108 SECTIONAL ADDRESSES. 



(b) the increased competition which rationalisation sometimes induces 

 among the workers, for ' even though the increased demand for the article, 

 produced by its diminished price, should speedily give occupation to all who 

 were before employed, yet the very diminution of the skill required would 

 open a wider field of competition amongst the working classes themselves,' 



(c) the difficulty in deciding whether, when improvements were made, the 

 process of displacement should be gradual or immediate : ' the suffering 

 which arises from a quick transition is undoubtedly more intense : but it 

 is also much less permanent than that which results from the slower 

 process : and if the competition is perceived to be perfectly hopeless, the 

 workman will at once set himself to learn a new department of his art.' 

 In the end Babbage was driven to adopt a very doubting tone : ' That 

 machines do not, even at their first introduction, invariably throw human 

 labour out of employment, must be admitted ; and it has been maintained, 

 by persons very competent to form an opinion on the subject, that they 

 never produce that efiect. The solution of this question depends on facts, 

 which unfortunately have not yet been collected,' and he makes a powerful 

 plea for further statistical information, which after the lapse of a century, 

 one is still forced to echo. 



Neither Chalmers, who believed in the doctrine of the Wage Fund, nor 

 Senior, who did not, denied that the effect of machinery might be to 

 increase unemployment. ' It is not the true Anndication,' argues the 

 former, ' that the making of the machines opens so great a source of em- 

 ployment, that the making and working of them together take up as many 

 hands as did the making of the commodities without the machines ; for, in 

 this case, there would be no abridgment of labour, and no advantage to 

 master-manufacturers in setting up the machinery. And it is not a sufficient 

 vindication, that, when an article is cheapened hf machinery the demand 

 for it is so much enlarged, as still, in spite of the abridgment in labour, to 

 require as many, if not more, labourers for its preparation as before : for 

 this, though true of many, perhaps most trades, is not true of all.''' The 

 true defence is that ' the fund, out of which wages come, is left unimpaired.' 

 Senior's general position cannot be shortly described, but he does at least 

 admit that when the demand is inelastic, emplojntnent declines, though 

 this is to him the exception. Citing the case of a screw which ' in the manu- 

 facture of corkscrews, performed the work of fifty-nine men,' he argued 

 that this example ' is as unfavourable to the effects of machinery as can 

 be proposed : for the use of the commodity is supposed to be unable to 

 keep up with the increased price of production, and the whole number of 

 labourers employed on it is, consequently, diminished. This, however, is 

 a very rare occurrence. The usual effect of an increase in the facility of 

 providing a commodity is so to increase its consumption as to occasion 

 the employment of more, not less, labour than before.' ^ 



The classical school had thus, by the middle of the last century, resolved 

 the problem into its constituent parts. Under what conditions will 

 rationalisation involve unemployment in (a) a single industry (b) in all 

 industries taken together ? Or, is there some inherent ' principle of 



* Pol. Economy, Appendix Note B on Machinery, p. 56. 

 •^ Political Economy in Ency. Metropolitana, 1850, p. 166. 



