produces, it is evident that, when any saving of expense takes place in
the production of that article, if the labourer still receives the same
cost of production as before, he must receive an increased quantity, in
the very same ratio in which the productive power of capital has been
increased. But, if so, the outlay of the capitalist will bear exactly
the same proportion to the return as it did before; and profits will not
rise.

The variations, therefore, in the rate of profits, and those in the cost
of production of wages, go hand in hand, and are inseparable. Mr.
Ricardo's principle, that profits cannot rise unless wages fall, is
strictly true, if by low wages be meant not merely wages which are the
produce of a smaller quantity of labour, but wages which are produced at
less cost, reckoning labour and previous profits together. But the
interpretation which some economists have put upon Mr. Ricardo's
doctrine, when they explain it to mean that profits depend upon the
proportion which the labourers collectively receive of the aggregate
produce, will not hold at all; for that, in our first example, remained
the same, and yet profits rose.

The only expression of the law of profits, which seems to be correct,
is, that they depend upon the cost of production of wages. This must be
received as the ultimate principle.

From this may be deduced all the corollaries which Mr. Ricardo and
others have drawn from his theory of profits as expounded by himself.
The cost of production of the wages of one labourer for a year, is the
result of two concurrent elements or factors,--viz., 1st, the quantity
of commodities which the state of the labour market affords to him;
2ndly, the cost of production of each of those commodities. It follows,