Labour Exchange, a term very frequently applied to registries having for their principal object the better distribution of labour (see Unemployment). Historically the term is applied to the system of equitable labour exchanges established in England between 1832 and 1834 by Robert Owen and his followers. The idea is said to have originated with Josiah Warren, who communicated it to Owen. Warren tried an experiment in 1828 at Cincinnati, opening an exchange under the title of a “time store.” He joined in starting another at Tuscarawas, Ohio, and a third at Mount Vernon, Indiana, but none were quite on the same line as the English exchanges. The fundamental idea of the English exchanges was to establish a currency based upon labour; Owen in The Crisis for June 1832 laid down that all wealth proceeded from labour and knowledge; that labour and knowledge were generally remunerated according to the time employed, and that in the new exchanges it was proposed to make time the standard or measure of wealth. This new currency was represented by “labour notes,” the notes being measured in hours, and the hour reckoned as being worth sixpence, this figure being taken as the mean between the wage of the best and the worst paid labour. Goods were then to be exchanged for the new currency. The exchange was opened in extensive premises in the Gray’s Inn Road, near King’s Cross, London, on the 3rd of September 1832. For some months the establishment met with considerable success, and a considerable number of tradesmen agreed to take labour notes in payment for their goods. At first, an enormous number of deposits was made, amounting in seventeen weeks to 445,501 hours. But difficulties soon arose from the lack of sound practical valuators, and from the inability of the promoters to distinguish between the labour of the highly skilled and that of the unskilled. Tradesmen, too, were quick to see that the exchange might be worked to their advantage; they brought unsaleable stock from their shops, exchanged it for labour notes, and then picked out the best of the saleable articles. Consequently the labour notes began to depreciate; trouble also arose with the proprietors of the premises, and the experiment came to an untimely end early in 1834.
See F. Podmore’s Robert Owen, ii. c. xvii. (1906); B. Jones, Co-operative Production, c. viii. (1894); G. J. Holyoake, History of Co-operation, c. viii. (1906).
