The price of labor, renumeration paid to employees for their work or services
  • Minimum Wage Laws - Legislation that places a lower limit on the prices paid for labor


UpdAn Essay on the Influence of a low Price of Corn on the Profits; shewing the Inexpediency of Restrictions on Importation: With Remarks on Mr Malthus' Two Last Publications, by David Ricardo, 1815
Ricardo criticizes Malthus, who had previously written "Observations on the Corn Laws" generally supportive of free trade, for his The Grounds of an Opinion on the Policy of Restricting the Importation of Foreign Corn
"The first of these causes is more or less permanent, according as the price from which wages fall, is more or less near that remuneration for labour, which is necessary to the actual subsistence of the labourer. The rise or fall of wages is common to all states of society, whether it be the stationary, the advancing, or the retrograde state. In the stationary state, it is regulated wholly by the increase or falling off of the population. In the advancing state, it depends on whether the capital or the population advance, at the more rapid course. In the retrograde state, it depends on whether population or capital decrease with the greater rapidity."
Related Topic: Free Trade
UpdCollected Works of Nassau William Senior, by Donald Rutherford (editor), 1998
"Introduction" chapter of subject book, includes biographical and bibliographical information
"The central concern of Senior in his discussions of wages was an exposition of the wages fund doctrine. ... If machinery is introduced, then there is a temporary reduction in the wages fund with fewer funds available for employing and paying workers but in the long run the general rate of wages will rise or remain the same ... Senior was keen to emphasize that wages are essentially the consequence of a bargain between employer and worker, each attending to his own welfare. Individual workers can improve their wages, measured in terms of the amount of commodities they can purchase, by working harder for longer hours."
How to Destroy Mongolian Mining, by Morgan J. Poliquin, Mises Daily, 20 Jun 2006
"Mongolian workers don't have the money to find and develop a mine and, like workers worldwide, accept wages in return for labor right away before, and regardless if, any sales or profits are realized by the capitalist investors. Ivanhoe estimated that over its life the project would provide 117,000 new jobs (full and part-time workers) ..."
Related Topics: Mining, Mongolia, Taxation
Of the Wages of Labour, by Adam Smith, The Wealth of Nations, 1776
Book One, Chapter VIII
"The produce of labour constitutes the natural recompence or wages of labour. In that original state of things, which precedes both the appropriation of land and the accumulation of stock, the whole produce of labour belongs to the labourer. He has neither landlord nor master to share with him. Had this state continued, the wages of labour would have augmented with all those improvements in its productive powers, to which the division of labour gives occasion. All things would gradually have become cheaper"
Ricardo, David (1772-1823), by Mark Skousen, The Encyclopedia of Libertarianism, 15 Aug 2008
Biographical essay
"... this abstract reasoning ... has been called the 'Ricardian Vice.' ... Ricardo created an oversimplified 'corn' model that led to an antagonistic view of capitalism, where values are determined by labor inputs and where wages can only increase at the expense of profits. His analysis of the nature of production concluded that wages tend toward subsistence levels, known as the iron law of wages. Ricardo thought that over time, as the population grew, an increased demand for food would have the natural effect of raising its price, which would lead to an increase in the value of labor."
Related Topic: David Ricardo
Teaching Basic Economics to Fifth Graders, by Arthur E. Foulkes, Mises Daily, 21 Jun 2006
Recounts the experience of teaching economics to fifth graders, one concept per week, for five weeks, focusing on trade, money, savings, competition and prices
"We found that the same rules that established prices for the goods in the auction would also establish salaries or wages for different careers. Demand for a labor service — acting on the available supply of people who can perform that service — will set the 'wage' for that service. Thus supply and demand, we found, could explain both the price of goods and the price of the human factors supplying those goods."
The Economic Role of Saving and Capital Goods, by Ludwig von Mises, The Freeman, Aug 1963
Explains there is a third factor of production aside from nature's resouces and human labor, and also that entrepreneurial judgement is necessary to attain the desired end of production
"There is no other method to make wage rates rise than by in­vesting more capital per worker. More investment of capital means: to give to the laborer more effi­cient tools. With the aid of better tools and machines, the quantity of the products increases and their quality improves. As the employer consequently will be in a position to obtain from the consumers more for what the employee has produced in one hour of work, he is able—and, by the competition of other employers, forced—to pay a higher price for the man's work."
The State Is No Friend of the Worker, by Sheldon Richman, 24 Oct 2014
Discusses how the state interferes with setting wage rates and quotes Thomas Hodgskin on how to reward workers properly
"The surest way to eliminate wage discrimination is to keep government from impeding the competitive process with such devices as occupational licensing, permits, minimum product standards, so-called intellectual property, zoning, and other land-use restrictions. ... Being able to tell a boss, 'Take this job and shove it,' because alternatives, including self-employment, are available, is an effective way to establish the true market value of one's labor in the marketplace."
Related Topic: Thomas Hodgskin
Wages, by Ludwig von Mises, Human Action, 1949
Chapter 21 "Work and Wages", section 3; discusses labor, wages, how are wages determined and erroneus attacks on that explanation
"Labor is a scarce factor of production. As such it is sold and bought on the market. The price paid for labor is included in the price allowed for the product or the services if the performer of the work is the seller of the product or the services. If bare labor is sold and bought as such, either by an entrepreneur engaged in production for sale or by a consumer eager to use the services rendered for his own consumption, the price paid is called wages."
Related Topics: Entrepreneurship, Labor


The Real "Truth About the Economy:" Have Wages Stagnated?, by Donald J. Boudreaux, 31 Jan 2012
Responds to Robert Reich's video "The Truth About the Economy" (13 Jun 2011) focusing on three points: measures of inflation, benefits other than wages and distinguishing between statistics and individuals