ABSTRACT
We have seen that low wages do not mean low cost of production, and that a high standard of wages, instead of putting a country at a disadvantage in production, is really an advantage. This disposes of the claim that protection is rendered necessary by high wages, by showing the invalidity of the first assumption upon which it is based. But it is worth while to examine the second assumption in this claim—that production is determined by cost, so that a country of less advantages cannot produce if the free competition of a country of greater advantages be permitted. For while we are sometimes told that a country needs protection because of great natural advantages that ought to be developed, we are at other times told that protection is needed because of the sparseness of population, the want of capital or machinery or skill, or because of high taxes or a high rate of interest, * or other conditions which, it may be, involve real disadvantage.
