To this it may be replied, that though possibly he may employ no more labour in his own business when wages are lower, yet if he does not, the same amount of capital will be no longer required to carry on his operations; and as he will not be willing to leave the balance unemployed, he will invest it in some other manner, perhaps in a joint stock company, or in public securities, where it will either be itself expended in employing labour, or will liberate some other person's capital to be so expended, and the whole of the wages-fund will be paying wages as before.

But is there such a thing as a wages-fund, in the sense here implied?

Exists there any fixed amount which, and neither more nor less than which, is destined to be expended in wages?

Of course there is an impassable limit to the amount which can be so expended; it cannot exceed the aggregate means of the employing classes.

It cannot come up to those means; for the employers have also to maintain themselves and their families. But, short of this limit, it is not, in any sense of the word, a fixed amount.

In the common theory, the order of ideas is this. The capitalist's pecuniary means consist of two parts -- his capital, and his profits or income. His capital is what he starts with at the beginning of the year, or when he commences some round of business operations: his income he does not receive until the end of the year, or until the round of operations is completed.

His capital, except such part as is fixed in buildings and machinery, or laid out in materials, is what he has got to pay wages with. He cannot pay them out of his income, for he has not yet received it. When he does receive it, he may lay by a portion to add to his capital, and as such it will become part of next year's wages-fund, but has nothing to do with this year's.

This distinction, however, between the relation of the capitalist to his capital, and his relation to his income, is wholly imaginary. He starts at the commencement with the whole of his accumulated means, all of which is potentially capital: and out of this he advances his personal and family expenses, exactly as he advances the wages of his labourers. He of course intends to pay back the advance out of his profits when he receives them; and he does pay it back day by day, as he does all the rest of his advances; for it needs scarcely be observed that his profit is made as his transactions go on, and not at Christmas or Midsummer, when he balances his books. His own income, then, so far as it is used and expended, is advanced from his capital and replaced from the returns, pari passu with the wages he pays.