Inequality from Wage ControlsJanuary 1, 2020
119 The ancient practice of setting wages by laws have now gone entirely into disuse.
120 Doctor Burns says=
121 Particular acts of parliament, however, still attempt to regulate wages.
The 8th of George the 3rd prohibits all master tailors in London and five miles round it, from giving more than 31.5 pence a day, except during a general mourning.
Whenever the legislature attempts to regulate the differences between masters and their workers, its counsellors are always the masters. When the regulation is in favour of the workers, it is always just and equitable. It is sometimes not just when it is in favour of the masters. The law which obliges masters to pay their workers in money and not in goods is just and equitable. It is in favour of the workers. It imposes no real hardship on the masters. It only obliges them to pay that value in money, which they pretended to pay in goods.
When masters combine to reduce wages, they commonly enter into a private agreement with certain penalties.
If workers enter into a contrary combination not to accept of a certain wage under a certain penalty, the law would punish them very severely. If the law was dealt impartially, it would also punish the masters in the same way. The 8th of George 3rd is in favour of the masters. It forces workers to accept a certain wage which masters attempt to establish by such combinations. The workers correctly complain that it puts the most industrious on the same footing as the ordinary worker.
122 In ancient times, it was usual to attempt to regulate the profits of merchants by rating prices.
The assize of bread is the only remnant of this ancient usage. Where there is an exclusive corporation, it might be proper to regulate the price of this necessity. When there is no corporation, the competition will regulate it much better than any assize. The 31st of George the 2nd fixed the assize of bread. It could not be done in Scotland because it depended on the office of clerk of the market which does not exist there. The 3rd of George the 3rd remedied this. The lack of an assize created no inconvenience nor advantage. In most Scottish towns, however, there are bakers’ corporations which are not very strictly guarded.
123 The proportion between wages and profit in different employments is not much affected by the advancing, stationary, or declining state of the society.
The changing state of society affects the general rates of wages and profit initially. But in the end, those changes affect the rates equally in all employments. Therefore the proportion between them must remain the same. It cannot be altered by such changes in the state of society, at least for any considerable time.