The Ultimate Standard of Value [28]
and more recently in his paper on "The Austrian Theory of Value," page 14. In order to avoid any possible misunderstanding that might result from a difference in the use of the term "historical cost" by Professor Macvane ("Marginal Utility", page 261), I would expressly state, that I apply the term "historical" as antiethical in "synchronous". I therefore include under this term not only that cost of production, which has actually been expended in the past,but also the cost of reproduction, in so far as this "historical" may be resolved into the cost of reproduction, in so far as this "historical" may be resolved into the single stae of primary productive power, which most in successive periods of time be applied or expended.
12. "Elements" page 214. "The exertions of al the different kinds of labor that are directlyor indirectly involved inmaing it,together with the abstinences or rather the writings required for saving the capital used to making it: all these efforts and sacrifices together will be called its real cost of production."
13. "Positive Theory of Capital", page 95 of English edition.
14. Ibid., page 229 of English edition.
15. For instance, "Elements", page 222, "the normal level about which the market price fluctuates will be this definite and fixed (money) cost of production." Compare also the explanation of "equilibrium", on page 219.
16. The very nature of my problem specially compels me to seek some settlement or agreement with the representatives of English and American science. Partly because their rival opinions touch most nearly the salient points of the controversy; partly because they already, in consequence of the great weight of scientific authority which they have upon their side, and of the the exceptionally able representatives which they have found, are in advance of all others. Besides, I have elsewhere taken occasion to refer tosome of the others whose opinions bear upon this point. I referred to Scharling's theory in my "Theory of Capital", p. 160, English edition; to Dietzel in two papers, "Zwischenwort sur Werttheorie" and "Wert, Kosten und Grenznutzen", in Conrad's Jarhbucher, N.F., vol xxi, and third edition, vol. iii.
17. I would not maintain that low wages must always result in a sinking of the point of equilibrium. It may very readily happen, that with very low wages the necessities of the laborer and so the marginal utility of the unit of money, which he receives, is so great that he is compelled, even to satisfy the most pressing wants, to endure long hours of labor. This occurs with us in the case of the miserably paid sewing women, who not unfrequently work from fourteen to fifteen hours a day. But, as a rule, and especially where the payment of wages is so arranged that the overtime is paid for a separate item from the regular time, the advance in wages will result in an increase in the supply of labor. This is always under the assumption that the laborer is free to determine how long he will work.
18. Professor J.B. Clark, in his paper on the "Ultimate Standard of Value," has set forth with great clearness and elegance, nearly the same thought which I have employed in the text. He certainly draws from it a conclusion which I am no more prepared to accept than his brilliant statement of a part of their premises.
19. "Elements", page 275.
20. We might compare the cost that cost three days of common labor at eighty cents and one day of skilled labor at one dollar and sixty cents with another cost that cost four days of common labor at eighty cents. If the law of cost is interpreted as meaning the sum of the pain or disutility endured, then these costs should have about the same value. It is manifest, however, that the fulfilling of the law of cost actually demands the opposite of this: that the costs should exchange in the ratio of ten to eight. The empirical law of cost is by no means the same thing as the regulation of price through the disutility of labor, and cannot be so. Or as Professor Green says in a paper on "Pain Cost and Opportunity Cost",
12. "Elements" page 214. "The exertions of al the different kinds of labor that are directlyor indirectly involved inmaing it,together with the abstinences or rather the writings required for saving the capital used to making it: all these efforts and sacrifices together will be called its real cost of production."
13. "Positive Theory of Capital", page 95 of English edition.
14. Ibid., page 229 of English edition.
15. For instance, "Elements", page 222, "the normal level about which the market price fluctuates will be this definite and fixed (money) cost of production." Compare also the explanation of "equilibrium", on page 219.
16. The very nature of my problem specially compels me to seek some settlement or agreement with the representatives of English and American science. Partly because their rival opinions touch most nearly the salient points of the controversy; partly because they already, in consequence of the great weight of scientific authority which they have upon their side, and of the the exceptionally able representatives which they have found, are in advance of all others. Besides, I have elsewhere taken occasion to refer tosome of the others whose opinions bear upon this point. I referred to Scharling's theory in my "Theory of Capital", p. 160, English edition; to Dietzel in two papers, "Zwischenwort sur Werttheorie" and "Wert, Kosten und Grenznutzen", in Conrad's Jarhbucher, N.F., vol xxi, and third edition, vol. iii.
17. I would not maintain that low wages must always result in a sinking of the point of equilibrium. It may very readily happen, that with very low wages the necessities of the laborer and so the marginal utility of the unit of money, which he receives, is so great that he is compelled, even to satisfy the most pressing wants, to endure long hours of labor. This occurs with us in the case of the miserably paid sewing women, who not unfrequently work from fourteen to fifteen hours a day. But, as a rule, and especially where the payment of wages is so arranged that the overtime is paid for a separate item from the regular time, the advance in wages will result in an increase in the supply of labor. This is always under the assumption that the laborer is free to determine how long he will work.
18. Professor J.B. Clark, in his paper on the "Ultimate Standard of Value," has set forth with great clearness and elegance, nearly the same thought which I have employed in the text. He certainly draws from it a conclusion which I am no more prepared to accept than his brilliant statement of a part of their premises.
19. "Elements", page 275.
20. We might compare the cost that cost three days of common labor at eighty cents and one day of skilled labor at one dollar and sixty cents with another cost that cost four days of common labor at eighty cents. If the law of cost is interpreted as meaning the sum of the pain or disutility endured, then these costs should have about the same value. It is manifest, however, that the fulfilling of the law of cost actually demands the opposite of this: that the costs should exchange in the ratio of ten to eight. The empirical law of cost is by no means the same thing as the regulation of price through the disutility of labor, and cannot be so. Or as Professor Green says in a paper on "Pain Cost and Opportunity Cost",