What economic principle did David Ricardo advocate concerning wage levels?

David Ricardo advocated the "Iron Law of Wages," a principle stating that wages naturally tend to settle at the minimum level necessary for the subsistence of workers. According to this theory, if wages rise above this subsistence level, it would lead to an increase in the working population. However, as more workers enter the labor market, the supply of labor would eventually exceed demand, leading to a reduction in wages back to the subsistence level. This concept highlights the relationship between population growth and wage levels, suggesting that wages will not significantly improve over time because any increases will be counterbalanced by the economic laws governing population dynamics.

Ricardo’s perspective is significant in the context of 19th-century industrialization, where the workforce experienced harsh economic conditions. His ideas influenced the understanding of labor economics and the prevailing theories of wages during that time.