other uniformity than the reasonable uniformity of human With the extension of the market, due to the modern transportation system and the consequent prevalence of a single price over wide areas, the steadiness of prices has increased. This has had the result of making the work of the undertaker easier, but much more responsible and important. The failure of the undertaker here is due to one of several causes. (1) The instability of man's desires. Likings change, and products thus suited for this year's consumption are unfitted for the market of next year. (2) Failure or over-supply of some substitutionary article may produce an unwonted increase or decrease in the demand for a certain good. (3) Ignorance of the undertaker, who may not justly estimate the actual facts.

On the other hand, as a correctionary force, exists the ability of the modern undertaker to dictate consumption. Styles are created and imposed upon the consumer. Especially in matters of food and dress this is an important force, tending to produce smoothness in the process of supplying the market. The new styles displace the old first among the wealthier classes, and especially the class of social leaders. The older styles have by this time become the vogue in the classes below and can thus be "worked off" without great loss. The general result is thus a gradual movement of styles through the various classes of consumers, giving steadiness to the process of change by creating an active demand for what is a new style to each class.

Allied to this, as an instrument in the hand of the undertaker, is the modern practice of creating a market by extensive advertising and selling through traveling agents. Undertakers here produce in advance of the known demand, relying on their ability to find a market for the excess product by superior skill and energy in seeking out new customers. The most intense rivalry in modern business is found at this point. The greatest costs of production in the case of many goods are the costs of selling. This is well illustrated in the bicycle business.

The second part of the undertaking function-that of the efficient organization of productive forces-has been well described by many writers. Gen. Walker justly deserves the credit of teaching English-speaking economists the proper

emphasis to be placed upon the work of the undertaker. With the German writers he appears not to have been familiar. His treatment was the natural result of his acquaintance with two distinct sources of knowledge-the line of French writers who have written so lucidly on the subject and the peculiar facts of our American industrial organization, the scarcity of labor and the scarcity of capital, which made the rewards of skillful undertaking so great. Nowhere had there been freer scope for the undertaker than in America, in organizing the forces of the new industry. The railroad business was perhaps the largest instance. In America likewise the growth of corporate industry has received in one direction its largest development-the trust—an organization which has been especially effective in cutting down the wastes of production.

When the undertaker has reached a just estimate of the demand of consumers for the product, his attention is shifted to the problem of economizing his productive resources. The costs of production must be kept as low as possible—a problem much more complex than the simple securing of low-priced material and low-wage labor. He must study the proper balance between machinery and labor, between high-wage skillful labor and low-wage inefficient labor. He must decide whether to put in more specialized machines and more specialized labor. He must settle 'he questions of the training of the workmen in special lines of skill, of their right organization and supervision, of the inducements necessary to draw out their greatest productive capacity. Every movement of rivals must be closely watched; every change in conditions of supply of material or in quality of machine renders necessary quick adaptation to these new conditions.

The greater importance of the undertaker to-day, as well as the comparative neglect of him in the earlier literature, will both be apparent from a glance at the historic forms of undertaking.

In the feudal economy, with agriculture the prevailing industry, demand was practically fixed by custom. Even the exigencies of war were provided for by customary contributions of goods and service, and did not necessarily introduce disastrous variations into the ordinary economy. Likewise the other industries were for the most part simple accessories of agriculture or war-the manufacture of farming tools and weapons

of war-milling and weaving-rude operations limited in extent by the bounds of the manor and governed by traditional rules. Both directive and organizing functions of the undertaker were thus simple and conventional. In fact, the economy was practically household economy on a large scale and required only a minimum of individual initiative, so completely was the régime dominated by custom. Industrial change, the great opportunity of the undertaker, was too gradual to be important. It was in the political field that great rivalry existed, that skillful leadership was called for, and there was no lack of great political undertakers.

In such an economy as the frontier life in the United States, likewise, there was little to call attention to the undertaker as a distinct personality. The frontiersman, in his small way, was capitalist and laborer as well as undertaker. Here, as elsewhere, it was not until the last generation or two that the conditions existed which gave free scope to large undertaking. The slave economy of the South was more allied to feudal conditions and, like the latter, was substantially a household economy in which rivalry between different undertakers, which is necessary for the largest development of undertaking ability, did not appear. And like feudalism also, it was 'not a progressive economy.

The period of transition from the feudal economy to modern industry is very instructive in this connection. The merchant undertaker becomes early important, and with the rising importance of handicraft appears the independent craftsman. These two, the merchant and the craftsman, together performed the full function of the undertaker. The uncertainty of the market and its limited extent gave a speculative character to the business of the merchant which is well reflected in the title of adventurer sometimes assumed. It was necessary for these reasons to restrict competition by guild laws. These merchants, in the main, performed the directive function; they ascertained the goods wanted and through their more or less steady orders and purchases directed production into the right channels. The craftsman, on the other hand, undertook to produce the requisite supply. He retained largely in his own hands the organization of the productive forces, and thus merged the qualities of undertaker and workman. With craftsman too, as with

merchant, it was necessary through organization to restrict competition, since the field was very narrow. The peculiarity of this early period, therefore, is the division of the undertaking function between two classes of producers, the merchants, on the one hand, combining ownership of capital with the directive undertaking function, and the craftsman, on the other, combining labor with the technical or organizing function of the undertaker. The further peculiarity existed, also, of guildorganization in order to prevent the disaster due to too great competition in a narrow and uncertain market.

This period in which the undertaker began to gain prominence in industry was a period of great economic promise. It became in the later time a period of great geographical discovery and of rapidly extending commerce. The conditions became more and more favorable for large enterprise, until the age of Mercantilism, when the wide colonization of new countries, the rapid improvement in transportation, the growth of moneyed capital, the Anglo-Saxon supremacy, with its spirit of free individual initiative, transformed the character of the industrial organization. This newer economy saw the development of large undertaking in commercial affairs. The 17th and the 18th centuries were rich in great companies and in mercantile ventures on a grand scale. Manufacturing enterprise still remained under small undertakers, the ownership of capital being united largely with the work of the undertaker. The great development was in commerce and its allied industries, banking and transportation. But the borrowing of capital was not so necessary as at the present day, and after the great improvements in the methods of textile manufacture, the importance of the manufacturing undertaker increased greatly, so that even before the general use of the steam engine the form of undertaking began to assume its present character.

But in all these previous periods there were wanting those conditions which have given the modern undertaker his preeminence. The most important of these conditions are the following: (1) cheap and rapid transportation, (2) existence of vast accumulations of loanable capital, (3) high degree of civilization shown in the effective anticipation of wants in the remote future, (4) formation of great political empires bringing under community of law and administration the industries of

vast territories, (5) general development of the spirit of international trade and of democratic ideas, (6) existence of a real world-market with its greater stability of prices and its extension of the sources of demand and supply, (7) greater development of "division of labor," increasing the technical difficulty of undertaking, (8) greater economy in production on a large scale. These conditions have all tended to widen the scope for free industrial initiative in industry extending over wide areas and reaching toward remote results. Under a competitive régime, therefore, gain has depended upon securing the most efficient guidance of the productive processes. All classes have thus found their advantage in forming complex aggregates of productive forces, instead of producing under the old independent small concern. The ability to manage these great concerns is not too abundant, hence there has been a high-strung contest for the mastery. Everything has tended to develop genius in undertaking, and the attention of the world has been attracted to the great rôle played by these industrial functionaries. It is no mystery, then, that the attempt to explain the function of the undertaker belongs to the later economic literature.

The movement has been carried so far now toward combination in productive forces that, as has been seen, the personality of the undertaker is no longer single. With the minuter specialization of labor, the tendency is to separate the mechanical undertaking from the general organizing process in production. As has been shown, the ownership of the capital is separated from the conduct of the enterprise through the corporate organization. With the growth in the size of undertakings, and a certain tendency to monopoly growing out of the existence of the modern world-market, the temptation becomes always stronger to impress into the service of the great rival concerns the political power of the state itself. This is the most dangerous tendency in our modern world, for it is sure to be met by a radical popular resistance. If our industrial undertakers ever come to control our political life, the wrath of the people will answer with social revolution.

Johns Hopkins University.

SIDNEY SHERWOOD.