As before, the condition necessary that the community shall gain by the use of machinery is and since p' cannot be >p, the community cannot lose, unless 91 or the capitalist also lose. be <q, From the result of the above investigation it would seem that we are entitled to draw the following conclusions: If we assume that a capitalist will employ machinery or labour as the one or the other will procure for him the highest rate of profit, then the employment of machinery will always increase the wealth of the community. Not only is the capitalist unable to secure his own advantage at the expense of any other class, he cannot even prevent a general participation in the benefit. The operation on the labourer is to abstract a fund which has been or would have been annually employed in the payment of wages, and annually renewed by the produce due to his exertions, and to supply new fund, by increasing the wealth of the community, a portion of which will in general be paid as wages; this portion is at first smaller than the fund abstracted, but it increases without any assignable limit, the rapidity of increase depending on the proportion in which the new fund is divided between the labourer and the other classes of society. Speaking with reference to the formulæ, the rapidity of increase depends on the values of the arbitrary quantities m, m1, m2, k, and these values can be assigned with greater or less exactness, as our statistical knowledge connected with the particular case is more or less accurate. APPENDIX. EXAMPLES extracted from writers on Political Economy. McCULLOCH, 2d Edition, 193. Comparison of two machines, one of which lasts one year the other ten years, the cost of each being £.20000, and their produce the same, the ratio of profit 10 per cent. When d = 10, let y and A become y' and A1, If G now represent the gain to the community by employing the more durable machine, Again, when the machine lasted 1 year there was paid in wages 10 mCy When 10 years, the amount paid in the pth year of its being employed will be 80871 G = C{5 m + {m ̧k + m2 (1 − k) p} 4220) mCy' + {m ̧k + m2 (1 − k) p} G = 518 Therefore if D. be the loss to the labour-fund at the end of the year by employing the more durable machine, D1 = C {m 5 88 {m1k + m2 (1−k) p}, 8087 4270 An improvement takes place in machinery which reduces prices 5 per cent. G=Cq - A = D1 = C − m {A — C(q−1)} – G {m,k + m2 (1 − k)} p (209-q+1)-2 [m, k+ m, (1 − k) p]} = 11 = = C {1− m q 10 {411-11 p}. the labour-fund will have gained. Hence, after 38 years the amount spent in wages is greater than it would have been if the improvement had not taken place, and increases beyond this period to an indefinite amount. The values assigned to m, &c. are entirely arbitrary, if m, M1, M2, and the labour-fund will be increased after 9 years. In the value of Dp the whole of C is supposed to be taken from the labour-fund, the data necessary for calculating the effect of the change enunciated in the proposition are not given. RICARDO, 3d Edition, 469. A capitalist employs £.20000, £.7000 of which is vested in irremoveable capital, and £.13000 in labour, profits being 10 per cent. He then abstracts £.6500 to pay machine makers, and £1000 for half the profits during the year the machinery is in progress. His capital is now £.6500 to pay wages, and £.7500 in machinery, in addition to the £.7000 irremoveable. The machinery is supposed indestructible, and no more is produced by it than will pay the common profits on the £.7500. Take the capital as £.13000, and suppose that with the aid of the £.7000 profits are raised on this from q-1 to q1-1. Now before the machinery was employed the produce of the £.7500 must have fetched 7500.q, and afterwards 7500. (q, − 1); - Dp = C (1 − m2-1) - {m, k+m, (1−k) p}, G = C. |