The new industrial revolution and wages

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Monograph

Identifikator:: 1804651486

URN:: urn:nbn:de:zbw-retromon-193069

Document type:: Monograph

Author:: Lauck, William Jett http://d-nb.info/gnd/173237126

Title:: The new industrial revolution and wages

Place of publication:: New York

Publisher:: Funk & Wagnalls

Year of publication:: 1929

Scope:: ix, 308 S.; graph. Darst.

Digitisation:: 2022

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter VIII. Acceptance and general application of the theory of productive efficiency

Collection:: Economics Books

168 INDUSTRIAL REVOLUTION AND WAGES that low prices might also occur along with a high level of compensation to workmen. Prior to the war, however, these truths had received very little, if any, practical consideration and application. They had been recognized through the years, but their dis- cussion had been limited to academic circles. The first practical adoption of the theory as a working basis was made by Mr. Henry Ford in 1914. He was the pioneer of the new era as to wage theories, but it was years before in- dustry in general accepted his point of view. In establish- ing a $5.00 minimum day-wage in the Ford Motor Com- pany plants in the above-mentioned year, he pointed out that high wages could be paid and lower costs realized by a wider adoption of machines and machine processes, and if prices at the same time were lowered, sales would be stimu- lated by greater consumption. Under these conditions, profits per unit of output would decrease, but the aggre- gate of profits in money terms would increase. If this policy were extended to industry in general, he claimed, it would result in increasing general consumption and in plac- ing the country on an assured basis of prosperity. Industry in general, however, refused to change its tra- ditional attitude until long after the war, and, even then, only after the adoption of the policy of wage and price de- flation in 1921 had been found futile as a means of reviv- ing prostrate trade and industry. Conditions were altered only after such leaders as Herbert Hoover, Secretary of Commerce, Julian M. Barnes, President of the United States Chamber of Commerce, and many others, had pointed out the fallacy of cutting wages as a stimulus to prosperity or of attempting to return to the so-called “nor- malcy” of pre-war conditions as to wages and prices.! With the new idea once practically and officially sanc- 1 See pp. 79-83.

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