ABSTRACT
At the close of the last, and the commencement of the present, century both the state of the industrial world in England, and the method of economic speculation then coming into fashion, were peculiarly favourable to the rise of a doctrine which treats the rate of wages as depending on the ratio of a supposed wages-fund to the number of the labouring population. Under an industrial regime of this kind, it is evident that wages were, as a rule, advanced out of capital, and the capitalist reimbursed himself upon selling the product just as a bill discounter does on a bill becoming due. America is the only country except England in which the wages-fund theory has made many converts, and even there the conditions were so unfavourable to its growth that it would probably never have taken root if it had not been transplanted from a more congenial soil.
