taking precautions to prevent them from becoming acquainted with it, he must also add to the price at which he could otherwise sell the article, some small increase to cover the risk of such an occurrence. If an establishment consist of several branches which can only be carried on jointly, as, for instance, of iron mines, blast furnaces, and a colliery, in which there are distinct classes of workmen, it becomes necessary to keep on hand a larger stock of materials than would be required, if it were certain that no combinations would arise.
Suppose, for instance, the colliers were to "strike" for an advance of wages;—unless there was a stock of coal above-ground, the furnaces must be stopped, and the miners also would be thrown out of employ. Now the cost of keeping a stock of iron ore, or of coals above-ground, is just the same as that of keeping in a drawer, unemployed, its value in money, (except, indeed, that the coal suffers a small deterioration by exposure to the elements.) The interest of this sum must, therefore, be considered as the price of an insurance against the risk of combination amongst the workmen; and it must, so far as it goes, increase the price of the manufactured article, and, consequently, limit the demand which would otherwise exist for it. But every circumstance which tends to limit the demand, is injurious to the workmen; because the wider the demand, the less it is exposed to fluctuation.
The effect to which we have alluded, is by no means a theoretical conclusion; the proprietors of one establishment in the iron trade, within the author's knowledge, think it expedient always to keep above-ground a supply of coal for six months, which
