Disirihution of Profits. 41 



vious way is to pay the laborer wages, reserving to the proprietor 

 interest on the capital invested, salary ag business manager, wages 

 as far as he performs labor, and ihe profits, if there are any. In 

 many kinds of business it would be hard to introduce any system 

 of sharing the profits with the laborer. Thus in a printing office, 

 where the woikmen are constantly wandering from one office to 

 another, or on a farm wheie in harvest and threshing extra men 

 must be hired, or in a store where the amount of sales and the 

 net profits are both matters that often must be kept secret from 

 the public and from rivals, — in all these cases it would be bard 

 to introduce any system of giving the laborer a share either in 

 the proceeds or in the profits of the business. But where such a 

 system can be introduced it has obvious advantages over the sys- 

 tem of wages. It p.oduces a greater interest in the business on 

 the part of the laborer and therefore more faithful work and 

 greaier care to prevent was'e. It is the usual practice in the 

 great mercantile houses to give the best clerks a partnership, that 

 is, a share in the profits. The hope of this is a constant incentive 

 to the younger clerks, and the offer of a partnership prevents the 

 best clerks from carrying their customers to rival houses or set- 

 ting up in business for themselves'. 



CASE III. 



In this ca=e the capitalist employs the business manager and. 

 the laborer, giving them (a) wages or salary, (b) a share in the 

 profits or (c) a combination of the two. The capitalist takes in- 

 terest, and the net profits (or losses) of the business. In this case 

 the interest is concealed by the profits, but can be easily separated. 



Thus if a capitalist builds a woolen mill, and employs a super- 

 intendent and several laborers, he usually pays a salary to the 

 first and wages to the secoud. But he may give the bu>ine-:s man- 

 ager a share in the profits, thus virtually making him a partner. 

 Or he may make him formally a business partner, reserving the 

 title to the mill, and rent for it, to himself. Or he may give both 

 the superintendent and the hands a share in the profits. The usual 

 practice on a whaling sh'p is for the owner to receive one-half the 

 oil and whalebone, and for the other half to be divided among the 

 captain and crew, in so many "lays," or shares to each. 



