Concentration is the characteristic of the pres ent industrial system. In the light of what has been said it must be evident that this is not necessarily a concentration of capital, or in the ownership of the tools of production. so much as a concentration of the management of these tools. Through the stock company the ownership may be, and frequently is, widely diffused. The ad vantages of controlling large capital are: First, the cheapening of production by preventing the multiplication of machines and other facilities for industry; second, the extension of the divi sion of labor, the large business being able to organize its forces and find a place for its work men each according to his abilities more effective ly than the small business; third, the prevention of wasteful competition through diminution in the number of the controllers of capital. On the other hand, it tends to reduce the conductor of a small business to the position of a subordinate in a large establishment, thus depriving him of that personal interest in management which may lead to the practice of economy at the same time that it encourages a spirit of independence. Again, the possessor of a large capital is often able to crush out weak competitors, and there is danger lest, after ridding himself of his rivals, he will secure a monopoly price for his product. Looking at these obvious tendencies of the capi talistic system, the Socialists propose that all capital should be socialized. that is to say, ad ministered for the benefit of the community as a whole. They point to this concentration in the control of capital as rendering the change from individual to social ownership an easy step to take, for, the number of owners tending con stantly to diminish, there are fewer individuals to be sacrificed through the introduction of a socialistic system. Of the different socialistic
theories of capital the most important is that of Carl Marx, the author of the exhaustive work Des Kapital. Marx finds no other source of value than labor, and holds that it is through the unscrupulous exploitation of labor that the capitalist employer reaps his so-called profits. The force of unrestricted competition obliges the laborer to accept what terms he eau obtain from the employer, who through combination with his fellows seeks always to depress wages to the limit at which they will barely maintain the requisite labor-power. If six hours' work will produce enough to maintain this labor-power and the capitalist can oblige the laborer to work for ten, the four hours' work constitutes what Marx calls surplus labor value which is stolen or 'ex propriated' by the capitalist. Arguing in this way, Marx concludes with the advice, "Expropri ate the expropriators." Modern economists differ wholly from this view of the origin of value. maintaining that labor is not the sole source, but that value arises in a subjective sense from utility, and in an objective sense through the law of supply and demand. Thus denying Marx's premise, they can not admit the conclusion that remuneration for the use of capital is so much stolen from the product of labor.
For further discussion bearing on this sub ject. see INTEREST; RAGES; PROFITS; and POLIT ICAL ECONOMY.