PROBLEMS OF DISTRIBUTION 223 
wages and the general well-being of the wage 
earning classes. 
We may take it as commonly allowed in 
these days that the workers have generally 
benefited in income from the capitalisation of 
industry ; but it is not always recognised how 
exactly the benefit has come about. The 
correct view of the relation between wages 
and capital is certainly this, that as capital 
increases wages must tend to rise. One might 
at first, perhaps, hesitate about subscribing 
to this doctrine, because one might feel dis 
posed to contend that the introduction of 
more capital displaces labour—that is to say 
that satisfying the demand for productive 
agents with capital weakens the demand for 
labour, capital and labour being largely alter 
natives. Such an argument would be sound 
were it a fact that the quantity of things 
demanded, tangible and intangible, was abso 
lutely fixed in amount. In that case, the 
advent of labour-saving appliances would 
throw men out of work, and the out-of-works, 
by competing with those left in employment, 
would bring down the rate of wages. But 
this effect could never be met with in the long 
run, because, when the price of a thing is 
reduced in consequence of an improvement in 
the method of making it, more of the thing is