Of The Agricultural Systems Or Of Those Systems Of Political Economy Which Represent The Produce Of Land





The agricultural systems of political economy will not require so long

an explanation as that which I have thought it necessary to bestow upon

the mercantile or commercial system.



That system which represents the produce of land as the sole source of

the revenue and wealth of every country, has so far as I know, never

been adopted by any nation, and it at present exists only in the

speculations of a few men of great learning and ingenuity in France. It

would not, surely, be worth while to examine at great length the errors

of a system which never has done, and probably never will do, any harm

in any part of the world. I shall endeavour to explain, however, as

distinctly as I can, the great outlines of this very ingenious system.



Mr. Colbert, the famous minister of Lewis XIV. was a man of probity,

of great industry, and knowledge of detail; of great experience and

acuteness in the examination of public accounts; and of abilities, in

short, every way fitted for introducing method and good order into the

collection and expenditure of the public revenue. That minister had

unfortunately embraced all the prejudices of the mercantile system, in

its nature and essence a system of restraint and regulation, and such

as could scarce fail to be agreeable to a laborious and plodding man of

business, who had been accustomed to regulate the different departments

of public offices, and to establish the necessary checks and controls

for confining each to its proper sphere. The industry and commerce of

a great country, he endeavoured to regulate upon the same model as the

departments of a public office; and instead of allowing every man to

pursue his own interest his own way, upon the liberal plan of equality,

liberty, and justice, he bestowed upon certain branches of industry

extraordinary privileges, while he laid others under as extraordinary

restraints. He was not only disposed, like other European ministers, to

encourage more the industry of the towns than that of the country; but,

in order to support the industry of the towns, he was willing even to

depress and keep down that of the country. In order to render provisions

cheap to the inhabitants of the towns, and thereby to encourage

manufactures and foreign commerce, he prohibited altogether the

exportation of corn, and thus excluded the inhabitants of the country

from every foreign market, for by far the most important part of the

produce of their industry. This prohibition, joined to the restraints

imposed by the ancient provincial laws of France upon the transportation

of corn from one province to another, and to the arbitrary and degrading

taxes which are levied upon the cultivators in almost all the provinces,

discouraged and kept down the agriculture of that country very much

below the state to which it would naturally have risen in so

very fertile a soil, and so very happy a climate. This state of

discouragement and depression was felt more or less in every different

part of the country, and many different inquiries were set on foot

concerning the causes of it. One of those causes appeared to be the

preference given, by the institutions of Mr. Colbert, to the industry of

the towns above that of the country.



If the rod be bent too much one way, says the proverb, in order to

make it straight, you must bend it as much the other. The French

philosophers, who have proposed the system which represents agriculture

as the sole source of the revenue and wealth of every country, seem to

have adopted this proverbial maxim; and, as in the plan of Mr. Colbert,

the industry of the towns was certainly overvalued in comparison with

that of the country, so in their system it seems to be as certainly

under-valued.



The different orders of people, who have ever been supposed to

contribute in any respect towards the annual produce of the land and

labour of the country, they divide into three classes. The first is

the class of the proprietors of land. The second is the class of the

cultivators, of farmers and country labourers, whom they honour with the

peculiar appellation of the productive class. The third is the class of

artificers, manufacturers, and merchants, whom they endeavour to degrade

by the humiliating appellation of the barren or unproductive class.



The class of proprietors contributes to the annual produce, by the

expense which they may occasionally lay out upon the improvement of the

land, upon the buildings, drains, inclosures, and other ameliorations,

which they may either make or maintain upon it, and by means of which

the cultivators are enabled, with the same capital, to raise a greater

produce, and consequently to pay a greater rent. This advanced rent may

be considered as the interest or profit due to the proprietor, upon the

expense or capital which he thus employs in the improvement of his

land. Such expenses are in this system called ground expenses (depenses

foncieres).



The cultivators or farmers contribute to the annual produce, by what

are in this system called the original and annual expenses (depenses

primitives, et depenses annuelles), which they lay out upon the

cultivation of the land. The original expenses consist in the

instruments of husbandry, in the stock of cattle, in the seed, and in

the maintenance of the farmer's family, servants, and cattle, during at

least a great part of the first year of his occupancy, or till he can

receive some return from the land. The annual expenses consist in the

seed, in the wear and tear of instruments of husbandry, and in the

annual maintenance of the farmer's servants and cattle, and of his

family too, so far as any part of them can be considered as servants

employed in cultivation. That part of the produce of the land which

remains to him after paying the rent, ought to be sufficient, first, to

replace to him, within a reasonable time, at least during the term of

his occupancy, the whole of his original expenses, together with the

ordinary profits of stock; and, secondly, to replace to him annually

the whole of his annual expenses, together likewise with the ordinary

profits of stock. Those two sorts of expenses are two capitals which the

farmer employs in cultivation; and unless they are regularly restored

to him, together with a reasonable profit, he cannot carry on his

employment upon a level with other employments; but, from a regard to

his own interest, must desert it as soon as possible, and seek some

other. That part of the produce of the land which is thus necessary for

enabling the farmer to continue his business, ought to be considered

as a fund sacred to cultivation, which, if the landlord violates, he

necessarily reduces the produce of his own land, and, in a few years,

not only disables the farmer from paying this racked rent, but from

paying the reasonable rent which he might otherwise have got for his

land. The rent which properly belongs to the landlord, is no more than

the neat produce which remains after paying, in the completest manner,

all the necessary expenses which must be previously laid out, in order

to raise the gross or the whole produce. It is because the labour of

the cultivators, over and above paying completely all those necessary

expenses, affords a neat produce of this kind, that this class of

people are in this system peculiarly distinguished by the honourable

appellation of the productive class. Their original and annual expenses

are for the same reason called, In this system, productive expenses,

because, over and above replacing their own value, they occasion the

annual reproduction of this neat produce.



The ground expenses, as they are called, or what the landlord lays out

upon the improvement of his land, are, in this system, too, honoured

with the appellation of productive expenses. Till the whole of those

expenses, together with the ordinary profits of stock, have been

completely repaid to him by the advanced rent which he gets from his

land, that advanced rent ought to be regarded as sacred and inviolable,

both by the church and by the king; ought to be subject neither to tithe

nor to taxation. If it is otherwise, by discouraging the improvement of

land, the church discourages the future increase of her own tithes,

and the king the future increase of his own taxes. As in a well ordered

state of things, therefore, those ground expenses, over and above

reproducing in the completest manner their own value, occasion likewise,

after a certain time, a reproduction of a neat produce, they are in this

system considered as productive expenses.



The ground expenses of the landlord, however, together with the original

and the annual expenses of the farmer, are the only three sorts of

expenses which in this system are considered as productive. All other

expenses, and all other orders of people, even those who, in the common

apprehensions of men, are regarded as the most productive, are, in this

account of things, represented as altogether barren and unproductive.



Artificers and manufacturers, in particular, whose industry, in the

common apprehensions of men, increases so much the value of the rude

produce of land, are in this system represented as a class of people

altogether barren and unproductive. Their labour, it is said, replaces

only the stock which employs them, together with its ordinary profits.

That stock consists in the materials, tools, and wages, advanced to them

by their employer; and is the fund destined for their employment and

maintenance. Its profits are the fund destined for the maintenance of

their employer. Their employer, as he advances to them the stock of

materials, tools, and wages, necessary for their employment, so he

advances to himself what is necessary for his own maintenance; and this

maintenance he generally proportions to the profit which he expects

to make by the price of their work. Unless its price repays to him the

maintenance which he advances to himself, as well as the materials,

tools, and wages, which he advances to his workmen, it evidently does

not repay to him the whole expense which he lays out upon it. The

profits of manufacturing stock, therefore, are not, like the rent of

land, a neat produce which remains after completely repaying the whole

expense which must be laid out in order to obtain them. The stock of the

farmer yields him a profit, as well as that of the master manufacturer;

and it yields a rent likewise to another person, which that of the

master manufacturer does not. The expense, therefore, laid out in

employing and maintaining artificers and manufacturers, does no more

than continue, if one may say so, the existence of its own value, and

does not produce any new value. It is, therefore, altogether a barren

and unproductive expense. The expense, on the contrary, laid out in

employing farmers and country labourers, over and above continuing

the existence of its own value, produces a new value the rent of the

landlord. It is, therefore, a productive expense.



Mercantile stock is equally barren and unproductive with manufacturing

stock. It only continues the existence of its own value, without

producing any new value. Its profits are only the repayment of the

maintenance which its employer advances to himself during the time that

he employs it, or till he receives the returns of it. They are only the

repayment of a part of the expense which must be laid out in employing

it.



The labour of artificers and manufacturers never adds any thing to the

value of the whole annual amount of the rude produce of the land. It

adds, indeed, greatly to the value of some particular parts of it. But

the consumption which, in the mean time, it occasions of other parts, is

precisely equal to the value which it adds to those parts; so that the

value of the whole amount is not, at any one moment of time, in the

least augmented by it. The person who works the lace of a pair of fine

ruffles for example, will sometimes raise the value of, perhaps, a

pennyworth of flax to £30 sterling. But though, at first sight, he

appears thereby to multiply the value of a part of the rude produce

about seven thousand and two hundred times, he in reality adds nothing

to the value of the whole annual amount of the rude produce. The working

of that lace costs him, perhaps, two years labour. The £30 which he

gets for it when it is finished, is no more than the repayment of the

subsistence which he advances to himself during the two years that he is

employed about it. The value which, by every day's, month's, or year's

labour, he adds to the flax, does no more than replace the value of his

own consumption during that day, month, or year. At no moment of time,

therefore, does he add any thing to the value of the whole annual amount

of the rude produce of the land: the portion of that produce which he

is continually consuming, being always equal to the value which he is

continually producing. The extreme poverty of the greater part of the

persons employed in this expensive, though trifling manufacture, may

satisfy us that the price of their work does not, in ordinary cases,

exceed the value of their subsistence. It is otherwise with the work

of farmers and country labourers. The rent of the landlord is a value

which, in ordinary cases, it is continually producing over and above

replacing, in the most complete manner, the whole consumption, the whole

expense laid out upon the employment and maintenance both of the workmen

and of their employer.



Artificers, manufacturers, and merchants, can augment the revenue and

wealth of their society by parsimony only; or, as it is expressed in

this system, by privation, that is, by depriving themselves of a part

of the funds destined for their own subsistence. They annually reproduce

nothing but those funds. Unless, therefore, they annually save some part

of them, unless they annually deprive themselves of the enjoyment of

some part of them, the revenue and wealth of their society can never be,

in the smallest degree, augmented by means of their industry. Farmers

and country labourers, on the contrary, may enjoy completely the whole

funds destined for their own subsistence, and yet augment, at the same

time, the revenue and wealth of their society. Over and above what is

destined for their own subsistence, their industry annually affords a

neat produce, of which the augmentation necessarily augments the revenue

and wealth of their society. Nations, therefore, which, like France or

England, consist in a great measure, of proprietors and cultivators, can

be enriched by industry and enjoyment. Nations, on the contrary,

which, like Holland and Hamburgh, are composed chiefly of merchants,

artificers, and manufacturers, can grow rich only through parsimony and

privation. As the interest of nations so differently circumstanced is

very different, so is likewise the common character of the people. In

those of the former kind, liberality, frankness, and good fellowship,

naturally make a part of their common character; in the latter,

narrowness, meanness, and a selfish disposition, averse to all social

pleasure and enjoyment.



The unproductive class, that of merchants, artificers, and

manufacturers, is maintained and employed altogether at the expense

of the two other classes, of that of proprietors, and of that of

cultivators. They furnish it both with the materials of its work, and

with the fund of its subsistence, with the corn and cattle which it

consumes while it is employed about that work. The proprietors and

cultivators finally pay both the wages of all the workmen of the

unproductive class, and the profits of all their employers. Those

workmen and their employers are properly the servants of the proprietors

and cultivators. They are only servants who work without doors, as

menial servants work within. Both the one and the other, however, are

equally maintained at the expense of the same masters. The labour of

both is equally unproductive. It adds nothing to the value of the sum

total of the rude produce of the land. Instead of increasing the value

of that sum total, it is a charge and expense which must be paid out of

it.



The unproductive class, however, is not only useful, but greatly

useful, to the other two classes. By means of the industry of merchants,

artificers, and manufacturers, the proprietors and cultivators can

purchase both the foreign goods and the manufactured produce of their

own country, which they have occasion for, with the produce of a much

smaller quantity of their own labour, than what they would be obliged

to employ, if they were to attempt, in an awkward and unskilful manner,

either to import the one, or to make the other, for their own use. By

means of the unproductive class, the cultivators are delivered from

many cares, which would otherwise distract their attention from the

cultivation of land. The superiority of produce, which in consequence of

this undivided attention, they are enabled to raise, is fully sufficient

to pay the whole expense which the maintenance and employment of the

unproductive class costs either the proprietors or themselves. The

industry of merchants, artificers, and manufacturers, though in its

own nature altogether unproductive, yet contributes in this manner

indirectly to increase the produce of the land. It increases the

productive powers of productive labour, by leaving it at liberty to

confine itself to its proper employment, the cultivation of land; and

the plough goes frequently the easier and the better, by means of the

labour of the man whose business is most remote from the plough.



It can never be the interest of the proprietors and cultivators, to

restrain or to discourage, in any respect, the industry of merchants,

artificers, and manufacturers. The greater the liberty which this

unproductive class enjoys, the greater will be the competition in all

the different trades which compose it, and the cheaper will the

other two classes be supplied, both with foreign goods and with the

manufactured produce of their own country.



It can never be the interest of the unproductive class to oppress

the other two classes. It is the surplus produce of the land, or what

remains after deducting the maintenance, first of the cultivators,

and afterwards of the proprietors, that maintains and employs the

unproductive class. The greater this surplus, the greater must likewise

be the maintenance and employment of that class. The establishment of

perfect justice, of perfect liberty, and of perfect equality, is the

very simple secret which most effectually secures the highest degree of

prosperity to all the three classes.



The merchants, artificers, and manufacturers of those mercantile states,

which, like Holland and Hamburgh, consist chiefly of this unproductive

class, are in the same manner maintained and employed altogether at the

expense of the proprietors and cultivators of land. The only difference

is, that those proprietors and cultivators are, the greater part

of them, placed at a most inconvenient distance from the merchants,

artificers, and manufacturers, whom they supply with the materials of

their work and the fund of their subsistence; are the inhabitants of

other countries, and the subjects of other governments.



Such mercantile states, however, are not only useful, but greatly

useful, to the inhabitants of those other countries. They fill up,

in some measure, a very important void; and supply the place of the

merchants, artificers, and manufacturers, whom the inhabitants of those

countries ought to find at home, but whom, from some defect in their

policy, they do not find at home.



It can never be the interest of those landed nations, if I may call them

so, to discourage or distress the industry of such mercantile states,

by imposing high duties upon their trade, or upon the commodities which

they furnish. Such duties, by rendering those commodities dearer, could

serve only to sink the real value of the surplus produce of their own

land, with which, or, what comes to the same thing, with the price of

which those commodities are purchased. Such duties could only serve to

discourage the increase of that surplus produce, and consequently

the improvement and cultivation of their own land. The most effectual

expedient, on the contrary, for raising the value of that surplus

produce, for encouraging its increase, and consequently the improvement

and cultivation of their own land, would be to allow the most perfect

freedom to the trade of all such mercantile nations.



This perfect freedom of trade would even be the most effectual expedient

for supplying them, in due time, with all the artificers, manufacturers,

and merchants, whom they wanted at home; and for filling up, in the

properest and most advantageous manner, that very important void which

they felt there.



The continual increase of the surplus produce of their land would, in

due time, create a greater capital than what would be employed with the

ordinary rate of profit in the improvement and cultivation of land; and

the surplus part of it would naturally turn itself to the employment

of artificers and manufacturers, at home. But these artificers and

manufacturers, finding at home both the materials of their work and the

fund of their subsistence, might immediately, even with much less

art and skill be able to work as cheap as the little artificers and

manufacturers of such mercantile states, who had both to bring from a

greater distance. Even though, from want of art and skill, they might

not for some time be able to work as cheap, yet, finding a market at

home, they might be able to sell their work there as cheap as that of

the artificers and manufacturers of such mercantile states, which could

not be brought to that market but from so great a distance; and as their

art and skill improved, they would soon be able to sell it cheaper. The

artificers and manufacturers of such mercantile states, therefore, would

immediately be rivalled in the market of those landed nations, and soon

after undersold and justled out of it altogether. The cheapness of the

manufactures of those landed nations, in consequence of the gradual

improvements of art and skill, would, in due time, extend their sale

beyond the home market, and carry them to many foreign markets, from

which they would, in the same manner, gradually justle out many of the

manufacturers of such mercantile nations.



This continual increase, both of the rude and manufactured produce of

those landed nations, would, in due time, create a greater capital

than could, with the ordinary rate of profit, be employed either in

agriculture or in manufactures. The surplus of this capital would

naturally turn itself to foreign trade and be employed in exporting, to

foreign countries, such parts of the rude and manufactured produce

of its own country, as exceeded the demand of the home market. In the

exportation of the produce of their own country, the merchants of a

landed nation would have an advantage of the same kind over those of

mercantile nations, which its artificers and manufacturers had over the

artificers and manufacturers of such nations; the advantage of finding

at home that cargo, and those stores and provisions, which the others

were obliged to seek for at a distance. With inferior art and skill in

navigation, therefore, they would be able to sell that cargo as cheap

in foreign markets as the merchants of such mercantile nations; and with

equal art and skill they would be able to sell it cheaper. They would

soon, therefore, rival those mercantile nations in this branch of

foreign trade, and, in due time, would justle them out of it altogether.



According to this liberal and generous system, therefore, the most

advantageous method in which a landed nation can raise up artificers,

manufacturers, and merchants of its own, is to grant the most perfect

freedom of trade to the artificers, manufacturers, and merchants of all

other nations. It thereby raises the value of the surplus produce of its

own land, of which the continual increase gradually establishes a

fund, which, in due time, necessarily raises up all the artificers,

manufacturers, and merchants, whom it has occasion for.



When a landed nation on the contrary, oppresses, either by high duties

or by prohibitions, the trade of foreign nations, it necessarily hurts

its own interest in two different ways. First, by raising the price

of all foreign goods, and of all sorts of manufactures, it necessarily

sinks the real value of the surplus produce of its own land, with which,

or, what comes to the same thing, with the price of which, it purchases

those foreign goods and manufactures. Secondly, by giving a sort of

monopoly of the home market to its own merchants, artificers, and

manufacturers, it raises the rate of mercantile and manufacturing

profit, in proportion to that of agricultural profit; and, consequently,

either draws from agriculture a part of the capital which had before

been employed in it, or hinders from going to it a part of what

would otherwise have gone to it. This policy, therefore, discourages

agriculture in two different ways; first, by sinking the real value

of its produce, and thereby lowering the rate of its profits; and,

secondly, by raising the rate of profit in all other employments.

Agriculture is rendered less advantageous, and trade and manufactures

more advantageous, than they otherwise would be; and every man is

tempted by his own interest to turn, as much as he can, both his capital

and his industry from the former to the latter employments.



Though, by this oppressive policy, a landed nation should be able to

raise up artificers, manufacturers, and merchants of its own, somewhat

sooner than it could do by the freedom of trade; a matter, however,

which is not a little doubtful; yet it would raise them up, if one

may say so, prematurely, and before it was perfectly ripe for them. By

raising up too hastily one species of industry, it would depress another

more valuable species of industry. By raising up too hastily a species

of industry which duly replaces the stock which employs it, together

with the ordinary profit, it would depress a species of industry which,

over and above replacing that stock, with its profit, affords likewise

a neat produce, a free rent to the landlord. It would depress productive

labour, by encouraging too hastily that labour which is altogether

barren and unproductive.



In what manner, according to this system, the sum total of the annual

produce of the land is distributed among the three classes above

mentioned, and in what manner the labour of the unproductive class

does no more than replace the value of its own consumption, without

increasing in any respect the value of that sum total, is represented

by Mr Quesnai, the very ingenious and profound author of this system, in

some arithmetical formularies. The first of these formularies, which,

by way of eminence, he peculiarly distinguishes by the name of the

Economical Table, represents the manner in which he supposes this

distribution takes place, in a state of the most perfect liberty,

and, therefore, of the highest prosperity; in a state where the annual

produce is such as to afford the greatest possible neat produce, and

where each class enjoys its proper share of the whole annual produce.

Some subsequent formularies represent the manner in which he supposes

this distribution is made in different states of restraint and

regulation; in which, either the class of proprietors, or the barren and

unproductive class, is more favoured than the class of cultivators; and

in which either the one or the other encroaches, more or less, upon the

share which ought properly to belong to this productive class. Every

such encroachment, every violation of that natural distribution, which

the most perfect liberty would establish, must, according to this

system, necessarily degrade, more or less, from one year to another, the

value and sum total of the annual produce, and must necessarily occasion

a gradual declension in the real wealth and revenue of the society; a

declension, of which the progress must be quicker or slower, according

to the degree of this encroachment, according as that natural

distribution, which the most perfect liberty would establish, is more

or less violated. Those subsequent formularies represent the different

degrees of declension which, according to this system, correspond to

the different degrees in which this natural distribution of things is

violated.



Some speculative physicians seem to have imagined that the health of the

human body could be preserved only by a certain precise regimen of

diet and exercise, of which every, the smallest violation, necessarily

occasioned some degree of disease or disorder proportionate to the

degree of the violation. Experience, however, would seem to shew, that

the human body frequently preserves, to all appearance at least, the

most perfect state of health under a vast variety of different regimens;

even under some which are generally believed to be very far from being

perfectly wholesome. But the healthful state of the human body, it would

seem, contains in itself some unknown principle of preservation, capable

either of preventing or of correcting, in many respects, the bad effects

even of a very faulty regimen. Mr Quesnai, who was himself a physician,

and a very speculative physician, seems to have entertained a notion of

the same kind concerning the political body, and to have imagined that

it would thrive and prosper only under a certain precise regimen, the

exact regimen of perfect liberty and perfect justice. He seems not to

have considered, that in the political body, the natural effort which

every man is continually making to better his own condition, is a

principle of preservation capable of preventing and correcting, in many

respects, the bad effects of a political economy, in some degree both

partial and oppressive. Such a political economy, though it no doubt

retards more or less, is not always capable of stopping altogether, the

natural progress of a nation towards wealth and prosperity, and still

less of making it go backwards. If a nation could not prosper without

the enjoyment of perfect liberty and perfect justice, there is not in

the world a nation which could ever have prospered. In the political

body, however, the wisdom of nature has fortunately made ample provision

for remedying many of the bad effects of the folly and injustice of man;

it the same manner as it has done in the natural body, for remedying

those of his sloth and intemperance.



The capital error of this system, however, seems to lie in its

representing the class of artificers, manufacturers, and merchants, as

altogether barren and unproductive. The following observations may serve

to shew the impropriety of this representation:--



First, this class, it is acknowledged, reproduces annually the value of

its own annual consmnption, and continues, at least, the existence of

the stock or capital which maintains and employs it. But, upon this

account alone, the denomination of barren or unproductive should seem to

be very improperly applied to it. We should not call a marriage barren

or unproductive, though it produced only a son and a daughter, to

replace the father and mother, and though it did not increase the number

of the human species, but only continued it as it was before. Farmers

and country labourers, indeed, over and above the stock which maintains

and employs them, reproduce annually a neat produce, a free rent to the

landlord. As a marriage which affords three children is certainly more

productive than one which affords only two, so the labour of farmers and

country labourers is certainly more productive than that of merchants,

artificers, and manufacturers. The superior produce of the one class,

however, does not, render the other barren or unproductive.



Secondly, it seems, on this account, altogether improper to consider

artificers, manufacturers, and merchants, in the same light as menial

servants. The labour of menial servants does not continue the existence

of the fund which maintains and employs them. Their maintenance and

employment is altogether at the expense of their masters, and the work

which they perform is not of a nature to repay that expense. That work

consists in services which perish generally in the very instant of

their performance, and does not fix or realize itself in any vendible

commodity, which can replace the value of their wages and maintenance.

The labour, on the contrary, of artificers, manufacturers, and

merchants, naturally does fix and realize itself in some such vendible

commodity. It is upon this account that, in the chapter in which I

treat of productive and unproductive labour, I have classed artificers,

manufacturers, and merchants among the productive labourers, and menial

servants among the barren or unproductive.



Thirdly, it seems, upon every supposition, improper to say, that the

labour of artificers, manufacturers, and merchants, does not increase

the real revenue of the society. Though we should suppose, for example,

as it seems to be supposed in this system, that the value of the daily,

monthly, and yearly consumption of this class was exactly equal to that

of its daily, monthly, and yearly production; yet it would not from

thence follow, that its labour added nothing to the real revenue, to the

real value of the annual produce of the land and labour of the society.

An artificer, for example, who, in the first six months after harvest,

executes ten pounds worth of work, though he should, in the same time,

consume ten pounds worth of corn and other necessaries, yet really adds

the value of ten pounds to the annual produce of the land and labour of

the society. While he has been consuming a half-yearly revenue of ten

pounds worth of corn and other necessaries, he has produced an equal

value of work, capable of purchasing, either to himself, or to some

other person, an equal half-yearly revenue. The value, therefore, of

what has been consumed and produced during these six months, is equal,

not to ten, but to twenty pounds. It is possible, indeed, that no more

than ten pounds worth of this value may ever have existed at any

one moment of time. But if the ten pounds worth of corn and other

necessaries which were consumed by the artificer, had been consumed by

a soldier, or by a menial servant, the value of that part of the annual

produce which existed at the end of the six months, would have been

ten pounds less than it actually is in consequence of the labour of the

artificer. Though the value of what the artificer produces, therefore,

should not, at any one moment of time, be supposed greater than the

value he consumes, yet, at every moment of time, the actually existing

value of goods in the market is, in consequence of what he produces,

greater than it otherwise would be.



When the patrons of this system assert, that the consumption of

artificers, manufacturer's, and merchants, is equal to the value of what

they produce, they probably mean no more than that their revenue, or

the fund destined for their consumption, is equal to it. But if they

had expressed themselves more accurately, and only asserted, that the

revenue of this class was equal to the value of what they produced, it

might readily have occurred to the reader, that what would naturally be

saved out of this revenue, must necessarily increase more or less the

real wealth of the society. In order, therefore, to make out something

like an argument, it was necessary that they should express themselves

as they have done; and this argument, even supposing things actually

were as it seems to presume them to be, turns out to be a very

inconclusive one.



Fourthly, farmers and country labourers can no more augment, without

parsimony, the real revenue, the annual produce of the land and labour

of their society, than artificers, manufacturers, and merchants. The

annual produce of the land and labour of any society can be augmented

only in two ways; either, first, by some improvement in the productive

powers of the useful labour actually maintained within it; or, secondly,

by some increase in the quantity of that labour.



The improvement in the productive powers of useful labour depends,

first, upon the improvement in the ability of the workman; and,

secondly, upon that of the machinery with which he works. But the

labour of artificers and manufacturers, as it is capable of being

more subdivided, and the labour of each workman reduced to a greater

simplicity of operation, than that of farmers and country labourers;

so it is likewise capable of both these sorts of improvement in a much

higher degree {See book i chap. 1.} In this respect, therefore,

the class of cultivators can have no sort of advantage over that of

artificers and manufacturers.



The increase in the quantity of useful labour actually employed within

any society must depend altogether upon the increase of the capital

which employs it; and the increase of that capital, again, must be

exactly equal to the amount of the savings from the revenue, either

of the particular persons who manage and direct the employment of that

capital, or of some other persons, who lend it to them. If merchants,

artificers, and manufacturers are, as this system seems to suppose,

naturally more inclined to parsimony and saving than proprietors and

cultivators, they are, so far, more likely to augment the quantity

of useful labour employed within their society, and consequently to

increase its real revenue, the annual produce of its land and labour.



Fifthly and lastly, though the revenue of the inhabitants of every

country was supposed to consist altogether, as this system seems to

suppose, in the quantity of subsistence which their industry could

procure to them; yet, even upon this supposition, the revenue of a

trading and manufacturing country must, other things being equal, always

be much greater than that of one without trade or manufactures. By means

of trade and manufactures, a greater quantity of subsistence can be

annually imported into a particular country, than what its own lands, in

the actual state of their cultivation, could afford. The inhabitants of

a town, though they frequently possess no lands of their own, yet draw

to themselves, by their industry, such a quantity of the rude produce of

the lands of other people, as supplies them, not only with the materials

of their work, but with the fund of their subsistence. What a town

always is with regard to the country in its neighbourhood, one

independent state or country may frequently be with regard to other

independent states or countries. It is thus that Holland draws a great

part of its subsistence from other countries; live cattle from Holstein

and Jutland, and corn from almost all the different countries of Europe.

A small quantity of manufactured produce, purchases a great quantity of

rude produce. A trading and manufacturing country, therefore, naturally

purchases, with a small part of its manufactured produce, a great

part of the rude produce of other countries; while, on the contrary, a

country without trade and manufactures is generally obliged to purchase,

at the expense of a great part of its rude produce, a very small part

of the manufactured produce of other countries. The one exports what can

subsist and accommodate but a very few, and imports the subsistence and

accommodation of a great number. The other exports the accommodation and

subsistence of a great number, and imports that of a very few only.

The inhabitants of the one must always enjoy a much greater quantity

of subsistence than what their own lands, in the actual state of their

cultivation, could afford. The inhabitants of the other must always

enjoy a much smaller quantity.



This system, however, with all its imperfections, is perhaps the nearest

approximation to the truth that has yet been published upon the

subject of political economy; and is upon that account, well worth the

consideration of every man who wishes to examine with attention the

principles of that very important science. Though in representing the

labour which is employed upon land as the only productive labour, the

notions which it inculcates are, perhaps, too narrow and confined;

yet in representing the wealth of nations as consisting, not in the

unconsumable riches of money, but in the consumable goods annually

reproduced by the labour of the society, and in representing perfect

liberty as the only effectual expedient for rendering this annual

reproduction the greatest possible, its doctrine seems to be in every

respect as just as it is generous and liberal. Its followers are

very numerous; and as men are fond of paradoxes, and of appearing to

understand what surpasses the comprehensions of ordinary people, the

paradox which it maintains, concerning the unproductive nature of

manufacturing labour, has not, perhaps, contributed a little to increase

the number of its admirers. They have for some years past made a pretty

considerable sect, distinguished in the French republic of letters by

the name of the Economists. Their works have certainly been of some

service to their country; not only by bringing into general discussion,

many subjects which had never been well examined before, but by

influencing, in some measure, the public administration in favour

of agriculture. It has been in consequence of their representations,

accordingly, that the agriculture of France has been delivered from

several of the oppressions which it before laboured under. The term,

during which such a lease can be granted, as will be valid against every

future purchaser or proprietor of the land, has been prolonged from

nine to twenty-seven years. The ancient provincial restraints upon the

transportation of corn from one province of the kingdom to another, have

been entirely taken away; and the liberty of exporting it to all foreign

countries, has been established as the common law of the kingdom in all

ordinary cases. This sect, in their works, which are very numerous, and

which treat not only of what is properly called Political Economy, or

of the nature and causes or the wealth of nations, but of every other

branch of the system of civil government, all follow implicitly, and

without any sensible variation, the doctrine of Mr. Qttesnai. There is,

upon this account, little variety in the greater part of their works.

The most distinct and best connected account of this doctrine is to be

found in a little book written by Mr. Mercier de la Riviere, some time

intendant of Martinico, entitled, The natural and essential Order of

Political Societies. The admiration of this whole sect for their master,

who was himself a man of the greatest modesty and simplicity, is not

inferior to that of any of the ancient philosophers for the founders of

their respective systems. 'There have been since the world began,' says

a very diligent and respectable author, the Marquis de Mirabeau, 'three

great inventions which have principally given stability to political

societies, independent of many other inventions which have enriched and

adorned them. The first is the invention of writing, which alone gives

human nature the power of transmitting, without alteration, its laws,

its contracts, its annals, and its discoveries. The second is the

invention of money, which binds together all the relations between

civilized societies. The third is the economical table, the result of

the other two, which completes them both by perfecting their object;

the great discovery of our age, but of which our posterity will reap the

benefit.'



As the political economy of the nations of modern Europe has been more

favourable to manufactures and foreign trade, the industry of the towns,

than to agriculture, the industry of the country; so that of other

nations has followed a different plan, and has been more favourable to

agriculture than to manufactures and foreign trade.



The policy of China favours agriculture more than all other employments.

In China, the condition of a labourer is said to be as much superior to

that of an artificer, as in most parts of Europe that of an artificer is

to that of a labourer. In China, the great ambition of every man is to

get possession of a little bit of land, either in property or in lease;

and leases are there said to be granted upon very moderate terms, and to

be sufficiently secured to the lessees. The Chinese have little respect

for foreign trade. Your beggarly commerce! was the language in which

the mandarins of Pekin used to talk to Mr. De Lange, the Russian envoy,

concerning it {See the Journal of Mr. De Lange, in Bell's Travels,

vol. ii. p. 258, 276, 293.}. Except with Japan, the Chinese carry on,

themselves, and in their own bottoms, little or no foreign trade; and it

is only into one or two ports of their kingdom that they even admit the

ships of foreign nations. Foreign trade, therefore, is, in China, every

way confined within a much narrower circle than that to which it would

naturally extend itself, if more freedom was allowed to it, either in

their own ships, or in those of foreign nations.



Manufactures, as in a small bulk they frequently contain a great value,

and can upon that account be transported at less expense from one

country to another than most parts of rude produce, are, in almost

all countries, the principal support of foreign trade. In countries,

besides, less extensive, and less favourably circumstanced for inferior

commerce than China, they generally require the support of foreign

trade. Without an extensive foreign market, they could not well

flourish, either in countries so moderately extensive as to afford but a

narrow home market, or in countries where the communication between one

province and another was so difficult, as to render it impossible for

the goods of any particular place to enjoy the whole of that home

market which the country could afford. The perfection of manufacturing

industry, it must be remembered, depends altogether upon the division of

labour; and the degree to which the division of labour can be introduced

into any manufacture, is necessarily regulated, it has already been

shewn, by the extent of the market. But the great extent of the empire

of China, the vast multitude of its inhabitants, the variety of climate,

and consequently of productions in its different provinces, and the easy

communication by means of water-carriage between the greater part of

them, render the home market of that country of so great extent, as to

be alone sufficient to support very great manufactures, and to admit of

very considerable subdivisions of labour. The home market of China is,

perhaps, in extent, not much inferior to the market of all the different

countries of Europe put together. A more extensive foreign trade,

however, which to this great home market added the foreign market of all

the rest of the world, especially if any considerable part of this trade

was carried on in Chinese ships, could scarce fail to increase very

much the manufactures of China, and to improve very much the productive

powers of its manufacturing industry. By a more extensive navigation,

the Chinese would naturally learn the art of using and constructing,

themselves, all the different machines made use of in other countries,

as well as the other improvements of art and industry which are

practised in all the different parts of the world. Upon their present

plan, they have little opportunity of improving themselves by the

example of any other nation, except that of the Japanese.



The policy of ancient Egypt, too, and that of the Gentoo government

of Indostan, seem to have favoured agriculture more than all other

employments.



Both in ancient Egypt and Indostan, the whole body of the people was

divided into different casts or tribes each of which was confined, from

father to son, to a particular employment, or class of employments.

The son of a priest was necessarily a priest; the son of a soldier,

a soldier; the son of a labourer, a labourer; the son of a weaver, a

weaver; the son of a tailor, a tailor, etc. In both countries, the cast

of the priests holds the highest rank, and that of the soldiers the

next; and in both countries the cast of the farmers and labourers was

superior to the casts of merchants and manufacturers.



The government of both countries was particularly attentive to the

interest of agriculture. The works constructed by the ancient sovereigns

of Egypt, for the proper distribution of the waters of the Nile, were

famous in antiquity, and the ruined remains of some of them are

still the admiration of travellers. Those of the same kind which were

constructed by the ancient sovereigns of Indostan, for the proper

distribution of the waters of the Ganges, as well as of many other

rivers, though they have been less celebrated, seem to have been equally

great. Both countries, accordingly, though subject occasionally to

dearths, have been famous for their great fertility. Though both were

extremely populous, yet, in years of moderate plenty, they were both

able to export great quantities of grain to their neighbours.



The ancient Egyptians had a superstitious aversion to the sea; and as

the Gentoo religion does not permit its followers to light a fire,

nor consequently to dress any victuals, upon the water, it, in effect,

prohibits them from all distant sea voyages. Both the Egyptians and

Indians must have depended almost altogether upon the navigation of

other nations for the exportation of their surplus produce; and this

dependency, as it must have confined the market, so it must have

discouraged the increase of this surplus produce. It must have

discouraged, too, the increase of the manufactured produce, more than

that of the rude produce. Manufactures require a much more extensive

market than the most important parts of the rude produce of the land. A

single shoemaker will make more than 300 pairs of shoes in the year; and

his own family will not, perhaps, wear out six pairs. Unless, therefore,

he has the custom of, at least, 50 such families as his own, he cannot

dispose of the whole product of his own labour. The most numerous class

of artificers will seldom, in a large country, make more than one in 50,

or one in a 100, of the whole number of families contained in it. But

in such large countries, as France and England, the number of people

employed in agriculture has, by some authors been computed at a half, by

others at a third and by no author that I know of, at less that a fifth

of the whole inhabitants of the country. But as the produce of the

agriculture of both France and England is, the far greater part of it,

consumed at home, each person employed in it must, according to these

computations, require little more than the custom of one, two, or, at

most, of four such families as his own, in order to dispose of the whole

produce of his own labour. Agriculture, therefore, can support

itself under the discouragement of a confined market much better

than manufactures. In both ancient Egypt and Indostan, indeed, the

confinement of the foreign market was in some measure compensated by

the conveniency of many inland navigations, which opened, in the most

advantageous manner, the whole extent of the home market to every part

of the produce of every different district of those countries. The great

extent of Indostan, too, rendered the home market of that country very

great, and sufficient to support a great variety of manufactures. But

the small extent of ancient Egypt, which was never equal to England,

must at all times, have rendered the home market of that country

too narrow for supporting any great variety of manufactures. Bengal

accordingly, the province of Indostan which commonly exports the

greatest quantity of rice, has always been more remarkable for the

exportation of a great variety of manufactures, than for that of

its grain. Ancient Egypt, on the contrary, though it exported some

manufactures, fine linen in particular, as well as some other goods,

was always most distinguished for its great exportation of grain. It was

long the granary of the Roman empire.



The sovereigns of China, of ancient Egypt, and of the different kingdoms

into which Indostan has, at different times, been divided, have always

derived the whole, or by far the most considerable part, of their

revenue, from some sort of land tax or land rent. This land tax, or land

rent, like the tithe in Europe, consisted in a certain proportion,

a fifth, it is said, of the produce of the land, which was either

delivered in kind, or paid in money, according to a certain valuation,

and which, therefore, varied from year to year, according to all

the variations of the produce. It was natural, therefore, that the

sovereigns of those countries should be particularly attentive to the

interests of agriculture, upon the prosperity or declension of which

immediately depended the yearly increase or diminution of their own

revenue.



The policy of the ancient republics of Greece, and that of Rome, though

it honoured agriculture more than manufactures or foreign trade, yet

seems rather to have discouraged the latter employments, than to have

given any direct or intentional encouragement to the former. In

several of the ancient states of Greece, foreign trade was prohibited

altogether; and in several others, the employments of artificers and

manufacturers were considered as hurtful to the strength and agility of

the human body, as rendering it incapable of those habits which their

military and gymnastic exercises endeavoured to form in it, and as

thereby disqualifying it, more or less, for undergoing the fatigues and

encountering the dangers of war. Such occupations were considered as

fit only for slaves, and the free citizens of the states were prohibited

from exercising them. Even in those states where no such prohibition

took place, as in Rome and Athens, the great body of the people were in

effect excluded from all the trades which are now commonly exercised by

the lower sort of the inhabitants of towns. Such trades were, at Athens

and Rome, all occupied by the slaves of the rich, who exercised them for

the benefit of their masters, whose wealth, power, and protection, made

it almost impossible for a poor freeman to find a market for his work,

when it came into competition with that of the slaves of the rich.

Slaves, however, are very seldom inventive; and all the most

important improvements, either in machinery, or in the arrangement and

distribution of work, which facilitate and abridge labour have been the

discoveries of freemen. Should a slave propose any improvement of this

kind, his master would be very apt to consider the proposal as the

suggestion of laziness, and of a desire to save his own labour at the

master's expense. The poor slave, instead of reward would probably

meet with much abuse, perhaps with some punishment. In the manufactures

carried on by slaves, therefore, more labour must generally have been

employed to execute the same quantity of work, than in those carried on

by freemen. The work of the farmer must, upon that account, generally

have been dearer than that of the latter. The Hungarian mines, it is

remarked by Mr. Montesquieu, though not richer, have always been wrought

with less expense, and therefore with more profit, than the Turkish

mines in their neighbourhood. The Turkish mines are wrought by slaves;

and the arms of those slaves are the only machines which the Turks have

ever thought of employing. The Hungarian mines are wrought by freemen,

who employ a great deal of machinery, by which they facilitate and

abridge their own labour. From the very little that is known about the

price of manufactures in the times of the Greeks and Romans, it would

appear that those of the finer sort were excessively dear. Silk sold

for its weight in gold. It was not, indeed, in those times an European

manufacture; and as it was all brought from the East Indies, the

distance of the carriage may in some measure account for the greatness

of the price. The price, however, which a lady, it is said, would

sometimes pay for a piece of very fine linen, seems to have been equally

extravagant; and as linen was always either an European, or at farthest,

an Egyptian manufacture, this high price can be accounted for only by

the great expense of the labour which must have been employed about It,

and the expense of this labour again could arise from nothing but the

awkwardness of the machinery which is made use of. The price of fine

woollens, too, though not quite so extravagant, seems, however, to have

been much above that of the present times. Some cloths, we are told by

Pliny {Plin. 1. ix.c.39.}, dyed in a particular manner, cost a hundred

denarii, or £3:6s:8d. the pound weight. Others, dyed in another manner,

cost a thousand denarii the pound weight, or £33:6s:8d. The Roman pound,

it must be remembered, contained only twelve of our avoirdupois ounces.

This high price, indeed, seems to have been principally owing to the

dye. But had not the cloths themselves been much dearer than any

which are made in the present times, so very expensive a dye would not

probably have been bestowed upon them. The disproportion would have been

too great between the value of the accessory and that of the principal.

The price mentioned by the same author {Plin. 1. viii.c.48.}, of some

triclinaria, a sort of woollen pillows or cushions made use of to

lean upon as they reclined upon their couches at table, passes all

credibility; some of them being said to have cost more than £30,000,

others more than £300,000. This high price, too, is not said to have

arisen from the dye. In the dress of the people of fashion of both

sexes, there seems to have been much less variety, it is observed by Dr.

Arbuthnot, in ancient than in modern times; and the very little variety

which we find in that of the ancient statues, confirms his observation.

He infers from this, that their dress must, upon the whole, have been

cheaper than ours; but the conclusion does not seem to follow. When the

expense of fashionable dress is very great, the variety must be very

small. But when, by the improvements in the productive powers of

manufacturing art and industry, the expense of any one dress comes to be

very moderate, the variety will naturally be very great. The rich, not

being able to distinguish themselves by the expense of any one dress,

will naturally endeavour to do so by the multitude and variety of their

dresses.



The greatest and most important branch of the commerce of every nation,

it has already been observed, is that which is carried on between the

inhabitants of the town and those of the country. The inhabitants of the

town draw from the country the rude produce, which constitutes both the

materials of their work and the fund of their subsistence; and they pay

for this rude produce, by sending back to the country a certain portion

of it manufactured and prepared for immediate use. The trade which

is carried on between these two different sets of people, consists

ultimately in a certain quantity of rude produce exchanged for a certain

quantity of manufactured produce. The dearer the latter, therefore, the

cheaper the former; and whatever tends in any country to raise the price

of manufactured produce, tends to lower that of the rude produce of the

land, and thereby to discourage agriculture. The smaller the quantity of

manufactured produce, which any given quantity of rude produce, or, what

comes to the same thing, which the price of any given quantity of rude

produce, is capable of purchasing, the smaller the exchangeable value of

that given quantity of rude produce; the smaller the encouragement which

either the landlord has to increase its quantity by improving, or the

farmer by cultivating the land. Whatever, besides, tends to diminish

in any country the number of artificers and manufacturers, tends to

diminish the home market, the most important of all markets, for the

rude produce of the land, and thereby still further to discourage

agriculture.



Those systems, therefore, which preferring agriculture to all other

employments, in order to promote it, impose restraints upon manufactures

and foreign trade, act contrary to the very end which they propose, and

indirectly discourage that very species of industry which they mean

to promote. They are so far, perhaps, more inconsistent than even the

mercantile system. That system, by encouraging manufactures and foreign

trade more than agriculture, turns a certain portion of the capital

of the society, from supporting a more advantageous, to support a less

advantageous species of industry. But still it really, and in the end,

encourages that species of industry which it means to promote.

Those agricultural systems, on the contrary, really, and in the end,

discourage their own favourite species of industry.



It is thus that every system which endeavours, either, by extraordinary

encouragements to draw towards a particular species of industry a

greater share of the capital of the society than what would naturally

go to it, or, by extraordinary restraints, to force from a particular

species of industry some share of the capital which would otherwise be

employed in it, is, in reality, subversive of the great purpose which

it means to promote. It retards, instead of accelerating the progress of

the society towards real wealth and greatness; and diminishes, instead

of increasing, the real value of the annual produce of its land and

labour.



All systems, either of preference or of restraint, therefore, being thus

completely taken away, the obvious and simple system of natural liberty

establishes itself of its own accord. Every man, as long as he does not

violate the laws of justice, is left perfectly free to pursue his own

interest his own way, and to bring both his industry and capital into

competition with those of any other man, or order of men. The sovereign

is completely discharged from a duty, in the attempting to perform which

he must always be exposed to innumerable delusions, and for the proper

performance of which, no human wisdom or knowledge could ever be

sufficient; the duty of superintending the industry of private people,

and of directing it towards the employments most suitable to the

interests of the society. According to the system of natural liberty,

the sovereign has only three duties to attend to; three duties of great

importance, indeed, but plain and intelligible to common understandings:

first, the duty of protecting the society from the violence and invasion

of other independent societies; secondly, the duty of protecting, as

far as possible, every member of the society from the injustice or

oppression of every other member of it, or the duty of establishing an

exact administration of justice; and, thirdly, the duty of erecting and

maintaining certain public works, and certain public institutions, which

it can never be for the interest of any individual, or small number of

individuals to erect and maintain; because the profit could never repay

the expense to any individual, or small number of individuals, though it

may frequently do much more than repay it to a great society.



The proper performance of those several duties of the sovereign

necessarily supposes a certain expense; and this expense again

necessarily requires a certain revenue to support it. In the following

book, therefore, I shall endeavour to explain, first, what are the

necessary expenses of the sovereign or commonwealth; and which of those

expenses ought to be defrayed by the general contribution of the whole

society; and which of them, by that of some particular part only, or of

some particular members of the society: secondly, what are the different

methods in which the whole society may be made to contribute towards

defraying the expenses incumbent on the whole society; and what are the

principal advantages and inconveniencies of each of those methods: and

thirdly, what are the reasons and causes which have induced almost all

modern governments to mortgage some part of this revenue, or to contract

debts; and what have been the effects of those debts upon the real

wealth, the annual produce of the land and labour of the society.

The following book, therefore, will naturally be divided into three

chapters.





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