Of The Accumulation Of Capital Or Of Productive And Unproductive Labour

There is one sort of labour which adds to the value of the subject upon

which it is bestowed; there is another which has no such effect. The

former as it produces a value, may be called productive, the latter,

unproductive labour. {Some French authors of great learning and

ingenuity have used those words in a different sense. In the last

chapter of the fourth book, I shall endeavour to shew that their sense

is an impro
er one.} Thus the labour of a manufacturer adds generally

to the value of the materials which he works upon, that of his own

maintenance, and of his master's profit. The labour of a menial servant,

on the contrary, adds to the value of nothing. Though the manufacturer

has his wages advanced to him by his master, he in reality costs him

no expense, the value of those wages being generally restored, together

with a profit, in the improved value of the subject upon which his

labour is bestowed. But the maintenance of a menial servant never is

restored. A man grows rich by employing a multitude of manufacturers; he

grows poor by maintaining a multitude or menial servants. The labour of

the latter, however, has its value, and deserves its reward as well

as that of the former. But the labour of the manufacturer fixes and

realizes itself in some particular subject or vendible commodity, which

lasts for some time at least after that labour is past. It is, as

it were, a certain quantity of labour stocked and stored up, to be

employed, if necessary, upon some other occasion. That subject, or,

what is the same thing, the price of that subject, can afterwards, if

necessary, put into motion a quantity of labour equal to that which

had originally produced it. The labour of the menial servant, on the

contrary, does not fix or realize itself in any particular subject or

vendible commodity. His services generally perish in the very instant of

their performance, and seldom leave any trace of value behind them, for

which an equal quantity of service could afterwards be procured.

The labour of some of the most respectable orders in the society is,

like that of menial servants, unproductive of any value, and does not

fix or realize itself in any permanent subject, or vendible commodity,

which endures after that labour is past, and for which an equal quantity

of labour could afterwards be procured. The sovereign, for example, with

all the officers both of justice and war who serve under him, the whole

army and navy, are unproductive labourers. They are the servants of

the public, and are maintained by a part of the annual produce of the

industry of other people. Their service, how honourable, how useful, or

how necessary soever, produces nothing for which an equal quantity

of service can afterwards be procured. The protection, security, and

defence, of the commonwealth, the effect of their labour this year,

will not purchase its protection, security, and defence, for the year

to come. In the same class must be ranked, some both of the gravest and

most important, and some of the most frivolous professions; churchmen,

lawyers, physicians, men of letters of all kinds; players, buffoons,

musicians, opera-singers, opera-dancers, etc. The labour of the meanest

of these has a certain value, regulated by the very same principles

which regulate that of every other sort of labour; and that of the

noblest and most useful, produces nothing which could afterwards

purchase or procure an equal quantity of labour. Like the declamation of

the actor, the harangue of the orator, or the tune of the musician, the

work of all of them perishes in the very instant of its production.

Both productive and unproductive labourers, and those who do not labour

at all, are all equally maintained by the annual produce of the land

and labour of the country. This produce, how great soever, can never

be infinite, but must have certain limits. According, therefore, as

a smaller or greater proportion of it is in any one year employed in

maintaining unproductive hands, the more in the one case, and the

less in the other, will remain for the productive, and the next year's

produce will be greater or smaller accordingly; the whole annual

produce, if we except the spontaneous productions of the earth, being

the effect of productive labour.

Though the whole annual produce of the land and labour of every country

is no doubt ultimately destined for supplying the consumption of its

inhabitants, and for procuring a revenue to them; yet when it first

comes either from the ground, or from the hands of the productive

labourers, it naturally divides itself into two parts. One of them, and

frequently the largest, is, in the first place, destined for replacing

a capital, or for renewing the provisions, materials, and finished work,

which had been withdrawn from a capital; the other for constituting a

revenue either to the owner of this capital, as the profit of his stock,

or to some other person, as the rent of his land. Thus, of the produce

of land, one part replaces the capital of the farmer; the other pays his

profit and the rent of the landlord; and thus constitutes a revenue both

to the owner of this capital, as the profits of his stock, and to

some other person as the rent of his land. Of the produce of a great

manufactory, in the same manner, one part, and that always the largest,

replaces the capital of the undertaker of the work; the other pays his

profit, and thus constitutes a revenue to the owner of this capital.

That part of the annual produce of the land and labour of any country

which replaces a capital, never is immediately employed to maintain any

but productive hands. It pays the wages of productive labour only. That

which is immediately destined for constituting a revenue, either as

profit or as rent, may maintain indifferently either productive or

unproductive hands.

Whatever part of his stock a man employs as a capital, he always expects

it to be replaced to him with a profit. He employs it, therefore,

in maintaining productive hands only; and after having served in the

function of a capital to him, it constitutes a revenue to them. Whenever

he employs any part of it in maintaining unproductive hands of any kind,

that part is from that moment withdrawn from his capital, and placed in

his stock reserved for immediate consumption.

Unproductive labourers, and those who do not labour at all, are all

maintained by revenue; either, first, by that part of the annual

produce which is originally destined for constituting a revenue to some

particular persons, either as the rent of land, or as the profits of

stock; or, secondly, by that part which, though originally destined for

replacing a capital, and for maintaining productive labourers only, yet

when it comes into their hands, whatever part of it is over and

above their necessary subsistence, may be employed in maintaining

indifferently either productive or unproductive hands. Thus, not only

the great landlord or the rich merchant, but even the common workman,

if his wages are considerable, may maintain a menial servant; or he may

sometimes go to a play or a puppet-show, and so contribute his share

towards maintaining one set of unproductive labourers; or he may pay

some taxes, and thus help to maintain another set, more honourable and

useful, indeed, but equally unproductive. No part of the annual produce,

however, which had been originally destined to replace a capital, is

ever directed towards maintaining unproductive hands, till after it has

put into motion its full complement of productive labour, or all that it

could put into motion in the way in which it was employed. The workman

must have earned his wages by work done, before he can employ any part

of them in this manner. That part, too, is generally but a small one. It

is his spare revenue only, of which productive labourers have seldom

a great deal. They generally have some, however; and in the payment of

taxes, the greatness of their number may compensate, in some measure,

the smallness of their contribution. The rent of land and the profits

of stock are everywhere, therefore, the principal sources from which

unproductive hands derive their subsistence. These are the two sorts

of revenue of which the owners have generally most to spare. They might

both maintain indifferently, either productive or unproductive hands.

They seem, however, to have some predilection for the latter. The

expense of a great lord feeds generally more idle than industrious

people. The rich merchant, though with his capital he maintains

industrious people only, yet by his expense, that is, by the employment

of his revenue, he feeds commonly the very same sort as the great lord.

The proportion, therefore, between the productive and unproductive

hands, depends very much in every country upon the proportion between

that part of the annual produce, which, as soon as it comes either from

the ground, or from the hands of the productive labourers, is destined

for replacing a capital, and that which is destined for constituting a

revenue, either as rent or as profit. This proportion is very different

in rich from what it is in poor countries.

Thus, at present, in the opulent countries of Europe, a very large,

frequently the largest, portion of the produce of the land, is destined

for replacing the capital of the rich and independent farmer; the other

for paying his profits, and the rent of the landlord. But anciently,

during the prevalency of the feudal government, a very small portion

of the produce was sufficient to replace the capital employed in

cultivation. It consisted commonly in a few wretched cattle, maintained

altogether by the spontaneous produce of uncultivated land, and which

might, therefore, be considered as a part of that spontaneous produce.

It generally, too, belonged to the landlord, and was by him advanced to

the occupiers of the land. All the rest of the produce properly belonged

to him too, either as rent for his land, or as profit upon this paltry

capital. The occupiers of land were generally bond-men, whose persons

and effects were equally his property. Those who were not bond-men were

tenants at will; and though the rent which they paid was often nominally

little more than a quit-rent, it really amounted to the whole produce

of the land. Their lord could at all times command their labour in

peace and their service in war. Though they lived at a distance from his

house, they were equally dependent upon him as his retainers who lived

in it. But the whole produce of the land undoubtedly belongs to him, who

can dispose of the labour and service of all those whom it maintains. In

the present state of Europe, the share of the landlord seldom exceeds a

third, sometimes not a fourth part of the whole produce of the land.

The rent of land, however, in all the improved parts of the country, has

been tripled and quadrupled since those ancient times; and this third

or fourth part of the annual produce is, it seems, three or four times

greater than the whole had been before. In the progress of improvement,

rent, though it increases in proportion to the extent, diminishes in

proportion to the produce of the land.

In the opulent countries of Europe, great capitals are at present

employed in trade and manufactures. In the ancient state, the little

trade that was stirring, and the few homely and coarse manufactures that

were carried on, required but very small capitals. These, however, must

have yielded very large profits. The rate of interest was nowhere less

than ten per cent. and their profits must have been sufficient to afford

this great interest. At present, the rate of interest, in the improved

parts of Europe, is nowhere higher than six per cent.; and in some of

the most improved, it is so low as four, three, and two per cent. Though

that part of the revenue of the inhabitants which is derived from the

profits of stock, is always much greater in rich than in poor countries,

it is because the stock is much greater; in proportion to the stock, the

profits are generally much less.

That part of the annual produce, therefore, which, as soon as it comes

either from the ground, or from the hands of the productive labourers,

is destined for replacing a capital, is not only much greater in rich

than in poor countries, but bears a much greater proportion to that

which is immediately destined for constituting a revenue either as

rent or as profit. The funds destined for the maintenance of productive

labour are not only much greater in the former than in the latter,

but bear a much greater proportion to those which, though they may

be employed to maintain either productive or unproductive hands, have

generally a predilection for the latter.

The proportion between those different funds necessarily determines in

every country the general character of the inhabitants as to industry or

idleness. We are more industrious than our forefathers, because, in the

present times, the funds destined for the maintenance of industry are

much greater in proportion to those which are likely to be employed in

the maintenance of idleness, than they were two or three centuries

ago. Our ancestors were idle for want of a sufficient encouragement to

industry. It is better, says the proverb, to play for nothing, than

to work for nothing. In mercantile and manufacturing towns, where the

inferior ranks of people are chiefly maintained by the employment of

capital, they are in general industrious, sober, and thriving; as

in many English, and in most Dutch towns. In those towns which are

principally supported by the constant or occasional residence of a

court, and in which the inferior ranks of people are chiefly maintained

by the spending of revenue, they are in general idle, dissolute, and

poor; as at Rome, Versailles, Compeigne, and Fontainbleau. If you except

Rouen and Bourdeaux, there is little trade or industry in any of the

parliament towns of France; and the inferior ranks of people, being

chiefly maintained by the expense of the members of the courts of

justice, and of those who come to plead before them, are in general idle

and poor. The great trade of Rouen and Bourdeaux seems to be altogether

the effect of their situation. Rouen is necessarily the entrepot of

almost all the goods which are brought either from foreign countries, or

from the maritime provinces of France, for the consumption of the great

city of Paris. Bourdeaux is, in the same manner, the entrepot of the

wines which grow upon the banks of the Garronne, and of the rivers which

run into it, one of the richest wine countries in the world, and which

seems to produce the wine fittest for exportation, or best suited to

the taste of foreign nations. Such advantageous situations necessarily

attract a great capital by the great employment which they afford it;

and the employment of this capital is the cause of the industry of those

two cities. In the other parliament towns of France, very little more

capital seems to be employed than what is necessary for supplying their

own consumption; that is, little more than the smallest capital which

can be employed in them. The same thing may be said of Paris, Madrid,

and Vienna. Of those three cities, Paris is by far the most industrious,

but Paris itself is the principal market of all the manufactures

established at Paris, and its own consumption is the principal object of

all the trade which it carries on. London, Lisbon, and Copenhagen, are,

perhaps, the only three cities in Europe, which are both the constant

residence of a court, and can at the same time be considered as trading

cities, or as cities which trade not only for their own consumption, but

for that of other cities and countries. The situation of all the three

is extremely advantageous, and naturally fits them to be the entrepots

of a great part of the goods destined for the consumption of distant

places. In a city where a great revenue is spent, to employ with

advantage a capital for any other purpose than for supplying the

consumption of that city, is probably more difficult than in one in

which the inferior ranks of people have no other maintenance but what

they derive from the employment of such a capital. The idleness of the

greater part of the people who are maintained by the expense of

revenue, corrupts, it is probable, the industry of those who ought to

be maintained by the employment of capital, and renders it less

advantageous to employ a capital there than in other places. There was

little trade or industry in Edinburgh before the Union. When the Scotch

parliament was no longer to be assembled in it, when it ceased to be the

necessary residence of the principal nobility and gentry of Scotland, it

became a city of some trade and industry. It still continues, however,

to be the residence of the principal courts of justice in Scotland,

of the boards of customs and excise, etc. A considerable revenue,

therefore, still continues to be spent in it. In trade and industry,

it is much inferior to Glasgow, of which the inhabitants are chiefly

maintained by the employment of capital. The inhabitants of a large

village, it has sometimes been observed, after having made considerable

progress in manufactures, have become idle and poor, in consequence of a

great lord's having taken up his residence in their neighbourhood.

The proportion between capital and revenue, therefore, seems everywhere

to regulate the proportion between industry and idleness Wherever

capital predominates, industry prevails; wherever revenue, idleness.

Every increase or diminution of capital, therefore, naturally tends

to increase or diminish the real quantity of industry, the number of

productive hands, and consequently the exchangeable value of the annual

produce of the land and labour of the country, the real wealth and

revenue of all its inhabitants.

Capitals are increased by parsimony, and diminished by prodigality and


Whatever a person saves from his revenue he adds to his capital,

and either employs it himself in maintaining an additional number of

productive hands, or enables some other person to do so, by lending

it to him for an interest, that is, for a share of the profits. As the

capital of an individual can be increased only by what he saves from his

annual revenue or his annual gains, so the capital of a society, which

is the same with that of all the individuals who compose it, can be

increased only in the same manner.

Parsimony, and not industry, is the immediate cause of the increase

of capital. Industry, indeed, provides the subject which parsimony

accumulates; but whatever industry might acquire, if parsimony did not

save and store up, the capital would never be the greater.

Parsimony, by increasing the fund which is destined for the maintenance

of productive hands, tends to increase the number of those hands whose

labour adds to the value of the subject upon winch it is bestowed.

It tends, therefore, to increase the exchangeable value of the annual

produce of the land and labour of the country. It puts into motion an

additional quantity of industry, which gives an additional value to the

annual produce.

What is annually saved, is as regularly consumed as what is annually

spent, and nearly in the same time too: but it is consumed by a

different set of people. That portion of his revenue which a rich man

annually spends, is, in most cases, consumed by idle guests and menial

servants, who leave nothing behind them in return for their consumption.

That portion which he annually saves, as, for the sake of the profit,

it is immediately employed as a capital, is consumed in the same manner,

and nearly in the same time too, but by a different set of people: by

labourers, manufacturers, and artificers, who reproduce, with a profit,

the value of their annual consumption. His revenue, we shall suppose,

is paid him in money. Had he spent the whole, the food, clothing,

and lodging, which the whole could have purchased, would have been

distributed among the former set of people. By saving a part of it,

as that part is, for the sake of the profit, immediately employed as a

capital, either by himself or by some other person, the food, clothing,

and lodging, which may be purchased with it, are necessarily reserved

for the latter. The consumption is the same, but the consumers are


By what a frugal man annually saves, he not only affords maintenance to

an additional number of productive hands, for that of the ensuing year,

but like the founder of a public work-house he establishes, as it were,

a perpetual fund for the maintenance of an equal number in all times to

come. The perpetual allotment and destination of this fund, indeed, is

not always guarded by any positive law, by any trust-right or deed of

mortmain. It is always guarded, however, by a very powerful principle,

the plain and evident interest of every individual to whom any share of

it shall ever belong. No part of it can ever afterwards be employed to

maintain any but productive hands, without an evident loss to the person

who thus perverts it from its proper destination.

The prodigal perverts it in this manner: By not confining his expense

within his income, he encroaches upon his capital. Like him who perverts

the revenues of some pious foundation to profane purposes, he pays

the wages of idleness with those funds which the frugality of his

forefathers had, as it were, consecrated to the maintenance of industry.

By diminishing the funds destined for the employment of productive

labour, he necessarily diminishes, so far as it depends upon him, the

quantity of that labour which adds a value to the subject upon which it

is bestowed, and, consequently, the value of the annual produce of the

land and labour of the whole country, the real wealth and revenue of

its inhabitants. If the prodigality of some were not compensated by the

frugality of others, the conduct of every prodigal, by feeding the

idle with the bread of the industrious, would tend not only to beggar

himself, but to impoverish his country.

Though the expense of the prodigal should be altogether in home made,

and no part of it in foreign commodities, its effect upon the productive

funds of the society would still be the same. Every year there would

still be a certain quantity of food and clothing, which ought to have

maintained productive, employed in maintaining unproductive hands. Every

year, therefore, there would still be some diminution in what would

otherwise have been the value of the annual produce of the land and

labour of the country.

This expense, it may be said, indeed, not being in foreign goods, and

not occasioning any exportation of gold and silver, the same quantity of

money would remain in the country as before. But if the quantity of

food and clothing which were thus consumed by unproductive, had been

distributed among productive hands, they would have reproduced, together

with a profit, the full value of their consumption. The same quantity

of money would, in this case, equally have remained in the country,

and there would, besides, have been a reproduction of an equal value of

consumable goods. There would have been two values instead of one.

The same quantity of money, besides, can not long remain in any country

in which the value of the annual produce diminishes. The sole use of

money is to circulate consumable goods. By means of it, provisions,

materials, and finished work, are bought and sold, and distributed to

their proper consumers. The quantity of money, therefore, which can be

annually employed in any country, must be determined by the value of

the consumable goods annually circulated within it. These must consist,

either in the immediate produce of the land and labour of the country

itself, or in something which had been purchased with some part of that

produce. Their value, therefore, must diminish as the value of that

produce diminishes, and along with it the quantity of money which can

be employed in circulating them. But the money which, by this annual

diminution of produce, is annually thrown out of domestic circulation,

will not be allowed to lie idle. The interest of whoever possesses it

requires that it should be employed; but having no employment at home,

it will, in spite of all laws and prohibitions, be sent abroad, and

employed in purchasing consumable goods, which may be of some use at

home. Its annual exportation will, in this manner, continue for some

time to add something to the annual consumption of the country beyond

the value of its own annual produce. What in the days of its prosperity

had been saved from that annual produce, and employed in purchasing

gold and silver, will contribute, for some little time, to support its

consumption in adversity. The exportation of gold and silver is, in this

case, not the cause, but the effect of its declension, and may even, for

some little time, alleviate the misery of that declension.

The quantity of money, on the contrary, must in every country naturally

increase as the value of the annual produce increases. The value of the

consumable goods annually circulated within the society being greater,

will require a greater quantity of money to circulate them. A part

of the increased produce, therefore, will naturally be employed in

purchasing, wherever it is to be had, the additional quantity of gold

and silver necessary for circulating the rest. The increase of those

metals will, in this case, be the effect, not the cause, of the public

prosperity. Gold and silver are purchased everywhere in the same manner.

The food, clothing, and lodging, the revenue and maintenance, of all

those whose labour or stock is employed in bringing them from the mine

to the market, is the price paid for them in Peru as well as in England.

The country which has this price to pay, will never belong without the

quantity of those metals which it has occasion for; and no country will

ever long retain a quantity which it has no occasion for.

Whatever, therefore, we may imagine the real wealth and revenue of a

country to consist in, whether in the value of the annual produce of its

land and labour, as plain reason seems to dictate, or in the quantity

of the precious metals which circulate within it, as vulgar prejudices

suppose; in either view of the matter, every prodigal appears to be a

public enemy, and every frugal man a public benefactor.

The effects of misconduct are often the same as those of prodigality.

Every injudicious and unsuccessful project in agriculture, mines,

fisheries, trade, or manufactures, tends in the same manner to diminish

the funds destined for the maintenance of productive labour. In every

such project, though the capital is consumed by productive hands only,

yet as, by the injudicious manner in which they are employed, they do

not reproduce the full value of their consumption, there must always be

some diminution in what would otherwise have been the productive funds

of the society.

It can seldom happen, indeed, that the circumstances of a great

nation can be much affected either by the prodigality or misconduct of

individuals; the profusion or imprudence of some being always more than

compensated by the frugality and good conduct of others.

With regard to profusion, the principle which prompts to expense is the

passion for present enjoyment; which, though sometimes violent and very

difficult to be restrained, is in general only momentary and occasional.

But the principle which prompts to save, is the desire of bettering

our condition; a desire which, though generally calm and dispassionate,

comes with us from the womb, and never leaves us till we go into the

grave. In the whole interval which separates those two moments, there is

scarce, perhaps, a single instance, in which any man is so perfectly and

completely satisfied with his situation, as to be without any wish of

alteration or improvement of any kind. An augmentation of fortune is the

means by which the greater part of men propose and wish to better their

condition. It is the means the most vulgar and the most obvious; and the

most likely way of augmenting their fortune, is to save and accumulate

some part of what they acquire, either regularly and annually, or upon

some extraordinary occasion. Though the principle of expense, therefore,

prevails in almost all men upon some occasions, and in some men upon

almost all occasions; yet in the greater part of men, taking the whole

course of their life at an average, the principle of frugality seems not

only to predominate, but to predominate very greatly.

With regard to misconduct, the number of prudent and successful

undertakings is everywhere much greater than that of injudicious

and unsuccessful ones. After all our complaints of the frequency of

bankruptcies, the unhappy men who fall into this misfortune, make but

a very small part of the whole number engaged in trade, and all other

sorts of business; not much more, perhaps, than one in a thousand.

Bankruptcy is, perhaps, the greatest and most humiliating calamity

which can befal an innocent man. The greater part of men, therefore, are

sufficiently careful to avoid it. Some, indeed, do not avoid it; as some

do not avoid the gallows.

Great nations are never impoverished by private, though they sometimes

are by public prodigality and misconduct. The whole, or almost the

whole public revenue is, in most countries, employed in maintaining

unproductive hands. Such are the people who compose a numerous and

splendid court, a great ecclesiastical establishment, great fleets and

armies, who in time of peace produce nothing, and in time of war acquire

nothing which can compensate the expense of maintaining them, even while

the war lasts. Such people, as they themselves produce nothing, are

all maintained by the produce of other men's labour. When multiplied,

therefore, to an unnecessary number, they may in a particular year

consume so great a share of this produce, as not to leave a sufficiency

for maintaining the productive labourers, who should reproduce it next

year. The next year's produce, therefore, will be less than that of the

foregoing; and if the same disorder should continue, that of the third

year will be still less than that of the second. Those unproductive

hands who should be maintained by a part only of the spare revenue of

the people, may consume so great a share of their whole revenue, and

thereby oblige so great a number to encroach upon their capitals, upon

the funds destined for the maintenance of productive labour, that

all the frugality and good conduct of individuals may not be able to

compensate the waste and degradation of produce occasioned by this

violent and forced encroachment.

This frugality and good conduct, however, is, upon most occasions, it

appears from experience, sufficient to compensate, not only the private

prodigality and misconduct of individuals, but the public extravagance

of government. The uniform, constant, and uninterrupted effort of

every man to better his condition, the principle from which public

and national, as well as private opulence is originally derived, is

frequently powerful enough to maintain the natural progress of things

towards improvement, in spite both of the extravagance of government,

and of the greatest errors of administration. Like the unknown principle

of animal life, it frequently restores health and vigour to the

constitution, in spite not only of the disease, but of the absurd

prescriptions of the doctor.

The annual produce of the land and labour of any nation can be increased

in its value by no other means, but by increasing either the number of

its productive labourers, or the productive powers of those labourers

who had before been employed. The number of its productive labourers,

it is evident, can never be much increased, but in consequence of an

increase of capital, or of the funds destined for maintaining them. The

productive powers of the same number of labourers cannot be increased,

but in consequence either of some addition and improvement to those

machines and instruments which facilitate and abridge labour, or of

more proper division and distribution of employment. In either case,

an additional capital is almost always required. It is by means of an

additional capital only, that the undertaker of any work can either

provide his workmen with better machinery, or make a more proper

distribution of employment among them. When the work to be done consists

of a number of parts, to keep every man constantly employed in one way,

requires a much greater capital than where every man is occasionally

employed in every different part of the work. When we compare,

therefore, the state of a nation at two different periods, and find that

the annual produce of its land and labour is evidently greater at the

latter than at the former, that its lands are better cultivated, its

manufactures more numerous and more flourishing, and its trade more

extensive; we may be assured that its capital must have increased during

the interval between those two periods, and that more must have been

added to it by the good conduct of some, than had been taken from

it either by the private misconduct of others, or by the public

extravagance of government. But we shall find this to have been the case

of almost all nations, in all tolerably quiet and peaceable times,

even of those who have not enjoyed the most prudent and parsimonious

governments. To form a right judgment of it, indeed, we must compare the

state of the country at periods somewhat distant from one another.

The progress is frequently so gradual, that, at near periods, the

improvement is not only not sensible, but, from the declension either

of certain branches of industry, or of certain districts of the country,

things which sometimes happen, though the country in general is in great

prosperity, there frequently arises a suspicion, that the riches and

industry of the whole are decaying.

The annual produce of the land and labour of England, for example, is

certainly much greater than it was a little more than a century ago, at

the restoration of Charles II. Though at present few people, I believe,

doubt of this, yet during this period five years have seldom passed

away, in which some book or pamphlet has not been published, written,

too, with such abilities as to gain some authority with the public,

and pretending to demonstrate that the wealth of the nation was fast

declining; that the country was depopulated, agriculture neglected,

manufactures decaying, and trade undone. Nor have these publications

been all party pamphlets, the wretched offspring of falsehood and

venality. Many of them have been written by very candid and very

intelligent people, who wrote nothing but what they believed, and for no

other reason but because they believed it.

The annual produce of the land and labour of England, again, was

certainly much greater at the Restoration than we can suppose it to have

been about a hundred years before, at the accession of Elizabeth. At

this period, too, we have all reason to believe, the country was much

more advanced in improvement, than it had been about a century before,

towards the close of the dissensions between the houses of York and

Lancaster. Even then it was, probably, in a better condition than it had

been at the Norman conquest: and at the Norman conquest, than during

the confusion of the Saxon heptarchy. Even at this early period, it was

certainly a more improved country than at the invasion of Julius Caesar,

when its inhabitants were nearly in the same state with the savages in

North America.

In each of those periods, however, there was not only much private and

public profusion, many expensive and unnecessary wars, great perversion

of the annual produce from maintaining productive to maintain

unproductive hands; but sometimes, in the confusion of civil discord,

such absolute waste and destruction of stock, as might be supposed, not

only to retard, as it certainly did, the natural accumulation of riches,

but to have left the country, at the end of the period, poorer than at

the beginning. Thus, in the happiest and most fortunate period of them

all, that which has passed since the Restoration, how many disorders

and misfortunes have occurred, which, could they have been foreseen, not

only the impoverishment, but the total ruin of the country would have

been expected from them? The fire and the plague of London, the two

Dutch wars, the disorders of the revolution, the war in Ireland, the

four expensive French wars of 1688, 1701, 1742, and 1756, together with

the two rebellions of 1715 and 1745. In the course of the four French

wars, the nation has contracted more than £145,000,000 of debt, over and

above all the other extraordinary annual expense which they occasioned;

so that the whole cannot be computed at less than £200,000,000. So great

a share of the annual produce of the land and labour of the country,

has, since the Revolution, been employed upon different occasions, in

maintaining an extraordinary number of unproductive hands. But had not

those wars given this particular direction to so large a capital, the

greater part of it would naturally have been employed in maintaining

productive hands, whose labour would have replaced, with a profit, the

whole value of their consumption. The value of the annual produce of the

land and labour of the country would have been considerably increased by

it every year, and every years increase would have augmented still more

that of the following year. More houses would have been built, more

lands would have been improved, and those which had been improved before

would have been better cultivated; more manufactures would have been

established, and those which had been established before would have been

more extended; and to what height the real wealth and revenue of the

country might by this time have been raised, it is not perhaps very easy

even to imagine.

But though the profusion of government must undoubtedly have retarded

the natural progress of England towards wealth and improvement, it has

not been able to stop it. The annual produce of its land and labour

is undoubtedly much greater at present than it was either at the

Restoration or at the Revolution. The capital, therefore, annually

employed in cultivating this land, and in maintaining this labour,

must likewise be much greater. In the midst of all the exactions of

government, this capital has been silently and gradually accumulated

by the private frugality and good conduct of individuals, by their

universal, continual, and uninterrupted effort to better their own

condition. It is this effort, protected by law, and allowed by liberty

to exert itself in the manner that is most advantageous, which has

maintained the progress of England towards opulence and improvement in

almost all former times, and which, it is to be hoped, will do so in all

future times. England, however, as it has never been blessed with a

very parsimonious government, so parsimony has at no time been the

characteristic virtue of its inhabitants. It is the highest impertinence

and presumption, therefore, in kings and ministers to pretend to watch

over the economy of private people, and to restrain their expense,

either by sumptuary laws, or by prohibiting the importation of foreign

luxuries. They are themselves always, and without any exception, the

greatest spendthrifts in the society. Let them look well after their own

expense, and they may safely trust private people with theirs. If their

own extravagance does not ruin the state, that of the subject never


As frugality increases, and prodigality diminishes, the public capital,

so the conduct of those whose expense just equals their revenue, without

either accumulating or encroaching, neither increases nor diminishes it.

Some modes of expense, however, seem to contribute more to the growth of

public opulence than others.

The revenue of an individual may be spent, either in things which

are consumed immediately, and in which one day's expense can neither

alleviate nor support that of another; or it may be spent in things mere

durable, which can therefore be accumulated, and in which every day's

expense may, as he chooses, either alleviate, or support and heighten,

the effect of that of the following day. A man of fortune, for example,

may either spend his revenue in a profuse and sumptuous table, and in

maintaining a great number of menial servants, and a multitude of

dogs and horses; or, contenting himself with a frugal table, and few

attendants, he may lay out the greater part of it in adorning his house

or his country villa, in useful or ornamental buildings, in useful or

ornamental furniture, in collecting books, statues, pictures; or in

things more frivolous, jewels, baubles, ingenious trinkets of different

kinds; or, what is most trifling of all, in amassing a great wardrobe of

fine clothes, like the favourite and minister of a great prince who died

a few years ago. Were two men of equal fortune to spend their revenue,

the one chiefly in the one way, the other in the other, the magnificence

of the person whose expense had been chiefly in durable commodities,

would be continually increasing, every day's expense contributing

something to support and heighten the effect of that of the following

day; that of the other, on the contrary, would be no greater at the end

of the period than at the beginning. The former too would, at the end of

the period, be the richer man of the two. He would have a stock of goods

of some kind or other, which, though it might not be worth all that

it cost, would always be worth something. No trace or vestige of the

expense of the latter would remain, and the effects of ten or twenty

years' profusion would be as completely annihilated as if they had never


As the one mode of expense is more favourable than the other to the

opulence of an individual, so is it likewise to that of a nation. The

houses, the furniture, the clothing of the rich, in a little time,

become useful to the inferior and middling ranks of people. They are

able to purchase them when their superiors grow weary of them; and the

general accommodation of the whole people is thus gradually improved,

when this mode of expense becomes universal among men of fortune.

In countries which have long been rich, you will frequently find the

inferior ranks of people in possession both of houses and furniture

perfectly good and entire, but of which neither the one could have been

built, nor the other have been made for their use. What was formerly

a seat of the family of Seymour, is now an inn upon the Bath road. The

marriage-bed of James I. of Great Britain, which his queen brought

with her from Denmark, as a present fit for a sovereign to make to

a sovereign, was, a few years ago, the ornament of an alehouse at

Dunfermline. In some ancient cities, which either have been long

stationary, or have gone somewhat to decay, you will sometimes scarce

find a single house which could have been built for its present

inhabitants. If you go into those houses, too, you will frequently find

many excellent, though antiquated pieces of furniture, which are still

very fit for use, and which could as little have been made for them.

Noble palaces, magnificent villas, great collections of books, statues,

pictures, and other curiosities, are frequently both an ornament and an

honour, not only to the neighbourhood, but to the whole country to which

they belong. Versailles is an ornament and an honour to France, Stowe

and Wilton to England. Italy still continues to command some sort of

veneration, by the number of monuments of this kind which it possesses,

though the wealth which produced them has decayed, and though the genius

which planned them seems to be extinguished, perhaps from not having the

same employment.

The expense, too, which is laid out in durable commodities, is

favourable not only to accumulation, but to frugality. If a person

should at any time exceed in it, he can easily reform without exposing

himself to the censure of the public. To reduce very much the number

of his servants, to reform his table from great profusion to great

frugality, to lay down his equipage after he has once set it up, are

changes which cannot escape the observation of his neighbours, and which

are supposed to imply some acknowledgment of preceding bad conduct. Few,

therefore, of those who have once been so unfortunate as to launch

out too far into this sort of expense, have afterwards the courage to

reform, till ruin and bankruptcy oblige them. But if a person has, at

any time, been at too great an expense in building, in furniture, in

books, or pictures, no imprudence can be inferred from his changing

his conduct. These are things in which further expense is frequently

rendered unnecessary by former expense; and when a person stops short,

he appears to do so, not because he has exceeded his fortune, but

because he has satisfied his fancy.

The expense, besides, that is laid out in durable commodities, gives

maintenance, commonly, to a greater number of people than that which is

employed in the most profuse hospitality. Of two or three hundred weight

of provisions, which may sometimes be served up at a great festival, one

half, perhaps, is thrown to the dunghill, and there is always a great

deal wasted and abused. But if the expense of this entertainment had

been employed in setting to work masons, carpenters, upholsterers,

mechanics, etc. a quantity of provisions of equal value would have

been distributed among a still greater number of people, who would

have bought them in pennyworths and pound weights, and not have lost

or thrown away a single ounce of them. In the one way, besides, this

expense maintains productive, in the other unproductive hands. In the

one way, therefore, it increases, in the other it does not increase the

exchangeable value of the annual produce of the land and labour of the


I would not, however, by all this, be understood to mean, that the one

species of expense always betokens a more liberal or generous spirit

than the other. When a man of fortune spends his revenue chiefly in

hospitality, he shares the greater part of it with his friends

and companions; but when he employs it in purchasing such durable

commodities, he often spends the whole upon his own person, and gives

nothing to any body without an equivalent. The latter species of

expense, therefore, especially when directed towards frivolous objects,

the little ornaments of dress and furniture, jewels, trinkets, gew-gaws,

frequently indicates, not only a trifling, but a base and selfish

disposition. All that I mean is, that the one sort of expense, as it

always occasions some accumulation of valuable commodities, as it is

more favourable to private frugality, and, consequently, to the increase

of the public capital, and as it maintains productive rather than

unproductive hands, conduces more than the other to the growth of public