Economic Development Reduces the Real Price of Manufactures

²⁴⁰ Improvement naturally reduces the real price of nearly all manufactures gradually.

The price of all manufacturing workmanship gets reduced without exception.

Fewer labour is needed because of better machinery, dexterity, and division and distribution of work.

The real price of labour can rise very much in a flourishing society.

But the great reduction in the amount of labour will much more than compensate the greatest rise in its price.

²⁴¹ In a few manufactures, the rise in the real price of raw materials will more than offset all the advantages derived from improvements.

In the work of carpenters, joiners, and cabinet makers, the rise in the real price of timber from the improvement of land, will offset all the advantages from:

• the best machinery,
• dexterity, and
• division of work.

²⁴² But in all cases where the real price of raw materials rises very little, the price of manufactured commodities sink very much.

²⁴³ In the 17th and 18th centuries, this price reduction was most remarkable in manufactures that use the coarser metals. A watch in the mid-17th century priced at 800 shillings, may now be priced at 20 shillings.

There was also a very big price reduction in the following, but not as much:

• the work of cutlers and locksmiths,
• goods known as Birmingham and Sheffield-ware, and
• all the toys made of coarse metals.

It has astonished workers.

They are unable to produce a work of equal goodness by themselves for double the price.

The manufactures requiring coarse metals have the furthest division of labour.

Its machinery allows the most variations in improvements.

²⁴⁴ In the clothing manufactures, there was no sensible price reduction.

The price of superfine cloth has risen in proportion to its quality within the last 25-30 years.

This was caused by the rise in the price of Spanish wool.

The price of Yorkshire cloth made from English wool fell much relative to its quality in the 18th century.

Quality, however, is a very disputable matter.

I look on all information on quality as uncertain.

In the clothing manufactures, the division of labour is nearly the same now as it was a century ago.

The machinery employed is not very different.

Small improvements in division of labour and machinery may have reduced prices of clothes.

²⁴⁵ The reduction will appear more undeniable if we compare the price of present clothing with its price at the end of the 15th century.

Back then:

• labour was much less subdivided
• the machinery was more imperfect.

²⁴⁶ In 1487, it was enacted that a yard of the finest grained cloth sold above 192 pence will be fined 480 pence for every yard sold.

• 192 pence then had as much silver as 288 pence today.
• 192 pence was then a reasonable price for a yard of the finest cloth.

The law means that such cloth was sold dearer than 192 pence.

252 pence is currently the highest price of cloth.

The quality of of today’s finest cloths are much superior than before. But its money price was much reduced since the end of the 15th century. Its real price was much more reduced. 80 pence was then, and long afterwards, the average price of a quarter of wheat.

192 pence was the price of two quarters and more than three bushels of wheat.

Valuing a quarter of wheat presently at 336 pence, the real price of a yard of fine cloth back then must have been equal to at least 798 pence today. The man who bought fine cloth then must have paid the same real price [two quarters of wheat] as we pay now.

²⁴⁷ The big reduction in the real price of the coarse manufacture was not as great as the reduction in the real price of the fine manufactures.

²⁴⁸ In 1463, it was enacted that no servant in husbandry, common labourer, nor servant to any artificer living in a city shall use or wear any cloth above 24 pence per yard.

24 pence then contained nearly the same quantity of silver as 48 pence today.

But Yorkshire cloth, now sold at 48 pence per yard, is much superior to any clothes made then for the poorest servants.

Even the money price of their clothing may be cheaper today than then.

The real price is certainly much cheaper today.

• 10 pence was then the reasonable price of a bushel of wheat.
• 24 pence was the price of two bushels and near two pecks of wheat.

At 42 pence per bushel, it would be worth 105 pence today.

For a yard of this cloth, the poor servant must have paid what 105 pence would buy today.

This law restrains the extravagance of the poor.

The clothing of the poor was much more expensive then.

²⁴⁹ The same law prohibits the same poor servants from wearing hose priced above 14 pence a pair, equal to 28 pence today.

But 14 pence then was the price of a bushel and near two pecks of wheat.

At 42 pence the bushel, it would cost 63 pence today.

Presently, this is a very high price for a pair of stockings of the poorest servant.

But it was the common price back then.

²⁵⁰ At that time, the art of knitting stockings was probably unknown in Europe.

Their hose was made of common cloth, which may have been one of the causes of their dearness.

Queen Elizabeth was the first person to wear stockings in England.

She received them as a gift from the Spanish ambassador.

²⁵¹ The machinery in manufactures were much more imperfect back then.

It has since received three very capital improvements.

It is difficult to ascertain the number or importance of the many smaller improvements.

The 3 capital improvements are:

1. The exchange of the rock and spindle for the spinning-wheel

The spinning-wheel will perform more than double the work for the same quantity of labour

2. The use of machines which abridge the winding of worsted and woollen yarn or the proper arrangement of the warp and woof before they are put into the loom.

This arrangement was extremely tedious before those machines were invented.

3. The use of the fulling mill for thickening the cloth, instead of treading it in water.

Wind and water mills were unknown in England and north of the Alps in the start of the 16th century.

• They were introduced into Italy before then.

²⁵² These explain why the real price of manufactures was so much higher then than now.

It cost more labour then.

²⁵³ England’s coarse manufactures probably were:

• done as household manufactures, as in countries where arts and manufactures are new.
• performed by the members of private families.
  • It was only their work when they had nothing else to do.

It could not be the principal business from which they derived most of their subsistence.

This kind of work is always much cheaper than the work done by a worker who principally depended on it for subsistence.

The fine manufacture was then done in the rich, commercial country of Flanders, not in England.

It was probably done then by people who made their whole living from it, as we do today.

It was a foreign manufacture which must have paid some duty to the king.

This duty was probably not very great.

Back then, it was not the policy of Europe to restrain foreign manufactures by high import duties. Rather it encouraged them so that merchants could supply the great men with the luxuries they wanted.

²⁵⁴ These explain why the real price of the coarse manufacture in ancient times was, relative to the real price of fine manufactures, was so much lower than today.