Essentials of Economic Theory: As Applied to Modern Problems of Industry and Public PolicyClark, John Bates
General
Essentials of Economic Theory: As Applied to Modern Problems of Industry and Public Policy
Clark, John Bates
Economics
The base line _AD_ of this figure stands for the part of the world in
which economic law works rapidly and encounters comparatively few
obstructions; and the extension of the line represents the lands
outside of this region in which the laws are sluggish in their action.
It is as though this base line were a section of a vast surface
including both civilized and primitive states. _AB_ represents the
smallest population per unit of land of a given quality within the
central area, and _DC_ represents the largest, while the ascending
line _BC_ shows the gradations of essential density in the peopling of
different parts of it. At the point A the pressure of the population
on the resources of the soil is least, while at the point _D_ it is at
its greatest. At the point _A_ a man can get much out of the soil as
the return for his own bare labor, while at _D_ he can get
comparatively little; and at intervening points on the base a man gets
more than he does at _D_ and less than he does at _A_. His gains
measured in bushels of wheat, etc., vary inversely as the density of
the population and so decrease from the left of the figure toward the
right till the point _D_ is reached. The occupations of the different
localities are determined by these facts.
[Illustration]
_How Occupations vary with Differences of Land Crowding._--Crowding
the arable land causes labor to flow naturally to manufacturing
occupations, since in these it is not so greatly handicapped in
comparison with the labor of more sparsely peopled regions. In a
cotton mill in Manchester a man may contribute as many yards per day
toward the product of the mill as he would in a mill in Fall River;
but on an English farm one man's labor does not create as much
produce as it does on an American farm. The large amount of available
land per man in America has a great effect on the amount that a man
can produce by tilling it, but it has very little effect on the amount
of the cotton goods that his presence and labor in the mill insure. In
raising crops, therefore, the Englishman is at a more serious
disadvantage in comparison with the American. The fact is expressed in
a practical way by saying that the English labor is cheaper and is
therefore more available for making things that are exported to the
distant markets of the world than is labor of the same kind in
America; but the reason for this cheapness is primarily the land
crowding, which reduces the productive power of a final unit of labor
in the former country. Because the man cannot get for himself many
bushels of wheat per annum by working on land he can afford to work in
a mill at a rate corresponding with the value of the produce he could
secure as a cultivator.[3]
[3] In this connection see the discussion of the principles
of international trade in J. S. Mill's "Principles of
Political Economy," Book III, Chapter XVI.
Public-domain text, read in full here on John Shaqi.
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