Principles of Political Economy · John Stuart Mill
PROFITS.
76. What is the cause of the existence of profits? And what, according to Mr. Mill, are the circumstances which determine the respective shares of the laborer and the capitalist? 77. (1.) What is the lowest rate of profit which can permanently exist? (2.) Why is this minimum variable? 78. Analyze the remuneration received by any of the following: (1) the proprietor of a cotton-mill managing his own mill; (2) a merchant conducting his own business; (3) a railway shareholder; (4) a holder of government funds. 79. Into what portions may we divide the return which is usually called profit? Which of these portions would be received by a merchant carrying on business with borrowed capital? 80. Analyze the payment called profits into its various elements. Point out in what respects the earnings of the employer differ from or resemble the wages paid to other classes of laborers. 81. It is asserted that “profits tend to an equality.” What conditions must be satisfied before this position can be maintained? 82. How is the alleged tendency of profits to equivalence in different employments to be reconciled with the notorious difference in the profit of different individuals? 83. Which one of the elements in profit has the greatest effect on its amount? Explain by comparing the causes which regulate each element. 84. How does Mill reconcile the high wages in America with Ricardo’s law of profits?
85. Explain the proposition that the rate of profits depends on the cost of labor, stating carefully what elements are included in cost of labor. 86. Explain what connection there may be between an increase of population and any of the elements entering into cost of labor. 87. What effect would an increase or diminution of population have upon cost of labor? 88. Explain Mill’s view as to the cost of labor being a function of three variables, considering the passages in which he says, 1. “If without labor becoming less efficient its remuneration fell, _no increase taking place in the cost of the articles composing that remuneration_;” 2. “If the laborer obtained a higher remuneration, _without any increased cheapness in the things composing it_; or if, without his obtaining more, _that which he did obtain would become more costly_”: profits in the last two cases would suffer a diminution; and discussing—Firstly, if the remuneration of labor falls, what can the cost of the articles composing that remuneration signify to the capitalist? Secondly, if the laborer gets a higher remuneration, what can the increased cheapness of the things composing it signify to the capitalist? 89. Is the contest between capital and labor permanent and fundamental? If not, give your reasons for your answer. 90. What is the effect on wages and profits of the introduction of machinery?
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