns. Such occupations are not 
directly injurious to health, but they attract those who are 
WKftk in physiunc and in character and thoy enconi 
irregiilar habits'. 

At the beginning of this century the conditions of 
tory work were needlessly uuhoalthy and oppressive for 
iknd especially for young children. But Factory and Edu- 
cation Acts have removed the worst of these evils frofn 
factories; though many nf them still linger about domestic 
industries aud the Kinallvr workshops. Intiuit mortality alsn 
is diminishing, though there remains much room for im> 
provi;meut in thit; diructioa. S 

The higher wages, the greater iatelUgeuce. aud th^* 
better medical facilities of towu^ptuplc should c&una infiuit 
mortality to be much lower among them than iu llie 
Muntrj'. But it is generally higher, especially where there 
are tactoricH. This arises from that survival of medijeval 
fallacies, to which we have already referred*, and which lead* 
some people to think and act as though the family income was 
iucrca^ud by all that thu mother earns wlien she goes out to 



rallP 



1 A ni-nA H<'roiinl iif (l<i> iiitlni'iii'ii of fH-r-iijiftilniT o'l i)i«tlr r*l«« t* ^veit (b tlw 
mpl^li^nuut lu llw fortj'-flftlb ^l)HS5) Aunun! Xi-pi^t of tUri t)«gutr^r. JuHrMi'. |I|il 
XSv. ti> lull. Htf ilUii Filrr'H Vital St-tlinlini, [i|i. .IDS — 4It, Mr Huili)>tilcj»' VftT 
on (.Uau Moitaliis fi<ntutKA Lu tliu SlatUlUal J^mrual for Jutic. l^i uiil the 
UhralUTD ur lite (V'torj A<^l« K^iKinll^r. 

1 g«it abuvo Bk. u. Cb. i«. Ittwchar {Political f:<Dmamit, 1 312) wj* Ihal Uie 
Jewbli iioiinLitUoii nf I'ruMin linn IncroaMid fuler tlian Uio CliriBtiau, UiiHith lla 
birlh-rato ha* txwu lower, tbu diid eaiim tmag thai Jmriali molliara uJdoa | 
ftwajr dam Uicar liouwa lo tmrk. 



THE IKFLUENCE 0¥ OCCUPATION. 



263 



'Ugb a little connideration would often tihow that the 
things she can buy witli her eiUTiings n.rp of far less im- 
portauce for the health and happiness of the faJDJly ihau the 
mere tnaU^rial aervicus she could hiLvt- remlcn^d thmn if she 
had stayed at home, to say nothing of her moml influeuce iu 
educating the children, in keeping the household in harmony 
aud making it poe^ble for her hiisbaod to be cheered and 
soothed iu his eveniugK at home. Thid fact a getting to 
be understood by tbo better class of artisans and their 
wives; and there ore not iinw very many mothers with 
youog families at work iu English and American factunea. 

§ 6. In almost all countries there isuconsUuit migration 
towards the towns'. The large towns and especially Loudon 
absorb the viTy best blood from ail the rest of Enj^land ; the 
most enterprising, the most highly gUtcd, those with thu 
highest physique and the xtrougost charaeteni go there to 
find scope for their abilities. But by the time their children 

I children's children liavc grown up without healthy play. 



BOOK IV. 
CII. V. 



Thn Un-n 
altniot 
tbio tblM 
of Uiow 
Uini ill tlife 
cuutitrj 
anil tnini 
life il«- 
fltroysibotr 
■trmctb. 



■ Thu at the htsfnaliiii of tbi* mitnnr tlir prirnLnlioti nf J/mAan vu Jnsl 
undsr • aiiUiaii, «nd tlwt of the iiiih«ii next luri-taL luwiui in EiiKlni'd uiil Waloi 
ITM abMt Ifro-UiinU ot ■ nilUioii: )iii( in IMKl oacb of Umh BsarM ImuI rtmnlo 
Mwlj (««ir mnUoM. Thu li the i<opulation of tho very Urge tewni luu inerMMd 
aum UiMi fewr-Mil, wUilii Uuit of Out rural rliHtrirt* Imk ii»t nearly <liiii1)]v4- K 
tUid of tfau popuUUut) oi Kiicluiil i>u« Lviv in tfTWiin. liaviiiK mutv Uian ■ linn- 
(li«d ilunuaiul [nliatllauU, auoUiL^r ililiil Ici Umiin baviiiit tuurf Uiau tlime but 
not ntore tJisii a liiuidred llinuuiul inliabiUutU. an^l rnilr > lliircl in mm) dirtriei*. 

8Ibm tits begiiuilng at Ibia cuilurr, uliili- lli4- |ji>|>iiliLtli.iij of Fmiinf Las iti- 
rniiH il on)f I9 one-tliln), that <rf I'aria hna inrrRUn) (mir tnld ((rnni abonl ax ti> 
IWMltj-folU bnndnit tboiuaitd), and ihut of Ibu oiiif next larECvt lowoa luu 
taenHoi thtM-foU (froai abtriit ^ix lo (Igliicnn I>aiiitr«tl ltioR?uiil). 

Iu IIm Dnltod Stale* ot AmoHca al tbu UiEumiug ot IIuh oaiiturjr (inly (our pur 
ciniL uf Lh* popalaUuii lived In rlciciot ets^n tlionianil InliatlluiU and uiiM-anbi: 
liHt mnr« tliao lirwitjr.twn per Mail, iu 1880. 

In dwrntaj tba lowra int r aa wj at the txintniin oi th« toim try b^ about 00a 
lull i«t c«bL «f ttw (opolalion tntxy ftat. 

la eacb irf UiMe oonntriM tlie gruwUi ot Uih loirii popDlation ia Id ■ erwt 
memm Aat to Inuiilcratiai] ttaia Uic c-rantir. But eapwUUj l» XiHa itiecaM 
la Tnuea. Iu iba flvc jean ISTH— Si. Uic ckcliih oI bittlis «tm- duUia tn Paris 
WM kut SS.OOO nhll* tlil> total bKr«BU at [lOtJUkliou inaa SSO.UOO- in tli* IS 
lomB naxt in aU« lo Patfa tba cmom ef birtlia otbt iliwtliii van 1 .%iiixi nnil 1)10 
total inmiw of i-ojiiilnLiua waa 8%00l). In I.yona and Uandllo, wbore tlirro 
MB umtiy Italiaiia. Uu>Q8U the total population iiien«Hd by 33,000 auil 41,000 
ttiif(K,U-rTlr> tbe binlu actually Ul sluirl of tlio ilntlid b]r XHCd ami 3,<XI0 reis]it«- 
tiTdy. (bra M. Tmuaamt I<iHLa'a paper roprodocec] tn [La Btatittical JmtnutI tor 
OoMnhn.un.) 



254. 



THE SUPFLY OF LABOUR. HEALTH ASD STHENOTH. 



DOOK [V. 

ea. T. 



I 



Tlie mcir- 
UUVata- 
OKtimOt 
towiM arc 
ftii linger ' 
(eel lui'a- 
mre of the 
Mil Injory 

UrlmtUi 
tbem. 




and without fresh air there is littk trace left of th( 
ttriginal vigour. This is seen even in trades that require 
but litile muscular strongth; only a very amnll proportion 
of thuao urtiKuns to whom Lonilon owes its pre-eminence 
as a centre af highly ekilletl worJt eumu from [mrent-" who 
were bom there; and there are scarcely any whose grand- 
pareutit were born there. 

The di-ath-mU; of large towns givc» no just indication 
of thbir effect on the health and vigour of the people^ 
chi<'ily because many of the town influences which lower 
vigour, do not appreciably affect mortality. Other reaaona 
arc that the immigrants into towns are gecerally picked lives 
and ill lite full strength of youth ; and that young people 
whose parents live in the country generally gn home to die. 
The mortality of females in London between the ages of 
fifteen and thirty-five is for this rea.s(iD abnormally low'. 
If however a town has a stationary populatiun its vital 
statisticii are more easily interjireted ; and Belecling Coventry 
OS a typical towii, Mr Galton has. calculated that the adil^|fl 
diitdren of artisan tuwtiKl'ulk are Little more than half as 
giumuruus as ihusv uf labouring people who live in healthy 
country districts*. When a place is decaying, the young and 
strong and bt-arty drift away frfjm it ; leaving the old 
and the infirm hiihind them and const'tiuently the birth* 
rate is generally low. On the otber hand a centre of 
induMtiy that i« attracting population is likely to have a 
very high birth-rate, because it has more tban its share 
peopU in the lull vigour of life. This is especially tl 
case in the coal and iron towns, partly because they do not 
suffer, as the textile towna do, from a dL-licioncy of males; 
and partly because miners as a class marry early. In some 
of them, though the diath-mt« i« high, the exceaa of th« 
birth-rate over it exceeds 20 per thousand of the populA^H 

' Sm- Mr Wi'lU'H ill tlii<< Sl^li'lifal Jitumul, J«!iOi»ry, IflSO. 

> StatiMkiU ./aurua!., Marvli. 18i>1. lu Ike ViuUil Stale* iatant nMrtaBtT' 
iiiraiiuiul hj lUw ituuiU'i «iil ol ewry KKX) nl iuhU- clillilm) wlio dlo buforc lh«7 
ar« ■ rou' iiUl in KKI ill thn citin. luid cnily 4i in tbe I'Muutry. Ou Uui SonUi 
AtliLtJlLi- em-at it In 343 tii CliarlMtoii nnil 111 In Utr couiitrr. On Uu> Fttdlla 
eoMt It is I&? fai Run Fnneino and Odtlaiid, bat 011I7 60 (vrllia (niTOB«&^^ 
eomitiy. (S«« Tenti Cen#ii«, To], xt.) 



^ 



THE ISFLirEN-CE OF TOWX HIT. 



255 



Ion*. The denth-rate is fjc-nemlly highest in towns of the 
second order, chiefly bwauee their sanitary arraDgemeiits 
are not y«t as good as those of the very largest towns. 

There in pyrhapa no bttter uay uf jjublic! aii(! private 
>ney thnii in providing public parku nml playgrounds in 
larffu cities, in coutnu-'tiug with railwaj-n to increase the 
number of the workmen's trains nin by thorn, and in helping 
thoue of tht* working classes who ara willing to leave the 
large towns to do so, and to take their industries with 
th«m; while money spent on reducing the cost of living 
in large towns by building workmen's hoiiwjs at a loss or 
in other ways, is likely to do aliuuBt as much harm as g«*o*I, 
and MimetinitiH even more, tf the nutnbeni nf the working 
claMes in the- large towns are reduced tu ihuse wliuse work 
must be carried on there, the scarcity of their labour will 
enable them to command high wages; and therefore if sani* 
tnry lawK and rules against overcrowding urc rigidly enforced, 
and space enough is secured to proindc opportunities of 
healthy play for their childruu, those who live in large 
towns will have a better chance of leaving a healthy progeny 
b«hind thum; and mcanwhtlu some chuck will be givcu to 
the migration from the country to the towns', 

§ 7. Id tho earlier stages of civilization oatunU selection 
ad competitioD caused those who were strongest and most 
ngoroiia to leave the largest progeny behind them. It is 
to this cause, more than any other, that the progress of the 
human life, as of all other forma of life, is chiefly doc ; and 
though in the later stages of civilization the rule has been 
the upper claascs to marry late, and in consequence to 
bve fever children than the working classes, this has been 

apensated for by the fact that among the working clawes 

Bmaelvefl the old rule has held; and the vigour of the 

^lattOD that iH tending to bo damped out among the upper 

classes is thus replenished by the fresh stream of strength 

that is contitantly welling up from below. But in France for 

a long time, recently in America, and to a less extent in 



HODS IV. 
ClI. ■[. 



Tlienood 
tir plmj- 

mill olricl 

Luirs ill 

lurfc-c 
ttiwiis, 



Kiiturc lofl 

l«'iiiU M 
wuei] out 
die vtMik, 

Ijiil mikii 
hu itiMC- 
fi-lvj. 



■ Dt Bcddoe ou tlic Prvgrr** of PMic Jlatlti. 

■ fi«c Ml arlir-le coi Wtute la Aaiur iht Londf» Poor br tba pnwiDt nutlLor hi 
CemUm^ararif Jiimic, for Fubrtuu^, 1888. 



Hnoh well 
nuBMtA bii' 
DIM) ■«lian 
tau Ibn 

effocl of 

tiie iii- 

Hut alroiig- 
wrl anil 
eiLithlinjf 

(tjit to nir- 
»ive. 



Euglaiid, there ha« bwu some tendency for the abler 
more intplligi-'Dt part of the wnrking clasH population 
avoid having large fauiities ; anil this is a m\xnx of great 
danger. 

There are iucreasing reasons for fcariug, that while 
pr»gre!<s of medical Kcience and sanitation are Kring from 
death a contimmlly increasing number of the children of 
thoBO who are feeble physically and uieutaJly, thos*-* who wis 
strong are tending t« defer their marriages and in other ways 
to limit the number of children wLum they Eeave behind 
them. The cauBe» arc partly »ellish and partly unitellish; 
and the furmer probably do lei«5 harm than the latter; for 
perhaps it ia best for the world that hard and Mvotous people 
should leave but few descendants of their own tj^)©. But 
many people marry late, and have but few children, ia 
consetiuence of a desire to secure &b good a social position 
08 possible for themselva'* niid their children. This deaire 
contaius many elements that fall short of the highest ideals 
of human ainiii, and in Bome cases, a few that are dis- 
tinctly ba*o; hut after all it hae been one of the chief 
factors of progres.s; and thoKo who are affiect^-d by it include 
many of the best and strongest of the race. Such pereuns 
with a high sense of duty, are specjiJIy likely to be in- 
fluenced by the doctrine that large families are injurious 
to the world and that they can do better for a small than 
for a large family. We miiHt [wstpone to a later stage 
the enquiry how far the real demand for labour is capable of 
being increased, how far the gn>wth of population involves 
an increased pressure on the means uf eubiditteucu. But 
looking now only at the side of stipply, and considering the 
causL-^ that determine the supply of vigeur, we must ofHnn 
with Mr Galtnn that if the doctrino were to bo acted on 
generally by the upper part of the nation including the great 
hotly nf the moru intelligent uud capable artiaan-t, but nob 
the lowest ctasfies, it would cauee the race to decay '. 



< It hoi iJrriulf b««n nolt^eal Uitt t]i« c«lltiiw7 nf the rall^una ordan jirobablj 
AiA not affect tlw Krowlli ul Mmuban icrj loaeli : U g*"" A fotiitoiar itirtitii-oii ta 
the fuicca ti'iidluH to ki<cp Uist snn*tb in clivck, liat it ]>rob«bl; iUt nut nM inwdi 
to tliuir cdTnHB. ltd tiiaiii iiifluciirv was ii»t on tlif qniintity hnt oa llw ijiMUtr ot 
tlip iHJiiiiliiUuii. " Wlii'iiovrr n tiinii nr trunuui wkb poMcaMil of ■ iciuiUr nalw 



mXL AND 



SELHcno*^. 



S«7 



rt ni[i8b b* renipmbpffd that tlie membera of a largo 
fajnily ediit-Ato one another, they are ustiall}' more genial 
ami bright, oft«ii more vigorous iii evury way than the 
members of a Jimiill family. Partly, no donbt. this is because 
their porente were of unusual vigour; and for a like reason 
they in their turn ari; likely to have large and vigoroua 
fiuniUeft. The progress of the race is due to a much greater 
oxttint than appears at finst sight fo the desccndante of a few 
^CL-pl-ittiittlly large and vigorous families. 

fint on the other band there is no doubt that the 
iiilt Cfui often do bett«r in many ways for a small 
family than a large one. Other thingn being oqnal, an 
iucrenso id the number of children who are bom caxiecs 
an increase of infantile mortality; and that is an uiimix(^!(! 
evil. Th«? birth of children who die early from want of care 
and adequate ineaoa is a useless at-rain to the mother and an 
injury to the rest of the family'. And though these evils 
may be reduced within »mu1l: compaas by thoHe parents who 
4U<B eieocptionally good managers ; yet example is aiway.1 



CO. V. 
The Sum 

fruiii Lnrgc 
[uiiiUph of 
Iwdtbj- 
ebSUrm. 



o[ inf&nt 



I ftHad tdm or hn Cu Ae^ia tit chariij, to inMlitdUoii. u> liU-mlarc or Ui art. Ui« 
•octal CdndHiun of Uiu Uuur wm hqcIi thai tbuy liud iio ruF>;f;> elscvUfru thou In 

th* liLmiUi €if tl»i Chnrdi. Bat tli« Cliiu'fh clioi^ tt> |ir««rli ntnl ona^t '■fillliiu-f 

8h* |irK4iaed Uioiw ait* nliich lirpolerit nnnlil ate wlia aimnl >t creating fora- 
tiooat dmiliHii. wul •tapii) twluna. No Rtmili-r tLal dud Uw ]iT*tKilnI for omi- 
tvlH 1b BOTOjie." Umuwlillc b; bur jH-ntc^ntlnns nt tlintir irlin ww " llii* mMt 
fMrfan, lntl.li*MikLnir. S<i<l lnt«Ili||i»»t In Choir diihIpi iif Uxnijili'l iui<l Uitrrtarr tli« 
■BMtMitAbIa |i>TcnlM uf ■ hjjili dTiliuLidii. *hv ytai a «(r<ijie rljw^V, If uot • illrerl 
Map to lk«ir profMijr.'" {/JtrttHftuy G*iu'ui, f. HMi. 

In modcni tima* the nunc eril on m Urgur woId wm inf^ii in tlm Snnthani 
S(*t*Mi <d AaiMic^ wliisv manual work VcauiD di*iir*ccfal to the wbiti: loan; w 
tkal if ■asbl* la Iutp tinrrt tiiniiwtf lie M k iNillrjr dr^Eiirnite Ijtc. itiiil M-ldam 
narrtari. Affaiu. ou tbu FauiSo tUutx^. Ihttn wi'TV nt (mo llino jutl itmuiiitit tax 
t<Win( tlial all hot hitlil<r akfUpd «ia-Ic wutilil Iw Itrft tu tliv Cliiune : miil Lliat lh» 
Hilla niMi «<nild liT# in ui artiflclal ir*y in whlrli h fninlly twaniu k gfCRT vx. 
pHiM. In Ihu ciiHi CliuiiHw tiv*a wooM liaio bcwii iiiil»tilutoct fur AnirriMn, and 
Uw arcra^ qsalil}; u( iiie Iiuuulu tbcu wuulil Lat'ii toea liiwurv4. 

' TllB eitont <it llir Intuit iiuirttlitj' that aiini'* fmiu preTcntalile causte maj 
fa* tufertMl froui tli« fiictn Uial while Uiti annual (lMit]i-ril« of rbEIflron under Avti 
JM*« at tfpr II only abcinl Ivo |wrMat. In tba faiRilina nf imbi-ii *h<1 ia leaa Uian 
llffoe per «cnl. fur tlio wiiolc of tlic spper claaaw. it ti b«twevii nii anil mn'ri jibt 
mit. t(ir tb* wliiJ* iif RtifclBiid. For tliv iiiqxv cUum Iho cxjiMtatiun ot lil« at 
Urtb b M Tnn> aud at l«u 71-an o( anc it li 53 Twn: bai for the ulicJu irf £■«■ 
kid Ihft fltpecuiiMi of Ilk at birtli U nnlj 41 jcan, whlln at tcu yenn of vp>, 
Iwrtiat of htog biwar, it tiwm tn 47 ;rani. (Smi Mi HuuiliLrcyc' i«]>rT In Ihr 
SUtMHtdt Jmnut lot Jniic. 1BS3). 

17 



S58 



TU£ SUPPLY OF LXBOUfi. UBALXU AMD StStSVQTO. 



BOOK tV. 

cn. V. 



PractlcMl 
conduBion, 



Tho Bway- 
in;; U> ntiil 
[ro •»( the 

tuRiii; o[ 

gOoA am) 
evil. 



T^ 



'ninf<tniicr 
Itrnpiiiida- 



more potent than precept, and habUa of prudence vill 
uprcad atuuug the people, so long on tlm imtiiral leudem of 
the people marry early and have larger families thao they 
can expert to briug up wt^ll if th«y should meet with any 
considerable misfortunes in their own career. 

There are other coDsiderations of which account must be 
tnken. Hnt no far as tlie |)oiuta discussed in this chapter 
are couceraed. it aeeius prima facie adviaabli* that peojjie 
should not bring children into the work! till they can eee 
their way to giving them at leaat as good an education 
both ph^'sical and mctntal as they ihcmtielvrK had; aod 
that it is beat to marry moderately early provided there 
ia sufBciunt aelf-coiitnil to kcup the family within 
requisite bounds without trnnsgreasing moral laws. Th^ 
general adoptiou of these prjncip]t;a of action, combined 
with an adequate pro>*i»ion of fn^^h air and of healthy play 
for our tov.*!! populations, could hardly foil to cauK- the 
strength and vigour of the race to improve. And wc shall 
prefiently tind reaeon« for believing that if the strength and 
ngour of the race improvoa. the increase of uumbcre wiU not 
for ft long time to come cause Q diminution of the average 
real income of the people. 1H 

§ K. Thus th(;n the progresji of knowledge, and ID 
particular of medical seionce, the ever growing activity and 
wLidotii of government in all matters relating to health, 
and the increase of material wealth, all tend to leKsen 
mortality and to increase hcfalth and atrengtb, and to 
lengthen life. On the other hand vitality is lowered aud 
the death-rate raided by tho rapid increase of town UAfl 
aud by the tendency of the higher Htraiiw of the population 
to mairy later aud to have fewer ehildren than the lower. 
If the former set of caniie)! were alone in action, but l^| 
regulated as to avoid the danger of over-population, it ^^ 
probable that man wuuld ijuickly rim: tu a phy»i(!al and 
mental excellence far Ktipenor to any that the worl<) has 
yet known ; while if the latter aet acted unchecked, 
would speedily degenerate. 

As it is, tho two seta hold one another veiy nearly 
balance, the former slightly preponderating, ^^'llite 



OONCLUSIOS. 



25<> 



lation of England in growing nearly as fkst as ever, 
those who are utit of health in body or mind are certainly 
Dot an incxeaidng part of the whole ; and tlie rest are much 
better fed and clothed, and with a few esceptions are stronger 
than they were. The old Euglwli Life Tabie, baned un 
the fignreB of the years 1838 — 54. nhoww one-half of the 
moles dying before they are 45. and of the females before 
they are +7, while the New Table, baAed on the figures 
of 1871 — SO. rwses these ages to 47 and 62 reapectively. 
The dmth-raU; is much lower than it was in the earlier 
years of life, though higher in the later years: and of the 
total number of years added Ut life by the greater longevity, 
two-thirds fall within the most important period of 35 to 65 
of age*. 

t 8ce SatrUmcnl tu tbr 4Mh Annoal Bcport ci lb»fia(Mnff SmsbI; wdlb 
Huiuiilu-n;*' pa|N>r lu Uie siaUitieal ^aumat lot.hiat, IttSt On Uw eonpuattn 
Iwglh of life in lUflomit OMUitriea. mht Dr Bodio'a mrk ■Ircod}' rcforrwl to, ud 
Pt p MBM»'» S^U Cl»M^fiMmotit per Ela, Sk. 



17—2 




■I«l Kinds 

l&TKt'ly on 



Tbe luUvl- 



§ 1. Havinq diacuBScd the causes which determine 
growth of a uumerous and vigorous population, we have next 
to consider Che troiDing that Li required to develop i^| 
industrial efticieney. 

Tbe natuml vi^ur that enables a man to altaiu great 
suceetis in any one pursuit would gcu<>rally have served him 
in gooH »tead iii almoHt any other. But there are ex- 
cuptioii& Some people, for instance, seem to be 6tted from 
birth for an artintic career, and for no cither ; and oocasion* 
ally a man of great practical geuius is found to be almost 
devoid of artUtic seUMibllity. But in bpite of thene iiidividua] 
exceptions, a race that has great nervous strength Mems 
always to be able, under favourable conditlunK to develop 
in the course of a few generations ability of any kind 
that it may wish to have. A racu that has acquinxl 
■rigour in war or in the ruder forma of industry sometimes 
gainH intL-llfctual and artistic power of a high order 
very quickly; and nearly every litcraiy and artistic epo(^^ 
of clawtical and mediieval times haa been due to a pBC^pl^| 
of great nervoua strength, who have boen brought into 
coutact with noble thoiightH before they have acquire^— 
much tante for artificial cunifurtji and luxuries. ^M 

The growth of thla ta^te in our own age has prevented 
us from taking full advantage of the opportUQitic« 




IWBKaLEIJ LAfiOUK A SKLATIVB TSBM. 



261 



iocreMed Tosourci» gtvij :is of cotuwmting the 
port of thu hif{tiettt abilities uf the race to the 
higheHt aims. But perhap» tbo iutoUectual vigour of the 
ag# appears less thau it really Lt. in consequpnce of the growth 
of ticitjtitific pursuita For in art nad literature euccesa is 
oftoti achieved while gouius still wean the faacmating 
a»ii«!<;t of youth ; but in modem science so miicb know. 
ledgti iij required for origiuality. that Wfore a student can 
make hiii mark in the world, his mind has oiten lotit the 
KrHt bloom of its freshness ; aud further the ri;al value of lu« 
work iH not often jMtent to tho cnultitiule a» that of a picture 
or poem generally is'. In the Haiue way the solid qualities 
of the modem muchiikc- tending artisan arc rated more 
cheaply than the lighter 'virtues of the mediffival handi- 
cntfuuuui. This ix partly bucaiiec we ore apt Ut regard as 
commonplace those excellences which ore common io our 
OWD time; aud Ui overlook the fact that the terra "uu- 
tiJled labourer " is constantly changing its meaalng. 

S 2. Very backward racea are unable to keep on at any 
citMl of w«rlc for a long lime ; and even the simplest fomu of 
what wc regard as uaekillod work is skilled work relatively 
to them ; for they have uot and they cannot get, except by 
a long courac of training, the asuiduity, which it demands ; 
but where education is universal, an oecupation may fairly 
be classed as unskilled, though it n^quirc;* a knowledge of 
reading and writing. Agaiu io dii^trictti in which mauutao- 
WPes have long been domiciled, a habit of resjmnBibility, of 
carefuluesH aud promptitude in haudling expensive inachinory 

BmateriaU becomes the oommnn |)n)perty of all ; and thea 
tt Oa% cutiniMllaiii fl la worUi while to hoIIm ihftt lb« foil Imporiwuw of »□ 
makUif idoft iH oflcn wi pflrcjiivacl in tbo g«nDntiuii iu wbi«b it U 
il mUtU the UionKliU of tlie woHil ou & imv track. Iiul tU* «hanfn of 
■■■■■■Ml la not otnloD* Uiilil llir turului; |Hjliit lian ticc^ left ikiiiii; <miv hrUnd. 
I Ib Uw •Un* WV lk> niMliaiilckl liiviuiUmu at ntvrj age %tv spl ta be luuWfnktad 
nlttivdr In UioM of eariior tltuen. Fur ■ iicvr iU«tovvrj in i>i'lili>iu fnliy vlIi<a7llTU 
fur pr»ctk«l imtpOMW tiU tautj niLivir uupiutFiMiiiilii wul kutwiilliuy iliscuivrldi 
!■■•• ic«tli*t*(l (bttnioIrD* ■nmii'd it r sii bivoDtioo Llial inalmi aii t^uieh U Ttoy 
9tleu ■ (eocntiou oUlrr Uinu tliu n|>ik.-h which it nskM. Tho* il t* that «ub 
UMUMlMuu »niin to b* rlii>n% <H-cii]jiul in wuikiiig vat iLr tliouglita uf tb* |ir»- 
•dbv toe: wliila Ibc CuU impvrtuiiw vt [la uwu ili<iti|tliti> In am yt not tlaarly 



BOOK IV. 
CB. VI. 

tulltht b* 
IwiteriiMd. 
But per- 
liftpuwoftts 
iii-cliiii-il Id 
ntjileiestb 
loatc it. 



tintlcilleil 
IkbauT. 



Hkm n-iUl 

Wtlldl HP 

luv (aitiiliftr 

Wi- ilftiilJ 
ila nut rr- 

sliill. 



262 



THE SVPPLY OF LABOUR. IXDUSTBIAL TEAIKIVO. 



noi!« rv. 
en, VI. 



nuuioal 
■kill in 

rcldlivoly 
to |[>'iit'riu 
iDtoUi- 
t;iTiji!« nnil 
vigour of 
eliu'ifter. 






much of the work of tendinj? machinery v* said to be enliret^ 
me-chanicnl and iinskilNxl, and to pall forth no hiiniai] facility 
that U worthy of ostecin. But in &ct it is prol>able that not 
one-tenth of the prpseiit [lopiilatioiw nf the world have the 
mental and moral fnculticB, the iutclligi-iico, and the setf- 
coutxul that are rei]uired for it: perhaps not one-half could 
be m&'le to do the work well by steady training for tn-o 
gent^rationft. Even of a manufacturing population only a 
small part are capable of doing many of the tasks that 
appear at lirst eight to be entirely monotonous. Machiue- 
weuviiig, for iuwtanct;, itiuiplu aa it scenia, i« divided into 
higher and lower gnwlea; and mKwt of those who work in the 
lower giadta have uot "the stuSr in tlium" that is required 
for weaWng with several coloiirH. And the differences are 
even greater in industries that deal with hard material 
wood, or motak. or ceramics. 

Some kinds of manual work require long-oontduuc 
piucticc in one eet of opcmtions, but tht^sc cases are not 
very common, and they are becoming rarer : for machinery ts 
constantly taking over work that ryquircs manual skill of 
this kind. It is indeed true that a general commnnd over 
the use of one's iingeR is a vetj important element of 
industrial efificiency; but this is the remilt c^hiefly of nervous 
strength, and self-mawlery. It is of cnunjc developed by 
Irainiug, but the greater part of this may be of a geiieial 
character and not special to the jMirticular occupation ; just 
as a good cricketer soon learns to play teDuie well, so a 
skilled arti»an can nften move into other trada>i without any 
great and lasting loss of efficiency. ^M 

Manual skill that is hu specialized that it cannot v^ 
trau^erred fixim one occupation to another is becoming 
steadily a leas and less important factor of induKtrial ef- 
ficiency. Putting aside for the present the ^ulties of artistic 
perception and artistic creation, we may Bay that what makes 
one occupation higher than another, what niakus the workers 
of one town or country mure efficient than those of anutbor ia 
chiefly a auperiority in general sagacity and cntngy wl 
not specialized to any ouu trade. 

To bo able to bear in mind many thingt at a time, 




QEKERAL AND SPBCIALIKBD ABILITT. 



S63 



er^'tbiug ready wIil-ii waulcci, to iu:t promptly and 
show resouroc when anything goes wrong, to acconimodate 
oneself quickly to changes in dctaiU of the work done, to be 
steady and trustworthy, to have alwnys a. reserre of force 
which will come out in enjergency, these are the qualities 
which make a groat industrial people. They arc not 
poculinr to any occupation; they are wanted in all; and 
if they cannot always 1k' enwly tmnnforred from ones trade to 
other kindred trades, the chief reason is that they require 
to be HUpplemented by Humc kntiwledge of materials and 
liliarity with Bpecial professes. 

We may then use the temi genkral abilitt to denote 

those faculties and that general knowledge and intelligence 

which are ui varying degreeM the cxiiiimun property of all 

the higher gra<leit of indnstn': while that mamial dexterity 

id that acquaintance with particular materials and pro- 

which am re(|iiired for the epcrial purposts of indl* 

trades may be classed as specializeu ability. 

§ S. General ability depends largely on the surroundings 

of childhood and youth. In this the first and far the most 

powvrftil indue-nce ib that of the mother, when she docs not 

abdicate tt for the sake of dearly bought wages or for more 

selfiuh purposes'. Next comes the inBiience of the father, 

oi other children, and in some cases of servants '. Aa years 

, p tM on the child of the working man learns a great deal from 

^Kliat he sees and hears going on around him. Wherever 

^Hay high class industry is localized the habits of tnind 

' AcconllnK to Mr (MIon Uie iiUtfiiieiit tliat all ufMl lavu tiuve tiail j^rnal 
Botlm* Bcm Un l>r: bnt tliat Khu<r» oulj Umt tlin nKiUinri mlludiirti dixv not 
MLwdgh KlIotlMniiiat ttutt it ta oat ^vktvr lliui %ny cni-c< Oiltii. Ht toy* tint 

I IIm toathta'* laSatae* U moMt t*My tnri-Mn il>i»iu|{ lliMilofiUiiii aiv\ ni«ii iit 
MlHMts becaiiMi ftD eanioit tooUiei Ittada but chUit U) feci dwplj about grcBt 
tUUit*; aui * tlMiulil/al luutLut •loci iiut rct>rL-M, liul t'licoiiraK''^ >1i<i' i-liildUlt 
cnriiMity wludi ia tliu raw niittitrial at »d»iitiilc hnhltx o( thniicht. 

' TImi* an manT Bue natnrva uuuoit domatic lervauti. But Uioh nlic> livo 

I fea nty rieb Ilouea ara apt to gut u!ll-iiulal4<>nt ImMtn, Vt oipr-viitinintn tKei Ini- 
yoH WC B tS wwalUt Mid ^iierallf U- put tlm Iutvct aim* d Uh aluw ILr UitilitT in 
a *n7 tint b not commtn iriUi inrlc^ndciit woeldng p»u]>ltJ. Ihv ouiuimii.T iu 
m\tlKh tike dilUrMi tt wiar of cnu heiA luiuww npenil mndi iif tlii^ir liiui.-. in los 
wn u AH ag tlian thai of the nrmiKr rottnur. \'vl in ttiese irrj Liiu!it<». uu spriaiit 
rto tt unl qM^iuUjr ^ubUIIikI i> aUasad to tato chatBc i>f n jorui^ pouit4ir ur a 



BOOK 1*. 

cfi, VI. 



aAililf/. 



Tliccatum 

that iriai- 
iiiliii> tLp 
■uppl}' ol 
geuenl 

ability. 

Tluibomc. 



2G4 



TBI: St'PPLY OF LABODB. INDUSTKUL TRAIXIXO. 



BOOK IV. 
CH. VI, 

8rli(Hil. 




tl(NU of 

liberal 



and body required for it ore a» i& said "in the ai 
are in a great measure acquirc^d uncoasciouGly. 

In schnol thf; faculties am educuled auil ihe inluQ ib 
prepared for the sc-rious worli of lif^. Many niu^t coast^ 
their school work wheu they have but learut the element 
of rofidiiig, writiug, arithnit^tic and drawing; and it in som« 
tiiiieti argued that the child wuutd be lietter t]tted to earn 
hia living if part of the little time spent ou these subject* 
were ^veii to practical work. But this euggedtiou aeems 
to overloolc the fact that the advance made during school* 
lime is tiot nearly bo important as the power of future, 
advance which a schwil etlucatiou gives. Ri^ading and writit 
afford the means of that wider intercourse which leads 
breadth and elaaticily of mind, and whiuh is enabling th*' 
working man of to-day to be as capable a citizen a6 was the 
couutry gentleman uf luftt cfutury'. 

Before the recent great progress of science and art 
old gruuunor school educaliou was the only oue by which 
average achool master could induce his pupiU to use their 
minds in auytliiiig tiigher than the absorption of knowledge. 
It was therefore rightly called liberal, because it was tba 
beat that waei to bo had. But it failed iu lie aiiu oCH 
femiliaiizing the citizen with the great thoughts of anticjuitj*;^* 
it was generally forgotten as soon as school time was over; 
and it raised an injurious antagonism between bufin^ss and 
culture. New however the advunee of knowledge is enabling 
UB to use BciencB and art to supptoniout thy curriculum of 
the grammar school, and to g^ve to thoae who cun affoi 
it an education that develops their best faculties, and s 
them on the track of thoughts which will most stimulat 
higher activities of their minds in after life. 

But while a truly liberal general education adapts 
mind to use it^ best faculties ia business and to use bueinen 
itself an a means of iucrcattiug culture, it does not concern 



asa_ 

«t« 
tns 

»0l' 

uie 

thX 
the 

4 




■ It {■ Ime thkl lonmEiij to Rpdl {Una not tilac&le tlip tunltlntaknyt 
Al>le«xtfliil, kt»l tlint tlii> tinio upoEit on il in ntArl^ niu>l«d. If NiwUiiig i 
nnucifttiou could bo htoag'Ui into liAmionjr in tli« EiiitlUfa iMignagt, •• Ukj kn la 
uiOHt utUur laiJKuaff0i< ohlldnu would, It luu W«u aotinutMl, be a.Vk lo mil 
floentlf n ;>*i' carlliiT thui Uicy ttr uuw. 






LIBERAL &KD TECHNICAL EDUCATION. 



sefr 



■OOKIT. 

OS. n. 



»If with tbe d*;taila of particular trades. Tliat t&ak is left 

>r kchnicol vducatiou. 

§4. Technical education has in like manuer raised its aims T«!imit«t 
in recent j'eare. It. naed to moan little more than imparting 
that manual dexterity ajid that elementary knowledge of 
machinery and proce&scs which an intelligent Ind quickly 
pick« up for hiniAeif when hie work hai^ hejpjii ; thnu^h if he 
has learnt it beforehonii, he can perhiipa earn a few shillings 
more at starting than if ho hod been quite iguomoL But 
such )so-ca.Ueil education doe-s not develop latiultip-H; it 
rathflf hindere them frum buiiig developed. A lad who has 
pickt-d up tlie knowledge fur himself has oducatcd himwlf hy 
doing, and i» likely tu make better progress in the future 
than une who has heen taught aft4^r this fasliioii. Technical 
education is however out-growing uiit^take^ of ihU kind. It 
is aiming, on the one side, at givuig a gt^n«ral euninmud over 
the use fjf iry«» anil fingi-rs'; though there are »igti» that 
us Work is Ijeing taken over by general education, lo which 
properly belongSL On the other side it aims nt imparting 
wtistic skill and knowledge, and niethods of investigation, 
|Which are useful in particular occupationB, but are seldom 
roperly aomiired iu the course of practical work. 

Continental systems of technical education give habits of Tiir 
^order. assiduity and docility, they «ture th« mind with ueeful MIl'X. 
information; and the German system, in parttculnr, has pn>- "pj'"*" 
luccd a race of meu who are better fitted in some it^pects iiii«i>tal 
■ do the work required of the middle ranks of indnstrj- than 
ay that the world ha.t ever seen. Aided by their know- 
I«d^ of modem languages German clerk*, commercial 
ageote and scientific advisers are supplanting others, in 
England, on the Continent, in South An»'ricn nnd elsewhere. 
Those of them who have natural resource and can turn 
tbo ad%'antages of their position to good nccount, become the 
of finus, and some of the best buaiuesa of the world 



I A* Mt Niutii<rlli ujrB. if a Iwl liirinK droppaiC two iwu nl nuirlitm nii r labia, 
iwililj pU a lUifd I'M iiiEilnuj ill a liii* twtweuu Uioiu. he in cij tlw n'air ta 
I » good BLMkanie. Coininaiut f>**r tjh ahiI hand la mtn*! In th» flMinaiT 
I gaaie*, M» Imw than iii Ihe plaffu] vtirk of Ibp Kudvr Oartoii. Drawbg 
ha> alny* htva od Ui4 b«r4cr ]iiiv ImIwmiu wurk auil plaj. 



S66 



tOB GVSPhX OF LABOUR. INDUSTIUAL TRAININQ. 



BOOK r>. 

CH. Vt. 



filiiL'ntion 
rvlonn. 



is passing into their handR. They also make excellot 
adniinistratorB uudiT gov(>riiiiiuiit, ajid thai is a chief reanpn 
why business under the control of government compares so 
much mure favourably with that under private* maoageraeQl 
in Germiiny ihnn in England. But the Wlanc^ of evideno^^ 
seem& to Khow that the Qernian system, excellent as it is 1^| 
many waj's, is not in all respects well Kutted for dereloping 
that dariug energy and restless enterprise which go to the 
root of the hardest difficulties. For this purpose the existing 
English system is already superior in some r&specta; and its 
defidoiicicM, though .still jfreat. are rapidly being fiUed up'. 

According to the be^t English npininnR, technical educa- 
tion fur thi: higher rauks i>f iudustry should keep the aim of 
developing the faculties almnst as constantly before it aa 
gciicrul education doi^s. It should re«t ou the same baKts 
SB a thorough general education, but should go on to work 
out in detail special braiichee of knowledge for the bcocfit of 
particular trader*. Our aim should be to odd the acieotific 
tnUDtQg in which the countries of Western Europe ore ahead 
of ua to that daring and restless energy aiid thoee practical 
instincts, which .seldom flouri.ih unless the best yeai« of 
youth arc gpont in the workshop; recollecting alwa>^ that 
whatever a youth learns for himself by direct experience in 

' Oil tbv wliuU n'u mar ony ILat nt |<rv8i-iit £iiulnjulia Tvr7tiin«b lidiinil htiid 
u* ivKariU tile prtK-uiimi fnr lUi' mnuiuincial nx well ii» tliv urliiiii'al edncaUon 
of tliF |irti|rrk-tur> uid iirxiiciiml iiiaiiiiiiiirn uf iudtiRtrinl wnrka : bill tlut. rliiiltj 
tliniiiiili Itiii iLdhioura- of Itit Si-iDniii niiil ArL Di'iiiLrtiDdiit <if Siiatli KennuRUm. 
ctptuiintary (or lowvr iwcoiidu7l twitutUic uiiil Icr tiuicbl cdnixitinn ranm • ritin 
nrtA in tliii tbon in uxj oLbur i>Aiiiitr)'- ITufiirtiiniitHly litiw*vi<r tUmp •dtuitagv 
nrc iirovcutctl hma beiiifl Liuncil tv the bcit nvcDuiit b; tbc «UU btckwanl condl- 
tiuii vt our tiliiuiuiitkr.T »diiKilB. Cumii'aru Sir Gnruliurd SajonEbon'* lYdaoa U 
Mr Mniit«j[UH'* exctJIcnt fuimuBry ol Uio l(«i>ciit ol Ui« ConuiiUiiuou ou TcdMical 

* 8«v tbi> Hopart 1B8I of Uto CtinuiilMinnmi «fi Teetuilcwl I u«trnf tiun, VnL I. 
1^. I'lOft, r.l-l, nltio tliu (>[jiuioi4ii of Sir Lovtliiau JivU, Prof. Buxlnj'. IH tiicowM 
Aiiil oibvn in Vul. uu at Uia Lteptirt. alsu Scoit BuiMll'a Teekmeal XdMtatkm. 
Scv sbu Uie rarioiia tiiiMicattouii uf cli« Nntioual AmocIbIIou for tlu PnmMiM (f 
TM-huli-itl E^nraticiii, One of Llir nrnliFsl |iniiita of Icdini col cdaratlnn !■ Ilutti 
timu not •dnotle tha Mmne u( |>rut>iji'llu[i mil llin itcntnt tcir •iui|iiii.-ft? of ibtaiL 
Ttiv RiiicUsh, Mid lo nil bvmi RitwUrr riUtil, 11u< AiiirruruiH. bavn tnqalnd In 
ortn*] bnriii«M Om Henlty of KJectLn;^ int.ri;a<iM in mo^hiiu'ij uid ptnoMttMi, 
wliicli ini iiiit wnrtli ivlial Uii^^' i-iul, Aiid pniftiuU iiiktiiicl »f (hi* kiti'l oflui 
cnabin tbcm to kiUMH.'cd iu i.-4iiii>vtitit>D witb Contuiooul riT»U nfao mn mach 
bcltcf cilucnUxL 




I'ECHMICAt. BDUCATIOX AXD WnRKSHOP TRAINING. 



267 



■well -conducted works, teaches him more and utimnlates his 
nieutal atilivity inure than if it wen; taught him by & master 
ill a technicAl nchool with model instrnmenle'. 

The old apprviiticvBllip ttytitum m iiul exactly suitud to 
modem conditions and it has fallen into disuse ; b«t a siib- 
6titut« for it i* wuiitt-d. Within the last few years mwiy of 
the ablest tnanufsctiirers have begim to set the faehirtn of 
making their sons work through every stage in auccefisioii of 
the business they ^11 ultimately have to coutrol ; but this 
splendid edacotiun can be bad ooly by a few. So mouy and 
rarious are the branchoa of any great modem industry that 
it would be impownble for the employers t« undertake, e.^ 
(ley used to do, that every youth committed to their care 
shuiild l«ira all: and iudtn^d a lad of i»rdinary ability would 
be Ix'wildered by the attempt. But it does uot seem impracti- 
cable to revive the apprenticeship syntem in a modili<!d form, 
with the understanding that the employer binds himself to 

tliat the apprentice is thoroughly taught in the workshop 

the subdivisions of one great division of his trade; and that 
he does not resit content with letting him leani only one of 
the»e snbdi\'isions, as too often happens now. The apprentice's 
traiuiug would then often be as broiui as if he hati been taught 
the whole of the trade a« it existed a few generations ago ; 
and it might be supplemented by a theoretical knowledge of 
all branehe."! of the trade, acqiiin^d in a technical school'. 

Something resembling the old apprenticeship system 
rccciitly come into voguo for young EDgtishtu(.'n who 

' A soai piMi i« tlut at tptniittg Ot» ni winUir inoiiUii ut HnverHl ^e»n uTUr 
tevlnit Mhool In U«mlng MJanon In Collciffn. nnil thn nix iiiinuuir ninntlui iis 
■fUelad pn|iili iu InrijL- varkiiliaiu. The prvsvat KTitvrititrwln<M<iltlib piuiMvenJ 
TMT* una at I'liWnraitj ('nU»iC<<. Brioliil. kiiil it Iibb klifi bcMi oAoptod Ul Jt^pttU. 
tSe* Qw) Report nliiivc qnotvd, VuL m. y. lti).> Bat il lina jinKtJoal diiDenltivB 
vhkb Cku tw uvcrroiuc duI; by Uiu Liinliiil Mid koucvotis co-ujicntioti ut tlic 
liwili of l«T|to Brni* wtth Uir Ci)llfiK« aiitlmritk-H. AoriUiiFt cii-cUf-iit pUn i* lluit 
■doiMMi In tli« (CtuM)] MUkIimI Cu tUe «urka at Mi-sim MuUier aii<l Plait at 
XaftckMiM. '* Tlui ilrairiiigi mada in Ilia icIiaoI an nl vork o.pttuill}' in iimgrriui 
(n (be •h«p«. Oil* t\»y lli« l«aelier fi*** Ui« IMeawMiT ATjilannliniia ami iMlrnla- 
lic^ Md tbc nrat ilaj the ncholars *cc. a* )t were on tlic ■U'ril, tk« rprj thiiig 
wUell Imb Innu tlie wbject uf Ilia lecliire." 

< Ab meelhiit Mmtr of ajipnntlcediliM in mlatinii In tlic prahletna of new 
floontrin b eooLdoail in the Ktforl a/ tki A'rio York Butatm q/* StatUlicM q^ 
X«tow for 1880. 



HOOK tV. 

(Jill 'n. 



Appron- 
ticMliiiw, 
tlirir pad. 



anA thair 

IMMSlllle 

iuturc 



Tedmical 
(niniuicfur 

tlie B^ 
rnlloTut. 



2m 



TB£ SUPPLY OF LJLBOUfi. INDUSTRIAI. TKAIXIKG. 



BOOS IV. 
CH. TI. 



Tlie lecb. 
nicMl cdu- 
cattail of 
nAaiW. 



luruutJiaiiH 
in EhbImuI 
uid aUiDi 

r (11111 trip*. 



led 

1 



dmhv to leara the businua^ of farmiug under the peciiU 
cuiiditiuiui of a new cuiintry ; and there are some signs that 
the plan may be exteuded to the busiue^s nf fanning in thu 
country, for which it is in many res{K>cta atimirahly adapted 
But there remains a griyit deal of «(Iu<!ation miitable to i 
farmer and to the feu-m labourer which cau bcHt be given 
agricultural collegea aud dairy suhixjls. 

§ a. ileanwhile many great ageucnes for the t«chni 
education of adults arc being rapidly developed, such aa 
public cxhibitionK, trado Bw>ociatione and congresses, and 
trade Joumale. Kuch of thein bos its own work to do; in 
agriculturv and tiomu other trades the gnratcjKt aid U> 
progreHS is perhaps found in public shows; bnt those in- 
dustricH which arc more advanci^ aud moru iu the bands 
of pereoua of btudious habits owe nioro to the diffiiuon of 
practical aud scientific knowledge by trade journals, which, 
aided by changes in the methods of indnstry and ai»o in its 
social coiiditionii, arc brenking \ip trade secrets and ht^lping 
men of small means in competition with their richer rivals. 
For thittte who cannot affoni to venture on costly eiperi- 
ment» themselves may if they will, read the record of every 
iinpiirtant new departure that is made in their businesses 
in any part of tho world But of thbt more hereafter. 

The great epoch making inventions in industry came 
till recently almoal exclusively fn>m England. But dow 
other nations are joining in the race. The exeelleuce of 
the common schools of the Americans, the variety of 
their lives, with the iaterchange of ideas between different 
races among them, and the peculiar conditions nf their 
agriculture have dt-veloped a resile** spirit of enquiry, while 
technical education is now being pushed on with great 
vigour in Massachusetts* and elsewhere. On the other hand 
the ditfuaion of .scientific kuowUnlgc among the middle and 
even the working clasees of Germany, combined with their 
femiliarity with modem laugiiagoa and their habits of 
travelling ia pursuit of instruction*, has enabled them. 



* Thn ttpleiiiliil UfttMcltuM^tU LiDtitntc of Twltu^kyr kniidoi tliadirMli 
Uic DCrnioiniiit, ririi«ial Wnlkrr. 

• The liMd* oT Hlnio*! e\evj ^tngrnuih* Ana oii the Canliiiout liarv c«retnll7 






THE BDCCATIOV OF THE WORKUJlK. 



269 



up with English and American mechanics and to imoh iv. 
the ieod in many of the applications of ehomiittry " °" "' ■ 
to bunnees. But yet the English retuii the first poaition 
in tht; alkali imhutJius, th« leading; idt>a in the aniline trade 
was due to an Englishman, and so an? the Ino(^t important 
chemico-mechauical iuventioiis in the manufactures of st««L 
Adding to the above the mechanical inventions of Armstrong, 
Jsawuyth and LiKter, and the electric work of Cooke, Wheat- 
stono, Thomson and othere. it is pe-rhaps not too much to 
say that more tlmn half of the pruiniiii-ut new industrial 
departures even of recent times are diip. to our countrj'nien'. 

§ 6. It is ofbeu urged that there are many kinds of sn (u- m 
-work which can he done as efficiently by an uueducatctl ™i„"^ 
as by an educated workman : and that the higher branches ""'"T'?' 
of education are of liltlu direct usu i^^tci-pt tu omployere''"Ti«i. *• 

' foremen and a comparatively small number r>f arti»ani4. bcueiluoi 
It may indeed be granted that some advocates of a great IjuoiUuii 
«XteDsioa of general and techuicM-1 education have injured J;^^'"''' 
their CMue by exoggeratiag the direct luid immediate 
beuefiu which the ordinary wnrkman would derive from it 
It is true that at present only a comparatively small number 

the ordinary workmen in the country are called on to go 
"beyond their explicit instructions, nnd to bring a knowledge 
of mechanics, of chemistry, or of physioa to bear oti the tusks 
which thoy have in baud. And although thi.s number is 
steadily and rapidly increasing, in consequeueo of the grow- 
ii^ complexity of the appliances of oriliiuiry life, as well ok of 
agricultural and mannfa^^turing iiidu»(trics; yet it must bo 
admitted that tbe chief benefits which the ordinary workman 
derivea even now from a good education are indirocl- It 

|fltiinulat«ti his mental activity: it fuHtentin him a habit of wii«e 
EDqiiisiciveneiiH; it makes hira more intelligence more ready, 
■Dore trustworthy in his onUnan.' work ; it m-ises the tone of 
Ids life in working boura and out of working houn ; it is thus 
■bidieii |nui.i»H.'H Mill machbier; in furoiKii ImhU. The EiislUb uy gnM 
inviallir*; hut partly |i*<ilia|nun xi'duuC af llii'ir i)c>i(irajiit< ol (ilbpr Uu^iuirm 
IIhj teem ku4l7 Ut ml Mionijb ulnro nn Uiij tm-Iiinral nlncatiau that can In 
§itB44 by tba wlao dm ol tnrtL Sav the Ibipurt (tuulal Bbora. Vol. i. f. 381 tnd 

>*MIIK- 

> lb. T«L 1. p. we. 



IKK MTPPLT OF LABOLR. IXDCSTRIAL TJUIXIKa. 




■■ hnportant meaiM towards the prodacHon of matciut 
««alth : at tht* same time that, regarded a» au end in itself, 
it a inferior to none of ihimi which the pruduction of 
■•larial wealth aax be made to mibservo. 

But vre must look m auoiher dlrectioD for a grtat 
part, pertiups the greater part, of the immediate ecoDOcaic 
gain which tht uatiou may derive from an jniprovemwit 
in xht general and tvchaicul education of the m»ea of 
Uie people. We must look not so much at tboeu who 
»Uy iu the i«nk and Hlc of the working elasses, as at 
tfaosu who liae from a humble birth to join the Higher 
i^n lw of skilled artii<ana, tu become foremen or employers, 
to adrance the boundaries of science, or possibly to add to 
the national wealth in art and literature. 

The law*) which govern the birth of genius are in- 
KTUtablc tt in probable that the percentage of chitdreD 
of the working cJnsses who are endowed with natunl 
abilities of tht! highest order U not so great as that of the 
ehildren uf people who have attained or hare inherited 
a higher position in Huciuty. But siiict- the manual laboor 
elagncs are fuiir or Bve times as uum^mis as all other 
classes put together, it is not unlikely that more than half 
the best uatiiral genius that is bom into the country- belongs 
to tltem ; and ai this a gtvat jmrt i» Ihiitlesi* for want of 
opportunity. There is do extravagance more prejudicial 
to the growth uf iialiuua.1 weulth than that wasteful negli- 
gence which allowii genius that, happens to be bom of 
lowly piu«iilage tu expend itaulf in luwty work. No change 
would conduce »o much to a rapid increase of materml 
wealth as an iiuprovemeut iu our schuuU. and et^cially those 
of tlie middle grades, combined with an extensive system 
of scholaistiips. which should enable the clever son of a 
working man to rise gradually firom school to school till he 
had the- be»t theoretical and practical education whic^ tha 
■gv can givo. 

To the abiliti&s of children of the working classes 
be ascribed the greater port of the success of tho 
towns in the Bliddle Ages and of ScotUnd in rcooiit times. 
Even within England itself there is a Itusson of the sBine 






LATtSr OENIUS AUOKO TilB WQKKINO CLASS&ii. 



271 



und to be loarnt : pntgrtjjw is moHt rapid in those parto of 
Urn coiintrj- in which the greatoat pwportioii of the lead«rs 
^of iadiistry are the sous of working ineu. For tustauce the 
beginoiug of the nmnufnc-titring em foiiiicl .sfKiial diHtirictions 
more closely marked and more firmly ealablishcd in the South 
than in the North uf England. In the South (iomE>thing of B 
spirit of cauit« has held inick the working men aud the aoua 
of working men froui rising to postn of coniinaiid ; and the 
told established families have been wanting in that elasticity 
and freshness of miiid which no sov'te} advantages can nuppty, 
and which conies only from natural gifts. This spirit of 
caste. &nd this deliciency of new blood among lUe leaders of 
induKtry, have mutually !m»tuincd one another; and there 
are not a few towns in the South of England whoee decadence 
within living memory can be traced in a great nu^asure to 
came, 

§ ti. Education itt art vtands on a sumowhat (lifTerent 
footing &om education iu hard thittkiug: for white ihe latter 
itearly olwa^ii xireugthoiut the cboroctor, the former not 
imfrequeotly tails to do thia Mevertheless the developmeDt 
,of the artistic faculties of the people is in itself an aim 
the very highest importance, and ia becoming a chief 

of industrial efticioncj*. 
The artisan of Europe iu the Middle Ages, and of eastern 
cxnintnM now, hot* perhn^w obtained credit for more origin- 
lity than he has really possessed. Eastem carpets for 
Me are full of grand conceptions: but if we examine 
a groat uiany examples of the art of any one place, 
selected perhaps from the work of several centuries, we 
often And very Uttlo variety in their fundameutal ideaA 
^n fiiot eveiy designer in a primitive iige is governed 
procedeot : only very daring people depart from it ; 
an they do not dejmrt far, and th<»ir innovations 
7«re subjected to the tc^t of experience, which, in the 
long run, is infiUlible. Fur though the crudest and most 
idiculuuK fa»hioiis iu art and in literature will be accepted 
f. the peo|}le for ft time at the bidding of their social 
ricira. nothing but true artistic excellence has enabled 
a biUlad or a melody, a utyle of dress or a pattern of furniture 



aoox I*. 

CB. Tl. 



Etlimtion 

b DTt. 



Trwliliuii 
■III) 

■lutrljr 
□wloral 

Kni'ln tlie 
•rtn at 

wlio tin not 

tln-ir linbiu 
111 llTiiti;. 



272 



THB SDPPLY OP LABOUR. IXDU8TRUL TRAINISO. 



noon r». 

CH. VI. 



.reas. 

"J 




But in 

aoiUim 

tlniM 



to retain its popularity among a whole nntioii for man; 
geuemtioiiB together. Those iiinovaticms iheu which were 
incoiuifttent with the trne spirit of art were inippiVHte^| 
and those that wiTe im tho right iraek were retaiiie*!, ai»1^ 
became th« starting jioitit iVir further progre#». Thus the 
parity of the industrial nrts was preserved in Oriental 
countries, attd to a k-as t;xlciit m medi»!ral Eiirupe. b' 
tiBilitionai iiiatincts. Btit in the ino<lpm era of ra 
changes, some caused by the frivolities of fashion aod soi 
\>y the bencltcial mnvementfl of indiiHtrial and social prajfreaB. 
every one feels fme to make a uew departure, ereiy one 
to rely in the main on his own resources : there is no slowl 
matured public critieiam to guide him. 

But this in not the o^nly. perhaps not the chief 
, advauUge, under which artistic design labours in o»ir own 
age. There is ii» goud reason tbr believing that the children 
' of ordinary workmen in the Middle Ages had more power of 
artistic origination, than thase of ordinary village carpeuters 
or blaelwmiths of to-day; but if on© among ten thoueand 
hnpjK'iietl t» havt? genius, it. found vent in hin work and 
was Hfiinulatvd by the competition of the Gilds and in^ 
other wayH. Wherotm (he niodeni arti-san is apt to t^l 
occupied in the luauugement of maehinery; and the faculties 
which he dpvelopa, though they may be more solid and 
may help more i» the lung run towards the highest progress 
of the human racp thiin did the ta-ite and fancy of hU 
medieval predecessor, yet do not contribute directly towards 
the progress of art. And if he should find in himself a 
higher order of ability than among his fellows, he will 
[jrobably endfavour to take a leading part in the manage- 
ment cif a tradea-uiiiou or some other society, or to collect 
together a little xtore of capital and to rise out of thflH 
trade in which he was educated. These are not ignoW^^ 
aims; but his woidd perliftpB have bt-cn a nobler ambition, 
and one more fniitftil of good to the world, if he had Rtayed 
in his old trade and striven to create works of bea\ity which 
should live after he ha<l gone. 

It niust however be admitted that he wotdd have gniat 
difficiihies in doing this. The shortnese of the time which 



ARTIfmC DESIGN. 



273 



•ve allow ourtJpIveB for changes in the arts of decpmtioii, is mm >»- 
]x*rtiap«« searct'ly a groalM l-vU thaii ilia width of the art-a over ' 
which they are spread; for that cttUNcjs n fiirther distraction ^'s*''* 
of the hasty and hurried effort* of tbt- desigiiHr, hy compf lliug Umltrf to 
him lo be always watching the world inovpmeQU of the profsMion: 
.■iu|)ply of and demand for art |)rod\ict8. Thia is a task 
for which the artisau, who workx with hia own hands, 
is not well fitted ; and in coosei_jueuce. iiow-a-days the 
ordinary artisan finds it hwit to follow aii(! not lo k-ad. 
Even the supreme skill of the Lyons weaver shows itself 
now ahiiotib t.-xcluMvcly in nil inhmtcd jiower of <lflit'ate 
manipuiatiou, and fine perception of colour, that enable 
him t»i carry out perfectly thi; idcuM of pnifeasional d««igner«. 

The prufpshion of the designer has not yet rieen to the best and tUi 
position which it seera» ca{iuhli.- of holding oven under modprn mw u 
conditions : as ih shewn by the fact that Parifi, which does not !"»j'l!lirt 
hold altogether the first rank in the highest walks «f art, ""'"^^ 
is suprciQO in the skill required for desLguiug. Increasing urFniSa 
wealth i» cuubliug people to huy things of all kiitds to xuil materials. 
their fancy, with but a secondar)' regard to their powers 
of wearing: so that in all kinds of clothing and furniture 
is every day more true that it is the patu-m which sells 
ic t-bings. And, so great is tJie hold whieh French tAste 
on the average consumer, that many English manu- 
fafturem whn hold their own against the world wmild, it 
is said, be driven out of the market if they had to depend on 
Gngludi patterns. This Li however partly duo to the fact that 
having got the lead in fn^hiond, a Parisian design is 
ely to be in harmony with the (joining fashions and to sell 
Iter than a design of eipint intrinsic worlh from eWwhere. 
neh de.tigner>i find it best to live in Pari*: if they 
stay for long out of contact with tJie central movements of 
lion, they seem to fall behindhand. Most of them have 
educated as arti^tt?;, but have failed uf their highest 
sou. It is only in exceptional ea^s, as for instance for 
the Sirras China, that those who have snececded ws urttsts 
find it worth their while to design. Englishmen can hold 
their own in designing for Oriental markets. There iji also 
loe that the English are at least eiiual to the French 
u. IS 



27i 



THE SCPI'LT OF XABOCR. INDUSTRIAL TRAIKIKa. 



»0OK IV. 

on. VI. 



The bleher 
Iraucbi-H 
ol ut dti 
IJOt InlKiiir 

great djsul' 
VMibtgo* 
MOie 
lowar. But 

not >1ik» lu 

«onuiuu>f1 

jiroiMrtloii 
«f the but 




iu oripiimlUj, though thoy iirt* inferior in qiiickness in 9«ein(f 
how to gtxtup forms and coloum so as t-n obtain an vfTcctm 
result'. McoQwhile in Engkud we are ^ving more attentioii 
to &rtifiticdesigu; there arc tAgua that its rapid improvoment 
dunug the present generotiou will be ccrutinued during the 
next ; aud that it 'n'il) continue to becume purer iu tou« and 
stronger In conception. ^M 

It i» probably true, though opinion is still somcwh^^ 
divided OH the aubjeet, thut soHooIm of artistic dedgn are 
not 80 urgently needed in England, as & more efficient aiid 
cheaper system of pu]m!ttr oduoalion in art proper. For in 
tJiis respect, p(.'rhap« innfrc than any other, the child of the 
English workman has Itws opportunities than his couiinentol 
rivals, and especially chfise of Frnnft*. If we could .wciire 
that all who have a natural turn for it should wceivi* a 
fiurly good education in art. proper, the applications of art to 
doiugn aud decoration might perhaps be left pretty much to 
take caru of thiitn.'ielves. 

The highest branches of art escape many of the dts- 
ailvantage-s under which artistic design labours. He who 
designs a pictun; executes it with hiw own haiidit ; theie 
in not in painting nor even in sculpture that divorce betwaeii 
design aud techuical iamiliarjty with the mat^uial, which is 
so grrat an olmtacle It) tho progress of our metal and wood 
work. But the paiutera themselves have put on record iu 
the port-rait galleries the fact that in niediieval times, and 
even later, their art attracted u larger share of the heat 
Lutelloct than It dot'H now; when the ambition of youth 
id tempted by the excitement of modem businesis. when Ito 
zeal for imperishable achievements finds a noble field in 
the romantic diacoveiica of modem aciencc; and lastly when 
a great deal of excellent talent is inseiuibly diverted from 
high aims by tliu ready pay to be got by hastily writing 
half-thoughts for periodical literature. But oven as it is, 
the total supply of genius of a high order among tbo 
ranks of our artist* is not small. In Borae direction?! there 
is marked ori^uality, as for instance in landscap<i^ pninting, 

> Sm Uie Hiport cnc Terhniei^ Kdueatmn, YoL I. p]i. ajW. 33). 3^1, 33.% antd 
m. pf. ISl. ISt. !10a. ItOi. Ill uill/iiiMi'n. 




IDUCATIOV AS A KATIUKAL IKVESTHSNX 



275 



especially in water colours: white tb& di-v-<_°lopTni>nt of wood mok it. 
eugraviiig in a guod example of the growth of now indugtriei! " '' " " 
which educate the higher artistic faculti(>s of ariisanu. 

Technical t'ducatiuu thoii caunot. ad<i much tlirpctly touuuiciw- 
the HUf^ly of genius in art, any more thau it can in science ,m.rean:u(i- 
or in bu«iue«8 ; but here aUo it can save much natural "^nkal 
Lnniu-s (nun runuini? to waste, and it is called oil to do '^''"''*'" 
■nu all the more because the Inuuing that was given ojiportii- 
by the older funns uf handicraft can never be revived on HJtJBiie'"''^ 
a large scale. Thus the artistic education of ihc lower KIJT^ '/,'"' 
gmdiM uf iadustrj' is nea-'iwBj-y for its own sake, and becaiiw ii"- '""«■'■ 
it ruse8 the tone of all branches of aiauu&cture by increasing 
the demaud fur art proJucts. But itd chief economic value 
ia indirect, and arisen from its couiitfracting the teudcucy 
of luucbineiy to nanow the Bourcee of supply of artistic 
geoiua 

Summing up the chapter, wc may cnnrhide that theTLaln- 
wifldom of expending public and piivate funded on educa- nr^ont* 
tioo 19 not to be ineaeurcd by itn direct fruits alouc. It will ^^i*^^. 
be profitable as a mere inveatment, to trive the masses of the ''""^ '"■ 
people Touch greater opportunities thtm they can gcucrully 
avaU themselves ot For by this many who w<^uld have died 
unknown, get the fitart that is required for bringing out their 
latent abilitica And the economic value of one great i»- 
duHtriaJ genius iit .tuHicicnt to cover the expenses of tho 
education of a whole town. One new idea such as Beane- 
roer'u chief invention adds ok much to Kngland's pro- 
ductive power a£ the labour of a himdred thuuBaud men. 
Less direct, but not less in importance in the aid given to 
' production by medical discoveries such as thosp of Jetmer 
or Pasteur, which increase our health and working powej, 
I and again by »cieutiAc work such as that of mathematics 
I or Inology, even though many genenitiunx may paiw away 
before it bears iHsible (i-uit in greater material well-b<.'iug. 
. All that is Kpout iluriiig many ycant in opening the mean» 
of higher education to the masses would be well paid fur if 
it called uut oue more Newtuu or Darwin, Shakapearc or 
Bcvtbuveu. 

§ 7. There iwe few practical problems in which the 

18—2 



27y 



THE SUrPLV OF LIBOUB. ISOl'STRIAL TBAININO. 



HOOK rr. ecoiiomiHt hiia a niort- iJirei.'t interost than those reUttinjj 
cn^- to the jiriiicipirs .m which the expeuw? of the education ttS 
chUdreii should be dii-idod between the State and (he parvnu. 
But leaving th(?m aside for tho present, wo must cunmder 
the conditions that determine tbu power and the will of 
the parents to bear their ahare of the expense, whalevop it 
ntay bo. 
TlisMcrt- A slave owner or a dog trainer eJcpfiKi."* himself to reap 

parmia tl^^ full pt^cuuiary va1u« of any education ho bcstowK on his 
iiud in a primitivi; society in which the family is 
held together by strong and lasting bond* of ciutoni, the 
father derives nearly as much gain in a direct material 
form from anything that increases the efficicacy of his bods. 
a-s from anything tliat incrco-sea his own. Bwt in modern 
life it is otherwise. Those who bear the expense of a child's 
ethication do not as a rule reap, in a tlirect material form, 
any conaidcniblL' part of tho benetila which will ariiw from iL 
Most parents are willing eiiongh to do for their children what 
their own pareota did for them ; and perhaps even to ga 
a little beyond it if they shonUl find themselves among 
iieighboiins who huppun to havo a ruLhcr higher Htandard. 
But to do inoro than this requires, iu addition to the moral 
qualities of un^elfiNhnrHs and a wamith of affection ihtt 
arc perhaps not rare, a certain habit of mind wfaich is as 
yet not very common. It rcquirea the habit of diKtinctly 
realizing the future, of regarding a distant event as of nearly 



S^cl^'-^Harge 

tinnaf 

their i^hil- 

drou n- 

<ltute l»t(i 

nnwllliih- 

lUH, 



mill Ihi; 
Iiabll ifI 
\'iiluiiii; 



tMt^^''" *^'' eamo importance as if it were close at hand, or to use 



an 



taj^. 



expressive phraae that is something more than an analogy, 
of discoimting the future at a low rate of interest; this 
habit is at once a chief product and a chief cause of civili- 
zation, and is seldom fully develo]>ed except among t ha 
middle and upper clo^se^ of the more cultivated nations. ^H 
Tlicfniure Bill ihuFe It 18 highly developed; the heroic Bacrifiew 
cAtun^Tg^ which Bomp middle-ela'w* parents make for the sako uf their 
children's education are instajices of the latent romance of 
mcxlem life. And a« we shall see later on, the income that 
can be secured by a good educatiou. when it Is bestowed 
on children who have not more than an average share of 
natural vigour, does not bear a very high ratio to 



tiidiiBitj-] 
ntv, 



ROftlZONTAI, AND VERTICAL MOVEMENT. 



277 



Expenses incurred in it. In other wonls the pecuniary 
adv&QtAgee of a higb cla&u vducatiou uro djAcuuntod at u 
moderat« rate of interest; the supply price of ordinary 
educated ability in the middle (uid upper mnkB. thnt i» 
the price that is required to call forth a full supply of it, 
id calculated nt a modi^rate rnte of interest ou the ex> 
pendilure that vcas iucurred for it a long tinm befvre. 

But it is difterent with the less educated classes. Many 
of the«e were inade to coiitribule to the iocomti of their 
parents at an age much below that up to which the law 
DOW comp«U them to koep thuir childrGu at school; aud 
their alfectiou, strong though it may be, seldom suggests 
that tbvy nhould go far beyond the requirements of the law. 
Thus in the lower ranks of industry the atlvantages that 
are lo be got by the child iu ufttT years lu cousL-queuce 
of the expense incurred by it^ parents now, are discounted 
at a high rate of inten-at: the supply price of educated 
ability of the lower gradea is calcidated at a high rate of 
interedb on the expeune ncccMiary lo obtain it. 

In consequence however of the great growth of wealth 
relativeiy to population, and of the mental aud moral 
inipn>%-einciit of the age, there is a rapid full in tlie rate 
of interest at which the fiitnre benoHte to be gut by e«- 
penditure ou education are generally discounted. High as 
it is for the lower claescit, it is net uh high ua it wuti; aud 
low aa it has been for the upper and middle-clasaca it is 
DOW becoming rapidly lower. 
I Bui ihe^e obstacles to movement of labour from any one 

grade to other grades above it, do not hinder movement 

Rtween two occupations in one grade : they hinder vertical 
>veu)eiit, but not horizontal. For indeed the industrial 
^H may be regarded aA so many horizontal Btratu. All 
e occupation.^ in any ono atrntum KHjuire on the part 
. of those of ordiiuu-y ability about an equally expensive 
education and eqnally ditlicult preparation ; ho that iu the 
aheetUM of special circuiUMlaiieeti the tnipply price fur them all 
ii equal. It is indeed true that when a person has once 
dioeeo his occupation he b more likely to uiuve vertically 
horizontally ; he ii more likely to rise to a higher grade 



DOOX IV, 
CH. tl. 



bat UK 
ti>i{h raw 
(uuonK lb* 

grudM. 



of dtotoo 
npcii (0 m 
(aUicr In 
uImUas ■ 
tnnlDfor 
hui fon U 

liurlunEal, 
UuiUKb 

kdia ouot! 
«Uri«diti 
Ht<, vnti- 

niviit 1b 
iDoT« likelj 
lliitii bun- 



278 



THE SrPPLT OF L&BOCB. INDUSTBIAI. TRAININO. 



MiU 



BmnJI 

HiiOTOf 

bctmcn 
indiMtriml 

ti-a'liti([ to 
(Mde awaj. 



in his own Itue of busiuess than to pass to another line 
husiuess in )m owu gradu. Hub most i>qo|>I« stay iu that 
grade iu which they ore placed hy their parents, and that 
is gei»>nilly thi; grade in which tho^ parents thcmselvei arc. 

§ 8. Mill was 9o much impressed by the difficulties that 
beset a jmrent in the attempt to bring up his son to an 
occupation widely different in character from his own, that 
he Beid': — "So complete-, indeed, has hitherto been the 
separation, ao strongly marked the line of demarcfition, 
between the different grades of labourers, as to be almost 
e^^uivalent to aji herediUiry distinctiuu of caste ; each em- 
ployment being ehioOy recruited from the children of those 
already employed in it, or in eiiiployrnentti of the Bame mnk 
with it in social estimation, or from the children of pcrsoji* 
whi>, if originally of a lower rank, have suoceeded in raitang 
themselves by their exertions. The liberal professions are 
mostly Hiipplied by the sons of either the ptxjfetasional or the 
idle classes: the more highly slcilled maniial employments are 
filled up from the auiis of skilled arliHaui or the clan of 
tradesmen who rank with them : the lower classes of skillod 
emploiymentM an: in a similar cane ; and iiuKkilled labotireri), 
with occasional exceptions, remain from father to Kon in their 
pristine condition. Consequently the wages of each claffl 
have hitherto been regulated by the incniasc of its own 
population, rather than that of the geni^ml iK>pulation of 
the country." But he goes on, "The changes, however, now 
so rapidly tuklng place in usages and ideas, are undermining 
all these distiuctiouti." 

Hia prescience has been vindicated by the progress of 
change wnce he wrote. The broad lines of division which 
he pointed out have been almost obliterated by the rapid 
action of those causes which, as we saw earlier in the 
chapter, are reducing the amount of skill and ability required 
in some occupations and increasing it in others. W« cannot 
any longer regard diHFcrcnt occupations oe distributed among 
four great planes; but we may perhaps think of them as 
rosembling a long flight of steps of unequal breadth, 




MTLLS FOUR ORADBS. StTMHABV. 



279 



being 8o broad a« to act as lauding; stages '. Or even book it. 
betl«r still we might pictiire to onrwlveji two flighw of fttaire °^" ' 
one represeuting the "hard-liauded iu<liwtri«!i"aud the other 
"the wjft-haoded iiidustrifH ;" because the vertical division 
between these two is in fact as brond and m clearly markud 
as lliu horixoutikl divLdon between any two grades. 

But we muat defer to a lattr stage a fuller diacusnion 
of the ulutaclcti which the conditiouH of any place and time 
oppoee to the firee mobility of labour, and also of the iuducc- 
uientti which they offc>r lo any one to ehtuige his occupation 
or to bring up his son to an occupatioo different from his 
own. These iuduoeincntM we have spokeu of as the price 
otFered to labour; but it is obvious that they are uot to be 
measured exclusively by those direct money payment* to 
which alone the name of wages b generally giveiL Every 
occupation involves other disadvantages besides the fatigue 
of the work required in it, and every occupation offers other 
ailvantages besides the receipt of money wages. The true 
reword which it oSeni to labour has to be calciilated by 
deducting thf mouey value of all its disadvntitages from 
tbat of all its advaul-agtss. It wil! be convenient to introduce 
here far immediate use a term, the fiill signiiicancc of which 
win be explained later on, and to describe this true reward 
rhich an occupation offers to labour as it« Nkt Auvantaoer 

We may now sum up the reHultH of tbiu and the Summrtr; 
3ing two ehaptem, A tempi'ratc climate keeps the thrw 
th of a generation fairly long, and generally jirevents ^„ fi,^ 
both birth-rate and death-rate from being very high. It is ^,"1''!^*',^ 
&Tourabte to vigour and the power of sustained exertion; 
but it causes a great part of the energies of the people 
to be spent in providing the necessaries of life; and thus 

■ Thn* Uill't cUaaUlMlloii luul lout • KTOkt fit ct lU Itiaa «htu CkiriMa 
■dOlltvd tt {LeaMnp Priiuiplr*. p. 72). A dumifltaUuu more UUlttMl to uur eiist- 
I wmKttMw i* oflared by Mr (Miliuui {FMlieal Setenet QHOttt'ln, Vol. ti. pp. 
71 >. It ia ojMii to bla ohjoctinn tliHt il ilnin'it brniid lm<!M ofdiviniuu >liere 
IMvv Imt inadc no hroAd liiM* : bat it in pcrbiipii as gimil im niij iHvimuii of in- 
intrj bMo fmr gndts can bo, Eis ilnuilou>«t« |i)un(mM(tein«)»i<>"alNTii>', 
hrhriing coiamou Uhonivn wul tnorlitni? UmAen ; lii) rttpoiuibh nanuat loAow 
tollri'nif llioiii Itlta can be hjiIthhU^I wnli xomc rritpoii.iiliilitjr uid Intmar of mU- 
VnrOtmi (IH) aUwuinV bmtn iporlicrt budi u booU«r[wri bdcI (it) rripoitMU 
IvflM morktn, tndiiiliiig Uw npointatdBiita mA dlMCton. 



280 



THE SUPPLY OF LABUL-U. UiDUSTRIAL TKAJNtSia 



BOOK IT. 

crt. VI. 



seldom allows much intellectual achievement till after' 
guud dtal of material jtmgress hns been made. 

The habits of the peuplo buth as to their marring 
in their uiarriagL-, a.ffc?ct birth-rate Hirectiv aod denth-r 
indirectly. The chief caust's by whicli these habita 
intlueuced are climate, ruligiotu aiid !i<>cial satictiww, the 
excess of their own iocomes over what thtir habits aiid 
*' stoiidurd of comfort " lead them to regard as ueedful for 
their subsiatence and their expectation of Ix-'hig able to iitart 
tbi^ir childruu in life eusily. Children are hardly any biirdeD 
when they can add at an early agv to the family incon^^ 
whvthLT ill money a^ in n factory town, or in kind ra on tfl^| 
farms of a new country. But when the modt- of living is 
such that purL-nt« have to furnish their children with a capital 
larj^e in proportion to their own ineana, then every sdditioo&l 
child involves a gruit strain on the resources of the &nnily. 
Among peasant proprietors this cause combinc-d with the 
prefcreiKo which is given to hoircascs tcads tu ke«p tlit- 
families fjenerally small. On the other hand the vigour that 
works it«( way up into the middle clfu»c» in England, assstd 
tho prevailing Bocial habits nf the class in preventing the 
families from being very small iu spite of the feet that their 
marriage age is kept late by the greiat expense of oducAtinga 
Jamiiy. The social Banctions, and in some eases the religious 
eanctionswhichaffect the age of marriage ore in agreatmcttsure 
the abstract of the oxperiouce of the people a^ to their power 
of Riipportiug increased numbers; and these sanctions often 
out-last the conditions in which they Iiad their origin. But 
on the whole the average ?ixo of families in any pUtoe of 
rank of life is very much under the influence of economic 
causes, and dependent on the incomeit of the people present 
and pnwipective. This dependence is however complex, and 
changes its character with circumstances: a nun in the 
incomett of any claj« cannot be relied on Co cau^e uu iuc 
in the average size of their lamilies ; indee<i it may have 
opposite el!ect If it leads ihem to adopt more artificial mc 
of living. 

But an increase of incomea always acUi directly 
diminishing the death-rate and incJ^asing the vigour 



SUMMiJlT. 



381 



of Uie presont and the ruang generation. It in 
Uiat the iiicicased inoDinc may bo ubtomed at the 
suae of moriog into lowns and adopting wdentor)- 
pureuite; aud the want of fresh air aud light and joyous 
play may iujuro health aad vigour. But, other things being 
<^ijal, ail increase of tnoumo. except in the cas« of thorn who 
are already rich, increases the bodily and intuto! strvQjUith of 
those who earn it, and of their children: it lowers the death- 
mte, it iengthoDs life, it shortcus the time of sekn«ss, and 
thiis it increases the number of people at work, the time 
during which they ore in full work and their efficiency when 
al work. It in no exwpiiun to this rule that when a nominal 
increase of income is got by a mother's going out to work to 
the neglect of her diildreu and of her hoiiiu^hnld affairR, 
tlie re!<u)t is to injure their health and vigour ; for in 
eubRtltuting less inipurtani gains for more iniportaut she 
has really diminisihetl the income of the family. 

Again it luiiKt always hv remembered that the growth 
uf iDst^rial wealth, the increase of the demand pric« far 
labour of all grades, is only one of many causes that aifect 
the supply of labour as regards boch numbers aud vigour; 
for its action is modified by changes in knowledge, in the 
hubils of married life, luid in the modui of expenditure. 
Better housekeeping, greater temperance in the use of 
ulcithul and otht.T hixurit-.s, and loss demro for oocial display 
would enable parents to do better for their families with 
their [iresunt incomes; and again, thu labour-suppurttug 
power of a given national income would be very much in- 
crcoMxl by its more crcn djstribuiiou. if Ihia were effected 
.by cau&eft that did not impair socuhty and discourage energy 
tmad thrift, in &r&ry way the moral and mental atrongth 
of the rising generation depends on the character of tho 
of that genemtion ; it is raided by everything that 
jles women to develop their bigheat intellectual laculties 
truly and womanfiilly. But since moral ami mental strength 
rest in a great measure on a physical basis of uervoufl 
• tfn?Dgth, it is a scarcely less ira|MiTtant comlition that the 
lildreu should be well nurtured; aud this requires that the 
mother should be a skilled housewife and nurse, and that 



POOH IV. 

cn. vn. 



s&s 



TBE SUPPLY OF LABOUB. ISDUSTBUL TnAlNINa 



SOOKIV. 
Die. Ttl. 

SnnuQUT- 




4 



the luatKrial resources of the huuschold should not 
uisiitfit-ieiit. 

The dccadoDce of the old oppreotLcciship aystem, tll^| 
growing rapuHly of iiidustrial aucl social change, the iu- 
oreauting use of machinery, and the ever widening »angH^ 
of science and the arts of pnxluctioii. all theetf causes com[^| 
bine to increase the urgency of improvement in our svstenui 
of education "both geueral and l«?chiiical. This is all llie 
more important because the social and industrial changes 
of our time are blocking up sonic of the old paths by 
wliicb lads of great natural ability might rise to 
tinction in spite of the poverty of their partmts. 
poverty of parents is a great obstacle to their giving tht 
childniH a start in life very different from their own: 
independertly of the 7natcrial difficulties in thi-ir way. the 
narrownesa of their lives makes it difficult for them 
roalizv vividly the distant future, and to go o\it of th* 
way to make proviaion for it. 

Speaking generally the rate of intcr^t at which parents 
discount future benefits for their children is governed by 
their afiection and unselfishness; but this being given it 
falls with every increase of their material means and of tfa*ir 
general enlightenment. Parent-s generally bring up their 
children to occupations in their own grade, and therefore 
the lotjul supply of labour in any gratle in one generation 
ia in a great muasurt determined by the numbers in that 
gmde in the preceiling generation. But within the grade 
itself there is greater mobility; and if the net advantages 
of any one occupation in it riw above the average, there is a 
quick inEux of youth from other occupations into the grade. 
The vortical movement from one grade to another is seldom 
ver^ rapid or on a very large scale; but, wbuu the oifl 
advantages of a grnde have risen relatively to the difficulty 
of the work required uf it. many small strtAms of labour 
both yotitSful and adult will begin to 6ow towards it ; and 
though none of them may be vtfty large, they will together 
have iL suflScient volume to satisly before long the increased 
demand for labour in that grade. 

In short, other things being equal, an increase in 



SUHUABT. S83 

earnings that are to be got by labour, increases its rate of sooe i*. 
growth ; or, in other words, a rise in its demand price ° "'™ ' 
increases the supply of it If the state of knowledge, and Snmmuy. 
of social and domestic habits be given, then the numbers and 
vigour of the people as a whole, and the numbers of any 
trade in particular may be said to have a supply price in 
this sense, that there is a certain level of the demand price 
which will keep them stationary; that a higher price would 
cause them to increase, and that a lower price would cause 
tbem to decrease. 




SCOX IT. 
CB. Vll, 

Ftiniii of 

wr«ltJl 

UaoDg 

harbA^ono 



Fonsa of 

WMllth III 

tinii. 



^ 1, The earlifst forms of w(?alth were probably inipl 
nientii for hunting aiui fishing, and penion&l ornameiitd; nud 
in cold countries clothiug, and huts'. Ihmng this stage 
the dnmcstioatian of aniinals began ; but at Hmt they 
wore probably cared for chit-fly for their own sake, because 
tnhcy were beautifiil, uad it v/tiA pluoKant tu hare them; ihcy 
were, like articles of personal ornament, desired because of 
the immediate gratific^tiun tu be flRrived from iheir posses- 
mon rather than as a provision against future needs'. 
Gradually tlic herds of domeBticated animals increas^il; and 
diiniig the pastoral stage they were at once the pleasure 
and the pride of th«ir pwiaussors, the outward emblems of 
social rank, and by far the mo»t important store of wealth 
accumulated as a prwision againat future needs. 

As numbers thickened and the people settled down to 
agriculture, cultivated land took the first pluce in the inven- 
tory of wealth ; and thai part of the value of tho land which 
woi due to improvementB (among which wella hold a con- 
spicnouii place] became the chief element of capital, in the 
narrower sense of the term. Next in importance came houses, 

' A Hkurt kill aoKt-vetivi- uluilj of tho crowtli of wcftltL in Uv vwlj tutua, nA 
o( tlic iirW n( life tu irfvrn iti Tylor* Aulhrfjiotofiy, 

3 Biuebul (Ki-anofiiir SliiifirA. ]iji. ]e.V-f>) »Sl« quclting Um) CTld«nfW wUck 
Mr Onltoii hui c^IIvcImI oi: (.h« kfxupinR of pet uiiiBtk bj M*IB0 Wtwa, fetam 
ont tilt we Bud lioc u ^iioa iUnntmltdUL of the furl eiat hcmcvM- CArcbn ft t.y*^ 
TVX iiiaj V (urtlii- fiituni, il r an iiot avoid tntltiiiH •oiuv proviiiou f ar it A lanw. • 

llHhinK Dc!t, which wfll ilo iu work well iii 8<-'tt>iiK (wjd te l«-4v. "HWt *• <* 
•ervtoe (cr mfmy tlayi to couib : a horw, or • camw Uul will tmny on* w«U l«-dv> 
miwl tw K atond ap MDroo of many lulara eiijuymvuU. Thn Icut prxnlilctil <4 
bubado dMprta may niM a iiiuslvo pllv of hnildiiteB, Iwcauw St b ibe moat 
|iftl|i«ble proof of lii> preMDt woalth And poirw. 



EARLY fORMS OF WEALTH. 



285 



ioine«iticat€d animaU. a»d iu some places boats and ships ; 
but Ihu unplcmi.-iit& of production whether for usi.- in agri- 
culture or io domestic manufactures reiUAitted. for a Loog 
tira<- of little value, lu some places bou'cvcr precious stooee 
aiKl the precious metals in various forms became early a 
leading object of desire and a recognized raeana of hoarding 
wealth; while, to say nothing of the palaces of mouarchs, a 
large part of social wealth in many cnmpamtivply niclo 
civilizations took the form of edittefs fur public purjioaes, 
chiefly religious, and of roads and bridges, of canals and 
irrigation works. For many thousauda of yeaw these re- 
mained the chief foniis of nmimulatcd wealth. In towns 
indead houses and housphold furniture took the first place, 
and stocks of the more expensive of raw materials conntAKl 

for a guod deal; but though tlw iuhabitauta of the towns had 
i^n more wealth per head than those of the country, their 
>tal uumbera weri'^ small; and their aggregate wealth was 
ver^- much len^ than that of the country. During all this 
time the only trade that used verj* expensive implemenls 
was the trade of carrying gftods by ivater: the weavers' looms, 
the husbandman's ploughs, and the blacksmith's anvils were 
nf dimple coniitruction and were of little account beside the 
merchant's eliips. But in the eightceuth century England 
iQaugiirated the era of expensive! implements. 

Tho implumeutfl of the EngUsIi fiumer had been rising 
slowly in value Ibr a long time; hut tho progress was t|nick- 
ened in the eighteenth century. After a while the use first> of 
water power and then offitcam power caused the rapid sub- 
stitutiun of expcnsire iiuichineiy for iuexpeusive hand tools 
io om: dcparlmeut of production after another. As in earlier 
times thf motit expc^nsivo implements were ships and iu some 
eases canals for navigation and irrigation, v> now they arc 
the means of locomotion in general; — railways and tramways, 
Js, docks and ghip-s, telcgmpb nud telephone systems, 
id water works: eveu gae works might almost come under 
a* head, on the groumi that a great part of their plant is 
voled to distributing the gas. Alter the»c come mini>i4 and 
iron and chemical works, ship-building yards, printijig 
[tmmitw. Bad other large facU>ries full of expensive machineiy. 



noon IV. 

Clf. VII. 



Until 

niwnlly 
tlitmirH 
litUvnM 
nf nncn- 
kIvc (onns 
.■( itTiiilutrx 

(■SI<lt4L 



Batlu 

recvul 
rc.tr* Ihcjr 

uarn iu- 

v«i7 laaU 



286 



THE GROWTH OF WEALTH. 



WOT IT. 
CD. Vlt. 



r 



On whichever side we look, we find that the progre« i 
diffusion of knowl^ge are coustaully It^adiog to the adopUon 
of new processes and new machinery which economize htiini^H 
oflbrt on cotiditlciu that sonn; oi' thu effort is aptut ii giwa^ 
while before the attainment of the ultimate ends to which it 
is directed. It is not easy to measure this progress exactly. 
bocaiiHU many nxiJcm industries had no connlrerpart> in an- 
cient timea. But let \ib compare the ])aat and present ctni^^ 
ditianti of the four great industriiM the products of whid^l 
have not changed their general character: viz. agriculture, 
the building, the cloth makiog, and the carrying tmdcs. Ut 
the first two of these hand work still rotiuns an important 
place : but even in them there is a great developemcnt of 
expeiuive machinor)'. Compare for instance the rude inipl^_ 
meats of an Indian Ryot even of to-day with the eqnipmeO^I 
of a progressive Lowland farmer'; and consideT the brick- 
making, mortar making. Hawing, ]ilaning, moulding and sic 
ting machiu(>9 of a modoru buildtjr, his st-eam cranes and 
electric light. And if we turn to the textile trades, or 
least to those of them which make the simpler products, 
find each operative in (."^iirly timas content with implement 
the cost of which was equivalent to but a few roantha of 
labour; while in modem timeK it is estimatetl that for encTi 
man, woman and child employed there is a capital iu plaut 
alone of about X200, or Kay the equivalent of a yearx' labour. 
Again the coat of a steam ship is perhaps equivalent to 
labour for ten years or more of thost; ivlio work her; while 



1 



> Tliu r*iiLi iiu]i1<fiiieiiU t<ir « Cm cUm Kyol lamllj. tnrliulifts sii oracrrui 
idalt nuloK lui) n f nw littlil plaHKli* ntid liw* rliiWly iiT woml, of tbe total Tain* of 
ubonl 13 miwciii (Sir (f. I'liiMir, Ary.ft Vilfoflr. ji. -ai) or thp aiiiilTmlMil a( Uicir 
votk t<3r iHmnt a m<™i.U; whilo tiis rilup at the rn»tbintry alono <in a "•U^^ 
C<|i.til'|>cil liU)!o niixlvni nrabln f»rui aiiiuiujl« U> IfS a» acm, (AjtrtfiDirid •>/ lIl^^M 
/'urNi, cdltul bj J. C. U'orttia) or w; * feu's work (or «acli prnua i)iii|Ja;«d^l 
Tbny inclniln fiUani cnciiiM, tnaioli. nbwiti niul unlbarj' plaofcb*. aooM to be 
wurkeilljjBLviuuauil mmuv brticmopomnr; v&rionit gmlilMn, karroira, NJlonk okd 
oninhrnt. anul iu»l nuutnra drilli. hnrim bnni, mkea. bn; luaUiix, vacntbtg Bud 
ivb]>1ji^ iiiaohiiiL-t, ittvaai «r banv tlnvHhln^. chaff mttiii^. Ciinii|i enttiiif, h»j 
Iirwwliijt Kuu^liiii^ tuii It iimlUtuttc nt othera. Mauiwhila ihuN fa ui Inert iriiif 
use of hHqs nud coi-vrvl jatdit, and coualaiil uii|irurviD*!iiU in lb* ftlUiiHS ol tb* 
(Uiry anil vUitr fartu boil lilies, all ut 'n'kicb Kiva gtviA •conmny «f affwt fai (b* 
tuiit; mil. trul require ■ larKf^r lOiiui' cut it to bv ainul in prtpariiiK tlic iraj I nrlh* 
rlir«ct wcirk ol ibe lanuer In raliLnjt asricultiiral jiroiliin. 




n 



w. 



artificial lej^ aud pai-liaiai-utary oxpeuses wblch bavo been 
heaped on themlocinivalent to the work for more than thirty 
ears of the 14l>,000 pyople employmi uu thttiiL 

As civilization has progrciwed. man has always been Ami ih»y 
developing uew waiilH, aiid nw ami niort* expeiuiiv» wajrs of i<> l-uuIIuim 
gratifying thom. Thi? rate of progress has sometimes been '"'"'"*"*■ 
slow aud ou?a?uoiially there has even been a great retrograde 
movement; but now wi- are moving oii at a rapid pace thtit 
growa quicker every year; and we cannot guess where it will 
stop. On ever)- nidf further oponiugs ore sure to offer 
lemselves. all of which will tend to change the character of 
Our Hocial and tudustrial life, aud to enable us to tuni to 
account vast stores of capital in providing new gmtificntious 
and uew ways of ecoaomijant; effort by expending it in 
auticipalion of diiitaut wauts. Tlieri^ seems to be no good 
reason fer believing thai we are auy where near a stutiouary 
state iu which there will bv no new impurtunt wants to be 
satisfied; in which there will be no more room for profitably 
investing present effort in providing for the future, aud in 
which the accumulation of wealth will cease to have any 
reward. 1*hc whole history* of man shows that his wantA 
paiKl with the growth of liis wealth and knowledgt-'. 



I For iniiUinri' ini]irov<4ii£titiwbicIiluVi< ivohiiIIj 1>i>p[( iiiajU in lunio AtiinririiTi 
CJtia* MlMti; that bj ■ vnfllcimt milliiy of ca|iilnl mclj liua>c coulrl U- eapplic<l 
with wbat tt doM roquixe, tad rdlcviul i,t nbat il iIiwk nut, iiiui-h luun' olTwthrljr 
UMn MOV. lo ■* tn ntwliln m bis> pwt tit Iho iH)|inliitian to lite En town* aiiil jvt 
W tlM3 tram iiiiiij ol the iveaMil n*1U iif b>«ii life. The CM Hte]i Is Vi luaki^ 
■adaraO tho utrvcU Ursa laniieb. iu wliicli mnujr pipoa and vizva qui hp laiil 
■iiU lij id4r. *iiJ n-iAtrnl, whirii tliuy g«t out ol ■u'lltr, *ril1iont aa^ ial«trupUou 
ol Uic gvuaal Irkfllc uitl v-itiiont jp-pnl ciivuie. Muiivo i^wvr auA ^mmiUj 
>rai itmX ni^l Ibm bu smeratol at gnat dintAUDm ttnrn tlie torniin, )ln Kimr 
CMM •! the bMUnn of ooal mluea.) ■nd Ud ou wliervivr wuitml. tKjft nalor uiit 
■prinii mUa and pariupii vrnii aoi wbUt loiitht l» litiil mi iii vaparnti* pipn to 
atattj «vei7 bmute: vliDii iit«H,m {itpra mlsbt \tv ii.kisI lot living .wamith Iu 
vuttMT and toofm rn ili *It fat tammitig the li««t or Aummnr : or tbt h^t niftbt 
bv vopiibwl hy yM iff |Erv*l henliiii; jictnvr l*ir) utt In mjivcijil |J]j>4»i. wliil** 1l)cl'l 
vat ilcnvo)! tntln Ku apociallj iiiit«d tar Utr puipraip, or fnim rlcctriiit;; mnil 
*w]r haam luiiclit br uj cleclric couimnnicaljoii nitli Otn nsl ot Uie ttxrii. Ail 
iHi«lKtI«Mnw nj/aan, tnclniUnn tlio«e given off by any dnmPHllr drvui whirJi wn> 
Mill B—4. Hi|^ tw caniHl avaj lij iilriiui; lirauglitu tlmiasli long cutiilalU, U) Iw 
|«ri&«4 T>j fMali^ throia^ lar|t« hmucM ami tiutux awa^ tlunugb bngo 
»lifc»iMy » into'llM Unbar air. To carry out aneb n achmiM iu the t«irn* of 



2S8 



THE QROWTH OF WEALTH. 



MOtlV. 

BH.TO. 

And fluui' 
wtaUDtlme 

ftad piMlia- 
bly liill !)□ 

iiii.T«Mi< in 
Ihe power 
W aocotun- 
ktf. 



Auil witli iht 



rthof 



IKIUC- 



teq^ 



TImj wclBb- 
tne (rf 
ruture 
benefits 

praaeutwu 
tlioducil 
mutivi^ of 

uioliiiiini 

inodoTU 
nerny. 



Openings for the inveatimint 
capital there is a runsUuit increaaa in that surplus of jinxluc- 
ti(»D over the uect.-Msarifi* of life, whicli pvc8 the power to i 
When the arts of production were nide. there was very 
Hiirplus, cxcL-^l whvru a stroug ruling raca tccipt the sufajt 
mftsses hard at work nn thi? bare neceaearies of life, and in a 
climate in wliich thosti nece^aarieti weru small und oasily 
obtaitiefi. Hut ev«rj' increase in the arts of produc^<^^ 
and in the capital accunitilatod to a^Lst and support Ubt^f 
in future production iucreasod tho suri>hi8 out of which raoK 
wealth could be accumulated. After a time, as we ^oa^ 
seen', civilization became po^iblc in tcmpcratd and cveqi^l 
cold climates; the iucrL'ase of material wealth was possible 
under conditions whirh did not enervate the worke-r. and did 
not therefore destroy the foundatione on which it ro«t*^l. 
Thus from step to step wealth antl knowledge have grown, 
and with every bIu|) thy power of tuiving wealth and exti; 
ing knowledge has iiiereoHed. 

§ 2. Thu£ we see that till recently land was the only 
very important kind of wealth from which its owner lottksd 
to derive a rf'vt-uuL'. He laboured hard to make things, or 
he stiuted his consumption in the present in order to save 
things, or he engaged iu piiblif! or private war to appmprifttc 
things, which it would be ]»lea.s8.nt for hira to have, and which 
would alTurd him iuiinediate gratification; but the whole 
auxiliary capital in the wi)rld was Kmail if we except the land; 
and was very small if lu addition we except the live stock 
on it. If a person were in doubt whether he would give up 
a present pk-asurf or undergo an extra fatigue in onler that 
he might get a better house, or better clothes, or richer 
ornaments, he hud to weigh in the balance the plea^tureij of 
the present agw'nst those of the future; and human nature 
being what it is, he probably seldom prcfem^I the future 
pleasures to the present unless he expected them to b<: much 

ICtiglnuil iruulil r«qtiir« tlie ODtlsy of a mndi Itrser rkptlok Uuu bam b««i •hwirbed 
bf nni- miltfikT*. Tbts ooaJMitiLrn u to th4^ nlttioalc eonrw at Uvn impniTMniiDl 
UMj bo iviiii] i>[ till' truUi ; tiiiL It iH'rviiii C» iuilivHlt uu** oi VM7 nMiff waja in 
nliltli Uiv «xp<TLi>]i<.'i.' (if UiQ |>ut lur««bB(luni bro«d opmingi lav linwllim iwiminl 
eSott ill iPTuriaiiig lliD oiiMim vt t»Uafjrius uur nuito iu Iha AitBn. 
1 Bk. I. Cb. u. 



THE WBIQHmO OF ftTnTRE ASAHTST T^ESEKT PLBARTTRRS. 



SS9 



a ere 



IT. But that is alt we can say: there wan {^nerally no dock iv. 
eoacc motwy meagLiiv of what he gavo up on tho out' haad, ''^' ™' 
and what he ubUuiit^d Ui exchaugt^ for it un th« other. 
Gradually the b&bi& of makiog commodities for sale increased, Bai iii» 
and the amouut of auxiliary capital used in production in-^i^„,i 
creased too; and with thij* double change people got into the wljl)^^' 
ly of miUdng their caJcuUtions as to the goimi of saving 'm wwoj l«i 
an arithmetical form. When a prince wautefl tn fiirej>tall of mi^nr- 
aomt- of hill future rfventies h« burrowed perhaps a thousand nl»ii,!f',if 
ounces of silver and undertook to pay back fifti-tti hundrt;d ^hl;"^!!;."' 
at the end of a year: there was however no perfect eecurity '■'"" '' 
that he would fulfil the promise ; oud pt-rhaps the Icndur I17 ibe iu- 
vould have been williitg to exchange that promise for aii^ni,])^, 
absolute certiunty of nicuiving thirteen hundred at the end ['^J^,!^''" 
of the year. In that case the nominal mte of interest would niom-y. 
be hfly per cent., and the real rate thirty. This habit once 
started, the same sort of calculation would bo mode if the 
loon wore armnged in terms of miscellaneous goods; those 
lent and those retumod would be reduced to a common 
measure in terms of silver, and the rate of interest calculated 
out 

This change in the Form of the income derived from Tiin 
til has been aocompanied by the development of an HuXm 
organized market for the loan of capital, or m it is commcmly JCIijIj',';^",^' 
the Moaey-Diarket. The funds available for loan at i"*"* 
ly one time are rapidly increoiting with the growth of 
th and the prevalence of subtler forms of business organi- 
But they are even yet small in comparison with the 
value of laud, buildings, aud other old-&shioned forms of 
wealth. 

§3. That sacrifice of present pleasure for the sake ofThPIK>ll^ 
future, which is the chief cauiie of the accumulation of wealth, Jj'^iifl' 
has been called abstinence by economists. But this term ha* ^jj™ ^^ 
betin mifiundenttood: for the greatest acciimulatoni of wealth itf"cn|UT. 
arc very rich persons some of whom Uve id luxury, andui««i»H- 
oertaioly do not practise abstinence in that sense of the term '^\\i,, hat 
in which it is convertible with abstemiousuesM. What econo- J.'^H^^ 
mists meant wan that when a pemnn abt^taine^t from consuming 
anything which he had the power of consuming, with the 



290 



THE GROWTH OF WEALTH. 



BOOS TV. 

cn. vu, 

il la In'ttcr 



Tie olow 
Bii'l flirul 
difretui'i- 
tnctit of tliu 

tiKbil 111 

Sir<ini9l]i|2 
ar tJiD 
futllK. 



purpose of increasing; his resources in the future, his at 
iiE^rice fmtn that {larticular act of cnnsiimption incrca-sed tlie 
accumulation of wealth. Since, however, the term is liabl* 
t<> be misiinderjitood, we may with advantage avoid its Ofl^ 
and 8ay that the accumulatiou of wealth is generally the 
result nf a postponement of enjoyment, or of a waitivg for it*. 

It. matters not for our immediate purpose whether tie 
powLT over the enjoyment for which the peison waits, WM 
earned by him direclly by labour, which is the original 
source of n<iarly all enjoyment ; or was acquired by him 
from others, by eschouge or by inheritunce, by legidma»e 
trade or by unflcnipulous forms of speculation, by spoUatioa 
or by fraud: the only points with which wc are just no* 
concerned are that the growth of wealth involves in general 
a deliberate waiting' for a ploastiro which a person has (rightly 
or wrongly) the power of coramaQding in the immediate 
present, aud that hia wilUngnesa bo to wait depcuda oa hts 
habit of vividly rtaliziug the future and providing for it 

This habit of distinctly realizing the future and prorid- 
ing for it has developed itself slowly aod fitfully in the 
course of man's history. Travellers tell hh of tribes who 
might double their resource* and enjoyments without io- 
creasing their total labour, if they would only apply a little 
in advance the means that lie within their power and their 
knowledge ; as for instajice by fencing in their little plots of 
vegetables against the intrusion of wild animals. 

But even this apathy in perhaps less strange than the 
wastefutuoss that is found now among some clasBee in our 
own country. Cn-tes are not rare of men who altoniate 
between earning many pounds a week and being reduced to 
the verge of starvation: the utility of a Hhilliug to them 
when they are in employment is less than that of a penny 



> EktI Uktx and bji tollowent liara found much atntuantnt in oontamplUiii 
tlio aopuiuuUtluus of tvL'altU irUdiTMiillfroiuUieBbstliieiioeot Bumi BoUimUUL 
nbirJi tbi>f miiCnut witli thn iniLr*r«[;Mttu at ft labonwr who (aotb « (un^f rf 

Bi?vi.'ii oil ai'Trti sbitliD^H s -nocb. mill living up te luK full i iirotac. pmotiM* ■• 

ccwioniic alHituiriK'* at all. That pari of acctumtlatsd iT«altL which Moaiato of 
intcrcBt uu pnivioiin aoaamalatiDiui stMuls iBileod un a aunicitbat diCorant fooUai 
from Uwrcst Dut lliopnliito wfatebarcHpcvlal lo It will be beat conaEdend wtm 
vru eniuD to diacnm tlia jiart yiMch inlumt playa in tho DJitriljutiaD of tnallb. 



THE SLOW AXD FITFUL OHOWTH OK HABITS OF SATUIO. 



291 



they are out of it, aiid yet they never attempt to make boor it. 
jn for the time of nocd. At the opposito extreme " "' ^" ' 
there are mifiera, in some of whom the pasoion for saving 
borders on insanity; while even amrnig pensant propriotors 
ad Mme other clatsea, we meet not mifruciueiitly with peojile 
rho carry thrift ko far as to stint ttiemselveit of necesBttricB, 
and to impair iheir puwer of future work. Thus th«y lose 
every way: they never really "lyoy We; while the income 
which their stored up wealth liriii^ theui, h \vsg tliau they 
would have got from the increase of their earning power, 
if they had invest-Bd iu ihcmst-lvtis the wealth that they have 
Accumulated in a material form. 

In India and to a leas extent in Ireland we fiud people 
rho <Ia indeed abstain from immediate enjoyment and save 
up considerable sums with great self-sacrifiee; but spend all 
their sanng:!^ in lavUh festivities at funerals and marriages. 
They maku iiLt*rmitluut proviaiou fur the uoar future, hut 
searcoly any punuaiumt pmvisioii for the di»tatit future: the 
great engineering works by which their productive resources 
have been so much increased, have been made ehiefly with 
^0 capital of the much lees gclf-dunyiug mcu of EuglLshmcn. 
Thus the causes which control the accumulation of wealth 
differ widely in different countries aud difterent ages. They 
are net quite the same among any two races, and perhaps 
not even among any two social classes in the same race. 
They depend much on social and religious sanctions; and 
it is remarkable how. vfhen the binding force of custom 
has been in any degree loosened, diflcrcnces of personal 
character will cau$e neighbours brought up under like 
conditions to differ from one another more widely and 
more frequently in their habits of extravagance or thrift 
than in almost any other respect. 

§ 4. The thrifllessness of early timea was in a great s««nitity" 
easure due to the want of Hucurity that thoso who made at MtinK. 
jvisdon for the future would enjny it: only thoiie who were 
already wealthy were alruug enough to hold what they had 
saved; the laborious and self-denying peasant who had 
heaped! up a Utile store of wealth only to see it taken 
from him by a stronger hand, was a constant wamiug to 

ly— 2 



CH. TTI. 




tocntmy 

giroa UP"- 
tamiila- 
tliwis to 

viLikva- 



his neighbours to enjoy their plcostirc and their reet we 
they cuuld. The border couDtty betfroen EngloDd o&d 
Scotland made little progress so long as it -was liable to 
inccRsant forays ; there wbh very little eaviiig by the Frcndi 
peaBatit6 in the last century when they could escape the 
plunder of the tax-gatherer only by appearing to be poor, or 
by those Irish cottiers evon a genoration ago who ven 
compelled i>u many estates to follow the same etnine ^^ 
order to avoid the landlords' claims of otorbitant rents. ^| 

luKecurity of this kind hiw nearly passed away from the 
civilized world. But we are still suffering in England tnm 
the efftjcts of the poor-law which ruled at the beginning of the 
century, and which introduced a new form of insecurity for 
the working claases. For it arranged tliat part of their wages 
should, iu effect, be given in the form of poor relief; ai^^ 
that tbix should be distributod aiuoug them iu inverse p^H 
portion tn their industry and thrift and forethought. Thra 
tUey fouud that to make provision for the future vi^- 
a blunder: and the traditions and instincts which '■<^| 
fostered by that evil experience are even now a grert 
hindrance to the progress of the working classes. 

lusucurity uf this kind also is being dimininhed: 
growth of enlightened views as to the duties of cbe State 
a>ud of privutv peraona towards the poor, is tending to mako 
it every day more true that those who have helped thcm- 
aelvcs and endtsavdured to provide for tboir own fut-are, will 
be cored for by society better than the idle and the thought- 
less. But the progress in this direction remains nlow. ami 
there rcmaius much to be done yot 

§ 5. The growth of a money-economy and of 
habits of busiue^A di>ca indeed hinder the accmuulatioD 
of wealth by putting new temptations in the way of those 
who are inclined to live extravagantly. In old times if a 
man wanted a good house to live in, he must build it 
himaelf; now he tiuds plenty of good houHee to be hirod 
at a rent. Fonnerly if he wajited good beer he must have a 
good brcw-houso, now he can buy it more cheaply and better 
than he could brew it. Now he can borrow books from a 
library instead of buying them ; and he can even furnish his 



.o w. and 
modem 



HOTtVES or SAVIKa 



I9»1 



hoftllQ.hfl it Beady to pay for his furniture Thu« io nooK it. 



VU. 






91107 '**'7* ^ modem s)-&tems of btiyicg aod selling;, and of ' "'■ "^ 
leodiuj; and borrowiufj, and the growth of new wants, lead to 
new extravagances, aud to a subordinutiuu of thti intereiita of 
the future tu tboHd of Lhu present. But on the other hand Bntitluu 
modcmmethodBofbueinoas have brougbtwith them increased iwoiiWwbo 
opportunities for the safe investment of capital in euch v/nya (^raity^for 
&B to yi«ld a reveuuy to pursons whu have no good oppor- i«^n«w w 
tuuity uf engnging in any business, — not even in that offniitniiu 
agriculture, where thw laud will undwr some conditions act ''"'^*" 
as a trustworihjr savings bank. These new opportunities 
have induced some people who would not utlii^rwiiM? have 
attempted it, bo put by something for tbeir own old age; 
And, what has had au iuooniparably grtiat^T effvcl on the 
.growth of wealth, it has rundurt!)] it iar eaMit-r for a man 

provide a secure income for hia wife and children after 
"hh death : for, after all, family aHcctiou Is the main motive 
of saving. 

$ 6. There are indeed nome who find au lutc-nse plcsHiirt> A few 
in seeing their hoards of wealth grow up under their hands, Mm for 
with scarcely any thought for the happiness thut may be J^i"*" 
got from its use by themHctves or by others. They arc 
prompted partly by the instinct* of the chane, by the <lc«ire to 
outstrip thi-ir rivals; by tht; ambition to have shown ability 
in getting the wealth, and to acquire power aud social 
poattoD by its pottHL-Ksion. Aud sometimes the force of habit, 
started when they were really in noixl of money, boa given 
tbcm, by a sort of reflex action, an artificial aud unreasoning 
pleasure in umiiflning wealth for itti own sake. But were it I"ji 
not for the Cwnily affections, many who now work hard and moUT, oi 
save carefully, would not exert themselves t<i An more than j^^ '" 
secure a comfortable annuity for their own lives; either •*«^t'°"- 
bj' purchase from an insurance company, or by arranging 
to speud every year al^er they had retired from work, part 
of their capital as well as all their income. In the one caiie 
,ey would leave nothing behind them : in the other only 

ivision for that part of their hoped for old age from which 

jy had been cut ofF by daath. Thai men labour and save 
for the sake of thoir families and not for themselves, 




S94 



TUB ClRUWl-U OF WKALTU. 



BOOK tV. 

en. viu 



ana 



TliMMnrco 

Inliaii ia 
■larpltM ia- 

wliidta 
diict form 
U tbu 
iDMino 

derived 
(romcapl- 

ul. 



is showii hy the fact that they seldom speud, after til 
rettrtaJ ftimi work, inor<} t'haii tike iii(TC)ni4> that comes in from 
their savings, prt^fcrring to leave their stored up wealth intact 
for their (uiiuliL-ti; vrhi1«> in thiMcmmtry alnnp twenty millions 
a year are saved in the form of iiisuntiiee pulicies aud 
availahle only after the death of those who save thetn. 

A tnau cau have uu slrunj^er stimulus to energy ftc 
enteqirlse than the hnpp nf rising in life, and leaving h» 
family tu start from a higlier.rouud of the socia) ladder than 
that on which he began. It may even give him an oter- 
mastenng pa^sicin which reduces to insigmScaDc« the desire 
for ease, and for all ordinal^' plt'iunun-'s, and sometimes even 
destroyfl ia him all the Huer BetisihiUtiKS and all Doble 
aspimtious. But as is shown by the marvellous growth of 
wealth in America during the present generation, it luakcft 
him a mighty producer aiid accumidator of riches ; unlcM 
indeed he is in too great a hurry to gra^p the sociul poation 
which his wealth will give him ; for his ambition may 
thea lead him into as great extravagance as could have been 
induced by an improvident and melf-indulgent temperament 

The greatest savmga art; mad(; by those who have been 
brought up on narrow means to stern hard work, who have 
retained their simple hiihits, in spite of succefls in businesa, and 
who nourL^h a contempt for showy expetiditurc aud a dcidre 
to be fouud at their death richer thou tbcy had been thought 
to be. This type of character is irequeot in the <^uieter parts 
of old but vigorous countries, and it was very common among 
the middle classes in the rural districts of England for mor« 
than & generation after the pressure of the great French 
war and the heavy taxes that lingered in it« wake. 

§ 7- Next ns to the sources of necmiiulation. The 
power to save dopends on an ttxccss of income over nooos- 
sary expenditure; niid this i.H greatest luuuiig the wealthy. 
With the present distribution of wealth, most of tho larger 
incomes, in this country, but only a few of the smaller, 
are chiefly derived from capital. Moreover, as it liapponod, 
the commercial classeR in Eng1an<l, early in the preKent 
century, had much more saving habits than either the 
country gentlemen or the working elaiwe!). All these causes 



80UBCBS OF SAVINO. 



295 



>inbined to make EoglUh ecoDomists of ^he tost feneration sooi it. 
regard tiaviugs aa made almost excliwively from the profits "*' '^ ' 
of capital. 

But even lu modorn EuglanJ rent ajid the earnings ofBatr»nt 
profeNUonal men and hired workers are an important source mruiu^ »( 
of aocumuI&tioD : and they have been the chief source of Jli^'^'Jmon 
it in all ihu tarlier staofM of civi!ixat.ir>n '. Morenvpr the !""' "^ . 
Ruddle and especially the profeimiouaJ classes have always cri. «re 
denied thenumlTes nitich in order to invest capital in the|uvtuit.M 
eduuatiou of their childrt-n : whik- a great pari, of the wages y'^^Jj^ 
of the working cinases U invested in the ph^fsical health and ^ tak^of 
strength of their children. The older economists took too tai»ii»i. 
tittle account of the (act that human facultiuB ore as im- 
portant a meauB of production as any other kind of capital; 
aiirl we may cimclnde, in nppoMtion t^ tht;m, that any change 
in the distribution of wealth which gives more to the wage 
leoeivers and less to the capitalists is likuLy, other things 
being equal, to hasten the increase of material production, 
and that It will not perceptibly retard the storing up of 
material wealth. Of course other things would not be equal 
if the change were brought about by violent methods which 
gave a shock to pubUt security; but a slight and temporary 
chock to the accumulation of material wealth need not 
necessarily be an evil, even frnm a ]iurely ocono'inic point of 
view. If without violently disturbing existing arraiigcmentB, 
it provided better opportunities for the great nuu» of the 
p(K>ple ; iind if it increased their otficiency and devoln|>ed in 
tbem such habits of sol f-respoct as to result in the growt h of a 
much mare efficient race of producem in the next generation ; 
then it might do more in the lung run to promote the growth 
of even mat«nal wealth than great &dditien.>« to our stock of 

turies and steam engines. 

A people BKiotig whom wealth U well diRtribut*-d, andThepnUk 
who have high ambitious, are likely to accumulate^ a great timw ot 
deal of public property. And the sav-ingn made in tliLs form ,.^,'*'*' 
alone by some well-to-do democracies form no incoiwidfTable 
part of the b«st possessions which our own age ha.s in- 
herited from its predecessors. The growth of the co-uperiitire 
> Ccmp. frincipUM of PoUiieal Kcenomi/. \'y Btcbnrd Jdhn. 



296 



THE GROWTH OF WSALTH. 



IKWKIT. 

Co-upom- 
Uou. 



Ttio iadn- 
pura of ft 
full in the 
ruts of 
iDMnsI <ni 
ac«uiiiuli(- 
Uau ia uul 
■oinjoriaiui 
on wn* mp- 
pORwi by 
lihe earliur 
ecwio- 

IDUltjI. 



movement iu all its mauj forms, of building societies, 
friendly Aocieties, trades unions, of vorttiug men's savings 
banks &c., shows that, even so far as the immediAte aocQ' 
mulatiou of material wealth goQB, the resources of the 
countn,' ore not, aa the older ocononiists assumed, entirely 
lost whon thijy are spmit iu payiug wagea ^M 

§ 8. There is another point on which the doctrines a^ 
tho ulder ecouuuustH were cxpressud with too much aharpnesa 
Founding themselves on the Just observation that a btl i|^ 
thf ruLL' of iutert'st (or, &s they naid, of profit*) is oflen Oa 
iudit^ation of diniiiiiHhiiig jirosperity', and that it alwayR 
diminishes the reward of saving, they went over-faastily 
to the conclusion that a con.<<iderablH fall in that rate would 
dimiuiah the reward of aaviug so muoh that scarcely auy one 
would care to save : they were sure that a high rate of 
interest (or profits) was essential to a rapid accumulatioa 
This concluMuu has nut becu coraplutuly borne out by 
subsequent experience; and it seems to be founded ua a 
faulty analysis. 

It is uo doubt true that when a future pleasure (or rcli 
from pain) is preferred to a present, the rcaacm in that 
latter is expected to be greater. But this result may 
brought about in either of two ways; it may bo due 
the vxpectatiuu of au iiicrea^ in the material source of 
pleasure (such as is repn^ecutcd by a high rate of iutei 
or it may be due simply to the expectation that the n«ed 
tbo later time will bo more urgent than at the present 
When a person puts away eggs for the winter he docs not 
expect that thoy will be better flavoured then than now; 
he expects that they will by scarce, and that thercfors 
their utility will be higher than now. Again, when oar 
forefathers accumulated utore» of gtiineait which they carried 
into the country, when they retired from active life, 
they did not expect the guiuemt to grow iu the chcet is 
which they were kept; but they reckoned that the extn 
gratification which th»y could get while the guineas were 
coming in fast by spending a few more of them, would be i4_ 
IttS service to them than the comfort which those ] 
1 How unlnutiTorUif nn indication it !• w« di»ll mc later en. 





would buy for thein in th«ir old age. The care of the 
giiiueatt cost a great deal of trouble; and no doubt they 
wuuld have beea willing to pay some small charge to auy 
one who would have relieved them from the trouble without 
occasiouiDg them any sort of lisk. 

Nor in it even tnie that an increase in the tiitiire plenRiire In eieep- 
which can be eecured by a given present saerifiee will always cMMabOl 
incretute the amount of present satTifice which pRople will ^ i^iJ^ 
make'. A« Mr Sargant ha« pointed out, if a man has decided '"'■■'»^ 
to go on working and saving till be hatt provided a certain t'""' 
income for his old age, or for his family after hia death, 
he will find that he has io save mure if the rate of interest 
IB low than if it i^ high. Suppose, for instance, that he 
wLihee to provide an income of £400 a year on which he may 
retire ftxim biudnewf, or to intjure £40U b year for his wife and 
cfatldreo aJier hi* death. If the current rate of intL-reot ia 
6 per cent, he need only put by £8,000. or insure his life 
for £8,000; but if it IB 4 per cent., he muat save £10.000, or 
insure his life for £10.000. 
^B Sir Josiah Child said two centuries ago, "we see that 
^^enerally all mercbauta " in countries in which the rate of 
interest is high "when they have gotteo great wealth, 
leave trading" and lend out tbcir money at interest, "the 
gaiti thereof being so eaay. certiuii and great ; whereas in 
other countries where interest is at a lower rate, they 
continue merchants fix<m generation to generation, and en- 
rich themfieU'cs and the state." It is as true now, as it 
waa then, that many men retire from business when they 
ore yet almoet in the prime of life, and when tfaelr know- 
ledge of men and things might enable them to conduct their 
business more efficiently than ever. Thus a full in the rate 



' nib n«atl ur BO* i1«psDilM]t nn th« •xbtmcn tiT ■ mtavj aconoiiDjr. SnpfioM 
f<r hiKUHM Uwt rOliflen bmve lu eel tiiutier ftir lb*>ir trultaKin rrtitu Uie woods; 
tfaa mortt dblaiit Uim* ant, Ibn anftlUr will ha t)io rrtnni of fntnm mmfoii ([ot hf 
tmtinlmy't work i> fnUliiiti; tha wood, ibn tofs vriti b« tlic fuloro iiwDcu of tbe 
wHb •ccnnmlitUd br each lUj't work: wd tU« wUl uo clonbl l«iicl U> pnvcml 
tkMB tram iuoeaaftiK tlifi aizm of Uieir i-i>lla|{Va. But it cuiIoid lua mule iLun 
famfliar >iUi colUc«« ot ciiiljr caic t>.ihiiiii, tite (nrtlinr Uicj mr (riitii tlia vouda. 
uul Ika MBaUor Ui« uawie* (a be ^t troax Uie iiruilDe« uf one lUj'a work, tlie morv 
4Mytf worii will thtj glT«. 




298 



THE OBOWTH OF WEALTH. 



OH, Yil. 



a tui 

■a 



of interest would m some ways prnniotc and not chuck 
production and the accumulation of wealth. 

Althuugb then a &1I iii the distant bcueiitA to be gob 
by a given amount of working and waiting for the future 
doeB in general tend to ditniuiHli ihc pruvi^iL>II which people 
mako for thu future; or in moni Diodem phrasu, though a foil 
ill the rate of interest dovs lu geueral tend to chuck 
accumulation of wealth, yet the tendency is not so stroag 
ttt Urst sight appears; and it is quite posstblo that a 
tinued fall iu the rato of iotereat may be accompanied by a 
continued increase in the yearly additiona to tho worid'^ 
capital '. ^ 

§ 9. On the whole then the accumulation of capital 
■(jEBmwir is govemod by a gri^at raricty of causes: by custom, by 
habits of self-control and forecasting and rwUizing the future, 
and above all by the power of family affectioa Security ! 
a necessary conilition for it. and the progress of kuowk 
and iutelligtsnce furthore it in many ways. 

The "demand price" of accumulation, that ig the ^tDie 
pl>pa£.iire which his Humiuiidings enable a peraon to obtain 
by working and waiting for llic futuro, takes mauy furrm; 
but the substance is always the »ame. The extra picasun 






iture, 
itrlfl 



> Ths (taUiiticiU liiitciiy of Uie urawtli of wealth ia ■iugolailj poui mmI 
n^okadliUE. Ilib ih )iiu-tly Hav tii tliiBcalCa«B uiLcmil iu taj nilmxft lo k^^ 
a namcHvAl ucniitiTi: of n-onltli wliirlj nh*U be appUcaUe to diffcnnt pUoMnd 
timca, iwrtl; Ui Uxe aLi>eiii« uf iiyiittmiacio nttvnipta to coUect tke DBMMNrrfKta. 
Tbu Ijvirom live lit ri( tlin ITntliMl SUU'* rl<ii* IrilmiKL aik tcir rfUmiH <if enny 
pw«aii'*f>Tt>p#Ttyi ■tiid Uioagb th« rt>!inlU Uimi ohtalii«d ar# not wvrj aU'udaetatf 
(•m in j>Brtii'.iilnr, (lonxnil W«Ilii>r'H miiBrlii asx Tki Sl^iitU* of Cofrilal innralwl 
m HMfHtfocturw ill tLc Bopoit «f tbuTvuUi Onaiu, \>VJ.m.), }<i Uivj «ro probkblj 
ou tlia whole llie l^ist >vv bavu. Th«; iijtllcato tliat tbc OMltb per bead row 
ttata 1k; ilaUimi in ITMI tii -i20 cInlUn iu (Ml. uiiil WO ildlara iii IS80, Of Uiia 
liMl Huui alwiit B ((iiaKtir Ih tO. tloini Xa tli«i TfUae nl •erir.allaral Uiiil. alninl c«w 
kilf tftMalprnpiirtyfifotlinr kinilBMidfixnleitjiitaJ. whiloaf tbervauuiiiigqiurtA 
■Iwiil one half IK i>iit to tli# u^ooiiiit «t liont^hoM tnniltnni, Jte. IMyli^ ehMly 
CD Uiv Luitur; uf Ibv <li;klb ilntioti, M. Av FlnJi rcvcutlT t>tbii«t«l tlial tlw W««llh 
p«r hi;ad Iii Pmiici: liiid iiicrcuDd rklwiil fuurColil darinu Uic lost biuiJnd JTMIS. 
Hr ClilTeJi iu a iiLuuunitilo |jKi>Dr ^u tbu itTitwth uf MipiMl iralculatcil. chlfdy tm Um 
lioniii of ini-iiiiin tnx rvluniii. Uiat tbu wniilLli ol thu Unitad Eiagdam r«M tm 
£B,«I3JXW.(I(K) in 1^5 tn fli.M&.OOO.OOO in litll. but miu-h of thu rW vu 
viigriJy iiHiiiiunl aiiil ilod ti> ■ii.tiuiaC«<8 of |)ri>fitH wLiIch wtro tiol jnntifiol hj 
■abwHjUcat cVDutn. Ka inilrQctivc hU lory of chuieeA iu Uiv rdatlTc noaltb'ol 
difknmt puts of EukIiuvI Lbh Iiwd linlucuil hj Prol. Bot<v« fraiu Uw i 
of tlia MV«ra] ooDccim for tlia porpoiep of taiaUoa. 



CONCLVBIOK, 



29 S» 



which tt pwuwnt who has built a weath<>r-prfK>f hut derivea ■ook n. 
from its QStace whilo the enow ia drifting into those of his "*" "* ' 
D«ighboun> who have spent less labour on buikiitig theirs, is 
the pricti ^iriiod by hie working and waiting: aud ia siDiilar 
in ail fuudameiiULl renfiects tu the interest which the retired 
physician derives &«m the capitaJ ha has lent to a t&ctory or 
a mine to enable it to improve its machinery'. And on 
account of the uumeri>cfl.l dofiuiteness of the form iu wluch 
it is expressed, we may take this intereNt to be the type 
of and to represent the usance of wealth in other forni& 

A rise then in the rate of iutereBt. or demand price, for 
AaTing tende to increase the volume of saving. In spite of 
ibe Sfcct that a few people who ha.ve determined to securs 
an income of a ccrtAJn fixed amount for themselves or their 
iiuuily will suve Icsa with a high rate of interest thau with a 
low rate, it is a nearly universal rule that a nne in the rate 
increases the degire to save ; aud it oftcu iucreaflee the pvtoer 
to save, or rather ib ia often an indication of aa increased 
efBcdency of our productive resources : but tho older ccoao* 
mists went too far in suggesting that a rise of interest (or of 
profits) at the expenito of wages always incri»k.suil the |iuwcr 
of saving: they forgot that Irom the uational point of view 
^Kte investment of wealth in the child of the working man ia 
^Hb productive as its tnve«tmeut in huntes or mochiuury. 
^^ It must however be recollected that the annual inveet- 
meut of wealth is u small part of the already existing stock 
and that therefore the sEcick would not be increased per- 
_cvptibly in any one year by even a cousidetable inoreaee in 
le annual late of sa%'ing. 




The 

dnctritiu 
tbnt or- 

iiirre*«ca 
eJHcienty 
Uold: 
bit \(]iun 

SULltb 

gavB it 
iMwlif*, 



uid mace 
Mh ttmc 

■H'dlJlUUUtfl 

worked 
tflUL-lkcr ill 

Um ilillil- 

tliv utrux- 
gle lur 
innirnl 
bu vxvrtcd 
on org*nl- 



§ 1. Writers un social scit^nce from tho tiine of PlaE 
downwards have delighted to dwell on the incrensed efficiency 
which lubour derives from orgaaizatiou. Bub in this, as in 
other cases. Adam Smith gave a new and larger sigiiificnucc 
to an old doctriuc, by the philosophic thoroughnefls with 
which he explained it, and tho practical knowledge with 
which ho illuetnited it. Aft«r insisting on the advantages of 
the di\Tision of labour, and pointing out how they render it 
pOBsiblc for increased numbers t^ live in comfort en a Umited 
territory, ho argued that the prc-seuro of population on the 
means of siibsiKtence lends to weed out those races who 
through want of organization or for any other c&use are 
unable to turn tu thv beot account the advantages of the 
place in which they live, 

Befort- Adaiii Smith's hook bad yut found many readen, 
biologists were already bi>ginning to make great advances to* 
wartU uud»rHtaiidiiig the real nature of the difierenoea in 
organization which separate the higher from the lower 
auinmU: and before two more generation!* bad (^lapsed Mai* 
thus' hisloriral accoutit of man's struggle for existence set 
Darwin thinking as to the effects of the struggle for existence 
in the animal world. Since that time biology has more 
than re|«iid her debt; and economists have iu their turn 
owed much tu the nmny profound aiiHtogics which have 
been discovered between social and espepialty industrial orga- 
ni7Ation on the one sidi?, imd the phip-sical organization of the 
higher animals on the other. In a few cases indeed 




XBB sravofflue for srRviTi.L. 



301 



it annlogiM disappcamd on closer inquiry : but laiiny bms it. 
of those which seemed at first sight ni(»<t fencifid, havo gradu- * "• ^" '' 
ally hecn RUpplemcnted by others, and have at Uurt established 
tbeir claim to iHiLstruto a fundaiii<intal unity of action be- 
tween tile laws of tiatiire in the physical and iu the moral 
world. This central unity is set forth in the general rule, to 
which there an: ntit very many exceptions, that thv di^velop- 
ment of the organism, whether social or jihjidcal, involve* a 
grt-atCT subdiv-ision of functions between its separate part* on 
the nme hand, nnd on the other a. loorc intimate connection 
between them*. Each part, gets to be less and less self- 
suSicient, to depend for its wcll-bc-iug mort; und more on 
other parts, so that no change can take place in any part of a 
highly tlevelopc-d organism without affecting others also. 

This increafled subdivision of functions, »r " diflenintia- DiHracntl- 
tion" a6 it ia called, manifesto itself with regard to induotr)' intngra- 
in each fbrm» a» the division of labour. luid the devoloprneut "°''* 
of specialized skill, knowledge and machinery: while "inte- 
gration," that in, u growing intimacy and firmness of tho con- 
nections between the separate parts of the industrial organism. 
sbowB itMlf in such fonoe as the increase of security- of com- 
mercial credit, and of tho means and habits of oommunicatioD 
by sea and road, by railway and telegraph, by post and 
priQting-pre««. 

The doctrine that those organiixmii which arc the moRt 

highly devetojied, in the netiae iu which we have ju£t uaed 

the phrane, are tho^ which arc most likely to Kurvive in the 

struggle tm existence, is as yet but partly thought out and 

imperfectly established, so &r as its minor details go, both 

in biology and in social science. And without pursuing this 

point further at present, wo may pass to consider tlie mwii 

bearings in economics of the Eaw that the struggle for exis^ 

euce causes tfaoee organisms to multiply which are best fitted 

to derive beneBt from their onvironinont; or, to u»o a more 

familiar phrase, that a demand for any economic arrangement 

will BooQ create u .supply of iL 

* BMldM tb« wrlttnK* ot IlarlKirt SprniiMr nn thin aabJMt, uid B>g«lial^ 
ft^iim a*d PalMct. iwis u briUinitt r>ii«r by Hiu<kel on ArbtibDuilMV 1" 
JKuMCiM wuf ritWcKlf^N. BntvTenM ms; kJao ha mttHo to SidJifflB'l But imd 



302 



ItlDUKTRIAL 0H^A^1ZATION. 



^ 



noox tv. 
en. vm. 

Th« Uwof 

for snmvnl 
risiiuri'B 
tviK can- 
fnllj inter- 
pr«tMi. 



MtttttnrcB 

theprin- 

Itercdllj. 



Nftrnce 

out BUt- 

rire in the 
TegeUble 
at luiimal 
wnrld ill 
wbiiJl (]]« 
piuwibi 
nc^laet I lie 
liitotmitH 
€4 tlii>[r 
oftipring. 



r 



The law requires t-o be interpreted cnrefiiUy : for t 
that a thing U bcuyficial to its euviruumeul will not by 
itself secure its survival either in the phyacal or in the 
ninral worJd. Thy law of "survival «f the fittest" states that 
those orgiimKms tend to survive which are best Stted (jL 
utilize the eDviroument for their own jiiirpo«es; not th(4H 
which are btait fitted to bt-tic-fit the euvirooment, «xCL-pt jn 
8o &r as. hy benefiting it, they raay inerease the siippo^^ 
which they tlerive from it. In order therefore that t^| 
demand fi^r any industrial arrangement may be certain to 
call forth a supply, it must be something more th&u a were 
desire for the arrangement, or a need for it, such as a desire 
on the port of cmptoyi^ fur n share in the managemont and 
the profits of the factory in which they work, or the need on 
the part of cluvor youths fur a good technical education. It 
must be an efficient demand ; that is, it must take effect by 
offering payment or some other benefit to those who supply 
it'; otherwise it is not a demand in the sense in which the 
term is used when it is said that supply natiuully and surely 
follows demand. This eccms a haixl fact: but some of its 
hanihest features ai-e softened down by the principle 4^^ 
heredity ; which causes thoee rvoos to flourish in their c^| 
viruiiraeiit the lueriiburs of which render unrequited serried 
to other membeis. ^_ 

§ 2. Even in the vegetable world a species of plaiu^| 
however vigorous in \\b gm» th, which .should be neglectful of 
the int-erests of i\s deeds, would soon perixh irom tho earth. 
The standani of family and riure duty is often high in the 
animal kingdom; and even those predatory otumaJs which 
WH are accustomed to regard as the types of cruelty, which 
fiercely utilise the environment and do nothing else for it in 
return, must yet be willing as individuels to exert themselveH 
for the benefit of their offspring. And going beyond the 
narrower interests of the family t«» those of thL- race, wc find 
thftt among so-called social animals, auch ae bees and ai^H 

> Liko ali i>ILtir iloctrLies aX tbo MOtc rlnsM. tliiH minlrro M bo llttorfnlcd Id 
tbn light nl thu (aiit tbal tlia rffsati*« dHOiauil uf n iitucliiUMr depands on bin 
mi«iiB. on ^t<l\ <u DH IiIr waiiiti : a small wuit on tlti> pun nt n rirb man ott«D bH 
mar* oBecLivu ItxvK in cuutrolUuu Uio buUieM amLiUjiniittiU uf the world 1 
gr«Kt vnnt on (lio iiut at * poor man. 



THE PRINCIPLE OP HBREDITT. 



303 



cDR survive in which the individual is mont energetic 
ID performing viiried services for the societj without tho 
lirompting of dirwt gain to hinmelfl 

But when we couic to huumn heiugft, eiidowixl vnt'h 
reafion and speech, the influence nf a tribal ttexan^ of (hity in 
«trengthemog tho tribe takes a more varied form. It is tnie 
that in the nider stages of human life many of the services 
rendered by the individual to others are nearly as much due 
to hereditary habit and unreasoning impuEse as are th<i.se of 
the bees and ants. But deliberate, and therefore moral, self- 
sacrifice soon luaies its appearance; it is foatend by the 
fiar-seeing guidance of prophets and priests and legislators, 
and IB inculcated by parable and legend. Gradually the un- 
reaeoning sympathy, of which there ore gemis in the lower 
niuiuala, extends its area and gets to be deliberately adopted 
an a baeiit of actioo : tnbal oHcction, starting trom a level 
hardly higher than that which prevails in a pack of wolves or 
a hordt; of banditti, gradually grows into a noble patriotism ; 
and religious ideals arc raised and purified. The races in 
which these qualities are Che niont highly develuped jire sure, 
Qther thiugK bemg equal, to be 8ln:inger than others in war, 
contests with laniine and diHaase, and to prevail in the 
ong run. ThuB the struggle for exi.ttenoe cbuhos in the 
ig run those races of meD to survive, in which the 
ii-idual ig most willing to sacrifice himself for the benefit 
of his enviroiunent ; and which are consequently the best 
^_adapt«d collectively to make use of their environment. 
^B XTnforttinately however not nil the (jualittes which enable 
^Tj|» xace to prevail over another, benefit mankind as a 
F "wfcofc. It would no doubt be wrong to lay very much atresn 
oo the fact that warlike habitt^ have often enabled half- 
' savage Ttuxa to reduce to submission others who were their 
*»iperiora in every peaceful virtue ; for such eonciuests have in 
the long mu incnjased the physical vigour of the world, and 
its capacity for great thingH, and ultimately pcrha[}a have 
doDO more good than harm. But there is no such qualifica- 
tion to tho atatemctit that a race docs not «stabli»h its claim 
to deserve well of the world by the mere fact that it llourishes 
nidiit <»r on the surlace of another race ; for it may 



nooR IV. 
en. TTil. 



lu mail 

•cU- 

bpemun 
iltJiUTat*. 
iiuil is Um 

hlLMH nf UlD 

Htrcnstb oi 



Bnt Bood 

i»mucd 
uriib Ui" 
ertl. 



304 



DtUUSTRIAL ORGAN IZA710N. 



KNIK IT. 
OB. Tin. 

in tbe t«i0 
of a jHixv 



The 

imdnnii- 
aanwot 
tboeuM 
QSUmtii 
•■rlj tiiDvti 
woTQii that 
It wiw 
iLieM, 
Int not 
tirnl it wHH 
fro« frotD 
dMwbooks 
9na tLeo. 



tbOK 

3 



r 



flOMtf it* 
InddnU 



do so by having merely the paraattic power of tninung 
peculiaritiL-a uf tliiit race tu goud tKcuiml for its oytd pui 
The fact that there ia an economic dcinaad for the service of 
Ji;n-iKh and Anueuiiun money-dealerH in Eaateru Eurc^ aud 
Asia, or for Chinese labour in Califuruia, \s not by itaetf a 
proof, nor even a vety strong ground for believing, that aiicb 
ajraiigeineTits would tend to raiae the quality of huumu Ufe 
as a whok". For, though a race entirely doix-udeut on its own 
resources can scarcely prosper unless it is fairly endowed with 
all the most important aotrial virttieit; it iit poasible for a race, 
which has not these virtues and which is not capable of 
independent greatness, yet to thrive on Its rclfltious with 
another race. But such cases are exceptional: and on the 
whole hennlity anftoitx the hareh(>st features of the Btrrigf^le 
for existence among the raeus of men; and cauBes thoK 
msa* to survive and prndnminate in which the best qualit 
are most strongly daveluped. 

§ 3. This inltuenee of heredity shows itself nowhere 
marki3dly than in social organization. For that must neces- 
iarily be & alow- growth, the product of many generations : it 
must be based on those customs and aptitudes of the great 
maHi of the people which are incapable of ([itick change. 
In early times when rptigious, ceremonial, political, military 
and indu»^trial organization were inhiTnately connected, and 
were indeed but different wdes of the agunc thing, 
nearly all th^xsc natioQH which were leading the van of 
the world's progress were found to agree in having adopted a 
more or less strict system of caste : and this &ct by itnolf 
proved that the distinction of castes waa well suited to iU 
environment, and that on the whole it strongthencd the races 
or nations which adopted it. For since it was a controlling 
Etictor of life, the nations which adopted it could not have 
generally prevailed over others, if the influence exerted by it 
had not been in the main beneficial. Their pre-eminenca 
proved nut that it w&g free firom defects, but that ita 
ccllcnoics relatively to that particular stage of pi 
outweighed its defecta 

We know that in the animal or vegetable kingdc 
Hpecii>B may differ from its competitois by having 



ANCIENT CASTES AND MODKKN CLASliE8. 



SU5 



^nalities one of which U of ^at advantage Co it, while the 
other is unimportant^ perhaps eveu slightly iujiirioiis, and 
that the former of tlime (^ualitien will make the apeintis 
' succeed in spite of \ts having the latter : the survival of which 
will then be no prouf thai it is hKUHficial. ThuH th« struggle 
for exisluncc han kept alive many qualities and hahits iu the 
humou race which wuru iu ilicmselvcB of no advantage, but 
which are afisociated by a more or less permanent bond with 
others that are great soxircus of strength. Stich iiuitancea 
an; found in the tendency to an overbeariug demeanour 
and a scorn for }>at>icnt industry among nations that owe 
their advance chiefly to military rictoriea ; and again in the 
tendency among commercial nations to think too much of 
ircaltb aod to use it for the piirpoijcH of dinplay. But the 
most sttiking instances are found iu matters of urgaiti^atiua; 
the cxccllvut adaptation of the ityKtem of caste (or the special 
work which it had to do, enabled it to flourieh in epltc of its 
gr«tt.t ftiults, the chief of which were it« rigidity, and it« 
eacrifioe of the individual to the interests of society, or rather 
^■to certain special exigencies of society. 

^H Poasiiiff over intermediate stagos and coming at once to 
^^BO modem organisation of thH Wustem world, we find it 
^^oifering a striking contrast, and a no le^ striking resemblance, 
to the ^t«m of caste. On the one hand rigidity has been 
I succeeded by plasticity : the uietbods of uiduBtry which were 
then stereotyped, now nhangn with bywildoriug quickness; 
the Bocial ruiatiowi of classe!., mid I he position of the indi- 
vidual iu his class, which wern then ilefinitely Bxed by 
traditional rules, aru now [lerfectly \'ariable and change their 
iaaos with the changing circtirntttaiici^H of the day. But on 
the other hand the sacrifice of the individual to the exigencies 
'society as regards the production of material wealth suemti 
le respectit to be A case of atavism, a reversion to crndi- 
which |>revailed in the far-away tiujcs of the rule of 
cute. Fw the division of labour between the different ranks 
industry and between different individuuls in the same 
ik is so thorough aud uncompromi^ng, that tho real 
itcrestH of the producer are sometimuH Id danger of being 
"sAcriticed. for the sake of increasing the addition which 
It SO 



BOOH [V, 
CB, Till. 

always 
more or 
UM«vil. 



T)i« uunai 
It tni« 
(if tbn 

Ktativiu 

iudiulrml 

cliuiMii [n 
Uicmudcm 
Wcirt«m 
worid. 



306 



INDnffTRIAL OltGANIZATION. 



MOXtV. 

au. vut. 

AduD 

mom 
cftKif nl to 

•AAiuHt 

SMic«tbiiu 

tolluweni. 



tllH 

Irar tlitt 
tLo natu- 
ral orgAni' 
xatlonot 
■Milutr b 
farmoK 
MutillD mill 
effidcut 
tboii ±t 
flrsC Bight 



his work makes Ut the nggnegate piodiictioa of 
wsailh. 

§ i. Adani Smith while iiudstiag on the general advHU- 
tagcjiS of that luiuute division of labour and of that subtle 
indiif>trial organization whicli wurv being cievelopt^l with 
UDcxiuupled mpidjt^ in his time, was yet careful to indicate 
miuiy points in wKit;h the (tj-steni fail<.-(l, bikI mmiy inndtniul 
evils which it involvedS But many of his followers with 
lesA philosophic Liisight, and iii some cases with Ices nal 
kuowlcdgo of the world, argut;d boldly that whatever is, ia 
right. They were not contented with insiatiDg that the new 
indiutnal orgamzation was spreading rapidly and obtaining 
victories over it» rivals iu every UirectloD. and that this very 
fiujt proved that it met a want of the times, and had a good 
batajice of advantageH over disadvantages. But thoy wont 
further and applied the same argument to al! ita details; not 
perceiving tliat thn vi>ry Rtrength of the ttjTitera as a whole 
euabted it to carry along with it many iucideut^ which were 
in thenutclves evil. For a whil(> thi^y fascinated the world by 
their romantic accounts of the flawless proportions of that 
'■ natiiml " organization of industry which had grown from 
the nidimentary germ of self-intereiit ; each man electing his 
daily w<»rk with the nole vit-w of getting for it the best pay 
he could, but with tlic iucvitnblc rofult of chounng that iu 
which he could be of most service to othera They argued 
for instmicL' that, if u luiui hiid a talent fur nuinaging business, 
he wnuld be Hiirely led tci uhc that talent for the benefit of 
mankind : that meanwhile a tike piu^niit of their own intereiU 
wuultl Il-iu] others to provide for his use such capital as he 
could turn to bcRt account; and that his own intcTest wondd 
lead him so to arrange those in his employment that evety 
one should do the biglii»(t work of which be was capable, and 
none other; and that it would lead him to purchase und uae 
all machinery and other aids to production which oould iu bio 
hands contribute towards supplj-ing the wantd of the world 
more than the etjuivalent of their own cost. 

They were right in contending that theee were importoat 

I Itdwonoo hM alrejwl; boi-n m«tla (Bk. t. Clurr. (S) tatlioiaM«iir»Ui ^wvaT 
the Icm IfmUManittitvi la Oaaauij. 



TKB DEVELOPMENT CtT ffACtJlTTES BT D8B. 



807 



tniths which muld not be properly understood without a 
much tnoro careful study thau was given to them by those 
ready ■writeni who, then an now, attained au easy popnlarity 
by isdiscrimiDate attacks on tht> exixtiiig etuto of Hoci«ty. 
But thvir owD dofoacc of it, though more intelligent, was 
aliDOBt equally open to the charge of ptirtisau biae. The 
romantic siibtilty of thi* " nntuial organization of industry" 
had a fiiscination for earneat and thotightftil minde ; it pre- 
TeDt«d thorn from seeing and rrmoring the evil that wm 
intertwined with the good in tho changes that were going on 
Around thum ; and it hindered them from ini]uiring whothor 
many even of tho broader fcfttiims of modem iuduetry may 
lot be tranaitioual, haviug indeed gocxl work to do in their 
. a>t the cnitto f_\*st«m had in itn time ; but Hkn it chioHy 
*ble in leading the way towards better arraugetnents 
a happier age. 

§ 5. MoTKOver the doctrine t-ook do nccoimt of the man- 
ia which organn are Htrengthened by being iisftd. Mr 
ert Spencer has done more than any one else to establish 
the truth and the tiignjficancc of the law that if any phyKirul 
or mental cxerebc gives pleasure, and is therefore frequent. 
those phracal or mental nrgfUM which are used in it aie 
likely to grow rapidly. Among the lower animals indeed 
^tfae action of this law is so intitoatuly inlvrwovea with that 
kfthu inirvival of the fittest, that the difltinetioa between the 
two need not often be emphasized. For ae it may lisvo been 
guessed a priori, and oa aeeniH to be well jiraved by observa- 
tion, the cflect of the struggle for survivaJ is almost entirely 
to prevent animalti from taking plc-osure in the exercise of 
any functions which do not directly contribute to their well- 
being'. But man, with hiR strong intlividualtty, hoH greater 

> The fir»lTr bIkih Inng i^rck riiabtc> tt to imnlvo bp tontitig mi tbo •botW 
' Um> vlipu Uie ei%m Is At\vA a|i, luny |iOMdh(f loDi.'llii'ii iU UMk ^t tvoVbtf hj 
rtntcbitiit it. ftiul thtiH fnrthaf inermM Itn pnwor e( rarvtrlnf ; hut 
tiiU cBact i* not yargtmeXj longht. Agun. the Xaaimitaj f«c ftU fKicaUBHliM of 
tliw sort to iuvtvuKi Ui«u r*k uf icrowtti ta Uta* bow «u. mltiin o«rt*iD Umit*, la 
■Ssired to mA itaoU oat iuiu|i|iuMd (ouImb bj fcxunl »eI«cUoi)) In Uiv aoUiwl 
ktafdant. TIm InuKirr. vlthin certain Uinllik ■ RtraSc'i nccdi K ami Uio bhh* 
■xrJuiTdjr be (ewU (ui Uib kbunU of trac*, ttae mora will bw elwuica uf ivrrital 
dcpHul oa Uw kngth of bia mvk: ami ili« graaler irlU be Iho fonw ulilcb ths 
iitrsgcle for anrHnI trill cxot in itBding to aee«lu«t« that groiilb (am Kota be. 

20—2 



BODK I?. 

an. rm. 



Uut bann 
waj> di>ii<> 
b)-Ui«dr 

cnmiiinU 
iiiiln([i«K 

ant. 



thn^tonk 
lou liUlv 

■CMont 
uf the do 

or f>4Mi1UM 

bf IIM. 



308 



INDUiSTHIAL OBOiNIZATION. 



Room. 
cH. Tin. 



qlUMtinii 

wb«Uiar 

OUT 

■Tnlicm in 
iitrmUi-ml)' 

of the 
bifhor 
CMallUKof 
tfanlownr 

ilnrtry 

lik tjrpe 
of tbow 
which wp 
niunt lukve 
in (inr 
mitula 
druiiiif til* 
fuUuiriui{ 



freedom. He delights in the use of his fncnlties for th*? 
own sake; somotimes using them nobly, whether with the 
abandon of the great Greek buret of life, or under the 
control of a dclibcrato and steadfaal Btriving- towards im- 
portaut (iuds; sometinms ignnblj mt in the cas« of a inorbi<l 
devolopmont of the taste for drink. The physical superiority 
of the English race over all others that have lived as largelf 
as we are doing a town life, is duo to a great extent to the 
games in which our youth exercises its physical faculties fbr 
the sake of exercising them : the religious, the mond, the 
LDtellectual and thoHrlUtic faculties ou which the progreaa 
of industry depends, are not acijuired solely for the sake of 
the things that may be got by them ; but are developed b^ 
exennBe for the sake of the pleasure and the happiness which 
they themselves bring: and, in the tuune way. that great 
factor of economic prosperity, the organization of a weli- 
ordored state, is the product of an infinite variety of motives; 
many of which have no direct couuectiou with the pi 
national wealth. 

We ought then to inquire whether the present injii5tna 
organizatiou might uot with advantage be so moditied as t4 
increase the opportunities which the lower grades of industry 
have for using their mental faculties, for deriving pleasure 
from their uae, and for strengthening them by use. The 
flj^ment that if such a change had been beneficial, it 
would have been already brought about by the struggle ftr 
survival, mu^t be rejected as invalid, becaiiRo the struggle 
acta slowly. F«r though it may bo true tliat developniuit 
would of iteelf tend in that direction, its action would bo 
slow; and it is the prerogative of man to hasten the pro- 
gTCHs of development by forecasting its next step and pre- 
paring the way for it. In harmony with the results of oor 
iti([uirieji a;* Ui tho supply of labour we may conclude that 
changes which add but lirtle to the ituniudiate efficiency of 
production, may be worth having if they make ua ready and 




in Chn Appwidii) , But iniiii nitU bin uiauy tuuUru. u ho inaj wt IiIoisfU Mi- 
benttui; to uumonfo Uic i-ruHtli of one iwmljuitjr, may miobI^ aot bimMlf la 
chock Uiv ntunll) ot uioUier: Uiu hIowuvui ut prnfron daiing tlw 
wiLi pijtlj due lo » dclibar&t« datMUtion of UaruiUK. 



DIFFICULTIES FOR FCTimE CONSIDEEUTION. 



300 



6t for a higher organization which will Iw nrnro effective in ooos it. 
the production of weaUh and more equal in its distribution. " *• "" ' 
Such are the conBiderations which we must have in our minds 
when exnminiog the pr&eeut forms of the organi2atiou of 
iiidustrjr, and the part which they play in governing the 
supply of material wealth : but a final judgment an to their ihaaeb iin 
good and evil eflfects must be deferred until we are able to eaanai b« 
take a bronder 8ur\'ey. Many important elemenw of theJ^'J^''*^ 
problem, in partit-ular those connected with the fluctuations 
of trade, and the inconstancy of employment, depending aa 
they do upon the influence of foreign competition, and of 
changes in the money market, lie beyond the sphKrc of tJiose 
elemeiitaxy inquirieii as to the methods of production which 
ve are to make in the following chapters. 




n 



foUowliii; 



BOOK IV. g 1. The Urst cooditioD of an efficient organizattoo 
°°' "' iudustrj- is that it should keep every oae employed at aiieli 
TlieoaQrM yrork a* his abilities anc3 traininc fit him to do well, and 
jntliuuid should equip hiui with the best iiiachinery and other appU- 
anccii for hit) work. Wc shall leave ou unc tddc for the pruseut 
the distribution of functions between those who cany out 
the details of production on the one hand, and those who 
manage its general arrangement and undertake its risks oa 
the other; and confine oursolves to the divistOQ of labour 
between different classes of operations, with special reference 
to the influence of machinery. In the following chapter 
we Hhall consider the reciprocal cfff^ct.<i of division of labour 
and localization of industry; in a third chapter wo shall 
inquire how far the advantages of division of labour depend 
upon the aggregation of large capitals into the hands of 
ainglo individuaU or Anns, or, as is comniunly »aid, on pro- 
duction on a large scale ; and lastly we shall examine 
growing spcciatizatiou of the work of bu^ess tuauagemen^ 

Every one i.-* familiar with the fact that "practice 
perfect" that it enables ati operation, which at first seer 
difliculb, to be done after a time with comparatively little 
exertion, and yet much better than before; and phj-siology 
in some measure explain:; this fact. For it gives reasons for 
beheving that the change is due to the gradual growth of 
new habits of more or Ichs "reflex" or aatomattc action. 
Perfectly reflex actions, such as that of breathing dunng 
sleep, are performed by the responsibility of the local oervj 



toet 



lOgUfelH 

pluution. 





PRACTICE HAKES PERFECT. 



:1II 



['without auv ivfert'Ticp to the supreme central atitho- book iv. 

"the thinking power, which 18 supposed to resiide in ^ ''" " ' 
the cerebrum- But all dL-Uhcrate movcnitints require the 
attention of the chief central authority: it receives in- 
formatiou ironi the nerve centres or local nuthorities and 
perhaps in some canea diret^t from the »entient nervea, aud 
fleiid» back detailed and complex tnstructioua to the local 
authorities or in mmc canea direct tn munciilAr nerves, and 
so coKotliuultut their action an to bring about the retjuirod 

For iziFtaace the first time a roftQ attempts to sk&t«, be suShi 
must give his whole attentiuu to keeping his bojaikcc, biB^JJ^^ 
oercbnim has to oxcwise a direct control over every mote- ™||^'^"* 
ment, and he has not much mental energj- left for other '^ti»s- 
thing!). But after a good deal of practice, the action becomes 
Mini -automatic, the local nerve centres undertake nearly nil 
the work of regulating the muscles, the cerebrum is set free, 
and the man can carry on an independent train of thought ; 
he can «ven alter his course to avoid an obetactc in his path, 
or recover hiu balance, after it h«s been disturbed by a slight 
nnevenueKH, vrithout iu any way interrupting the couise of 
his thoughta It seems that the exerciso of nerve force under 
the immediate direction of the thinking power residing in 
the eerebnim has gradually built up a set of coniiectionH, in- 
volving probably distinct phytiical change, bHtwe«u th<e uerves 
and nerve centres concerned ; and these nev connectioQa 
may be regarded aa h Bort of capital of Ufcin.'e force. There 
is probably something like an organized bureancracy of the 
local nerve centres: the medulla, the spinal axis, and the 
larger ganglia generally acting the part of provincial autho* 
ritiee, and being able after a time to regulate the district 
and village authorities without troubling the supremo govern- 
ment. Veij' likely thoy send up nieasagea as to what is going 
on: but if nothing ranch out of the way has happened, these 
are vciy little attended ta When however a new feat has 

i ta be acoomplifihcd, us fur inirtancc learning to skate buck* 
wards, the whole thmking force will be called into requLsitioD 
for the time ; and will now be able by aid of the 6p«>cial 

} akfttiag-or^anizatioD of the nervee and nerve centres to do 



312 



DIVISION OF LABora. 



OB. a. 

TtM trtiat'a 
baud ttuti 
eye. 



lino— 



Knowleilgci 

Mid bUil- 
loetiuU 



what woultl hare bccu altogetber impoBsible without sSel 
aid. 

To take a higher instance: when an artist is painting 
at his best, his cerebrum i* fully occupied with hw w<>rk: 
his whole mental foroe is throi™ iuto it, and the stiain is 
too great to be kept up for a long time together. In a fen- 
hours of happy inspiration he may give utterance to thoughts 
that exert a porcRptible iuflueuce ou th« character of cnmi 
generatioiifl; but hia powor of cspreiwioTi had boon earned 
numborleee hours of plodding work in which he had gradually 
built up ail intimate connection hetwcen eye and hand. 
auBieieiit to onnhln him to make good rough sketches of 
things with which he is tolerably familiar, even while he is 
engaged in an engrossing cnnversation and is scarcely con- 
scious thai he has a pt-ucil in his hand. ^^ 

The ph^'siologicnl basis of purely mental work is not j4^| 
well understood ; but what little we do know of the growt^^ 
of brain sr.rncture. seems to indicate that pratitice in any kind 
of thluking duvelopes new counectious between diflerent pans 
of the brain. Anyhow we know for a fact that practice will 
enable a person to solve quickly, and without any coQsid< 
able exertion, questions which he could have dealt with 
very imperfectly a little while before even by the grea 
effort. The mind of the merchant, the lawyer, the physici 
and the niau of science. becomoM gradually equipped with 
a store of knowledge and a faculty of intuition, which can 
bu obtaiiiL'd in no other way than by the continual applica- 
tion of the best efforts of a powerful thinker for many years 
together to one more or less narrow class of questions^ Of 
course the mind cannot wnrk hanl for many hours a day 
in one direction: and a hard-worked man wiU sometimtft 
find recreation in work that does not belong to bis business, 
but would be fatiguing enough to a jwrsou who had to doit 
all day long. iSomc social reformers have indeed maintained 
that those who do the most important brain work, might d» 
a&ir share of manual work also, without diminishing their 
power of acquiring knowledge or thinking out bard questions. 
But experience seems to show that the best relief fiwn over- 
strain is in occupations taken up to suit the mood of the 




ABILIl 



JCAL BKI 



31S 



tnometit and stopped when The mood is pa«g«d, that is, in 
what popular iii-itinct clasKtM us " relaxation." Any oectipn- 
tioD which is so far husiiiess-like that a person must Kume- 
timeit force himself by an effort of the will to go on with i% 
draws on bis uervoua force and is not perfect relaxation: 
and therefore it is not economical from the point of view of 
the oommunity untetis its value is eufficncnt to outweigh some 
injury' to hia main work'. 

§ 2. It ifi a diBicult aud uiisettlcd question how ^ 
specialization should be earned in the highest bmnchen of 
work. In ecience it »cvms to bv u sound rule thiit iha area 
of atudy should be broad during youth, and ishould gradually 
be narrowed a^ yeans go on. A medical man who has always 
given his attention exclusively to one class of diseases, may 
perhaps give less wise ad\ice even in his special subject 
than another who, having learnt by wider experience to 
think of thoKe diseases in relation to g<eneral health, gradually 
eoncentratos his study more and more on them, and accu- 
mulat«ft a vaat dtore ofspeeial experiences and Rubtle instincts 
relating to them. But however mut-h doubt there may be 
on mattew of this sort, there is no mnm for difference of 
upioiou as to the iucrtased efficieuuy which win be attained 
through division of labour in those occupations in which 
there is much detnand for m«re manual skill. 

Adam Smith piHutcKl out that a lad who had made 
nothing but nails all hiK life could make them twitMi as 
quickly as a flrstrnte smith who only took to nnil making 

uuonally. Any one who has to perform exactly the same 

of operations day after day on things of exactly the 
le Bhape. gradiially learns to move his fiagera exactly as 



BOOK IT. 

on. a. 



In tlie 

gnitMi of 

«ork 

uxtrcnic 

Lioa do** 
not alwaTfl 

afflciencjt. 



Bal It ■• 

Ma? to 
acq nin a 

hlflh 
miuiliHl 
•ikill ill k 
narrow 
mnm at 
wttrk. 



I J. S. Uill irent lu fv w to umlnUtii Uiat tii* ocrnjnUonii at U>a luiU* 
I did not intcrfne with IiIr pnriiilt of pliiloaoiililrjil mquirics. Diit It «M«n* 
prglMMe that Utfadifirniuii at IiU fresliHst pmrcm luwctnl tbe qiwUt; at ku Imt 
UiNltlrt «un tfaan Im wr* awtiK: onit i1ii)tiii)i ii may Iihto dlmlntiitin) l>iit little 
Ui ntBWhalil* aMTuluHm iu bi> unu gniipmtinn. it prabalilji Eff4«tNl vbft mitf^li 
Ml ftHm at 6Mng Uial Itln'l <if worli nhirh tnfltir!iic«a Ihe conrae at Ihonght in 
(nUire ganraAtumo. II wan by hnabiuidttifi evcrjr atom of lua tnooll pbi-nnl 
Mnailll thai Darwiu was euabtnl tu do bo uincL vark nt ]aal Uiat kiiul: and ■ 
■ocial rdanaa who bad nciocmlrd bi cxplmtlng Oaririii'if Iclnarv linim In nmifal 
work on babalf e< Uie «oinmiutUy. wonM Imvd iauo u vtrj liul I'lece uf bmiiiuM 
fwtt. 



su 



DIVISION OF LABOVB. 



uoojt IV, 
OB. u. 








th&y ore wantf>[l, by nlmost automatic action iLnd with 
rapidity than would bo possible if overy movement had U> 
wait for a delibemte ini^tnicUon of the will. One familiar 
instance is soon in the tying of threadi; by children in a 
cotton mill. Again in a, clothing or a bout factor^', a. [>er«oii 
who sews, whether by hand or naachinery, just the same seam 
on a pi<^ce of leather or cloth of just the same size, bw^H 
after hour, dny after day, is able to do it with far less effijB^' 
and far iui>ro t|uickly than a work«r with much greater quick- 
ness of eye and hand, and of a much higher order of 
skill, whu wax accudtomed to make the whole of a coat 
the whole of a boot'. 

Again, in tbe wood and the metal induatriea, a i 
who has to pf-rfiirm exactly the same operations over 
ovlt agaiu uu the nami; piw:L- of uiaii-Tial geta into the halttt 
of holding it exactly in the way in which it is wanted, 
and uf arraugiiig the toats aud other things which he baa 
to handle in Niii^b {tonitiuns that be \b ablu tu bring them 
to work on od« another with tbe least poaslble lose of time 
and of force in the movements of bis imm body. Accus- 
tomed to &ud them always in the same position and to tak^_ 
them in the saiuu order, his baads work in hamiuny n-ith oa^l 
another almo&t automatically; and as hi& practice iucrcaiwii^ 
his expenditure of nervous force dimimshes even more rapidly 
than hiaexponditure of muscular force. But when the action 
has thue been ruduced to routine it has nearly arrived at the 
stage at which it can be taken over bymoehiuery. The chief 
difficulty to be overcome is that of getting the machine 



iinery 



1 Thf >>c«t ftnit D>n*t otponnlvnclotlimi nmtnKda ti^ hiehly flklDod and 
jtniil t«ilorii, tmnb of wfaain workK right thnm^h tinrt one gftRnetit and 
•uulLm ; irliilii tin- cliiM]>r>>t ui'l laoriit UuUmw w iiiulr (it tbnalioa «•(«■ Ij 
uitntilllcd wonicii wlio take the clntli lo tbcjr owa limncii and do titty pmrt at Iht 
■c«Lii|{ tliFiusdvMiL BdI <.'IotIi(>H of iiitcruiisliali! <|Uttlllim an uiailc in workdufi 
or fu^torlen, ill wliicii tbi! ilivldoii anil rabliTHiion ol laljciilr U r^rrlKl aa Tar M tki 
net) of Uii? >ti>II will itniiil ; auJ llile luctlioJ in raiilitlj' itunliijt uniuad at bolk 
t'liils at Ihn *siicii«i af tlin rival niRtJirul. (Kiw Uiw Bt-athcn l'atii<r"t BrtfekM 
Ea>l LtmdoH l.aiioi'r in The A'l'ne'cci'A Ctntitrt/ Itir AtlK>»l. H^^^] Vt»y tUUh 

Hut HBUiH acviiiuit nu^ be sivcu uf iUc {vcKst n>iuUtt»ii ot iiu> bout tnda ; ia mj 
)Mii;e AitirrLran Iwnt fnrt»rir3,, mnrr tlan ninety dUtiurt claitra ol irarin w af* 
alivad; rwoKuiimL (See (** Htpart rf tit Htm Tork Burtati tff • 
Loboof tar l(t86.) 





HACIIINEBT IK SELATION TO DlVISIOlt OF LlfiOUU. 



315 



hold the matorial firmly in exactly the panttoti in which mok n. 
,the machiQC tool can be brought to bcai on it in the right ™" ' 

ny, and without wasting in^auwhile too much time in 
taktug jfrip uf it. But this can g^iiorally be. contrived when 
it is worth wliile Cu ttiwiid huiuu La.buur aad expoutte oa it ; 
and then the whole operation can often be contixillod by a 
worker who, intting bi>tbrt! the mfichine, takes with the left 
haud a piece of wood or motal ft'om a henp and puts it in a 
socket, while with the right hv drow^i duwu a lever, or lu 
aoaw utlier way sets the machine tcxil at work, and finally 
with his left hand throwK on to another heap the material 
wbieh has been cut or punched or drilled or planed exactly 
a(U>r a given pattern. It is In these industrieti especially 
that 1^ find the n-|>urt8 of modem trades unions to be full 
ci complaints that unHkilled labuurert, and cvl*u their wivtw 
and children, are put to do work wbich used to require 
the »kLi] and judgment of a trained mechanic, but which 
hail been reduced to mere routine by the improvement of 
maohiner)' and the ever-incmasing ininuteness of the sub- 
division of labour. 

§ 3. We are thua led to a general rule, the ttction of 
which is mure pruniiueut iu 8ome brauchLYt of niuuufiicture 
than others, but which applies to all. It is, that any M*chtiieiT 
manufacturing operation that cuu be reduct^d to uuifurmily, ^^^o^ 
80 that exactly the same thiug has to bo done over and Jjl^^'^J^ 
over again in the same wav, i« sure to be taken over sooner "on. w<*k 

' . . L3) RkUlll- 

or later by ma«^hinery. There tnay be dola)-8 and ditficultics ; tumn 
but if the wurk to be done by it is on a suihcicut scale, 
money and iuvontLve power will be spent without stint on 
the task till it is achieved^ 



* ForinaUoccaiNgTwtJDVMiterbriuuaiinNl tu LAroupMitfSOO.OOOoiipxpvri- 
aiGnta rnUtiuiC k) U-xUIeHwdiiiierT: tnA likoatlaj'U ■riiil UihnTcbecn pliituilimUjr 
iHmwd U> biui. tio ilonl>l kiiii» of lil» luvrLtlunii ui^rv uf sncli n liinil hii ran Nr 
BHA* mlj b; m luui ot ,H«iiiui ; ami lioHvvnr trrvAt llw nucd. tUi-j miuL li»« 
watteil Ull tbt nfiii niui wui fonnJ fur tlicm. It i> inid lliat kn eiia.rji*il uot 
BiinM«awb|; ilWO M t^iyally lor«»clj u( yaivubinK iiiacJii&i.-B, nuA I lutu Wa 
UU hj » voiuleil muislHctiucr Uutt, hriag fnll at irnrk, ho toaai it wurtb hui 
rbdla Ici bnjr an •itillljciul iumcIiIiip. auiI inji Ihia pxlra c]ikrKi> fiir 11, cidIt kU 
nMMiUn before Un eipiiy of Uie patent. Itut ■ndi CMtm* nrr exteptiuual ; m ■ 
nils pattould maobuiM u« doI rnj Avar. In miup cmmi [bo «njiican; of liartag 
tben tQ fntae^i U oo« jiM* bf vpedal nuehutury hM bwtn w grrtt Ui«l llM 




B timn 

reajairm 
Ibbb and 
leu wfttch 
ins- 



dajftrv 
lion from 
thn tflitlln 
biduflUiot. 



tan t^l 



1 



Tbodivi- 
■Ion of 
Uboocin 
nlatlanto 
tha groKth 
ofiaachui- 



whi:n juMt invented, generaJIjr 
a great deal of care aud atteotioD. But the wur 
attuiidant is always bcin^ sifted; that nhlch in iinifnrm and 
itionotoiioiift is gradually taken over by the uiachuic, which 
thus bocnmea steadily more and moTf. automatic and self- 
Bctiug -, till ut lost tlierc is nothing for the haod to do, but 
to supply the material at certain internals and to take awtj 
the work when fiuit;hcd. There- still remains the rcHpoDsi' 
bility for seeing that the machinery is iu good order aod 
irorkin^ smoothly; but even this task is ofton made l^ht 
by the introduction of an automatic movement, which 
the machine to a atop the instant anything go«s wrong. 

Nothing could he more narrow or monotonous than 
occupation of a weaver of plain stuffs in the old time, 
now one woman will manage four or more loomB, each of 
which does many times as much work in the coura? of the 
day aa the lAd hand toom did; Jind her work is mueh leas 
monotonous and calls for much more judgment than 
did. So that for every hundred yards of cloth that 
woven, the purely monotonous work done by human beings 
is probably not a twentieth part of what it was'. 

Thiie the two movemeiitB of the improvement of ma- 
chinery and the growing subdivision of labour hare gone 
together and aru in some mea&ure couuected. But the 
connection is not. so close as is generally supposed It a 
the largeness of markets, th« increased d^uiaud for great 
number* of things of the same kind, and in some cases of 
things made with great accuracy, that leads to subdivin^^ 

iwtnntm hui found it tn bis mlviLuUiia Iu teU tbeni *t ■ pric* knrtr Uwt tkt 
old pn«e of th» iiit«iior miehiiieti wtii(b tU(>y (liH|i[»t'(Hl : for Uint <dri {trim ggn 
hiiu Ku hifih a |iron(, llial il van worth liii wliilo to I'Owct Uio prie« atill tmlhr 
in onlrir to inilncr tlir ane ■nt tLc niaclutiui fm uuw yuiyomfii auil iu u«>t nMikeU. 
Iu aliuint cvL-rjr UmIv iriiuj]' Itiliiics un dauo bj biuiil, titoujrh It l» vf II knowii tblt 
t]i<ij conlil i-iully h« di>iii- hj soinn mUpUtintiK □! machitie* that mtb mlraidjin bm 
\a tbul or wtiua utljiT (mile, uml wblch nre ant moAv only IxicatiH lliere vmU 
not M jcit 1x1 MiuQgli omplDTiDOiit tor litem to rtataawtu Uu traable uid BXp«aM 
of nuking Uicin. 

1 TW efflciuicy of Uboar Iu woavliic liu been ln«T««Md tvotre-foU Mid tlitt 
ill iqiliiiiiuK <iii-(«ltl Aarmg tlia Uuit neveut; ytwi, la Um pncoAliiK MTenlr 
jtmit [b« liii|irnvnn<>iitM tn Hgitnninii litd klnuul; lacnawNl tite cttduicy of UbcOT 
two hunilriMl-folil (fcoo Ellinou'* f.'ofton Tradr. v/ Ihtat Brilai», «h. I», BUd t.). 



Hnroi 






of labour; the chief effect of the iraproveraent of machinery 
ia to cheapen aud make more liccurate the wurk which would 
anyhow have been stibtlivided. For instance, "in organiziDg 
the works at Soho. Boultou aud Watt found it nL-cessarj- to 
carry division of labour to the furthest practicable point. 
There were uo sUde-lathus, plauiug cnachiuea or boring tuoU, 
ench as now render mechanical accuracy of construction 
almost a matter of certainty. Everything depuudod on the 
iodividiial mechanic's accuracy of hand and eye; yet me- 
chaaics gencmlly wcro much Itaa skilled then than they 
are now. The way m which Boulton and Watt contrived 
partially to get over the difficulty wok to coniiue their 
irkmeu to special classes of work, and make them as 
ifexpert iu them as po»«dblo. By continued practice io 
handling the same tools and fabricating the same articles, 
they thus aoguired grn&t individual pruticiency'." Thus 
machinery constantly supplante and renders unnecessary 
that pup>ly manual skill, tho attainment of which was, «ven 
to Adam Smith's time, the chief advantage of division 
of labour. But this induencc is more thau countervailed 
by its tendency to increase the scale of manufactures and 
make them more complex ; and therefore to increase 
the opportunities for diviinon of labour of all kinds, and 
especially in the matter of busiutHs luanagcmeut. 

§ 4, The powers of machinery to do work that re({uireB 
much accuracy to be done by hand are pt-rhape best 
n in come branches of th(> metal industries in which thu 
system of Interchangeable Farts is boing rapidly developed. 
It is only ailer long training and with much care aud labmir 
that the hand can make one piece of metal accurately to 
resemble or to 6t into another: and aHer all the accuracy 
H oot perfect. But this is just the work which a well made 
michijie can do niont ea.<nly and matt perfecrtly. Fur tn»tanco 
if soving and reaping luactiiite^ had to be made by hand, 
eir tint cost would be veiy high ; and when any part of 
era wa* broken, it could be replaced only at great awfe 
sending the machine hack to the maDufacturer or hy 



Uschinerr 



■iiil Ulna 
djmijuiihoi 
■uno of 

iBftW of 

ilirinoo of 
labunr: bat 
JQcrtSMa 

Ilia MOM 

lor 11. 



M«eJimo- 

rhliierj la 
iiitioJucuig 
tlic nev 
era of 

IiiUir- 

rliAii^Mtbls 

PmU. 



) SnUlM' Bmilltm/aid ifalf. pp. 170— 1, 



318 



DIVISION or LABOUR. 



tinoK nr. 

Ctt, II. 



hringiug a highly skilled mechanic to thv inochim-. 
as it is, the mauiifacnirer keep* m store m&ny fecsdmile* 
of th« broken part, which were made by the same machinery, 
and atL- therefore interchangeftlile with it. A fanner iii tlie 
North-West of America, perhaps a hundred miles away fmin 
any gcx>d mechanic's sh»p, can yet ii»e complicated ma- 
chinery with confidence ; since he knows that by telegraphing 
the numl>tT of the mochiuc and the number of any port of 
it which he has broken, he will get by the next train a nev 
piece which he can himwif fit int^o its place The import- 
ance of this principle of interchangeable partA has been 
but recently graapod ; th«re arc however many sigiui that 
it will do more than any other to extiend the use of machioe- 
madc macliiuery to uverj' branch of production, iDcIudiog 
even domestic and agricultural work'. 
QioAfttloD '^^'^ iutiuences which machinery excrt« over the character 
^J«^^^^ of modem industry are well illustrated in the maoufactun 
of watches. A few years ago the chief scat of thU bosineil 
was in French Switzeriand ; whcro the eubdivision of labour 
was corned far, though a grea(. part of the work waB don» 
by a more or lese scjiltered population. Thort! were about 
fifty distinct bmnches of Irfade each of which did one small 
part of iLe work. In almost all uf them a highly specialized 
manual skill wa.-* refpiired, but very little judgment; the 
earnings were generally low, becautie the trade had been 
established too long for those in it to have anything Uke a 
monopoly, and there wa« no difficulty in bringinjT tip to 
it any child with onlimiry intelligence. But this industry 
is now yielding ground to the American system of making 
watches by macliiuery, which requires verj- little opodaluted 
manual skill. In fact the machinery is boooming OT wy 
year more and more automatic, and i» getting bo reqai^^f 
les-s and less uAsistance irom the human hand. But th^^ 
more delicate the machine's power, the greater is the_ 



in&kiii): 



Oomplu 
macolnc 



iigfUen^ judgment and carefulttetis which is called for from ttuM^J 

1 Tbo wytUm nwm llit nrigin iii gruiL lanaEitts u Sir Jowph niiiLirortb'a 
Ktiuii3ar<) igiitigDii ; Imt it Liui bwii vrorkod MX wltti mttil ouUiprin; uwl Uionjaith- 
iii-Hi ill Amiiru-ii. TIli'Tii Ih ■> good BecouDt of it bj Ur TrciwLhiJi;* in Vol. u. «f 
tbv Itcport a1 Ui« tontb cciunu tor Iho Uuiteil 8tet«*. 





MACHIK'E&T IN RELATION TO GENEHAL IKTRIXIOKKCE. 



819 



rho see aft«r it Take For inntanco a bcaubiiii! mochioo book i*. 
wluch fccdn itetclf with sU-t-'lwire at one cud. uud dflivi-re * ^' ° ' 
al the other tiny screws of exquisite tbrm ; it diaplacea &""".'•■"'"■»'' 
great raiujy opcrativtw wlio hud iiideud acquired a very high mmit u>'l 
and specialized niauual skill, but who lived sedontarj- SivL-s, ^[^. 
alnuuing their eyesight through micnsscopes, and finding insww*: 
th^ work vdry little scope for any faculty oxcopt a mere 
commaud over the usu of their fingers. But th^ macluQe is 
iutricate aud costly, and tho penou vho minds it wust have 
an iutelligenct!, aud an nutirgetic sense of responsibility, vhioh 
go a long n-ay cowards luaking a fine character ; and which, 
though more common than they were, we yet Bufficiently 
rare to be able to earn a very high ralo of [my. No doubt 
this i» an cxtrcrao case : and the grentcr part of tho work 
done in a watch Jiactory ia much sitopler. But a grtat dcW 
of it requires highcx tocullios than the old system did, and 
tfaoBG engaged in it earn im the average? higher wages; at 
the same time that it has already brought the price of a 
tniBtworthy watch within the range of the poorest classes 
of the community aud is eihowiug sign» of being able soon 
Jo accomplish the very bigheKt ehi»t of work'. 

Those who finish and put. together the different part^ Bud in 
of a watch must alwavB have highly spet-ialized Kklll : hut wvakmi» 
muKt of the machines which arp in use in a watch factory. |Ii^_r, 
are Dot diflKrant in geueral character from thoiw which are t'*^ ''^'^'^ 
used in any i>ther of the lighter metal trades : in iact many \ndta. 
ihcm are mere modiiicaliuus of the turning lathes aud of 
le slotting, punching, drilling, planing, shaping, milling 
machiui«and a few others, which are familiar to all engineer- 
I iug tmde-S. lliin u a gnnd illuKtratiou of the fact that while 
Llhero is a constantly iucreaaiug subdivision of labour, many 
^^■f the lines uf divifttan between trades which are nominally 
^^Kstinct are becoming uarrnwer and less diHicult to bu 

■ Tbn ptrfectiou wbkli the nudiuiMy has tinmij atUliiad !■ alutwii lijr tlie 
Uet ihAt U Uir laTtDlluii* Kililtiiiion nowtl^ held lu London, llie rppruuiulAtivd 

si am Aiuorifku tr*ti^ iaftMJ look la ^iccc* &ttj iCAtebM b<(iva aaitai Kugli«li 
npMMDiktirea ot Uiv uIiIm b7»1«iii iit uwuultctiu*, tuid alitse tliroviug the dU- 
ItowBt ywta IbIo Utj dlAtnM liaapa, mIwiI tbsm to mImI for liiia one irfcoe bvm 
fJi ttiM|i tw mi— mriffn i be tbon wit Urm pkNWBiipui aM)«l the wMdi ohm and 
Iiuidad tliMB bftck • vitcia In |i«rt«ct ovdv. 




ninatmliun 
(rum tlip 
prill ting 
ind«. 



times 
to watch -makera, who happened to he suSuring from 
dimiiushed duraand for their vmn^i, to be told that 
gun-making trade was in want of extra hands; but 
of the operatives in a watch factory would find 
very eimilar to tho&e with which they wuro familiar, if they 
strayed into a gun-making factory oraewing-toachiiie faeton-, 

or a factorj- for making textile machinery. A watch factory 

with those who worked in it could bo converted without oi^H 
overwhelmiiig loaa into a sewing-machine (actory: almost 
the only condition would be that no one should be put id 
the new fiictory to work which required a higher order of 
gcni'mJ intelligence, than that to which he was already 
accustomed. ^_ 

^ 5. The printing trade nifords another instance of m^^ 
way in which an iniprovemynt of machinery iin*l an incrcjwe 
in the volume of production cftumcR an elaborate subdivision 
of labour. Everyone is familiar with the piuneer newspaper 
editor of newly settled districts of America, who sets up 
the type of hia articles as he composes them ; and with tJie 
aid of a. boy prints ofT hii^ sheets and distributes them to his 
Bcattereii neighbours. When however the my»t«rj- of priDt- 
ing was uew, the printer had to do all thw for himself, and 
in. addition to make all his own appUaneea', These 
now provided for him by separate "subsidiary" trades, fr 
whom even the printer in tht; backwoods can ubtain ever 
thing thiLt he wauta to use. But in spite of the assist 
which it thuu guts from outside, a large printing establish' 
ment has to find room for many ditlenxit claKaca of workers 
within its walls. To say uolhiiig of those who organize and 
suiH-'riutcud the busine-ss, of thosu who do its offict; work and 
keep ite storu!, of the skilled "readers" who correct an^l 
crrora that may have crept into the " proofs," of its eugince^* 
a,nd repairciti of machinery, of those who cast, and who com-ct 




> " Th« ln<« fonndor «*s pmbalilr Uii» flmt to swadv (ram tli« miiMni: Uhb 
vlaMn doWnti^il to otbi?rs llix iiiithing of ]-t«M«4; klU-nr&nla Ui« Ink Mid lb* 
VoBttn lannd MiianW iwiil diatiiict nuautucttuien ; and Lkara arc** k cImbb of 
pcrMtis wlin, UimiKli belonging t» oUisr uwka, inad« irintiiiK kp^uicm a 
eiierialty. ladi tm |iriut«rr nnltlui, printer*' juiucn utd prtuUn' vncinetin" (U^ 
Koathiwil in Um Article ou Tvpv'jrapfiS In tba t^qi<ioiHMdiA BriUmni**). 



ILLUSTRATION FBOU THE FRINTIKa TB&DE. 



321 



and prepare its storcotype plates ; of the warehtnwemen and wxw i». 
thv boys and girls who assist them, and several other minor * "'" ' 
classes ; there arc the two great groups of the compoMtore who 
set up the tj-pe, and the machiniHtH and pn-ionntm who print 
impressions from them. Each of thoso two groiipfi is divided lasUiMwof 
into many smaller groups, cipecially in the large centres of pu"iii" n In 
the printing trade. In London, ior instance, a minder who SIJUttT'oi' 
was accustomed to one elium of machine, or a comp<«itor i''"''"""'f 
who was accustomed to one cloas of work, u thrown out of 
employiueut would nut willingly abandon the advantage of 
his specialized iskill, and falling back on his general know- 
ledge of the trade seek work at another kind of mnchine or 
iu another class of work.'. TheMf barrien) between minute 
Hiibdivl'iion.t of a trade coimt for a great deal in many 
d**cripiJou* of tlie modem tendency towards apeciidiMition of 
industry; and to some RXtent rightly, bocauee though many whicJiwui 
of them are no slight that a man throwu out of wurk in ^£^^ 
aoe subditiiuou cuuld pa:i« into one of itH neighbours without ^|^|„ 
' DV great loss of efficiency, yet he docs not do so until he 
baji tried fur a while to got employment in hiB old EincH; and 
therefore the harriers are as effective aa stronger ones would 
be so tar an the minor llnctnations of trade from week to 
week are coocemed. But tht-y are of an altogether different 
kind trnm the deep and broad ptirtitiona which dividtxl one 

j group of mcdiieval handicraftHinen from another, and which 
caused the lifelong suffering of the handlooni- weavers when 

^■tbtur tnkdL- had left them. 



But let us follow still further the progress of machinery tii«> vemm- 



PSMT 

trade 



h BifailBTi te itutwiu, Ur 8niitbn«rd UiIU w "mif dndsntwiil only 
bnok nwcloBea or taij mws nucUluie; bu ta^j knov bU sbonl" nudiitiM tlial 
pliiit (TUB) lUl tmrtacm nr Uimn Llul print Irani rrtiiitlnni; "or of vjUndcin he 
»!&}■ Idiowoiilj ouu kfuil. Eulirely iio\iA machluun crcuu- m now eitut* of artiaatu. 
Tbrrp arr Bun [»r(i>oU7 Minp<il«iit to mMiORii a WUUr preu who an iATinrftAI 
ban k) w««k two«(il>j>iiT or fine txraJi'Vixirk utoliinvti. la tbe wmpontor'a dcpart- 
tamt (liTiniou of kbuur i* curled oat to a fitOl mbater dcsroe. Aii old^fasbiuii^d 
(■rtutai woaiA Mt up iralilTpn'titlj a {ilacanL a til1^pr^[D. or u buok. \l Hie 
pMMnt diy **« bavH )u)>biu£ liaada, book lisnda and new* Land*, tlif <ronl 
'h«Dd' anggHtitig the (aetoij-lik* natnra of Uie biuuiua. rhum aru jubbtug 
luuul* wbo eooAiM tbanaelrca Ui pMter*. Rook huiiU oompriw thou whn wt Dp 
Uw liUaa ■ol Um>w who Mt nii tlie hcAj of tin.- vork. Ot (Lmk- latter tgtin, 
vhilo «na ■■» «OBpona, aootlMr. the 'nuker-ap', >n*ufV« Ih* imcoa." 



M. 



21 



322 



DIVISION OF {.ABOVa 



iioos rv. ID supplanting maniial Inboiir in Home directions and 
" "• " • ing out new fields for its employment in others. Lot us 
watch the proceits bj which large editions of a great 
newspaper are set up and printed uff in a few hours. ^M 
To begin with, a good part of the type-itettitig U itawV 
often done by a machine ; but in any ease the types are in 
the first iustancu uu a plane surface, from which it \b iiu- 
posaible to print vory rapidly. Tho next stop thorofore is to 
make a pnpier-mnoh^ cast of them, which Li bent on to & 
cylinder, and is then used a* the mould fixmi which a new 
metal plate in cast that tits the cylinders of the printing 
machine. Fixed on iht-se it rotates alternately agaijjst the 
inking cylinders and the paper. The paper is arranged in 
a. huge roll at the buttom of tht inactiine and unrolls itself 
aiitotDatica.lly ftrnt against the damping cylinders and th*^^ 
aguniat the printing cylindent, the fintt of which printa^f 
on one side, and the second on the other: thence to the 
cutting cyluiders which cut it into equal lengths and thence 
to the folding apparatus which folds it remly for sale. When 
the machinery has been got ready, one man can manage 
entirely and it will print off 12,000 copies in an hour. 
iii»tanc»uf Now looking ut all this we are struck on the one h. 
iilVnuuul ^y the power of mechanical and xciculific appliances to 
tiMoftt" '^^**"" results that would be impossible without ihem: and 
'*'*^h*' on the other hand by the persistent way in which they tak« 
amnUnnry. over work that used to require manual skill and dcx1«Hty, 
but not much judgment ; while they leave for man's hand 
all those partb which do require the utic of judgment, and 
open up all sorts of new occupations in which there h a 
great demand for it. Every luiprovemcut and chuwpcning 
of the printer'a appliances increases the demand for the 
judgment and discretion and literary knowledge of the 
reader, for the skill and taste of those who know how to 
set up a good title pivgc, or how to make rc«dy a sheet on 
which an engraving in to be printed, so that light and shade 
will be distributed properly. It increases the demand for the 
gifted and highly-trained artists who draw or engrave uti 
wood and stone and metal, and for those who know how tu 
give an utxurate report in ten liaea of the substance oiA 



ncn 

1 





HACHIKBBT DtHINianBS BXCfSSlYE FATIQUE. 



323 



that occupied ten minHtes — an inbellecttia! feat the tioos iv, 
^ffittniHy of which wc underrute. because it is bo froqueutly °^" ' 
perfOTroed. And agmn. it tends t« increase the work of 
photogiapbcw and dL-ctrotvpers. and (stcrfotypcrtt, of the 
makers of priBtere machinery, and many others who get a 
higher traiuiag aud a higher income (rom their work than 
did thoBC layers on and taker* off, and those foldcis of news- 
papers who have found their work taken over by iron fingers 
aud iron arm^;. 

§ 6. We may now pass to consider the effects which UMUmn 
wiftchinery hast in relieving that cicceaivo miiacnlnr atmin .inSTIm 
which a few goneratiooK ago ivaa the cominun lot of more jjj^i?^, 
than half the working men even in Riich a country a» England. 
The most inarvii-lloii^ instances of the power of maohinury are 
seen in large iron works, and especially in those for making 
armour plates, whare the fonse to be exerted is »o great that 
man'tt muscles count for nothing, and where every movement, 
jWhether horizontal i»r vertical, has to be effected by hydraulic 
steam force, and man intands by governing the machinery 
and OGCasLonally clearing away a^heA or performing some Riich 
secondary task. Machinery of thix class has increased our 
command over nature, but it ha« not directly altered the 
character of man's work very much ; for that which it does 
he aiuld not have done withimt it. Let n« then look ab 
work such as that of house carpenters whn make things of 
the same kind as those used by our forelathers. hut with 
moch less toil for themselves. They now give themselves 
cfly to those parts uf the task wbich are most pleasant 
id most interesting; while in every country town and 
nhnost every village there are found steam mills for sawing, 
ining and moulding, which relieve thom of that grievoiu 
ktigue which not very long ago uaed to make them prema- 
turely old'. 

t Tbc JBtk'pluiQ. nsvd for uuluiig smuotli iargt KMrda fur fliers mi'l ollirr 
parpoaea, «»• tbe woru Hitcoj of tlic c«n>cnt«r. All iut »i>vc!*ll.v »kiIlL-il lui-ii 
*m CMttpalkd Ut nf*ai m gnM put of Uieir tiiutt wiiii Uie jnck'iilAur, and tiiU 
bnMBhl aa hMtt dlMtue. uukinc Uiein %a n rnlo oM mi->i by tti^iiiuo ilK-yni-rti 
fortj. Bat now Umb* wlto twcoina prtmulnrely olil Uiroagb avtirwurk. am to bis 
fuind »laiMt csolntf T«lr woMig Ui« pKt««lMwl hIuh*. unoiiit Ukmo ■tiK«<Ml in 
inar* uixknu Uadji «f buiucM, uid iu ecimv kKHcallnrk] diitri«l* in wliieh Ihs 
I <i( VICM U StUl mj low ftiul tlic prMi|iln art! habiCoAUj uiiilertvJ. Ailau 

21—2 




monotony 
of work 
tnoiB ID- 

moDutaQy 
cillife. 



vaea ^^^ 
peisoM 



TheMxtUs 
indiwtrMa. 



Facts of this kind ore to be found la the recent. 
t>f nuuxy trades: and they arc of great importunoc when 
are considering the way in which the modem orgaiusatioo^ 
indufitiy is tending to narrow the' scope of each 
work, and thereby to render it mouotonous. For those 
in which the work is most subdivided are th.o«e in which tht 
chief muscuLar stnun is most certain to be taken off hy 
machinery ; and thus the chief evil of monotonous work is 
much dimintHlied. As RoBcher aays, it is monotony of life 
much more than monotony of work that ia to be dreaded : 
monotony of work itt an evil of tho first order only whoD it 
involves monotony of life. Now wh«u a person'ti employ- 
ment requires much pliysical exertion, he is fit for nothing 
after hie work ; and unless his meiit-Hl faculties are called 
forth in hid work, they have little chatice of being developed 
at all. But tho nervous force is not very much exhausted iii 
the ordinary work of a factory, at all events where there i» 
not excessive uoi:se, and where the hours of labour are not 
too long. The gocial Murrouudinjfs in the facuiry and out 
of it stimulate mental activity; and even those worken in 
it whose occ'upatiuns are svomingly the moi^t monotonous 
have much more intelligence and mental resource than has 
been shown by the- English agricultunil laboure.r whose em- 
plnyment has more variety. It is tnie that the American 
a^culturist is an able uiau. atid that hia cbildn;n rb*. 
rapidly in the world But he han had better social con- 
ditions thau the EiigHBh ; he ha*^ always hod to think for 
himself, ajid ha» long had to udr and to repair complex 
machines; and the English agricultural lubuurur i» following 
in his ateps, and i** steadily improving hie position. 

Perhaps the textile industries afford the best 
of work that uaed to be done by hand and h now 
by machinery. They ore especially prominent in Euglanfi 
where they give employment to nearly half a nullion ma 



iustoa^l 
ow dc^M 



SmlU) teUs ns ihat " vorkio^D. whsu U107 an VbtnUf pud. m 1M7 qiit to 1 
work tbomMlTM nnil U ruiti tliuir ImJUi Mid cotwUlnUoD In a law 7M», A tmt- 
I«nt«r in Lonilou.knd in Bonwolhar iiImcb. >■ not mppoaad to liMt in hb tinuai 

vi||i}iir aIutd night jtun Almcut worj dm at utifiMn U fliifcJMt U> aoB* 

{MrticnlarinflnnitjoccMJoiicil b^ cscMniTe application t« Uieir pcnilfu a p adw at 
work. ' ll'caJth of Natioiii. Buub 1. Clmptt-r vii. 



HOKOTONY OP VTOBX AMD MONOTONY OF LIFE. 



3S5 



ad raore than half a million femaiea. or more than one in book rv. 

ten of those perHoos who are earning indwpemlent incomes. ' "'• " ' 

The stnun that is taken off human muscles in dealing even 

with those soft matt-rials in shewn hy the fact that for every 

one of these million operatives there is used about one 

horee-power of steam, that is. about ten times u» much 

as they wfiuM thcmselvRs exert if they were all stnmg 

men ; and the history of these iuduMtries will serve to remind 

us that many of those who perform the more monotonous Mo«rt nt 

parts of manufacturing: wurk are as a rule not skilled workers rio^n'ofto." 

who have come down to it from a. higher class of work, but JJ^^^I^,icj 

uQfilulled workers who have risen to it. A ereat number '"*^ ^T" 

^ coma loll 

of those who work in the Ijuicaahire cotton mille have tow bdow 
oome there from poverty -Ktnckou districttt of Ireland, wliilc Hbm*. 
others ore the deawudants of paupers and ]>eopIe of weak 
physique, who were Kent there in large numbers early in the 
century from the most miserable conditions of life in the 
poorest agncultural difitrictA, where the labourers were fod 
and housed almost worse than the animals whom they 
tended Again, when regret ie expressed that the cotton 
factory hands of New Knj^land have not the hl%h standard 
of cntturc which prevailed among them a century ago, we 
moBl remember that the descendants of those factory workers 
hart* moved up to higher and more responsible posts, and 
include many of the ablest and wealthieet of the citizens of 

erica. Those who have taken their places are in the process 
being mh%d ; they arc chietly Proncb Canadians and Irish, 
who though they may learn in their new homoB iM>me of the 
vioefl of civilization, are yet much better off aud have on the 
whole better opportunities of developing the higher faculties 
of ihemst'lves and Iheir children than they had in their old 
homes- 

§ 7. But poking from this inquiry we must proceed to ^wUk^ 

cuntiider what are the condition» under which the economies tdbcIiIimij 

in production arising from division of labour can best be SSii with 

It ij! obvious that the efficiency of specialized '"'^«?"*" 
'1-1 -1 ... iBTimlMi 

specialized skill is but one condition uf its ruiurcn- 

the other Ik that HuflBcient wurk tihoiild be be found 



J mcl 




326 



U1VI8I0S or LADona. 



liouK IT. 

ai. IS. 

tor Ibeni tl 
Uurfi Bpe- 
clnl work. 



abouUu 

f»T MpO*- 

witbu 

llifflCTlIt 

the; oui 




°4 



lint TTHui is 

titl' >i]» OH 

well ftd 
the i^wt>t 

tioti. 



Tlic iuqni- 
rirji iminn- 
dlHtely 
before na. 



foitiid to keep it well employed. As Babbage pDiDt«<l 01 
in a largt: factory " the masU-r mauufocturvr by dividing the 
work to be executed into different processes, each requiring 
difl'ercnt degree* of nkill or force, can purchase exactly tlmt 
precise quantity of both irhich is ncoeseary for each procoas^ 
wheroae if the whole work were executed by one work 
that person must poHsess suSicient skill to perform the mo 
difficult and Kiiffieient st,rt!iigt.h to execute the most laborio 
of the operations into which the work h divided." Aud it j 
to bo noticed that the ocooomy of production rocjuiriL's not 
only that Bach ptraoii should by eniployi>d constantly in 
narrow raugc of work, hut also that, when it is neeessaty 
him to undertake dilT«rent taKk^, each of these tasks idioiilfi 
be such as to call forth ns much as possible of his skill and 
ability. Just in the same way the economy of iiiacliineij' 
reqiiire-8 that a powerful tiiming-lathe when specially ar- 
ranged for one class of work should be kept employed u 
long as possible on thai work ; aud if after all it is necessaiy 
to employ it on other work, that should be such as to be 
worthy of the lathe, aud not such as could have been doDta 
equally well by a much smaller machine. | 

Here then, so far as the economy of production goes, 
men and machines stand on much the same footing : bui 
while tnuchiuery is a mere implement of production, man's 
-Hclfarn is also its ultimate aim. We have already been occd- 
piod with the (question whether the human race as a whole 
gains by carrj-ing tx> an extreme that specialization of func- 
tion which causes all the raost difficult work to be done by 
a few people: but we have now to consider it more noarly 
with special referGuue to the work of business maoagetneat 
The main drttl of the next three chapters is to inquire what 
are the causes which make different forms of bu«inc«s 
management the fittest to profit by their cnvirDument, and 
the raost Likely to prevail over othere ; but it is well that 
meanwhile we nhould have in our minds the quettlion, ha^l 
fiir they are severally fitted to benefit their environment ^^ 

Many of those economies in the use of specialized skill 
and machinery' which are commonly reigarded as within the 



THE ECONOUr OF SKILL. 327 

reach of very large eBtablishmenta, can be secured in a great book 17. 
measure by the concentration of many small businesses of a * "•" • 
similar character in particular localities : or, as is commonly 
said, by the localization of industry. This subject has such 
important bearings on much of our future work, that it will 
be worth while to study it with some care. 




EvBD Id 
ewly 
eUwMof 
dTjltealiiin 
there haa 
bowu coii- 
Blilembte 
trtkfflciu 
Unlit Hid 
vnloaMn 
wiir««. tli« 
prodnction 
of whicli 



§ 1. In an early stage of civilizfltion every place had to 
depend on ite owu resources for most of the heavy wares 
which it conaumeMi i unless indeed it happened to have special 
facilities for water carriage. But the slovnicisa with which 
customs changed, mode it cosy for producers to ini.'ct the 
wants of conaumers with whom they had but very little 
communication; and it enabled comparatively poor people 
to buy a few expentdvc goods from ii dietanco, in the aecuritj 
that they would add to the pleasure of festivals aud holidays 
duiing a life time, or perhaps even during two or three life 
timoe. Coneequently thy lighter and more expensive aiticlos of 
dress and personal adommont, together with spices and med^ 
kinds of metal implemeutB used by all clasaei^ and many otii^| 
things for the special nse of the rich, oftcm cnmt* from 
astoQiKhiug diHtaiicaa. Souii* of these were produced only in 
a few places, or even only in one place; and they were 
difFused all over Europy partly by the ageuey of (airs' and 
professional pedlars, and partly by the producers theuselv^s, 
who would vary tlieir work by IravelUug on fo(»t for many 
thousand mites to sell their goods and see the world. These 
Btunly travellem took on themselve^i the risks of their little 

I riillH III Uie riK^anlH of tLe Sluurbrtilge I'tir lielil near CuubriAic* «• S>il mi 
en>d]eM viirisly of li^Ut and prerions cmhIh trow the oliter M«ta of cfrfllntian In 
Uic EbbI and on Ui« M«ditciTFLDi>aii ; »om» lia<riii£ Into brMglit in tUliUi aluiHi, 
uul iiUivr* buTiiig trnvvllml l<j tux) W tlun Hnjim) Town* and UtMia* bf ■(■ to 



Uzeu 1XDU8TRI1 



329 



they c-uabled the production of certain ola&ses of 
goods to be kept oh the right track for witisfjniig the need* 
of purchasers far away; and they created new waiitK among 
conHiimers, by showing them at fairs or at their own houaw 
new goods from a distant laiid'. 

This concentration of special groups of industi^' in par* 
ttcohir localities, or the " localization of industry " ag it is 
commonly cnlkd, began at an early stag(> in th<' world's 
history; and gradually pn?pared the way for many of the 
modem developments of diviiiiun of labour in the mi--chanical 
arts atid in the task of business management Even now 
wc find industries of a primitive ^hion localised in retired 
villages of central Europe, and sendiug their simple wares 
even to the busiest haunts of modem industry. In Riisnin 
the expniiaion of a family group into a village has often been 
the cause of a localized iudustij-; and there are an immense 
uumber of \Tllage« each of which carries on only one branch 
t'f production, or even only a part of one. There are for 
iustancc over 500 villages devoted to various brancht-s of 
woodwork ; one village make? nothing but i^pokes for the 
wheels of rehiclcs. another nothing but the bodies and so 
on; and indications of a like state of things are found in 
the histories of oriental civilizntions and in the chronicles of 
mediieval Europe'. 

§ 2. The cause* by which localized industries have been 
originated arc various. But the chief of them have been 
phyidcal conditions; such as the character of the climnte and 
the soil, of minps and quarries in the neighbourhood, or within 
on*j access by Innd or water. Thus metallic induRtrie.s havo 
generally been either near mines or in places where fuel was 

^H^'Not •nor} ton( aflo trriTcllon iu Wentem T^rol uinld ftnit > Ktranoe uiil 
^Klnctcririio nlk ot this liabtt ia » rillii^it ctdletl Inut. Tbo lillaicer* biul 

auturtwm aoqnirvd ■ tipt«i«l ftrt In brtrdlne cuimrim: anil IWu jontiit iiii-ii 
, Marled for ■ lour to dutaul |>artH ul Kitr<ip« i-ftcli witli ilwut (Utj hurII cngBa 

hmg tram a paUararhiB ilionlclDr. inn\ wnlkaic] mi till Uirj' huJ si^lil ill. 

> TbtU It* tlMtUue ire fnad |,ltogrn' Sir Ctntttritj of Wori and Wagn, Ch. 
tv.l sf • kwr*T'ii likiijy ImxA wrill«ii about I'UO, wliieli makM noU of tckrl^t ■! 
Uacwki; Uaakfrl ftl Slisb; Vurnctnt Ocvcrkr; nisaot atColdinttj'i Uneii tkbriea 
■t SfcafkabBrr, Levco. uil Arbilaaiii; curj at Wwlcli ami Briiliwrt; kiiivot ■! 
HuvUad : MedlM ai Willoii ; ruon at LricMCn ; sim]i at CovL-iitry : hune idrtlu 
ftl DsocMtOT; ikln* aiiil tnn al CIirrUt and 81]rotrabTir<F ami tin on. 



BOOK IV. 
CB. X. 



locafiood 

kndiutrlta; 
phjslcal 

txiiiiliiittiia; 



3S0 



LOCALIZKX) IN»USTBIES. 



BOOK tv. 
en. I. 




tlitf pat Toil 
Bge (A 



ooarta; 




ratetovUS' 
mlan. 



cheiip. The iron industries in England first sought the 
ilifltricls in which clmrooal was jjk-utiful, and aniirwards ihej 
went to the ueighbouihood of collieries'. Staffordahire make* 
many kinds of potti^rj', all the inat'tiriiils uf which are im- 
])orti'd from a long distance; but she has cheap coal and 
excellent day for making the heavy "siiggim" or boxw >^H 
which the pottery itt placed whilt; being fired. Straw plaiting; 
huK its c-hivf home in BvdfordabirB. where straw hof! jutt Iht 
right proportion of sUex to give strength without britUvness. 
and Buckinghamshire beeches hnvc a^brded the? miit>:-nAl t>r 
the Wycombe chaimiaking'. The Sheffield cutlery trade 
due chiefly to the <-xcellent grit of which its grindstones 
made. 

Another chief eaiJBo has bo«n the patronnge of a con 
TliL' rich folk thyri? aaseinbled mak« a denmnd for goodx 
specially bigh ijuahty, and this attracts skilled workmen 
from a distance, and u(lucat(>H th>0Ni> on the spot \Vht*ti 
JCastem potentate changed his rosideuce — and, partly 
sanitary roaaoiut, this was constantly done — the dc 
town wa5 apt to take refuge in the developtneut uf 
specialized industry, which had owud it« origin U» \\ 
presence of the court. But very often the rulers deliberately 
invit«d artieaus from a. dist&nco and settled them in a gn>up 
logcLliL-r. Thus the riechamcal faculty uf Lancashire is » 
tt) be due to the inflaence of !Normau smiths who vc 
w;ttlcd Itt Warrington by Hugo de LupuK in William 
Conqueror's time'. While the greater part of England'smani 
facturiug industry before the era of cotton and ebeftro had 
its course directed by settlements of Flemish and Huguenol 
artisans; many of which were made under the immc<liu.to 
direction of Plantagenet and Tudor kinga These immigrantt 
taught us how to weave woollen and worsted stufia, though 
for a long time we Rent our cloths to the XctherUttda to 




Tuup 

% 



^ 



' Tli-c btor WDjidviinKs of Uie trou iuiliiitry from WoIm, BUSurdabirr aiid 
SlirfijMliirc Ici Sc^ifUuuil auil lite Noitli al KuitlmicL axv wdl abown in tlici Ulilm 
BubujitU^t \iy SLr liovlbiiiii Itdl t« 1lii< r«niiit CoiiiiiiiiUitnn an tlie ttrjfntaiaa iH 
TTtuln wiJ Iiuluntrj. Siw Uioir SociHid Iti'iiort. Fwt i. p. Ma 

' A gDcA ftccnaiit al Uia "liu'iliuul Iinudieraita in Ui« Bontii MU]«(nI agit- 
coltnrAl diatriclB " is gireu in tin.' Cuai(iuiioti U Uic UriUili Almaiifct for UKl> 

■ SuIIm' Lift of t^tumytki p. 307. 



THEIB VAJLtOb'S OUIOIVS. 



331 



lUed an<l dytsi. They tsught iis how to cure herrings, how 
Ut mauufactuiv ailk. how to uiake lace, j^la&s, and paptir, and 
to proridu for uinny other of oiir wants'. 

But how did tht-ae imiuigmrit*! learn their skill? Their 
aocestore had no duiibt prufited by the traditional artJ- of 
eorliej civUizatiunx on the Kliorcd of Lhi: M«dit«miiican and 
in the far East: for nearly all important knowledge has long 
deep roots stretcbuig dowuwards tu diBtuiit timt-n; aud so 
widely spread have been these roots, so ready to send up 
shoots of vigoroii!< lift;, that then; is pt-rhups no part of tht: old 
world in which then; might not long ago have tlotiriohed many 
beautiful aud highly skillod induHlries, if their growth had 
been favoured by the choraotcr of the people, and by their 
social and political institutions. This accident or that may 
have detcnnincd whether a {>fu-liculaT indnstiy tiouriehed in 
any one town; the iodu^trial character of a whole country 
cv«ti may have b4.>«D largely tnSucucod by the richness of 
her soil aud her minen, and her tacilitie» for cotnmcrce. Such 
nntund ftdvantag<?s may themselves have stifnulate4 free in- 
dustry' ajid euterprise: but it is the exit^tence of ihese last, 
by whaiover m«anM tliej' may have bten promoted, which 
has been the supreme condition for the growth of noble 
forms of tho arts of lify. In sketching the history of froo 
iudustiy aud enterprise we have already incidentally traced 
the outlines of the cau>ie« whicli have luealizetl the iudutiirial 
leaderehip of the world now in this r<nuitry and now in that. 
We have M.-eu how physical nature acts on maiiH energi««, 
bow he is KtimnlaUK] by an invigomling climate, and hnw 
he is encouraged to bold venturett by the opening oiu of 
rich Belds for his work: but we have also seen how the use 
he makes of these advantages depends on his ideals of life, 
how inexuicably therefore the rultgtou«, political and 

iconomic thnsul* of the world's history are interwoven; while 
together they have been bcUL tiiin way or that by great 



DOOR ir. 
oil. X. 



Tlwiii- 

Ulf lit of 

tialUiiis 

waits upon 

opiHirtmii- 

iIm: lint 

kU mttimiH 

luvu bail 

(ippartniii- 

lura. 

It l«i(U<kV' 

iii£iim1 I17 



whi^bltwlf 
i>Uie 
pitidnot of 
maiir 
vauHoii. 



1 Fuller •»;« thit naming stuud mkuiiTarlDTaa «f oMh* nd fuAlrai tai 
lerwicL, Af 1*1x0* in SbiHioi?, nf *»r|{M 111 Colohottor ui4 TmbtM., at daOitt im 
Kent, CU««M«tcnb[n. Wor««t«aldrh WMtlu9r«lftu<l, Vcrkvlitre, ElBubi. Berks 
■nd SiUMZ, of kenwT* lu Duianblr* uid ut l«vMit cotttnu tu LuicwtUii*. 
SihQmi' ffujpifuoU ■» finffltfnrf nnrf Inland, v. 109. 



332 



UKA.LIZED IKUUSTttlES. 



llOi>K lY. 
CU. X. 



of localikcd 

in4n«tri«B; 
bercditvr 
akilli 




tli« (irowUi 
of mil^ 
lUriiary 



tllv UPM) n[ 
bitiixls 



political events and the itifiucncu uf the strong pctnuulili 
of individuals. 

The causes which determine the economic pragruss 
nations vdll require farther study when we come to diacuas 
the problems of inteniAtiona.! trade*. But for the }>rc8cut \^_ 
must turn a*idc from those brondor movements of the locaU 
zatioB of industry; and follow the fortunes of jjr>Hps of skil]e<J 
workcre who are gathered within thp narrow boundaries 
a manufacturing town or a thickly peo]>led indiisitrial distrit 

§ 3. When then an industry has onoe chosen a k 
for itsc4f, it is Ukfly to stay there long: eo great are tJ 
advantages which pRople following the same skilled imde 
get from near uetghbourhood to one another. The myfiteries 
of the trade become no mysterie*; hut arn as it were in the 
air, and t-hildrtn luani many of them uncunsfiously. Gooil 
work is rightly approoiatod, inventions and improvenients in 
miichinery, in proemiHeii and the general organization of the 
business have their merits promptly discussed; if one man 
start* a new idea it is taken up by others and comhhiwl 
with suggestions of their own; and thus becomes the souflfl 
of yet more new ideas. ^^ 

An(i snbsidiaiy trades grow np in the neighbom*hood, 
iiupplyitig il with implcrnuntH and mati-naK organiziDg its 
traffic, and in many ways contlucing to the economy of y 
material. 

Again the economic use of expensive machinery 
sometimes be attjiined in a very high degrue in a dinlricl i? 
which there is a large aggregate production of the same 
kind, even though no individual capital employed in the 
trade be very Inrge. For subsidiary industries devoting ihem- 
selves each to one smalt bmnch of the pn>cosK of production— 
and working it for a great many of their ocighbours, m^ 
able to keep in nonstont use machinery of the most highly 
specialized character; and to make- it pay its cxpcuseft, though 
its original cost may have been high, and its rate of depre- 
ciation very rapid. 



I 



' Meanwiille att^atfuu iiisj lie cajl#<l to lui ultda an TK* MtiffruHu»t] 
Oti,hi4 oj [ailoMrial Knirgy bf Mr CnnrUi«7 in Ihe Fbrinightljp Bcilvw 
DccoinW 1878. 



TUEU ADVANTXOBS. 



33S 



Ag&in, ill all but the earliest stages of economic dovelup- 
ment a ItioaliMd industry gaius a grtiat advauta(^« from the 
fact that it offen a constant market fur skill. Emplo^trs 
arv apt to ivaort to any place where they are likely to Bud a 
good choice of worker* with the special skill which they 
reijuire; while tneii seekiug emp]oyin«iit naturally go to 
l^act^ when: they exp<!ct to titid a gtxxl market for their 
skill, in consequence of the presence of many empioyeni 
who require iUi aid. The owner of an lAolatud lactuiy Ih 
ofleo put to great Hhifbi for want of Home spt>cia] skilled 
Ubour which has suddenly run short.; and a skillod workman, 
when thrown out of emplojinent in it, haa no easy refujfc. 
Social forces here co-operate with economic: there art? often 
strong &icnd!>hipB betwouu employers and employed; but 
neither side Ukee to feel that in codo of &uy diisagruuable 
incident happening bctwocu them, they must go on rubbing 
agoiodt one another: both eides like to be able easily to break 
off old associations should they become irksome. The«ie diih- 
culbes are Btill ver>' grcut, though they are being diminuhed 
by the railway, the printing press and the telegraph. 

On the other hand a locailzud industry' bax Home disad- 
vantages as a nuu-ket for labour if the work done in it is 
chiefly of one kind, «ucli for iiigtatict* as eun be done only by 
strong men. In those iron dUtricts in which there are no 
textile ur other factories to give employment to women and 
children, wuge^i ore high and the cost of labour dear to the 
employer, while the average money earulugs of «u;h family 
are low. But the remedy for thi.<i evil is obvious, and is 
found in the growth in the Kuuie neighbourhood of induKtri«K 
of a supplementary chanicter. Thus textile industries are 
coiistanity found eongregated in the neighbourh<Mjd of mining 
and engiuetiring industries, in some casas having ht^en attmct- 
od by almost imperceptible steps; in others, as for laslajict' 
at Banow. having been Ktji.n<;il deliberately on a large scale 
in order w give variety of emplo^'ment in a place where pre- 
>uslv there hnd been but little denuuid for the work of 
>meu and children. 

Tho advantages uf vari«ty of employment arc combiimd 
Ith those of localized industries in enme of onr manufacturing 



DOOK IV. 
flB. X. 

a luml 

RtWfilll 

Hklll 



llOWI>k-«T 
& llMTAlilUv] 

malmi too 

mlt'LIHiVd 

di-Diaiidfl 
tor one 
kitiil nf 
labour. 



a3+ 



LOCALIZBD IHnUaTHIES. 



Voat IT. 
CH. X. 



Vi&creut 

iniliuitrieii 
In Lhi> *vaa 
luilllitNiur- 
blKHl uiitl- 

otbnr'* ilo- 

pPdHllloiill. 



Ilia In- 
tmaaeaot 

muiiBol 

QftUooon 
Uwno- 

tJMi of 
iii'ludlriciii. 



towns, and this in a chief cause of thpir continued 
But on the other hand the value which tliu ceiitiul site* of a 
large town have for trading piiqxiacti, nnnbles them to com- 
luand much higher grotiud-rcubs thoji the situations an- worth 
for ketones, even when account in taken of this combiuutioii 
of advuitngCB : and thurc in a, ^iinilarcumpetition fordwellinj 
sptice between the employ^ of the tiding houses, and 
fiictory workcre. The n;ault in that factorieti now congivj 
in th« outskirts of largu towns and in manufacturing distric 
in their neighbourhood rather than in the towns the 
Mclvea*. 

A district which ia dependent chiefly on one industry^ 
liable to extreme depression, in case of a l&lHng off in the 
demand for its produci*, or of a &Uure in the supply of the 
raw material which it nscs. Thin cvi! again U in a grc*t 
measure avoided by thoss largo towns, or largo industrial 
districts in which 3cvcrnl distinct industries are strongly de- 
veloped. If uuo of thj^ui fails for a time, the others are likely 
to support it in many wnys, ehiefly indirect; ono of theso 
being that they keep in heart the local shopkeepers, who ore 
thuH enabled to continue their as-iiistnnce longer than they 
otherwise could, to the work -people in those tnuloR that 
happen to be dcpresi^ed. ^H 

§ 4. Every eheapc-uing of the irieans of cotnmunicaticni, 
evpi^' rii^w facility l'i»r the free interchange of idess beCwoe^^ 
dititanL places alters the action of the forces which tend ^M 
lociilize induRtries Speaking generally we may say that a 
lowering of tarilTs, or of freights for the transport of gooc^_ 
tend» to make each locality buy more largely from a d^| 
tance what it requires; and thus tends to concjentrate par- 
ticular industries in special localities: but on the other 
hand every thing that increases people's readincsji to 
migrate from one place t^ another, tends to bring skilled 
artisans to ply their crafts near to the consumers who will 

1 TUp laovniuimt faua bran gpwlAll; Mmipicaou In tlw van of Um tniSB 
munnrArltiMH. MinrlicKl'r, I.t«i\u nnil Ljviiir uw «till ebU MnttM of the OtHii 
ill rotlun. KAoll«a «ii<l tillc «tnil». I>ut Uipy do not bow tlieiaMlvM prodacv aaf 
gTvat |>Hrl v( tlii> Koixla l<i wbkb thiij ••%*• ILvtr idilrf (iitii*. On |bc otber band 
Luiiilou »iiil I'nrLii rrUiin Llirlr |Hi>JlioiiH ta tlin (wo InrKcnl ninnnhMt«riii|t lowii* 
of Qie world, Plll1Mll^l[lUla ooiului; Uiinl. 



MOVBMENTS OF ENOLUIU ISDL'STKIES. 



8s; 



pHretiaeo thvlr wares. Thtrse two oppoaiiij;^ tuinli-'iidee lire 
rell illuatratecl by the recent hiatory of the Euglieh people. 

Od the one hand the xtuady chL-apening of frcighto, the 
openiag of raUvi-a\-s &oui the a^cultttral disthcte of America 
niwl ladia lo the sea-board, and the adoptiou by Engioud of 
a firee-trade policy, have led to a groat itcrt'aae in her impor- 
tation of raw produce. But on the other hand the growing 
cheapneEB, rapidity and comfort of foreign travol. are in- 
ducing her trained busioeus men and her skilled artisans to 
pioD«pr the way for new industries in other lands, and to help 
them to manufacdiro for thoai&olvos gouds whieh they have 
been wont to buy from England, English mechanics have 
taught pciople in alma»t every part of tho world how to use 
EngliNh machinfifj-, and even how to make the machinerj' 
lilie it ; and Kugli^h miuers have opened out niines of urv 
which have diminished the foreign demand for many of 
EnglaDd's products'. 

One of the most striking movcmenttt towardH thu speciali- 
zation of a country's industries, which history records, ts the 
rapid increase of the non-agricuUurat fx)piilatinn of Kngland 
iu rt^ent times. The exact nature of this chaiige is however 
liable to be misunderstood ; and its interest is tto great, 
both for its own sake, and on account of the illustrations 
it aflbrda of the general priuci]>le« which we have been dis- 
cussiDg in the preceding chapter and in this, that we may 
with advantage pauee here to consider it a little. 

In the Hmt place the re^ diintuution of Gaglmid'^ agri* 
cultural industries is not so great na at lirst night appears. 
It is tnie that iu the middle ages Ihme fourths of the people 
were reckoned as agricnltmialfl ; that only one in nine was 
gtnmcd. to the last ceu3us as engaged iu agriculture, aji<l 
kat perhaps not more than one in twelve will be so returned 
next census. But it must be remembered that the 
WVealled agricultural population of the middle ages were not 
exclusively occupied with agrieuUure ; they did for thcm- 

I Xb» hi^ itit«IU(Di)ce of tlie Coniiali lueu Iiiu iraui1)iii«l wilti (lie caiapantiT* 
poverty ttf tlieir mni BdaM to dmIp Ibniii uko Um> ImwI In ChU morement: uul 
Uif«*WB matA to Eo^and bam duuujt vnotiuenU p«rU of tba tiu ami eojtptr 
wbkt «ot«t into mu? of Iwr Enoit T&liublu •xporto; mmI that In uaae wij* 
fncnMM lb» flpvdaUnUou «f hm iiidii»tri««. 



BOOS rr. 
ca. X. 

ninatratioa 
from U») 

lAtUirj of 
Kn^anil, 



TUa «ff(icU 
un hrr 

ikjrTir^n]tiir« 

u[liji<r«aiied 
ilntnrta- 
lioii ii( mw 
prDilnre. 



Ttie itliuiii- 

uiiuoufbur 
Bprieultn- 
ral poinilft- 
tiui) Ih let* 

til Mil nt 

lint HJulit 
»IiIK«rK. 



3S(3 



LOCALIZED IXDUSTitiES. 



UnOK 

OH. X 



ir. 5elve» a great part uf thu work timt ut now done by brewc 
ariil bokere, by spinu^rs and Mreaveis, hy bricklayers and car- 
penters, by drcfwiuakera aud tailors aud by luauy other trader 
These self-suffidog habiU died elowly ; but most of thera had 
nearly disappeared by the bcgiouing of this centmy ; and it 
i.s prubabic that the labour speat on the land at thia tii^H 
was ni»t much less a part of the whole industrj- of the coanti^^ 
ihau iu the middle ages : for, in spite of her ceasing to export 
wool and wheat, there was so great an increase in tho produce 
forced from her soil, thiit the rapid improvement in the arts 
of her agrieulturists scarcely availed to h^ld in check thi 
action of the law of DitiiiruHhitig Kt^turu. But gradually 
great deal of labour has been diverted from the fields 
makiug rxpHUtdve niachinery for agrieulliiral piirpoBcs. Tl 
chaiigo did uot exert its full influence upon the numbers of 
those who were ntckuiuBd a^ agrieiilturiKt'S so long ae the 
raaehiiiery was drawn by horses: for the work of tending 
them and supplying them with food was regarded as agri- 
ciiktural. But in n^ent years a rapid growth of the uflH 
of steam power in the fields has coincided with th« iocrease^^ 
importation of larni produce. The c^isl-Diinere who supp ly 
these Hteam-engineH with fuel, and the uiechamca who ma)^H 
them and manage them in the fields are not reekootH) a? 
occupied on the land, though the uUiuiate aiui of iheij 
labour is to promote its cultivation. The real dimiDUlit 
then uf England's agriculture ia not so great m at first si{ 
apjjcaxs ; but there liiui been a change iu its distribution. 
Attention has already been called to the Lntluenoe wbich 



irts 



thei^^ 



triiintioij the iniportatiuu orugricultimd produce exerts iu altering the 
coitird^" relative values of different soils: those falling moat in val 
prf"'"''"" which depended chiefly on their wheat creps, and which wi 
loiuitr;. uot naturally fertile, though they were lutpabte uf b<dng made 
to yield feirlygood crops hy caponsive methods of cultivati 
These districts have contribxited more than their share to 
crowds of agricultural labourer* who have migrated to 
large towns ; and thtis the geographical diatribution of indua? 
tries witliiu the country has been etill hirther altered, A 
striking instance of the in^uencc of the now means of trans- 
port is KGcr in those pastoral districts in the remoter partfi 



ilu^ 
ire^l 
lade 

1 



^CREASE OF INOCSTRIES WHICH USE UTIXE MACHISEBT. 



United Kingdoni, which scud dairy products by epedal 
exprc'jts traina to London and other large towns, meanwhile 
druwiiig their own eupplics of wheat from the further shores 
of the Atlantic or even the Pacific Ocean. 

But uext tho ohaDg«8 of reeeut years have not, us would 
St fimt sight appear probablu, increased the proportion of the 
Enghsh people who are ocoipiwl in manufactures. The out- 
put (if Enjjlaiid's iiianufacturM is ctrlainly several times bs 
great now ae if was at the middle of the century; but those 
occupied iu manufacture of every kind were not a larger 
perccnta^'C of the population in 1881 thoii in 1851 \ Thi« 
result is the more otrango when wc recollect that among the 
maniifkcturers are reckoned those who make the macbincij- 
and iniplemctitu which do so great a part of the work of 
English agriculture. 

The chief cxploiiutiou of this result lies in tho wonderful 
iDcrcAse in recent years of the power of machiaery. Thiii 
has enabled us to produce ever increasing eupplics of manu- 
factuTCfl of almost every kind both for our own use and for 
cxportatioQ without requiring any coosidcrablo iucreoeo in 
the Dumbor of people who tend the machiuea And there- 
fore we have been able to devote the labour set free from 
agriculture chiefly to supplying those wauts in regard to 
^■Khich the Improvement.^ of machinery help us but little : the 
^Hifficiency of machinery has preveut4^d the industries loca- 
^ftzud in England from becoming an exclumvely mechanical 
^as ihey otherwise would. Prominant among the occupations 
which have increased since 1H51 in England at the expense 
of agriculture are education, domestic service, building, deal- 
ing and tnui.'iport by road'. In none of these is vory much 

' Mr B«otb in hb wltoirkblo f«ptr On QCCiipativnt in lli< United KingAoin 
UOl— tffil, piibUilitd la Uie Statlctical Joonukl for \i^, HeiMiaUa h well u liu 
can Ui« iImIwi Irmn Uic utiumTAiclartTii: and fituli tlmt Uidmi unsi^id in diuiu- 
fHtun nra SZ'T per ceul . (i( Ibiow ••mliiii iiicleiieiideiii liirajDm In ItUl auil mil; 
Wf par emit in IMii. 

> Of MOTM Iranqiorl by nilwajr. wbich U m nvchnnlfal tiidiutt;. or«apiM 
mon people Uian il ^A \ for it ia tmlj «l rMMDt «ri|^. But tli« nhipiqng imtnilr]:' 
b «< «U dalv; tiA tb«r* wc tsA llut notol Bwch»lit««l bnproTi^iuuuU liavo 
wMiri ft traflta IncnMKid (itarfolil to be eanrictl wltlinnt aaj IncrcMe in Uio 
BTHnlfft *A tbow vlui wta\ It. Kvcvpi In tlie malti-r of tramvaji tho* bu 
fcaM BO oomMenlilo fatqiiDrtauuiit in Uw vuhidw OMd on tkn mndii. ami a earn- 
ue iu tralflc] bf toiA bM euued tluMw vha work il ta 



HOOK n: 
oil. X. 



TboMi 

IrMfrom 

atcrinilCuriB 

harp Bono 
iiul to 
maun' 

faollUM 



but cLleO; 

to ■ latino 

triw iu 
nhicili 
lltvrv htm 

bWD Till 

(ffeat 
liicrcoM 
in tlln 
elDci«iiCT 
of labour. 






S2 



338 LOCALIZATION OF INSUSTRIEa 

Booxrv. direct help got fiwm new inventions; man's labour is not 
°°'^ ' much more efficient in them now than it was a centiuy ago : 
and therefore if the wants for which they make provision 
increase in proportion to our general wealth, it is only to 
be expected that they should absorb a constantly growing 
proportion of our indtistiy. 
^Msition Passing away from thia illustration of the action of modem 
subject at forces on the geographical distribution of industries, we will 
ch»pt«. resume our inquiry as to how far the full economies of diri- 
sion of labour can be obtained by the concentration of large 
numbers of small businesses of a similar kind in the same 
locality ; and how far they are attainable only by the aggre- 
gation of a large part of the business of the country into the 
hands of a comparatively small number of rich and powerful 
firms, or, as is commonly said, by production on a large scale. 

iucreaae in nnmbera foster than tHose engaged in Almost Kay other minnri occo- 
pation. 



CHAPTER XL 

INDCSl'BIAL OROANtZATlON, COKTISUED. PRODUCTION 
OX A LARtiE 8CAI.K. 



§ 1. The advantages of production on a larj;e scale are 
best shown in miumfacture'; undor which hotui wc may 
include all bufiinoesifs engaged in working up material into 
forms in which it will be nxhipt^d for .lalc in dititant 
markets: the rhoractemtic of inauufocturiug industries 
^liich mskeii them offer gcnonillj' the best llluKtrntionit a( 
ie advaotages of production on a large scale, U their power 
of choosing freely the locality in which they will do their 
work. They are thus contrasted on the one baud with agri- 
caltare sad other extractive industries, (mining, qunnying, 
fisliiiig eta), the geographical distribution of which is deter- 
mined by nature; and on the other hand with industries 
that make or repair things to suit the special needs of indi- 
vidual consuniem, from whom they cannot bu far removed, 
at all events without great loss. 

The chief a<)vantage« of ]inxtuction on a large aeulc arc 

inomy of skill, economy of machinery and economy of 

_tnttU'rials: but the last of theio is rapidly losing import- 

Bce relatively to the other two. It is true thab an isolatc^d 

rkmau often throws away a number of small things which 

ikl have be*n collected and turned to good account in 

bat waste of this kind con scarcely occur in a 

> "MuinlMtsM" ii ■ Uno wtiicb luu loug lost kity tvnuortioD wiUi ita 
«ri|{iiHkl oMi: »aA '» «aw ajiplicU k> LIiimo l»uii:bM vt jinHluuLiou wbuiv uBctailM 
■ad sat haad wvrit u tuoit praminrnt. Busditir made tlic altvnipl U> bring it 
back nmm to lla oM wa bj tii^Hyhtg it to iloiueatic ■■ oivowd to fictor; 
iulnatriai: but it in loo lata to da thbtnow. 

* Sa* Babta^fe'i '«■"■"'" of tin nunnlutiire ol liota. tUaaam^ of Momu- 

ftetmnt, efa. tXU. 

2S— 2 



>oaz IT. 
CK. n. 

Thnt]n>i<«) 
liidnimM 
fflr ftiiT 

parpo*carp 

tboM 

enitai!«d la 

□laiin- 

facturv. 



Thi; 
niatuHal. 



340 



PBODUCTTON OK A LARGE SCALE. 



DOOK IT. 
CS. II. 



Tho UlTAH- 

ta^us uf • 
ractoiT ft* 

■ItupinJiunl 
oiBchiiicry. 



locnliised manufacture even ifit U lu the hands of e 
mid there is uot very much of it- in any branch o 
in modi^m England, except perhaps in agricultttre ftnd in 
domestic cooking. No doubt many of the most unportaut 
advances uf rcccut ycais have been due to the uliltziitg^ 
of what had been a waste* product*; but this has been 
generally due to a disiinot invention, either chemical or 
mechanical, the u^e of which has been indeed promoted bv 
minute ttubdivisiun of labour, but haa uot been directls 
dopeudent on it. Agaiii it is true tbat when a huoc 
suits uf fiiruilupe, or of clotliing, have to be cut 
on exactly the saniR pattern, it Is worth while to spend 
great care on so plauutujj the cutting out of the boani» 
or iho cloth, that only a few .tmall pieces are wasted. But 
this is proptsrly an economy uf skill ; uue planning is mad? 
to suffice for many tofikit, and therefore can be doue well and 
carefully. We may pass iheu to the ecoiiumy of maehinfn,'. 
§ 2. In »piU'- of the aid which Hiihsidiary industries am 
give to small manufactures, where many in the same bnuich 
of trade are cnlleeted in one neigh boiu-hood*, they ore ftill 
placed undur a grea.1 disadvautagt; by the growing variety 
and expensdvencs.-! of ina<!hincrj'. For in a lai;ge establish- 
ment then; are often many expensive machines each made 
specially for one small uhc. Each of them requires "ptUM 
iii a good light, and thii» standti for something considerafa^l 
in the rent and general expenses of tbu factory; and 
independently of iutereot and the expanse of keeping it iii 
repair a heavy allowance must be made for depreciation in 
consequence of its being probably improved upon bcforv 
long', A Hiuoll mauufoctuier must therefore have ma 



I InsUueaa me the otilix&Uoii uf the vtMe troea cottou, wool, liUi ttnd vU«r 
textile iiuit«rv«Jai auil of the bjo produol* in tlio uvtaUuritivAl btdnatriM tuA u 
tbo imuiulMnnrc of WTiln Mid gun. 

> 8m ILe pTccnllriK cbapler, | 3. 

■ Tlix KT«rae» tint) wliidi & nianbiuB will lut twfon twitis iioporaeilHl U lu 
muijr traiica not mor* liiaii tltt««n jrcan, while In Mine It ti Uoi jraan or •roa 
Icm; tbtrnii aft«n « Ion omthooaoot ft mMhinomJe— itnomi evny jtimt tvmlf 
prr ctiit. on ita coal. Wbni tJignJon Ui« op«nti«oi portonncd bjr » "■"**"- 
cuittiQit .£1100 miAt ouiy > Unndrvdtb part t« tlis raliw ot tha tiwtvrial Otai |»mm 
tbroag]! it— «iul tlila ift uot an eitracae c«ao— tliefe will b« a low obUmw vnlmt 
It am be tpidiBil tn i>TQ(lnriiiB nt l«Mt f lO.iXU worth tit goods uubiUj. 



i>TANTAOES IN THE USE OF HACHIHEBT. 



S41 



lone by hand or hy imperfect nmcliiiicry. though he 
ow to have them done better and cheaper by special 
roachinery. if only he could find constant tmploymeut fur it. 
But next, a i^mall munufacturer may oot always be 

liiainted with the boat niaehliiery for Ills purpu^c It is 
truL- that if thu industry in which he is engaged has been 
long establiefaed on a large scale, his machinery will be well 
up to the mark, provided he can afford to buy thu best 
ID the market. lu agricultui'e aod the cotton iuduetries for 
ixistaitcc, improvomcnts in machinery ore devised almost 
exclusively bj maohine makers, and ar« accessible to all, 
at any rAt« OQ paying a royalty for patent right. But this 
i« not the ca8« in induatries that are as yet in ftn early 
stage of development <ir ore rapidly changing their form ; 
such as the ehemieal Industrie*!, the watchmaking industry 
and wtme branchts of the jute and silk manufoctureH ; and in 
a host of trades that are constantly springing up to supply 

lie new want or to work up fwme new material. 
In all such tmdce new machinery and new pn3ce«se8 are 
for the greater part devised by mnnufacturent for their own 
U8& E^h new deparimre is an experiment which may fail ; 
thoHe which succeed mu^t pn.y for themselves and for the 
failure of others; and though a small manufacturer may think 
hi: outM his way to an improve m cut., he iuu»t reckon on having 
to work it out tentatively, at cunsiderable risk and expense 
and vilh much interruption to his other work; and even if he 
should he able to i>erfect it. he is not I i kely t« be able to make 
the moat of it For instance, he may have devised » new 
speciality, which wou id get a large bbIq if it could be brought 
uudt-r geuei-a) notice: but to do this would perhaps cost 
lany thousand pounds ; lud if so he will probably have to 
bis back on it. for it is almost impossible for him to 
lischargo, what Roscher calls the characteristic task of the 

jem maDufacturer, that of creating new wants by showing 

3plc eoraothing which they hod never thought of having 
before ; but which they want to have as soon as the notion 
U suggested to tbcm. In the pottet^' trade for example 
the mnall manufacturer cannot afford even to make experi- 
ments with new patterns and deigns except in a veij- tentative 



BOOK IV. 
Of. It. 



AiItbu- 

t»^*» wilk 
T^lilti Ul 
tlie in Ten- 
tjim of 
liiiproTtd 



ThemkI) 
niiuiitfar> 

torer 
e*miot 
often 
lUIonI to 

maDt. 



342 



PRODUCTION ON A LAliaE SCAUt 



BOOH n. 
ca. XI. 



Sul in 

trail«8 B 
faclurr tif 
ooddratc 

dim am 

LwLt 



way. His chance is better with regiirtl to an imprwvemrtl 
ill miLking thiiigt) for which thitra i;: already a good markeC 
But eT«D here he caunot get the full 1>eDefit of his iuv«ntioii 
unless he pfttODts it'; and sells the right to use it; or borrow 
some capital and extends his 'business; or lastly changes th< 
character of his business and devote* his capital to thai 
particular e(«.jre of iho mauufaoture to which liis improve- 
ment. applieB. But aftor nil siich casnt* are escoptionfti: 
tho growth of machinery in variety and expensivenesa presses 
hani (in the wnnJI manufnctiiror everywhere. It. has already 
driven him corapletiily out of some trades and is &»t drivii 
him out of others. 

There are however some trades in which the advaut 
which ft large factory derives from the economy ofmachii 
almost vanish a» r^oon as a moderatfi sixe has been reached. 
For instance in cotton spiuuiug, and calico weaviug, a com* 
pamtively flrnall fucti>ry will hold its nvm and give constant 
employment to the best knowii machines for every piuccas^ 
so that a large factory is only several panillct Ninaller factor 
under one roof; and indeed some cotton spinners when 
largiiig their works tliiuk it bt^^t. to add a weaving dej 
ment. In such csAes the large biianess gains little or 
economy in machiuory; but oven then it generally saves 
something in building, particularly as regards chiinncys, 
'm the economy of steam power, and in the management 



■' III iitiktif biuiiLDMica oijl^ a huikU iiiTceiUacii cjf impra^Mnenta ant pMcnt 
Thty iMiu«l«l of niutj aniaU HWpm nlilcli It nimJd nnt )<« wnrth wliili> tu painiil 
Olid Al B tiin«. Or thuir chiet paiiit lien iu uolii'iiii.' Uiut a L>4ataiu Lbiug iiUftbr to 
b» iloti« ; will tn i«t«nt oiia voy of AtAiig ft. U only to tuA ntlior l>«aikU td *<)rk 
to fiud out Mkt nmyn of duliig it «g)uiuit iHiioh tUo rAtcnt Mniiol f^»H. U one 
ITftlciil is t*licu uul. iUnuttvc] uovrnMry to "block" It.liTPktwIiiiK otbw iDCtkn^ 
ul ■irlvLuent tliri xanic ruimlt; tlut pAlcutcn ilnuK not Mpeot to nao tbcm btoucKi 
bal he ivanla l-o prtiveul olhun from niitix tliMu. All UUs Inndm wvay anS 
low of tlinn aiiitmnniTy; and tbn laxgu nMuufm-'tunar |ir»ierm to kmup taa Im f t m i^ 
mmt to liitnteU unrl gi<t what hniixHt lin' rati by niijiig it. WbUn U Uie anall 
iiisiiufictnniT labDn ont a patunt. ho {■ likely to be luMMed by itiMiiC''aifnilJ>; 
and «rc)i tlionijti be tuav uui " wjtb rtmln " tbp MrtiuiiN in wliich li* Iriev U> 4xteui 
biuuelf, hv in butu M be ruiiii?d by tiimn if tlmo in inaji; of Umu. It U xMiFnUr 
In tba jntUic iulumt th&t aii iiuiiruveuieia hIiuuIiI Iv imbljalied. even tboaali il ii 
at lli« Mma time pateaud. Bat If It )■ ]int>>nt«il In EnsUnd ani) not Id ut^rr 
eMDtriM, M I* oftan tli* suM.EngUiib niuiiuTictiireni wayiiui uau ii. rvcn tbou^ 
tliejr vers JtiM on tb* point ot flodinff '' <"" 'o*' tljAineolTMbefan It naa p«t«fib 
ttUle toniga muiafactturera Icvn all bboat II uti cut di« U tnolj. 



ADVAKTAOES IN DUTINO AND 8BLLIN0. 



34S 



repairs of engines and machinery". Large works even though 
ihvy pruduuc nothing but soft goods, have generally well 
organized carpenters' antl mechanics' shopii, which not only 
duuialsh the cost of repairs, but have the importtuit ad- 
vantage of preventing dela^^'s from accidents to the plant. 

Akin to these last, there are a great many advantages 
which a large factory, or indeed a large business of almost 
any kind, nearly alwaj-s has over a small oue. A large 
bii«iue$t> buys in grt:at quantities and therefore cheaply; 
it pays low freights and saves on carriage in tnauy ways, 
pnrtioularly if it has a railway siding. It often sells in large 
quantities, and thus saves itself trouble ; and yet at the same 
ijme it gets n good price, because it offers convcniencej* to the 
cuetomor by having a largH sloek froin which he cau select 
and at once fill up a varied order; while its reputation gives 
him oontidence. It cau spend large sumu ou advertising by 
eommerwial trnvellers and in other ways; ita agents give it 
tniHtworlhy iiifiinualiou uu tmdu and pereoual matters in 
distant place>«, and its own goods advertise one anothtir. 

Many of those economies in the matter of buying and 
elling can be secured by a large trmling huuse, which puts 
out Us Work to be done by sumll manufacturer or by 
work-people at their own homes. So far thi^refore they do 
not tfll iu the directiou of destroying small manufacturers, 
but ruther of limiting the character of the work of busiueas 
rauoagement done by them ; as we ehdl see more fully in bbe 
next chajrter. 

§ S. Next, w^ith regard to the economy of skill Every- 

ig that has been said with regard to the advautugce 
itcb a large establishment' has in being able to aflord 

> [t l> k nimnrkalil^ tnrt tliat aolton ftiiil imtni nthat laxtiln fiu-torinii inrm 
I «a«aplioii to tlw gpuorkl rule tliBl Lhv «>|<itHl ri>a|Dir«d p*r lio^ o( tliv R'ork- 
I i» pMtcnU}' Kmtvr iii • laorc fMtorj ibau in n uuall nii«. TLe iwuKm is 
tn tM«t oilit* tiuMucsoc* tluT large hcUny bmn inftuj UibigH draic hy 
i[t« nacliiuM sliich u* iluu« hj tiUiA 1b b niiftU incuiTy; to lUat wttHe 
tlia wtgm bin i> !•■■ tu |>n>|KirUon to Uiv oottmt in a Inrne tw-tiny tluui iu a 
MM, Uw rahw of tlie ni»clii]i«T7 unit ibo taittarj •pwc Mwnpleil b,r tbe 
r fa Budi gTMkUr. Bnt In tli« ilmiilor lirtiiclicn at Uui textile IruJii*. 
worin have Uig wwo iD««liiiicii7 ■• large nprkt ln*ai unil bIdvo vaikU 
I raiciBiB, ft«. are proporUunmtol; luDni BijwndTc tlivi Uive mut*. tti*v re- 
ikgnKter flxvdcspdU) In iiruiwrtluQ to llioir ouljmt tliaii tv^vrfarlariodo; 
>wl thv an UImI; to fwinin • doiluiii cai'lui alM> n\h«r spmIot In {iroportloB. 



nooit IT. 

en. It. 



Adrmn- 

afftlum 
tactoiTln 



b«t<rcoa 

tiMMsaiid 
umll 



Advut- 
UuMof 
■ Unie 
tMCUiry 



344 



PRODCCnON ON A ULRQE SCALE. 



BOOK rr. 
CB. 31. 

iU. 



mill iij 

MlllH'tioi^ lit 

uieti f'>r 
«urk wliicli 
rcquirca 
.grojit 
•blUtj, 



Itiut l<t 
foreman, 



Thomb- 
dlvlsian 
of die 
work of 
hnanctM 



highly specialized machinery applies equally with regard 
highly specialized skill. It con contrive to kucp each f^ 
its employ^ conslaiilly eugaged id the most difficult wo^f 
of which he is capa,htu, and yet so to muruw thu range of h^^ 
work that he can attain this faality and exoellence which 
come Irum lung coobiuued practice But enough han already 
been »aid on the advantage of divitiion of labour: and we 
may pa^s tu an important though iudirt-ct advantage wliicb 
a manufacturer derives from having a great many men in 
his cmplo)Tncnt. 

The large manufacturer has a much better chance thaa^ 
small ODC has, of getting hold of men with exocptic 
natural abilitius, to do the most difficult part of bis work — 
that on which the reputation of hi» establishment cbio&^ 
depends. I'hia ia occauionally iinportaut as regards m«l^| 
handiwork in trades which require much taste and originality, 
as for uistunce tliat of a house dc^ecrator, and iu tliuse which 
require exceptionally fine workmanship, as for inRtance that 
of a manufacturer of delicate mechanism \ But in motrt 
biiduesses its chief importiuice lies in the facilities which it 
gives to the employer for the selection of able and tried me; 
men whom he trusts iind who trust him, to be his fo 
and heada of departments. We are thus brought to 
central probkm of the modem organization of indusliy, 
that which relates to the advaiitageit and disadvantage of 
the subdivision of the work of bunineas managemont. 

§ 4. The head of a large business can reserve all 
Btrenglh for the broadest and most, fundamental problems 
bis trade : he must indeed assure himaL-lf that hiit mant 
clerks and foremt-u are the right men for their work, and 

1 Tba« Buiiltnii trritiiiK ill 17T0 wlion ho Iitul TOO or MX) penDiu emjdaxMl u 
metallic itrlliiU uiil workerv in («rtiilH»eljc.-t1, Modm, Hlasi, tuA enund, «aj«:— 
"1 hkTo traiiipfl up niiviij. (uul am trfticuig op ui^re. plain nntiitty IkIb into gnod 
workmen ; ilihI wln-Ti'vrr I Hnil inrlirati'iiiH of (kilJ auid atiiUtf, 1 ciicviin^o Uhih. 
I baio lUi«w1i)o cvwUUticd cDrrmpuiiilciKC wllli kIiuosv tvvrj nwicauUk Uin In 
EuniiK?.BurlBiiii]Liurt'Kulu'lyHnpl>liB<lwltb()r4rra(cirtlirgri)n>ri«tkOMititc«itiinaii 
<leaiKiii1. b; wlilr)i I sin HinMiol b> cinpliij «ucli n iiiini)*rut liaud* «.■ to provMi 
inn nitli mt mi^lo clioit'u uf nrlUti ftir tlii- fiiif-r bnuidie* (if wurk: uid I uii tlnu 
enconrtKe'l to prnct miiI fnijilc}' n nioni cxlpnaiTe 4ppar*lii» thui it woM b« 
prnili^iit to ettiploj for Ibo |>rodDetiuu at tliu fiiioi ftrticl** obtf ." Sinil««' L^^ , 
Bovlltm, p. 138. 



ADVANTiOBS JIND DISADVANTAGES OP LABOE FlltUiJ. 



doing their work vrell ; but beyoDd this he Deed not trouble 
himself much about detMls. Ho can keep hia mind frofih 
and clear for thinking out the most difiicult aod vital 
problems of hit) buuiness; for etudyiog the broader move- 
RientH of the markets, the yet undeveloped re-iults uf current 
eveota at home and abroad ; and for coutriviug how to im- 
prove the organization of the internal and external relatinnn 
of his busiui'StfL 

For much of thii> work the small employer has not the 
le if he bus the ability ; he cannoi take »o broad a survey 
of his trade, or look m) far ahead ; he must ofteo be cuuteub 
to follow the lead of others. And yet he must spend much 
of his time ou work that h below him; for if he is to 
succeed at all, he mu.st have a go»(l deal of originating and 
organizing force; his mind muet be iu some respects of a 
high quality; and his strength in watitcd when he occupies 
himself, aa be must do to a> great extent, with eas)* but 
twliouB routine work. 

On the other hand the small employer haa great ad- 
vantages uf his own. The mantttr's eye is evcrywhen; ; 
there is no shirking by his loreinen or workmen. Agair 
by kueping things himself under look uud kc-y, oud in other 
ftye, be can save much of the book-keeping, and nearly all 
'of the cumbrous .sj-stem of checks that are ncceasarj' in the 
business of a largo firm. The gain from this source is of 
very great importance in trades which use the more valuable 
raetals atKl other expensive materiala 

And though he must always remain at n great dis- 
advantage iu getting iiiformutiou and in making experi- 
ments ; yet in thLt matter the general course of progress 
is on his side. For newspapere, and trade aud l*.'ehmeal 
pubIicatio»j4 of all kinds lu^? perpetually Kcouting for him 
and bringing him much of the knowledge he wants — know- 
ledge which a little while ago would have been beyond the 
reach of anyone who c-ould not afford to have wetl-ptud 
agents in many distant parts. Again it in to his interest 
also chat the secresy of busines!) is on the whole diminishing, 
id thai the most importoub improvementA in method 

ita remain secret for lung after thuy have passed ftotn 



BOOK IT. 
Cll. XI. 

niuiil: tbn 
luge 
nuum- 
iMTtam 
cnu cEvo 
Lin \>'1i<>L« 
■lUitiuUi 10 
tUn mart 
fiiiportMit 
|«rU of il. 



AiItiuI' 

miuin- 
Cncliirer 

tn Elm 

"ork of 



<ll!V?to[l- 
lU Dills <lC 

■1*1 ill a 

iiifttKiir* on 
liii flido. 



Md 



UUtGE SOAl 



nunK r?, 

OH. XI. 



Ailvmi- 

tOfTMot 

bnsdidNCB 
oCDtiur 



Uitdi. 




Inulp 

tbnwe 
on tbo 

iucMWc 



the expfrimeiital suigc. It u ti> IiLs advantage that changes 
in tnanu fact urn depend less on mere rules of thumb and 
more ou broud dL-VL-iopiuenta of scientific principle; and that 
many of tht;Bo art; maiiv hy shidcntti in thr piirttuit of know- 
ledge for its own sake, and are promptly published in the 
general inten--st. Although thenrfore tht:: »mall manufacturer 
cau seldom lie in the fWjTit of the race of progreaB, he need 
not be far fi-ora it, if he has the tiine and the ability fca- 
availing himself of the modem lacilities (or obtaitunj;' 
knowledge. But it is true that he must be cxccptionalljr 
strong if he can do this without neglecting the minor bat 
necefwary detaiU of the butnncss. 

On the whole then the nmall factory can seldom compete 
ou t'fjtml tf^rms u'ith a larger eetab!i»hmetit which iu (irgan- 
ized en the ideally best plan. But as a rule a largo but^tn^ss 
is itself only tbe development of a Eimaller one «'hich 
prospered under gmwl management: after a time the maoa^ 
meut becoiiiOM iiicoinpeteut, or for some other r«a«un 
biidinefft is broken up; and again the cycle is renewed bj 
Other small businessfs pushing their way upwards: But th 
point mn8t be further considered in the next chapter. 

§ 5. The advantages which a largu buiunesB has ovi 
& small one are conspicuous in manu Picture. becauHe, as w 
have noticed, it has special facilities for concentrating 
greitt deal of work in a smiJI area. But there is a stron, 
tendency for large establishments to drive out small ones 
in majiy other induMtriL-s. In particular the rctnit trade is 
being traosfbrmed, the small shopkeeper is loaiDg ground 
daily. I 

I^t lie look at the advantages which a large retail shop 
or i^torc has iu competing with its smaller neighbours. I'a 
hegiu with, it c&u obviously buy on better tennfi, it can get 
its gouds carried mure cheajjly, and can offer a Uirgcr variet; 
to meet the taste of cUEtomcrs. ^'ext it has a great ecoiiom 
of skill : the Bmail shopkeeper, like the amall manufiiciurer, 
must spend much of hift time in routine work that retj 
no judgment : whereas the hcnd of a loi^c establishment, 
aud even iu suuiu casee his chief assistants, spend their whole 
time in using their judgment. Until latoly them odvuttaga* 



3 



ANI> SHALL TRADING ESTABLISH HE NTS. 



3*7 



lave bei^n gunprally oiitwfighwl by the greater bcitides 
which the small shopkeeper has for briiigitig liut goods to 
the door of hut ciistomunt, for humouring thmr several 
tasted and for kuowing enough of them mdiWduallj to be 
able safely Ui lend them capital, in the fonn of selling them 
goods on credit. 

But within recent jeare there havt; been many changes 

all telling on the side of large establish mcnta. The habit of 

buying on crt-dit is paaang away; and tlm personal rclutiuiw 

between shopkeeper and ciifltonier are becoming more difitant 

The fitst change is a grwit step forwards ; lliu second i« on 

some accounts to be regretted, but not on all : for it i^ parity 

due to the fact that the increoee of tnie self-respect auioug 

the wealthier classes is making them no longer care for the 

mibscnnent personal attentionn they need to require. Again 

the growing value of timo makes poople \ces willing than 

they were to «pend several honrs in shopping; they now 

ll often prefer to spend n few minntea in Mrriting out a long 

LUfit of orders from a varied and detailml |)riee list ; and this 

^Hfiey are enabled to do easily by the growing faeilities fur 

^^Wdering and reeeiving paniek by po«l and in other ways. All 

I tbctie changes render it more dif^cult than it was for the 

small shopkeeper to hold his owq even in the provision 

trade, and othera in which no great variety of liitock is re- 

^anired. 

^V But in many trades the ever-growtng variety of com- 
i^inodities, and those rajwd changes of fashiou which now 
extend their bancftil influence through almost every rank 
of iociety, weight the balance cvcu more heavily against the 
Kmall dealer, for he cannot keep a sutlicient stock to offer 
much variety of choice, and if he tries to follow any move- 
ment of fushiou clo»c1y. a larger proportion of his stock will 
be left stmnded by the receding tide than in the cnse of a 
large shopkeeper. Again in some branches of the clothing 
and fiimiture and othrr trades the iucr\:aaiug cheapness of 
chine-made goods is leading people to buy ready-made 
iogs from a largi- store instead nf having them made to order 
by some snudl maker and dealer in their neighbourhood. Again, 
the large shopkeeper, not content with receiving tnivcUera 



BOOKt*. 
CB. D. 



owing t« 
ItrngnnrU) 
of <m1i 



Mill Ull* 

tlie uumla 
in i-nniuian 



348 



PBODCCnON ON k LARQB SCALE. 



nooR It. 
on. n. 



TliBifecay 
ottbe 
■Dull ahnp- 
ItoeiwrtiiB 
nutttrr of 

ilKirl- 
ance. 



ketrrj- 



from the manufactuivrs, mak*<« toure either himself or 
his ngeiit iu the mi»t. important mnmifactiiring districts 
home and abruad; and he thus dispenses almost eutirely 
with middlt^mca between him and the manuiactiircr. Oa 
the other hand in some brauehes of the textUo trades, the 
ense with which large packets of jMittents are distiibuted 
niauiifacturere and warehousemen, is telliDg perceptibly 
the side of ihw small shopkeepers '. 

The itmall shopkt.'epcr seem^i likely always to retain sotii 
hold of the repainog trades; and he keeps his owu (airiy 
well in the »ale of perishable foi»d' capcciaily to the working 
clasties, partly in consequence of his being able to sell goods 
on credit and to collect the small debts due for them. But 
on the whole he is losing gnmiid rapidly. The decay of the 
small m&uufacturer appearetl t.a the econoinists in the firet 
half of the century as one of the chief causes that were 
changing tho ehuracl<.-r of England's industrial and social 
life : the decay of the »mall shopkeeper seems t« be a more 
potent influence just at the present time. .fVnd it is note- 
wt>rthy that those small shopkeepers who are holding their 
own best, are also as a rule producers ou a smoJl scale, ati^^ 
vice versa. ^M 

§ G. We may next eousider those industries whose 
geographical piisition is determined by the nattiro of thcit. 
work. 

Country carriers and a few cabmen are almost the 
survivals of small industry in the carrj'iug trade; 
American ex])erieuce eanses some doubt as to how lot 
cabs will remain in general use. Railways and tr&mways 
are constantly Increasing iu size, and the capital required 
to work them is inrreaeing at an even greater rale. The 
growing intricacy and variety of coinmercB is adding to the 
odvantoge-K which a large fleet of ships under oDe mauage- 



1 A lailor with m-^Bltinie opitij ilioivs bii ciutaiiicn <|«eini«n« tl nMuf 
bunilrrdB ut thr uuwi-vl •.-toths. &iiJ iwrliaj-n unlcre hj l«](ip«|ili lh» »«hifteJ ela(k 
to bo Miit by inrccb' p^iM. .\tinuii. ladicn oflrai bnjr tlxir mattftob dinet 
from ibe uuuiuIOL-tuTer. uiil gel lb«Bi iuaiIh uji hj ilniuaiulim wlio fasm 
any cA)ifUtl. 

* But Ihe lugo liDElnets ol iLe Atrmt«<1 BN'Ut CoiBp«iij Bnil otiier* of a1 
IcLnd Lo Lm^OB iit yralralily th* far*ninii*r of luui; aiulkr iMmMMnte. 



ItAILWAYS AM> Stl.SEe. 



349 



ent derives from it* power of delivering goods pmmptly, mn>e iv. 

Olid witJiont breach of raipnusibility, in niauy tUffereur purt**; _| ' 

' as rugardH the vesxcls themselves time is on the side of 



am 



large ships, especinlly in the ]iassenger trade'. As a cori- 
seiiiieDCe the argmneuts in favour of the State wndertalting 
bii!iiiie«a are stronger in 6umo branches of the eatryiug trade 
than in atiy other except the allied undertakings of canying 
«9kVuy refuse, and hriiiging in water, ga*, &c.' 

The contest' between large and Hmall mines and rjuanies iSuim uid 
fuot so clearly marked a tendency. The history of tliL-*''''^"*" 
"Stlltc mwiagtimeut of mines is full of very dark shadows; for 
the butnni'Wi of niiuiug depends too much on the probity of 
its managers and tlicir em-rgy and judgment iu niattcra of 
'detail OS well as of general principle, to be well mnnaged 
by State officials : and for the eame reason the Kmall mine 
quarry may fairly be expected, other things being equal, 
'to hold its o»Ti against the large one. But in somo cases the 
CO«t of deep shafts, of machinery and of establishing means 
of coQirounication, are too great to be borne by any but a 
large business'. 
§ 7. In agriculture there ia not much division of labour, Apicnl- 



* k sUp't cnrrfinii iH'WL-r vftris* a* tiir cuhn nf lit>r iliTnaiiisloiifl, wtill» the 
ofloTpd l)T Uii- WBtfr lnar«««e« only b little tuiir tliaii tlio w[iuiv 

lit ItfT JinwQiiiona ; u) tlifti A tun* tliip mjninui Uui niAl in |in'|>"rticui Iv rla 
tfloca^P Uiui k miiall «i>t<. Il alau nvjuim Iiwb Ubmir, piprcioJly Uint of iinvi* 
jEati<>a: while to piti>wiiKani it aB<;r* ktmUt taJety aiiil i-oiiifurl, lutirr cluiico 
irf cuDiiNUi; uiil lK.'ll«r iiivf(iMii>iiBl uttMiilauue. In Bliurt Uiv huioII nhip liu on 
clwncp 111 (xaiipctiiig with Uin lut^o ■hiji li»t«iwii [lortjt. wbli?li Urse ihijit taii 
ily enter. Slid Imi^md nliicli lli« Innic i* BuOkiaul to wialilc Uicui to flU 
I (]tunU]r. 
> It ■■ <ku«cl«r!atie el the gttu ooanoBuo diuigo vf the lart luU twatoi; UmI 
btu (be &rit niliia; bills ir^rv jHtned, prorldon wm la^a for iUttwiutt )iriTah! 
liriduala to run their uwu cuure^Biicce ou tli«aa, joat tn thsj ilo mi • falghway 
or ft mill: tml now we flniHl lUncoIt iti iTn^uotamr paoiilaoaul'l li>v« eip«ct«d. 
M tliaj cen4iiil]r ili>l. that tills pliui mould v-ruve a praoUcablc oqh. 

■ WliUo tliu ouipnt ii( Mini ill tliii cnuritTX m tneraailiiK. Ibe number oS miiica 
1 4biiliil*Uii|[: hot Uiu Is jmitlf dno Ui l]>6 elodog of mmj of (ho ii«v mlnon 
Ueli wet« tuutilf ttftiMA tome yean ago than thv priui of ii^nol wui ivrj- tiitiU. 
oonhMte betWM& Uia larfio aud tujsU wvUtuib of ptvdncUun bw lod to 
[ 4fl)H>4c« In the .Uricau ilianioml mint* and Itic Aiui'ilrtui oil rvKtoas. 
Satni ttuuml and tbe Auicrlciui oil duct* art) K<ity| iiiilaia'iw uf tbo wajr 
In whitLb a provbuou may In.- iiiiiIh fin ihn juiiit luv ol a umulHir of luinaa, ■'liiob 
no CHMof tbem ewnlil aAunl v|iitrali>l;: biit th^jr n]«o show bon tbla coorM glTM 
vpMiing* fot the formation ol poweriol raouopoliea. 



350 



PRUDUCTIOH ON A lAROK SCALE. 



ItMlf. 



':M 



Itrc4)nin9 

• colt' 
■IfLnlly 






BooKrr. and (bere is no production on a very lar^ scale'. Tbis is partly 
" "•" • due Co natural causes : to the changes of the seasons axtd t« 
tnm ban tho tiifficiiltv of concentrating a jrrcat deal of labour in any 
iwculiwio ono place- Nevertheless agnciiltTire has recently mov. 
somewhat in the diroctioo of the methods of maDufucM 
and niay pt>rha].M gu much further ; ina«;hine work is puRhinj; 
out hand work in all directinns ; and in Great. Britain at 
least stt-ain power is pushing out horse power'. A well 
equipped farm liaa, as we have seen, a great numy expensiTe 
machines, for most of which a small farmer can tind eraploy* 
ment duntig only a very short timw. Ht* may hire «f>me of 
them from people who make it their business to undertake 
st<;am plou^liiug aud thrashing: but there are many of which 
he can get the uhcj only by co-operation with his ueighbouisi 
and the uncertainties of the weather prevent this plan fi 
working very sm*M>th!y in practice. 

Again, agriculluru rtijuires ever more and more kno 
ledge : to keep abrenat of the changes of the day, the farmer 
Icnu'^V. '""*'' S'^ bL->oiid the results of his own and his father's 

Riui tiiin experience. He must be able to enter into (he movements 

lucmAM ' 

thpeccno- of agricultural acieuce, or al leMt to follow thorn closely 

jpottij enough to see their chief practical applications to the caec 

w^sod °^ l^'" <*wa farm; and to do this properly requires a trained 

oifOiotU oi g^ijj versatile mind. A tarmer who has these qualities could 

raent. Bn<l time to direct the general course of the manageme^H 

of several hundred, or even of several thousand acres; th^^ 

maro superintendence of his men's work in matters o^^ 

detail is not a task fitting for him ; the work which V^^ 

ovight to do, is as difliewlt an that of a large mannfacturer, 

who would never drejun of Hpending his own strength o^^ 

minute supervision which he can easily hire subordinates jH 

do; a farmer who enn do thin properly, must be wasting his 

strength on work that is beneath him, nnlufis he employs 

many gangs of workmen each of them iind«r a responsible 

■ A MHwUvd "Ursc I>rin " i^mm not emplo; ■. tenlh part «( tka Uboui oliich 
la OoSocfaid In ■ (•cUir}' «( moilrrnhi iliinonsloDs. ^^H 

* UoTM power i» lU-arcfr rvlatinlr U> both nMuii powei and bud im^^l 
In Knjctind Uiao In tnoal otlinr rnimlrlni. KitKUnil liiui IhVvd Um I*«i1 iii Ihi* 
buproremiuit of Aeld ttmrn moclmivri nud Auicriru lii Uial of licno lUMlUuot} 
Biid Iium) ImjiraTpinBnU. 



AGIUOULTUBE. 



SSI 



But Ihorc ure not maajr fanes which give Roope 
for this, aud there is therefore veiy little inducement for 
rc-ally nblo men to ootor the busuicie of forming ; the beat 
enterprise and ability of the country generftUy avoid agri- 
culture and go to trmdett in which there ir ixiuni fur a man 
of first-rate ability to do nothing but high cla*s work, to do 
a great deal of it. and therofom to get high earningfi of 
managemenL TIus however it; a Kubjeet to which we tihall 
have to return when we come to counider the problem of 
agricultural ryiil iu relation to laud tenure. 

The experiment nf wiirking &miH on a very large Hcale u 
difficult aud expoueive, bucause to be tried properly it would 
require farm buildings and nieanK of communieation specially 
adapted to it; aud it wuuld have to overcome a good deal of 
resistance Irom custom and Mutiment not altogether of an 
unhealthy kind. The risk alao would be great; for in such 
cascfi thasc who plonetT often fail, thuugh ihuir route when 
well trodden may be found to be the easiest and beet '. 

If it be aHSumed. m is the niodeni fushiou, that the 
er is not to work habitually with his men and to 
encourage them by his prc.sL':iice, it aeems beet for the 
economy of production that farms nhoidd be as large as 
ia ptncticable uudt^r the existing condition of land tenure ; 
so as to ^ve room for the use of highly specialized ma- 
chines and for the uxcrci^A: of great ability ou the part 
of the farmer. But if a lami is not very laige, and if, an 
in often the ease, the fanrn^r has no greater ability and 
actinty of mind than is commonly to be found among the 
bett^-r class of working foremen in manufacttires, then it 
,would ha be«t for othcrs^aiid in the long run for himself, thai 
le shouhl return to the old plan of working among his men. 



BOOK tV. 

ca. u. 



, w ell 
^^6rm 



Ancitber 

pluii< 
tlitUot 

■mall 
fimiia ill 
tlin wnrk nf 
wliicJi tJlK 

f&rmor uid 
lib file 

take BOlno 

nil lire. 



I Ottf knovlcdeeaii DUU17 dwimUd jwiiiti woolil be narb uierttuic«) and t«Ii»)i1d 
iiMtte* gftinnl tm Ui* futnr* If •onta privnU jicrHiriis or ioint ■locli oomimnim, 
tCO-«>p*nti*o uwvialiaD*, wovlil nwka • f«tr csivfal i^spcriniiiiiU ot wlwt hkfo 
bem called "Tutiiry bnaa". Od (Lis ploD (Ltn nuuU Im ■ osnlnl wt at 
iNilllldig* lUictr might he nam tiuui oue) tttaa vhicJi roada And even Ught 
tntawsjra eiUmdal Iu til illKotLoiis. Iu tbeae bttUdlnea Uia reoQgnlMd prlncdjilea 
of ftoUirj nani^ittiirnt would Iks a]ipl)>dL uMliiueTT wDoU h« (peeia]ii(«<] uid 
[lomiicil. waiiio of (naii<riAl woTild hit nvntrlMl, bja pTorfneta mmld ba ntili«ad, 
I kbova aD the b«t ikiJJ Mid uikiiafjiiig i>owtr would b« taafiafuA, but onlj for 
ttspropar wtirii. 



S52 



PBootrcTioir ox a uboe scaue. 



wmt IT. Perhapa alBo his wife might return to some of those light 
°"' " " t^asks iu aiid iic-at thi: farnihouse which tradition aacribea 

her. Tbey retiHire discretion and judgment, thej aj^e not 
ineouafiteut with education and culture ; and combined wit 
it thej would raiec &ud not lower the tone of her life, at 
her real claims to a good social position. There is aoc 
reason for tbinkiujs; that the stem action of the priucipt^ 
of natural selection is now displadog those ianuers, who hnv^ 
not the faculty to do didlcult head-work, and yet de>cUne 
do hnnd-wark. Their places are being taken by men of more" 
than average noitiiral ability who are with the help ti^_ 
modem education rising from the ranks of labourers ; wtt^f 
lire qnito able to manage the ordinary routine work of a 
model fami ; and who are givitig to it a new life and spirit 
by cftlling their men to come and work, insteod of tolling 
them to go and work. Very large farms being left. o^^| 
of view, it is with rather small farms worked on thea^* 
principles that the Immediate future of English agriculture 
scorn;* to lie. 
Vmr»m»li Verj' small holdings however have great advaot 
wherever so nuich care has t^o be given to individual plai 
that macliinery is out of place. There is reason for hoping 
that they will continue tn hold their own in raising 
TCgetnblee, flowers and fruit. But tunny of the special 
advantages of very small holdings depend on the mode of 
tenure of the loud; and we must therefore defer the further 
discussion of this point, 



CHAPTER XIL 



LNDUSTBU.L ORGANIZATION, CONTINUED. 
MANAOCUENT. 



BUSINCSS 



§ I. BtTstNEss mny be taki>n t>o include all provigton for 
the wautfi of othprs wMch is made iu the cipoctatiou of pay- 
ment direct ur iwUrect from ihoeo who are to be benefitted. 
It Is thus oontrMtexI with the proviwon for our own wants 
which each of u« makes for himself, and with those kindly 
services which are prompteti by family aHectiou and tlio 
denre to promote the well-beiug of others. Business inanage- 
meot or undertalcing has always had many difTereut forms, 
and their number and variety wa« never so great as in 
England now. Relics remain of almost every form that has 
ever been iu use ; while new forms arc conatajitly being de- 
veloped. 

The primitive handicralWnan managed hin whole bunin^sK 
for himself; but since his ctutomera were with few exceptions 
his immediate neighbours, since he required very little capital, 
since the plan of production vias anangwl for him by custom, 
and since be had no labour to superintend outside of hia own 
houaehold, thctw iatAix did not involve any very great ment-al 
atrain. He was far from enjoying unbroken prosperity; war 
and scarcity were constantly pressing ou him and Im neigh- 
botUTB, hindering his work and stopping their demand for his 
Wftpeg. But he was inclined to take good and evil fortune, 
like sunshine and laiu, ah things bt^yond his control: hix 
lingers worked on, but his brain wau seldom weary. 

Even in modem England we ttiiil now and then a village 
arCiBan who adheres to primitive methods, and makes things 
H 23 



nwRiv. 
en. III. 

Buvi lilts 

111*1 1( llHS 

lUBiiy 

fiimiK. 



TJio pri- 

IJlitiVf 

tiAiHli- 

(■mnimftii 

ilcitlt 

dimctlr 

wIUiiImi 

(■oiiMiUlU': 



3.^4 



rANAOKKEST. 



nnoK IV, 
CB. m. 

aiiil «o do 

tlie- leani*^ 
(irnfAinionH 
iinw, 



But l}ier<i 
are excvp- 
linn* nvm 






litutiiMMva 
tlwaonlni 

(kuof 



on his own account for sale to his npighboiim ; 
owu busiiiei^ and uiidiiTtakiii^ all its ri-sk^^ But such CflMS 
are rare: the most striking instance-s nf aii atlhi-rencf to oW- 
^shloned methods of btiaiiiess are supplied by the learned pro- 
fiwsions; for a phyaiciari or a solicitor mani^es as a rule hia 
oviTi buBiness and does all its work. This plan is not. without 
it« disadvantages : much valuable activity is wtiatvd or turned 
to but slight account by aome professional men of first-rate 
ability, who havu not the apecial aptitudi; iv(iuin.-d for obtain- 
ing a bunness connection ; tli«y would he bott*r paid, vould 
lead happier lives, and would do more good service for the 
world if their work could be arranged for tbt-m by some sort 
of a middleman. But yet od the whole things arc probably 
best as they arc : there ore sound reaeons behind the popular 
instinct which dixtnLtts the intninion of tht> middleman in the 
supply of those sor^'ieea which roquiro tho highest and moot 
dulicate mental <|unJities, and which oan have their liill vt 
only whore there is complete personal confidence. 

English solicitore however )w;l, if not as employora or 
dortflkers, yet as agents for hiring that branch of the l^al 
proftsssiou wliieh ranks highest, and whose work involves Uic 
honlcst mental strain. Again niajiy of thti best instructors 
of youths sell their services, nob direc!tly to the consumer, 
but to the governing body of a cullt'ge or schiwl, or to a 
head master, who arranges fur their piirchasti; the emploi 
supplies to the teacher a market for his kbour; and in 
posed t*) give to the purchaser, who may not be a good jod 
bimMelf, some sort of guarantee as to the quality of 
teaching supplied. 

Again, artiste of every kind, bowaTer emiueiit, ofleii fii 
it to their advuuUbgo to employ some one else to arrange fafa 
them with cuBtonien ; while those of less established rcpd| 
ore somutimes dependeat for their living on cajutaUst tradera, 
who are not themselves artists, hut who understand how to 
sell artistic work to the bc^t advautagc. 

§ S, But we have already hcud how unsuitable l^| 
primitive pattern is for the great«r part of the buidn^P 
of the modem world. Tho task of directing product!^ 
90 that a given effort may bo most effective in suppl) 




OftAOUja BISE OF THE BUSINESS UNDEBTA,K£R, 



335 



its is 80 difficult under ihc complex conditions iw>oicir, 
life, that it has to be broken up and given Into '^ "' '" ' 
the hands of a spocialiwjd body of employers, or to use ""j'l*^ 
a Bioro general tt-nn, uf btiKincHa men; who "ndventitre" toneno. 
OP "midertake" its riskH; who bring together the capital and 
the labour required for the work ; who arrange or "engineer" 
lis general plan, and who superintend its minor detail*. 
Looking at biu>ine») int-n from one point of view we may 
regard them a» a highly skilled industrial grade, tVom another 
as middlemen inter\'ening between the manual worker and the 
oomuimer. 

Tbereare some kii)d>^ of business men who uudurtake gnvat Sumcctf 
roks, and exercise a large influence over the welfan; both of „,^ ,„,. 
the producers and of the conmuniers of the waxes in which J[{j?"" "' 
they deal, but who arc not t^) any considerable exti:riL direct 
employeifi of labour. The eitreme tj-pe of these is the dealer 
uu the stock exchange or the produce murket», whuse daily 
purchatms and raJcM an.- nf va^t dimenMionn, and whu yet hatt 
neither fitctoi)- nor warehouse, but at most aa oflBce with a 
few clerks in it^ The good and the evil effects of the action of 
Hpcculutun Htch an these ata however &o complex theniaalvea, 
and are so intimately interwoven with fluctuations of com- 
nierciaJ credit and the changes of the money market that 
they cannot be conveniently discussed in this place. It iBhntwowiil 
true that there is an element of speculation in almo&t every oa^^^eg 
kir»d of btisineas : but in this early stage of our intiuiry it ia *f,i^fl^{;i, 
best thai we should irivG our chief attention to thoeo forms of ii><»c n-lw 
business in whicrh administmtion counts fur most and the 
subiler forms of apL-culation for least. Let us then take some 
illustiatiuns of the mc)n> common typa<i of bufiiuess, and watch 
the relations in which the undertaking of risks stands to the 
of the work of the; business man. 

|S. The building tnule will serve our purpose well, partly liiii»ii»tld? 
it adheres in some rtupectH to primitive lueibiHU of boOiitig. 
bu«tn««a. Late in the Middle Ages it was quite common for a J^ ^J.. 
privntt' p«TSim to build a house for himself without lh« aid "jf ''""^..^ 
a mnater builder; and the habit is not even now altogether i>y pni«ic 
extinct. A penton wbo undurtakcx hjs own buUdiag must 
hire separately all his workmen, he must watch their work 

23—2 



iwnnna. 



3^6 



BUSINESS UANAOEUBXT. 



DI10K IV. 
CII. Ill, 



Tbe chlcl 
riafcaof 
nnder- 
tntiitj; 

WllliellKICd 

it<-|iarBt('1 
truui Uiu 
i»orl(of 

nuuikge- 
niont mill 
■niwr* 

iij I)i« 

IraiUinit 

tndtt; 



iuUiL' 
t«tUe 

tndmi: 



aud chock thi-ir di-mamls for payiiu-iit; he muxt 
materials irom man v quarter?, and he must di8pens« vith (bL 
use of expensive machinery uiilcsn he hapfietiK to be ablli^| 
hiie it. In the result he probably pave more than the curreot 
wages ; but ax others gaiu what lie luseis, there is no restiltoalf 
waiite so lax. There is however great waste in the time he 
Spends in borgainiug with the mcu and testing and direct- 
ing their work by his imperfect knowledge ; and again in 
the time that he spends in finding out what kinds and 
quantities he wants of different materials, and whera^^ 
get them bept, aikd bo on. This wn»Ui is avoided by twT 
division of labour which aitfdguK to the professional biiilder 
the task of superintending details, and to the profcseioniil 
architect tho taek of drawing plaiiH. 

The division of labour is often carried still further w| 
houses are built not at the expense of those who are to lire 
in them, but es a building Epeculatinn. When this is done 
on a large scale, as for instance in opening out a new suburb, 
the stakes at issue are so large aa to ol¥er an attractive field 
to powerful capitalist* with a very high order of genenl 
busincKs ability, but perhaps with not much technical know- 
ledge of the building trade. They rely on their own judgment 
for the deosiou an to what are likely to be the coming rela- 
tions of demand and supply for different kinds of houses ; bill 
they intrust tu others the aianageine:it of dctaiLs. They 
employ architectK and surveyont to make plans in aocordanoe 
with their general directions i and theu cuter into contracts 
with professional builders fur carrnng them out. But they 
themselves undertake the chief risks of the busiuees. aud 
control its general direction. ^m 

§ 4. We have already seen' how this division of tV 
spousibility prevailed in the woollen trade just before the 
b^finning of the era of large factories: the more speculative 
work aud the brooder rbks of buying and selling being tAken 
over by the undertakers, who were not themselves omplojei* 
of labour; while the detailed work of superintendence bad 
the narrower risks of carrying out definite contracts were 
handed over to Bumll masters. This plan is still exten- 
> Book L Oil. ID. 14. 



THB DKDERTAKER WHO IS NOT AV EUPLOYEB. 



357 



sively followed in some branches of the textile trades, 
e9i»«ciiiJly those m which the difficulty of forecantiug the future 
ia very great Manchester warehouHemen give themoftlvea 
U) Bludyiiig the niovementa of fashion, the markets for mw 
niat.erial.s, the general Htste «f trade, of thL- money murkut, 
and of politics, and all other causes that are likely to influence 
iha prioen of different kiniU of gntHj!) during the coming 

,Benaon; and ul'ter eiuployijig. if neceasary. skilled desiguera 

cany out their ideas (just as the building spuculaLor in 

li! previous case employed architects), give out to manufac- 

^tiirers in different parttt of the world cmitracbi for making the 
goods on which they have determined to risk their capital. 
Again, the foreign meTchant very often hos no ships of his 

'Vwn. but gives his mind to stridj-ing the course of trade, and 
undertakes himself its chief ri^lw; while he gets his carrying 
done for him by mea who require more administrative ability, 
but need not have the name powtr of foreeaiitiiig the subtler 
movementii of trade; though it is tnie that as purchaser of 
lips thoy havo great and difficult trade risks of their own. 

'Again, the broader risks of publishing a book are borne by 
the publijther, perhupB in company with the uulhor. while iho 
printer is the employer of labour and supplie-S the expenRive 
ty[K's and machinery retpiirud for the business. Aud a. sumi*- 
whal tiimilar plan in adopted in many branches of the metal 
trades, arid of those which supply furniture, clothing, &c. 

In the clothing trades especially we aec a revival of what 
lias been called the "house industiy," which prevailed long ago 
in the textile induHtrii\s ; that is the system in which large 
undertakers give out work to be done in cottages and very 
Biiiall wurksbopH to persons who work alone or with the aid 
of some members of their &mily, or who perhaps employ two 
or tbrcG hired ateiataats'. In remote villages lu almost 

< Tlia 0«mui tcoooadil* taS tbla "ttebtirj Ilka" ifabrUmiiiiulii) liouu In- 
^mtrj, M 4iBtiiigiii4u4 from tbe " N«UoiuU " Imiuc indiutr;, wliicli twca the 
{MhvbIb of ottior irork (niwdkllj Uw winlw laUniwliaiia td icilralMrci tor 
MilMiiliu7 work in nukiitc IcKtUe uul othor gnwU. (Bee ScMnberx on Otattbe 
ta bia ll^nttbufh .) ItomMlic varlun of Uii> lut cluo wer* couunon aD mtr 
SanqW !■> *^ Uidill« Ajiw faul U9 now bMomiug ruv nxwpl iii Uitt mnimuuRs 
in EAAteni Kuropv They ore not dtrayii wtil kdTJiicd iu Lhrir cLuim oS 
(k. Udell of >li»l lli«7 aitko could W luul* IwU^t villi far l«tw Utxxu' hi 
cun1e^ and eULDOt Ih^ told iiroAtablr In llio opeu puvkel: hul far the mom 



BOOI IT. 

cu. XII. 



iutUe 
tnul«; 



ill tLe |)ru- 

(luetiaii ol 



111 buciw 
iudiuini:*. 



358 



BII8D1S8S HAXAnGMGNT. 



WOK IT. 
OB. EU. 



■ndin 



Uibplaii 



bnt Is Uil>le 
tu abuu. 



uvur>- county of England ageute of large undertakers 
round to ^ve out t<o the cottagers partially prepared lua 
rials f<:>r goods or all »ort3. but cspi;cially clothes sucli u 
shirte and collars and ^lovus ; and take back with them the 
linitihcd goods. It is however lu the great capital cilice of 
the world, and in other large towns, eapedally old towns, 
where there is a great deal of unskilled and iinor^aniz«d 
lalwur, with a eomewhat low physitjue and morale, that the 
Bjmcm is most fully dcvelopod, cspeoially in tbo clothing 
tradoB, which employ two hundivd thousand people iu Luu- 
doQ alone, and in the cheap furniture trades. There i^ a 
coutinuul contest between the factory and the domestic 
Bystem. now one gaining ground and now the other: fur 
instaneu just at preneut tht? growing usb of sewing inachints 
worlteri by steam power is strengthening the position of the 
lactones in tbct boot trade ; while factories and workshops 
art! getting an increatfed hnUl of tht^ tailuring traile. On tha 
other hand the hosiery trade is being tempted back to ths 
dwelling hou»e by recent iniprovemuntM in hand knitting 
machines; ajid it is passible that new methoda of distri- 
buting powpT by gas and petroleum and electric eogi naa 
may exercise a like influence on many other industries. ^M 

Or there may be a movement towardB interrnt.'diatc plat^T 
similar to tboHe which are largnly fuUownd in the SheffieL 
trades. Many cutlery firms for instance put out grin 
and other parts of their work, at piere work prices, 
working men who rent the &team power which they nHjuire, 
either from the 6rm Irom whom they take their contmct 
or from aome one else : these workmen sometiioeti employing 
others to help them, sometimes working alone. 

ThuB there are many ways in which those who undertake 
the chief risks of buying and selling may avoid the trouble 
oi' housing and superintending those who work for them, 
They all have their advantages; and when the worken are 
men of strong character, ns at Sheffield, the results are on 
the whule not unwttisfaetory. But uiifortunntely it is often 
the weakest clasK of workers, those with the least re«ourw 

]«rt t1ipy taaku for thoir own w tlidr nrigbboon' os*^ tiud tlnu Mr* the proAu 
of manj vmea of uicldlctDoii. 



ffield 




TDB rHDEATAKEB WilO IS kS EMPLOYER. 



359 



ai.su. 



I tliu leafit eelf-control who drift Into work of this 

kind. The elasticity of the systL-m which rccnmmencU it 

to the undertaker, in really the tncaiis of eaabliiig him to 

exercise, if he ckooscif, an uudeairable presBurt! »u thosu who 

I tlu his work. 

^^b For while the i*ucce»«i of a hatory depends in a grc-at 
^^meosure on ite having & set of opc-mtives who adhtre sttsadily 
^^ to it, the capitalist who gives out work to be done at home 
^■bw an iiit«K«t in retaining a great many persons on hia 
" buukit; he is leiiiptod to give eac-h of them a. little employ- 
ment occaj^iontUly and piny ihem off one agaiuBt anotber ; 
and this be can easily do because they do not know one 
^Kanother and cnnnot arrange cnnoorled action. 

^^L § 5. Wheu ditj prufitH uf bu»uueiid arts uudur disci»«iun several 
^^■Mf arc generally connected in people's minde with the foijcuriuB 
* employer of labour: "the i-mployar" is often taken a& a^^^ 
term practically coextensive with the receiver of btisinesa pn".li""l 
profits. But the luetances which vre hax'e juKt coiuiiuertMl raAnii- 
aie sufficient to illiuitrate the truth that the superintendence 
of labour is but one side, and often not the most iin[Kjrtaiit 
nide of bumnewf work; and that the employer who undertaken 
the whole risks of his busiiiuHa really {lerfonnH two entirely 
distinct sen-jw* on behalf of the community, and requires 

ta twofold ability. 
I The ideal miuin^-turer for inntance, if he make» givdn Uif fwnil. 
: 



(■i-tnuwc: 



not to meet special orders but for the gt-neml market, iiiusl. „"^'i„ 



in hi* finst r61e a* nierchaiit and urgauiztr of production, have *"""■ 

thorough knowledge of thint/s in his own trade. He must 
have the power of lorts-'UBtiug the bruzid movements of pro- 
duction and consumptiou. of seeing where there is an oppor- 
tunity for supplying a new ctimuiodity that will meet u real 
want or improving the plan of producing an old commodity. 
He muBt be able to judge cautiously and imdcrtake risks 
boldly; and he mu<>t of course understand the matorials and 
machinery used in hi» trade. 

But sccoTkdly in bis riile of employer he must be a natural 
leader of jneri. He must have a power of first chousing his 
aBtdstants rightly and then trusting them fhlly^ of interesting 
in the business and of getting them to trust him, so as 



36ft 



BUSIMSSH JUKAOEUEXT. 



BOOK IV, 
OH. Xlt. 



^rcafi^ 



The iravply 
til Imriima 
ftbUlty HitiT 

irilhtlM 

fonnxot 
ln»lii«M 

UIDIIt. 



Tbv sua of 
a btuiiJiia 
iiuui xtRTta 
wiUi to 



to bring out whatever enterprise and power of origmati 
there is in them; while he hiiiiHvlf uxercixex agenc^ml oHitrul 
over ever>'thiD^, aiid preserres orxler and unity iu the main 
plan of the hiisinc»s. 

The abilities required to make an ideal employer 
so gmki ant] »o nnmrroiiK thitt rery fuw pcreimei ean exbiint 
them all in a very high degree. Their relative imporUnce 
however variea with the natiiri' of the indiintry and the 
of the busineea; aud while one employer excels in one seb 
qualities, another oscola in another; aeiuieely any two 
their success to exactly the same comhinfttion of advantaj 
Some men make their way by the uae of none bttt nobU 
qualities, while othc-rs owe their prosperity to qualities in 
which there is very little that is TuaXly admirable e 
sagacity and strength of purpose. 

Such then being the gunt-ral nature of the woric of 
bu.iine.KS majiagemmit, we have iiejt to inquire what op- 
portuniti&s different classes of people have of developing 
buwnesd ability; and. when they have obtained that, what 
opportunities they have of getting onmniand over the capital 
reijuirud to give it scupu. This imjuiry may conveniently be 
combined with some examinatinn of the different "forms of 
business mauagemeut " '. Hitherto we have coniddered 
alniast exclusively that form in which the whole responsi- 
bility and control rests in the hands of a suigle individual 
But this form is yielding grnund t.n ntheni in which the 
supreme authority is distributed among several partn«» 
or even a great number of &han:hotd«n<. Private firms and 
Joint stock, conijmnies, co>operative societies and public 
corporations are taking a constantly increasing short.' in 
the management of bu8ine«>; and one chief reason of Hub 
is that they oflFcr an attractive field to people who have good 
busiiieiM abilities, but have not inherited any great btisi 
opportunities. 

§ 6. The sou of a man already establishod in bus; 
has certainly very great advantagiM over othem. He hii* 
fri>m his youth up special Caeilitieni for obtaining the know- 
ledge and developing the faculties that arv re()iurecl in the 
> lliiB U what Oucmu ecuuomieta e«ll ' ' Vatmutamoft-lanum.'' 



;ina3^ 



HEREDITARY BUSINESSES. 



3C1 



management of his fftther's biiMiicss: he lerims tiuietly and dooh rr. 
almost unconj»ci<jiii(ly about men and ma.nnrr!! in hli fathitr'H *■' *'• "" • 
trade and in t-hoee from which that trade buys and to which 
it sells; he get* bo know the relative importance and the 
real significance of the variuus problems and auxieties which 
occupy hi« father's mind : and he acqnires a technical know- 
ledge of the proc«a8t* and the machinery of the trade*. 
Some of what he learns will be applicable only to bi« 
father's trade ; but the greater part will be serviceable 
in any trade that h in miy way allied with that; while 
those general facidtiee of judgment and resource, of enter- 
prise and caution, of firmnc*s and oourte«>', which are trained 
by aesociation with those who control the larger issue? of 
any one trade, will go a long way towards fitting him for 
managing almost any other trade. Further the -lonii of 
Buooewful biixinem men Btart with more material capital 
than almost any one else except those who by nurture and 
education ore likely to be disinclined for businetw and un- 
fittwl for it: aud if they continue their father's work, they 
hav^ also the vantage gmund of f*itabli«hfd trade connectiona. 

It wmtld therefore at first Nicht seem likelv that buBiness tliMoiw 

111 ■ ,. 1' -^ "''bI"' 

men should constitute a sort of caste; dividing out among Pi|wct 

their sons the chief potits of command, ajicl founding b;^C 

herwiitary dynasties, which <4hnuld nde certain branches "fll!^ uw'j 

trade for manv Keuerations tocether. But the actual state PMt«'; bit 

of things iH very different. ih<. .-wn- 

As a matter of fact when a man has got together a Vur 

great biinness, his descendants, in spite of all their great .hiiitywid 

adv-autago«, often foil to develop the high «bilttie.s and the J'^"^ 

special turn of mind nnd t«-'m|K_TUment reipiired for carr\nug '"'}*^*(*' 

it ou with equal suw^L'ss. He himself wafl probably brought 

np by parents of strong <rame«t chartictcr ; and was educated 

b}' their personal influence and by straggle with diflicultica 

in early life. But hii^ children, at all events if they were 

bom after he became rich, and in any case his gmud-chitdren, 

> W« liave kbiiadj Dotiml buw kbiitnt llie oiilj jh^wI niipr*iil)c«iki pM at 
BMktn titiw* kw thow f4 the *anii of nunnfitclmian. vim |<ri(rllw •liuuiit aviny 
faayorlMBA «p«<atioa llutt n carried oil iii Ibe work* *iitHpl«titl7 to he ab\» in tit*r 
jmi (0 euUr iota the diAcuItln of all iheii viuplv; i» nuil fonu u fair jadfumt 
on Ihtb work. 



U2 



BUSINESS MaJlAOEMIiKT. 



» 



miaxiT. 

CM. XII. 



uidvnu 
UMbMt 
LmUtiinii 
niU iMit 

nna ffivnt 

^bLIUIItNI■ 
very long, 
nul 
bio 
hro 
mn' 



Doee 

1 



aiil«ii* new 
blvoil la 
hrongbt in 
bj' Npme 
uetltod. 



mtbadol 
piiTila 

■tiili. 



OTo perhaps left a good deal to the can of domo«iic 

who are not of the rarae strong fibre as the parents by vrhoee 
influetice hv wiut educated. And while his highlit ambilj^ 
was probably Buccess in busiimss, they are likely to he 
least eqtiuUy anscioitH for H{x:ial or acmiemic diKtinction '. 

For a timu iud(*»d aJl may go well. Hie sons find fi 
firmly establishod trade connection and, what is perhap 
even more Importaut, a well cho»eu tttoJf of gubordiuatttt 
with H. generous interest in the biisiiKisK. By mere assidunH 
and cautiuQ,uvaiUug th«Qtselve» of the traditions of the lir^^ 
they may hold togt^ther for a long time. But when a full 
generatiuu has piiKKuI, when ihv uld traditions are uu lunger 
a saff guide, and when the bonds that held together ih« 
old statF have been dissolved, then the busineKS ahuo^^ 
invariably falls to pieces unle.'^ it [» practically handed oi^| 
to the management of new men who have meanwhile risen 
to pttrtnen*hip in the firm. 

But in most caswt his descendants arrive at this result 
a shorter route. They prefer an abundant income coming to 
thum without etfort. on their part, to one which though twice 
afi Wgu crnild he cuniiHl only by iiioes^oul toil and anxiety: 
and they sell the businees to private persons or a joint stoc^ 
company; or they become sleepbig partners iu it; that is 
sharing in its risks and iu itn pn>tits, but not taking part in 
its management: iu cither casu the active control over tht^f 
capital falls chieBy into the hands of new men. 

§ 7. The oldc^ and simplest plan for renovating the 
energies of a business is that of taldng into partnership some 
of its ablest employiJs. The outocratic owner and manager 
of a large manufaeturing or trading cunoem finds that, as 
years go on, he has to delegate more and more rMponsibility 
to his chief subordinates; portly bocauso the work to 




> L'ntil lalHljr tbtre has evar b«en t& En; kad ■ hind of uUgMiimi 
ai?aj]iMnic (liirli(« umI barineu. TUs i» now being dimitiialMd hj Ih* 1 
of till- Bjiirit uf uur iin-nt ttii[viir*itUi>, aiii] by tliv KTowth of f nllmpa in our cb 
bafiincsi]) cciitrcs. Tlic tout vt bnibinH men nbcii bmiI lo tbe Uuir^nllifa Ao 
■lilt leuu tu <io»|iiMi Uioli latlicrra' trwlm •« utU'U m ihvf vatA to io mku * 
KuiicnitiDii n^u. Muijr vt liusia IiuImhI ue iln'ri] kwrn; Ims) bniiDaw bj Uw 
itealre to uxUtiul tlif boaiitlaHni nl knonrlaclga. Bat Uia Ui^ar foma of taniul 
•tLiTir;, thcw* wliiuh are tuiusCnicUvc umI not mcnljr oitleal, Und b>pntMUa 
jut a|>)ir«cUll»ii i>f UiD ndiUllj' uf InunaMa work riglitlji' •■■>■■•■ 



PRfVATe PARTNGBitHlPa. 



86& 



doiic ui glowing beaviur, and partly' bucautiu bis owu »Ufi)gtli bookiti 
i» bt'comiug less than it was. He still exercises a supreme ° °' "* " 
OontTol, but Dinch niunt di.-[H.'nd an their uuergy lutd probity: 
so. if bie sons are not old enough, or for any other reason are 
not ready w t^aJtu pajt of tiic burd«ii off hia shoulders ho 
decides to stimulate the zeal of one or more of hin bnisted 
U8t«taiil(^ by taking thmii mto partuershliJ : hu thux lightens 
. his own talxxiiv, at the tsime time that he secrure» that the 
ik of his tUe will be carried on by those whottu bablta be 
moulded, and for whom he has perhaps acquired some- 
like a fetherij' affection. Much of the happiest romance 
of life, much that is most pleasant to dwell upon in the social 
history of England from the Middle Ages up to our own day 
.IB oonncctc<l with the story of private parl.nersihips uf this 
jass*. 

But there are now, and there always have betan private 
tjwwh'p" on more equal t^rms, two or more people of 
equal wealth aiid ability combining their resources 
for a large and difficult undertaking. In nuch cases there la 
ofttiu a distinct puxttlion of the woric of mauagenieut : iu 
iQaunfactures for instance one partner will sometimej^ give 
himself almost exclusively to the work of buying raw malarial 
and Ktilling the linishe<l product, while the other is reapoii- 
sible for the manag«;ntent of iIk- facLury: and in a trading 
establishment one partner will control the whokMale and 
the other the retail deporttiieut. In tliese and other ways 
^private partnennhip h capable of adapting itself to a great 
irioty of problems : it ia very strong and very elaalic ; it has 
played a great part in the pai^t, and it is full nf vitality now, 

§ 8. But the C'xpan.sion of old trades and the growth of TIih! 
new Ctades have long tended to outgrow the capitals that can i,ui>iio jnim 
cosily bo obtained by private companies; and from the end J.»^**™" 
of the Middle Ages to the present time there has been a 
movement of constantly incrt'asiiig force towards the sub- 



* Uanj k joutta hu bemi ■limiUnUiI In a bnr* careai bj Uie tiilluaicv of 
. Uid UIm vlileta tikmte tlio lUfCiMilliM uul Um nlltmato trliimiih ol tli» 
ItUnJ kppNfilioo, wLo htt* *t Inn^ oiinind ht* emplojCT'* ilknghter ftnd b««n 
Uk«n Ritu )iwtn«-ilu|> l>; biin. TUcrc uc uo tuBucucva «i' uklioiiaJ cluirectvi 
nor* fu-PMcUaic Ihku Muhm wliidi tlius gjv* shkpe to lli* aiiu of Hpiriutt 



34)4 



BCSUfESS auXAGEHEKT. 



vaoK IV. 
rii. iti. 



hllUItTB 

nndco-Mki: 
tliir rtitliii: 



Din-cion 

coninil 

ffn: 



who foptr- 
UitMiil tlie 




(t06 



slitution of public joint stxwk companies, the shares of w 
Cfui be Hold to anybody in the o|k>d tnnrket, for privi 
companieB, the shares io which are not transferable wit 
the leave of all concynifd ; and various plan-s vrith v,-hic?i 
we need not occupy ourselves just how. have been adopiaJ 
in diflerent cotmtries for enabling the aharehoWere to limit 
their riiiks to their shares. The etfpct of this change has 
Iweu to induce people, many of whom have do s 
knowledge of trade, to give their capital into the hands 
others employed by them : and there has thus arisen a. u 
difitrihutioii of the varinue part» of the work of buaiu< 
majiagement. 

The ultimate undertakers of the risks incurred by a joint 
stock company are the shareholder?; but as a rule they 
not take much active part in engiut-orin^ the busiaese 
controUiug its general policy: and they take no port 
Kiiperintoniding its details. After the business has once goi 
out of the hatuLt of its original promoters, the control of 
it is loft chiefly in the hands of Directors; who, if the 
cempaDy is a very large one. probably own but a very small 
proportion of its whares, while ihti greater part of them hare 
not much technical knowledge of the work to be done. 
They are tmt generally ex[>ected to give their whole time 
to it; but they are supposed to bring wide genera! knowledge 
and Hound judgment to bear on the broader problems of 
its p>licy; and at the samp time tn make sure that the 
" Manugors" of the company are doing their work thoroughly'. 
To the Managers and their assistantK is left a great part of 
the work of engineering the business, and the whole of t]||^| 
wurk of siijierintendiiig it: but they are not required to brin^^ 
any capital into it; and they are supposed to be promoted 

1 Bftgnhot deli^t«<l to Msnc (wo liir inntaiK^c Kngluh Cc^iliHon, Ck. ra) 
itini a Caliiiic<t Miiiictw ntU-u (k'ri-ri» Buoir aili-witaue frmii liia wuit of tcrbnk^ 
kii-avltflgp of tile bnni&orw at hiit DrpvttLirrit. He citii eut tliat tram Um T*r- 
uiluiaiil Swretnry uuil otbw ollliriiUi nho nrc nn<lrr bin auCliurit]: : b« i» luM 
llliRly to Ml Ilia indRtni^t a^ntinal tliitlia tin iiintun b-Iwto Utwir kiitiwlwtc* gtw* 
Ui<>n tbe ftilvttil&eo; but hla iuiprcjn(li<<Mt cotnmcni unac i* hktij to bTMnI* 
Uif trA^tiniiD <A nffifioUnin nlinri' tii-j cuiillirl iritit tlir jiiiMlr ii>l«<(«t: «»d in 
Uk( uiaiiiKT tilt? iiiU-rcntdvIa Compuij lunr ponMblr aoiuclLiiiea be looat aJviuiTfil 
bj tUoM DirMtot* hIio Lara tlie ItAtit loduiioU knoii-lc^e of (li« detaib of ila 



JOIKT STOCK COMPAXIE8, 



365 



'fi^m the lower ranks to the higher a^cortling to their ztia\ 
ami ability. Sitict- the joint tituck cunipanies in thu Unite<I 
Kingdom have an aggregate income of £100,000,000, and ilo 
a tenth of the business of all kinds that is done iu the 
country, they offer very large opportunities to men with 
natural talents for husincss manftgcment, who have not 
inherited any material capital, i>r any bu^^iiieiM cennection. 

§ 0. Joint fitopl: companies hnve great elasticity and can 
expand themseivos without liuiil when the work to which they 
have set themselvos offers n wide scope; &nd they are gaining 
ground ill nearly all dirL-clious. But thyy havn one griiat 
source of weakness in thu ahMence of any atlecpinte knowledge 
of the buijiuetis ou the port of the shareholders who under- 
take itj* chief risks, It i« true that the hea<l of a large 
pri^'atv firm undertakes the chief risks of the husmc^sK, while 
he intrunts many of ittf details U> others; but his position is 
secuTL'd hy his power of fonniug a direct jitdginent an to 
whether his subcirdinatett svrve his interests faithfully and 
discreetly. If tho^ to whom he has intnisted the buying <»- 
selling of goods for him take eommis-sions from those with 
whom they deal, he ie in a put^itJou to discover and punish 
the (mud. If they show favouritism and promote incompiv 
tent relations or fnends of thirir own, or if they themselves 
become idle and shirk their work, or even if they do not 
fulfil the promise of exceptional ability wluch induced him 

^vc bhem their first lift^ he can discover what in going 

>ng and net it right. 

But iu all these matters the great body of the sh4re* 
holders of a joint stock company arc, save id a few excep- 
tional iastanoes, almost powerless; though & few of the larger 
Bholdere often exert themselvtts to lind out what is going 
and are thus able to exercise an effective and \nac 
'control over the general management of the btuiiness. It 
i a strong proof of the man'ellous growth iu recent times of 

spirit of honesty and uprightness in commercial matters, 
that the leaiiijig ofticers of great public companies yiold as 
ittle m they do to the vast temptations to fraud which He 
I their way. If they Hhuwed au eagerness tu avail thenuieh'es 

opportunities for wrong-doing at all approaching that of 



BlM)K IV. 
l-M. Sll. 



TImM vlio 
■iiii'lerUke 
Ihe cldet 
rub» tro 
nnt. M in ft 
■iiivalfi 
Ariu. tliMV 
■DOnI nlilp 
Ui juilm 
wlliPtllfT 
tlin liQiU. 
IIWW [* 

well 
■nftlikKfcl- 



If niidrrpil 



AGG 



BDSINESS MANAOEMENT. 



nooK n. 

CH. XU. 
iinl}' bf tlio 

inMUni 

VTOwLlt ilt 

tuornliC^-, 



mBit nil* 




C()-up«ra- 

tivd M- 

snrintitiii ill 
ItBbeHt 

flrniL 



nvDuU 
inasr oi 

fera 

ut joint 

slock Willi 

puiioH, 



which we read in tlic commercial historv of earlier ci 
Kation, their vtvimg uses of the triiBts imposed in th 
would have been od so great a scale as \« prevent 
development of thiw cU^mocratir fumi of biisiiiefn. There 
is L-very reasou to hope that the progreae of trade morality 
will cuiitinui:, aided tii the futurv as it hoft Kt-ii in the past, 
by a diminutiou of trade secrecy and by increased publicity 
in every form; and thus collective- and dum identic furnus of 
buaneas management m&y bo abk- to extend thetnselv«9 
safely in many directions in which they have hitherto failed, 
and may far exceed the great flervices they already render in 
opcniiig A largo career to those wh& have no odvoa 
birth. 

The sam*j inay he said of the undertalcingB of gn< 
menta imperial and local : they also may havy a grc-at fuf 
before them, but up to the prewnt time the lax-pnj'er w 
undertftkes the ultimate rifles has not generally succewl' 
in eieroising an ufiBcIeiit coutrol over the businesHest, and 
sGcuring officei-s who will do their work with as much ene 
and enterprise a* is shown in private establishments, 
problem of government undLTtakings involves however man 
injfHJrtanl wde is8ue.ii, which will rei^uire our careful att«utiou 
later on. 

§ 10. The evils nf these two methods of business 
meiit are howeiver in a grciat measure avoided by the s^ittei 
of co-operation, at all events when it appears in ita best foi 
For there u part or the whole of those shareholders w 
undertake the risks of the buainess are themselves employed 
by it ; and all the employes, whether they contribute toward* 
the material capital of the husinei^ or not, have a share 
it.B pi-ofils, and sorae power of voting at the general titeetin, 
ut which the broad lines of ite policy are laid down, aiid 
officers appointed who are to carry that policy into cffi 
Thus the groat body of the workers are the employers 
masters of their own managers and foromon^ they have 
fairly good moans of judging whether the higher work 
engineering the butdnewa ui conducted honestly and efficient]; 
and they have the best possible opportunities for dotocti 
any laxity or incompetence in ita detailed admini 









3-OPERATIVE SOCIETIES. 



367 



* 



IK 



nrt lastly they nimlcr inmcctissiry some of the nuMor work 
of superinteudence that is re^oired in other tistablwhmuiits; 
thuir t>wu pecuuiar)' iutcnrstjt aud the pridi; they take in the 
fflircem uf their own bttsineas mnJiHK c^och of them averse to 
any shirking of work cilhLT by himiself ur by hin fellow 
workmen. 

But the system has difficulties of its otra which have 

itbcrto kept it from succei:ding ud a largo scale t;xixi]>t in 
the businesa of retailiug commodities consumed by working 
mcD. Mimy of these difiicultlcs do not .belong properly to 
it, bat arc due to the fact that the system itficlf is not 
thoroughly carried out ; for the greater part of those 
establishmenta which call themselves co-operative have not 
adopted co-opemtive priiiciplus in their entirety. But other 
diOictilties belong strictly to it. For instance in buying and 
wiling on n large scale the officRrs of n co-opomtivo society 
are &llible and n«tdd aatiititaiice and couLrul ; atitl yet the 
ordinal)' membeni havu little tneauti of knowing what it 
would be best to do, and of detectiug what is really being 
done. In some caww they have been sBrvi^d excellently by 
mun uf greal genius both mentally and momJly; men who 
for the sake of the (.^i- operative J'aith that is in them, have 
worked with great ability and energy, and with perfect up- 
rigblncMs. being all the time content with lower pay than they 
could have got as business managers ou tht^ir own aceuunt 
or for a private; firm. But though men of this stamp may be 
more common among th<> (officers of co-operative tiocieties than 
other occupations, they an: not very common even there. 
Again, human nature being what it 'a, the employ^ 
theinaelves ore not always the best powible niastcrrs of their 
own foremen and managers; jcalouMes and frctlings at re- 
proof are apt to act like sand, that has got mixed with the 
oil iu the beoriugft of a great and complex raEichincry. And 
in particular, «nce the hardest work of business mauageraeut 
ifl goneraUy that which makes the least outward show, those 

'ho work with their hands are apt to underrate the Lutenaity 
tho etrain involved in the highc«t work of engineering the 
buuu«£8, and to grudge ita being paid fur at an)-thiug like as 
high a rute as it could cam el»ewhcre. 



HOOK I*. 

OB. 111. 



But it bu 
of iU Qtni ; 



■till 
nYanbi 
nben ii i* 
nut for- 
luiiaL«lu 

Itic urrice 
lit nirvl). 

UdiiaI njcn. 



368 



BUSINESS UANAOEaiENT. 



tlOOK IT. 

TLnie i* cru 

lt«aL<t«: 



Anil it maj' 
oftat 

N|llt-IIll>ll 

oiiportuiti- 
tlM to 

tueli irLu 
liavf great 
biuitieai 



Tlie ri«« at 

the work- 
ing nmn is 
■Kit liin- 

niucli tLv at 
fint iiiulil 
HpjH'U'ii, by 
lii^ wniit 
of MjiltaJ ; 



Some of these difficulties will b« diminished by cxpene 
by the difiuaion of a better knowledge of the true priuci^ 
of co-operation, and by that increase of geneml education 
which is every day fitting a largur number of the pwiplt- fiM 
entering into the complex problems of busineKs manageniew^ 
Others of tbe diffieultios again mil be partially or wholly 
removed by the increase in th« number of co-operative 
eocietitw, and by thoir grow-ing tuLdeucy tu act in alliance, 
if not in fedemtion, with unij another: tor by this uit:>aus 
they will avoid a considerable part of those speeuhitive risks 
which are the chief <jf all the hiDdrance* to the good manage- 
ment of many Itiiuls of bunaness on the co-operative plan. 

Wv shall tiave tu recur fr^tjuently to the pfoblemm suf^f 
gesbed bj both bnukcheti of the cu^uperative movement. lh^> 
vfaieh lu& already achieved succe^ iu retail trade, and that 
which is entering uu the more difficult and perilous paths 
ofagi'iculture and manufacture. 

But we must not pui-sue this mquiiy further now : enough 
has been said to show that tlie world is only just beginning to 
be reaiJy ffir the higher work of the co-uperative moveiueut; 
which may therefore be reasonably expected to attain a much 
larger success iu the future tbau iu the piwt. And if eo it 
will offer the beat of all possible opportunities for working 
men to praetise themBclves in the work of busiacds manage- 
ment, to grow into the trust and confidence of otbera, and 
gradually rise to posts in which any business abilities 
may have, however great, will Htid miftivieut scope for 
full exercise. 

§ II. In speaking of the difficulty that a working man 
has in rising to a po»t in which he can turn hig buainea 
ability to fidl nccouut, thu chief utresti bt commonly laid upoD 
his want of capital : but this is not alwav-s his chief difficulty. 
For instiince the cu-opemtive distributive wMietic*! have 
aceumulated a vast capital, on which they find it difficidt 
to get a good rate of interest; and wliich they would be 
rejoiced to lend to any set of working men who could 
show that they hml the capacity for dealing with difficult 
business problems. Co-opeJtitors who have firstly a faigh 
order of buidncHH ability and probity, and MKUudly the " per- 



, and 

1 



THE ffORKIXC MAX'S OrPOItTTSnTEa OF RIKINO. 



360 



souo] capita! " of a great reputation atiiong their fellnwR for dook it, 
theso ipialitiefl, will have no difficulty in getting command of ' "''"' • 
enough nial«rial cnpitol for a coniridcmble imdc-rtftking ; tho 
real difficulty is to convince a sutfident uumber of those 
aroumi them thnt thfV have th««' n»rt> qiinlilicn. And the 
case is Dt>t vt-ry diffVrotit wh«n nii individual ondoavimrsi U* 

UjMiUuti fratn the orrliuary «oiircc« the loau of the capital 

' r©(|uir(Kl to start him in l)iisitie«*i. 

It i» true that iu nhiuwt t'vcr>' bnsineas there is a constant tor tho 
increase iii the ainouut ol ea[)ital ruquirMi Lu make a lair alart ; m mcwaw- 
biit thetxi is a murh innrT' rapid inerenise in ihe amount of !jJiJ„;^ 
capita] wKich is uwued by people who do not waul to use it,*"''"' 
theniHelveii. ami are so eager to Ipnd it out that thny will foreuiploj- 
accepl a cou^tautly tower and lower rate uf iut4>re«t fur it. 
Miieh of thi*< capital poK^eH into th« liandn of bankers and 
others, people uf ki-eii intellect aud reatlessenerjfy; people who 
have noclastpivjuHid^jiand care nothing for Micialdixtinctiomi; 
uitd who wniiM protiiptly lead it to anyone of whuse biisinesn 
_abitity iuid himcsty they were convinr«xl. To say nnthing uf 
lie crwiii that cau be got iu inaJiy biiBiuwasea frora those who 
%ipply the re<|inKit<> raw mntertal ur sUrck in trade, the 
oppurtuuities for direct borrowing ait; now so great that aa 
increase in the amount of capital reijuired for a ittart in 
liUMuess is no very ttt^iioiis obstacle in the way uf a penton 
who ha^ once got over the initial ditticulty of eai'niug n 
reputation for lieing likely to u&e it well. 

And perbjij»« a gn.-atcr (hough not ho coof^icuous aHei* 
idraiR-e to the rise of the wurkiag man Ls the gn)wing nmohiij 



fcompUxity of busineee. The head of a buninesa has now to ■*"**" 



IDS MB- 

' ityof 



^^piink of many things about which he never used to trouble ^^j^** 
^^inij^If in eivrlier diiyf< ; ami tht-se are just the kind of diffi- 
culties for which the training of the workshop affords the l«aot 
preparation. Against this must be set the rapid improve- 
ment of the education of the working man not only at school, 
but what is inore important, in after life by newspapers, and 
from the work of co-operative aociotics and trado« unions, and 
other ways. 

About ihreo-fourths of the whole population of England bntbpmaj 
■ I ■• 111 1 ttvercome 

Moug to the wage-earning cla^iHnt ; and at all evenljt when 

U B4 



370 



BU8UIESS KANAGBUEMT. 



nMK tv. they are wt>n fed, proporly liousod and cdncAtiKt, the}r 
° "' '" * tbeir fair share «f that iiervdUH streugth whioh is th« 
material of biisinc^ ability. 



tlieee 
difficaltiea. 



Tlwriw 
luajrUke 



with 



Without goiag out of 
way thfy art' ilII iXJiisL-iuiiKly or iiiK'oiiw.'itniBly cunipuUlore (or 
posts of btisintws command. The nrciiiiary workman if 
shows ability guuemlly bocomen a fon>umn, from that be 
rise to be a manager, and to be takeu into poiiDerehip 
hia employer. Or haviug savtiil a little of bin ovru he mnjr 
start one of thoiw small shops which .still can hold their own 
iu a working man's t|uant'r, .stock it chieily uu crtiJit. and let 
his wife atti^nd to it by day, while ha gives hit< cveningn ta it. 
Ill the^:; or in other ways he may iiicrt:ase his capital till he 
can Ntart a small wtirkHhojt, or factory. Once haWng made a 
good begLuimig he will find the bank» eager to give him 
generous credit. He uiiittL have time ; and sinco he is uot 
likely to Htart in business till after middle age he must hare 
a long a» well u» a s^trung life: but if he haa this and has 
also " patience, goniiiii and good f<jrtnne " he is pretty sure 
to comiuand a large capital before he dies'. Iu a tiictary 
those who work with their hands, have better op|j<>rl«nitie*> 
of rii^ing to posts of eommiuid than the book-keepers aud 
many others to whom social tradition has assigned a higher 
place. But in trading conccm>i it ut otherwise; what luaaual 
work is done in them has as a rule uu educating charact^T, 
white the expeiiencti of the nflice is better adapted, for 
proparing a man to manage a coaimercial than a m. 
factnring business. 

There is then oil the whole a broad movement from 



ea lor 

3 



' Tli« U«rLnaiiH adjr tlial incceiH ill buMuesa reqnirM "(lolJ, (!«ilaU. (loik 
mhI CilUck." TLi! uliiuitvB IbitL a workiiis-uiuii hu of rfafuK "ao* MUMwlut irttb 
the iintnrr n1 tltn work, beitif; BraiiU-nl iii tlioMi tmlrn In «liicti • r«jcftil ■tlailiifli 
t<i dvliiilH 4'oiLtjLt fur luust. oijil b witici kiiuivkilKc. olielJieT uf •ckncw at of tbi 
wiirlil iiiovi-iiiiiiitii (if iqHTuliitian. caantntm loinl. TLdh ti>r ImMim* " tluflt Mid 
tha ktiiiwla<1|{c of itnicClcal ilL-tollti" ftn' tlio uioitl imjiarliuit dDRiBnta of winmw ■ 
Uip nnliiiiirj vimV nl tiia piilli^ Tra.d(i; Uiil In r»nMi^naiinp nuMil 'if Ibo** xlao 

Lave iliiuu wcU in it "Lavi- riwu fruia Uie bcturh Ukc iToiuh WalKwont*' tR* 
Mr O. WciIkwikhI's vvlilviicvi InJriro the CiHtiuii»»lou an TcvUiiieal EilmatiMi): 
aud a Hliiillw itiilniiici]! msuhl Iw iimilu itl»tit uaii; uf tbo Sliaffiakl trad**. Bat 
Willie uf tlio working rUxiw dtvolrp ■ grimt twralty for taklBK opMCvlatlVB rbkt: 
and If Iha knnwludt;o of fiu^U liy wIufIi aiii-Miiiiral aiiMnlatian tanat W fVlM. 
cumim wUhin tbcir rcuflh, III^ nill t,1t»u fnfit thoir war tbron^b coiiB|«tit(tt« oto 
luLvc atarUxl nbuvv tlicin. S"iiio uf lliv bimI ancocaifal irliiilnnaln jaaliiii U 
tioHobshk (TonmiiidlUcn vaeb an liaii auil fmit bare began Ufa a« inafkct yortan. 



A RAPID RISE NOT AT.WAVS AN UNMISED UBNEPIT, 



S71 



iqroardfc There aiv perhaps not eo many who rkc at ODce' iwpr r*. 
fittm tfc* position of workiug men to that of emplojere : but ' "'• '" ' 
there wc more who get on gufficicntly for to give thoir iw«««^»- 
aunK a jj^mmI chaiicre of atbiiniug to the highctit poxUi. The iii»t«*d<jr 
oompltitc rise ia not sm> very often accomplished in ono goncra- **""' 
tiou ; it LH more ofLeii upreatl over two ; but the total volume 
of the movement upwards \» probably greater than it has ever bnt Uut 
bt*u. Aud it may be rymarki.*d in passing that it in better nn!!ii?«S 
for societv as a whotu that the rise iihoiild be distJibuted over "''^ 
two geneiatbuK The worlcuiuii wIid at the begiuuiug uf thiti 
century rose in such large numbers to become employers 
were seldom fit fur poets of command : they wun* too often 
harsh and tyraimical ; tliey lost thtuir self-control, and were 
neither tnily noble nor tnily happy; while their children were 
ofttn haughty, extravagant, and suLf-iudiilgeui. squandering 
their wealth on low and vulgar amusementa, having the 
wont fault?) of the older uxutocracy without their virtues. 
The foreman or ttuperintendeat who has slitl to obey as well 
88 to command, but who is rising and neoH biH children likely 
to rise further, Ls in some ways more to be envied than the 
small fitaHter. His ducce^s is loss conspicuous, but his work 
\» oHvn higher and more iiuportauL for the world, while his 
character is more gentle and refined and not Ivss stn)ng. 
Uis children are well-tiuined; and if they get wealth, they 
are likely to make a fairly giKx] u»o of it. 

§ 12. When a man of great ability is ouce at the be^ of An bMc 
an tndopendent business, what«vor be the route by which he „t^ *" 
has got there, he will with moderate good fortune, souu K- ^^'g*^^^ 
able to show eucb evidence of htB power of turning capital to *■>* ufU^ 

• > • ■ ' . " "^ , at hli 

good account as to enable him to borrow m one way or another oaumund 
almoeb any amount that he may need. Making good profits 
he adds to his own capital, and this extra capital of his own 
ia a material security for further borrowings; while the fact 
at be has made it himself l«uds to make lenders less caruful 
insist on a full security tor their loons. Of course fortune 
p. much in business ; a very able man may tiud 
gtnng against him ; the fact that he is losing money thnnicb ba 
may diminish his power of borrowing. If he is working (ji^tlillS'-'' 
partly on borrowed capital, it may even make those who'**'"'''*'' 

24—2 



372 



BITSIKESS WANAORUKFr. 



Huux IV. have l«nt 



K'itli boT- 
MflUl. 



I 



refuse to renew their Iuuik, anr] may tt 

him to Kiiccumb to what would have bcvti but a pas ^ 

fortuoe, ifhi^ had betfU using uu capita] btit hU own' : and b 

fighting hui way itpwarda he may hare a chequeTvd life fall of 

great anxic-tif-8. and eveu tnUTurtiiaiJti. But he can ihow his 

ability in iitiNforlune as well as in succeas: human nature is 

sanguine ; and it i» notoriouH that men are abutidaiitljr wiU* 

iug to k-nd to tho»c who havi- pawed through comtnercial 

disaster without loss Uj thc-ir bmant-ss reputation. Thun, id 

Sfnte of vicnssitiides, the able bu!<>iue8s man generally f!ti<Li 

that in the long run the capital at his command grows in 

proportion to his abJIitr. 

A nan «bn Meaiiwliilc hu, wbu with small ability is in command 

grwtbiKi- largi- capital, speedily loses it : he may perhaps be one who 

£«M^'^ could and would have managed a small business with credit, 

Jf*'"' and left it stronger than he had ftumd it : htit if he has not 
toomorc " 

wpUJr J^ the geniiis for dealing with large problews. the larger it is the 
iMMdiMn ii. mora speedily will he break it up. For as a rule a large 
bufline«8 can be kept going only by trausactions which. aft«r 
allowing for onlinary lisks, leave but a rery small percentage 
of gain. A small prolit on a large tnm-over i^uickly madft, 
will yield a rich income to able men : and in those businMG«s 
whirh are of bhcH a nature as to give .leope to very lorgp 
capitals, eompeiition generally cute the rate of profits on tht* 
turn -over very fine. A village trader maynmke five perccoL 
less profits on his tnm-ovor than his abler rival, and yet)H 
able to holil his bead above wati-r. But in tlitjtie large mann- 
fnctiiring and trading businesses in which there is a (|ui<^ 
return and a straightforward routine, the whole profits on the 
tiim-ovcr are often so very small that a person who falU 
behind his rivals by even a small pereeutage loses a large 
sum at every turu<over ; while in those targe biistuesBes which 



I 



I Tliv ^Hi|C?r of iKit IkJiiK al'le tn rDBPw litii boirovuiipi jaal al Uu tlnW 
liif wiiiilfl tliftn Diunl, \>ali him at n iliuulY&iilajr? nJaliTcly to Ukum who vim 
tlidr oth Mitiltol, luach gamUsi Uiui Is icpreMiiUd by tbo more tatooM at 
bdinyinnfiii: and. wluoi we eaaut to llial pari at Uin dnclritu; el DutrilnitUiD «Udi 
<ltw1» iritli Rurnlnsa at UaiiaoMnMit, wa Bliklt And tlial. tor Itila auuag aOm 
it*u)it», iiruUta aw MiofrUDiiK mora tluui intanwt Ui addiliou t« Bunlnss «( 
Maaaf «Ui»iit pr<i|>vr, i.p. ILoae aaxiiiiiKa wlildi arc i>r(ip«rljr 1« W anrritvj to lfc« 
budnvM abilitic« ol tboH wbo, wlito auplujius their own capdial, gut fall pradti. 






'tiOicult ajtd d(j not n>ly uti rouliiie, Btid which afiVtrd high 
|ii'<itiLs (111 the tuni-ovpi' ti» n-nlly ahlv iiiaiiagt'int'iit, there lire 
no profit* at all to bo got by anyone who atteniptM the task 
wit,h only ordinary ability. 

Themf two M-ts of forces, the one increasing the capital 
at thv coDunaad of able tneu, and tlie other duotniying tho 
capital that is in the hand^ of weaker men, bring about the 
result that therw Ik a far more d<jse corresjiondt^ncH bi!tw(;t>ti 
the ability of business men and the ^ize of ttie b(Mine.s»*eji 
which th<;y own than at find si^ht would appear probable 
And when to this fact we add all the many routes, which 
wc havt: aln^udy diMrusfled. by which a man of great, uuturul 
bn«ine») ability can work his way up high in aome private 
firm or public company, we may couclude that whi;R'ver there 
is work on a large scalt! to bu ilorx^ in Mich a <'onntry a« 
Elugland. the ability and the capital required for it are pretty 
sure to be npL-t^ily forthcunung. 

Further, juat as indutitrial ctkill and ability are getting 
ever}- iluy to dupund more and moru on the broad faculti<» 
of judgment, promptness, resource, carefulness and steadfast- 
ness of purpose — facultiuu which ar<.' not t)peciali:K.*d to any 
ou« trade, but which are more or less useful ui all — eo iS, ie 
with regard to busiuces ability. In fact butanes ability con- 
in«t« more of thwe general and non-»pecialiied fticultifa* than 
do industrial skill and ability in the lower grades: and the 
higher the grade of business ability the more various ore it* 

K plications. 
Since then buHinesR ability in command of cajiital moves 
th groat ease horizontally from a trade which m over- 
twded to one which itfiem good oponingH fur it : luid since it 
rnuve*^ with great ea*e vertically, the abler men rising to the 
higher \K»it» in their owu trade, we may coticlude that iu 
modem Kngland the supply nf buKinewi ability in TOinmaiifl 
of capital occuuiniudutett il*ielf, sa a general rule, to tile 
demand for it. 



Thoai' two 

f MDM UuJ 
to odjutl 
ttig cnplUl 
tutlia 
iibitit* re- 
(jnirod lo 
o«o II noU. 



BnolnNs 
tbililj 111 

couimaiKt 
of rapildl 
liiu II fmrtf 

jmce til 
aucli A 

POIlllU; u 

£ti|tlKnil. 




TIum1>- 
donb 
whieb tbe 
Ifttcr 

ataiiil U) tliv 

oarlier. 



Aanmiiikn' 
lit til* Utu 

of lliiii 
Book. 



COSCLDSinN. THE T,AW OK [NTREAKIXfi TX RELATION 
THAT or DIMINISHISG RETURS. 

§ 1. At the beginning' of this Book we saw how tH 
extm Return of raw (miduey which >Jatur« afTtmls tci &ii 
increasec] application of capital and labour, other things being 
equal, iL'iuls iu ih*.' lony nm to diiuiuish. In the nttnainder 
of the Book and especi-iilly in the last four chapters we haw 
looked at the othiir Bidu of the shield, and seen how man's 
power of productive work iDcrcases with the volume of the 
work that he does. Conxidering first the cantie< that delor- 
miue the Supply of labour, we saw how every iniTeaxe in 
the physical, meutal and moral vigour of a people made 
them more likely, other things being equal, to rear to adult 
age a large luiinlitT of vigoruua children. Turning nest 
to the Orovrth of Wealth we observed how every increase of 
Wbulth tends in many wa.y» to make a greater increase 
more easy than before. Aiid lastly we saw how every in- 
crease of wealth and every increasv iu the numbers and 
intelligence of the people increased the facilitien for a highly 
developed Iiidu.>*triul Orgaiiizatiou. which in its turn adds 
much to the collective efliciency of capital and talmur. ^M 

Looking more closely at the econoniies arising from an 
iiicreanie in the scale of pmduction of any kind of goods, we 
found that they fell into two closses^ — those dependent im Iha 
general developmeut of tbe industry and those dependent on 
the resources of the individual houses of business engaged i 



EXTERNAL AND INTEHNAL ECONOMICS. 



S75 



it ttutl the fflficieiicy of their management; or. as we may say. noox it. 
inlo exteritui and internal ectiuomi«». ca^^im. 

Wo (taw how them latter economieit are liable t.u cuiiBtant 
tluctuatioDs flo far ai» aur particulaj' huuse is coiicenicd. Aii 
abic- inau onsiHtucI pcrhuj^ by Home Btmkt» 4>t' gfHicI fortune, 
gets a tirro footing in the trade, he worlca hard and livc« 
sparely, bis own oapitnl grows foul, and the credit that 
eoables him to borrow more capital grows still &eter ; he 
collects around bim ^nbordioatcs of more than ordinary zeal 
and ability; aa his business increaaea they rist; with him, 
thoy tnist him and he truats them, each of them dcvot<^e 
himttelf with enei^ to jtuit that work for which he is 
specially fittc-rl, no that no high nbility is wasted on easy 
work, and uu diffivuit work l^: entnmtt^d to utiKkiirul handa 
Corresponding to this steadily increasijig economy of skill, 
the growth of hix buHinBWi brings with it similar eeonomies 
of sp^wialized machint:-^ and plant of all kinds; ovcrj' im- 
proved proc«!» iH (quickly adopted and made the basin of 
further improvements: succew brings credit and credit bringK 
success ; credit and auceess help to retain old cualomers and 
to bring new one* ; the increase of his trade gives him great 
advantages in buying; hia gocHls advertiae one another, and 
thus diminish his diRiculty in finding a vent for them. The 
incrfttrtf- in the acnle of his busiucsw iucreaaes rapidly the 
advantages which he hatt over his oompctitorM, and loweni 
the price at which he can nffiinl to sell. This procetw may 
go on a» long lui his energy and cuteqirlMc, his inventive 
and organiidug power retain their full atrength and fresh- 
neee. and ho long an the rinkit which art- inseparable from 
bufiiDeffl do not caiu« him exceptional losHoe; and if it could 
endure for a hundred year», he and one or two others like 
him would divide between them the whole of that biunch of 
industry in which he is engaged. The large scale of their 
production would put great economies within tlieir reach ; 
and provided they competed to their utmont with one another, 
the ptiblic would derive the chief benefit of these economies, 
the price of the commotlity would fall very low. 
But the brevity of bumaii life and the still greater 
cvity of that part of it in which men's best Acuities 



>VtB 



THE LAW UF IN'CBEASJNU RETL'RX. 



tooKvr. are ill full vigour prevents this concciitrution. After 
* "• "" • the giiidiuic^ of the husinpss fails into thi- hands of 
Svmauizf, with Icsa energy and less creative genius, if not with ie» 

active iiitunMl ill its pruspurity. Perhaps it decays altogethti^H 
peTha|)i4 it \» carried im with inori; or le^H wti^loin nnd^l 
ability hy a private hrm or a public company. It inajr thus 
retaiu thi.- advantages of divi^on of labour, of 6pecisli2«d 
skill and mochinei;)-; it may evc-u iucreoAC tbeui by a further 
increase of it£ capital ; and under favourable cooditirais it 
may secure a peniiancnt and prominent plara- in the work 
of production. But it \s almo»t sure to have lost moth 
of its elasticity and of itji progressive force; the odvnnloges. 
are no longer yxcliiMivoIy on it*i eide-iu its cooipetiUon with 
younger and ^niatlcr rivak; it con no longtT obtain fr 
every inoreaae in its scale of production the mcjuis 
reducing considembly tho prieo at which it sells its good*. 

The growth and tht? doeay of the energies of a 
biiinuess cstabllehment seldom follow twice on exactly tb 
eaine lines even in the same trade: they vary with 
varj'ing incidents of the life and furtuue, of tho per 
friundKhipii and the bumae!« and family conneetionR of 
iudividuaht concerned ; but they also vary much from ot 
tmdo to lumther. Tliiis for instmici> an single very larg^ 
busiiieHS has appeared in agricnlturf. while in banking 
insurance, tu tlie supply of newK, and in transport by lam) 
seat such Ktnall hiiKine.sse.4 as i^till reinain find a eunstantlv 
creaidng difficulty in holding their cvwii. There in no nile ■ 
univetsal application ; hut the struggle between the 
strength of steady-going firms with large capitAlf on the ■ 
hand, and the 4^uick inventiveness and energy, the su{^c 
and power of vuriutiou of their smaller rivais on the oUior, 
seems inclined to ieeue iu the large inajonty of c«>sea iu the 
victory- of the fonncr. Wo may conclude that aii a general 
rule, eiihject to important exceptions, an incroase io tbo total 
volume of any branch of production tendn to ittcrease in an 
even greater proportion the average «i!6 of the buaneeeee 
engaged in it. 

When therefore wo are oonaitluring the hroad reaui 
which the growth of wealth and population exert on 



ITS BEARINO ON MAR«LVAL SLTPLY PBICB. 



» 



wonomies of production, the general cliamctyr of mir con- 
cluBiou^ ia ut»t wry much affixted by tKo tacts that many 
of these economies depend directly on the isize of the iudi- 
Tidnol cstablighmcDtfl engaged id the production, and that 
in almoftt everj- trade there is a comsUmt risi* and fall uf 
lugo busineeece, at any on» moment some firmH being in the 
ascending phase and others in the descending. For decay 
in one tUrection is sure to be more thnn balanced by gro\vt,h 
in another in times of average prosperity. 

Meanwhile an incrwiute in the nggregato scale of prodiic- 
tio7i of coiirsi- incrctLsos those cwjnomios which do not directly 
di^p«>nd cm thu size? of individual housw of bn^^iaeHO. The 
liiu«t important of these result from the growth of correlated 
l>rancln!S of iiidnHtnr' which mntually a*swt one anothtr, 
perhaps being e*incentrat«'cl in the mum- localitii^K, but any* 
how availing ihemsulves of the modern facilities for coni- 
municutioii nfft-rcd by steam transport, by the U-Iegraph and 
by the printing preaa. The economies arising from such 
eoiirocH as this which arc accessible to any branch of pro- 
duction do not depend exclasively u|)on its own growth ; but 
yet ihuy aix- nun: tu gntw rapidly uud steadily with that 
growth; and they are sure to dwindle in some, though not 
in all rt-apect*. if it decays. 

These results will be of great importance when we come 
to disciias the causes which govern the supply price of a 
commodity. Speaking generally, and leaving allowauce for 
Clues to be made separately, we now see that we 
nay ncgloct the fact that whi^n more of a commodity is 
wanted, the extra production is very likely to come &om 
Bome new prf>dueer jn^t KtruggUng into bu»incs^, who worku 
undor many disadvanliigeK, anil lias to bo Lvnituot for a 
time with little or do profits, but who is satisfied with the 
fart that he is ustiiblitiliitig ii coiineetioTi and taking the 
fii"st steps towards building np a siirctMsfiil business. For 
aJlliough t.hi)i extra produce may sometimes be raised at a 
greater c<tst of labour and sanrifi(?e than that which went 
before, even in an industry which derives great ccon«mi(» 
horn production on a large scale, yet the general nile will 
rile the other way; and it wilt more cunimonly be got by 



BOOK 17. 

OS. tilt. 




Tlioliou-' 
nwiilta 

oil tllR 

■■lo'ly of 
Ih* i>qnlli- 
briuui 111 
•lemaixl 
uid imfifif 
In Uie uoll 
Buok. 



nifiiil. 




8001 IV. iucreasiiig the output of buainewHis already cMtablitihcd, at 
"'•"" ' letw thau prupurtiouale cost of extra labour and sacrifict. The 

way is thus pri:parvcl t'ur Ihc ^ciifiral thc-ory of cquiUbriui||^| 
of demand aad supply in the next Book: and we may tba^* 
regard au iucryasi; iu the aggrcgutHi volume of production by 
auy branch of manufacture as likely to be attained geDenl|H 
at a less than propartinnate ooet of labovir and nacritioc, 

But before closing the presenc Book wo may stay a little 
to consider the bearing of its results on the problem of ti^M 
pretuiire of population on the means of Bubsistence. We are 
not yet in a position to deal with it thoroughly, but thorc is 
flotne advantage in taking a rapid survey of it at thin earlystage. 
Jo § 2. Onr discussion of thi? character and organizatiou of 
i^j induBtry taken sa u wholu tuuils to show that an increase in 
bealwKys the volume of labdur cauBes in jzenem). other thinirs beini? 
yqual, a moru tlian proportionate incresjie m ihe total effi- 
ciency of labonr. But wo must not forget thai other things 
may not by equal. Tli« incr»«u* of miuibers may be aooum- 
panicd by a more or leias general adoptioD of unhealthjr aad 
enervating habita of life in overcrowded towns. Or it may 
have started badly, outrunning the material resources of th* 
people, causing them with imperfect appliances to make e|^| 
ceeeive demands on (he snil; and so to call forth the stem 
action of the Law of Diniinisliiug RL-tum as rt-'gurds raw 
produce, without having the power of miiiiniixing its efiecis : 
having thus begun with poverty, an increase in numbera 
may go on to its t*io frequent consequences in that wcaktwss 
of character which uufit* a people for developing a highly 
orgatiiited industry. ^M 

All this and more may ba granUtd, and yet it remaii^' 
scufraiiT "" true that the collective efficiency of a people with a girea 
SlwrethMi ^v"™*?" ^^ individual ittrength and energy incrcoiiea mnre 
i.iv>|>nrtioTi- than in proportion to their numbei* If they can import as 
«i MUx- mui-li food OS they want on easy tcnns. and, by Ihu or other 
means, escape from the prea.<iure of the Lew of DiniLQishin}; 
Return so for as raw produce gees; if, as may be rL-asonably 
supfMMd. th«ir wealth increases at least aa fast aa iheir 
numbers; if they avoid habit« of life that would enfeeble 
tbem; then every increase in their numbers is likely to briof; 



an IncTMM 



tlT<iaffl 

do-iiry. 



FORMAL STATEMENT OF THK LAW. 



S7E 



n 



a. m«r« than pnjjwrtionatc incrcaMC in their power of ubtaiii- 
iiig materia] gcjods. For it enables them to secure the 
many various ectjQotnieK of ^pvcislizud skill tuid »pfcializcd 

tbiuery, of lucalizcd industries and productiou on a large 
it enablvb tlivm to havo increased fucilitiu8 of coin- 
uunication of all kinds; while the very closeoess of their 

;hbfiiirhood diitiitiishcs the expense of time and effort 
Ifolvod iu every Bort of traffic bt'tweon them, and givL-s 
thorn new opportimiries of getting social enjoyments and the 
Ct>mfort(i and luxurii^iK of oultlire in every fi>nu. It is true 
that against this must be set the growing diffieultj of finding 
solitude and quiet and oven fresh air'. This deduction is a 
weighty one; but there still remains a balnnce of good. 

§ 3. Thus then while tho part which Nature plays iu 
production coafomiH to the Law of Diminish itig Return, the 
port which niau plays conforms to tht; Law uf Increasing 
Retl'RX, which may be Ktatad thus: — An increaHe nf capital 
and labour leads generally U^ an improved orgamwittou; and 
then^fure in thuML- indiislriee whi<.'h are uot engaged in raining 
raw pmdiice it gencnilly gives a return increased more than 
in proportiou; and furthLT this buproved organization tenda 
to diminish or even override any increased resistance which 
Nature may ofl'er to roisiug iucreased amoii nta of raw ]>roduc^'. 

Taking accoimt of the fact that an incrtsahiiig density of 
population geuemlly briugs with it accexs to new social 
joyments we may give a rather broader scope to this 
itcmciit and oay: — An increa»c uf population accompaotcd 
"by an equal incre-ase in the material sources of enjoyment 
and aids to production is UlsL'ly to lead to a more than pro- 
portionate increase in the aggregate income of enjoyment 
of all kindx; provided firntly. an adequate supply of raw pro- 
duce can be obtained without great difficulty, and aecoudly 



nooK IV. 
CK. xni. 



of [utrtod- 
iiV Jlttmn. 



\ limiiilFr 
ntntdlncli I 



Tho EnBliihiuaii Ufl] \iant» into nTin-ankxl «iitliaiilMin whm B|««Uiig 
, Book ir. Oil, VI, g 3.1 of tho plNtanrrs of wuirlcrjiift ftluiia in 
y: An>ricMi rtaiiomiKM fram Curj to Mr Htmry Ouurg* tin 
len <liBruteri«tlmll7 bm Ui«tr lil(:bMl «Joiiooiic<> In Kiil'tnicllil dflKriptlotm of 
tba growing ricbncM of huraui life u Uia backwoodnukn finds ndghbonrs 

«ctUi»|[ Aronnil him. »■ tlia liacknooilii MttUcoirUt dcvolopea into a village, tli« 
tiUaCB into a tawu, nud tbc Ivwu inloH vut «it;, (i^furiiutUkurai Pros'Mi tm4 
I Pavrrtt, Book it. Ch. U.) 



380 



THE UW OP Ut'CRUAHlSU lUETURX. 



HOOK IT. 
an. till. 



V nnmlivv 
anutba 

ovahj 

iraiu tliuM.' 
of the 
growtli erf 

n«Kj[|) Iij 

ivhi'.'ll it IB 

gviicmlly 

■lOVtllU- 

p*nlod. 






them 19 no such overcrowding m causes phystca.1 and 
vigour to be iiiipairui] by tht! want of freoVi air ilikI light luitl 
of healthy and joyous rocrcation for thi.> young. ^M 

■The aecii miilated wealth of civilizt-d ooimtnL's Uat preBeni^^ 
growing fastt^r than th*- popiilAtioTi: and though it rany 
true that the wealth per head would increase eoiuewl 
faster if the popiilatinn did tiot incrtrasir ijuitf so last; yet 
a matter of fact oii inl:^^ea^e of population is likely to con^ 
tiime to be at'Comjiatued by a rnon; than proportionate in- 
crease of the material aids to prorJuction : and in a eountrr 
Mich an lilngUnd is now, with (;a«y access to abundant fnrpign 
supplies of raw material, an increaflf of population is accom- 
panied by a inure than proportionate increaae of the- ini-juut 
of satisfying human want* othi^rthaTi the need for light, fresh 
air, &c. Much of this increase is however attributable not 
to the increaw, of indut^trial efficiency but to the increase of 
wealth by which it Is flccomponied; and ihemfoi-e it docs uot 
necessarily benefit thost who have no share in that wealth. 
Aod further. England's foreign supplies of raw produce may 
at any time be checked by chang-es in th? trade K-gulations of 
other countriea, and may be almost out off by a groat war^_ 
while the uaval and military expenditure which would b^| 
necessary t-o make- the country Ihtrly secure ngainst this liut 
riflk, would appreciably diminiKh the benefits that she derive 
frum the action of the Law of Increa«ng Return. 




BOOK V. 

The Theory of 
THE EQaiUBBTUM OF DEMAND AND SUPPLY 

WITH 80HE CONaiDEBATIONS AB TO ITS BEARINQ ON THE 
DOCTRINE OF MaXIUUH SATISFACTION. 



CHAPTER I. 



OH UAUKETS. 



uid Hiippiy, 



§ 1, In spite of a great variety in detail nearly all the book v.j 

chief prohltfins wf eotmomica agree iu this that ihey have a 1_ 

kernel of the same kind. This k€-nirl is lui innuirv as to the '^""^ , . 
. . / ' . twoiiouii&l 

DAlancing of two opposeo dosses of motives, the one consist- molilona , 
ing of desires to ocigiiirc eortnin new t-cuiioinic gcKxiw, and the cmnmnn 
other of desires to avoid certain efforts or rct-aan certain J'^'J*,^"' 
immediate enjoymentia or ofchpr economic goods, the command '!;" '^'"'^ 
over which ham alrejidy been acquired; or in other words ittiemuud 
is an inipiiry into the halanmng of the forces of Demand 
and Su])ply, Uiuau tonus being U!<ed in their broadest sense. 
In the study of this equilibrium there is much that ie 
eommoD ground to many economic pmbleins, the other in- 
ddeDts of which have little in common, or may even belong 
to widely remote districts of the region of economica And 
therefore a gront mnng of time, an welt as some gain in 
scieutilic thoroughness is to be ntttiint>d by trcAliug this 
common kernel carefully once for all 

The ptirpofi© theu of the present Book is to examine the 
general cimditions of the Ktjuilihiium of Demand and Supply; 
illustrations will be taken now from one class of economic 
problems and now from another, but the n^asoning itself 
will bo kept ffoe from assumptions which specicLlly belong 
to any particular class. 

§ 2. When demand and supply are spoken of in relation I)«iltiltli 
to one another, il In of counie necesHar}' that the markets to uarktt. 



384 



UK llXitKEI^. 



HOOK V, 
CB. t. 



pot- 

I 



which they refer should bi> thf same. As Couruol 
" Economists iinderstaiid bj the term M-VliKET, not auv pat- 
ticiiiar marlcet place in which things are bought bihI wli 
but the whriltt of any region in which hiiyere and seller* 
in such free iutt-rcuurae vrilh one aiiotlier that the prices i 
tJie same goods tend to equality easily and quickly'." 
again o» Jevons nays: — "Origiually a luarkcl was a publi^ 
place in a town where pro^-ixiions and other objects were 
expoBed for sole; but the word ha^ been gcnemlizL-d. m u to 
mean any hmly of persons who arc in intimate buanees 
Tclaiiutift und carry on extc^usivc iruusactious in auy coni^_ 
niochty. A grt^at city may cntitain as many marketfl aa therl| 
ureiiiipurtaut bmucheaof trode.aud these niarketa may or may 
nut be localized. The ccntml point of a market io the public 
exchange, mart or auction room?, where the traders agree to 
mcot and tnui»acb buKine&i>. In London, th» Stock Market. 
the Corn Market, the Coal Market, the Su^r Market, and 
uuuiy othen^ arc distinctly localized; in ilauchester the^ 
CotCou Market, the Cotton Wast^:- Market, and othora. Bl 
thifi distinction of locality in not necessary. The tradenT 
may be spread over a whole town, or region of country, sod 
yet make a market, if they are. by meana of fairs, meeting*, 
published price li.tt^, the post ofHce, or othcrvis^. in clow 
communication with each other*." 

ThuK the mure nearly {K^rft-ut a tntirkot i», the stronj 
ii^ tho ttiiideuoy for the name price to be jiaid for the mti 
thing at the same liuu- in all part.>) of tht> market: but 
couniL^ if tho market is largo, nllowauce must be made 
the expense of delivering the goods to difFereni pnrchtwers; 
each of whom must bo supposed to |)ay iu addition to 
market price n tqwcinl charge on account of delivery'. 
BponOnlw § R. In applying economic ruaMiningti in practice it 
bmIch. often diAicnh tn ai^ct^rtain how far the movements of supply 
and deiuaiul iu any one place arv influencvd by those in 

' SMtf*it* *Mr la Priaeiptt Xalheinaliqnet dt la Ttfarir 4ea ffvA 
Ct.n. 

* TTinnry i}f Poliiteal Kivnoiaj/, Cli. iv. 

' Tim* il U riniintau In ■«<>tli» jirii-oii i<f liuUcj i;i>iiila '|ii/jI«I ■• il«livfTf<4 - I 
vu Iukr4" (f.u. b.) Kuj- vuhsdI hi « rartaiii p<in, each panhtiMr likvinj* l<i 
lib own rMkeniiiit tat Urinfpng llio fcaoAt bom*. 



I 

■ors; 

1 



THE ESTESSION OF A MARKET. 



385 



another. It is clear that the genci-al tendency of the 
tulugmph, the priutiug pix-ia oiid HtL-um truffic ih to extend 
the area qvct which euch infliieiictiH act and to increase their 
force. Tho whole Western World may, in a soDse, be re- 
ftarded as one to&rket for many kinds of stock exchange 
necuntie!>, for the more valuable metats, and to a Icssi extent 
fur wool and cotton and even wheat ; proper allowance beiiiff 
moch- forpxpfiDSPSof InuiHport, in which may b(? included taxe» 
levied by any customi^ houses through which the guuds have 
to pass. For in all thew caiteH the expenses of transport, 
includiDg customs duties, w-e not suffieient to prevent buyers 
from all parta (if tUn Wtstem World froiu competing with 
ODc another for the same siipplieN. 

There are nmiiy special cau** which may widen or 
narrow the maiker. of any particular commodity: but nearly 
all those things for which there b a very wide market are in 
iinivrntal demand, and cupablt; of ht-iug tasily niul exactly 
dc»cribt;d. Thus for instance cotton, wheat, and iron satisfy 
wants that are ur^nt and nearly uiiivecaaL They can 
be eaoily desaibed, so that they can be bought and sold 
by persons at a distance iroin one another uad at a iliKtanco 
also from the comrao<litiea. If necessary, samiilei* can be 
token of them which are tndy n:pre»cnlativc: and ihcy can 
u\'eii be " graded," us is the actual practice with regard to 
grain in America, by an indepisudcut authority; so that 
the purchajtor way be secure that what he bu)'s will come 
up to a given Mandard, though he ban never t^en a (lampte 
of the gooda which he i« buying and pL-rhaps would not 
be able hiiuf«lf to form an opinion on it if he did'. 

Commodities for which there is a very wide market must 
alBo b© euch as will bear a long carriage : they must bo some- 
what durable, and their value must be considerable in pro- 
portion to thoir bulk. A thing which U so bulky that its 



HOOK ». 
en. I. 



luvtntictw 
of voty 

iiiarktitii. 



Ovnrtti 
i-iniililiimi 

nfiw-l III* 

UttEUt 
t4 till! 
tllKlkut 

fiMKlliiiii;;, 
auLUlolitjr 
for |p-*iliu); 
nnil 
>iiiui>liiii: 



Portt- 

blllt;. 



I llm* Lb« muiftgtn of * imbUi: or private "rluvitur." r<ic«ive graiu (roiu 
% (kitDOT, 4ivi(l« it Lalo lUflvroul irmli-s, uiil ri:liuii tu liuu cortiflcsUs ht n* 
maiqr baihch of cxh gmdn h hd Iim ilcllTcrcil, III* miilii in Ihen luUtvi witL 
\hpam ot uUicr ruiuon; bin urtiflmilfti arc liltnlj tu cLaugB liaiiiln wirernl Utniu 
bflfoN ilia; reach b (■■u't^liiiH^r ultu (lumujnlii Uiat tLu i,-piLiu kIibU b« Actnallf 
■UlvtMd tA bho : mivl of nliAt that pnrcliurr ror4>lT#fi, llttla or luin* moT b&Tt 
oanm fnwD Um hna rf Uie origiuKl pecipicnt of the crrtifl«4tA 

U. 25 



'dan 



ON MARKETS. 



BOOK V. 
CS. 1. 



bitilily 

ainrki'U 
Ulnatralixl 
hj tvlvt- 
«iic« to 
■tnck 



price i» neces»arily raised very much whpn it is sold fcr ai 
from the place iu which it is produced, must as a rule hav 
narrow market. The market for coinmou hricks for instaiicv 
is practifaJly coufiuct] ta the near ucighbourhood of the 
kilns in which they are made: they can scarcely evt-r bear 
a long carriage by land to a district which has any kilns of 
ita nwn. But bnckn of certain excrptmnal kindei have 
market extending over a great imrt of England. 

§ 4^ Let us then consider more closely the ntarkuta 
things which eatisfy in an exceptioual way these condttifflw 
of being in general demand, cognixable and portable. They 
are, aa we have sai<l, etwk exchange securities and the more 
valuable metals. 

Any one share or bond of a public company, or any bood 
of a goveminent is of exactly the same value an any ulUcr 
of the same issue: it can make no diffleri-iioe t* any purchaeer 
which of the two he buys*. Some wwiirities. principally tiioeo 
of companktivuly small iiiiniug, slupping and oiher compani es 
require lorji.1 knowledge, and are not very easily dealt I^M 
except on thu kiuuU exehangt's uf proviueial towns iii the^^ 
immediate neighhniirlinod. But the wholt- of England is one 
market for the shares and bonds of a large English railway. 
In ordimiry tinier a dt-'aW will isl-U. 8ay, Midland Railway 
shares even if he ha.-* tiot them himwlf. because he knows 
they are always cotuiug into the market, oud lie in sun* to be 
able to buy llietn. ^H 

But the i^tr»nget>t case of all m tlrnt of Mucurities whn^' 
are called "inteniational" bt;cause they are in j«queBt u 
every part of the globe. They arL- the bundd of the chief 
governments, and of v^ry targe public companies such as 
those of the Suez Caual and the New York Central Railway. 
For l>on<lK of thiK cIiiMi the telegraph keep?( prices at almost 
exactly the t«me level in all the stock exchanges of the 
world. If the price of one of them ri»c« in New York «_ 
in Pans, in London or in Berlin, the mere news of 
rise tends to cause a rise in other markets; and tf for an| 
reason the rise is delayed, that particular cla^s uf bonds 
is likely soon to be offered for sale in the high priced market 
under telegraphic orders from the other markets, vhile deaJe» 



HIOHLT OBOANIZED MARKETa 



387 



in the fint market will be makin;^ tcU>j;raphic purchases iti hook v. 
othuT marhotei. These sales uu the one hajid. aud purchn»:s '^"•'' 
on th« othor, strengthen the tendency which the price bag to 
seek the same level everywhere; aiitl unless Home of the 
markets are in an abnormal couclition, the tendency «oon 
beoomeH irreaistible. 

On the fltnck exchange alwi a *Iealer can generally make 
Bure of HellUi^ ul uearly the ^ine price as that al whleh lie 
btiy» ; and i« oft<?n willing to buy first elaas stocks nt a half, or 
a (jiiartiT, or an eighth, or in some ca^es even a sixteenth per 
cent, less than he offers in the same breath to sell them at. 
And it is an iristnictive fact fur our present piirposeB that if 
there are two secimties «<iiially goorl, one of them being a 
part of a large uwiie of bonds, and the other a part of a sniall 
issue by the eaine government, »o that the Bntt is constantly 
coming on the market, and the hitter but seldom ; the 
dfaler* will on this aecoiint alone require a larger margin 
between their selling [^frice and iheir buying price in the 
latKJT case than in the former'. This illtistrate* well the 
gn--at law, of which we shall have inneh Ui say when we 
come to consider the influence of foreign trade on eco- 
nomic progress, that the Urger the market fur a commcxlity 
the smaller generally arc the Huctuatioos in its price, and 
the lower in the percentage on tbu tunmver which dtMilera 
charge for doing businetw in it^ 

Stock exchangi-s then an; the patteni on which markota 
ivc been, and are being formed tor dealing in many kinds 
of produce which can be easily and exactly dencribed. ore 
portable aikd lu general demand. The material cotnutodities tiir warU 
however which posses* these qualities in the highest degwrc uir\\J 
are gol<i and silver. For that verj' reason they have been l«*5j""» 
sn by common connRnt for iiw a.s money, to repnwent the 



1 la cxUmoe HIM the diffeiwnt'e lt«(«<cii the prici(> nt n'lilrl) ii iltutLar is 
Id liof »Mid Uutt at wlilitli lip *fUI Bi'll niiii'iJiitH t» tmiu flvn U> Lwcuty 
i, of tlio lelllns ralan of the xrarity, If Jie bays, la- tun; lure to «UT7 
Uill HCwitj B limi: time before lie niM-ts nttli nnj one vho comet l<i tklio it frua 
Un, laal tneanwbjln It tiui; fiJI in vmIhb: wliik if lie luiilertHke* lo itellvcr 
■ Menritf wlik'li lici ti98 not liiiaet'lT fiol muI wliinli (la» not cmuf nn Um luirkel 
mrwy S»j, bu ui«j tw uniblo to cmniileta lii« ouutrict wiUujuI mncbi troabU v>il 
expcuM. 

25—2 




wa paw ti> 



retail 

h 

^^M CUtlfilll!<l, 

^1 thi 



thnngk 
trroD Uiu 
la >nb]«rt 



inflmticcB 
■IkWiicM. 



value of other thuig^: the world maritet for the 
highly otgsnix&d, and will be found to oSier many eubtl» 
illuetnvtioiis of the actions of the lawn which we are no« 
(liscusfiiug. 

§ .1, At tKe uppoHtte extrenuty Ui iuteniationnl stock 
exvhaugi* securities and the more valnnble metals are thow 
things which nnwt be made to order to siiit {larticiiUr 
iudividuals, such as well fitting clothes. They eau searcol}' 
be Katd to have a wliult<iiale market at all ; thu conditioiut by 
which their price is detemiined are- those of retail buyiug 
and selling, and the Mtu<ly uf them may be ]Ki«t[Hmed. 

Turning then to whole-sale markets which arc coufitu^ 
withui ijanrow botuid^ri(». we may lind our typical ioKtauce 
in the sale of the cumiuoiier kinds of vegetAble? in a countrv 
town. The market gardeners iu the ucigUbuurhood h am 
probably to armnj^e for thu mUu of their vegetables to ^fl 
townspeople with but little external in ttrferenee on eit^«r 
side There iiiftv be w>me check to extreme jirioes by the 
power on the one eide of eellin^ and on the other of buying 
elsewhere; but undfr onlinary cirouniNtancet) the check is 
Luoperativv. It may however happen that name uf (|^ 
market gurdi^uent ore atmoet e<|Matly uear a second cdoh^I 
town, and send their vefjetahles now to one and now to the 
other; and some people who occasionftUy buy in the first 
town may have otjually good access to the aeoood. The Iva^t 
vaiiatiou in price will lead them to prefer the better market; 
ood thus make the bargaining*; in the two towns to eeatc 
extent mutually dependent. It may happen that this second 
town is in clow communication with Loudon or Bomc 
contra! market, ho that it^ priee^ an.! contr«)lIed by the 
in the central market ; aud in that ciitu? prices id our 
town also must move to a considerable extent lai harmony 
with ihem. As uowe passes from mouth lo muuth till a 
rumour spreads for away from ittt forgotten sonrco, ita> evvtx 
the moat secluded market is liable to be iofluenoed by ehauges 
of which ihose in the market have no direct oogniaaooe, 
obauge« that have had their ongiu far away and have sf 
gradually from market to market. 

Intermediate between the two extremes of world mailLelK 



second 
ir fiiV 



BprM^ 



IL MARKETS. 



389 



imrkoiH un; iho grwit mojurity of amrkets book t 
which the pcononiist anil the biiBinc!*! man have to study, *^"' ' ' 
It is always difficult to know huw much influence tu oasigii 
to the intlirect competitiun bctwucii distant markets; the 
ullowuiitx- to be made will often depend iipuu causot which 
cnit be detected only by thuau who have Hpccial knowledge 
of the fects; and in such cases much must be left to the 
trained inetincte of the tnuJois immediately concerned. But 
vumi: Hides of tlieisv difBcultiea are common to a. great 
riety of economic problems, and cannot be evaded by the 
'ecimouiiNt; tliey lake a prominent place in the discussion of 
Lucal Variations of Value, and in that particular branch of 
it which deftU with Foreign Trade; but we need not consider 
them further now. 

§ 6. Again markets vary with regard to the period of limlu- 
time which is allowed to the forecs of demand and supply to a^aX^ 
bring themselvc-s into eijiiilibrinm with one another, an well as "''^^i 
with KJipird to the area over which ihoy extend. And thiB tn time 

,*,_,. „ , , . "IImI til* 

element of Jimu recpurtju mure careful attention just now nnturc of 
than does that of Spaca For ttie uature of the equilibrium oi w'liidi'* 
itself and that of the causes by which it is detcnniuod, vatj" J^uve' 
with the length of the periud over whieh tbt uiarket is taken "'?"'"': 
to extend. We shall fintl that if the period is short, the r^-ioire 
aupplj is limited to the stores which happen lo b« at hand : ^^^ 
if the period is longer, the supply will be influenced by the j','n,»i'^„rt 
cost of producing the commodity in question ; and if the J''^' "''i''' 
period is very long, this cust will be iuflueneed by the eost of 
producbg the labour and the material things retjuired for 
pnxlLicing the commodity. This latter distinction will be 
seen to be one of degree only, and tu be not clearly aud 
firmly drawn : and even the former is not perfectly defloite, 
but yet it is definite enough to merit a separate dictcussion. 
Accordingly we nhall consider in the next chapt4>r those 
temporary equilibria of demand ajid supply, in which the 
cost of producing the commudity (.-xerlti either no inUucnce 
or merely an indirect influence. 



CHAPTER n. 



TEMPORARY EQUrLIBRIUM OF DIIIMAKO AND SUPH-r. 



BOOS V. 
CR. II. 

X lIlHptc 

liiaMu«e ol 

eqnililirimu 

ilnuirD Anil 



IbCNla 

gmtenUy 
110 tnio 

Tirinin. 



i«r 



§ 1. The simplest cose of equilibrium betweeo de^^ 
and effort is found wben a person satisfies one of his -vtaatt 
hy his own rlirect actiun, as fur instance when ho picks bUck- 
beniee. At first the pleasure of eating is much more than 
enough to repay the trouble of picking; in fact the action of 
picking may itself be pleasurable fur a lime. But aft«r h« 
has eaten a good deal, the desire for more diminishes; wbiU 
the task of picking bugins to caune weariness, which at j^H 
couuterbaiauces the desire for eating, and equilibrium^P 
roaehtKl. Thp aatlsfacliou which tie eiui get bma picking 
fruil has arrived at it^ maaimum : for U]> to that time ev«iiy 
fresh picking has added more to his pleasure than it ha» 
taken away ; and after that time any further picking wi 
take away from his pleasure more than it would athl'. 
I In a casual bargain thai ono person makes with ano 
as for instance when two backwuuditmen bart«r a rifle for 
canoe, there is seldom anything that can properly be called 
an equilibrium of supply and demand: th4<re U {vobab^H 
margin of .'Sitisfftction on either side. Probably the «|P 
wLiuld be willing to give something besides the rifle for the 
canoe, if he could not get the canoe otherwise, white the ot 
would in case of necessity give something benidep the 
for the rifle. 

It is indeed possible that a true equilibrium may 
arrived at under a system of bart-er ; but barter, thoDgh i 

1 B«c Mathrmnticnl Nnto ui. 



MA.RKET-DAV IV A LOCAL CORN EXCHAHOS. 



391 



history tbuii buyiag and selli 



18 in some ways more 
intricate: aod the simplest cancN of a, true c<)uilibrium are 
found ill th« markets of a more advanced state of civiliza- 
tiuD. 

§ 2i Let 118 take an illustration from a com market iii a 
countr)' towtL The juiiuunt which each fannvr or other 
seller offers for sale at any price is governed by his own need 
for money iu hand, and by his culculaliun of the prcstjnt and 
future cooditions of the market with which he ia connected. 
There are some prices which do seller would accept, some which 
DO one would rcfuso. Thcrearo other intermediate prices which 
would be uccepted for larger or smaller amotmtR by many or 
nil of the sellers, fjot \\s assuine for th«j sake of simplicity 
that all thu corn iu the market is of the same (jtiality. An 
acute denlor having corn tor sale may |)erliaps, after looking 
around him, come Iu the conclusion that if Ula. could be got 
ihroughoiit the day, the fanners between them would be 
willing to sell to the extent of about 1,000 ((uarLuni; and 
that if DO more than 3i!j. could be got, several would refuse to 
sell, or would sell only sinnll quantities, so that only VOO 
quarters would he brought forward fur sale; and that a price 
of 35». would only iuducu some 500 (juarteis to be brought 
fonrard. Suppose him further to calculate that millers and 
others would be willing to buy !)00 cpiarters if they could be 
got at ^oi. each, but only 700 if they could uot be got for less 
than 36«., and only 600 if they (^ould ni>t be gob for low thau 
S7*.' He will conclude that a }>rice of liGs.. if established at 
once, would eqnat<! supply and drmmid, because the amount 
offered for sale at that price would equal the amount which 
could jiwt find purchttsors at that price. He will therefcnv 
lake at once any offer cousiderably over SGs. ; and other 
Dsllers wilt do the Mime. 

Buyers on their part will make similar calculations; and 
any time the price should rise con»idenibIy above HGs. 



BOOK V. 

cn. n. 
borUhr infly 



tltuiitrBliuu 
frtaan 
\aea.\ I'oni 
tunrkci 111 
vLich u 
true UiuugU 
ttmpnrarj 

Llbrloin It 
tt'tclieiL 



Bi»L-rt irill be 
willfiiK (o big' 



* TUi nimlt of III* Mud; of t)i* iii«rk»l ma; b« pnt In a lahnliir tonu thiu 

ttt. :i» •M 



392 



TBMPOBAHY EQCILIBBIUM OF DSUAND A2>*D SCPPLV. 



nooxv. th«y will argue that the supply wrill l>e much grc«t«r tl 
"'' " ' the ilemaiKl at that price; therefore ovon those of them w^» 
would rather pay that ]>rice than go unserved, wait, and ^H 
watting l.h«?y help to bring the price tlown. Od the oth<!r 
hand whcu the priw! ie much beluw 86*. «veii those aellen 
who would rather take the price than leave tho markot with 
tlieir com unsold, may argua that at that price the detnanii 
will be in excess of the supply: «o they wait, and by waiti]^^ 
h(*lp to bring the prico up. ^| 

The price of 8Qif. ham thtis a claim to be called the tm* 
ec[uilihrinm price: bccauao If it were fixed on at the begin- 
aing, and udh^rud to thruugliout, it would exactly etjiukta 
<leniand and ^^upply ; and because every dealer who hw^| 
perfect knowledge of thi- circiimstancr,'* of the market expend 
that price to be estubliahed. If he Bet.i the price differinf 
much flrom 3fi«. he expects t