also be the price at which the ordinary supply will be sold. Should it be possible to dispose of the surplus at a price other than that at which the ordinary supply finds a market, without, in fact, disturbing the price received for the ordinary supply, the loss which producers would suffer from the fall in the price of their whole output may be diminished or entirely obviated. In this case the surplus supply would, from the point of view of the ordinary market, be as if non-existent.

What is stated above may be more briefly expressed by saying that the effect on price of a surplus of supply is entirely dependent on the elasticity of demand of the particular commodity in question. This elasticity of demand is of course very closely connected with the possibility of substituting the commodity in question for other commodities, or vice versa, according as the relative prices show opportunity for advantageous substitution, or not.

=

If y be the price at which a quantity x of the commodity can find purchasers, the equation xyc is that of a demand curve showing at every point an elasticity of demand equal to ʼn [see Marshall, Principles, mathemat. App. note iii.]. Such a demand implies that, as a result of a small fall in the price, the amount demanded increases by an amount varying inversely as the (n+1)th power of the price. To reduce the price by one-half, the supply must be multiplied by 2". If n= =1 we have the case of a constant outlay demand, in which the amount spent on the commodity is the same at all prices; every fall in price results in a proportionate increase of the amount bought. The absolute increase of amount bought varies inversely as the square of the price, or, which is the same thing for this case, directly as the square of the amount previously bought.

In the general case, the percentage decrease of price consequent on a given small increase

1

of supply is th part of this percentage innt crease of supply, at all points on the demand curve at which the elasticity is n. If n be greater than unity, the total cost of a supply x increases with x. If n be less than unity, the total price obtainable for an enlarged supply falls short of that for which the smaller supply would sell, and the sellers would gain on the whole, by combining to destroy a part of their supply.

The equation obtained by Jevons differs little, when x is not far from unity, from that of a demand curve in which the elasticity is constant and equal to throughout. The result of a given small percentage surplus of supply is a fall of price of double this percentage.

In general, then, the question of how great the fall of price will be which results from a given surplus of supply, is answered by obtain ing the measure of the elasticity of the demand

499

This is only

with the ordinary supply. strictly true for cases where the elasticity of demand is constant, but it is sufficiently near to the truth when the surplus is but a small percentage of the total supply. We may expect that demand curves in general will show varying elasticity. In that case, a surplus of supply which is more than a small percentage of the whole supply will cause a percentage fall of price greater or less than in the case of constant elasticity, according as the elasticity of demand is decreasing or is increasing as we pass from the point representing ordinary supply to the points representing supply in excess of the ordinary. Corresponding statements may be made for the case of deficient supply.

By

In what precedes, it is taken for granted that the surplus supply, be it great or small, is not held off the market, but disposed of in the existing conditions of demand. In so far as circumstances permit of retaining a store for anticipated higher prices, the fact of extra supply being available does not produce its full effect on the price of the market. being in reserve, in case prices should rise sufficiently, it limits the rise, but not being thrown on the market at all at prices below a definite figure, cannot depress prices beyond that point, at any rate if we exclude the influence of trade-connections, etc., influences tending to modify the effects of unfettered competition.

The word "surplus" has, in what precedes, been employed to designate all the excess of supply above the ordinary-a distinctly vague conception. The ideas on which the discussion has been based are those of a steady supply and a steady demand in a market with an equally steady price for the commodity. Into such a steady market is introduced the modifying influence of a growth of supply. The addition to the supply is what is here called "surplus." It cannot be said to be in excess of demand except on the hypothesis that the price do not fall. It is not "surplus" to the consumers who, at the reduced price, are able to obtain goods beyond their reach at previous prices. In one sense of the word, goods cannot be in excess, cannot be truly a surplus, so long as there remain any purposes to which these goods would be applied if they were free, but to which, having a cost price, they are not actually applied. In the more usual sense, however, any supply the disposal of which requires a reduction of price may be denominated a surplus supply. It may be observed that an enlarged supply would not, in this sense of the word, imply any "surplus," if it were accompanied by such a development of demand that the whole could be disposed of without any reduction of price below the customary level. In so using the word, agreement with the ordinary language of business is preserved (cp. arts. ELASTICITY; DEMAND).

A. W. F.

500

nor the old expedient of infanticide, is at our

SURVIVAL OF THE FITTEST. Natural selection, which tends to the preservation of creatures more adapted to the medium they have to live in, and to the disappearance of those less so, is, beyond doubt, a vera causa in the organic world. It leads, in general, to the physical improvement of breeds, and, if the general Darwinian hypothesis be correct, may be a real factor in the production of new species, though Darwin does not claim for it that it affords a complete explanation of their origin (see DARWINISM). Its consequences can be modified by human intervention, which may prefer, and therefore protect, weaker individuals or races among the lower animals; for it is obvious that qualities, such as gentleness and capacity for affection, which might render a creature less formidable, and therefore less successful, in a state of nature, may make it more useful and acceptable when domesticated or employed as an auxiliary of man.

In the case of man himself, as in that of other animals, there is a natural tendency to the survival of the physically soundest and strongest; and some theorists have not shrunk from carrying the Darwinist idea so far as to assert that it is desirable in the interest of society that the existence of the physically weak should not be prolonged by the care of their fellows, but that they should be allowed to disappear as "unfit." But, as has been well said, a great proportion of those to whom the world owes most would never have been considered in a physical point of view the strongest, and were not seldom among the weakest, whilst, on the other hand, many of the physically strongest could well have been spared. "Fitness" is relative to all the conditions; and physical advantages may be extremely important in some times and places, and of comparatively little account in others. In the more advanced stages of human development they are greatly outweighed by intellectual and moral superiority. Even in warfare, whilst the tall and muscular man formerly was the leader, it is now often a person of comparatively feeble frame, to whom nature has given a resolute spirit and a genius for command. Another suggestion founded on Darwinian principles, and more plausible in character than that above referred to, has been made, namely, that those who are likely to transmit some form of disease or infirmity to their descendants should be prevented from marrying. The result at which this proposal aims is certainly desirable, if it could be attained by moral influence; and such influence might and ought to be used for the purpose; but to attempt to effect the object by coercion would be a proceeding at once tyrannical and ineffectual. Neither this sort of compulsion,

We

rendered impracticable by feelings which the progress of society has itself developed. must take the human material as supplied to us, and modify it as far as possible, in the public interest, by judicious treatment-by physical education and hygiene, and, in general, by better conditions of life.

When we consider the social, as distinguished from the physical, "struggle for life" (a Darwinian phrase which must not be taken as expressing, in this application, more than a half-truth), natural selection is, here too, a real agency. But it is a serious error to suppose that its operation is always beneficent. For, while the respectable elements in our natures sometimes lead to success, the lower and even the vicious ones do so also. Viewing contemporary life, if we use CARLYLE'S threefold scale of the vulpine, the beaver, or unmoral industrial, and the genuinely human qualities, we must admit that the first often have a large share in winning success and predominance. A steady and vigilant selfishness, a dogged refusal to acknowledge the claims of others wherever they can be disputed, and a constant endeavour after personal gain, will sometimes render a man "fit" for the medium he lives in, and assist him in improving his position. One who rudely elbows his way through a crowd will often make progress where a more modest person, with greater regard for others, will be retarded or altogether brought to a stop. As Huxley has said, "the creature that survives a free-fight only demonstrates his superior fitness for coping with free-fighters, not any other kind of superiority." Some who have not been able to sustain themselves in the stress of competition, but have succumbed to the pressure, though less "fit" for the struggle, may have been superior to the successful in all the higher elements of human character. Similar remarks will apply to cases in which success is won by dishonest arts, by mean compliances, by flattery of the wealthy or the powerful, by unworthy self-advertisement. Those who do not stoop to such expedients may be distanced in the race of life, but society is a loser by their failure. In the social sphere, as in the physical, judicious human intervention may do much to correct the evils which arise from the uncontrolled action of natural forces. Persons who, by intellectual gifts of the nobler order and by moral superiority, are really fitted to be useful, though likely to be crushed in the warfare of competition, may be rescued and sustained. And, by "artificial selection," those who for the welfare of society ought to fill positions of influence may be elevated to those positions, even when incapable of attaining success by energetic or politic selfseeking.

[Bagehot, Physics and Politics.-Bonar, Philos.

and Pol. Ec.-Ritchie, Darwinism and Politics.]

J. K. I.

SUSPENSE ACCOUNT. In bookkeeping an account sometimes raised for temporarily holding an item, whose final disposition is not yet settled.

R. W. B. SUSPENSION OF SPECIE PAYMENTS. One of the most important instances of a general suspension of cash payments was that which commenced in this country in 1797. The enormous expenditure abroad on our army and navy during the first years of the war against Napoleon, as well as the loans and subsidies granted to some continental states, caused a steady export of bullion (see DRAIN OF BULLION). An Order in Council was addressed to the Bank of England on 26th February 1797, requiring it to cease giving out cash in payment until the sense of Parliament could be ascertained. Soon after the meeting of Parliament an Act was passed (3rd May 1797), known as the Bank Restriction Act, requiring the Bank not to pay cash except for sums under 20s. This Act would have expired 24th June in the same year, but on 22nd June it was continued until the following session, and, in November 1797, another Act was passed extending the restriction until six months after the termination of the war. In consequence the note issues, both of the Bank of England and of the country bankers, were largely increased, and being inconvertible, caused gold to go to a premium. In 1800 the price of standard gold rose to £4:58. per ounce, and continued to fluctuate at more or less premium until 1819. In 1811 it was quoted at £4: 17: 6, and in 1814 as high as £5: 8s. per ounce. Conversely stated, the value of the £5 note was then at its lowest point, £3:10:10, being nearly 30 per cent discount.

Peace was finally concluded in November 1815, and the Restriction Act should have expired six months later, but it was continued till July 1816, 1818, and 1819 successively. In 1817 the Bank gave notice that it desired to pay certain of its notes in gold, but it was prevented from doing so by Parliament. In 1819 Resumption was provided for by Peel's Act (59 Geo. III. c. 49), which required the Bank to resume specie payments by stages, redeeming its notes in gold bullion at the following rates :

From 1st Feb. 1820 to 1st Oct. 1820 at £4:18. per oz. std.

From 1st Oct. 1820 to 1st May 1821 at £3: 19:6 per oz.

From 1st May 1821 to 1st May 1823 at £3:17:10, and thereafter in gold coin.

In 1821 the Bank obtained an Act, permitting it to pay all its notes under £5, which was done by payment in sovereigns, then first coined. In preparing for the resumption of specie payments the Bank found no difficulty whatever in accumulating an ample

501

No return

7,436,293

before

6,657,303

1,851,625

1814.

1,299,859

2,324,973

1792-1796 11,637,470 1797-1801 14,023,530 1802-1806 16,733,330 1807-1811 19,811,410 1812-1816 25,153,520 18,935,400 1817-1821 25,287,230 14,186,950 23,172,781 1822-1826 21,469,520 10,961,800 22,283,903 1827-1831 20,691,710 8,798,500 9,134,894

A general suspension of specie payments also took place in the United States at the time of the civil war. At the beginning of 1861 the paper currency consisted entirely of notes of the various banks amounting to about 40 millions sterling. The Acts of 17th July and 25th August 1861 authorised the issue of treasury notes, redeemable in coin on demand, but they were received with dislike. In December 1861 specie payments were suspended, and the issue of government legal-tender notes was authorised by act of 25th February 1862. Their amount rapidly increased, till, in 1865 the total of demand notes in circulation was about 150 millions sterling. Their value in gold as rapidly decreased, and in 1864 it fell to 35.1 cents per dollar, equal to a price for gold of 285 per cent. In 1866 the Treasury began to redeem them, at the rate of 4 million dollars per month, by cancelling them as received for taxes, but redemption was suspended by congress in 1868. The Act of 14th January 1875 provided for the resumption of specie payments, directing the cancelling of legal-tender notes to be continued, and requiring the secretary of the treasury to prepare and provide for their redemption in coin upon the 1st January 1879. For this purpose, besides using the surplus revenues, he was authorised to create and sell for coin interest-bearing bonds of the United States. Under these powers bonds for $90,000,000 (say £18,000,000) were sold, realising $95,500,000 (say £19,000,000). This amount was not applied in reducing the amount of legal tender-notes, because the Act of 31st May 1878 prohibited any further reduction, and required the treasurer to pay them out again after redemption. But the general resumption of specie payments was carried into

1864-285

1870-1231

1876-115

This

SÜSSMILCH, JOHANN PETER (1708-1767), was the author of the earliest works which can be described as "statistical" in the modern sense of the term. Süssmilch was a Prussian armychaplain who in 1742 published a remarkable book entitled: Die göttliche Ordnung in den Veränderungen des menschlichen Geschlechts, das ist gründlicher Beweis der Göttlichen Vorsehung und Vorsorge für das menschliche Geschlecht aus der Vergleichung der Geborenen und Gestorbenen, der Verheiratheten und Geborenen wie auch insonderheit aus dem beständigen Verhältniss der geborenen Knaben und Mädchen u. s. f. very long title was materially shortened in the next edition, which was not issued until 1761. The title then ran thus :-Die Göttliche Ordnung in den Veränderungen des menschlichen Geschlechts aus der Geburt, dem Tode, und der Fortpflanzung desselben erwiesen. The 4th edition (3 vols.) was printed in Halle and published in 1798 at the Realschule, Berlin, carefully edited and revised. Süssmilch's book deservedly won him high consideration among men of science, and also, which in those days did not necessarily follow, in the official world, for he became an Oberconsistorialrath and a member of the royal Prussian academy of sciences. Süssmilch was the first systematic student of "political arithmetic" (see ARITHMETIC, POLITICAL), as Sir William PETTY termed investigations into what are now known as "vital statistics," who was not satisfied with merely recording facts, but deduced general laws from them. This is no disparagement to his predecessors, for they had even less materials to work upon than Süssmilch. Such was the success of Die Göttliche Ordnung that it was not long before there arose a school of "mathematical" statisticians who perversely refused to admit that any elucidation of figures was needed, maintaining that they told all that was required. Süssmilch himself was really in advance of his time;

he was a shrewd man as well as a very

painstaking and learned one, and made excellent use of the imperfect materials at his disposal.

[Haushofer, Lehr- und Handbuch der Statistik, Vienna.-Maurice Block, Traité Théorique et Pratique de Statistique, Paris.-G. Mayr, Die Gesetzmässigkeit im Gesellschaftsleben, Munich.-Bonar, Malthus and his Work.] S., W. See W., S.

W. H.

SWAN, COLONEL JAMES (1754-1835), American merchant, politician, soldier, and author, helped to throw the tea-chests into Boston harbour, and was also aide-de-camp to General Warren at Bunker's Hill in 1775. In 1787 he left for France, a ruined man, but having speedily accumulated a fortune, returned in 1795 to his former associations in the States. His next thirty years were occupied in litigation, and the greater part in a Paris prison. In March 1830 his prosecutor died, and Swan was liberated. But he remained in Paris till his death. He published A Dissuasion to Great Britain and the Colonies from the Slave Trade to Africa (Boston, U.S.A., 1773, 8vo). In the opening dedication to the governor of Massachusetts, Swan describes himself as a "Scotsman." shows slavery to be derogatory to the spirit of Christianity, encouraging internal war among the African tribes, that the traders may buy the prisoners for slaves. He details the horrors of the slave-ships, points out the preferable economic advantages of amicable commercial relations with the negroes, and obtaining (pp. 31, 32), in return for our trifling wares, their ivory, gum, spices, and gold. If this were done he assures us that where British merchants "now export twenty shillings worth of commodities thither, they would then export an hundred pounds" (p. 32).

He

In An Address to the President, Senate, and House of Representatives of the United States, on the means of creating a National Paper by Loan Offices which shall replace that of the discredited Banks, and supersede the use of Gold and Silver (Boston, Mass., 1819, 8vo), Swan proposed that the United States should, on the credit of its 800,000,000 acres of unsold land of the value of

1,600,000,000 dollars, issue 150,000,000 dollars "in current bills, bearing interest at 3 per cent per annum.' "That amount," he continues (p. 9), would be so much the more solid since not a dollar "is not a tenth part of the capital, and that credit of these bills could be put into circulation but from loans made to individuals with three solvable signatures; or to merchants on the deposit of goods for sale; or to proprietors on mortgage of real estates with bonds of the borrowers; all these loans to be had on paying 6 per cent per annum, and as the current bills borrowed of Government bear 3 per cent interest, these loans would be really offered at 3 per cent interest instead of 6, the legal usage for money."

Swan also wrote and published National Arithmetic, by J. S. (1786, 8vo).-Causes qui se sont opposées aux progrès du commerce entre la France, et les Etats-Unis de l'Amérique, avec les moyens de l'accélérer. en six lettres adressées à M. le Marquis de La Fayette. Traduit sur le manuscrit anglais du Col. S., Paris, 1790, 12mo.-Courtes

SWANIMOTE. See FORESTS, MEDIEVAL. SWEATING. A term that has somewhat recently become naturalised in economic technology, but of which the precise signification is still uncertain. It was originally a slang expression, denoting a system of SUB-CONTRACT (q.v.) in certain industries, of which the clothing trade in all its branches is the most conspicuous, and was so applied by Charles KINGSLEY in his novel of Alton Locke, published 1849, and his tract Cheap Clothes and Nasty by Parson Lot, which made its appearance a little earlier. In the latter a definition of it is afforded in the following terms:-"Part of the work, if not the whole, is let out to contractors or middlemen sweaters, as their victims significantly call them, who, in their turn, let it out again, sometimes to the workmen, sometimes to fresh middlemen; so that out of the price paid for labour on each article, not only the workmen, but the sweater, and perhaps the sweater's sweater, and a third, and a fourth, and a fifth, have to draw their profit." This definition agrees with one furnished nearly half a century later, in an elaborate report on the sweating system of Chicago, forming Part II. of the report of the bureau of labour statistics of Illinois (1892), where the whole matter is dealt with at length, and most intelligently. In the opinion of the writer of this report, the “sweating system is one of respectable antiquity, and is a surviving remnant of the industrial system which preceded the factory system, when industry was chiefly conducted on the piece-price plan in small shops or the homes of the workers. ... In practice, sweating consists, he says, of the farming out, by competing manufacturers to competing contractors of the material for garments, which in turn is distributed among competing men and women to be made up. The middleman, or contractor, is the sweater (though he may also be himself subjected to pressure from above), and his employés are the sweated or oppressed. He contracts to make up certain garments at a given price per piece, and then hires other people to do the work at a less price. His profit, it is pointed out, "lies in the difference between the two prices" (pp. 357, 358). On the other hand, these definitions do not agree with the conclusions arrived at by a special committee of the House of Lords, appointed in 1888 to investigate the same subject. After an exhaustive enquiry, this committee reported that sub-contracting was not synonymous, or even conterminous, with sweating. The middleman is "the consequence, not the cause, of the evil"; and is "absent in many cases in which the evils complained of abound” (vol. v.

503

par. 181). The sweating system may exist under any method of employment, when "the conditions of the labour market afford abundant materials to supply an unscrupulous employer with workers helplessly dependent on him" (185). "In some cases the man known as a sweater is merely an agent, knowing nothing of the business. Sometimes he acts the part of a foreman, and directs the work of every branch, understanding the whole business thoroughly. Sometimes he works as hard as any of his employés" (par. vii.). Their definition of sweating is, "taking advantage of the necessities of the poorer and more helpless classes of workers" (171); or, "grinding the faces of the poor,' -as still more compendiously expressed by a prominent witness, Mr. Arnold White (par. 172).

These quotations reveal a fundamental difference of opinion on the part of two competent authorities, speaking from either hemisphere, and it is to be remarked in addition that no English political economist, or historian of eminence, has ventured yet to make any specific use of this term. In Mr. Howell's Conflicts of Capital and Labour, it occurs but once (p. 114), the passage being little more than the incorporation of another from Mr. Brentano's History and Development of Gilds (p. 129) referring to the repeal of 5 Eliz. c. 4 (in 1814), the "immediate consequence of which," this writer says, was "such a growth of the system of sweaters and half-pay apprentices, that the journeymen were driven to famine, and the female workers to prostitution." It is in fact a very unfortunate term in more ways than one and were better perhaps discarded altogether where scientific accuracy is aimed at.

Such as it is, however, and regarding its use in the limited sense of having a direct relation with sub-contracting, in which it seems to have originated, there are, according to the American authority referred to, two principal modes in which the sweater operates: "he will furnish shop-room and machines to some, and allow others, usually the finishers, to take the work to their living and lodgingrooms in tenements." Some remarks on the former of these modes of industry will be found under the heading TOOL RENT; the latter is one that has from time to time aroused public attention and sympathy, both at home and abroad, ever since the inquiry of the Second Children's Employment Commission (1862-66), if not earlier; and which, under the name of Home Work, was again (1894) a prominent subject of controversy in view of the grave evils still found to be associated with it. It is obviously an exceedingly difficult matter to deal with. On the one hand, it would certainly seem a highly arbitrary and oppressive act to forbid, or even attempt to regulate very strictly this work; on the other, it is truthfully argued