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
_A Radical Change in Theory._--Progress is self-perpetuating. Instead
of insuring a retrogression, it causes further progress. The man who
has advanced from the position in which he earned a bare subsistence
to one in which he earns comforts is, for that very reason, likely to
advance farther and to obtain the modest luxuries which appear on a
well-paid workman's budget. "To him that hath shall be given," and
that by the direct action of economic law. This is a radical departure
from the Malthusian conclusion.
_Three Possible Conditions for the Wage-earning Class._--Workers are
in one of three possible conditions:--
(1) They may have a fixed standard and a very low one. Whenever they
get more than this standard requires, they may marry early, rear large
families, and see their children sink to their own original condition.
(2) They may have a fixed standard, but a higher one. They may be
unwilling to marry early on the least they can possibly live on, but
may do so as soon as their pay affords a modicum of comfort.
(3) They may have a progressive standard. There may be something
dynamic in their psychology, and it may become a mental necessity for
them to live better and better with advancing years, and to place
their children in a higher status than they themselves ever obtained.
_A Historical Fact._--The manner in which Malthus was actually
interpreted was as much due to the condition of workers in his day as
to anything which he himself said. It was small comfort to know that,
under the law of population, wages might conceivably become higher and
remain so because of a higher standard of living, provided the higher
standard was never attained. Facts for a long time were discouraging.
In due time they changed for the better. The opening of vast areas of
new land made its influence felt. It raised the pay of labor faster
than the growth of population was able to bring it down. This had the
effect of establishing, not only a higher standard, but a rising
standard, and as one generation succeeded another it became habituated
to a better mode of living than had been possible before. It was the
sheer force of the new land supplemented by new capital and new
methods of industry that accomplished this. It pushed wages upward, in
spite of everything that would in itself have pulled them down.
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