mething besides wages or any other
normal and legitimate income. If they accept for their time less than
they are worth, they make a donation to the corporation. Neither
filching something for nothing out of the returns of the corporation,
nor giving it a gratuity, is to be here assumed as existent, since we
are not dealing with the phenomena of quasi-plunder or eccentric
benevolence. The character of wages of management, as the reward for a
high grade of labor, is recognized in business life, and the salary
of the manager, whether he is a stockholder or not, is usually
expressed in a definite sum of money and is gauged, crudely or
accurately, according to his value as a servant of the company.

_Dividends often Composite._--In like manner it is important in the
bookkeeping of a company to ascertain how much of the return to the
stockholders is merely interest on the capital they have themselves
invested and how much is true profit, or the net gain which is over
and above interest. In business life a distinction is pretty clearly
maintained between the three kinds of income that have been described;
namely, the reward of labor in all its forms, the reward of capital,
going to whoever furnishes it, and the reward of a cooerdinating
function, or the function of hiring both labor and capital and getting
whatever their joint product is worth above the cost of the elements
which enter into it. This essentially commercial margin of returns
from production above all costs of production is profits in the strict
sense and would be nonexistent in an absolutely static industry. It
comes into existence in consequence of the changes with which social
Economic Dynamics deals.

_Three Incomes entirely Distinct._--Wages, interest, and profits,
then, are the three incomes that we shall distinguish. We shall keep
profits completely separated from the wages of any kind of labor and
from the interest on any kind of capital. This income falls to the
_entrepreneur_, otherwise called the undertaker, or the employer and
cooerdinator of labor and capital, and it comes only when the product
of the operations carried on in his establishment exceeds all wages
and all interest that he has to pay.

_How a Man could be an Entrepreneur Only._--If a man should hire all
the capital that he needs in a business and also all the labor,
including the labor of every man in the office force, and reside
thereafter in a distant country, holding no consultati