ons with his
managers, whatever income he might get would be purely an
_entrepreneur's_ profit. It would not be interest--for that amount
would have to be paid to the men who had loaned the capital--and it
would not be wages--for they would have to be made over to the men
actually doing the work. The absent _entrepreneur_ would be, in the
eye of the law, the purchaser of all the elements which go into the
product, since all the purchases are made in his name. The managers
are only his agents, and when they buy raw materials or supplies for
the mill, they buy them for him and by his authority, and he is under
the obligation to pay for them. Moreover paying wages is, in reality,
buying the share which labor contributes to the product of the mill.
The workmen have a natural right to the value which their work, _of
itself and aside from the aid furnished by others_, imparts to the
material that is put into their hands, and when they sell their labor,
they are really selling their part of the product of the mill. In like
manner paying interest is buying the share which capital contributes
to the product. The owners of the capital have an original right to
what the machines, the tools, the buildings, the land, and the raw
materials, of themselves _and apart from other contributions_, put
into the joint product. In reality they sell this share for a
consideration in the form of interest. In a static state labor and
capital together create the whole product of the mill; wages and
interest are the prices that they get for their several
contributions, and the _entrepreneur_ pays these purchase prices and
by virtue of this becomes the owner of the whole product. Having the
product, he sells it in the market for what he can get. If this were
more than the cost to him of all the elements that have gone into it,
he would have a net profit remaining. It would be a remainder accruing
to the owner and seller of the product after the costs of getting a
title to it have been defrayed. Whether the absent _entrepreneur_ of
our illustration gets anything from his business or not depends on the
question whether such a remainder of returns above costs is afforded.

_Profits Nil in a Static Society._--We shall see that if labor and
capital can move about in the system of groups so freely that each
agent is as productive in one place as it is in another, there will be
no product anywhere in excess of wages and interest. Labor and capital
then c