64

A TREATISE ON MONEY

BK. II

grounds for stabilising the price of wheat or the priceof electrical power or the price of gold. In thiscase the answer must depend on whether, in the givencircumstances of a particular economic society, it isbetter that changes in the efficiency of human effortshould be reflected in changed money-earnings or inchanged money-prices.

(iv.) Working Class Index -Numbers

Corresponding to the Consumption Standard andthe Earnings Standard for the community as a whole,we have the (so-called) Cost-of-Living Index-Numberand the Wages Index-Number for the Working Class ,the ratio between the two furnishing an index of EealWages. These Working Class Index -Numbers arepractically important, because the necessary statisticsare more easily obtained than the corresponding figuresfor the community as a whole, with the result that it isthese index-numbers which have been actually com-piled.

For this reason it is sometimes convenient to usethe working class cost-of-living index-number as afirst approximation to the Consumption Standard, towhich it generally lies much nearer than does theWholesale Standard—provided we remember that itis limited, not merely to the consumption of theworking class, but to a part only of the consumptionof that class, namely to the necessaries pertaining tothe established standard of life. It would be naturalto employ it as a component part of any ConsumptionStandard. It is now currently compiled for mostcountries and, while its basis is not revised frequentlyenough, there is a considerable accumulated experienceof the statistical and practical difficulties involvedand the best means of overcoming them. It is, how-ever, so familiar and well understood as to need nofurther comment.