CHAPTER I.

value be increased, in consequence of the rise of labour? It would be increased, if there were no stock employed in its construction, and no profits to be paid to the maker of it. If, for example, the machine were produced by 100 men working one year upon it with wages of 50 l. each, and its price were 5000 l. , should those wages rise to 55 l. its price would be 5500 l. : but this cannot be the case; less than 100 men are employed, or it could not be sold for 5000 l. ; for out of the 5000 l. must be paid the profits of the stock which employed the men. Suppose then that only eighty-five men were employed at an expense of 4250 l. per annum, and that the 750 l. , which the sale of the machine would produce over and above the wages advanced to the men, constituted the profits of the engineer's stock. When wages rose 10 per cent., he would be obliged to employ an additional capital of 425 l. , and would therefore employ 4675 l. , instead of 4250 l. , on which capital he would only get a profit of 325 l. if he continued to sell his machine for 5000 l. ; but this is precisely the case of all manufacturers and capitalists; the rise of wages affects them all. If therefore the maker of the machine should raise the price of his machine in consequence of a rise of wages, an unusual quantity of capital would be employed in the construction of such machines, till their price afforded only the usual profits. The manufacturer of hats, by the employment of the machine, if he sells his hats for 8000 l. , is precisely in the same situation as before; he employs no more capital, and obtains the same profits. The competition of trade would not long allow this; for as capital would flow to the most profitable employment, he would be obliged to lower the price of hats, till his profits had sunk to the general level. Thus then is the public benefited by machinery: these mute agents are always the produce of much less labour than that which they displace, even when they are of the same money value. Through their influence, an increase in the price of provisions which raises wages, will affect fewer persons: it will reach, as in the above instance, eighty-five men instead of a hundred; and the saving which is the consequence, shews itself in the reduced price of the commodity manufactured.