THE PROBLEM OF PROFITS 153

successful business men do form, however, an important
part of the attraction which brings in competitors for these
gains. In this sense they are an important feature in
influencing the supply of capable men available for undertaking
 the control of business enterprises, new and old.
With regard to the earnings of managers of business, the
considerations adduced in relation to some special classes of
ordinary labour apply in a special degree. At any instant,
the supply of such ability available may be either abundant
or scarce relative to the occasions for its profitable exercise.
The remuneration of the individual is much of the nature of
rent. But the amount of the remuneration can and does
react on the supply, so that it is a quasi-rent, not a true rent,
with which we have to deal in this case.
Looked at as a rent, the remuneration of the entrepreneur
may afford some further useful reflections. Rents are, in
their nature, differential payments, The capable entre-Preneur
 reaps a reward corresponding to his superiority over
less capable men with whom he is in competition. He does
not secure his gains at the expense of labour or of capital.
If he gets the use of capital on better terms, it is because of
the lower risk associated with his control than with that of
Others who pay a higher rate. So far from hiring labour at
2 lower rate than struggling competitors, the conspicuously
Successful entrepreneur often pays somewhat higher wages,
and quite commonly gives more favourable conditions of
tmployment, than the less successful men can give. So far
as the gains of the highly remunerated entrepreneur exceed
those of the less successful, they are certainly not secured by
enforcing harder terms on labour than labour secures from
these rivals, A plea often acknowledged as valid by workmen
 is that their employer is barely able to hold on, and
Unable to give higher wages, or even unable to continue
eXisting rates. The obviously struggling employer, in a
Small way of business, meets with the sympathy of wage-®arners,
 though he does not give better terms to his
®mployees than his more successful competitors give. .
An important question is, What degree of competence is
Necessary to maintain a place in the ranks of employers?