274 WHEAT PRODUCTION IN NEW ZEALAND 



now advocate government regulation of railroad rates.' " 

 That it should be both possible and desirable for the 

 Government to fix prices in a monopoly industry, where 

 regulations can be enforced rigidly, will at once be 

 conceded by all. The monopoly itself fixes prices with 

 a view to the maximum net revenue. It should be 

 possible for another authority, with adequate knowledge 

 as to how far it is safe to go, to fix prices in the same 

 industry. According to Prof. Jethro Brown this control 

 implies little more than the extension of the principles 

 which underlie existing legislation for the protection of 

 the wage earner. If prices are fixed directly, then 

 this is the policy of the legislative minimum. By 

 authorising representatives of the various branches of 

 an industry to agree to prices, the policy of the wages 

 board will be followed. If an impartial tribunal is given 

 the duty of fixing prices, then use is made of the policy 

 of compulsory arbitration. Moreover, it must also be 

 conceded that price fixation may take various forms. It 

 may be direct ; or a maximum or a minimum price may 

 be declared ; or further, a monopoly may be called upon 

 to revise its prices ; finally, a sliding scale may be used. 

 Thus we find a very plausible argument in favour of 

 price control. 



But this analogy between attempts to fix prices and 

 the declaration of standard wages is an imperfect one. 

 Labour is only one element in the cost of production, 

 and when wages are fixed it is this element only which 

 is controlled. When, on the other hand, prices are fixed 

 at standard figures, then all the elements in cost of 

 production are controlled in a greater or less degree. 

 Thus, not only wages but also profits, interest, wages of 

 management, rent, etc., are all interfered with. More- 

 over, the difficulties encountered in fixing rates are at a 

 minimum, and the advantages at a maximum in the 

 case of those wages which are controlled at present by 



