SECTION CLXVI.. Wages.--Price of Common Labor.

WAGES.--PRICE OF COMMON LABOR.

In the case of a commodity as universally desired as human labor is, the idea of the purchasers' capacity to pay (solvability) must be nearly commensurate with the national income, or to speak more correctly, with the world's income.[166-1] In regard to the different kinds of labor, and especially to common labor, it is evident that the different kinds of consumption require very different quantities of them. Here, therefore, we depend on the direction which national consumption takes, and this in turn is most intimately related to the distribution of the national income.[166-2] If all workmen were employed in nothing but the production of articles consumed by workmen, the rate of wages would be determined almost exclusively by the ratio between the number of the working population and the amount of the national income. But, if this were the case, landowners and capitalists would be obliged to live just as workmen do, and their highest luxury would have to consist in feeding idlers. (§ 226). The effect must be much the same, when the wealthy are exceedingly frugal and employ their savings as rapidly as possible in the employment of common home labor; while, on the other hand, the exportation of wheat, wood, and other articles, which the working classes consume, in exchange for diamonds, lace, champagne, diminishes the efficient demand for common labor in a country.[166-3]

The assumption frequently made, that the demand for labor depends on the size of the national capital, is far from exact.[166-4] Thus, for instance, every transformation of circulating into fixed capital, especially when the labor used in effecting this transformation is ended, diminishes the demand for other labor. That principle is not unconditionally true, even in the case of circulating capital. Thus, for instance, the rate of wages is wont to be raised by the transfer of capital from such businesses as require little labor into such as require much.[166-5] Only that part of circulating capital can have any weight here which is intended, directly or indirectly, for the purchase of labor and for the purchase of each kind of labor in particular.[166-6] The capital of the employer is, by no means, the real source[166-7] of the wages of even the workmen employed by him, It is only the immediate reservoir through which wages are paid out, until the purchasers of the commodities produced by that labor make good the advance, and thereby encourage the undertaker to purchase additional labor. Correlated to this is the fact, that other circumstances being the same, those workmen usually receive the highest wages who have to do most immediately with the consumer.[166-8]