Front Page Titles (by Subject) Chapter 13: Contracts of Labour Partnership - The Principles of Moral and Political Philosophy
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Chapter 13: Contracts of Labour Partnership - William Paley, The Principles of Moral and Political Philosophy 
The Principles of Moral and Political Philosophy, Foreword by D.L. Le Mahieu (Indianapolis: Liberty Fund, 2002).
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Contracts of Labour
I know nothing upon the subject of partnership that requires explanation, but in what manner the profits are to be divided, where one partner contributes money, and the other labour; which is a common case.
Rule. From the stock of the partnership deduct the sum advanced, and divide the remainder between the moneyed partner and the labouring partner, in the proportion of the interest of the money to the wages of the labourer, allowing such a rate of interest as money might be borrowed for upon the same security, and such wages as a journeyman would require for the same labour and trust.
Example. A advances a thousand pounds, but knows nothing of the business; B produces no money, but has been brought up to the business, and undertakes to conduct it. At the end of the year, the stock and the effects of the partnership amount to twelve hundred pounds; consequently there are two hundred pounds to be divided. Now, nobody would lend money upon the event of the business succeeding, which is A’s security, under six per cent.; therefore A must be allowed sixty pounds for the interest of his money. B, before he engaged in the partnership, earned thirty pounds a year, in the same employment; his labour therefore ought to be valued at thirty pounds: and the two hundred pounds must be divided between the parties in the proportion of sixty to thirty: that is, A must receive one hundred and thirty-three pounds six shillings and eight pence, and B sixty-six pounds thirteen shillings and four pence.
If there be nothing gained, A loses his interest, and B his labour; which is right. If the original stock be diminished, by this rule B loses only his labour, as before; whereas A loses his interest, and part of the principal; for which eventual disadvantage A is compensated, by having the interest of his money computed at six per cent. in the division of the profits, when there are any.
It is true that the division of the profit is seldom forgotten in the constitution of the partnership, and is therefore commonly settled by express agreements: but these agreements, to be equitable, should pursue the principle of the rule here laid down.
All the partners are bound to what any one of them does in the course of the business; for, quoad hoc, each partner is considered as an authorised agent for the rest.