Page:The Economics of Unemployment.djvu/91

viz. that it reduces costs of production, by asserting that such wage reduction will be attended by a more than corresponding fall in efficiency and productivity of labour. But 'the economy of high wages' has never been held to be of universal and unlimited application. Its strongest case has been against the definitely 'sweated' industries, whose wages have been inadequate to sustain the worker in effective health and physical strength. Relatively high wages and standards of consumption are admittedly necessary, in the physiological sense, to sustain the output of great and continuous muscular or nervous energy in hard and taxing occupations. Nor can conventional elements of class comfort and psychological factors of personal dignity and aspiration be ignored in exploring 'the economy of high wages.' But it will be urged with some force that this economy has definite limitations. It will generally be admitted that a sudden or rapid large increase in wage-rates is not normally accompanied at once by increased efficiency and productivity of labour. On the contrary, its early effect is often detrimental. The growing of new wholesome needs and satisfactions in a standard of living is often a slow process. Sudden new increments of income are seldom put to the best uses by any class of recipients. Hence a sudden considerable rise of wage-rates may and often does mean either that fewer days are worked, or that more money is spent in ways detrimental to efficiency, or at any rate in ways not conducive to higher efficiency. In process of time the higher wage-income may be assimilated in a better family standard of living, conducive