ABSTRACT
This chapter examines the conditions under which an enforced increase in the wages rate paid in a particular occupation or place would injure the national dividend. It considers the effect that will be produced on the real income of workpeople, and so of the poor, as a whole. If the elasticity of demand for labour in the occupation where the wage rate has been raised is less than unity, the aggregate earnings of labour as a whole, and not merely the earnings in that occupation, will be increased, provided that either the casual method or the privileged class method of engaging labour, prevails in that occupation. If the real earnings of labour in the aggregate are increased by the manipulation of wages in any industry, a smaller portion of the productive power of the community is left available to provide payment for the services of capital.
