produces, he is punished by loss. Manufacturers are punished in the same way, when they produce a new commodity for which there is no demand, and when they produce a larger quantity of a saleable article, than is wanted. Over-production is always followed by loss to the producers, which makes manufacturers, farmers, and producers of all kinds, very careful not to overproduce. When, however, the production of any commodity is not enough to meet the demand for it, and large profits are being made out of the high prices the people are then obliged to pay, the gain causes more to be produced, until the supply is equal to the demand. Thus under-production, is removed by the competition for gain. In this manner, all producers, whose business it is to supply the wants of the people, are punished by their losses, when they produce what the people do not want, and are rewarded by their profits, when they produce just what they do want. In this way it is, that the supply of and the demand for all commodities, are kept equal, or as nearly so as can be. It is a part of every producer's business, to know how the supply and demand stand, or, as it is often called, "the state of the market," and to produce according to it. Producers who remain ignorant of this or who do not attend to it, are not fit to be producers, and they are soon driven out of the market, by being driven out of their business by their losses. LESSON 66.-DIFFERENT PRICES OF THE SAME COMMODITY.-Part 3. THE supply of most things, depends chiefly on the state of the weather, the nature of the soil, the extent of natural stores, and other conditions or circumstances in nature. It is on the first two of these circumstances, that our supply of wheat, potatoes, fruit, cotton, and other vegetable productions chiefly depends. Our supply of wool, silk, skins, fish, and indeed all animal substances, will be found to depend chiefly on some natural circumstance or the other, if we only take the trouble to find out just how we get them. So also will our supply of all mineral substances, such as black-lead, salt, coal, and all the metals. In the next place, the supply of commodities depends on the amount of industry, knowledge, skill, and economy, possessed by the producers. It is easy to see that our supply of wheat, and all other farm produce, besides depending on the state of the weather, and the nature of the soil, must also depend on the knowledge and skill of the farmer. Our supply of the metals, and of minerals of all kinds, must also very greatly depend on the skill of the miner. The supply of most things, depends very much on the character of the producers. Lastly, the supply of commodities, depends also on the demand for them. As we have already read, manufacturers, and all other producers, try to keep the supply of their commodities equal to the demand; they increase or decrease the supply, as the demand increases or decreases. on From this we learn that the supply of things depends Natural circumstances. The character of the producers. And now we speak of the DEMAND. The demand for any commodity, depends very much on its usefulness, beauty, curiosity, or any other quality, that makes things desirable; the demand for it, depends very much on its desirableness. This is why there is a much greater demand for iron than for lead, for paper than for parchment, for steel pens than for quills, and for coloured cloth than for white. Another very important thing that limits the demand for every commodity is, its price. Of two things that are equally desirable on account of their qualities, there is always a greater demand for the cheaper. It is only the high price of linen, that causes the demand for it to be less than the demand for calico. If linen were much cheaper than it is, there would be a greater demand for it, whereas if it were dearer, the demand would be less than it is. This is easily understood, and every one will at once see, that it is only the higher price of gold watches, that causes the demand for them to be less than that for silver watches; and that nothing but the higher price of cloth jackets, causes the demand for them to be less than the demand for fustian jackets, among poor people. Enough has been said to show that the demand for commodities depends on Their desirableness, and Their price. Supposing the price of a commodity to remain the same, an increase in its desirableness, would cause an increase in the demand for it; while a decrease in its desirableness, would cause the demand to fall off. Supposing the desirableness of a commodity to remain the same, a decrease in its price, would cause an increase in the demand for it; while an increase in the price, would cause a decrease in the demand. This is always found to be the case; manufacturers always find that by cheapening their goods, they increase the demand for them, and thereby sell larger quantities. But when from any cause they are obliged to raise the price of their goods, the demand always decreases; for the increase in price obliges some to do without altogether, and causes most who use them, to use less. A large increase in the price of stockings and shoes, would cause many more children to go barefooted; while a large decrease in their price, would enable many to have them, who cannot now afford them. From the lessons on price, we have learnt the following truths. The price of everything depends on the cost of production, and on the supply and demand. The differences between the prices of different commodities, are owing to the differences between their costs of production. The alterations in the prices of commodities, are caused by variations in the supply and demand, and in the cost of production. The supply of and the demand for commodities, are kept equal, because over-production is checked by loss, and under-production is removed by the competition for gain. The SUPPLY of commodities depends on Natural circumstances. The character of the producers, and The DEMAND for commodities depends on Their price. LESSON 67.—WAGES-THE PRICE OF LABOUR. Part 1. ANY payment for labour may be called the price of labour, no matter when or how the payment is made. Some persons are paid for their labour by the week, and the money each gets is called his wage. Others are paid by the year, and the payment made by the year is called a salary. Others, again, are paid neither by the week nor year, but for a particular amount of labour, the payment for which is called a fee. Smiths, masons, carpenters, printers, porters, and all such persons, receive wages. Ministers, teachers, clerks, and shopmen, receive salaries. Physicians, surgeons, lawyers, and musicians, receive fees. But no matter by what name the payment for a person's labour is called, it is still its price, and, like the price of everything else, depends on something; to show what that something is, we will begin by taking the case of a man who is a surgeon, and see what causes him to get the Į rice he does for his labour. Before he became a surgeon he was sent to a good school, where his father paid £50 a year at least, for six years perhaps, which, with books and other expenses, must have cost £400. After leaving school, he went to a college for about four years, which must have cost £400 more. After that, he most likely went to live with some surgeon for a year or two, to be more thoroughly instructed in surgery. This must have cost quite £200 more, so that altogether the cost of making him a surgeon could not well have been less than £1000. But this was not the only cost: there was the cost of years of very hard study, and much anxious thought. Altogether, you see, the cost of making him a surgeon was very great; and because it was, he now puts a high price on his labour to repay this cost, just as the manufacturer puts a high price on his goods, to repay the large cost of production. If the cost of producing a surgeon were not so great as it is, people would not have to pay him as much as they do; so you see the price of a surgeon's labour depends on the cost of its production. For the same reason, physicians, lawyers, and others, who have to pay large sums of money, and to study hard to learn their professions, are well paid for what they do; to be able to perform their labour costs a great deal, and that causes them to put a high price on it. The cost of production of labour is the cost of being able to perform it—that is, the cost of performing it. The cost of performing,-remembering that cost does not here mean the money cost only, but the cost of time, trouble, etc.,—means the same as the difficulty of performing. Therefore, the cost of production of labour is the same thing as the difficulty of performing it. Understanding this, we see that the high price of the |