NASSAU WILLIAM SENIOR

Senior’s ‘last hour’: suggested explanation of a famous blunder J. Bradford DeLong I In 1837 Nassau Senior-Drummond Professor of Political Economy at Oxford-published his Letters on the Factory Act. These were an exercise in applied economics: Senior tried to show that the effects of the thenexisting Child Labour Law were bad and that the effects of the proposed Ten Hours Act would be worse.’ Not only would the regulation of working hours interfere with the workers’ freedom to make whatever contracts they wished with employers, but the regulation of working hours would also destroy substantial parts of the British cotton textile industry. In his analysis Senior commits an analytical blunder. By failing to recognize that a reduction in total labor input (hours worked) will in general entail a reduction in the total amount of working capital, he concludes that all of the profits of British cotton mills are produced “in the last hour’’ of the workday. Therefore, according to Senior, a reduction in the length of the working day from the then-current 11 Vi hours to 10 hours would either bankrupt the industry or else reduce the wages of workers to “the Irish standard .” * A decade later the Ten Hours Act passed. The British cotton textile industry did not go bankrupt. Senior’s pamphlet, written for the particular occasion, dropped into obscurity-although not without providing Marx an opportunity to rage against the Vulgar Economist Seni~r.~ ButSenior’s Letters on the Factory Act remain interesting for the magnitude and apparent obviousness of the analytical blunder committed. It seems that anyone