Improvement (economics)

“ If invention and improvement still go on, the efficiency of labor will be further increased, and the amount of labor and capital necessary to produce a given result further diminished. The same causes will lead to the utilization of this new gain in productive power for the production of more wealth; the margin of cultivation will be again extended, and rent will increase, both in proportion and amount, without any increase in wages and interest. ”

“ In what has preceded, I have, of course, spoken of inventions and improvements when generally diffused. It is hardly necessary to say that as long as an invention or an improvement is used by so few that they derive a special advantage from it, it does not, to the extent of this special advantage, affect the general distribution of wealth. ”

“ The gradual introduction of an improvement is important, since it affords time for an increase in the social demand for the product which is thus cheapened and for introducing at many other points improvements which neutralize, in a large degree, the labor-expelling effect of the first improvement.
(4) Technical gains are the largest source of additions to the total amount of the social capital. The constant influx of new capital facilitates the placing of laborers at the points where they are needed. ”

“ That the growth of population will overpass the increase of production, there is not much reason to apprehend. It is, however, quite possible that there might be a great progress in industrial [pg 477] improvement, and in the signs of what is commonly called national prosperity; a great increase of aggregate wealth, and even, in some respects, a better distribution of it ”

“ Of this increased security, one of the most unfailing effects is a great increase both of production and of accumulation. Industry and frugality can not exist where there is not a preponderant probability that those who labor and spare will be permitted to enjoy.
One of the changes which most infallibly attend the progress of modern society is, (3) an improvement in the business capacities of the general mass of mankind. I do not mean that the practical sagacity of an individual human being is greater than formerly. ”

“ But a decline in prices caused by greater economy and effectiveness in manufacture and greater skill and economy in distribution, in place of being a calamity, is a blessing and a benefit to all mankind."
With growing knowledge, and the advancement of the arts and sciences, there is a continual improvement in methods of production102 and distribution, enabling the same amount of labour to produce and distribute to consumers a far greater amount of commodities in general than it formerly could. ”

“ Now the extension of business which almost certainly follows in any department in which an improvement has been made, affords a strong inducement to those engaged in it to add to their capital; and hence, at the slow pace at which improvements are usually introduced, a great part of the capital which the improvement ultimately absorbs, is drawn from the increased profits and increased savings which it has itself called forth. ”

“ But there is a distinction to be made between industrial efficiency and business prosperity. Americans have hitherto identified prosperity with a furious economic activity, and an ever-increasing economic product—regardless of genuine economy of production and any proper distribution of the fruits. ”

“ Other parties have had no effort in bringing about the innovation, but they consider themselves partners in the industry, they know their leverage, and, thus, exploit it. Their advantage not only concerns the consequences of a better product, but also an improvement of their income position.
Model
In a general equilibrium framework we consider an economy with 400 units of labour and 600 units of capital. The economy produces food and clothing, and a social welfare function (SWF) determines the optimal combination. ”

“ There is no greater stimulus to the making of improvements than the certainty of reward to the person who first introduces one. The moment, however, that the improvement is imitated by all producers, the advantage gained by it becomes the common good of the whole nation.646 These are, as J. B. Say says, conquests made over the gratuitous productive force of nature. As a consequence, the value in use of a people's resources increases ”

“ If the improvement, which we suppose to take place, is not in the production of food, but of some manufactured article consumed by the labouring class, the effect on wages and profits will at first be the same ”

“ In addition to the improvement manifested in our staple articles of industry, other important interests are showing symptoms of decided improvement; even the iron-trade has got over its 'crisis;' and though we are very far indeed from having attained to a condition of prosperity, the steady, though slow, revival of every branch of industry, is a proof that the cause of the improvement must be a general one, operating universally. ”

“ The extent of their market, therefore, must for a long time be in proportion to the riches and populousness of that country, and consequently their improvement must always be posterior to the improvement of that country. ”

“ It is the natural effect of improvement, however, to diminish gradually the real price of almost all manufactures. That of the manufacturing workmanship diminishes, perhaps, in all of them without exception. ”

“ In manufactures, accordingly, the causes tending to increase the productiveness of industry, preponderate greatly over the one cause which tends to diminish it: and the increase of production, called forth by the progress of society, takes place, not at an increasing, but at a continually diminishing proportional cost. ”

“ Moreover, the results of efficiency methods, within the writer’s knowledge, are sufficient to convince him that their general adoption would so increase the purchasing power of the employe, by increasing his wages and decreasing the cost production, as to have a markedly beneficial and steadying effect upon the business of the country. ”

“ Has the progress of wealth and industry no effect in regard to cost of production, but to diminish it? Are no causes of an opposite character brought into operation by the same progress, sufficient in some cases not only to neutralize, but to overcome the former, and convert the descending movement of cost of production into an ascending movement? ”

“ The savings of labor which have fallen so largely into the hands of the few, making them rich men, have built our railroads, steamships, telegraphs, manufactories, thus in many ways adding to the means of production, and the facilities of commerce at home and abroad. These saved earnings in the hands of men seeking investment for profit have increased the wealth, resources, and refinements of civilization, made abundance possible, and brought it within reach of all, except the unfortunate, or the indolent and improvident. ”

“ If we don’t want growth, we can easily imagine a stagnant economy. That said, most economies aspire at a growth in welfare. We can do this by designing new products or by material investments or by creative ways to reorganise production. ”

“ As I said, we've got experts from a wide range of business sectors, and what we're going to talk about is, are there mechanisms that we can start putting in place where we see the kind of growth that used to characterize the U.S. economy -- export-driven growth, manufacturing growth, growth that pays high wages and provides high living standards for a broad-based middle class. ”

“ In the case of a more complicated manufacturing establishment, it should also be perfectly clear that the greatest permanent prosperity for the workman, coupled with the greatest prosperity for the employer, can be brought about only when the work of the establishment is done with the smallest combined expenditure of human effort, plus nature's resources, plus the cost for the use of capital in the shape of machines, buildings, etc. ”

“ Suppose that the improvement does not operate in the manner supposed does not enable a part of the labour previously employed on the land to be dispensed with but only enables the same labour to raise a greater produce. Suppose, too, that the greater produce, which by means of the improvement can be raised from the soil with the same labour, is all wanted, and will find purchasers. The improver will in that case require the same number of labourers as before, at the same wages. ”

“ Will the present standards of management, skill, workmanship and factory discipline be improved? Will the consumers benefit? Will people save? i. e. Will sufficient fresh capital be forthcoming for the further developments of industry? ”

“ Whatever merits it has consist in its possible ability to promote the national economic interest in a progressively improving general standard of living, in a higher standard of individual work, and in a general efficiency of labor. ”

“ Add to this the increase in business orders, which provides incentives to rebuild inventories, and the pickup of other economics abroad, and we see all the parts falling in place for a new surge of robust expansion. ”

“ Aiming at greater production, economy and efficiency, through their large means and modern improvements, than had been possible with small concerns, they marked a forward step in that progressive industrial, commercial and financial march which has created our vast national wealth and made this country the Wonder of the World. ”

“ There is great need, also, that the expense of living should be reduced while the standards of living shall not be lowered. The business world has been trying to secure economies in production; there is even greater need of economies in distribution. ”

“ The benefits of saving viewed broadly are not confined to the owner of the wealth saved, but are diffused throughout society, in the degree that they increase and improve the industrial environment, and thus raise the efficiency of production. ”

“ As has been said before, there are to be included in the improvements which increase the value of land not only the improvements which directly increase productive power, but also such improvements in government, manners and morals as indirectly increase it. Considered as material forces, the effect of all these is to increase productive power and, like improvements in the productive arts, their benefit is ultimately monopolized by the possessors of the land. ”

“ The fundamental basis for the maintenance of national standards of living is adequate production, economical distribution, and fair apportionment among the various economic groups which constitute our society. ”

“ The challenge of greater productivity growth is of supreme importance to America's future. Only through productivity gains can real living standards be improved. Greater productivity growth is the cornerstone of price stability and sustained economic growth. ”

“ Supposing, therefore, that the actual comforts of the labourer remain the same, profits will fall or rise, according as population, or improvements in the production of food and other necessaries, advance fastest. ”

“ The labourer may obtain greater comforts; wages in kind real wages may rise. Or the progress of population may force down cultivation to inferior soils, and more costly processes; thus raising the cost of production, the value, and the price, of the chief articles of the labourer's consumption. On either of these suppositions, the rate of profit will fall. ”

“ The efficiency of the new manufacturing processes has provided a large surplus of goods that must be taken somewhere, exchanged for food and raw materials, which must, in turn, be brought to the producers of manufactured goods. In the course of these transactions, a generous share of the values produced goes, in the form of profit, to the owners of the industry, another considerable portion goes into reinvestment, thus swelling the volume of productive capital.
The increased wealth, the larger capital and the greater amount of surplus all make possible the maintenance of a larger population. ”

“ Let it practice true and conscientious economy, not only in the expenditure and application of public moneys, but also in the method of levying them, so as to be equally just to all classes and all economical interests. ”

“ Finally, let me say that, if we must have cheap production, if we must have better organisation and make more and more use of machinery, if we must increase each man's output in order to meet the financial necessities of the immediate future, what method shall we adopt? ”

“ But above any other factor, and perhaps greater than all of them combined in contributing to the high maintenance efficiency attained in these countries must be placed the standard of living to which the industrial classes have been compelled to adjust themselves, combined with their remarkable industry and with the most intense economy they practice along every line of effort and of living. ”

“ And this third great party should be given its proper share of any gain. In fact, a glance at industrial history shows that in the end the whole people receive the greater part of the benefit coming from industrial improvements. In the past hundred years, for example, the greatest factor tending toward increasing the output, and thereby the prosperity of the civilized world, has been the introduction of machinery to replace hand labor. And without doubt the greatest gain through this change has come to the whole people—the consumer. ”

“ If, for instance, the general efficiency of all labour were increased, so that all things without exception could be produced in the same quantity as before with a smaller amount of labour, no trace of this general diminution of cost of production would show itself in the values of commodities. ”