SECTIONAL TRANSACTIONS.—F. 431 
SECTION F.—ECONOMIC SCIENCE & STATISTICS. 
(For references to the publication elsewhere of communicaticns entered in 
the following list of transactions, see p. 465.) 
Thursday, September 8. 
1. Miss G. Jess.—Cost-of-Living Sliding Scales. 
What is the effect on distribution of the automatic adjustment of wages to 
changes in the cost of living? 
It is argued that this depends mainly on the cause of the change in price 
level. 
When a rise in prices is due to currency or credit expansion, or a fall in 
prices is due to currency or credit contraction, the cost-of-living sliding scale 
tends to prevent arbitrary changes in the distribution of real income. 
When, however, price changes are the result of changes in the volume of 
production the effect is reversed. 
If prices are rising because goods are diminishing the purchasing power 
of wages can only be maintained at the expense of other incomes. 
Conversely, if prices are falling because goods are increasing the automatic 
reduction of wages to keep pace with prices lessens the relative share of the 
wage-earner in the goods income. 
2. Joint Meeting with Sections J and L. Discussion on Vocational 
Training and Tests. See p. 455. 
3. Mr. A. A. Mircuetyn.—The Breakdown of the Minimum Wage. 
In all the recent wages controversies, it seems to have been assumed as an 
axiom that wages must conform to a predetermined standard of living. This 
conception seems to find little or no place in economic textbooks. On the other 
nand, there seems to have been little or no audible protest on the part of 
economists. According to the subsistence theory of wages, it is impossible for 
general wages to fall below what is required to keep not each individual work- 
man but the supply of workmen in existence. That purports to be a true 
economic law, a corollary from the laws of supply and demand, population and 
diminishing returns. A wage based on an arbitrary standard of life beyond 
actual subsistence is not based on economic law, though of course it may be 
made a matter of legal or moral obligation. Minimum wage is inconsistent 
with the nature of wage which is a payment for a service. No one is compelled 
to employ at all, and no one can be compelled to employ at a loss. Even the 
rulers of a socialist state could give their workmen no more than an equal 
share of the total national product, which might very well be less than the 
desired standard. We are coming near, or perhaps have reached, the point 
where the entire wealth of the country is insufficient to pay the wages that are 
demanded. A wage based on standard of living, not on the value or selling 
price of the product, tends to (a) unemployment, (0) inefficiency. Reference 
was made to recent wage controversies. 
Friday, September 9. 
4. Presidential Address by Mr. W. L. Hicusns, on The Principles 
by which Wages are Determined. See p. 95. 
5, Prof. A. W. Krrxatpy.—The Wages System and Possible Develop- 
ments. 
Theory and practice in wages. How the present system arose; attempts at 
improvement; bonus systems ; profit sharing ; co-partnership—advantages and 
disadvantages. Influence of Trade Unions. Collective bargaining. Time and 
piece rates. The effects of the flat rate. Speeding up and restriction. Wage 
rate and labour cost. Scientific management and the employment of super- 
men; social and industrial effects; consequences of wide application. lt is 
suggested that the British policy should be grading. An early example of 
grading; the grading authority. Danger of placing responsibility of grading 
on employers. The ideal authority. Gradual development of Trade Union 
