all agricultural improvements whose effect is to increase production, and, secondly, by the facilities for foreign importation. These two causes lead to the same result—a greater abundance of produce— and from this comes a fall of prices, and a consequent fall of rents. At the same time it is quite possible that an increased quantity of products, even when sold at a lower price, will yield an equal or greater total. In this case rents will not fall, and may even rise.

Agricultural improvements, such as better ploughs and reaping machines, new highways, &c., which diminish the cost of production without increasing the total amount of products brought into the market, have a uniform tendency to raise rents. It is to this, together with the increase in the prices of meat and butter, that recently the rise of rent has generally been due.

§ 3. Arguments of Economists who Deny the Existence of Rent.

Certain economists, disciples of Bastiat and Carey, deny the existence of rent. The share of nature in production, says Bastiat, is always given gratuitously. If a rental is paid it is as a return for the labour and capital which have been sunk in the earth, and not for its natural fertility. Carey adds, contrary to the theory of Ricardo it is the light lands of the hills that are first cultivated, and only afterwards the more fertile districts of the valley.

Bastiat's statement is opposed to facts. The lands which yield the highest rent in virtue of returning the largest amount of produce with the least expense are often those in which the least human labour has been sunk. Such are the rich pasturelands of Normandy, the soil of Egypt, and the "black lands" of Russia and Roumania. You have only to ask a farmer to be told that one field in a farm can often pay twice the rent of another. The Clos-Vougeot, the Château-Lafitte, the Johannisberg, yield a rent ten times as high as that of neighbouring vineyards which have required the same amount of labour. The European rivers in which salmon is caught pay a very considerable rent. There are many sources of utilities which bear a price which owe their value entirely to nature.

The remark of Carey, on the other hand, has some foundation, but it does not weaken the principle of Ricardo's theory. Men have cultivated the most fertile or best situated lands first among those within their reach. For them other lands had no existence. When, later on, these other lands came into the market, they had the effect of an agricultural improvement. By yielding more abundant produce they momentarily arrested the rise of rents; but where they were of exceptional fertility they must themselves have paid a heavy rent from the first. Soon, wealth and population continuing to increase, the rents of all the lands increase also. On this point Ricardo is in the right.

CHAPTER V.

WAGES.

WAGES are the reward of labour.

Wages reckoned in money must not be confounded with wages calculated by the amount of commodities this money will procure. A workman can barely live in London on half-a-crown a day, because board and lodging are both very dear. In China or Japan with a third of this sum he need want for nothing, because everything is cheap.

What is important to the labourer is the amount of commodities, such as bread, meat, and clothing, which his wage will allow him to consume. A decrease in the cost of production, causing a fall in the price of products, tends indirectly to increase wages. The labourer does not receive more money, but for the same money gets more commodities.

§ 1. Systems of Remuneration.

Labourers are usually paid in money, but sometimes in kind, as in countries where the farm hands are still boarded by their master.

Labour may be paid according to time-by the day or hour; or according to the work done-by the job or piece, as when painters are paid by the square yard, or masons by the cubic foot. Payment

In

by the piece is preferable for many reasons. the first place it is fairer ; every one is paid according to his skill and his industry. Again, it stimulates activity by bringing home the feeling of responsibility -the mainspring of the economic world. Thus the total production is increased, and the cost of supervision abolished. If the workman is not tied down to a machine piecework enables him to choose his own hours, and to become, in a small way, a contractor himself, since all piecework is of the nature of a contract. On the other hand it is of great advantage to the master, who has only to pay for what he actually receives.

In spite of these advantages workmen dislike the introduction of piecework. In England they have often struck against it. In France, after the Revolution of 1848, they even demanded that it should be forbidden by law. They contend that the price of piecework is reckoned by what a "crack" workman can do, and that, consequently, an ordinary workman cannot earn a living. In reality work by the piece is, as a rule, better paid than work by the day, except when employers are compelled by competition either to reduce the rate or stop work altogether. It is to be wished that the system of piecework should prevail as widely as possible, inasmuch as by considerably increasing production it must indirectly promote the prosperity of the working classes.

A still greater stimulus to work and to the

improvement of the labourer's condition is afforded by adding to wages a certain share in the profits. It is now very usual to grant such a share to the manager and head-workmen in a commercial company in order to interest them in its success, and thus increase their zeal. The best results would follow if this system could be extended to all the workmen.

In France, Germany, Holland, and Switzerland, by a happy idea, some employers, instead of immediately handing over to their workmen this addition to their pay, save it so as to provide them with a fund for their old age.

§ 2. The Iron Law.

"In all kinds of work," says Turgot, "it must, and does, come to pass that a workman's wages are limited to what is needful for his subsistence." Later on Ricardo reproduced this idea, and believed that he had demonstrated its truth beyond contradiction. The wages of a workman, he says, naturally reduce themselves to what is indispensable if he is to live and support a family. He cannot be content with less, for excess of destitution diminishes the number of workmen, and the fewer the hands the higher the wages. Neither can he for any length of time obtain more; for easier circumstances increases the number of marriages and births, so that there are soon more hands in the