infringes more or less upon the natural order of things; and yet I should not hesitate to say, that the worst system of laws is preferable to no government at all. Art, we have observed, is natural to man; it is the result of reason, and leads him onwards in the progressive path of improvement. Instead of being chained down like the brute creation by instinct, he is free to follow where inclination leads. But as soon as he enters into a state of society, he feels the necessity of a control which nature has not imposed, and his reason enables him to devise one. He enacts laws which are more or less conducive to his good, in proportion as his rational faculties are developed and cultivated. Many of these laws, no doubt, are inimical to his welfare; yet the balance upon the whole is in their favour; the single law of the institution of property has conferred greater benefit on mankind than all the evils which spring from the worst system of government.

CAROLINE.

But this level this equality of profits to which you say every branch of industry naturally tends, cannot yet have taken place in England, since manufactures and trade are here allowed to yield greater profits than agriculture.

MRS. B.

You are mistaken in that opinion. It is true that it is more common to see merchants and manufacturers accumulate large and rapid fortunes than farmers. They are a class who generally employ capital upon a more extensive scale, hence their riches make a greater show. Yet, in the long run, trade and manufactures do not yield greater profits than agriculture.

CAROLINE.

I cannot understand why the merchant and manufacturer should grow richer than the farmer, unless they make larger profits.

MRS. B.

You must observe, that though a farmer does not so frequently and rapidly amass wealth as a merchant, neither is he so often ruined. The risks a man encounters in trade are much greater than in farming. The merchant is liable to severe losses arising from contingencies in trade which scarcely affect the farmer, such as war, changes of fashion, and bad debts; he must therefore have a chance of making proportionally greater profits.

CAROLINE.

That is to say that the chances of gain must balance the chances of loss?

MRS. B.

If

Yes; the merchant plays for a larger stake. therefore he be so skilful or so fortunate as to make more than his average share of gains, he will accumulate wealth with greater rapidity than a farmer; but should either a deficiency of talents or of fortunate circumstances occasion an uncommon share of losses, be may become a bankrupt.

CAROLINE.

But, Mrs. B., you should, on the other hand, consider that the farmer is exposed to the risk attending the uncertainty of the seasons; a cause which is continually operating, and over which he has no control.

MRS. B.

Yet, in these climates, the losses occasioned by such causes are seldom attended with ruinous consequences; for seasons which prove unfavourable to one kind of produce are often advantageous to another. And, besides, the produce of agriculture consisting chiefly of the necessaries of life, the demand for it cannot well be diminished, and the price rises, not only in proportion to the scarcity but even higher; so that farmers are said sometimes to make the greatest gains in a bad harvest.

We may then conclude that though agriculture, manufactures, and trade, do upon the whole afford similar profits, these profits are, amongst farmers, more equally shared than amongst merchants and manufacturers; some of whom amass immense wealth, whilst others become bankrupts.

The rate of profit, therefore, upon any employment of capital is, generally speaking, proportioned to the risks with which it is attended; but if calculated during a sufficient period of time, and upon a sufficient number of instances, to afford an average, all these different modes of employing capital will be found to yield similar profits.

It is thus that the distribution of capital amongst the several branches of agriculture, manufactures, and trade, preserves a due equilibrium; which, though it may be accidentally disturbed, cannot, whilst allowed to pursue its natural course, be permanently deranged.

CAROLINE.

If this is the case one ought never to wish to interfere with the natural distribution of capital.

MRS. B.

You must not, however, consider this general equality of profits as being fixed and invariable, even in countries where government does not interfere with the direction of capital; it is frequently deranged by a variety of disturbing causes. The invention of any new branch of industry, or the improvement of an old one, will raise the profits of capital invested in it; but no sooner is this discovered, than others, who have capital that can be diverted to the new employment, engage in this advantageous concern, and competition reduces the profits to their due proportion. The opening of a trade with a new country, or the breaking out of a war which impedes foreign commerce, will affect the profits of the merchant: but these accidents disturb the equal rate of profits as the winds disturb the sea; and when they cease, it returns to its natural level.

CAROLINE.

So then, though profits have always a tendency to equalization, it seems there are as many disturbing causes to prevent their attaining it as there is with the sea; and even if they should succeed, the level cannot be permanent.

MRS. B.

That is true. To-morrow we shall examine how an income is derived from land.

200

CONVERSATION XIII.

ON INCOME DERIVED FROM PROPERTY IN LAND.

RENT THE EFFECT, NOT THE CAUSE, OF THE HIGH PRICE OF AGRICULTURAL PRODUCE CAUSES OF RENT: 1. THE FERTILITY OF THE EARTH; 2. DIVERSITY OF SOIL AND SITUATION REQUIRING DIFFERENT DEGREES OF EXPENSE TO RAISE SIMILAR PRODUCE. ORIGIN OF RENT. — RENT INCREASES POSITIVELY IN A PROGRESSIVE COUNtry, and DIMINISHES RELATIVELY. -HIGH PRICE OF RAW PRODUCE NECESSARY TO PROPORTION THE DEMAND TO THE SUPPLY.

CAROLINE.

I HAVE been reflecting much upon the subject of income, Mrs. B.; but I cannot comprehend how farmers can afford to pay their rent if they do not make more than the usual profits of capital. I had imagined that they began by raising greater produce from the same capital than merchants or manufacturers, but that the deduction of their rent eventually reduced their profits below those of other branches of industry.

MRS. B

You were right in the first part of your conjecture; but how did you account for the folly of farmers in choosing a mode of employing their capital which,