Book I. Chap. vii. Sect. 4. Farmers' soils, if the return from those soils, in spite of the increasing skill and augmented power of the agriculturists, be still less than the return from the old soils before was, the permanent rise of produce Increase of rents from this cause will be measured by the dif- Rents. ference between the return to a certain quantity of capital and labor from the new soils, and the return to the same quantity of capital and labor from the worst of the old soils. If on A, a quality of soil, paying no rent, a certain quantity of labor and capital produces 55 quarters of corn, and on B a soil worse than A, the same quantity of labor and capital can produce only 53 quarters, then when the demand for corn, and the rise in its relative value becomes such that B can be cultivated, and pay the ordinary profits of stock, A will pay a rent of two quarters of corn: for B, which produces 53 quarters, returning the ordinary profits of stock, 4, which produces 55 quarters, must return the ordinary profits of stock, and also two quarters of corn; which two quarters, or the price of them, will become surplus profits or rent. It will be obvious that the rise of rents in this case, forms no addition to the resources of a country. The increased rents of the old soils are a mere transfer of a portion of the wealth already existing from the producing classes to the landlords: the nation, collectively, is neither richer nor poorer than it was; there has only been a change, and by no means a desirable change, in the distribution of wealth which it already possessed. In this Chap. vii. Sect. 4. BOOK I. respect, as in many others, a rise of rents from this cause contrasts, much to its disadvantage, with a rise from the two causes of which we first analyzed Increase of the operation. Farmers' But the apprehensions which have been entertained, as to a necessary falling off in the returns to capital and labor generally, which it has been supposed must always follow a diminution in the returns to agricultural industry on the worst soils cultivated, are happily extravagant and groundless. Such a diminution in the power of agricultural industry, though a possible event, takes place in the progress of a wealthy people very rarely. I doubt if it ever takes place at all; and when it does takes place, we must not hastily conclude that because the quantity of corn remaining in the hands of the producing agricultural classes is diminished, there must therefore be a fall either in profits or wages, or that such producing classes would have the means of consuming either less corn, or less of any other commodity, than they did before the reduction of their share in the produce of the soil. For these conclusions, which look at first very like truths, are in fact fallacious, as a short examination will shew us. The decreasing Fertility of Soils may be balanced by the increased Efficiency of manufacturing Labor. Human industry is not wholly employed in producing raw produce: and its increasing efficiency Book I. Chap. vii. Sect. 4. Increased facturing in other departments may balance, and more than balance, the decreasing powers of agriculture: may enable the society to spare the additional proportion of men and capital required to produce an Efficiency undiminished quantity of food for increasing num- of Manubers, and that without lessening the mass of wealth Labor. enjoyed by any class of men. This will appear more clearly from an example or two to which I solicit the reader's attention, as containing the proof of a fact very important to be understood, in examining the possible progress of human society, after population has become dense, and capital and the arts have made great progress. Let us first take the simplest case which involves the principle we wish to explain, and let us suppose ten shipwrecked mariners cast on some uninhabited shore, and dividing between them the task of providing their common food, clothing, and shelter. During the first year, let the exertions of five men be sufficient to supply their table, and the exertions of the other five their food, raiment, &c. In the next year, food may have become more scarce, and the time of eight of the men may be occupied in procuring it. But in the mean time, the skill of the artisan division may have so improved, that two men may be able to secure to the whole party the same quantity of clothing, shelter, &c. that before engrossed the industry of five. In this case, fourfifths of the laboring hands will be occupied in procuring food, instead of one-half as before. Still the consumption of articles of every description will remain the same throughout the little community. Sect. 4. BOOK I. We may put the case yet stronger. If one man Chap. vii. became able to supply the clothing, &c. they might spare nine to go in quest of food, and might acIncreased tually consume more food, and as much of every thing else, as they did while food was more easily procured. Efficiency of Manu facturing Labor. Let us next observe, what effects would be produced by a similar change in the productive powers of different classes of the community, if such change occurred among a people whose social relations were less simple than those of the knot of men we have been figuring to ourselves, and let us suppose a community consisting of 24 men, employed, onehalf in producing corn, and one-half in producing cloth. Let corn, for our present purpose, represent all the varieties of raw produce, and cloth all commodities produced by the national industry which are distinct from raw produce. Let the corn-growers produce 14 quarters of corn, and the cloth-makers 14 pieces of cloth, of each of which let 12 go to wages and 2 to profits. Then, if each party exchange half their produce with the other division, every laborer in each will have half a quarter of corn, and half a piece of cloth; and their two employers will have a piece of cloth and a quarter of corn each. Next, let us suppose this laboring population doubled that there are 48 laborers instead of 24, and that to produce double the quantity of corn, it has become necessary, from the decreasing fertility of the fresh soils resorted to, to employ in agriculture, not double the number of men formerly Sect. 4. Efficiency facturing employed, but more than double; say three times Book I. the number, or 36 men. Then, by the supposition, Chap. vii. 36 men produce double the quantity of corn before produced, or 28 quarters. In the mean while, let Increased the productive powers of the cloth-workers have so of Manuincreased, that to produce double the former quan- Labor. tity of cloth, the labor of double the number of men is not necessary, but of a less number, say of 12: then by the supposition, 12 men will produce double the former quantity of cloth, or 28 pieces. But as 36 men produce 28 quarters of corn, while 12 men produce 28 pieces of cloth, each quarter of corn will exchange for three pieces of cloth'. Between the 48 men, there will be to be divided 28 quarters of corn, and 28 pieces of cloth, which will give them their old wages of half a quarter of corn, and half a piece of cloth each, and will also leave four quarters of corn and four pieces of cloth as profits. But the capitalist cloth-worker, employing only one-fourth of the men, will take only one-fourth of the profit, or one piece of cloth and one quarter of corn. The corn-grower, employing three-fourths of the men, will take three-fourths of the profit, or three quarters of corn and three pieces of cloth. As the rate of wages remains precisely what it was, so will the rate of profits: for each employer of 12 men, at the old wages, will 1 It would complicate the calculation, if we were to take in here any elements of exchangeable value besides the mere labor employed: and to demonstrate the truth we are travelling to, that complicated calculation is not necessary. |