and, for the sake of simplifying, let us further suppose the labour of each of these twelve persons to be worth two pounds a week.  One portion of their capital will be expended in procuring the tools necessary for their trade, which we shall take at L400, and this must be considered as their fixed capital.  The remaining L400 must be employed as circulating capital, in purchasing the iron with which their articles are made, in paying the rent of their workshops, and in supporting themselves and their families until some portion of it is replaced by the sale of the goods produced.

311.  Now the first question to be settled is, what proportion of the profit should be allowed for the use of capital, and what for skill and labour?  It does not seem possible to decide this question by any abstract reasoning:  if the capital supplied by each partner is equal, all difficulty will be removed; if otherwise, the proportion must be left to find its level, and will be discovered by experience; and it is probable that it will not fluctuate much.  Let us suppose it to be agreed that the capital of L800 shall receive the wages of one workman.  At the end of each week every workman is to receive one pound as wages, and one pound is to be divided amongst the owners of the capital.  After a few weeks the returns will begin to come in; and they will soon become nearly uniform.  Accurate accounts should be kept of every expense and of all the sales; and at the end of each week the profit should be divided.  A certain portion should be laid aside as a reserved fund, another portion for repair of the tools, and the remainder being divided into thirteen parts, one of these parts would be divided amongst the capitalists and one belong to each workman.  Thus each man would, in ordinary circumstances, make up his usual wages of two pounds weekly.  If the factory went on prosperously, the wages of the men would increase; if the sales fell off they would be diminished.  It is important that every person employed in the establishment, whatever might be the amount paid for his services, whether he act as labourer or porter, as the clerk who keeps the accounts, or as bookkeeper employed for a few hours once a week to superintend them, should receive one half of what his service is worth in fixed salary, the other part varying with the success of the undertaking.

312.  In such a factory, of course, division of labour would be introduced:  some of the workmen would be constantly employed in forging the fire-irons, others in polishing them, others in piercing and forming the fenders.  It would be essential that the time occupied in each process, and also its expense, should be well ascertained; information which would soon be obtained very precisely.  Now, if a workman should find a mode of shortening any of the processes, he would confer a benefit on the whole party, even if they received but a small part of the resulting profit.  For the promotion of such discoveries,