Page:The New International Encyclopædia 1st ed. v. 20.djvu/290

* "WAECHTER. 238 WAGES. luch des romisch-deutsclien Sfrafreclits (1825- 26) ; Gemeines Reclit Deutschlands (184-t) ; Bei- triige zur deutschen Geschichie (1845) ; Pandek- ten (1880-81) ; and Deiitschrs Strafrecht (1881). Consult his Lite by his son Oscar (Leipzig, 1881). WAFER ASH. See Hop-Tbee. WAGER (from OF. iixiger, guager, gager, Fr. gager, to pledge, wager, from ilL. tcadiare, to pledge, from wadium. vadium, pledge, from Goth. «-<K?t, OHG. weti, wetti, Ger. 'Wette, AS. icedd, obsolete Eng. iced, pledge: connected with Lat. vas. surety, bail, Lith. vadiiti, to redeem, ran- som, and probably with Gk. &eeov, aethlon,S.eov, athlon, prize of contest). A promise or agree- ment to pay money or transfer property to an- other upon the happening or determination of an uncertain event. The promise is given in con- sideration of the payment of money or transfer of property by the oiJher party to the wager, or a promise on his part to pay money or transfer property if the event fails' to happen or if it happens in a particular manner specified by the agreement. The uncertainty of the event may arise either because it has not happened or l)e- cause it is not known to the parties to the wager. Thus a wager may be made as to the outcome of n race which has not taken place or a wager may be made as to the weight or size of an ex- isting object, the only uncertainty being in the knowledge of the parties to the wager. It will thus be seen that many common forms of com- mercial contracts are technically wagers. Thus contracts of insurance, contracts dealing in "fu- tures' in stocks or any commodity, are strictly speaking wagers. At early common law wager- ing contracts were held to be valid unless they involved some element in addition to the wager which rendered them contrary to public policy and therefore illegal. There have been numerous statutes also af- fecting wasers in the form of commercial con- tracts. The act of 7 Geo. II., c. 8, made illegal all wagers upon the price of stocks by agree- ments "to pay differences,' that is, to settle a contract for the sale of stocks for future delivery by paying the difference between the contract and niarket prices on the dale of delivery. This statute was subsequently repealed. For further consideration of the subject, see the titles Gambli:<g: Betting; etc. WAGER POLICY. In insurance law, a pol- icy covering a risk on a person in whom, or property in which^ the insured has no financial interest' of dependency, technically known as an- insnrahlc interest. Such policies are void by the old English common law, and also by virtue of statutes in England, and in the United States where similar statutes have not I)een enacted, the English law is held to be a part of their common law and applied to such cases. The English in- surance companies insure the life of the sovereign for the l)enefit of tradesmen, however, on the theory that the death of the former would cause a dej)ression in trade and ciinseqvieul loss to (he latter; but this is very near to the border line of speculative insurance. See Insurance, and consult the authorities there cited. WAGES. The reward of economic labor, i.e. exertion systematically directed toward the creation of goods or utilities. Popular usage tends to limit the application of the term to the earnings of hired labor, and frequently the mean- ing of the term is still further restricted so as to exclude the earnings of professional labor, such earnings being known as fees, honoraria, sal- aries, etc. Economic writers make no distinction between the rewards for the dift'erent classes of services, a prima donna's income being regarded as wages just as the income of the day laborer. Furthermore, economists treat as wages a part of the income of a man who works with his own instruments of production, as, for example, a small farmer. The same thing is true of a part of the "profit' of the entrepreneur who performs the routine work of management. In this sense of the term wages are contrasted with interest (q.v. ). rent (q.v.), and profit (q.v.). The four incomes, taken together, make up the whole of the social dividend. XoMix.^L AKD Real Wages. Wages are most frequently paid in money; but sometimes they are paid partially in goods, privileges and ad- vantages which possess a definite money value. In domestic service, for example, the money val- ue of board, lodging, etc., must be added to actual money payments to give the true wage. Wages thus expressed in terms of money are called nom- inal wages. To estimate the true welfare of the laborer, given the rate of nominal wages, it is necessary to take into account the purchasing power of money. Nominal wages, reduced to terms of purchasing power, are termed real uriges. The importance of the distinction be- comes apparent when one attempts to compare the position of labor in different countries. Dif- ferences in money wages signify nothing, unless we are able to estimate differences in the pur- chasing power of money. The distinction is even more important in historical study. The nominal annual wages of a hind in the thirteenth century, according to Thorold Rogers, amounted to 35s. Sd.. less than one-twentieth of the nominal wages of agricultural labor in modern England (£3n in 1801. according to the British Labor Commis- sion). It is certain that real wages have not increased in anything like the same proportion. The Theory of Wages. The earliest school of scientific economists, the Physiocrats (q.v.). taught that wages naturally afl'ord the laborer no more than a bare subsistence. The competi- tion of laborers and the strategic advantage of the employer, it was believed, made this result inevitable. Adam Smith advanced a similar view, admitting, however, that in societies in which wealth is increasing wages may exceed the mini- nuim of subsistence. The effect of ]Ialthus's Essay on Population was to confirm the view that wages are naturally limited to mere sub- sistence. The alleged tendency of population to outrun subsistence appeared to demonstrate con- clusively that any tenqiorary rise in wages above the necessary mininuim would soon be overcome by increase in population. Kieardo held in the main a similar view. bit he admitted that the comforts to which a laboring class had become accustomed could not be withdrawn without a slackening in increase of ixijnilation. The natu- ral price of labor llieardo delincs as "that price which is necessary to enable the laborers, one with another, to subsist, and to perpetuate their race, without either increase or diminution." This theory was adopted by the Socialists as a correct explanation of wages under a capitalistic regime.