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
_Slow Change of the Foregoing Adjustments._--The line which represents
the comparative density of population is of course slowly changing
position as migration goes on from the older centers of population to
more newly occupied regions. If the present distribution of population
be represented by the line numbered 1, the distribution a hundred
years hence may be represented by the dotted line numbered 2, and that
which will exist after five hundred years shall have passed may be
represented by the dotted line numbered 3. Even within the economic
center the comparative density of population in different divisions is
therefore not to be treated as strictly permanent, and it is not to be
treated as in any sense permanent when we are forecasting effects that
will be realized several centuries hence. For a problem involving a
score or two of years the general conditions we have described may be
treated as, in the main, abiding.[6]
[6] The reason for confining attention to the central zone is
partly, as we have stated, because here only do we get a
quick response to an economic influence. Overproduction of
any article quickly lowers the value of it throughout the
area, and a mass of unemployed laborers affects wages
throughout the area more speedily than it does in the great
environing zone.
This, however, is only one reason for this limitation of the
scope of our immediate study. A serious fact is that, if we
include the entire world, we cannot establish, in the way we
have proposed, the natural standards toward which values,
wages, and interest are tending. It will be recalled that in
the static division of this treatise we have attained a
"natural" standard of wages by assuming that all dynamic
changes were to cease and that labor and capital were to move
to and fro in the system of industrial groups till each of
these agents produced as much in one subgroup as in another.
A computation of this kind might, within a limited area, be
made periodically, say once in ten years, and if this were
done it would give a series of static standards of wages. Now
these standards become higher as time advances. The static
rate of pay for labor is, as a rule, higher at any one date
than was the standard for a date ten years earlier, and lower
than will be that for a date ten years later. The normal rate
of pay about which actual wages fluctuate is a rising one.
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