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was still operating in many respects under the law of increasing, rather than the law of decreasing, returns. This suggestion is interesting, since it has usually been supposed that increasing returns cease at an early stage of agriculture. Certainly increasing intensity of cultivation in an industry subject to increasing cost, in the face of falling prices, seems to be an economic paradox which will require careful statistical investigation for its solution.
In connection with the question of incidence, it is shown that the amount of the burden cannot be calculated from average prices, since goods are imported at daily or hourly, not at monthly or yearly, prices; and the inland price is always higher by at least the full amount of the duty, when and where the commodity is actually imported. The tax on fodder grains is also reflected in higher prices for animals and animal products, which materially increase the burden of the grain duties.
The answer to the question, who profited by the duties, is sought by comparing the sizes of farms and types of farming. Very small farms produce insufficient grain for use on the place; wine, stock-raising, dairy and similar districts are likewise interested in cheap rather than dear grain. Only large landowners, and chiefly those in the districts eastward of the Elbe, profited from the grain duties. The same conclusion is reached by an examination of land values, since it appears that large farms have increased in value nearly twice as rapidly as small farms. As to the social distribution of the burden, it evidently varied directly with the number of children in a family and inversely with the income, since the smaller the income the larger is the proportion of it spent for food.
In seeking to determine whether German agriculture became more or less able to compete with foreign countries, as a result of the duties, the author reaches a curious conclusion. The expenses of production comprise four items. Taxes on agriculture, he finds are lower in Germany than abroad; indeed, the landlord gets more back from the state in various forms than he pays. Wages are no higher than in Russia, when efficiency is taken into account. Interest is lower than in most other countries. There remains only land itself; wherefore the author concludes that the real and only reason why the German farmer could not compete in 1878 was the high price of land. The grain duties, moreover, have further raised the price of land, thus establishing a vicious circle. Whoever sold land profited largely but whoever bought or rented
it was heavily burdened, especially as good crops in a protected country normally cause a violent fall in grain prices. This conclusion the author thinks is not in conflict with the doctrine of rent because he does not maintain that high land values affect the price of grain, but merely that they affect the cost of producing grain in the protected country. In this effect of high priced land he finds the explanation of the continual distress of the agricultural interest in England during the corn law period. It would seem that the author's logic at this point is inconclusive. He has not shown how, if debts rise as fast as land values, and expenses of production as fast as grain prices, it is possible for a protective tariff to increase land values; nor does he undertake to explain how land values can affect the cost of production without also affecting the prices of the product. There would thus appear to be a serious confusion in the author's theory of value.
The increase of the grain tariff in 1887 was followed by retaliation abroad and bad harvests at home which together led to famine prices. Caprivi accordingly reduced the rate in 1891, from 5 to 3.50 m. In 1902, however, the tariff on wheat was again raised to 5.50 m., on rye and oats to 5 m. and on malting barley to 4 m. The reduction of 1891 was soon largely neutralized, (in 1894) by abolishing the proof of identity previously required when imported grain was re-exported. Thereafter any one exporting grain received a certificate authorizing the importation, duty free, of the same amount of grain within six months. These certificates were transferable and after 1902 were good for any kind of grain. The system obviously acted as a premium on exports, since it now became profitable to export whenever any grain was selling in Germany for less than the world price plus the full import duty. As a result, the prices of all grains were raised by substantially the full amount of the duty, at all seasons and in all parts of the country. The instability of price due to the variation of supply in favorable and unfavorable years was thus largely overcome; but the German consumer also ceased to enjoy the benefit of good crops in Germany. German grain, in fact, could thenceforth be bought cheaper abroad than at home. A considerable export trade in rye consequently arose, causing a serious loss of revenue to the government and a corresponding increase of food prices in Germany.
At present the author estimates that the duties on the four chief grains cost the consumers 19.91 marks per capita annually,
of which only 2.45 marks go to the state, the remainder (17.46 m.) being a tax levied on 81 per cent of the population for the benefit of the other 19 per cent. The state consequently finds increasing difficulty in meeting its growing needs. Moreover, in spite of the rye exports, the duties have failed to render Germany self-supporting, since a third of the wheat and two fifths of the barley-altogether enough to feed the nation 52.6 days each year -must be imported. Meantime wages have not risen in proportion, and in some industries, notably mining, have risen little if at all. Finally, the sums thus wrung from the people have given rise to a huge land speculation in the eastern grain-growing provinces, over half the estates having changed hands from 19031907, while prices have doubled and tripled in a few years. Thus (the author holds) is medieval forced labor reëstablished in a modern form, for the enrichment of the few at the expense of the
Several defects have been noted in the foregoing discussion. Another of a more general character is the mixture of methods which makes both history and analysis difficult to follow. The elasticity of the demand for wheat is also calculated on the basis of Gregory King's formula, without any attempt at verification. Again, this formula indicates that the Bismarckian duties possibly depressed the world price 4 per cent, but the author argues that this depression was temporary, because the elasticity of demand would soon take it up. The elasticity of demand, however, had already been allowed for in King's formula. Finally, considerable space is occupied by personal polemics of slight general interest.
Despite these limitations, however, the work is of decided interest and value in relation not only to tariffs, but also to agricultural economics. It is the only fairly adequate summary of the existing and widely scattered literature on German agricultural protection. As such it is of special significance in view of present conditions and tendencies in the United States, and would serve a useful purpose if translated and carefully edited.
University of Minnesota.
EDWARD VAN DYKE ROBINSON.
Вонм, Н. Zölle und Steuern in schlands. (Munich: F. Gais.
der Praxis der Eisenbahnen Deut1911. 1.30 m.)
BOLDT, W. Das Reichssumachssteuergesetz vom 14. II. 1911. (Berlin: Heymann. 1911. Pp. vii, 171. 2 m.)
DERNBURG, B. Kapital and Staatsaufsicht. Eine finanz-politische Studie. (Berlin: Mittler and Son. 1911.)
EHEBERG, K. T. v. Finanzwissenschaft. 11th edition, enlarged. (Leipzig: A. Deichert Nachf. 1911. Pp. viii, 604. 8.80 m.) ESCARRA, E. Les modifications apportées à l'income-tax par le finance act de 1909-1910. (Paris: Giard et Brière. 1911. Pp. 24. fr.) JONES, R. Our taxes as they are and as they ought to be. Fabian Society's Tract, No. 152. (London: Fabian Society. 1911. 2d.) KEMPIM, W. Grundlagen, Mangel und Wirkungen der Reichs-Wertzuwachssteuer nach der Gesetzesvorlage in Beratung für Bürger, Mieter, Hauseigentümer, Handwerker und Beamte erklärt. (Leipzig: O. Klemm. 1911. Pp. 46. 1 m.)
LEVY, H. Die treibenden Kräfte der englischen Schutzzollbewegung. (Berlin: Simion. 1911. 1 m.)
MULLER, F. Das Wertzumachsteuergesetz vom 14. II. 1911. (Cologne: J. B. Bachem. 1911. Pp. 48. .80 m.)
POUPART, H. La revision des tarifs douaniers et les coalisations des producteurs. (Paris: Larose et Tenin. 1911. 1 fr.) ROBERTSON, J. M. The collapse of tariff reform. Mr. Chamberlain's case exposed. (London: Cobden Club. Pp. 119. 1s.) Roy, G. Corvée, prestation, taxe vicinale. Etude historique, économique et critique sur l'impôt des prestations. (Paris: A. Rousseau. Pp. 282. 4 fr.)
STIER-SOMLO. Zuwachsteuergesetz vom 14. II. 1911. Kommentar. (Nuremberg: U. E. Sebald. 1911. Pp. viii, 190. 4.80 m.) WAGNER, A. Finanzwissenschaft. Part III. Second edition. Steuergeschichte vom Altertum bis zur Gegenwart. (Leipzig: C. F. Wintersche Verlagshandlung. 1910. 10 m.) WEHBERG, H. A. Theodor Stamm und die Anfänge der deutschen Bodenreformbewegung. (Bonn: C. Georgi. 1911. Pp. 67. 2 m.) Non-taxable incomes; a book of important information for investors. Third edition. (Canton, O.: The Geiger-Jones Co. 1911.)
Social Problems and Reforms
Homestead: the Households of a Mill Town. By MARGARET F. BYINGTON. The Pittsburgh Survey. Russell Sage Foundation. (New York: Charities Publication Committee. 1910. Pp. xv, 292. $1.50.)
As one of the Pittsburgh Survey series, this volume needs no
extended introduction. It is an attempt to appraise the wages received by men in the Pittsburgh steel district-to learn what the wages can buy and what they actually do buy. The budgetary study involved in this undertaking was carried on not in Pittsburgh, with its complex industrial and social conditions, but in Homestead, where the settings are comparatively simple. Here in a small city, with no factory opportunities whatever for women, and very few for the men outside of the Carnegie steel plant, Miss Byington pursued her investigations between October, 1907 and April, 1908.
The book falls logically into two parts-one a study of Homestead as a town, socially, politically and economically, with a description of its relations to the mill that dominates the place; the other a budgetary study of ninety Homestead families, of from four to eight weeks. It is in the first of these that the chief interest and value of the work lie. As a picture of conditions in a small industrial center, it offers valuable material for the civic student and worker. Miss Byington writes in a descriptive vein that well portrays a town controlled economically by absentee managers and directors, politically by sordid or ignorant bossism, and socially by no one-a city without leadership. As a budget study the book is far from successful. An inkling of this is found in the editorial foreword by Paul U. Kellogg, director of the survey, who admits the "rather obvious statistical shortcomings" of the data, and emphasizes rather the gravity of the civic and economic problems discussed by the author. One could almost wish that the budgetary investigation had been condensed in favor of the municipal study, for it would then have been possible to present the latter in more orderly and effective form.
In the budget work, ninety families were studied, of whom a quarter were colored-a proportion far above the proportion of negroes in the town or mill. The other main groups are classed as Slav (a term which for convenience is loosely used to include Slovak, Hungarian, Lithuanian, etc.), English-speaking European (which curiously enough includes Germans), and native white. Although a considerable number of tables are presented, showing the various expenditures by racial and weekly expenditure groups, the number of families in any one group is so small that crossclassification is impossible. Even without cross-classification, averages are sometimes based on so small a number of families that they are far from dependable. The period studied was too short