Custom, Wages, And Work-Load In Nineteenth-Century Industry

Abstract

The basic principle of the nineteenth-century private enterprise economy was to buy in the cheapest market and to sell in the dearest. For the employer to buy labour in the cheapest market implied buying it at the lowest rate per unit of output, i.e. to buy the cheapest labour at the highest productivity. Conversely, for the worker to sell his labour in the dearest market meant logically to sell it at the highest price for the minimum unit of output. Obviously it was to the advantage of the bricklayer to get 7d. for an hour which meant the laying of 50 bricks rather than 100. The ideal situation envisaged by classical economics was one in which the wage-rate was fixed exclusively through the market without the intervention of non-economic compulsion on either side. For the employers this implied having a permanent reserve army of labour at all required grades of skill, for the workers permanent full, or rather over-full, employment. It also implied that both sides would be actuated by market motives: the employers by the search for the highest possible profit (which implied the lowest possible labour cost), the workers by the search for the highest possible wage (which implied complete responsiveness to wage-incentives).