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 Vital Importance of Continued Improvement._--Intelligent study
will make it clear to every one that any assertion that machinery is
the enemy of labor is not merely erroneous, it is a contradiction of
the most striking and important fact connected with general progress.
The gains of labor during the past century, which have been partly due
to the occupation of areas of new land, have been largely due to the
mechanical inventions and technical discoveries which have put the
forces of nature so largely at man's disposal. These forces have
worked for all society, indeed, but they have worked largely for the
men who labor, whether in the factory, in the shop, on the railroad,
or on the farm. Their effects are all-pervasive, since they signify an
increase in the productive power of that final unit of social labor
on which wages generally depend. General riches have been and must
continue to be generally beneficent. As an isolated man working,
Crusoe-like, for himself alone, gains by every technical discovery he
can make and by everything he can add to his stock of productive
appliances, so society, the great and isolated organism which is the
tenant of our planet, reaps a benefit by every improvement it can
make, and the forces of distribution see to it that this benefit is
carried through and through the system and made to improve the
condition of the most humble members. Since the great areas of new
land are no longer available as a future resource, the hope of labor
during the coming centuries, under any form of industrial
organization, whether it be competitive or socialistic, rests on the
prospect of continued technical gains,--an unending succession of
calls on the exhaustless serving power of nature.
_The Effect of Changes in the Relative Amounts of Labor and
Capital._--The law of wages, as stated in an early chapter of this
work, makes it evident that an increase of population, while the
social fund of capital remains the same, would reduce the product of
marginal labor and therefore the rate of wages. In every establishment
into which more workmen should come, while its capital remained the
same in amount, the power of an individual worker to produce goods
would be lessened. Moreover, any influx of laborers into the society
as a whole would be attended by a diffusion of them among all the
groups and subgroups, so that the power of an individual laborer to
create any kind of goods would be reduced. This means that labor has
lost some of its power to create _commodity_, which is the concrete
name for general wealth, and its wages fall accordingly.
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