Chapter III: The Principles of Wages 35

Sec. 1. A knowledge of the forces governing existing wage levels essential in any attempt to work out a policy of wage settlement for industrial peace.

Sec. 2. Wage incomes determined by great number of forces. The three most important and constant among these stated.

Sec. 3. These three to be taken up in order. The volume of the flow of wealth in the county of the worker the first to be considered. Its relation to wages indirect, as all product is joint result.

Sec. 4. The scientific management theories of wages based on a misconception of the relation between the productive contribution of labor and wages. These theories merely an elaboration of one method of wage payment. They have perceived one important truth, however.

Sec. 5. The "group-demand" theory of wages as held by some trade unions, based on a similar misconception. Valid, sometimes, from group point of view; unsound from point of view of labor in general.

Sec. 6. The second important force determining wages is the relative plenty or scarcity of the different groups or agents of production. How this governs the share of the product going to wage earners.

Sec. 7. Many important modifying forces to the influence upon wages of relative plenty or scarcity. The most important considered.

Sec. 8. The forces determining the sharing out of the product of industry summarized. The idea of normal equilibrium in distribution a mistaken one.

Sec. 9. A brief analysis of the factors which determine actual plenty or scarcity of the different agents of production at any one time.

Sec. 10. The third important force introduced--the relative plenty or scarcity of different kinds of labor. The existence of relatively separate groups of wage earners discussed. The nature of an investigation of the principles of wages.

Chapter IV--Principles of Wages (_Continued_) 69

Sec. 1. We have next to examine the causes of formation of relatively separate groups of wage earners.

Sec. 2. What is meant by a "relatively separate group"?

Sec. 3. The causes of the existence of these groups in the United States to-day. Inequality of natural ability; inequality of opportunity; artificial barriers. All these contradictory to assumptions behind theory of general rate of wages.

Sec. 4. Trade unions another factor in the formation of relatively separate groups. Indirect effects in opposite direction.

Sec. 5. Each of these groups has a relatively independent economic career. There are a series of wage levels, all of which are governed to a considerable extent by the same forces.

Sec. 6. The way in which the relative plenty or scarcity of each kind or group of labor affects its wages. Other forces play a part also.

Sec. 7. The nature of wage "differentials."

Chapter V--Wages and Price Movements 87

Sec. 1. The transactions of distribution arranged in terms of money. How does this affect the outcome of distribution as regards wages?

Sec. 2. The characteristics of price movements.

Sec. 3. The direct and indirect effects of upward price movements upon the distribution of the product.

Sec. 4. The direct and indirect effects of falling price movements upon the distribution of the product.

Sec. 5. The doctrine of the "vicious circle of wages and prices" examined. Its meaning and importance.

Chapter VI--Wages and Price Movements (_Continued_) 106

Sec. 1. The problems of wage settlement arising out of upward price movements two in number: (a) Should wages be increased during such periods? (b) If so, on what basis should increases be arranged? The doctrine of the maintenance of the standard of life analyzed.

Sec. 2. An alternative method of adjustment proposed, based on a new index number.

Sec. 3. Periods of falling prices also present two problems of wage settlement, similar in essentials to those presented by upward movement. These problems discussed.