among a large number of producers, it was thought, would fix a natural price automatically. Legislators directed their efforts to maintaining competition, even in the railroad business. This general reign of competition, at first unregulated and later regulated, may be taken to characterize the first phase of the industrial era.

Within the last two or three decades a new movement has been taking place. The marked concentration of production in large establishments, commonly called the trust movement, may be regarded as a second phase of the industrial AGRICULTURAL IMPLEMENTS 1

stage. It is seen in almost every line of production, although less markedly in some than in others. It is to be observed least of all in the farming and mercantile business. To illustrate the movement, we may take the manufacture of agricultural implements. From the above table

1 Twelfth Census Reports, "Manufactures," Pt. I, P. lxxii.

we notice an absolute decrease in the number, and a marked increase in the average size, of the establishments.

But a third phase, quite distinct from the preceding, has been attracting attention recently. It is the movement toward the integration of allied industries. For illustration, take the case of the United States Steel Corporation. Here we have united under one management the American Bridge Company, the American Sheet Steel Company, the American Steel Hoop Company, the American Steel and Wire Company, the American Tin Plate Company, the Federal Steel Company, the Lake Superior Consolidated Iron Mines, the National Steel Company, the National Tube Company, and the Carnegie Steel Company. Of the last itself, Mr. Charles M. Schwab says, in his testimony before the Industrial Commission (Vol. XIII, p. 448): "The Carnegie Company were large miners of ore mined all the ore that they required themselves, to the extent of over 4,000,000 tons per year. They transported a large percentage of it in their own boats over the lakes; they carried a large percentage of it over their own railroad to their Pittsburg works, and manufactured it there, by the various processes, into a great variety of iron and steel articles I think perhaps a larger general variety of steel articles than almost any other manufacturing concern."

Mr. W. F. Willoughby, in a recent article en

titled "The Integration of Industry," has given. the following additional illustrations: The combination of railroad and ocean transportation; the control by the Standard Oil Company of the Linseed Oil Company, which itself controls the National Lead Company; the consolidation of various lines of tobacco manufacture; the combining of production and distribution at retail by the large shoe companies; trust and security companies which perform the functions of banks, administrators of estates, real estate agents, guardians of valuables, bonding agencies, and conveyancers of property; the department store (although slightly different in principle); and finally, the English Coöperative Societies. The force at work, this writer thinks, is the same as that which impels a nation to become self-contained. This whole matter brings us to the heart of present problems, and is further discussed in Chapter V of Part I.

What the industrial age means in the way of increased facilities for the production of wealth is well shown by the elaborate investigation conducted by the United States Commissioner of Labor2 in regard to the difference between hand labor and machine labor. For example, in 1852 the printing and folding of 480,000 pages of newspaper required 3660 hours of work at a labor cost of $447, while in 1896 the same amount of work was done in 18 hours and 30.3 minutes at a labor

1 In the Quarterly Journal of Economics, Vol. XVI, p. 94.
2 In his Thirteenth Annual Report.

cost of $6.27. Agriculture is one of the latest branches of industry to be invaded by machine methods, but the progress made in this direction is also remarkable. So early as 1851, Mr. Pusey, in his Report on Agricultural Implements in the Exhibition of 1851, estimated that in the twelve years preceding his report "a saving on outgoings or else an increase of incomings of not less than onehalf" had resulted from the increased use of mechanical implements in agriculture.1 The investigation just mentioned shows still more rapid improvement since that time. For example, to

produce 40 bushels of corn in 1855 required 38 hours and 45 minutes of work at a labor cost of $3.63; while in 1894 that amount could be produced by 15 hours and 7.8 minutes of work at a labor cost of only $1.51. Whether human wellbeing has on the whole increased in the same proportions may be doubted, but after taking into account all of the evils the new industrial system has brought, there is without doubt a large balance in its favor, with unbounded possibilities for the future.

So far we have been viewing the development of society from the standpoint of production. Other viewpoints are of course possible. One writer has taken as his principle of classification the length of time which elapses between the production and the consumption of the goods, and

1 Quoted in Hearn's "Plutology," London, 1864, p. 172.
2 Bücher, "Industrial Evolution," p. 89.

from this standpoint he gets the following three stages:

1. The stage of independent economy.

2. The stage of town economy.

3. The stage of national economy.

The stage of domestic independent production is that in which the household is an independent group, a well-nigh self-sufficient economic group. Goods are produced in and by the household group, and are consumed by this group. Economic selfsufficiency is the ideal. This stage existed in classical Greece, and is found in all earlier industrial civilizations. The stage of town economy is that in which handicrafts are developed. Goods are produced by artisans for customers, so that the producer meets the consumer without intermediaries. The village shoemaker taking orders from individual customers and making their shoes for them is a type of this stage. Exchange takes place and commerce exists, but on a comparatively simple scale. The economic relations among men are relatively few and simple. In the stage of national economy, production is conducted on a large scale, and the goods pass through several hands before they reach the consumer. We are now in this stage; and, one may add, the next stage, according to this view, would be world economy. The business world is becoming more and more cosmopolitan. The industrial ties binding nations together are becoming closer. The money market is truly