rigid wages fund. It is never suggested by Adam Smith that the wages fund is inelastic, and that wages could not at any given time have been greater or less than they actually were. The doctrine is seldom traced further back than to Malthus; and Malthus cannot be shown to have held the doctrine. With express reference to the passage last cited from the _Wealth of Nations_, he says that “it will be found that the funds for the maintenance of labour do not necessarily increase with the increase of wealth, and very rarely increase in proportion to it, and that the condition of the lower classes of society does not depend exclusively upon the increase of the funds for the maintenance of labour or the power of supporting a greater number of labourers” (_Essay_, 7th ed., III. xiii. 368). The condition of the working classes depended, he thought, partly on the rate at which the “funds for the maintenance of labour,”[628] or, as he expressed it at first, “_the resources of the country_”[629] and the demand for labour are increasing, and partly on the “habits of the people.” Among their habits we should need to put their education and their power of union among themselves, and consequent strength in a struggle with the masters, to obtain or to raise the market rate of wages. From Ricardo he differed on the subject of wages very much as on the subject of value. Ricardo looked at cost price as the natural value of an article, and mere subsistence as the natural wages of labour. Malthus could do neither.