Note 166-6 — Chapter III

Thus, Adam Smith divides "the funds destined for the payment of wages" into two kinds: the excess of employers' income over their own maintenance, and the excess of their capital over the demands of their own use of it. (Wealth of Nat, I, ch. 8.) Senior considers it a self-evident principle, that the rate of wages depends on the size of the "fund for the maintenance of laborers compared with the number of laborers to be maintained." (Three Lectures on the Rate of Wages, 1830, Outlines, 153, ff.) But what determines the quota of the aggregate national wealth and national income that is to constitute this fund? Carey, Rate of Wages, 1835, has a very exhaustive commentary on Senior.