COLTON, REV. CALVIN, born in Massachusetts 1789, died in Georgia 1857. At first a Presbyterian clergyman, he soon entered the ministry of the Protestant Episcopal Church. This he relinquished for journalism, and in 1852 became professor of political economy at Trinity College, Hartford, Conn. He advocated very strongly the policy of protection to home industries, and was a devoted follower of Henry Clay. He wrote works on travel, and on religious and political subjects. Among his economic works are The Crisis of the Country, 1840.The Junius Tracts, 1843-44.-The Rights of Labour, New York, 1846, pp. 96; and a more extensive work, Public Economy for the United States, New York, 1848, pp. 536. He edited the works of Henry Clay, and in all his economic writings dwells principally upon the theme of protection.

D. R. D.

COLWELL, STEPHEN, born in Virginia 1800; entered on the practice of law in his native state; early removed to Pittsburg, and relinquished his profession to become an iron merchant in Philadelphia, where he lived the remainder of his life; died 1872. He devoted much time to the study of political economy, wrote largely for the periodicals of the day, and associated himself with the protective party. Among his more extended writings may be mentioned The Relative Position in our Industry of Foreign Commerce, Domestic Production, and Internal Trade, Philadelphia, 1850, 8vo, pp. 50; and an American edition of Frederick List's National System of Political Economy, Philadelphia, 1856, pp. 497, for which he wrote a preliminary essay, pp. lxxxiv. His best known work is The Ways and Means of Commercial Payment, Philadelphia, 1858, in which he attempts a full analysis of the credit system, with its various modes of adjustment; he argues that a mistake has been made in previous analyses in not making a radical distinction between money of the precious metals and forms of credit; the historical inquiry into the growth of the credit system is of considerable value, and the whole work exhibits independence of thought; he did not accept the view that the quantity of money is the controlling factor in determining prices. His other writings of economic interest are, The Claims of Labour, and their Precedence to the Claims of Free Trade, pp. 52, 1861.-Gold, Banks, and Taxation, pp. 68, 1864; and State and National Systems of Banks, Expansion of the Currency, the Advance of Gold, and the Defects of the Internal Revenue Bill of June 1864, 8vo, 1864. the close of the civil war in 1865 he was appointed a member of the revenue commission, and in 1866 made a valuable report on taxation. In this document Colwell's special reports are upon The Influence of Duplication of Taxes upon American Industry; upon Relations of Foreign Trade to Domestic Industry and Internal

At

335

purpose of controlling the production, exchange, and distribution of wealth, have assumed so many forms that it is only possible here to give an outline of the subject-the reader being referred to other pages for a detailed examination of each class.

I. PRODUCTION. Some forms of wealth can only be produced by the assistance of large capital, and in some industries production on a large scale is distinctly economical (Mill's Polit. Econ., bk. i. ch. ix.) Hence capitalists have united in various combinations recognised by law :

(1) Partnership. Where two or more persons agree to combine property, labour, or skill in business, and to share the profits between them.

(2) Company. Where a number of persons are incorporated into a company either under act of parliament or by charter from the crown, the liability of members being either limited or unlimited (see COMPANIES).

Combinations of producers have also been formed with the object of controlling the production of some one or more commodities so as to secure if possible a monopoly of production. The following types of this method may be mentioned::

(1) Pools. Where a joint committee of delegates from several producing establishments control the production (see Pools).

(2) Syndicates. Where one firm or company agrees to take all the produce of other firms in the same business at fixed prices: the amount of the produce being often limited by agreement. The copper syndicate formed by the Société Industrielle et Commerciale des Métaux de Paris is the most famous of this class.

(3) Trusts. Where the stockholders in several corporations transfer their shares to trustees, who become registered in their places as owners of the stock and so obtain complete control of the management. Usually the shareholders receive trust certificates in exchange for their shares. The complete legality of such a proceeding has been maintained (Polit. Sci. Quarterly, Dec. 1888), but in at least one American case it has been held that a corporation whose members enter into such a trust forfeits its corporate character (see TRUSTS).

Companies are sometimes formed with the object of establishing a monopoly of production, by buying up the business of all persons engaged in the trade. The Salt Union which

336

has purchased many of the salt properties in England and Ireland is an example of this class.

Various forms of combinations are found to exist between sellers and buyers :-

(1) Wholesale firms are frequently bound by agreement with their customers (retail dealers) not to sell except to retail firms.

The

(2) Distributors or intermediate dealers, often combine to buy at a low price from producers and to sell at a high price to consumers. milk exchange of New York bought milk at two to three and a half cents per quart and sold it as high as seven or ten cents.

(3) Combinations or agreements between seller and buyer that the latter will sell again only at a certain price are very numerous in America, though such agreements have been declared illegal.

In a separate class may be placed the combinations entered into by carrying companies either to secure if possible a monopoly of traffic or to prevent competition by agreeing on a scale of rates and charges.

[For examples of these various forms of combinations see Report of Committee of State of New York upon Trusts, 1888.-Report of Committee of Canadian House of Commons on Combinations regarding manufacture or sale of Products, 1888.-Quarterly Journal of Economics, 1889, Boston, vol. iii. No. 2.-Political Science Quarterly, 1888, New York, vol. iii. Nos. 2, 3.Sidgwick, Polit. Econ., bk. iii. ch. x., and Marshall, Principles of Economics, bk. v. ch. viii., discuss the theoretic aspects of monopolies.-Cournot's treatment of the abstract theory of monopoly (Recherches, ch. v. Du Monopole) has influenced most subsequent writers. Much light is thrown both on the theory and facts of the subject by the following: Hadley, Railway Transportation.-C. W. Baker, Monopolies and the People.]

II. DISTRIBUTION. In all the leading industries the employers and the employed have formed their respective associations for the protection of their own interests. The terms upon which the labourer is to give his services are not arranged by him and his employer individually, but by the respective associations to which they belong. Mill, regarding wages as paid out of capital, did not think that combinations of working men could raise wages without adding to capital; but more recent economists look on wages as a share of the produce, and admit that by combination wages may be raised (Sidgwick's Polit. Econ., bk. ii. ch. x.; Marshall's Economics of Industry, London, 1879; and The Principles of Economics, 1891; Walker on Wages. See TRADES UNIONS).

Combinations on the part of labourers to obtain higher wages or shorter hours of labour are not illegal, but it seems that a combination of tenants to obtain a reduction of rent may, under certain circumstances, amount to an illegal conspiracy.

III. PRODUCTION AND DISTRIBUTION.

In

order to avoid the conflicts that arise between employers and employed different forms of "profit sharing" have been tried with varying success, the employer agreeing to hand over to the workers, in addition to their wages, a share of the profits (see PROFIT SHARING).

IV. DISTRIBUTION AND CONSUMPTION. In order to secure to consumers the profits made by producers, various forms of co-operation have been introduced in which the capital is subscribed by the consumers. This idea has been specially successful in saving to the consumer the profits of the retail dealer by the establishment of co-operative stores, and there is a growing tendency to apply the same principle to actual production (see Co-OPERATION). J. E. C. M.

COMBINATION LAWS. The object of the series of statutes known as the combination laws was to enforce the provisions of the statutes of labourers of Edw. III. and of Elizabeth which authorised the justices in quarter sessions to fix wages.

One of the first acts, 3 Hen. VI.

c. 1, after reciting that the yearly confederacies of the masons tended to destroy the force of the statutes of labourers, enacted that such meetings should not be held under pain of imprisonment. In 1548 a more general statute was passed (2 & 3 Ed. VI. c. 15) which prohibited all conspiracies and covenants not to make or do their work but at a certain price, under penalty, on a third conviction, of the pillory and loss of an ear. In subsequent years the following acts relating to particular trades were passed prohibiting combinations for raising wages or reducing the hours of labour in the trade, viz. 7 Geo. I. c. 13 (journeymen tailors); 12 Geo. I. c. 34 (wool trade); 22 Geo. II. c. 27 (hatters); 17 Geo. III. c. 55 (silk weavers); and 36 Geo. III. c. 111 (paper trade).

In 1799 a general act was passed, but it was repealed and replaced in the following year by 40 Geo. III. c. 60, which prohibited all combinations for obtaining an advance in wages or lessening the hours of work. This act, says Mr. Justice Stephen (History of the Criminal Law of England, London, 1883, vol. iii. p. 208), "applies in the most detailed, specific, uncompromising way the principle upon which all the earlier legislation had depended. . . . I should not describe it as a system specially adapted and designed to protect freedom of trade. The only freedom for which it seems to me to have been specially solicitous is the freedom of the employers from coercion by their men."

The first attempt to modify this system of legislation was the 5 Geo. IV. c. 95, which repealed all the previous statutes so far as they related to combinations of workmen, and declared that persons joining combinations of workmen for obtaining an advance in wages or lessening the hours of labour, or for other specified purposes, should not be liable to any prosecution for

conspiracy. The act was considered to have encouraged combinations for objectionable purposes, and in the following year (1825) it was repealed and replaced by the 6 Geo. IV. c. 129. This new act, whilst it repealed the previous statutes, did not in express terms legalise combinations of workmen—the legality of such combinations was left to be dealt with by the common law it simply rendered men liable to punishment for the use of threats, intimidation, molestation, and obstruction directed towards the attainment of the objects of trade unions. A few alterations in the act were made by 22 Vict. c. 34. The recommendations of the royal commission of 1867 on trade unions led to the repeal of the 6 Geo. IV. c. 129, and the 22 Vict. c. 34, by the 38 & 39 Vict. c. 31, and the 38 & 39 Vict. c. 32, which declared that the purposes of a trade union were not to be deemed unlawful by reason merely that they were in restraint of trade, and carefully defined what acts should be deemed criminal offences. The protection afforded by these acts was greatly diminished by the gradual extension of the common law doctrine of conspiracy, and at length, in 1875, the act was repealed and replaced by the Conspiracy and Protection Act, 38 & 39 Vict. c. 86 (see CONSPIRACY, LAW OF).

[The following writings set forth the sequence and import of these laws: G. Howell, Handbook of the Labour Laws.-Jevons, State in Relation to Labour.-J. E. Davis, Labour and Labour Laws. - Report on Strikes and Lockouts of 1888 by the Labour Correspondent of the Board of Trade, Parliamentary Papers, 1889, C 5809.]

J. E. C. M.

COMFORT, STandard of. This expression, together with the synonymous "standard of living," has been generally employed by economists in connection with the question of POPULATION (q.v.) Among the "preventive remedies" of over-population described by MALTHUS (q.v.) in his essay is included "moral restraint," and this is defined (ch. ii.) | as a "restraint from marriage from prudential motives." By this is meant the fear of losing, as the consequence of entering upon the responsibilities of the married state, the command of adequate means of subsistence. The means, which will be regarded as adequate, will vary according to the conception formed by the individual, or the class to which he or she belongs, of the elements which make up subsistence; and it is this conception which is implied in the term "standard of comfort," or "standard of living." It may, therefore, vary from age to age, from country to country, from class to class, and even from individual to individual. The term may be analysed in different ways. We may regard the constituent elements of subsistence as consisting of (1) food, (2) clothes, (3) shelter, etc.; or we may, using a cross-division, consider with

337

Senior (Political Economy, p. 36) that the range of man's desires rises in an ascending scale from (1) necessaries to (2) decencies and (3) luxuries. And hence the term has sometimes been employed in a narrower, and sometimes in a wider sense. In an earlier and less advanced stage of civilisation the proportion assigned to the element of necessaries in the conception formed by classes and by individuals of their standard of comfort is greater than it is at a later stage, and among these necessaries the supply of food is accorded the most prominent place. And therefore the question of population has very generally been considered either solely or chiefly with reference to food, and it has also been argued by McCulloch and others that the habitual use of a cheap staple article of food by a nation may lead to inconvenience and danger, because in the event of a scarcity or famine of that food, there would be no cheaper food on which to fall back, and the standard of comfort would not permit of temporary contraction. It has been said that "you may take from an Englishman, but you cannot take from an Irishman." If a famine of wheat should occur, the Englishman could fall back on some cheaper food; but experience has shown more than once that the Irishman has nothing on which to fall back if the potato fails. But General Walker has pointed out (Wages Question, ch. vii.) that, so far as regards the temporary contraction of the standard of comfort, this argument does not appear to take sufficient account of the fact that there are other constituent elements of the standard besides food, and that therefore the habitual use of a cheap food may allow of greater expenditure in other directions, which may be curtailed, should food become scarce, and its price advance. similar failure to realise the elastic comprehensiveness of the term "standard of comfort" has been shown (cp. Sidgwick's Principles of Political Economy, bk. i. ch. vi. § 3) to attach to another line of reasoning in which it has been introduced. Modern socialist writers (see SOCIALISM), such as Rodbertus and Lassalle, have spoken of an "iron and cruel law" of wages, which is always forcing wages down to the level of a bare subsistence. For, if they rise above this level, there is a tendency to an increase of population, and the greater competition for employment, which is consequent upon this, tends in its turn to occasion a decline of wages. This law is undoubtedly based on the conception of a standard of living or comfort, which will be maintained in such a way that, if the earnings of man and woman rise above the amount sufficient to secure this standard, population will increase, and, if they fall below, it will decrease. But the conception is often, though it is not always, interpreted by socialist writers in a narrow sense as referring to the bare necessaries of life, and not more widely as

A

The

including its decencies and luxuries. It is used as if the standard of comfort were limited to physical needs, and did not comprehend moral requirements. As a matter of fact it consists of the necessaries, decencies, and luxuries of life; and the desire to retain command over the possession of the two last may become more powerful even than the want of the first as a restraint on the increase of population. nature of all three may undergo considerable change and exhibit great variety. The house, which would now be a decency in England, would have been thought a luxury two or three centuries ago. The clothes, which would be deemed extravagant to-day, except in theatrical performances, would then have been considered necessary articles of apparel. The tobacco, which is regarded as a decency in Turkey, is still perhaps a luxury in England, and the wine, which is a decency in England, is a prohibited luxury in Turkey. And so the standard of comfort varies in different ages, countries, and classes; and in the case of the lower as of the higher ranks of society it may advance from time to time. The origin of the socialist law of wages has been ascribed to RICARDO'S (q.v.) theory of the natural price of labour, but Ricardo's own language is sufficiently elastic and comprehensive. "It is not to be understood," he says (ch. v.) "that the natural price of labour, estimated even in food and necessaries, is absolutely fixed and constant. It varies at different times in the same country, and very materially differs in different countries. essentially depends on the habits and customs of the people." And again he remarks, "The friends of humanity cannot but wish that in all countries the labouring classes should have a taste for comforts and enjoyments, and that they should be stimulated by all legal means in their exertions to procure them." The effects of the standard of comfort on the movement of population are of course not immediate; and the consequences of an alteration in it take some time to make their influence felt. And hence J. S. Mill has argued (bk. ii. ch. xiii. § 4) that, "when the object is to raise the permanent condition of a people, small means do not merely produce small effects, they produce no effect at all. Unless comfort can be made as habitual to a whole generation as indigence is now, nothing is accomplished." In a similar way General Walker has shown (Wages Question, ch. iv.) that, if through some sudden mischance wages sustain a serious fall, a positive

It

degradation of labour may follow, and the labourer may have no power or strength to maintain his old standard of comfort without external assistance.

It should be noted that some ambiguity may arise regarding the unit selected for consideration in connection with the standard of comfort. The term may sometimes refer to

a single individual, whether male or female, and sometimes to a family as a whole. In the discussion of questions of population the conditions, which are necessary in order to maintain the requisite supply of labour, are generally present to the mind of the writer; and then the standard of comfort must be understood as referring to the family as the unit rather than the individual, for the wages of the labourers must be such as to enable them to live themselves, and to maintain their wives, and bring up their children, according to the standard of comfort, which they consider necessary for a family in their rank of life. But the earnings possibly of the wife, and possibly also of the children, may be called in to assist those of the man, and so from the point of view both of income and expenditure the family is treated as the unit. There are however, other cases in which shorter periods of time are in view than those sufficient to allow of the standard of comfort producing its full influence on the movement of population, and then the term is often employed with reference to the individual rather than the family. An example of this may be found in the comparison made between the earnings of men and of women (cp. FEMALES AND CHILDREN, EARNINGS OF; see also DAVIES, D.)

In addition to the books mentioned above, some typical budgets of working men, showing the chief items of their expenditure, and the proportionate amounts spent on the different items, have been compiled abroad, especially by Dr. Engel and M. Le Play, and more recently in our own country by the Board of Trade.

L. L. P.

COMMANDITE, SOCIÉTÉ EN. Form of joint stock company, Code de Commerce, liv. i. tit. iii. §§ 23-28. The managing partners are liable without limit; the investing partners are regarded as simple lenders to the undertaking, and their liability is limited to their investment. Something equivalent (joint-stock company limited, the liability of whose directors is unlimited) is legalised by the Companies Act 1867, §§ 4-8; and it would appear desirable in the interests of careful management that investors should encourage the adoption of this form of joint-stock company.

form.

A. D. COMMERCE. Trade in its most extended "Commerce" and "trade" are words which are used almost synonymously. But commerce may be regarded as national, that is as covering commercial dealings between nations; and trade refers more distinctly to special industries and to internal mercantile intercourse. It will therefore be proper, keeping to the limits thus set down, to furnish under the head of commerce a summary of the external commercial relations of Great Britain and Ireland, of her colonies, and finally of the world. The figures, as we shall see, are not only interesting

in themselves, but will serve to illustrate some economic truths as an appeal to actual fact alone is able to do. It is marvellous how the commerce of the world may almost be said to be the creation of the past seventy-five years. The close of the twenty-five years of war that followed the French Revolution found the external commerce of the world mainly confined to luxuries, wines and spirits, tobacco, tea, and so on-the rigidly protective policy of the leading nations of the earth, added to their hostility, keeping down the national interchanges to highpriced goods only.

In 1820, five years after the overthrow of the first Napoleon, the imports and exports combined (they were then "official values," not "declared values as we have them now) (see OFFICIAL and DECLARED VALUES) of the United Kingdom were only £79,500,000, or only about £3: 15s. per head of the population then existing, whereas in 1890 they reached £749,000,000, or £18: 6s. per head. During the same period the commercial intercourse between Great Britain and her colonies has been almost wholly created, and amongst foreign countries the movement is upon the average very considerable. Steam carriage, the freedom from protracted wars, the growth of population, colonisation, and electricity have been the main elements in that development of commerce. In 1854 the "official values" were discarded in the imports for computed values and in the exports for declared values, and from 1871 the values of the imports have also been declared. The following figures give the imports and exports at intervals since 1854 :

1855 £143,542,850 £95,688,085 £21,003,215 £116,691,300| 1860 210,530,873 135,891,227 28,630,124 164,521,351 1870 303,257,493 199,586,822 44,493,755 244,134,738 1880 411,229,565 223,060,446 63,354,020 286,414,466| 1885 370,967,955 213,044,500 58,359,194 271,403,694 1887 362,227,564 221,414,186 59,348,975 280,763,161 1890 420,885,695 263,531,585 64,349,091 $27,880,676|

The highest cash value of the imports was 1891, when they reached £435,691,279, and the highest value of the exports was 1890, when the total was £327,880,676, the latter but little in excess of the exports for 1872. Indeed, the vast increase indicated up to 1872 has since in a great measure been wanting, and total values have, with minor fluctuations, remained much upon the level of fifteen or twenty years back. But it is well worthy of remark that these are values only, and in nowise show the volume of merchandise moved. Now there have latterly been compiled many statistics to show that the prices of commodities have largely fallen since 1872, when measured by a gold

339

standard; and the tabular statistics supplied by Mr. R. H. Inglis Palgrave to the Royal Commission on the Depression in Trade in 1886 are conclusive on this point. It was therein shown that, as compared with 1865-69, prices in 1885 had fallen on the average 20 per cent, and as compared with 1872 the drop was as much as 30 per cent. From which it may be taken for granted indeed it is capable of proof-that this country's foreign commerce is in bulk upwards of 30 per cent larger than it was in 1872. Indirectly the shipping tonnage entered and cleared with cargoes at the ports of the United Kingdom is an illustration of this expansion.

Thus it is right to assume that notwithstanding values are, as already stated, not higher than those of 1872, owing to an exceptional depreciation in prices, the actual commercial intercourse of the United Kingdom has largely increased.

In 1890, 41 per cent of the imports consisted of food and drink, 30 per cent of raw materials (of which 21 per cent was for textile manufacture), 15 per cent of manufactured goods, 6 per cent of metals and minerals, 2 per cent of chemicals and dyeing materials, and 1 per cent of oils, leaving 3 per cent to be accounted for by a number of miscellaneous substances imported, including tobacco. In the same year, of the United Kingdom exports as much as 43 per cent consisted of textiles, including yarns, 23 per cent of metals and machinery, 7 per cent of coal, 4 per cent of apparel, 4 per cent of food and drink, 3 per cent of chemicals, etc., 1 per cent of earthenware, china, and glass, 1 per cent of paper, 1 per cent of leather, and nearly 1 per cent of arms, ammunition, etc., leaving 10 per cent These made up of miscellaneous manufactures. are the returns of merchandise imported and exported in 1890, but the precious metals are not included. In the same year the imports of gold reached £23,568,049, and the exports £14,306,688, while the imports of silver were £10,385,659, and the exports £10,890,384. Combined with the former the following contrast is presented :