18 Pages

‘Price of wages': a curious phrase

In Section VI of Sraffa’s ‘Introduction’ to Ricardo’s Works, which concerns edition 2 of the Principles, the following paragraph occurs:

One group of apparently slight corrections may be more significant than at first appears. In ed. 1 Ricardo had frequently employed the curious phrase ‘price of wages’; in ed. 2 however the expression is removed in several cases, and its elimination is carried further in ed. 3. Although in places he clearly treats this phrase as interchangeable with ‘price of labour’ or simply ‘wages’, it must originally have been related to the expression ‘real value of wages’, which he uses in explaining the peculiar sense in which he is to be understood when he speaks of the rise or fall of wages: namely as referring to the proportion of the total product going to labour, and not to the absolute quantity of commodities received by the labourers. However, after thus defining the ‘real value of wages’, he did not use again that expression in the Principles, except when in ed. 3 he had to defend himself against Malthus’s complaint that he had adopted ‘new and unusual language’ in connection with wages:– a complaint renewed in later times by Marshall, who deplored Ricardo’s failure to invent some new term for the purpose. Perhaps the early use of ‘price of wages’ was a sign that Ricardo at first felt the need for a special term, whereas later he seems to have come to regard the unqualified term ‘wages’ as adequate, ‘at least among Political Economists’,1 to describe proportional wages.