SUPPLEMENTAL READINGS IN MICROECONOMICS

                       INTRODUCTION AND PLAN OF THE WORK 

 
     THE annual labour of every nation is the fund which
originally supplies it with all the necessaries and conveniences
of life which it annually consumes, and which consist always
either in the immediate produce of that labour, or in what is
purchased with that produce from other nations.
     According therefore as this produce, or what is purchased
with it, bears a greater or smaller proportion to the number of
those who are to consume it, the nation will be better or worse
supplied with all the necessaries and conveniences for which it
has occasion.
     But this proportion must in every nation be regulated by two
different circumstances; first, by the skill, dexterity, and
judgment with which its labour is generally applied; and,
secondly, by the proportion between the number of those who are
employed in useful labour, and that of those who are not so
employed. Whatever be the soil, climate, or extent of territory
of any particular nation, the abundance or scantiness of its
annual supply must, in that particular situation, depend upon
those two circumstances.
     The abundance or scantiness of this supply, too, seems to
depend more upon the former of those two circumstances than upon
the latter. Among the savage nations of hunters and fishers,
every individual who is able to work, is more or less employed in
useful labour, and endeavours to provide, as well as he can, the
necessaries and conveniences of life, for himself, or such of his
family or tribe as are either too old, or too young, or too
infirm to go a hunting and fishing. Such nations, however, are so
miserably poor that, from mere want, they are frequently reduced,
or, at least, think themselves reduced, to the necessity
sometimes of directly destroying, and sometimes of abandoning
their infants, their old people, and those afflicted with
lingering diseases, to perish with hunger, or to be devoured by
wild beasts. Among civilised and thriving nations, on the
contrary, though a great number of people do not labour at all,
many of whom consume the produce of ten times, frequently of a
hundred times more labour than the greater part of those who
work; yet the produce of the whole labour of the society is so
great that all are often abundantly supplied, and a workman, even
of the lowest and poorest order, if he is frugal and industrious,
may enjoy a greater share of the necessaries and conveniences of
life than it is possible for any savage to acquire.
     The causes of this improvement, in the productive powers of
labour, and the order, according to which its produce is
naturally distributed among the different ranks and conditions of
men in the society, make the subject of the first book of this
Inquiry.
     Whatever be the actual state of the skill, dexterity, and
judgment with which labour is applied in any nation, the
abundance or scantiness of its annual supply must depend, during
the continuance of that state, upon the proportion between the
number of those who are annually employed in useful labour, and
that of those who are not so employed. The number of useful and
productive labourers, it will hereafter appear, is everywhere in
proportion to the quantity of capital stock which is employed in
setting them to work, and to the particular way in which it is so
employed. The second book, therefore, treats of the nature of
capital stock, of the manner in which it is gradually
accumulated, and of the different quantities of labour which it
puts into motion, according to the different ways in which it is
employed.
     Nations tolerably well advanced as to skill, dexterity, and
judgment, in the application of labour, have followed very
different plans in the general conduct or direction of it; those
plans have not all been equally favourable to the greatness of
its produce. The policy of some nations has given extraordinary
encouragement to the industry of the country; that of others to
the industry of towns. Scarce any nation has dealt equally and
impartially with every sort of industry. Since the downfall of
the Roman empire, the policy of Europe has been more favourable
to arts, manufactures, and commerce, the industry of towns, than
to agriculture, the industry of the country. The circumstances
which seem to have introduced and established this policy are
explained in the third book.
     Though those different plans were, perhaps, first introduced
by the private interests and prejudices of particular orders of
men, without any regard to, or foresight of, their consequences
upon the general welfare of the society; yet they have given
occasion to very different theories of political economy; of
which some magnify the importance of that industry which is
carried on in towns, others of that which is carried on in the
country. Those theories have had a considerable influence, not
only upon the opinions of men of learning, but upon the public
conduct of princes and sovereign states. I have endeavoured, in
the fourth book, to explain, as fully and distinctly as I can,
those different theories, and the principal effects which they
have produced in different ages and nations.
     To explain in what has consisted the revenue of the great
body of the people, or what has been the nature of those funds
which, in different ages and nations, have supplied their annual
consumption, is the object of these four first books. The fifth
and last book treats of the revenue of the sovereign, or
commonwealth. In this book I have endeavoured to show, first,
what are the necessary expenses of the sovereign, or
commonwealth; which of those expenses ought to be defrayed by the
general contribution of the whole society; and which of them by
that of some particular part only, or of some particular members
of it: secondly, what are the different methods in which the
whole society may be made to contribute towards defraying the
expenses incumbent on the whole society, and what are the
principal advantages and inconveniences of each of those methods:
and, thirdly and lastly, what are the reasons and causes which
have induced almost all modern governments to mortgage some part
of this revenue, or to contract debts, and what have been the
effects of those debts upon the real wealth, the annual produce of the land and labour of the society. 

 
     THE greatest improvement in the productive powers of labour,
and the greater part of the skill, dexterity, and judgment with
which it is anywhere directed, or applied, seem to have been the
effects of the division of labour.
     The effects of the division of labour, in the general
business of society, will be more easily understood by
considering in what manner it operates in some particular
manufactures. It is commonly supposed to be carried furthest in
some very trifling ones; not perhaps that it really is carried
further in them than in others of more importance: but in those
trifling manufactures which are destined to supply the small
wants of but a small number of people, the whole number of
workmen must necessarily be small; and those employed in every
different branch of the work can often be collected into the same
workhouse, and placed at once under the view of the spectator. In
those great manufactures, on the contrary, which are destined to
supply the great wants of the great body of the people, every
different branch of the work employs so great a number of workmen
that it is impossible to collect them all into the same
workhouse. We can seldom see more, at one time, than those
employed in one single branch. Though in such manufactures,
therefore, the work may really be divided into a much greater
number of parts than in those of a more trifling nature, the
division is not near so obvious, and has accordingly been much
less observed.
     To take an example, therefore, from a very trifling
manufacture; but one in which the division of labour has been
very often taken notice of, the trade of the pin-maker; a workman
not educated to this business (which the division of labour has
rendered a distinct trade), nor acquainted with the use of the
machinery employed in it (to the invention of which the same
division of labour has probably given occasion), could scarce,
perhaps, with his utmost industry, make one pin in a day, and
certainly could not make twenty. But in the way in which this
business is now carried on, not only the whole work is a peculiar
trade, but it is divided into a number of branches, of which the
greater part are likewise peculiar trades. One man draws out the
wire, another straights it, a third cuts it, a fourth points it,
a fifth grinds it at the top for receiving, the head; to make the
head requires two or three distinct operations; to put it on is a
peculiar business, to whiten the pins is another; it is even a
trade by itself to put them into the paper; and the important
business of making a pin is, in this manner, divided into about
eighteen distinct operations, which, in some manufactories, are
all performed by distinct hands, though in others the same man
will sometimes perform two or three of them. I have seen a small
manufactory of this kind where ten men only were employed, and
where some of them consequently performed two or three distinct
operations. But though they were very poor, and therefore but
indifferently accommodated with the necessary machinery, they
could, when they exerted themselves, make among them about twelve
pounds of pins in a day. There are in a pound upwards of four
thousand pins of a middling size. Those ten persons, therefore,
could make among them upwards of forty-eight thousand pins in a
day. Each person, therefore, making a tenth part of forty-eight
thousand pins, might be considered as making four thousand eight
hundred pins in a day. But if they had all wrought separately and
independently, and without any of them having been educated to
this peculiar business, they certainly could not each of them
have made twenty, perhaps not one pin in a day; that is,
certainly, not the two hundred and fortieth, perhaps not the four
thousand eight hundredth part of what they are at present capable
of performing, in consequence of a proper division and
combination of their different operations.
     In every other art and manufacture, the effects of the
division of labour are similar to what they are in this very
trifling one; though, in many of them, the labour can neither be
so much subdivided, nor reduced to so great a simplicity of
operation. The division of labour, however, so far as it can be
introduced, occasions, in every art, a proportionable increase of
the productive powers of labour. The separation of different
trades and employments from one another seems to have taken place
in consequence of this advantage. This separation, too, is
generally called furthest in those countries which enjoy the
highest degree of industry and improvement; what is the work of
one man in a rude state of society being generally that of
several in an improved one. In every improved society, the farmer
is generally nothing but a farmer; the manufacturer, nothing but
a manufacturer. The labour, too, which is necessary to produce
any one complete manufacture is almost always divided among a
great number of hands. How many different trades are employed in
each branch of the linen and woollen manufactures from the
growers of the flax and the wool, to the bleachers and smoothers
of the linen, or to the dyers and dressers of the cloth! The
nature of agriculture, indeed, does not admit of so many
subdivisions of labour, nor of so complete a separation of one
business from another, as manufactures. It is impossible to
separate so entirely the business of the grazier from that of the
corn-farmer as the trade of the carpenter is commonly separated
from that of the smith. The spinner is almost always a distinct
person from the weaver; but the ploughman, the harrower, the
sower of the seed, and the reaper of the corn, are often the
same. The occasions for those different sorts of labour returning
with the different seasons of the year, it is impossible that one
man should be constantly employed in any one of them. This
impossibility of making so complete and entire a separation of
all the different branches of labour employed in agriculture is
perhaps the reason why the improvement of the productive powers
of labour in this art does not always keep pace with their
improvement in manufactures. The most opulent nations, indeed,
generally excel all their neighbours in agriculture as well as in
manufactures; but they are commonly more distinguished by their
superiority in the latter than in the former. Their lands are in
general better cultivated, and having more labour and expense
bestowed upon them, produce more in proportion to the extent and
natural fertility of the ground. But this superiority of produce
is seldom much more than in proportion to the superiority of
labour and expense. In agriculture, the labour of the rich
country is not always much more productive than that of the poor;
or, at least, it is never so much more productive as it commonly
is in manufactures. The corn of the rich country, therefore, will
not always, in the same degree of goodness, come cheaper to
market than that of the poor. The corn of Poland, in the same
degree of goodness, is as cheap as that of France,
notwithstanding the superior opulence and improvement of the
latter country. The corn of France is, in the corn provinces,
fully as good, and in most years nearly about the same price with
the corn of England, though, in opulence and improvement, France
is perhaps inferior to England. The corn-lands of England,
however, are better cultivated than those of France, and the
corn-lands of France are said to be much better cultivated than
those of Poland. But though the poor country, notwithstanding the
inferiority of its cultivation, can, in some measure, rival the
rich in the cheapness and goodness of its corn, it can pretend to
no such competition in its manufactures; at least if those
manufactures suit the soil, climate, and situation of the rich
country. The silks of France are better and cheaper than those of
England, because the silk manufacture, at least under the present
high duties upon the importation of raw silk, does not so well
suit the climate of England as that of France. But the hardware
and the coarse woollens of England are beyond all comparison
superior to those of France, and much cheaper too in the same
degree of goodness. In Poland there are said to be scarce any
manufactures of any kind, a few of those coarser household
manufactures excepted, without which no country can well subsist.
     This great increase of the quantity of work which, in
consequence of the division of labour, the same number of people
are capable of performing, is owing to three different
circumstances; first, to the increase of dexterity in every
particular workman; secondly, to the saving of the time which is
commonly lost in passing from one species of work to another; and
lastly, to the invention of a great number of machines which
facilitate and abridge labour, and enable one man to do the work
of many.
     First, the improvement of the dexterity of the workman
necessarily increases the quantity of the work he can perform;
and the division of labour, by reducing every man's business to
some one simple operation, and by making this operation the sole
employment of his life, necessarily increased very much dexterity
of the workman. A common smith, who, though accustomed to handle
the hammer, has never been used to make nails, if upon some
particular occasion he is obliged to attempt it, will scarce, I
am assured, be able to make above two or three hundred nails in a
day, and those too very bad ones. A smith who has been accustomed
to make nails, but whose sole or principal business has not been
that of a nailer, can seldom with his utmost diligence make more
than eight hundred or a thousand nails in a day. I have seen
several boys under twenty years of age who had never exercised
any other trade but that of making nails, and who, when they
exerted themselves, could make, each of them, upwards of two
thousand three hundred nails in a day. The making of a nail,
however, is by no means one of the simplest operations. The same
person blows the bellows, stirs or mends the fire as there is
occasion, heats the iron, and forges every part of the nail: in
forging the head too he is obliged to change his tools. The
different operations into which the making of a pin, or of a
metal button, is subdivided, are all of them much more simple,
and the dexterity of the person, of whose life it has been the
sole business to perform them, is usually much greater. The
rapidity with which some of the operations of those manufacturers
are performed, exceeds what the human hand could, by those who
had never seen them, be supposed capable of acquiring.
     Secondly, the advantage which is gained by saving the time
commonly lost in passing from one sort of work to another is much
greater than we should at first view be apt to imagine it. It is
impossible to pass very quickly from one kind of work to another
that is carried on in a different place and with quite different
tools. A country weaver, who cultivates a small farm, must lose a
good deal of time in passing from his loom to the field, and from
the field to his loom. When the two trades can be carried on in
the same workhouse, the loss of time is no doubt much less. It is
even in this case, however, very considerable. A man commonly
saunters a little in turning his hand from one sort of employment
to another. When he first begins the new work he is seldom very
keen and hearty; his mind, as they say, does not go to it, and
for some time he rather trifles than applies to good purpose. The
habit of sauntering and of indolent careless application, which
is naturally, or rather necessarily acquired by every country
workman who is obliged to change his work and his tools every
half hour, and to apply his hand in twenty different ways almost
every day of his life, renders him almost always slothful and
lazy, and incapable of any vigorous application even on the most
pressing occasions. Independent, therefore, of his deficiency in
point of dexterity, this cause alone must always reduce
considerably the quantity of work which he is capable of
performing.
     Thirdly, and lastly, everybody must be sensible how much
labour is facilitated and abridged by the application of proper
machinery. It is unnecessary to give any example. I shall only
observe, therefore, that the invention of all those machines by
which labour is so much facilitated and abridged seems to have
been originally owing to the division of labour. Men are much
more likely to discover easier and readier methods of attaining
any object when the whole attention of their minds is directed
towards that single object than when it is dissipated among a
great variety of things. But in consequence of the division of
labour, the whole of every man's attention comes naturally to be
directed towards some one very simple object. It is naturally to
be expected, therefore, that some one or other of those who are
employed in each particular branch of labour should soon find out
easier and readier methods of performing their own particular
work, wherever the nature of it admits of such improvement. A
great part of the machines made use of in those manufactures in
which labour is most subdivided, were originally the inventions
of common workmen, who, being each of them employed in some very
simple operation, naturally turned their thoughts towards finding
out easier and readier methods of performing it. Whoever has been
much accustomed to visit such manufactures must frequently have
been shown very pretty machines, which were the inventions of
such workmen in order to facilitate and quicken their particular
part of the work. In the first fire-engines, a boy was constantly
employed to open and shut alternately the communication between
the boiler and the cylinder, according as the piston either
ascended or descended. One of those boys, who loved to play with
his companions, observed that, by tying a string from the handle
of the valve which opened this communication to another part of
the machine, the valve would open and shut without his
assistance, and leave him at liberty to divert himself with his
playfellows. One of the greatest improvements that has been made
upon this machine, since it was first invented, was in this
manner the discovery of a boy who wanted to save his own labour.
     All the improvements in machinery, however, have by no means
been the inventions of those who had occasion to use the
machines. Many improvements have been made by the ingenuity of
the makers of the machines, when to make them became the business
of a peculiar trade; and some by that of those who are called
philosophers or men of speculation, whose trade it is not to do
anything, but to observe everything; and who, upon that account,
are often capable of combining together the powers of the most
distant and dissimilar objects. In the progress of society,
philosophy or speculation becomes, like every other employment,
the principal or sole trade and occupation of a particular class
of citizens. Like every other employment too, it is subdivided
into a great number of different branches, each of which affords
occupation to a peculiar tribe or class of philosophers; and this
subdivision of employment in philosophy, as well as in every
other business, improves dexterity, and saves time. Each
individual becomes more expert in his own peculiar branch, more
work is done upon the whole, and the quantity of science is
considerably increased by it.
     It is the great multiplication of the productions of all the
different arts, in consequence of the division of labour, which
occasions, in a well-governed society, that universal opulence
which extends itself to the lowest ranks of the people. Every
workman has a great quantity of his own work to dispose of beyond
what he himself has occasion for; and every other workman being
exactly in the same situation, he is enabled to exchange a great
quantity of his own goods for a great quantity, or, what comes to
the same thing, for the price of a great quantity of theirs. He
supplies them abundantly with what they have occasion for, and
they accommodate him as amply with what he has occasion for, and
a general plenty diffuses itself through all the different ranks
of the society.
     Observe the accommodation of the most common artificer or
day-labourer in a civilised and thriving country, and you will
perceive that the number of people of whose industry a part,
though but a small part, has been employed in procuring him this
accommodation, exceeds all computation. The woollen coat, for
example, which covers the day-labourer, as coarse and rough as it
may appear, is the produce of the joint labour of a great
multitude of workmen. The shepherd, the sorter of the wool, the
wool-comber or carder, the dyer, the scribbler, the spinner, the
weaver, the fuller, the dresser, with many others, must all join
their different arts in order to complete even this homely
production. How many merchants and carriers, besides, must have
been employed in transporting the materials from some of those
workmen to others who often live in a very distant part of the
country! How much commerce and navigation in particular, how many
ship-builders, sailors, sail-makers, rope-makers, must have been
employed in order to bring together the different drugs made use
of by the dyer, which often come from the remotest corners of the
world! What a variety of labour, too, is necessary in order to
produce the tools of the meanest of those workmen! To say nothing
of such complicated machines as the ship of the sailor, the mill
of the fuller, or even the loom of the weaver, let us consider
only what a variety of labour is requisite in order to form that
very simple machine, the shears with which the shepherd clips the
wool. The miner, the builder of the furnace for smelting the ore,
the seller of the timber, the burner of the charcoal to be made
use of in the smelting-house, the brickmaker, the brick-layer,
the workmen who attend the furnace, the mill-wright, the forger,
the smith, must all of them join their different arts in order to
produce them. Were we to examine, in the same manner, all the
different parts of his dress and household furniture, the coarse
linen shirt which he wears next his skin, the shoes which cover
his feet, the bed which he lies on, and all the different parts
which compose it, the kitchen-grate at which he prepares his
victuals, the coals which he makes use of for that purpose, dug
from the bowels of the earth, and brought to him perhaps by a
long sea and a long land carriage, all the other utensils of his
kitchen, all the furniture of his table, the knives and forks,
the earthen or pewter plates upon which he serves up and divides
his victuals, the different hands employed in preparing his bread
and his beer, the glass window which lets in the heat and the
light, and keeps out the wind and the rain, with all the
knowledge and art requisite for preparing that beautiful and
happy invention, without which these northern parts of the world
could scarce have afforded a very comfortable habitation,
together with the tools of all the different workmen employed in
producing those different conveniences; if we examine, I say, all
these things, and consider what a variety of labour is employed
about each of them, we shall be sensible that, without the
assistance and co-operation of many thousands, the very meanest
person in a civilised country could not be provided, even
according to what we very falsely imagine the easy and simple
manner in which he is commonly accommodated. Compared, indeed,
with the more extravagant luxury of the great, his accommodation
must no doubt appear extremely simple and easy; and yet it may be
true, perhaps, that the accommodation of a European prince does
not always so much exceed that of an industrious and frugal
peasant as the accommodation of the latter exceeds that of many
an African king, the absolute master of the lives and liberties
of ten thousand naked savages.

 
     THIS division of labour, from which so many advantages are
derived, is not originally the effect of any human wisdom, which
foresees and intends that general opulence to which it gives
occasion. It is the necessary, though very slow and gradual
consequence of a certain propensity in human nature which has in
view no such extensive utility; the propensity to truck, barter,
and exchange one thing for another.
     Whether this propensity be one of those original principles
in human nature of which no further account can be given; or
whether, as seems more probable, it be the necessary consequence
of the faculties of reason and speech, it belongs not to our
present subject to inquire. It is common to all men, and to be
found in no other race of animals, which seem to know neither
this nor any other species of contracts. Two greyhounds, in
running down the same hare, have sometimes the appearance of
acting in some sort of concert. Each turns her towards his
companion, or endeavours to intercept her when his companion
turns her towards himself. This, however, is not the effect of
any contract, but of the accidental concurrence of their passions
in the same object at that particular time. Nobody ever saw a dog
make a fair and deliberate exchange of one bone for another with
another dog. Nobody ever saw one animal by its gestures and
natural cries signify to another, this is mine, that yours; I am
willing to give this for that. When an animal wants to obtain
something either of a man or of another animal, it has no other
means of persuasion but to gain the favour of those whose service
it requires. A puppy fawns upon its dam, and a spaniel endeavours
by a thousand attractions to engage the attention of its master
who is at dinner, when it wants to be fed by him. Man sometimes
uses the same arts with his brethren, and when he has no other
means of engaging them to act according to his inclinations,
endeavours by every servile and fawning attention to obtain their
good will. He has not time, however, to do this upon every
occasion. In civilised society he stands at all times in need of
the cooperation and assistance of great multitudes, while his
whole life is scarce sufficient to gain the friendship of a few
persons. In almost every other race of animals each individual,
when it is grown up to maturity, is entirely independent, and in
its natural state has occasion for the assistance of no other
living creature. But man has almost constant occasion for the
help of his brethren, and it is in vain for him to expect it from
their benevolence only. He will be more likely to prevail if he
can interest their self-love in his favour, and show them that it
is for their own advantage to do for him what he requires of
them. Whoever offers to another a bargain of any kind, proposes
to do this. Give me that which I want, and you shall have this
which you want, is the meaning of every such offer; and it is in
this manner that we obtain from one another the far greater part
of those good offices which we stand in need of. It is not from
the benevolence of the butcher, the brewer, or the baker that we
expect our dinner, but from their regard to their own interest.
We address ourselves, not to their humanity but to their
self-love, and never talk to them of our own necessities but of
their advantages. Nobody but a beggar chooses to depend chiefly
upon the benevolence of his fellow-citizens. Even a beggar does
not depend upon it entirely. The charity of well-disposed people,
indeed, supplies him with the whole fund of his subsistence. But
though this principle ultimately provides him with all the
necessaries of life which he has occasion for, it neither does
nor can provide him with them as he has occasion for them. The
greater part of his occasional wants are supplied in the same
manner as those of other people, by treaty, by barter, and by
purchase. With the money which one man gives him he purchases
food. The old clothes which another bestows upon him he exchanges
for other old clothes which suit him better, or for lodging, or
for food, or for money, with which he can buy either food,
clothes, or lodging, as he has occasion.
     As it is by treaty, by barter, and by purchase that we
obtain from one another the greater part of those mutual good
offices which we stand in need of, so it is this same trucking
disposition which originally gives occasion to the division of
labour. In a tribe of hunters or shepherds a particular person
makes bows and arrows, for example, with more readiness and
dexterity than any other. He frequently exchanges them for cattle
or for venison with his companions; and he finds at last that he
can in this manner get more cattle and venison than if he himself
went to the field to catch them. From a regard to his own
interest, therefore, the making of bows and arrows grows to be
his chief business, and he becomes a sort of armourer. Another
excels in making the frames and covers of their little huts or
movable houses. He is accustomed to be of use in this way to his
neighbours, who reward him in the same manner with cattle and
with venison, till at last he finds it his interest to dedicate
himself entirely to this employment, and to become a sort of
house-carpenter. In the same manner a third becomes a smith or a
brazier, a fourth a tanner or dresser of hides or skins, the
principal part of the nothing of savages. And thus the certainty
of being able to exchange all that surplus part of the produce of
his own labour, which is over and above his own consumption, for
such parts of the produce of other men's labour as he may have
occasion for, encourages every man to apply himself to a
particular occupation, and to cultivate and bring to perfection
whatever talent or genius he may possess for that particular
species of business.
     The difference of natural talents in different men is, in
reality, much less than we are aware of; and the very different
genius which appears to distinguish men of different professions,
when grown up to maturity, is not upon many occasions so much the
cause as the effect of the division of labour. The difference
between the most dissimilar characters, between a philosopher and
a common street porter, for example, seems to arise not so much
from nature as from habit, custom, and education. When they came
into the world, and for the first six or eight years of their
existence, they were perhaps very much alike, and neither their
parents nor playfellows could perceive any remarkable difference.
About that age, or soon after, they come to be employed in very
different occupations. The difference of talents comes then to be
taken notice of, and widens by degrees, till at last the vanity
of the philosopher is willing to acknowledge scarce any
resemblance. But without the disposition to truck, barter, and
exchange, every man must have procured to himself every necessary
and conveniency of life which he wanted. All must have had the
same duties to perform, and the same work to do, and there could
have been no such difference of employment as could alone give
occasion to any great difference of talents.
     As it is this disposition which forms that difference of
talents, so remarkable among men of different professions, so it
is this same disposition which renders that difference useful.
Many tribes of animals acknowledged to be all of the same species
derive from nature a much more remarkable distinction of genius,
than what, antecedent to custom and education, appears to take
place among men. By nature a philosopher is not in genius and
disposition half so different from a street porter, as a mastiff
is from a greyhound, or a greyhound from a spaniel, or this last
from a shepherd's dog. Those different tribes of animals,
however, though all of the same species, are of scarce any use to
one another. The strength of the mastiff is not, in the least,
supported either by the swiftness of the greyhound, or by the
sagacity of the spaniel, or by the docility of the shepherd's
dog. The effects of those different geniuses and talents, for
want of the power or disposition to barter and exchange, cannot
be brought into a common stock, and do not in the least
contribute to the better accommodation ind conveniency of the
species. Each animal is still obliged to support and defend
itself, separately and independently, and derives no sort of
advantage from that variety of talents with which nature has
distinguished its fellows. Among men, on the contrary, the most
dissimilar geniuses are of use to one another; the different
produces of their respective talents, by the general disposition
to truck, barter, and exchange, being brought, as it were, into a
common stock, where every man may purchase whatever part of the
produce of other men's talents he has occasion for. 

 
     AS it is the power of exchanging that gives occasion to the
division of labour, so the extent of this division must always be
limited by the extent of that power, or, in other words, by the
extent of the market. When the market is very small, no person
can have any encouragement to dedicate himself entirely to one
employment, for want of the power to exchange all that surplus
part of the produce of his own labour, which is over and above
his own consumption, for such parts of the produce of other men's
labour as he has occasion for.
     There are some sorts of industry, even of the lowest kind,
which can be carried on nowhere but in a great town. A porter,
for example, can find employment and subsistence in no other
place. A village is by much too narrow a sphere for him; even an
ordinary market town is scarce large enough to afford him
constant occupation. In the lone houses and very small villages
which are scattered about in so desert a country as the Highlands
of Scotland, every farmer must be butcher, baker and brewer for
his own family. In such situations we can scarce expect to find
even a smith, a carpenter, or a mason, within less than twenty
miles of another of the same trade. The scattered families that
live at eight or ten miles distance from the nearest of them must
learn to perform themselves a great number of little pieces of
work, for which, in more populous countries, they would call in
the assistance of those workmen. Country workmen are almost
everywhere obliged to apply themselves to all the different
branches of industry that have so much affinity to one another as
to be employed about the same sort of materials. A country
carpenter deals in every sort of work that is made of wood: a
country smith in every sort of work that is made of iron. The
former is not only a carpenter, but a joiner, a cabinet-maker,
and even a carver in wood, as well as a wheel-wright, a
plough-wright, a cart and waggon maker. The employments of the
latter are still more various. It is impossible there should be
such a trade as even that of a nailer in the remote and inland
parts of the Highlands of Scotland. Such a workman at the rate of
a thousand nails a day, and three hundred working days in the
year, will make three hundred thousand nails in the year. But in
such a situation it would be impossible to dispose of one
thousand, that is, of one day's work in the year.
     As by means of water-carriage a more extensive market is
opened to every sort of industry than what land-carriage alone
can afford it, so it is upon the sea-coast, and along the banks
of navigable rivers, that industry of every kind naturally begins
to subdivide and improve itself, and it is frequently not till a
long time after that those improvements extend themselves to the
inland parts of the country. A broad-wheeled waggon, attended by
two men, and drawn by eight horses, in about six weeks' time
carries and brings back between London and Edinburgh near four
ton weight of goods. In about the same time a ship navigated by
six or eight men, and sailing between the ports of London and
Leith, frequently carries and brings back two hundred ton weight
of goods. Six or eight men, therefore, by the help of
water-carriage, can carry and bring back in the same time the
same quantity of goods between London and Edinburgh, as fifty
broad-wheeled waggons, attended by a hundred men, and drawn by
four hundred horses. Upon two hundred tons of goods, therefore,
carried by the cheapest land-carriage from London to Edinburgh,
there must be charged the maintenance of a hundred men for three
weeks, and both the maintenance, and, what is nearly equal to the
maintenance, the wear and tear of four hundred horses as well as
of fifty great waggons. Whereas, upon the same quantity of goods
carried by water, there is to be charged only the maintenance of
six or eight men, and the wear and tear of a ship of two hundred
tons burden, together with the value of the superior risk, or the
difference of the insurance between land and water-carriage. Were
there no other communication between those two places, therefore,
but by land-carriage, as no goods could be transported from the
one to the other, except such whose price was very considerable
in proportion to their weight, they could carry on but a small
part of that commerce which at present subsists between them, and
consequently could give but a small part of that encouragement
which they at present mutually afford to each other's industry.
There could be little or no commerce of any kind between the
distant parts of the world. What goods could bear the expense of
land-carriage between London and Calcutta? Or if there were any
so precious as to be able to support this expense, with what
safety could they be transported through the territories of so
many barbarous nations? Those two cities, however, at present
carry on a very considerable commerce with each other, and by
mutually affording a market, give a good deal of encouragement to
each other's industry.
     Since such, therefore, are the advantages of water-carriage,
it is natural that the first improvements of art and industry
should be made where this conveniency opens the whole world for a
market to the produce of every sort of labour, and that they
should always be much later in extending themselves into the
inland parts of the country. The inland parts of the country can
for a long time have no other market for the greater part of
their goods, but the country which lies round about them, and
separates them from the sea-coast, and the great navigable
rivers. The extent of their market, therefore, must for a long
time be in proportion to the riches and populousness of that
country, and consequently their improvement must always be
posterior to the improvement of that country. In our North
American colonies the plantations have constantly followed either
the sea-coast or the banks of the navigable rivers, and have
scarce anywhere extended themselves to any considerable distance
from both.
     The nations that, according to the best authenticated
history, appear to have been first civilised, were those that
dwelt round the coast of the Mediterranean Sea. That sea, by far
the greatest inlet that is known in the world, having no tides,
nor consequently any waves except such as are caused by the wind
only, was, by the smoothness of its surface, as well as by the
multitude of its islands, and the proximity of its neighbouring
shores, extremely favourable to the infant navigation of the
world; when, from their ignorance of the compass, men were afraid
to quit the view of the coast, and from the imperfection of the
art of shipbuilding, to abandon themselves to the boisterous
waves of the ocean. To pass beyond the pillars of Hercules, that
is, to sail out of the Straits of Gibraltar, was, in the ancient
world, long considered as a most wonderful and dangerous exploit
of navigation. It was late before even the Phoenicians and
Carthaginians, the most skilful navigators and ship-builders of
those old times, attempted it, and they were for a long time the
only nations that did attempt it.
     Of all the countries on the coast of the Mediterranean Sea,
Egypt seems to have been the first in which either agriculture or
manufactures were cultivated and improved to any considerable
degree. Upper Egypt extends itself nowhere above a few miles from
the Nile, and in Lower Egypt that great river breaks itself into
many different canals, which, with the assistance of a little
art, seem to have afforded a communication by water-carriage, not
only between all the great towns, but between all the
considerable villages, and even to many farmhouses in the
country; nearly in the same manner as the Rhine and the Maas do
in Holland at present. The extent and easiness of this inland
navigation was probably one of the principal causes of the early
improvement of Egypt.
     The improvements in agriculture and manufactures seem
likewise to have been of very great antiquity in the provinces of
Bengal, in the East Indies, and in some of the eastern provinces
of China; though the great extent of this antiquity is not
authenticated by any histories of whose authority we, in this
part of the world, are well assured. In Bengal the Ganges and
several other great rivers form a great number of navigable
canals in the same manner as the Nile does in Egypt. In the
Eastern provinces of China too, several great rivers form, by
their different branches, a multitude of canals, and by
communicating with one another afford an inland navigation much
more extensive than that either of the Nile or the Ganges, or
perhaps than both of them put together. It is remarkable that
neither the ancient Egyptians, nor the Indians, nor the Chinese,
encouraged foreign commerce, but seem all to have derived their
great opulence from this inland navigation.
     All the inland parts of Africa, and all that part of Asia
which lies any considerable way north of the Euxine and Caspian
seas, the ancient Scythia, the modern Tartary and Siberia, seem
in all ages of the world to have been in the same barbarous and
uncivilised state in which we find them at present. The Sea of
Tartary is the frozen ocean which admits of no navigation, and
though some of the greatest rivers in the world run through that
country, they are at too great a distance from one another to
carry commerce and communication through the greater part of it.
There are in Africa none of those great inlets, such as the
Baltic and Adriatic seas in Europe, the Mediterranean and Euxine
seas in both Europe and Asia, and the gulfs of Arabia, Persia,
India, Bengal, and Siam, in Asia, to carry maritime commerce into
the interior parts of that great continent: and the great rivers
of Africa are at too great a distance from one another to give
occasion to any considerable inland navigation. The commerce
besides which any nation can carry on by means of a river which
does not break itself into any great number of branches or
canals, and which runs into another territory before it reaches
the sea, can never be very considerable; because it is always in
the power of the nations who possess that other territory to
obstruct the communication between the upper country and the sea.
The navigation of the Danube is of very little use to the
different states of Bavaria, Austria and Hungary, in comparison
of what it would be if any of them possessed the whole of its
course till it falls into the Black Sea. 

 
    1. That a thing may have any value in exchange, two
conditions are necessary. It must be of some use; that is (as
already explained) it must conduce to some purpose, satisfy some
desire. No one will pay a price, or part with anything which
serves some of his purposes, to obtain a thing which serves none
of them. But, secondly, the thing must not only have some
utility, there must also be some difficulty in its attainment.
"Any article whatever," says Mr De Quincey,(1*) "to obtain that
artificial sort of value which is meant by exchange value, must
begin by offering itself as a means to some desirable purpose;
and secondly, even though possessing incontestably this
preliminary advantage, it will never ascend to an exchange value
in cases where it can be obtained gratuitously and without
effort; of which last terms both are necessary as limitations.
For often it will happen that some desirable object may be
obtained gratuitously; stoop, and you gather it at your feet; but
still, because the continued iteration of this stooping exacts a
laborious effort, very soon it is found, that to gather for
yourself virtually is not gratuitous. In the vast forests of the
Canadas, at intervals, wild strawberries may be gratuitously
gathered by shiploads: yet such is the exhaustion of a stooping
posture, and of a labour so monotonous, that everybody is soon
glad to resign the service into mercenary hands."
    As was pointed out in the last chapter, the utility of a
thing in the estimation of the purchaser, is the extreme limit of
its exchange value: higher the value cannot ascend; peculiar
circumstances are required to raise it so high. This topic is
happily illustrated by Mr. De Quincey. "Walk into almost any
possible shop, buy the first article you see; what will determine
its price? In the ninety-nine cases out of a hundred, simply the
element D -- difficulty of attainment. The other element U, or
intrinsic utility, will be perfectly inoperative. Let the thing
(measured by its uses) be, for your Purposes, worth ten guineas,
so that you would rather give ten guineas than lose it; yet, if
the difficulty of producing it be only worth one guinea, one
guinea is the price which it will bear. But still not the less,
though U is inoperative, can U be supposed absent? By no
possibility; for, if it had been absent, assuredly you would not
have bought the article even at the lowest price. U acts upon
you, though it does not act upon the price. On the other hand, in
the hundredth case, we will suppose the circumstances reversed:
you are on Lake Superior in a steam-boat, making your way to an
unsettled region 800 miles a-head of civilization, and
consciously with no chance at all of purchasing any luxury
whatsoever, little luxury or big luxury, for the space of ten
years to come. One fellow-passenger, whom you will part with
before sunset, has a powerful musical snuff-box; knowing by
experience the power of such a toy over your own feelings, the
magic with which at times it lulls your agitations of mind, you
are vehemently desirous to purchase it. In the hour of leaving
London you had forgot to do so; here is a final chance. But the
owner, aware of your situation not less than yourself, is
determined to operate by a strain pushed to the very uttermost
upon U, upon the intrinsic worth of the article in your
individual estimate for your individual purposes. He will not
hear of D as any controlling power or mitigating agency in the
case; and finally, although at six guineas a-piece in London or
Paris you might have loaded a waggon with such boxes, you pay
sixty rather than lose it when the last knell of the clock has
sounded, which summons you to buy now or to forfeit for ever.
Here, as before, only one element is operative; before it was D,
now it is U. But after all, D was not absent, though inoperative.
The inertness of D allowed U to put forth its total effect. The
practical compression of D being withdrawn, U springs up like
water in a pump when released from the pressure of air. Yet still
that D was present to your thoughts, though the price was
otherwise regulated, is evident; both because U and D must
coexist in order to found any case of exchange value whatever,
and because undeniably you take into very particular
consideration this D, the extreme difficulty of attainment (which
here is the greatest possible, viz. an impossibility) before you
consent to have the price racked up to U. The special D has
vanished; but it is replaced in your thoughts by an unlimited D.
Undoubtedly you have submitted to U in extremity as the
regulating force of the price; but it was under a sense of D's
latent presence. Yet D is so far from exerting any positive
force, that the retirement of D from all agency whatever on the
price-this it is which creates as it were a perfect vacuum, and
through that vacuum U rushes up to its highest and ultimate
gradation." 
    This case, in which the value is wholly related by the
necessities or desires of the purchaser, is the case of strict
and absolute monopoly; in which, the article desired being only
obtainable from one person, he can exact any equivalent, short of
the point at which no purchaser could be found. But it is not a
necessary consequence, even of complete monopoly, that the value
should be forced up to this ultimate limit; as will be seen when
we have considered the law of value in so far as depending on the
other element, difficulty of attainment. 

    2. The difficulty of attainment which determines value, is
not always the same kind of difficulty. It sometimes consists in
an absolute limitation of the supply. There are things of which
it is physically impossible to increase the quantity beyond
certain narrow limits. Such are those wines which can be grown
only in peculiar circumstances of soil, climate, and exposure.
Such also are ancient sculptures; pictures by old masters; rare
books or coins, or other articles of antiquarian curiosity. Among
such may also be reckoned houses and building-ground, in a town
of definite extent (such as Venice, or any fortified town where
fortifications are necessary to security); the most desirable
sites in any town whatever; houses and parks peculiarly favoured
by natural beauty, in places where that advantage is uncommon.
Potentially, all land whatever is a commodity of this class; and
might be practically so, in countries fully occupied and
cultivated. 
    But there is another category (embracing the majority of all
things that are bought and sold), in which the obstacle to
attainment consists only in the labour and expense requisite to
produce the commodity. Without a certain labour and expense it
cannot be had: but when any one is willing to incur these, there
needs be no limit to the multiplication of the product. If there
were labourers enough and machinery enough, cottons, woollens, or
linens might be produced by thousands of yards for every single
yard now manufactured. There would be a point, no doubt, where
further increase would be stopped by the incapacity of the earth
to afford more of the material. But there is no need, for any
purpose of political economy, to contemplate a time when this
ideal limit could become a practical one. 
    There is a third case, intermediate between the two
preceding, and rather more complex, which I shall at present
merely indicate, but the importance of which in political economy
is extremely great. There are commodities which can be multiplied
to an indefinite extent by labour and expenditure, but not by a
fixed amount of labour and expenditure. Only a limited quantity
can be produced at a given cost: if more is wanted, it must be
produced at a greater cost. To this class, as has been often
repeated, agricultural produce belongs; and generally all the
rude produce of the earth; and this peculiarity is a source of
very important consequences; one of which is the necessity of a
limit to population; and another, the payment of rent.

    3. These being the three classes, in one or other of which
all things that are bought and sold must take their place, we
shall consider them in their order. And first, of things
absolutely limited in quantity, such as ancient sculptures or
pictures.
    Of such things it is commonly said, that their value depends
upon their scarcity: but the expression is not sufficiently
definite to serve our purpose. Others say, with somewhat greater
precision, that the value depends on the demand and the supply.
But even this statement requires much explanation, to make it a
clear exponent of the relation between the value of a thing, and
the causes of which that value is an effect. 
    The supply of a commodity is an intelligible expression: it
means the quantity offered for sale; the quantity that is to be
had, at a given time and place, by those who wish to purchase it.
But what is meant by the demand? Not the mere desire for the
commodity. A beggar may desire a diamond; but his desire, however
great, will have no influence on the price. Writers have
therefore given a more limited sense to demand, and have defined
it, the wish to possess, combined with the power of purchasing.
To distinguish demand in this technical sense, from the demand
which is synonymous with desire, they call the former effectual
demand.(2*) After this explanation, it is usually supposed that
there remains no further difficulty, and that the value depends
upon the ratio between the effectual demand, as thus defined, and
the supply. 
    These phrases, however, fail to satisfy any one who requires
clear ideas, and a perfectly precise expression of them. Some
confusion must always attach to a phrase so inappropriate as that
of a ratio between two things not of the same denomination. What
ratio can there be between a quantity and a desire, or even a
desire combined with a power? A ratio between demand and supply
is only intelligible if by demand we mean the quantity demanded,
and if the ratio intended is that between the quantity demanded
and the quantity supplied. But again, the quantity demanded is
not a fixed quantity, even at the same time and place; it varies
according to the value; if the thing is cheap, there is usually a
demand for more of it than when it is dear. The demand,
therefore, partly depends on the value. But it was before laid
down that the value depends on the demand. From this
contradiction how shall we extricate ourseLves? How solve the
paradox, of two things, each depending upon the other? 
    Though the solution of these difficulties is obvious enough,
the difficulties themselves are not fanciful; and I bring them
forward thus prominently, because I am certain that they
obscurely haunt every inquirer into the subject who has not
openly faced and distinctly realized them. Undoubtedly the true
solution must have been frequently given, though I cannot call to
mind any one who had given it before myself, except the eminently
clear thinker and skilful expositor, J.B. Say. I should have
imagined, however, that it must be familiar to all political
economists, if the writings of several did not give evidence of
some want of clearness on the point, and if the instance of Mr.
De Quincey did not prove that the complete non-recognition and
implied denial of it are compatible with great intellectual
ingenuity, and close intimacy with the subject matter. 

    4. Meaning, by the word demand, the quantity demanded, and
remembering that this is not a fixed quantity, but in general
varies according to the value, let us suppose that the demand at
some particular time exceeds the supply, that is, there are
persons ready to buy, at the market value, a greater quantity
than is offered for sale. Competition takes place on the side of
the buyers, and the value rises: but how much? in the ratio (some
may suppose) of the deficiency: if the demand exceeds the supply
by one-third, the value rises one-third. By no means: for when
the value has risen one-third, the demand may still exceed the
supply; there may, even at that higher value, be a greater
quantity wanted than is to be had; and the competition of buyers
may still continue. If the article is a necessary of life, which,
rather than resign, people are willing to pay for at any price, a
deficiency of one-third may raise the price to double, triple, or
quadruple.(3*) Or, on the contrary, the competition may cease
before the value has risen in even the proportion of the
deficiency. A rise, short of one-third, may place the article
beyond the means, or beyond the inclinations, of purchasers to
the full amount. At what point, then, will the rise be arrested?
At the point, whatever it be, which equalizes the demand and the
supply: at the price which cuts off the extra third from the
demand, or brings forward additional sellers sufficient to supply
it. When, in either of these ways, or by a combination of both,
the demand becomes equal and no more than equal to the supply,
the rise of value will stop. 
    The converse case is equally simple. instead of a demand
beyond the supply, let us suppose a supply exceeding the demand.
The competition will now be on the side of the sellers: the extra
quantity can only find a market by calling forth an additional
demand equal to itself. This is accomplished by means of
cheapness; the value falls, and brings the article within the
reach of more numerous customers, or induces those who were
already consumers to make increased purchases. The fall of value
required to re-establish equality, is different in different
cases. The kinds of things in which it is commonly greatest are
at the two extremities of the scale; absolute necessaries, or
those peculiar luxuries, the taste for which is confined to a
small class. In the case of food, as those who have already
enough do not require more on account of its cheapness, but
rather expend in other things what they save in food, the
increased consumption occasioned by cheapness, carries off, as
experience shows, only a small part of the extra supply caused by
an abundant harvest;(4*) and the fall is practically arrested
only when the farmers withdraw their corn, and hold it back in
hopes of a higher price; or by the operations of speculators who
buy corn when it is cheap, and store it up to be brought out when
more urgently wanted. Whether the demand and supply are equalized
by an increased demand, the result of cheapness, or by
withdrawing a part of the supply, equalized they are in either
case. 
    Thus we see that the idea of a ratio, as between demand and
supply, is out of place, and has no concern in the matter: the
proper mathematical analogy is that of an equation. Demand and
supply, the quantity demanded and the quantity supplied, will be
made equal. if unequal at any moment, competition equalizes them,
and the manner in which this is done is by an adjustment of the
value. If the demand increases, the value rises; if the demand
diminishes, the value falls: again, if the supply falls off, the
value rises; and falls if the supply is increased. The rise or
the fall continues until the demand and supply are again equal to
one another.. and the value which a commodity will bring in any
market, is no other than the value which, in that market, gives a
demand just sufficient to carry off the existing or expected
supply. 
    This, then, is the Law of Value, with respect to all
commodities not susceptible of being multiplied at pleasure. Such
commodities, no doubt, are exceptions. There is another law for
that much larger class of things, which admit of indefinite
multiplication. But it is not the less necessary to conceive
distinctly and grasp firmly the theory of this exceptional case.
In the first place, it will be found to be of great assistance in
rendering the more common case intelligible. And in the next
place, the principle of the exception stretches wider, and
embraces more cases, than might at first be supposed. 

    5. There are but few commodities which are naturally and
necessarily limited in supply. But any commodity whatever may be
artificially so. Any commodity may be the subject of a monopoly:
like tea, in this country, up to 1834; tobacco in France, opium
in British India, at present. The price of a monopolized
commodity is commonly supposed to be arbitrary; depending on the
will of the monopolist, and limited only (as in Mr. De Quincey's
case of the musical box in the wilds of America) by the buyer's
extreme estimate of its worth to himself. This is in one sense
true, but forms no exception, nevertheless, to the dependence of
the value on supply and demand. The monopolist can fix the value
as high as he pleases, short of what the consumer either could
not or would not pay'. but he can only do so by limiting the
supply. The Dutch East India Company obtained a monopoly price
for the produce of the Spice Islands, but to do so they were
obliged, in good seasons, to destroy a portion of the crop. Had
they persisted in selling all that they produced, they must have
forced a market by reducing the price, so low, perhaps, that they
would have received for the larger quantity a less total return
than for the smaller: at least they showed that such was their
opinion by destroying the surplus. Even on Lake Superior, Mr. De
Quincey's huckster could not have sold his box for sixty guineas,
if he had possessed two musical boxes and desired to sell them
both. Supposing the cost price of each to be six guineas, he
would have taken seventy for the two in preference to sixty for
one; that is, although his monopoly was the closest possible, he
would have sold the boxes at thirty-five guineas each,
notwithstanding that sixty was not beyond the buyer's estimate of
the article for his purposes. Monopoly value, therefore, does not
depend on any peculiar principle, but is a mere variety of the
ordinary case of demand and supply. 
    Again, though there are few commodities which are at all
times and for ever unsusceptible of increase of supply, any
commodity whatever may be temporarily so; and with some
commodities this is habitually the case. Agricultural produce,
for example, cannot be increased in quantity before the next
harvest; the quantity of corn already existing in the world, is
all that can be had for sometimes a year to come. During that
interval, corn is practically assimilated to things Of which the
quantity cannot be increased. In the case of most commodities, it
requires a certain time to increase their quantity; and if the
demand increases, then until a corresponding supply can he
brought forward, that is, until the supply can accommodate itself
to the demand, the value will so rise as to accommodate the
demand to the supply. 
    There is another case, the exact converse of this. There are
some articles of which the supply may be indefinitely increased,
but cannot be rapidly diminished. There are things so durable
that the quantity in existence is at all times very great in
comparison with the annual produce. Gold, and the more durable
metals, are things of this sort; and also houses. The supply of
such things might be at once diminished by destroying them; but
to do this could only be the interest of the possessor if he had
a monopoly of the article, and could repay himself for the
destruction of a part by the increased value of the remainder.
The value, therefore, of such things may continue for a long time
so low, either from excess of supply or falling off in the
demand, as to put a complete stop to further production; the
diminution of supply by wearing out being so slow a process, that
a long time is requisite, even under a total suspension of
production, to restore the original value. During that interval
the value will be regulated solely by supply and demand, and will
rise very gradually as the existing stock wears out, until there
is again a remunerating value, and production resumes its course.

    Finally, there are commodities of which, though capable of
being increased or diminished to a great, and even an unlimited
extent, the value never depends upon anything but demand and
supply. This is the case, in particular, with the commodity
Labour; of the value of which we have treated copiously in the
preceding Book: and there are many cases besides, in which we
shall find it necessary to call in this principle to solve
difficult questions of exchange value. This will be particularly
exemplified when we treat of International Values; that is, of
the terms of interchange between things produced in different
countries, or, to speak more generally, in distant places. But
into these questions we cannot enter, until we shall have
examined the case of commodities which can be increased in
quantity indefinitely and at pleasure; and shall have determined
by what law, other than that of Demand and Supply, the permanent
or average values of such commodities are regulated. This we
shall do in the next chapter. 

NOTES:

1. Logic of Political Economy, p. 13.

2. Adam Smith, who introduced the expression "effectual demand",
employed it to denote the demand of those who are willing and
able to give for the commodity what he calls its natural price,
that is, the price which will enable it to be permanently
produced and brought to market. -- See his chapter on Natural and
Market Price (book i. ch. 7)

3. "The price of corn in this country has risen from 100 to 200
per cent and upwards, when the utmost computed deficiency of the
crops has not been more than between one-sixth and one-third
below an average, and when that deficiency has been relieved by
foreign supplies. If there should be a deficiency of the crops
amounting to one-third, without any surplus from a former year,
and without any chance of relief by importation, the price might
rise five, six, or even tenfold." -- Tooke's History of Prices,
vol. i. pp. 13-5.

4. See Tooke, and the Report of the Agricultural Committee of
1821.

 
     In what has been said of the evolution of the vicarious
leisure class and its differentiation from the general body of
the working classes, reference has been made to a further
division of labour, -- that between the different servant
classes. One portion of the servant class, chiefly those persons
whose occupation is vicarious leisure, come to undertake a new,
subsidiary range of duties -- the vicarious consumption of goods.
The most obvious form in which this consumption occurs is seen in
the wearing of liveries and the occupation of spacious servants'
quarters. Another, scarcely less obtrusive or less effective form
of vicarious consumption, and a much more widely prevalent one,
is the consumption of food, clothing, dwelling, and furniture by
the lady and the rest of the domestic establishment.
     But already at a point in economic evolution far antedating
the emergence of the lady, specialised consumption of goods as an
evidence of pecuniary strength had begun to work out in a more or
less elaborate system. The beginning of a differentiation in
consumption even antedates the appearance of anything that can
fairly be called pecuniary strength. It is traceable back to the
initial phase of predatory culture, and there is even a
suggestion that an incipient differentiation in this respect lies
back of the beginnings of the predatory life. This most primitive
differentiation in the consumption of goods is like the later
differentiation with which we are all so intimately familiar, in
that it is largely of a ceremonial character, but unlike the
latter it does not rest on a difference in accumulated wealth.
The utility of consumption as an evidence of wealth is to be
classed as a derivative growth. It is an adaption to a new end,
by a selective process, of a distinction previously existing and
well established in men's habits of thought.
     In the earlier phases of the predatory culture the only
economic differentiation is a broad distinction between an
honourable superior class made up of the able-bodied men on the
one side, and a base inferior class of labouring women on the
other. According to the ideal scheme of life in force at the time
it is the office of the men to consume what the women produce.
Such consumption as falls to the women is merely incidental to
their work; it is a means to their continued labour, and not a
consumption directed to their own comfort and fulness of life.
Unproductive consumption of goods is honourable, primarily as a
mark of prowess and a perquisite of human dignity; secondarily it
becomes substantially honourable to itself, especially the
consumption of the more desirable things. The consumption of
choice articles of food, and frequently also of rare articles of
adornment, becomes tabu to the women and children; and if there
is a base (servile) class of men, the tabu holds also for them.
With a further advance in culture this tabu may change into
simple custom of a more or less rigorous character; but whatever
be the theoretical basis of the distinction which is maintained,
whether it be a tabu or a larger conventionality, the features of
the conventional scheme of consumption do not change easily. When
the quasi-peaceable stage of industry is reached, with its
fundamental institution of chattel slavery, the general
principle, more or less rigorously applied, is that the base,
industrious class should consume only what may be necessary to
their subsistence. In the nature of things, luxuries and the
comforts of life belong to the leisure class. Under the tabu,
certain victuals, and more particularly certain beverages, are
strictly reserved for the use of the superior class.
     The ceremonial differentiation of the dietary is best seen
in the use of intoxicating beverages and narcotics. If these
articles of consumption are costly, they are felt to be noble and
honorific. Therefore the base classes, primarily the women,
practice an enforced continence with respect to these stimulants,
except in countries where they are obtainable at a very low cost.
From archaic times down through all the length of the patriarchal
regime it has been the office of the women to prepare and
administer these luxuries, and it has been the perquisite of the
men of gentle birth and breeding to consume them. Drunkenness and
the other pathological consequences of the free use of stimulants
therefore tend in their turn to become honorific, as being a
mark, at the second remove, of the superior status of those who
are able to afford the indulgence. Infirmities induced by
over-indulgence are among some peoples freely recognised as manly
attributes. It has even happened that the name for certain
diseased conditions of the body arising from such an origin has
passed into everyday speech as a synonym for "noble" or "gentle".
It is only at a relatively early stage of culture that the
symptoms of expensive vice are conventionally accepted as marks
of a superior status, and so tend to become virtues and command
the deference of the community; but the reputability that
attaches to certain expensive vices long retains so much of its
force as to appreciably lesson the disapprobation visited upon
the men of the wealthy or noble class for any excessive
indulgence. The same invidious distinction adds force to the
current disapproval of any indulgence of this kind on the part of
women, minors, and inferiors. This invidious traditional
distinction has not lost its force even among the more advanced
peoples of today. Where the example set by the leisure class
retains its imperative force in the regulation of the
conventionalities, it is observable that the women still in great
measure practise the same traditional continence with regard to
stimulants.
     This characterisation of the greater continence in the use
of stimulants practised by the women of the reputable classes may
seem an excessive refinement of logic at the expense of common
sense. But facts within easy reach of any one who cares to know
them go to say that the greater abstinence of women is in some
part due to an imperative conventionality; and this
conventionality is, in a general way, strongest where the
patriarchal tradition -- the tradition that the woman is a
chattel -- has retained its hold in greatest vigour. In a sense
which has been greatly qualified in scope and rigour, but which
has by no means lost its meaning even yet, this tradition says
that the woman, being a chattel, should consume only what is
necessary to her sustenance, -- except so far as her further
consumption contributes to the comfort or the good repute of her
master. The consumption of luxuries, in the true sense, is a
consumption directed to the comfort of the consumer himself, and
is, therefore, a mark of the master. Any such consumption by
others can take place only on a basis of sufferance. In
communities where the popular habits of thought have been
profoundly shaped by  the patriarchal tradition we may
accordingly look for survivals of the tabu on luxuries at least
to the extent of a conventional deprecation of their use by the
unfree and dependent class. This is more particularly true as
regards certain luxuries, the use of which by the dependent class
would detract sensibly from the comfort or pleasure of their
masters, or which are held to be of doubtful legitimacy on other
grounds. In the apprehension of the great conservative middle
class of Western civilisation the use of these various stimulants
is obnoxious to at least one, if not both, of these objections;
and it is a fact too significant to be passed over that it is
precisely among these middle classes of the Germanic culture,
with their strong surviving sense of the patriarchal proprieties,
that the women are to the greatest extent subject to a qualified
tabu on narcotics and alcoholic beverages. With many
qualifications -- with more qualifications as the patriarchal
tradition has gradually weakened -- the general rule is felt to
be right and binding that women should consume only for the
benefit of their masters. The objection of course presents itself
that expenditure on women's dress and household paraphernalia is
an obvious exception to this rule; but it will appear in the
sequel that this exception is much more obvious than substantial.
     During the earlier stages of economic development,
consumption of goods without stint, especially consumption of the
better grades of goods, -- ideally all consumption in excess of
the subsistence minimum, -- pertains normally to the leisure
class. This restriction tends to disappear, at least formally,
after the later peaceable stage has been reached, with private
ownership of goods and an industrial system based on wage labour
or on the petty household economy. But during the earlier
quasiªpeaceable stage, when so many of the traditions through
which the institution of a leisure class has affected the
economic life of later times were taking form and consistency,
this principle has had the force of a conventional law. It has
served as the norm to which consumption has tended to conform,
and any appreciable departure from it is to be regarded as an
aberrant form, sure to be eliminated sooner or later in the
further course of development.
     The quasi-peaceable gentleman of leisure, then, not only
consumes of the staff of life beyond the minimum required for
subsistence and physical efficiency, but his consumption also
undergoes a specialisation as regards the quality of the goods
consumed. He consumes freely and of the best, in food, drink,
narcotics, shelter, services, ornaments, apparel, weapons and
accoutrements, amusements, amulets, and idols or divinities. In
the process of gradual amelioration which takes place in the
articles of his consumption, the motive principle and proximate
aim of innovation is no doubt the higher efficiency of the
improved and more elaborate products for personal comfort and
well-being. But that does not remain the sole purpose of their
consumption. The canon of reputability is at hand and seizes upon
such innovations as are, according to its standard, fit to
survive. Since the consumption of these more excellent goods is
an evidence of wealth, it becomes honorific; and conversely, the
failure to consume in due quantity and quality becomes a mark of
inferiority and demerit.
     This growth of punctilious discrimination as to qualitative
excellence in eating, drinking, etc. presently affects not only
the manner of life, but also the training and intellectual
activity of the gentleman of leisure. He is no longer simply the
successful, aggressive male, -- the man of strength, resource,
and intrepidity. In order to avoid stultification he must also
cultivate his tastes, for it now becomes incumbent on him to
discriminate with some nicety between the noble and the ignoble
in consumable goods. He becomes a connoisseur in creditable
viands of various degrees of merit, in manly beverages and
trinkets, in seemly apparel and architecture, in weapons, games,
dancers, and the narcotics. This cultivation of aesthetic faculty
requires time and application, and the demands made upon the
gentleman in this direction therefore tend to change his life of
leisure into a more or less arduous application to the business
of learning how to live a life of ostensible leisure in a
becoming way. Closely related to the requirement that the
gentleman must consume freely and of the right kind of goods,
there is the requirement that he must know how to consume them in
a seemly manner. His life of leisure must be conducted in due
form. Hence arise good manners in the way pointed out in an
earlier chapter. High-bred manners and ways of living are items
of conformity to the norm of conspicuous leisure and conspicuous
consumption.
     Conspicuous consumption of valuable goods is a means of
reputability to the gentleman of leisure. As wealth accumulates
on his hands, his own unaided effort will not avail to
sufficiently put his opulence in evidence by this method. The aid
of friends and competitors is therefore brought in by resorting
to the giving of valuable presents and expensive feasts and
entertainments. Presents and feasts had probably another origin
than that of naive ostentation, but they required their utility
for this purpose very early, and they have retained that
character to the present; so that their utility in this respect
has now long been the substantial ground on which these usages
rest. Costly entertainments, such as the potlatch or the ball,
are peculiarly adapted to serve this end. The competitor with
whom the entertainer wishes to institute a comparison is, by this
method, made to serve as a means to the end. He consumes
vicariously for his host at the same time that he is witness to
the consumption of that excess of good things which his host is
unable to dispose of single-handed, and he is also made to
witness his host's facility in etiquette.
     In the giving of costly entertainments other motives, of
more genial kind, are of course also present. The custom of
festive gatherings probably originated in motives of conviviality
and religion; these motives are also present in the later
development, but they do not continue to be the sole motives. The
latter-day leisure-class festivities and entertainments may
continue in some slight degree to serve the religious need and in
a higher degree the needs of recreation and conviviality, but
they also serve an invidious purpose; and they serve it none the
less effectually for having a colorable non-invidious ground in
these more avowable motives. But the economic effect of these
social amenities is not therefore lessened, either in the
vicarious consumption of goods or in the exhibition of difficult
and costly achievements in etiquette.
     As wealth accumulates, the leisure class develops further in
function and structure, and there arises a differentiation within
the class. There is a more or less elaborate system of rank and
grades. This differentiation is furthered by the inheritance of
wealth and the consequent inheritance of gentility. With the
inheritance of gentility goes the inheritance of obligatory
leisure; and gentility of a sufficient potency to entail a life
of leisure may be inherited without the complement of wealth
required to maintain a dignified leisure. Gentle blood may be
transmitted without goods enough to afford a reputably free
consumption at one's ease. Hence results a class of impecunious
gentlemen of leisure, incidentally referred to already. These
half-caste gentlemen of leisure fall into a system of
hierarchical gradations. Those who stand near the higher and the
highest grades of the wealthy leisure class, in point of birth,
or in point of wealth, or both, outrank the remoter-born and the
pecuniarily weaker. These lower grades, especially the
impecunious, or marginal, gentlemen of leisure, affiliate
themselves by a system of dependence or fealty to the great ones;
by so doing they gain an increment of repute, or of the means
with which to lead a life of leisure, from their patron. They
become his courtiers or retainers, servants; and being fed and
countenanced by their patron they are indices of his rank and
vicarious consumer of his superfluous wealth. Many of these
affiliated gentlemen of leisure are at the same time lesser men
of substance in their own right; so that some of them are
scarcely at all, others only partially, to be rated as vicarious
consumers. So many of them, however, as make up the retainer and
hangers-on of the patron may be classed as vicarious consumer
without qualification. Many of these again, and also many of the
other aristocracy of less degree, have in turn attached to their
persons a more or less comprehensive group of vicarious consumer
in the persons of their wives and children, their servants,
retainers, etc.
     Throughout this graduated scheme of vicarious leisure and
vicarious consumption the rule holds that these offices must be
performed in some such manner, or under some such circumstance or
insignia, as shall point plainly to the master to whom this
leisure or consumption pertains, and to whom therefore the
resulting increment of good repute of right inures. The
consumption and leisure executed by these persons for their
master or patron represents an investment on his part with a view
to an increase of good fame. As regards feasts and largesses this
is obvious enough, and the imputation of repute to the host or
patron here takes place immediately, on the ground of common
notoriety . Where leisure and consumption is performed
vicariously by henchmen and retainers, imputation of the
resulting repute to the patron is effected by their residing near
his person so that it may be plain to all men from what source
they draw. As the group whose good esteem is to be secured in
this way grows larger, more patent means are required to indicate
the imputation of merit for the leisure performed, and to this
end uniforms, badges, and liveries come into vogue. The wearing
of uniforms or liveries implies a considerable degree of
dependence, and may even be said to be a mark of servitude, real
or ostensible. The wearers of uniforms and liveries may be
roughly divided into two classes-the free and the servile, or the
noble and the ignoble. The services performed by them are
likewise divisible into noble and ignoble. Of course the
distinction is not observed with strict consistency in practice;
the less debasing of the base services and the less honorific of
the noble functions are not infrequently merged in the same
person. But the general distinction is not on that account to be
overlooked. What may add some perplexity is the fact that this
fundamental distinction between noble and ignoble, which rests on
the nature of the ostensible service performed, is traversed by a
secondary distinction into honorific and humiliating, resting on
the rank of the person for whom the service is performed or whose
livery is worn. So, those offices which are by right the proper
employment of the leisure class are noble; such as government,
fighting, hunting, the care of arms and accoutrements, and the
like -- in short, those which may be classed as ostensibly
predatory employments. On the other hand, those employments which
properly fall to the industrious class are ignoble; such as
handicraft or other productive labor, menial services and the
like. But a base service performed for a person of very high
degree may become a very honorific office; as for instance the
office of a Maid of Honor or of a Lady in Waiting to the Queen,
or the King's Master of the Horse or his Keeper of the Hounds.
The two offices last named suggest a principle of some general
bearing. Whenever, as in these cases, the menial service in
question has to do directly with the primary leisure employments
of fighting and hunting, it easily acquires a reflected honorific
character. In this way great honor may come to attach to an
employment which in its own nature belongs to the baser sort.
     In the later development of peaceable industry, the usage of
employing an idle corps of uniformed men-at-arms gradually
lapses. Vicarious consumption by dependents bearing the insignia
of their patron or master narrows down to a corps of liveried
menials. In a heightened degree, therefore, the livery comes to
be a badge of servitude, or rather servility. Something of a
honorific character always attached to the livery of the armed
retainer, but this honorific character disappears when the livery
becomes the exclusive badge of the menial. The livery becomes
obnoxious to nearly all who are required to wear it. We are yet
so little removed from a state of effective slavery as still to
be fully sensitive to the sting of any imputation of servility.
This antipathy asserts itself even in the case of the liveries or
uniforms which some corporations prescribe as the distinctive
dress of their employees. In this country the aversion even goes
the length of discrediting -- in a mild and uncertain way --
those government employments, military and civil, which require
the wearing of a livery or uniform.
     With the disappearance of servitude, the number of vicarious
consumers attached to any one gentleman tends, on the whole, to
decrease. The like is of course true, and perhaps in a still
higher degree, of the number of dependents who perform vicarious
leisure for him. In a general way, though not wholly nor
consistently, these two groups coincide. The dependent who was
first delegated for these duties was the wife, or the chief wife;
and, as would be expected, in the later development of the
institution, when the number of persons by whom these duties are
customarily performed gradually narrows, the wife remains the
last. In the higher grades of society a large volume of both
these kinds of service is required; and here the wife is of
course still assisted in the work by a more or less numerous
corps of menials. But as we descend the social scale, the point
is presently reached where the duties of vicarious leisure and
consumption devolve upon the wife alone. In the communities of
the Western culture, this point is at present found among the
lower middle class.
     And here occurs a curious inversion. It is a fact of common
observance that in this lower middle class there is no pretense
of leisure on the part of the head of the household. Through
force of circumstances it has fallen into disuse. But the
middle-class wife still carries on the business of vicarious
leisure, for the good name of the household and its master. In
descending the social scale in any modern industrial community,
the primary fact-the conspicuous leisure of the master of the
household-disappears at a relatively high point. The head of the
middle-class household has been reduced by economic circumstances
to turn his hand to gaining a livelihood by occupations which
often partake largely of the character of industry, as in the
case of the ordinary business man of today. But the derivative
fact-the vicarious leisure and consumption rendered by the wife,
and the auxiliary vicarious performance of leisure by
menials-remains in vogue as a conventionality which the demands
of reputability will not suffer to be slighted. It is by no means
an uncommon spectacle to find a man applying himself to work with
the utmost assiduity, in order that his wife may in due form
render for him that degree of vicarious leisure which the common
sense of the time demands.
     The leisure rendered by the wife in such cases is, of
course, not a simple manifestation of idleness or indolence. It
almost invariably occurs disguised under some form of work or
household duties or social amenities, which prove on analysis to
serve little or no ulterior end beyond showing that she does not
occupy herself with anything that is gainful or that is of
substantial use. As has already been noticed under the head of
manners, the greater part of the customary round of domestic
cares to which the middle-class housewife gives her time and
effort is of this character. Not that the results of her
attention to household matters, of a decorative and mundificatory
character, are not pleasing to the sense of men trained in
middle-class proprieties; but the taste to which these effects of
household adornment and tidiness appeal is a taste which has been
formed under the selective guidance of a canon of propriety that
demands just these evidences of wasted effort. The effects are
pleasing to us chiefly because we have been taught to find them
pleasing. There goes into these domestic duties much solicitude
for a proper combination of form and color, and for other ends
that are to be classed as aesthetic in the proper sense of the
term; and it is not denied that effects having some substantial
aesthetic value are sometimes attained. Pretty much all that is
here insisted on is that, as regards these amenities of life, the
housewife's efforts are under the guidance of traditions that
have been shaped by the law of conspicuously wasteful expenditure
of time and substance. If beauty or comfort is achieved-and it is
a more or less fortuitous circumstance if they are-they must be
achieved by means and methods that commend themselves to the
great economic law of wasted effort. The more reputable,
"presentable" portion of middle-class household paraphernalia
are, on the one hand, items of conspicuous consumption, and on
the other hand, apparatus for putting in evidence the vicarious
leisure rendered by the housewife.
     The requirement of vicarious consumption at the hands of the
wife continues in force even at a lower point in the pecuniary
scale than the requirement of vicarious leisure. At a point below
which little if any pretense of wasted effort, in ceremonial
cleanness and the like, is observable, and where there is
assuredly no conscious attempt at ostensible leisure, decency
still requires the wife to consume some goods conspicuously for
the reputability of the household and its head. So that, as the
latter-day outcome of this evolution of an archaic institution,
the wife, who was at the outset the drudge and chattel of the
man, both in fact and in theory -- the producer of goods for him
to consume -- has become the ceremonial consumer of goods which
he produces. But she still quite unmistakably remains his chattel
in theory; for the habitual rendering of vicarious leisure and
consumption is the abiding mark of the unfree servant.
     This vicarious consumption practiced by the household of the
middle and lower classes can not be counted as a direct
expression of the leisure-class scheme of life, since the
household of this pecuniary grade does not belong within the
leisure class. It is rather that the leisure-class scheme of life
here comes to an expression at the second remove. The leisure
class stands at the head of the social structure in point of
reputability; and its manner of life and its standards of worth
therefore afford the norm of reputability for the community. The
observance of these standards, in some degree of approximation,
becomes incumbent upon all classes lower in the scale. In modern
civilized communities the lines of demarcation between social
classes have grown vague and transient, and wherever this happens
the norm of reputability imposed by the upper class extends its
coercive influence with but slight hindrance down through the
social structure to the lowest strata. The result is that the
members of each stratum accept as their ideal of decency the
scheme of life in vogue in the next higher stratum, and bend
their energies to live up to that ideal. On pain of forfeiting
their good name and their self-respect in case of failure, they
must conform to the accepted code, at least in appearance.
     The basis on which good repute in any highly organized
industrial community ultimately rests is pecuniary strength; and
the means of showing pecuniary strength, and so of gaining or
retaining a good name, are leisure and a conspicuous consumption
of goods. Accordingly, both of these methods are in vogue as far
down the scale as it remains possible; and in the lower strata in
which the two methods are employed, both offices are in great
part delegated to the wife and children of the household. Lower
still, where any degree of leisure, even ostensible, has become
impracticable for the wife, the conspicuous consumption of goods
remains and is carried on by the wife and children. The man of
the household also can do something in this direction, and
indeed, he commonly does; but with a still lower descent into the
levels of indigence -- along the margin of the slums -- the man,
and presently also the children, virtually cease to consume
valuable goods for appearances, and the woman remains virtually
the sole exponent of the household's pecuniary decency. No class
of society, not even the most abjectly poor, forgoes all
customary conspicuous consumption. The last items of this
category of consumption are not given up except under stresS of
the direst necessity. Very much of squalor and discomfort will be
endured before the last trinket or the last pretense of pecuniary
decency is put away. There is no class and no country that has
yielded so abjectly before the pressure of physical want as to
deny themselves all gratification of this higher or spiritual
need.
     From the foregoing survey of the growth of conspicuous
leisure and consumption, it appears that the utility of both
alike for the purposes of reputability lies in the element of
waste that is common to both. In the one case it is a waste of
time and effort, in the other it is a waste of goods. Both are
methods of demonstrating the possession of wealth, and the two
are conventionally accepted as equivalents. The choice between
them is a question of advertising expediency simply, except so
far as it may be affected by other standards of propriety,
springing from a different source. On grounds of expediency the
preference may be given to the one or the other at different
stages of the economic development. The question is, which of the
two methods will most effectively reach the persons whose
convictions it is desired to affect. Usage has answered this
question in different ways under different circumstances.
     So long as the community or social group is small enough and
compact enough to be effectually reached by common notoriety
alone that is to say, so long as the human environment to which
the individual is required to adapt himself in respect of
reputability is comprised within his sphere of personal
acquaintance and neighborhood gossip -- so long the one method is
about as effective as the other. Each will therefore serve about
equally well during the earlier stages of social growth. But when
the differentiation has gone farther and it becomes necessary to
reach a wider human environment, consumption begins to hold over
leisure as an ordinary means of decency. This is especially true
during the later, peaceable economic stage. The means of
communication and the mobility of the population now expose the
individual to the observation of many persons who have no other
means of judging of his reputability than the display of goods
(and perhaps of breeding) which he is able to make while he is
under their direct observation.
     The modern organization of industry works in the same
direction also by another line. The exigencies of the modern
industrial system frequently place individuals and households in
juxtaposition between whom there is little contact in any other
sense than that of juxtaposition. One's neighbors, mechanically
speaking, often are socially not one's neighbors, or even
acquaintances; and still their transient good opinion has a high
degree of utility. The only practicable means of impressing one's
pecuniary ability on these unsympathetic observers of one's
everyday life is an unremitting demonstration of ability to pay.
In the modern community there is also a more frequent attendance
at large gatherings of people to whom one's everyday life is
unknown; in such places as churches, theaters, ballrooms, hotels,
parks, shops, and the like. In order to impress these transient
observers, and to retain one's self-complacency under their
observation, the signature of one's pecuniary strength should be
written in characters which he who runs may read. It is evident,
therefore, that the present trend of the development is in the
direction of heightening the utility of conspicuous consumption
as compared with leisure.
     It is also noticeable that the serviceability of consumption
as a means of repute, as well as the insistence on it as an
element of decency, is at its best in those portions of the
community where the human contact of the individual is widest and
the mobility of the population is greatest. Conspicuous
consumption claims a relatively larger portion of the income of
the urban than of the rural population, and the claim is also
more imperative. The result is that, in order to keep up a decent
appearance, the former habitually live hand-to-mouth to a greater
extent than the latter. So it comes, for instance, that the
American farmer and his wife and daughters are notoriously less
modish in their dress, as well as less urbane in their manners,
than the city artisan's family with an equal income. It is not
that the city population is by nature much more eager for the
peculiar complacency that comes of a conspicuous consumption, nor
has the rural population less regard for pecuniary decency. But
the provocation to this line of evidence, as well as its
transient effectiveness, is more decided in the city. This method
is therefore more readily resorted to, and in the struggle to
outdo one another the city population push their normal standard
of conspicuous consumption to a higher point, with the result
that a relatively greater expenditure in this direction is
required to indicate a given degree of pecuniary decency in the
city. The requirement of conformity to this higher conventional
standard becomes mandatory. The standard of decency is higher,
class for class, and this requirement of decent appearance must
be lived up to on pain of losing caste.
     Consumption becomes a larger element in the standard of
living in the city than in the country. Among the country
population its place is to some extent taken by savings and home
comforts known through the medium of neighborhood gossip
sufficiently to serve the like general purpose of Pecuniary
repute. These home comforts and the leisure indulged in -- where
the indulgence is found -- are of course also in great part to be
classed as items of conspicuous consumption; and much the same is
to be said of the savings. The smaller amount of the savings laid
by by the artisan class is no doubt due, in some measure, to the
fact that in the case of the artisan the savings are a less
effective means of advertisement, relative to the environment in
which he is placed, than are the savings of the people living on
farms and in the small villages. Among the latter, everybody's
affairs, especially everybody's pecuniary status, are known to
everybody else. Considered by itself simply -- taken in the first
degree -- this added provocation to which the artisan and the
urban laboring classes are exposed may not very seriously
decrease the amount of savings; but in its cumulative action,
through raising the standard of decent expenditure, its deterrent
effect on the tendency to save cannot but be very great.
     A felicitous illustration of the manner in which this canon
of reputability works out its results is seen in the practice of
dram-drinking, "treating," and smoking in public places, which is
customary among the laborers and handicraftsmen of the towns, and
among the lower middle class of the urban population generally
Journeymen printers may be named as a class among whom this form
of conspicuous consumption has a great vogue, and among whom it
carries with it certain well-marked consequences that are often
deprecated. The peculiar habits of the class in this respect are
commonly set down to some kind of an ill-defined moral deficiency
with which this class is credited, or to a morally deleterious
influence which their occupation is supposed to exert, in some
unascertainable way, upon the men employed in it. The state of
the case for the men who work in the composition and press rooms
of the common run of printing-houses may be summed up as follows.
Skill acquired in any printing-house or any city is easily turned
to account in almost any other house or city; that is to say, the
inertia due to special training is slight. Also, this occupation
requires more than the average of intelligence and general
information, and the men employed in it are therefore ordinarily
more ready than many others to take advantage of any slight
variation in the demand for their labor from one place to
another. The inertia due to the home feeling is consequently also
slight. At the same time the wages in the trade are high enough
to make movement from place to place relatively easy. The result
is a great mobility of the labor employed in printing; perhaps
greater than in any other equally well-defined and considerable
body of workmen. These men are constantly thrown in contact with
new groups of acquaintances, with whom the relations established
are transient or ephemeral, but whose good opinion is valued none
the less for the time being. The human proclivity to ostentation,
reenforced by sentiments of goodfellowship, leads them to spend
freely in those directions which will best serve these needs.
Here as elsewhere prescription seizes upon the custom as soon as
it gains a vogue, and incorporates it in the accredited standard
of decency. The next step is to make this standard of decency the
point of departure for a new move in advance in the same
direction -- for there is no merit in simple spiritless
conformity to a standard of dissipation that is lived up to as a
matter of course by everyone in the trade.
     The greater prevalence of dissipation among printers than
among the average of workmen is accordingly attributable, at
least in some measure, to the greater ease of movement and the
more transient character of acquaintance and human contact in
this trade. But the substantial ground of this high requirement
in dissipation is in the last analysis no other than that same
propensity for a manifestation of dominance and pecuniary decency
which makes the French peasant-proprietor parsimonious and
frugal, and induces the American millionaire to found colleges,
hospitals and museums. If the canon of conspicuous consumption
were not offset to a considerable extent by other features of
human nature, alien to it, any saving should logically be
impossible for a population situated as the artisan and laboring
classes of the cities are at present, however high their wages or
their income might be.
     But there are other standards of repute and other, more or
less imperative, canons of conduct, besides wealth and its
manifestation, and some of these come in to accentuate or to
qualify the broad, fundamental canon of conspicuous waste. Under
the simple test of effectiveness for advertising, we should
expect to find leisure and the conspicuous consumption of goods
dividing the field of pecuniary emulation pretty evenly between
them at the outset. Leisure might then be expected gradually to
yield ground and tend to obsolescence as the economic development
goes forward, and the community increases in size; while the
conspicuous consumption of goods should gradually gain in
importance, both absolutely and relatively, until it had absorbed
all the available product, leaving nothing over beyond a bare
livelihood. But the actual course of development has been
somewhat different from this ideal scheme. Leisure held the first
place at the start, and came to hold a rank very much above
wasteful consumption of goods, both as a direct exponent of
wealth and as an element in the standard of decency , during the
quasi-peaceable culture. From that point onward, consumption has
gained ground, until, at present, it unquestionably holds the
primacy, though it is still far from absorbing the entire margin
of production above the subsistence minimum.
     The early ascendency of leisure as a means of reputability
is traceable to the archaic distinction between noble and ignoble
employments. Leisure is honorable and becomes imperative partly
because it shows exemption from ignoble labor. The archaic
differentiation into noble and ignoble classes is based on an
invidious distinction between employments as honorific or
debasing; and this traditional distinction grows into an
imperative canon of decency during the early quasi-peaceable
stage. Its ascendency is furthered by the fact that leisure is
still fully as effective an evidence of wealth as consumption.
Indeed, so effective is it in the relatively small and stable
human environment to which the individual is exposed at that
cultural stage, that, with the aid of the archaic tradition which
deprecates all productive labor, it gives rise to a large
impecunious leisure class, and it even tends to limit the
production of the community's industry to the subsistence
minimum. This extreme inhibition of industry is avoided because
slave labor, working under a compulsion more vigorous than that
of reputability, is forced to turn out a product in excess of the
subsistence minimum of the working class. The subsequent relative
decline in the use of conspicuous leisure as a basis of repute is
due partly to an increasing relative effectiveness of consumption
as an evidence of wealth; but in part it is traceable to another
force, alien, and in some degree antagonistic, to the usage of
conspicuous waste.
     This alien factor is the instinct of workmanship. Other
circumstances permitting, that instinct disposes men to look with
favor upon productive efficiency and on whatever is of human use.
It disposes them to depreCate waste of substance or effort. The
instinct of workmanship is present in all men, and asserts itself
even under very adverse circumstances. So that however wasteful a
given expenditure may be in reality, it must at least have some
colorable excuse in the way of an ostensible purpose. The manner
in which, under special circumstances, the instinct eventuates in
a taste for exploit and an invidious discrimination between noble
and ignoble classes has been indicated in an earlier chapter. In
so far as it comes into conflict with the law of conspicuous
waste, the instinct of workmanship expresses itself not so much
in insistence on substantial usefulness as in an abiding sense of
the odiousness and aesthetic impossibility of what is obviously
futile. Being of the nature of an instinctive affection, its
guidance touches chiefly and immediately the obvious and apparent
violations of its requirements. It is only less promptly and with
less constraining force that it reaches such substantial
violations of its requirements as are appreciated only upon
reflection.
     So long as all labor continues to be performed exclusively
or usually by slaves, the baseness of all productive effort is
too constantly and deterrently present in the mind of men to
allow the instinct of workmanship seriously to take effect in the
direction of industrial usefulness; but when the quasi-peaceable
stage (with slavery and status) passes into the peaceable stage
of industry (with wage labor and cash payment) the instinct comes
more effectively into play. It then begins aggressively to shape
men's views of what is meritorious, and asserts itself at least
as an auxiliary canon of self-complacency. All extraneous
considerations apart, those persons (adult) are but a vanishing
minority today who harbor no inclination to the accomplishment of
some end, or who are not impelled of their own motion to shape
some object or fact or relation for human use. The propensity may
in large measure be overborne by the more immediately
constraining incentive to a reputable leisure and an avoidance of
indecorous usefulness, and it may therefore work itself out in
make-believe only; as for instance in "social duties," and in
quasi-artistic or quasi-scholarly accomplishments, in the care
and decoration of the house, in sewing-circle activity or dress
reform, in proficiency at dress, cards, yachting, golf, and
various sports. But the fact that it may under stress of
circumstances eventuate in inanities no more disproves the
presence of the instinct than the reality of the brooding
instinct is disproved by inducing a hen to sit on a nestful of
china eggs.
     This latter-day uneasy reaching-out for some form of
purposeful activity that shall at the same time not be
indecorously productive of either individual or collective gain
marks a difference of attitude between the modern leisure class
and that of the quasi-peaceable stage. At the earlier stage, as
was said above, the all-dominating institution of slavery and
status acted resistlessly to discountenance exertion directed to
other than naively predatory ends. It was still possible to find
some habitual employment for the inclination to action in the way
of forcible aggression or repression directed against hostile
groups or against the subject classes within the group; and this
sewed to relieve the pressure and draw off the energy of the
leisure class without a resort to actually useful, or even
ostensibly useful employments. The practice of hunting also sewed
the same purpose in some degree. When the community developed
into a peaceful industrial organization, and when fuller
occupation of the land had reduced the opportunities for the hunt
to an inconsiderable residue, the pressure of energy seeking
purposeful employment was left to find an outlet in some other
direction. The ignominy which attaches to useful effort also
entered upon a less acute phase with the disappearance of
compulsory labor; and the instinct of workmanship then came to
assert itself with more persistence and consistency.
     The line of least resistance has changed in some measure,
and the energy which formerly found a vent in predatory activity,
now in part takes the direction of some ostensibly useful end.
Ostensibly purposeless leisure has come to be deprecated,
especially among that large portion of the leisure class whose
plebeian origin acts to set them at variance with the tradition
of the otium cum dignitate. But that canon of reputability which
discountenances all employment that is of the nature of
productive effort is still at hand, and will permit nothing
beyond the most transient vogue to any employment that is
substantially useful or productive. The consequence is that a
change has been wrought in the conspicuous leisure practiced by
the leisure class; not so much in substance as in form. A
reconciliation between the two conflicting requirements is
effected by a resort to make-believe. Many and intricate polite
observances and social duties of a ceremonial nature are
developed; many organizations are founded, with some specious
object of amelioration embodied in their official style and
title; there is much coming and going, and a deal of talk, to the
end that the talkers may not have occasion to reflect on what is
the effectual economic value of their traffic. And along with the
make-believe of purposeful employment, and woven inextricably
into its texture, there is commonly, if not invariably, a more or
less appreciable element of purposeful effort directed to some
serious end.
     In the narrower sphere of vicarious leisure a similar change
has gone forward. Instead of simply passing her time in visible
idleness, as in the best days of the patriarchal regime, the
housewife of the advanced peaceable stage applies herself
assiduously to household cares. The salient features of this
development of domestic service have already been indicated.
     Throughout the entire evolution of conspicuous expenditure,
whether of goods or of services or human life, runs the obvious
implication that in order to effectually mend the consumer's good
fame it must be an expenditure of superfluities. In order to be
reputable it must be wasteful. No merit would accrue from the
consumption of the bare necessaries of life, except by comparison
with the abjectly poor who fall short even of the subsistence
minimum; and no standard of expenditure could result from such a
comparison, except the most prosaic and unattractive level of
decency. A standard of life would still be possible which should
admit of invidious comparison in other respects than that of
opulence; as, for instance, a comparison in various directions in
the manifestation of moral, physical, intellectual, or aesthetic
force. Comparison in all these directions is in vogue today; and
the comparison made in these respects is commonly so inextricably
bound up with the pecuniary comparison as to be scarcely
distinguishable from the latter. This is especially true as
regards the current rating of expressions of intellectual and
aesthetic force or proficiency' so that we frequently interpret
as aesthetic or intellectual a difference which in substance is
pecuniary only.
     The use of the term "waste" is in one respect an unfortunate
one. As used in the speech of everyday life the word carries an
undertone of deprecation. It is here used for want of a better
term that will adequately describe the same range of motives and
of phenomena, and it is not to be taken in an odious sense, as
implying an illegitimate expenditure of human products or of
human life. In the view of economic theory the expenditure in
question is no more and no less legitimate than any other
expenditure. It is here called "waste" because this expenditure
does not serve human life or human well-being on the whole, not
because it is waste or misdirection of effort or expenditure as
viewed from the standpoint of the individual consumer who chooses
it. If he chooses it, that disposes of the question of its
relative utility to him, as compared with other forms of
consumption that would not be deprecated on account of their
wastefulness. Whatever form of expenditure the consumer chooses,
or whatever end he seeks in making his choice, has utility to him
by virtue of his preference. As seen from the point of view of
the individual consumer, the question of wastefulness does not
arise within the scope of economic theory proper. The use of the
word "waste" as a technical term, therefore, implies no
deprecation of the motives or of the ends sought by the consumer
under this canon of conspicuous waste.
     But it is, on other grounds, worth noting that the term
"waste" in the language of everyday life implies deprecation of
what is characterized as wasteful. This common-sense implication
is itself an outcropping of the instinct of workmanship. The
popular reprobation of waste goes to say that in order to be at
peace with himself the common man must be able to see in any and
all human effort and human enjoyment an enhancement of life and
well-being on the whole. In order to meet with unqualified
approval, any economic fact must approve itself under the test of
impersonal usefulness-usefulness as seen from the point of view
of the generically human. Relative or competitive advantage of
one individual in comparison with another does not satisfy the
economic conscience, and therefore competitive expenditure has
not the approval of this conscience.
     In strict accuracy nothing should be included under the head
of conspicuous waste but such expenditure as is incurred on the
ground of an invidious pecuniary comparison. But in order to
bring any given item or element in under this head it is not
necessary that it should be recognized as waste in this sense by
the person incurring the expenditure. It frequently happens that
an element of the standard of living which set out with being
primarily wasteful, ends with becoming, in the apprehension of
the consumer, a necessary of life; and it may in this way become
as indispensable as any other item of the consumer's habitual
expenditure. As items which sometimes fall under this head, and
are therefore available as illustrations of the manner in which
this principle applies, may be cited carpets and tapestries,
silver table service, waiter's services, silk hats, starched
linen, many articles of jewelry and of dress. The
indispensability of these things after the habit and the
convention have been formed, however, has little to say in the
classification of expenditures as waste or not waste in the
technical meaning of the word. The test to which all expenditure
must be brought in an attempt to decide that point is the
questiOn whether it serves directly to enhance human life on the
whole-whether it furthers the life process taken impersonally.
For this is the basis of award of the instinct of workmanship,
and that instinct is the court of final appeal in any question of
economic truth or adequacy. It is a question as to the award
rendered by a dispassionate common sense. The question is,
therefore, not whether, under the existing circumstances of
individual habit and social custom, a given expenditure conduces
to the particular consumer's gratification or peace of mind; but
whether, aside from acquired tastes and from the canons of usage
and conventional decency, its result is a net gain in comfort or
in the fullness of life. Customary expenditure must be classed
under the head of waste in so far as the custom on which it rests
is traceable to the habit of making an invidious pecuniary
comparison-in so far as it is conceived that it could not have
become customary and prescriptive without the backing of this
principle of pecuniary reputability or relative economic success.
     It is obviously not necessary that a given object of
expenditure should be exclusively wasteful in order to come in
under the category of conspicuous waste. An article may be useful
and wasteful both, aud its utility to the consumer may be made up
of use and waste in the most varying proportions. Consumable
goods, and even productive goods, generally show the two elements
in combination, as constituents of their utility; although, in a
general way, the element of waste tends to predominate in
articles of consumption, while the contrary is true of articles
designed for productive use. Even in articles which appear at
first glance to serve for pure ostentation only, it is always
possible to detect the presence of some, at least ostensible,
useful purpose; and on the other hand, even in special machinery
and tools contrived for some particular industrial process, as
well as in the rudest appliances of human industry, the traces of
conspicuous waste, or at least of the habit of ostentation,
usually become evident on a close scrutiny. It would be hazardous
to assert that a useful purpose is ever absent from the utility
of any article or of any service, however obviously its prime
purpose and chief element is conspicuous waste; and it would be
only less hazardous to assert of any primarily useful product
that the element of waste is in no way concerned in its value,
immediately or remotely.

 
    1. In treating of wages, we have hitherto confined ourselves
to the causes which operate on them generally, and en masse; the
laws which govern the remuneration of ordinary or average labour:
without reference to the existence of different kinds of work
which are habitually paid at different rates, depending in some
degree on different laws. We will now take into consideration
these differences, and examine in what manner they affect or are
affected by the conclusions already established.
    A well-known and very popular chapter of Adam Smith(1*)
contains the best exposition yet given of this portion of the
subject. I cannot indeed think his treatment so complete and
exhaustive as it has sometimes been considered; but as far as it
goes, his analysis is tolerably successful.
    The differences, he says, arise partly from the policy of
Europe, which nowhere leaves things at perfect liberty, and
partly "from certain circumstances in the employments themselves,
which either really, or at least in the imaginations of men, make
up for a small pecuniary gain in some, and counterbalance a great
one in others." These circumstances he considers to be: "First,
the agreeableness or disagreeableness of the employments
themselves; secondly, the easiness and cheapness, or the
difficulty and expense of learning them; thirdly, the constancy
or inconstancy of employment in them; fourthly, the small or
great trust which must be reposed in those who exercise them; and
fifthly, the probability or improbability of success in them."
    Several of these points he has very copiously illustrated:
though his examples are sometimes drawn from a state of facts now
no longer existing. "The wages of labour vary with the ease or
hardship, the cleanliness or dirtiness, the honourableness or
dishonourableness of the employment. Thus, in most places, take
the year round, a journeyman tailor earns less than a journeyman
weaver. His work is much easier." Things have much altered, as to
a weaver's remuneration, since Adam Smith's time; and the artizan
whose work was more difficult than that of a tailor, can never, I
think, have been the common weaver. "A journeyman weaver earns
less than a journeyman smith. His work is not always easier, but
it is much cleanlier." A more probable explanation is, that it
requires less bodily strength. "A journeyman blacksmith, though
an artificer, seldom earns so much in twelve hours as a collier,
who is only a labourer, does in eight. His work is not quite so
dirty, is less dangerous, and is carried on in daylight, and
above ground. Honour makes a great part of the reward of all
honourable professions. In point of pecuniary gain, all things
considered," their recompense is, in his opinion, below the
average. "Disgrace has the contrary effect. The trade of a
butcher is a brutal and an odious business; but it is in most
places more profitable than the greater part of common trades.
The most detestable of all employments, that of public
executioner, is, in proportion to the quantity of work done,
better paid than any common trade whatever."
    One of the causes which make hand-loom weavers cling to their
occupation in spite of the scanty remuneration which it now
yields, is said to be a peculiar attractiveness arising from the
freedom of action which it allows to the workman. "He can play or
idle," says a recent authority,(2*) "as feeling or inclination
lead him; rise early or late, apply himself assiduously or
carelessly, as he pleases, and work up at any time by increased
exertion, hours previously sacrificed to indulgence or
recreation. There is scarcely another condition of any portion of
our working population thus free from external control. The
factory operative is not only mulcted of his wages for absence,
but, if of frequent occurrence, discharged altogether from his
employment. The bricklayer, the carpenter, the painter, the
joiner, the stonemason, the outdoor labourer, have each their
appointed daily hours of labour, a disregard of which would lead
to the same result." Accordingly, "the weaver will stand by his
loom while it will enable him to exist, however miserably; and
many, induced temporarily to quit it, have returned to it again,
when work was to be had."
    "Employment is much more constant," continues Adam Smith, "in
some trades than in others. In the greater part of manufactures,
a journeyman may be pretty sure of employment almost every day in
the year that he is able to work" (the interruptions of business
arising from overstocked markets, or from a suspension of demand,
or from a commercial crisis, must be excepted). "A mason or
bricklayer, On the contrary, can work neither in hard frost nor
in foul weather, and his employment at all other times depends
upon the occasional calls of his customers. He is liable, in
consequence, to be frequently without any. What he earns,
therefore, while he is employed, must not only maintain him while
he is idle, hut make him some compensation for those anxious
thought of so precarious a situation must sometimes computed
earnings of the greater part of manufacturers, are nearly upon a
level with the day wages of common labourers, those of masons and
bricklayers are generally from one-half more to double those
wages. No species of skilled labour, however, seems more easy to
learn than that of masons and bricklayers. The high wages of
those workmen, therefore, are not so much the recompense of their
skill, as the compensation for the inconstancy of their
employment.
    "When the inconstancy of the employment is combined with the
hardship, disagreeableness, and dirtiness of the work, it
sometimes raises the wages of the most common labour above those
of the most skilled artificers. A collier working by the piece,
is supposed, at Newcastle, to earn commonly about double, and in
many parts of Scotland about three times, the wages of common
labour. His high wages arise altogether from the hardship,
disagreeableness, and dirtiness of his work. His employment may,
upon most occasions, be as constant as he pleases. The
coal-heavers in London exercise a trade which in hardship,
dirtiness, and disagreeableness, almost equals that of colliers;
and from the unavoidable irregularity in the arrival of
coal-ships, the employment of the greater part of them is
necessarily very inconstant. If colliers, therefore, commonly
earn double and triple the wages of common labour, it ought not
to seem unreasonable that coal-heavers should sometimes earn four
or five times those wages. In the inquiry made into their
condition a few years ago, it was found that at the rate at which
they were then paid, they could earn about four times the wages
of common labour in London. How extravagant soever these earnings
may appear, if they were more than sufficient to compensate all
the disagreeable circumstances of the business, there would soon
be so great a number of competitors as, in a trade which has no
exclusive privilege, would quickly reduce them to a lower rate."
    These inequalities of remuneration, which are supposed to
compensate for the disagreeable circumstances of particular
employments, would, under certain conditions, be natural
consequences of perfectly free competition: and as between
employments of about the same grade, and filled by nearly the
same description of people, they are, no doubt, for the most
part, realized in practice. But it is altogether a false view of
the state of facts, to present this as the relation which
generally exists between agreeable and disagreeable employments.
The really exhausting and the really repulsive labours, instead
of being better paid than others, are almost invariably paid the
worst of all, because performed by those who have no choice. It
would be otherwise in a favourable state of the general labour
market. If the labourers in the aggregate, instead of exceeding,
fell short of the amount of employment, work which was generally
disliked would not be undertaken, except for more than ordinary
wages. But when the supply of labour so far exceeds the demand
that to find employment at all is an uncertainty, and to be
offered it on any terms a favour, the case is totally the
reverse. Desirable labourers, those whom every one is anxious to
have, can still exercise a choice. The undesirable must take what
they can get. The more revolting the occupation, the more certain
it is to receive the minimum of remuneration, because it devolves
on the most helpless and degraded, on those who from squalid
poverty, or from want of skill and education, are rejected from
all other employments. Partly from this cause, and partly from
the natural and artificial monopolies which will be spoken of
presently, the inequalities of wages are generally in an opposite
direction to the equitable principle of compensation erroneously
represented by Adam Smith as the general law of the remuneration
of labour. The hardships and the earnings, instead of being
directly proportional, as in any just arrangements of society
they would be, are generally in an inverse ratio to one another.
    One of the points best illustrated by Adam Smith, is the
influence exercised on the remuneration of an employment by the
uncertainty of success in it. If the chances are great of total
failure, the reward in case of success must be sufficient to make
up, in the general estimation, for those adverse chances. But,
owing to another principle of human nature, if the reward comes
in the shape of a few great prizes, it usually attracts
competitors in such numbers, that the average remuneration may be
reduced not only to zero, but even to a negative quantity. The
success of lotteries proves that this is possible: since the
aggregate body of adventurers in lotteries necessarily lose,
otherwise the undertakers could not gain. The case of certain
professions is considered by Adam Smith to be similar. "The
probability that any particular person shall ever be qualified
for the employment to which he is educated, is very different in
different occupations. In the greater part of mechanic trades,
success is almost certain, but very uncertain in the liberal
professions. Put your son apprentice to a shoemaker, there is
little doubt of his learning to make a pair of shoes; but send
him to study the law, it is at least twenty to one if ever he
makes such proficiency as will enable him to live by the
business. In a perfectly fair lottery, those who draw the pries
ought to gain all that is lost by those who draw the blanks. In a
profession where twenty fail for one that succeeds, that one
ought to gain all that should have been gained by the
unsuccessful twenty. The counsellor-at-law, who, perhaps, at near
forty years of age, begins to make something by his profession,
ought to receive the retribution, not only of his own so tedious
and expensive education, but of that of more than twenty others
who are never likely to make anything by it. How extravagant
soever the fees of counsellors-at-law may sometimes appear, their
real retribution is never equal to this. Compute in any
particular place, what is likely to be annually gained, and what
is likely to be annually spent, by all the different workmen in
any common trade, such as that of shoemakers or weavers, and you
will find that the former sum will generally exceed the latter.
But make the same computation with regard to all the counsellors
and students of law, in all the different inns of court, and you
will find that their annual gains bear but a small proportion to
their annual expense, even though you rate the former as high,
and the latter as low, as can well be done."
    Whether this is true in our own day, when the gains of the
few are incomparably greater than in the time of Adam Smith, but
also the unsuccessful aspirants much more numerous, those who
have the appropriate information must decide. It does not,
however, seem to be sufficiently considered by Adam Smith, that
the prizes which he speaks of comprise not the fees of counsel
only, but the places of emolument and honour to which their
profession gives access, together with the coveted distinction of
a conspicuous position in the public eye.
    Even where there are no great prizes, the mere love of
excitement is sometimes enough to cause an adventurous employment
to be overstocked. This is apparent "in the readiness of the
common people to enlist as soldiers, or to go to sea..... The
dangers and hair-breadth escapes of a life of adventures, instead
of disheartening young people, seem frequently to recommend a
trade to them. A tender mother, among the inferior ranks of
people, is often afraid to send her son to school at a sea-port
town, lest the sight of the ships and the conversation and
adventures of the sailors should entice him to go to sea. The
distant prospect of hazards from which we can hope to extricate
ourselves by courage and address, is not disagreeable to us, and
does not raise the wages of labour in any employment. It is
otherwise with those in which courage and address can be of no
avail. In trades which are known to be very unwholesome, the
wages of labour are always remarkably high. Unwholesomeness is a
species of disagreeableness, and its effects upon the wages of
labour are to be ranked under that general head."

    2. The preceding are cases in which inequality of
remuneration is necessary to produce equality of attractiveness,
and are examples of the equalizing effect of free competition.
The following are cases of real inequality, and arise from a
different principle. "The wages of labour vary according to the
small or great trust which must be reposed in the workmen. The
wages of goldsmiths and jewellers are everywhere superior to
those of many other workmen, not only of equal, but of much
superior ingenuity; on account of the precious materials with
which they are intrusted. We trust our health to the physician,
our fortune and sometimes our life and reputation to the lawyer
and attorney. Such confidence could not safely be reposed in
people of a very mean or low condition. Their reward must be
such, therefore, as may give them that rank in society which so
important a trust requires."
    The superiority of reward is not here the consequence of
competition, but of its absence: not a compensation for
disadvantages inherent in the employment, but an extra advantage;
a kind of monopoly price, the effect not of a legal, but of what
has been termed a natural monopoly. If all labourers were
trustworthy, it would not be necessary to give extra pay to
working goldsmiths on account of the trust. The degree of
integrity required being supposed to be uncommon, those who can
make it appear that they possess it are able to take advantage of
the peculiarity, and obtain higher pay in proportion to its
rarity. This opens a class of considerations which Adam Smith,
and most other political economists, have taken into far too
little account, and from inattention to which, he has given a
most imperfect exposition of the wide difference between the
remuneration of common labour and that of skilled employments.
    Some employments require a much longer time to learn, and a
much more expensive course of instruction than others; and to
this extent there is, as explained by Adam Smith, an inherent
reason for their being more highly remunerated. If an artizan
must work several years at learning his trade before he can earn
anything, and several years more before becoming sufficiently
skilful for its finer operations, he must have a prospect of at
last earning enough to pay the wages of all this past labour,
with compensation for the delay of payment, and an indemnity for
the expenses of his education. His wages, consequently, must
yield, over and above the ordinary amount, an annuity sufficient
to repay these sums, with the common rate of profit, within the
number of years he can expect to live and to be in working
condition. This, which is necessary to place the skilled
employments, all circumstances taken together, on the same level
of advantage with the unskilled, is the smallest difference which
can exist for any length of time between the two remunerations,
since otherwise no one would learn the skilled employments. And
this amount of difference is all which Adam Smith's principles
account for. When the disparity is greater, he seems to think
that it must be explained by apprentice laws, and the rules of
corporations which restrict admission into many of the skilled
employments. But, independently of these or any other artificial
monopolies, there is a natural monopoly in favour of skilled
labourers against the unskilled, which makes the difference of
reward exceed, sometimes in a manifold proportion, what is
sufficient merely to equalize their advantages. If unskilled
labourers had it in their power to compete with skilled, by
merely taking the trouble of learning the trade, the difference
of wages might not exceed what would compensate them for that
trouble, at the ordinary rate at which labour is remunerated. But
the fact that a course of instruction is required, of even a low
degree of costliness, or that the labourer must be maintained for
a considerable time from other sources, suffices everywhere to
exclude the great body of the labouring people from the
possibility of any such competition. Until lately, all
employments which required even the humble education reading and
writing, could be recruited only from a select class, the
majority having had no opportunity of acquiring those
attainments. All such employments, accordingly, were immensely
overpaid, as measured by the ordinary remuneration of labour.
Since reading and writing have been brought within the reach of a
multitude, the monopoly price of the lower grade of educated
employments has greatly fallen, the competition for them having
increased in an almost incredible degree. There is still,
however, a much greater disparity than can be accounted for on
the principle of competition. A clerk from whom nothing is
required but the mechanical labour of copying, gains more than an
equivalent for his mere exertion if he receives the wages of a
bricklayer's labourer. His work is not a tenth part as hard, it
is quite as easy to learn, and his condition is less precarious,
a clerk's place being generally a place for life. The higher rate
of his remuneration, therefore, must be partly ascribed to
monopoly, the small degree of education required being not even
yet so generally diffused as to call forth the natural number of
competitors; and partly to the remaining influence of an ancient
custom, which requires that clerks should maintain the dress and
appearance of a more highly paid class. In some manual
employments, requiring a nicety of hand which can only be
acquired by long practice, it is difficult to obtain at any cost
workmen in sufficient numbers, who are capable of the most
delicate kind of work; and the wages paid to them are only
limited by the price which purchasers are willing to give for the
commodity they produce. This is the case with some working
watchmakers, and with the makers of some astronomical and optical
instruments. If workmen competent to such employments were ten
times as numerous as they are, there would be purchasers for all
which they could make, not indeed at the present prices, but at
those lower prices which would be the natural consequence of
lower wages. Similar considerations apply in a still greater
degree to employments which it is attempted to confine to persons
of a certain social rank, such as what are called the liberal
professions; into which a person of what is considered too low a
class of society, is not easily admitted, and if admitted, does
not easily succeed.
    So complete, indeed, has hitherto been the separation, so
strongly marked the line of demarcation, between the different
grades of labourers, as to be almost equivalent to an hereditary
distinction of caste; each employment being chiefly recruited
from the children of those already employed in it, or in
employments of the same rank with it in social estimation, or
from the children of persons who, if originally of a lower rank,
have succeeded in raising themselves by their exertions. The
liberal professions are mostly supplied by the sons of either the
professional, or the idle classes: the more highly skilled manual
employments are filled up from the sons of skilled artizans, or
the class of tradesmen who rank with them: the lower classes of
skilled employments are in a similar case; and unskilled
labourers, with occasional exceptions, remain from father to son
in their pristine condition. Consequently the wages of each class
have hitherto been regulated by the increase of its own
population, rather than of the general population of the country.
If the professions are overstocked, it is because the class of
society from which they have always mainly been supplied, has
greatly increased in number, and because most of that class have
numerous families, and bring up some at least of their sons to
professions. If the wages of artizans remain so much higher than
those of common labourers, it is because artizans are a more
prudent class, and do not marry so early or so inconsiderately.
The changes, however, now so rapidly taking place in usages and
ideas, are undermining all these distinctions; the habits or
disabilities which chained people to their hereditary condition
are fast wearing away, and every class is exposed to increased
and increasing competition from at least the class immediately
below it. The general relaxation of conventional barriers, and
the increased facilities of education which already are, and will
be in a much greater degree, brought within the reach of all,
tend to produce, among many excellent effects, one which is the
reverse; they tend to bring down the wages of skilled labour. The
inequality of remuneration between the skilled and the unskilled
is, without doubt, very much greater than is justifiable; but it
is desirable that this should be corrected by raising the
unskilled, not by lowering the skilled. If, however, the other
changes taking place in society are not accompanied by a
strengthening of the checks to population on the part of
labourers generally, there will be a tendency to bring the lower
grades of skilled labourers under the influence of a rate of
increase regulated by a lower standard of living than their own,
and thus to deteriorate their condition without rising that of
the general mass; the stimulus given to the multiplication of the
lowest class being sufficient to fill up without difficulty the
additional space gained by them from those immediately above.

    3. A modifying circumstance still remains to be noticed,
which interferes to some extent with the operation of the
principles thus far brought to view. While it is true, as a
general rule, that the earnings of skilled labour, and especially
of any labour which requires school education, are at a monopoly
rate, from the impossibility, to the mass of the people, of
obtaining that education; it is also true that the policy of
nations, or the bounty of individuals, formerly did much to
counteract the effect of this limitation of competition, by
offering eleemosynary instruction to a much larger class of
persons than could have obtained the same advantages by paying
their price. Adam Smith has pointed out the operation of this
cause in keeping down the remuneration of scholarly or bookish
occupations generally, and in particular of clergymen, literary
men, and schoolmasters, or other teachers of youth. I cannot
better set forth this part of the subject than in his words.
    "It has been considered as of so much importance that a
proper number of young people should he educated for certain
professions, that sometimes the public, and sometimes the piety
of private founders, have established many pensions,
scholarships, exhibitions, bursaries, &c. for this purpose, which
draw many more people into those trades than could otherwise
pretend to follow them. In all Christian countries, I believe,
the education of the greater part of churchmen is paid for in
this manner. Very few of them are educated altogether at their
own expense. The long, tedious, and expensive education,
therefore, of those who are, will not always procure them a
suitable reward, the church being crowded with people who, in
order to get employment, are willing to accept of a much smaller
recompense than what such an education would otherwise have
entitled them to; and in this manner the competition of the poor
takes away the reward of the rich. It would be indecent, no
doubt, to compare either a curate or a chaplain with a journeyman
in any common trade. The pay of a curate or a chaplain, however,
may very properly be considered as of the same nature with the
wages of a journeyman. They are, all three, paid for their work
according to the contract which they may happen to make with
their respective superiors. Till after the middle of the
fourteenth century, five marks, containing as much silver as ten
pounds of our present money, was in England the usual pay of a
curate or a stipendiary parish priest, as we find it regulated by
the decrees of several different national councils. At the same
period fourpence a day, containing the same quantity of silver as
a shilling of our present money, was declared to be the pay of a
master-mason, and threepence a day, equal to ninepence of our
present money, that of a journeyman mason.(3*) The wages of both
these labourers, therefore, supposing them to have been
constantly employed, were much superior to those of the curate.
The wages of the master-mason, supposing him to have been without
employment one-third of the year, would have fully equalled them.
By the 12th of Queen Anne, c. 12, it is declared, 'That whereas
for want of sufficient maintenance and encouragement to curates,
the cures have in several places been meanly supplied, the bishop
is therefore empowered to appoint by writing under his hand and
seal a sufficient certain stipend or allowance, not exceeding
fifty, and not less than twenty pounds a year.' Forty pounds a
year is reckoned at present very good pay for a curate, and
notwithstanding this act of parliament, there are many curacies
under twenty pounds a year. This last sum does not exceed what is
frequently earned by common labourers in many country parishes.
Whenever the law has attempted to regulate the wages of workmen,
it has always been rather to lower them than to raise them. But
the law has upon many occasions attempted to raise the wages of
curates, and for the dignity of the Church, to oblige the rectors
of parishes to give them more than the wretched maintenance which
they themselves might be willing to accept of. And in both cases
the law seems to have been equally ineffectual, and has never
been either able to raise the wages of curates or to sink those
of labourers to the degree that was intended, because it has
never been able to hinder either the one from being willing to
accept of less than the legal allowance, on account of the
indigence of their situation and the multitude of their
competitors; or the other from receiving more, on account of the
contra competition of those who expected to derive either profit
or pleasure from employing them."
    In professions in which there are no benefices, such as law
(?) and physic, if an equal proportion of people were educated at
the public expense, the competition would soon be so great as to
sink very much their pecuniary reward. It might then not be worth
any man's while to educate his son to either of those professions
at his own expense. They would be entirely abandoned to such as
had been educated by those public charities; whose numbers and
necessities would oblige them in general to content themselves
with a very miserable recompense.
    "That unprosperous race of men, commonly called men of
letters, are pretty much in the situation which lawyers and
physicians probably would be in upon the foregoing supposition.
In every part of Europe, the greater part of them have been
educated for the church, but have been hindered by different
reasons from entering into holy orders. They have generally,
therefore, been educated at the public expense, and their numbers
are everywhere so great as to reduce the price of their labour to
a very paltry recompense.
    "Before the invention of the art of printing the only
employment by which a man of letters could make anything of his
talents, was that of a public or private teacher, or by
communicating to other people the curious and useful knowledge
which he had acquired himself: and this is still surely a more
honourable, a more useful, and in general even a more profitable
employment than that other of writing for a bookseller, to which
the art of printing has given occasion. The time and study, the
genius, knowledge, and application requisite to qualify an
eminent teacher of the sciences, are at least equal to what is
necessary for the greatest practitioners in law and physic. But
the usual reward of the eminent teacher bears no proportion to
that of the lawyer or physician; because the trade of the one is
crowded with indigent people who have been brought up to it at
the public expense, where those of the other two are encumbered
with very few who have not been educated at their own. The usual
recompense, however, of public and private teachers, small as it
may appear, would undoubtedly be less than it is, if the
competition of those yet more indigent men of letters who write
for bread was not taken out of the market. Before the invention
of the art of printing, a scholar and a beggar seem to have been
terms very nearly synonymous. The different governors of the
universities before that time appear to have often granted
licences to their scholars to beg."

    4. The demand for literary labour has so greatly increased
since Adam Smith wrote, while the provisions for eleemosynary
education have nowhere been much added to, and in the countries
which have undergone revolutions have been much diminished, that
little effect in keeping down the recompense of literary labour
can now be ascribed to the influence of those institutions. But
an effect nearly equivalent is now produced by a cause somewhat
similar -- the competition of persons who, by analog with other
arts, may be called amateurs. Literary occupation is one of those
pursuits in which success may be attained by persons the greater
part of whose time is taken up by other employments; and the
education necessary for it, is the common education of all
cultivated persons. The inducements to it, independently of
money, in the present state of the world, to all who have either
vanity to gratify, or personal or public objects to promote, are
strong. These motives now attract into this career a great and
increasing number of persons who do not need its pecuniary
fruits, and who would equally resort to it if it afforded no
remuneration at all. In our own country (to cite known examples),
the most influential, and on the whole most eminent philosophical
writer of recent times (Bentham), the greatest political
economist (Ricardo), the most ephemerally celebrated, and the
really greatest poets (Byron and Shelley), and the most
successful writer of prose (Scott), were none of them author by
profession; and only two of the five, Scott and Byron, could have
supported themselves by the works which they wrote. Nearly all
the higher departments of authorship are, to a great extent,
similarly filled. In consequence, although the highest pecuniary
prizes of successful authorship are incomparably greater than at
any former period, yet on any rational calculation of the
chances, in the existing competition, scarcely any writer can
hope to gain a living by books, and to do so by magazines and
reviews becomes daily more difficult. It is only the more
troublesome and disagreeable kinds of literary labour, and those
which confer no personal celebrity, such as most of those
connected with newspapers, or with the smaller periodicals, on
which an educated person can now rely for subsistence. Of these,
the remuneration is, on the whole, decidedly high; because,
though exposed to the competition of what used to be called "poor
scholars" (persons who have received a learned education from
some public or private charity), they are exempt from that of
amateurs, those who have other means of support being seldom
candidates for such employments. Whether these considerations are
not connected with something radically amiss in the idea of
authorship as a profession, and whether any social arrangement
under which the teachers of mankind consist of persons giving out
doctrines for bread, is suited to be, or can possibly be, a
permanent thing -- would be a subject well worthy of the
attention of thinkers.
    The clerical, like the literary profession, is frequently
adopted by persons of independent means, either from religious
zeal, or for the sake of the honour or usefulness which may
belong to it, or for a chance of the high prizes which it holds
out: and it is now principally for this reason that the salaries
of curates are so low., those salaries, though considerably
raised by the influence of public opinion, being still generally
insufficient as the sole means of support for one who has to
maintain the externals expected from a clergyman of the
established church.
    When an occupation is carried on chiefly by persons who
derive the main portion of their subsistence from other sources,
its remuneration may be lower almost to any extent, than the
wages of equally severe labour in other employments. The
principal example of the kind is domestic manufactures. When
spinning and knitting were carried on in every cottage, by
families deriving their principal support from agriculture, the
price at which their produce was sold (which constituted the
remuneration of the labour) was often so low, that there would
have been required great perfection of machinery to undersell it.
The amount of the remuneration in such a case, depends chiefly
upon whether the quantity of the commodity, produced by this
description of labour, suffices to supply the whole of the
demand. If it does not, and there is consequently a necessity for
some labourers who devote themselves entirely to the employment,
the price of the article must be sufficient to pay those
labourers at the ordinary rate, and to reward therefore very
handsomely the domestic producers. But if the demand is so
limited that the domestic manufacture can do more than satisfy
it, the price is naturally kept down to the lowest rate at which
peasant families think it worth while to continue the production.
It is, no doubt, because the Swiss artizans do not depend for the
whole of their subsistence upon their looms, that Zurich is able
to maintain a competition in the European market with English
capital, and English fuel and machinery.(4*) Thus far, as to the
remuneration of the subsidiary employment; but the effect to the
labourers of having this additional resource, is almost certain
to be (unless peculiar counteracting causes intervene) a
proportional dilution of the wages of their main occupation. The
habits of the people (as has already been so often remarked)
everywhere require some particular scale of living, and no more,
as the condition without which they will not bring up a family.
Whether the income which maintains them in this condition comes
from one source or from two, makes no difference: if there is a
second source of income, they require less from the first; and
multiply (at least this has always hitherto been the case) to a
point which leaves them no more from both employments, than they
would probably have had from either if it had been their sole
occupation.
    For the same reason it is found that, caeteris paribus, those
trades are generally the worst paid, in which the wife and
children of the artizan aid in the work. The income which the
habits of the class demand, and down to which they are almost
sure to multiply, is made up, in those trades, by the earnings of
the whole family, while in others the same income must be
obtained by the labour of the man alone. It is even probable that
their collective earnings will amount to a smaller sum than those
of the man alone in other trades; because the prudential
restraint on marriage is unusually weak when the only consequence
immediately felt is an improvement of circumstances, the joint
earnings of the two going further in their domestic economy after
marriage than before. Such accordingly is the fact, in the case
of hand-loom weavers. In most kinds of weaving, women can and do
earn as much as men, and children are employed at a very early
age; but the aggregate earnings of a family are lower than in
almost any other kind of industry, and the marriages earlier. It
is noticeable also that there are certain branches of hand-loom
weaving in which wages are much above the rate common in the
trade, and that these are the branches in which neither women nor
young persons are employed. These facts were authenticated by the
inquiries of the Hand-loom Weavers Commission, which made its
report in 1841. No argument can be hence derived for the
exclusion of women from the liberty of competing in the labour
market; since, even when no more is earned by the labour of a man
and a woman than would have been earned by the man alone, the
advantage to the woman of not depending on a master for
subsistence may be more than an equivalent. It cannot, however,
be considered desirable as a permanent element in the condition
of a labouring class, that the mother of the family (the case of
a single woman is totally different) should be under the
necessity of working for subsistence, at least elsewhere than in
their place of abode. In the case of children, who are
necessarily dependent, the influence of their competition in
depressing the labour market is an important element in the
question of limiting their labour, in order to provide better for
their education.

    5. It deserves consideration, why the wages of women are
generally lower, and very much lower, than those of men. They are
not universally so. Where men and women work at the same
employment, if it be one for which they are equally fitted in
point of physical power, they are not always unequally paid.
Women, in factories, sometimes earn as much as men; and so they
do in hand-loom weaving, which, being paid by the piece, brings
their efficiency to a sure test. When the efficiency is equal,
but the pay unequal, the only explanation that can be given is
custom; grounded either in a prejudice, or in the present
constitution of society, which, making almost every woman,
socially speaking, an appendage of some man, enables men to take
systematically the lion's share of whatever belongs to both. But
the principal question relates to the peculiar employments of
women. The remuneration of these is always, I believe, greatly
below that of employments of equal skill and equal
disagreeableness, carried on by men. In some of these cases the
explanation is evidently that already given: as in the case of
domestic servants, whose wages, speaking generally, are not
determined by competition, but are greatly in excess of the
market value of the labour, and in this excess, as in almost all
things which are regulated by custom, the male sex obtains by far
the largest share. In the occupations in which employers take
full advantage of competition, the low wages of women as compared
with the ordinary earnings of men, are a proof that the
employments are overstocked; that although so much smaller a
number of women, than of men, support themselves by wages, the
occupations which law and usage make accessible to them are
comparatively so few, that the field of their employment is still
more overcrowded. It must be observed, that as matters now stand,
a sufficient degree of overcrowding may depress the wages of
women to a much lower minimum than those of men. The wages, at
least of single women, must be equal to their support, but need
not be more than equal to it; the minimum, in their case, is the
pittance absolutely requisite for the sustenance of one human
being. Now the lowest point to which the most superabundant
competition can permanently depress the wages of a man, is always
somewhat more than this. Where the wife of a labouring man does
not by general custom contribute to his earnings, the man's wages
must be at least sufficient to support himself, a wife, and a
number of children adequate to keep up the population, since if
it were less the population would not be kept up. And even if the
wife earns something, their joint wages must be sufficient to
support not only themselves, but (at least for some years) their
children also. The ne plus ultra of low wages, therefore (except
during some transitory crisis, or in some decaying employment),
can hardly occur in any occupation which the person employed has
to live by, except the occupations of women.

    6. Thus far, we have, throughout this discussion, proceeded
on the supposition that competition is free, so far as regards
human interference; being limited only by natural causes, or by
unintended effect of general social circumstances. But law or
custom may interfere to limit competition. If apprentice laws, or
the regulations of corporate bodies, make the access to a
particular employment slow, costly, or difficult, the wages of
that employment may be kept much above their natural proportion
to the wages of common labour. They might be so kept without any
assignable limit, were it not that wages which exceed the usual
rate require corresponding prices, and that there is a limit to
the price at which even a restricted number of producers can
dispose of all they produce. In most civilized countries, the
restrictions of this kind which once existed have been either
abolished or very much relaxed, and will, no doubt, soon
disappear entirely. In some trades, however, and to some extent,
the combinations of workmen produce a similar effect. Those
combinations always fail to uphold wages at an artificial rate,
unless they also limit the number of competitors. But they do
occasionally succeed in accomplishing this. In several trades the
workmen have been able to make it almost impracticable for
strangers to obtain admission either as journeymen or as
apprentices, except in limited numbers, and under such
restrictions as they choose to impose. It was given in evidence
to the Hand-loom Weavers Commission, that this is one of the
hardships which aggravate the grievous condition of that
depressed class. Their own employment is overstocked and almost
ruined; but there are many other trades which it would not be
difficult for them to learn: to this, however, the combinations
of workmen in those other trades are said to interpose an
obstacle hitherto insurmountable.
    Notwithstanding, however, the cruel manner in which the
exclusive principle of these combinations operates in a case of
this peculiar nature, the question, whether they are on the whole
more useful or mischievous, requires to be decided on an enlarged
consideration of consequences, among which such a fact as this is
not one of the most important items. Putting aside the atrocities
sometimes committed by workmen in the way of personal outrage or
intimidation, which cannot be too rigidly repressed; if the
present state of the general habits of the people were to remain
for ever unimproved, these partial combinations, in so far as
they do succeed in keeping up the wages of any trade by limiting
its numbers, might be looked upon as simply intrenching around a
particular spot against the inroads of over-population, and
making the wages of the class depend upon their own rate of
increase, instead of depending on that of a more reckless and
improvident class than themselves. What at first sight seems the
injustice of excluding the more numerous body from sharing the
gains of a comparatively few, disappears when we consider that by
being admitted they would not be made better off, for more than a
short time; the only permanent effect which their admission would
produce, would be to lower the others to their own level. To what
extent the force of this consideration is annulled when a
tendency commences towards diminished over-crowding in the
labouring classes generally, and what grounds of a different
nature there may be for regarding the existence of trade
combinations as rather to be desired than deprecated, will be
considered in a subsequent chapter of this work, with the subject
of Combination Laws.

    7. To conclude this subject, I must repeat an observation
already made, that there are kinds of labour of which the wages
are fixed by custom, and not by competition. Such are the fees or
charges of professional persons: of physicians, surgeons,
barristers, and even attorneys. These, as a general rule, do not
vary, and though competition operates upon those classes as much
as upon any others, it is by dividing the business, not, in
general, by diminishing the rate at which it is paid. The cause
of this, perhaps, has been the prevalence of an opinion that such
persons are more trustworthy if paid highly in proportion to the
work they perform; insomuch that if a lawyer or a physician
offered his services at less than the ordinary rate, instead of
gaining more practice, he would probably lose that which he
already had. For analogous reasons it is usual to pay greatly
beyond the market price of their labour, all persons in whom the
employer wishes to place peculiar trust, or from whom he requires
something besides their mere services. For example, most persons
who can afford it, pay to their domestic servants higher wages
than would purchase in the market the labour of persons fully as
competent to the work required. They do this, not merely from
ostentation, but also from more reasonable motives; either
because they desire that those they employ should serve them
cheerfully, and be anxious to remain in their service; or because
they do not like to drive a hard bargain with people whom they
are in constant intercourse with; or because they dislike to have
near their persons, and continuity in their sight, people with
the appearance and habits which are the usual accompaniments of a
mean remuneration. Similar feelings operate in the minds of
persons in business, with respect to their clerks, and other
employes. Liberality, generosity, and the credit of the employer,
are motives which, to whatever extent they operate, preclude
taking the utmost advantage of competition: and doubtless such
motives might, and even now do, operate on employers of labour in
all the great departments of industry; and most desirable is it
that they should. But they can never raise the average wages of
labour beyond the ratio of population to capital. By giving more
to each person employed, they limit the power of giving
employment to numbers; and however excellent their moral effect,
they do little good economically, unless the pauperism of those
who are shut out, leads indirectly to a readjustment by means of
an increased restraint on population.

NOTES:

1. Wealth of Nations, book i, ch. 10.

2. Mr Muggerridge's Report to the Handloom Weavers Inquiry
Commission.

3. See the Statute of Labourers, 25 Edw. III.

4. Four-fifths of the manufacturers of the Canton of Zurich are
small farmers, generally proprietors of their farms. The cotton
manufacture occupies either wholly or partially 23,000 people,
nearly a tenth part of the population; and they consume a greater
quantity of cotton per inhabitant than either France or England. 
See the Statistical Account of Zurich formerly cited, pp. 105, 108, 
110.

       In the year 1164 from the Incarnation of our Lord, in the fourth year of the papacy of Alexander, in
    the tenth year of the most illustrious king of the English, Henry II., in the presence of that same king,
    this memorandum or inquest was made of some part of the customs and liberties. and dignities of his
    predecessors, viz., of king Henry his grandfather and others, which ought to be observed and kept in the
    kingdom. And on account of the dissensions and discords which had arisen between the clergy and the
    Justices of the lord king, and the barons of the kingdom concerning the customs and dignities, this
    inquest was made in the presence of the archbishops and bishops, and clergy and counts, and barons and
    chiefs of the kingdom. And these customs, recognized by the archbishops and bishops and counts and
    barons and by the nobler ones and elders of the kingdom, Thomas Archbishop of Canterbury, and Roger
    archbishop of York, and Gilbert bishop of London, and Henry bishop of Winchester, and Nigel bishop of
    Ely, and William bishop of Norwich, and Robert bishop of Lincoln, and Hilary bishop of Chichester, and
    Jocelin bishop of Salisbury, and Richard bishop of Chester, and Bartholemew bishop of Exeter and
    Robert bishop of Hereford, and David bishop of Mans, and Roger elect of Worcester, did grant; and,
    upon the Word of Truth did orally firmly promise to keep and observe, under the lord king and under his
    heirs, in good faith and without evil wile,-in the presence of the following: Robert count of I`eicester,
    Reginald count of Cornwall, Conan count of Bretagne, John count of Eu, Roger count of Clare, count
    Geoffrey of Mandeville, Hugo count of Chester, William count of Arundel, count Patrick, William
    count of Ferrara, Richard de I~uce, Reginald de St. Walelio, Roger Bigot, Reginald de Warren, Richer
    de Aquila, William de Braiose, Richard de Camville, Nigel de Mowbray, Simon de Bello Campo,
    Humphrey de Bohen Matthew de Hereford, Walter de Medway, Manassa Biseth -steward, William
    Malet, William de Curcy, Robert de Dunstanville, Jocelin de Balliol, William de Lanvale William de
    Caisnet, Geoffrey de Vere, William de Hastings Hugo de Moreville, Alan de Neville, Simon son of
    Peter William Malduit-chamberlain, John Malduit, John Marshall, Peter de Mare, and many other chiefs
    and nobles of the kingdom, clergy as well as laity. 

         A certain part, moreover, of the customs and dignities of the kingdom which were examined into,
    is contained in the present writing. Of which part these are the paragraphs; 

         § 1. If a controversy concerning advowson and presentation of churches arise between laymen, or
    between laymen and clerks, or between clerks, it shall be treated of and terminated in the court of the
    lord king. 

         § 2. Churches of the fee of the lord king cannot, unto all time, be given without his assent and
    concession. 

         § 3. Clerks charged and accused of anything, being summoned by the Justice of the king, shall
    come into his court, about to respond there for what it seems to the king's court that he should respond
    there; and in the ecclesiastical court for what it seems he should respond there; so that the Justice of the
    king shall send to the court of the holy church to see in what manner the affair will there be carried on.
    And if the clerk shall be convicted, or shall confess, the church ought not to protect him further. 

         § 4. It is not lawful for archbishops, bishops, and persons of the kingdom to go out of the kingdom
    without the permission of the lord king. And if it please the king and they go out, they shall give
    assurance that neither in going, nor in making a stay, nor in returning, will they seek the hurt or harm of
    king or kingdom. 

         § 5. The excommunicated shall not give a pledge as a permanency, nor take an oath, but only a
    pledge and surety of presenting themselves before the tribunal of the church, that they may be absolved. 

         § 6. Laymen ought not to be accused unless through reliable and legal accusers and witnesses in
    the presence of the bishop, in such wise that the archdean do not lose his right, nor any thing which he
    ought to have from it. And if those who are inculpated are such that no one wishes or dares to accuse
    them, the sheriff, being requested by the bishop, shall cause twelve lawful men of the neigh bourhood or
    town to swear in the presence of the bishop that they will make manifest the truth in this matter,
    according to their conscience. 

         § 7. No one who holds of the king in chief, and no one of his demesne servitors, shall be
    excommunicated, nor shall the lands of any one of them be placed under an interdict, unless first the
    lord king, if he be in the land, or his Justice, if he be without the kingdom, be asked to do justice
    concerning him: and in such way that what shall pertain to the king's court shall there be terminated; and
    with regard to that which concerns the ecclesiastical court, he shall be sent thither in order that it may
    there be treated of. 

         § 8. Concerning appeals, if they shall arise, from the archdean they shall proceed to the bishop,
    from the bishop to the archbishop. And if the archbishop shall fail to render justice, they must come
    finally to the lord king, in order that by his command the controversy may be terminated in the court of
    the archbishop, so that it shall not proceed further without the consent of the lord king. 

         § 9. If a quarrel arise between a clerk and a layman or between a layman and a clerk concerning any
    tenement which the clerk wishes to attach to the church property but the layman to a lay fee: by the
    inquest of twelve lawful men, through the judgment of the chief Justice of the king, it shall be
    determined, in the presence of the Justice himself, whether the tenement belongs to the church
    property, or to the lay fee. And if it be recognized as belonging to the church property, the case shall be
    pleaded in the ecclesiastical court; but if to the lay fee, unless both are holders from the same bishop or
    baron, the case shall be pleaded in the king's court. But if both vouch to warranty for that fee before the
    same bishop or baron, the case shall be pleaded in his court; in such way that, on account of the inquest
    made, he who was first in possession shall not lose his seisin, until, through the pleading, the case shall
    have been proven. 

         § 10. Whoever shall belong to the city or castle or fortress or demesne manor of the lord king, if
    he be summoned by the archdean or bishop for any offense for which he ought to respond to them, and
    he be unwilling to answer their summonses, it is perfectly right to place him under the interdict; but he
    ought not to be excommunicated until the chief servitor of the lord king of that town shall be asked to
    compel him by law to answer the summonses. And if the servitor of the king be negligent in this matter,
    he himself shall be at the mercy of the lord king, and the bishop may thenceforth visit the man who was
    accused with ecclesiastical justice. 

         § 11. Archbishops, bishops, and all persons of the kingdom who hold of the king in chief have their
    possessions of the lord king as a barony, and answer for them to the Justices and servitors of the king,
    and follow and perform all the customs and duties as regards the king; and, like other barons, they ought
    to be present with the barons at the judgments of the court of the lord king, until it comes to a judgment
    to loss of life or limb. 

         § 12. When an archbishopric is vacant, or a bishopric, or an abbey, or a priory of the demesne of
    the king, it ought to be in his hand; and he ought to receive all the revenues and incomes from it, as
    demesne ones. And, when it comes to providing for the church, the lord king should summon the more
    important persons of the church, and, in the lord king's own chapel, the election ought to take place with
    the assent of the lord king and with the counsel of the persons of the kingdom whom he had called for
    this purpose. And there, before he is consecrated, the person elected shall do homage and fealty to the
    lord king as to his liege lord, for his life and his members and his earthly honours, saving his order. 

         §13. If any of the nobles of the kingdom shall have dispossessed an archbishop or bishop or
    archdean, the lord king should compel them personally or through their families to do justice. And if by
    chance any one shall have dispossessed the lord king of his right, the archbishops and bishops and
    archdeans ought to compel him to render satisfaction to the lord king. 

         §14. A church or cemetery shall not, contrary to the king's justice, detain the chattels of those who
    are under penalty of forfeiture to the king, for they (the chattels) are the king's, whether they are found
    within the churches or without them. 

         § 16. Pleas concerning debts which are due through the giving of a bond, or without the giving of a
    bond, shall be in the jurisdiction of the king. 

         § 16. The sons of rustics may not be ordained without the consent of the lord on whose land they
    are known to have been born. 

         Moreover, a record of the aforesaid royal customs Anna dignities has been made by the foresaid
    archbishops and bishops, and counts and barons, and nobles and elders of the kingdom, at Clarendon on
    the fourth day before the Purification of the blessed Mary the perpetual Virgin; the lord Henry being
    there present with his father the lord king. There are, moreover, many other and great customs and
    dignities of the holy mother church, and of the lord king, and of the barons of the kingdom, which are
    not contained in this writ. And may they be preserved to the holy church, and to the lord king, and to his
    heirs, and to the barons of the kingdom, and may they be inviolably observed for ever. 

    Henderson's Note

         The list of articles laid before Thomas Becket in 1164, for finally refusing to sign which that
    prelate went into his long exile. 

         The custom of appealing to Rome-a custom which had begun under Henry I. whose brother was
    papal legate for England-had assumed alarming dimensions under Henry II. The king had almost no
    jurisdiction over his clerical subjects. And, to make matters worse, the clergy did not refrain from
    crimes which called for the utmost severity of the law. In ten years we hear of more than one hundred
    unpunished cases of murder among them. It was to put a stop to such lawlessness that Henry caused the
    constitutions of Clarendon to be drawn up by two of his justiciars. They contain nothing new, no right
    that did not belong by precedent to the crown. It was the way. in which the struggle with Becket was
    carried on, not the weakness of the King's standpoint that caused the latter to fail in his endeavours.
    Public sympathy turned against him and, in 1174, he was obliged to expressly permit appeals to Rome.
    Papal influence was to increase in England until it reached its zenith under Innocent III.liege lord and
    collector of tribute. 

                          Source:
                          Henderson, Ernest F.
                          Select Historical Documents of the Middle Ages
                          London : George Bell and Sons, 1896.