Wages are usually calculated in money, and are called high or low according to the money price actually paid ; but the condition of the labourer is obviously affected by the price of commodities as well as by the amount of his wages. If the necessaries of life be cheap, low money wages will maintain him in comfort ; if they become dearer, higher wages will not improve his condition, but will leave him as he was. Hence it becomes a most important object to inquire whether the price of provisions affects the rate of wages. The disputes which have arisen upon this question would seem to be chiefly caused by attempts to apply a universal law to countries and employments under totally different circumstances. Some contend that as swages are regu lated by supply and demand,the price of provisions cannot affect them; while others maintain that the average prices of labour and of food must always, for long periods of years, conform one with the other. It is evident, at the outset, that the former are speaking of the market rate of wages, and the latter of the natural rate ; and if this distinction bo borne in mind, the two propositions may easily be reconciled. If the market rate of wages be high, it is because the demand for labour is greater than the immediate supply. A fall in the price of provisions could not then lower the rate of wages, because the supply of labour would still be the same ; but if the fall were permanent, the condition of the labourer would become so easy, that population would increase, and the eupply of labour would be more abundant. The market rate would thus be brought deem to the natural rate, unless capital should be increasing in the same proportion as tho supply of labour ; and any increase in the price of food must then check the growth of population, limit the supply of labour, and ultimately raise wages. There is the same tendency in the market price of labour to conform to the natural price as there is in the market price of commodities to conform to their real value. Both labour and commodities are equally capable of increase and diminution, and the varying causes which encourage or check production adjust the proportion between the natural or cost price and the market price. But in some countries the market rate of wages may be very much above the natural rate, and in others nearly the same. In ono country capital may be increasing more rapidly than population, and in another not so fast. It is clear that a rise or fall in the price of food cannot influence the rate of wages alike in all these countries. Where the wages are high, and capital is rapidly accumu lated, any reduction in the price of food and other commodities is a clear gain to the labourer, and can have only a very remote, if any, effect in lowering wages ; but where wages are already reduced to the natural rate, and capital is not increasing faster than population, wages will undoubtedly rise and fall with any permanent increase or diminution in the coat of subsistence.
The question is further affected by the differences which exist in the natural rate of wages in various countries. Where the natural rate is so low as only to afford the bare means of existence, the least rise in the price of food must be fatal to numbers of the Labouring population, and, by thus limiting the supply of labour, must raise its price; but where the natural rate is high, the labourers suffer indeed from a rise in the price of food, but their existence is not endangered, the supply of labour is not diminished, and their wages consequently do not rise. From these circumstances, it is evident that the precise condition of a country in respect to capital, population, and wages mug be ascertained before it can be determined whether the price of food will affect the money rate of wages. It may, however, be generally affirmed, that in proportion as the market rate approaches to the natural rate, and the latter to the mere cost of the commonest subsistence, will the price of the necesearies of life affect the rate of wages.
When the causes which regulate the price of labour are understood, the folly and injustice of any legislation to fix the rate of wages are obvious. The seller of an article will always endeavour to obtain a high price for it, which the purchaser will only give if he be unable to obtain it for less. Labour is the most important object that man has to buy or to selL Each will make the best bargain he can, and in this no law ought to restrain him. Laws may purpose to affect wages
either directly or indirectly. Direct interference with the rate of wages has been frequently resorted to. By several acts of parliament a legal rate of wages in particular employments' was ordered to be settled, from which any deviations either on the part of the employer or labourer were punishable. (See 25 Edw. III., stet. 1 ; 34 Edw. Ill., c. 11 ; 13 Rich. IL, e. 8; 11 Hen. \'I L, e. 22; 5 Eliz, c. 4 ; 1 James L, c. 6.) Unless all the causes of high or low wages already explained be visionary, it is plain that no law can overrule them and establish a legal rate different from that which natural causes would have produced. It may embarrass the operations of trade, and mischievously disturb the freedom of the labour market ; but it cannot attain its immediate end—a compulsory rate of wages. The experience of this fact has long since put an end to any each legislation in this country. The most pernicious interference with wages ever effected by the indirect operation of a Law resulted from the mode of administering the laws for the relief of the poor. Before these laws were altered in 1834, it was the practice in most parishes, especially in the south of England, to give relief from the poor-rate to labourers in proportion to the num ber of their children. The natural rate of wages was continually undergoing depression, because, marriages being encouraged without reference to the sufficiency of wages to support a family, population was extraordinarily promoted. At the same time,the property destined to support it was suffering diminution, by being taxed heavily for the payment of comparatively unproductive labour.
The only sound mode of raising wages and improving the condition of a people is to promote and encourage the increase of the general wealth of a country [Wzatru], by every means which legislative science points out as beat suited to that end, and at the same time to remove obstructions, and give facilities to the moral and intellectual improvement of the working classes. By these moans capital will be increasing with the natural growth of population ; while the labourers, with better habits, will be leas prone to reckless improvidence, and consequently not so likely to outrun the increase of capital.
It is not unusual for persona in particular employments to desire higher wages, and to enter into combinations against their masters in order to obtaiu them. Such combinations were formerly prohibited both by the common and statute law of this country ; but since the 5th Geo. IV., c. 95, if unattended with violence or intimidation, they are not unlawful Unless he has bound himself by a contract, every man has a right to give or withhold his own labour as he pleases ; but he has no right to prevent others from disposing of their labour. But the wily mode of rendering a combination effectual is to exclude fresh workmen, which frequently can only be done by molestation and threats, which are subversive of the freedom and peace of society. Strikes, temperately conducted, cannot in principle be couderuned, being often a necessary protection to the working classes. When masters are not dealing fairly with their workmen, the fear of a strike may often control them, especially as, when acting unjustly, they would find a difficulty in obtaining new hands. But where the cause of a strike or combination is not an occasional dispute concerning wages, but an attempt to limit the number of workmen by compulsory regulations and bye-laws, and to dictate to their employers. it is injurious to trade, and ultimately to the parties themselves. To the labouring classes at large such combinations cannot be beneficial. Whenever they are successful it is by excluding many competitors, who are, of course, injured by the exclusion. The labour market must become clogged by a mass of exclusive trades, which render it difficult to find employment. The injury suffered by trade in conse quence of the artificial limits to the supply of labour and the unnatu rally high wages must also have the effect of diminishing capital, and consequently the means of employing labour.
(Adam Smith's Wealth of Nations ; Itieardee Political Economy and Taxation ; Malthus, Essay on Population ; Mill, J., Elements of Political Economy ; Mill, J. S., Principles of Political Economy.)