300 THE ROYAL SOCIETY OF CANADA 



king into consideration, however, that the population of Canada in 

 1851 amounted to 1,842,261, whereas in 1911 it amounted to 7,206,643; 

 and considering the outside capital invested in the Country during 

 the two periods under consideration, it is found that quite as much 

 capital per head of population was introduced during the period from 

 1850 to 1860 as within the past ten years. This capital was expended 

 in the earlier period within the existing provinces of Ontario and Que- 

 bec, chiefly, outside of Montreal and its district, in the former pro- 

 vince. 



What we have to consider in each case is the effect which the 

 exceptional amounts of new capital, in proportion to the population, 

 had upon the economic and social condition of the country in these 

 two periods. First of all, we may briefly indicate the normal effect 

 upon employment and prices to be expected from such a sudden and 

 large influx of capital. This expenditure of capital, mainly in the 

 first instance upon the railroads, naturally made great demands on 

 labour, materials and instruments of construction. The last element 

 would be partly supplied from abroad and partly furnished within 

 the country. That supplied from abroad would correspondingly 

 increase the imports, while that furnished within the country would, 

 to some considerable extent, diminish exports and also stimulate 

 employment for labour and other supplies and equipment. On the 

 other hand, this expenditure and activity furnishes the chief initial 

 stimulus for mercantile and manufacturing enterprise within the towns 

 and cities, increasing, in like proportion, profits, salaries and wages. 

 The increase of wages and rates of profit in turn attract the immi- 

 gration of both employers and employed, but so long as the influx 

 of capital more than keeps pace with the increase in immigration, the 

 rates of wages and profits would continue to increase, and this was 

 the general experience both sixty years ago and recently. 



Naturally, one of the first and most obvious effects of the consider- 

 able increase in income and population is to augment the demand for 

 the various means of life. The means of life consist partly of native 

 products and partly of imports. The native products coming under 

 the influence of increased cost of production, through increased wages 

 and profits, naturally tend to rise in price more rapidly than imported 

 goods not subject to these exceptional influences. A reference to the 

 actual facts shows this to have occurred both in the fifties and recently. 

 Much of the most serious increase in the cost of living was due to 

 the rapid rise in the prices of domestic supplies, while the chief in- 

 crease in the values of foreign imports resulted from the cost of distri- 

 bution to the consumer after they had arrived in Canada. Domestic 

 supplies such as bread, meat including poultry and fish, dairy produce, 



