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work, the cost of labour in America for most of the goods pro-duced, especially by means of Centralised Industry, was lower thanin the competing industries of Europe .
The opposite view is held by numerous practical Germans .According to the opinion of many of these, the sudden and con-siderable increase of wages which took place at the beginning ofthe “seventies” has by no means resulted in economical progress. Onmany sides was the view defended, in the press as well asin the Reichstag , that these increased wages represented aweakening of German industry compared with foreign, and a cur-tailment of exports. Far from the increase of wages being accom-panied by a corresponding raising of labour capacity, they hadrather in most cases caused a diminution in the work accomplished.This view was taken, for instance, by the Prussian Minister ofCommerce, in a Rescript of 28th March, 1876, to the head MiningDepartments (39). The same view is expressed in the “Memoir ofthe Association of German Iron and Steel Employers” whichappeared in 1875 (40), and in the Government inquiries concerningthe Iron Trade, as well as the Cotton and Linen Industries, in1878 (41), herein with special confirmation by German ironmastersand some spinners. As a means for raising the labour capacity itis recommended, in the Rescript above quoted, to lower the rateof piecework, by which the most effectual incentive for -workwould be given—advice similar to that of A. Young and thosewriters of the last century mentioned along with him. If wehie to the agricultural East of Germany , the teaching of the con-trary relation between height of wages and labour capacity wouldmeet with few doubters.
We have, therefore, to record a variation between the oldertheory and the younger, and also between practical men ofdifferent countries. Is it possible that one of the two sides is alonecorrect—the other simply wrong? Such an assumption is for-bidden by the abundance of undoubted facts with which each ofthe two views is justified by its adherents. Rather is the varianceonly to be solved by accepting it as the result of development.One must accept that the theoretical view, from Sir William Petty
30. Compare Brentano: “On the Relation of Wages and Hours of
Labour to the Work Accomplished” (Leipzig, 187G), pp. G-7.
40. Berlin : Printing Office of the “ Berliner Borsenzeitung,” p. 21.
41. In the original the author, in his foot-note, gives the pages and ques-tions here referred to.