Theschool，inasmuchas，injudgingtheinfluencesofclimate
ontheproductionofwealth，ithasnotdistinguishedbetween
agricultureandmanufacturingindustry，hasfallenintothegravest
errorsinrespecttotheadvantagesanddisadvantagesofprotective
regulations，whichwecannothereomitthoroughlytoexpose，
althoughwehavealreadymadementionofthemingeneralterms
elsewhere。
Inordertoprovethatitisfoolishtoseektoproduce
everythinginoneandthesamecountry，theschoolasksthe
question：whetheritwouldbereasonableifwesoughttoproduce
winebygrowinggrapesinScottishandEnglishgreenhouses？Itis
ofcoursepossibletoproducewineinthismanner，onlyltwouldbe
ofmuchworsequalityandmoreexpensivethanthatwhichEngland
andScotlandcouldprocureinexchangefortheirmanufactured
goods。Toanyonewhoeitherisunwillingorunabletopenetrate
moredeeplyintothenatureofthings，thisargumentisastriking
one，andtheschoolisindebtedtoitforalargeportionofits
popularity；atanyrateamongtheFrenchvinegrowersandsilk
manufacturers，andamongtheNorthAmericancottonplantersand
cottonmerchants。Regardedinthelightofday，however，itis
fundamentallyfalse，sincerestrictionsoncommercialintercourse
operatequitedifferentlyontheproductivepowerofagriculture
thantheydoontheproductivepowerofmanufacturingindustry。
Letusfirstseehowtheyoperateonagriculture。
IfFrancerejectsfromherfrontiersGermanfatcattle，or
corn，whatwillsheeffectthereby？Inthefirstplace，Germany
willtherebybeunabletobuyFrenchwines。Francewilltherefore
havetousethoseportionsofhersoilwhicharefittedforthe
cultivationofthevinelessprofitablyinproportionasthis
destructionofcommercialinterchangelessensherexportationof
wines。Somanyfewerpersonswillbeexclusivelyoccupiedwiththe
cultivationofthevine，andthereforesomuchlessnative
agriculturalproductswillberequired，whichthesepersonswould
haveconsumed，whowouldhaveotherwisedevotedthemselves
exclusivelytovineculture。Thiswillbethecaseinthe
productionofoilaswellasinthatofwine。Francewilltherefore
alwaysloseinheragriculturalpoweronotherpointsmuchmore
thanshegainsononesinglepoint，becausebyherexclusionofthe
Germancattlesheprotectsatradeintherearingandfatteningof
cattlewhichhadnotbeenspontaneouslydeveloped，andforwhich，
therefore，probablytheagricultureofthosedistrictswherethis
branchofindustryhashadtobeartificiallydevelopedisnot
adapted。ThuswillitbeifweconsiderFrancemerelyasan
agriculturalStateopposedtoGermanyasamerelyagricultural
State，andifwealsoassumethatGermanywillnotretaliateon
thatpolicybyasimilarone。Thispolicy，however，appearsstill
moreinjuriousifweassumethatGermany，asshewillbecompelled
tooutofregardtoherowninterests，adoptssimilarlyrestrictive
measures，andifweconsiderthatFranceisnotmerelyan
agricultural，butalsoamanufacturingState。Germanywill，namely，
notmerelyimposehigherdutiesonFrenchwines，butonallthose
FrenchproductswhichGermanyeitherproducesherself，orcanmore
orlessdowithout，orprocureelsewhere；shewillfurtherrestrict
theimportationofthosemanufacturedgoodswhichshecannotat
presentproducewithspecialbenefit，butwhichshecanprocure
fromotherplacesthanfromFrance。ThedisadvantagewhichFrance
hasbroughtuponherselfbythoserestrictions，thusappearstwice
orthreetimesgreaterthantheadvantage。Itisevidentthatin
Franceonlysomanypersonscanbeemployedinthecultivationof
thevine，inthecultivationofolives，andinmanufacturing
industry，asthemeansofsubsistence，andrawmaterialswhich
Franceeitherproducesherselforprocuresfromabroad，areableto
supportandemploy。Butwehaveseenthattherestrictionof
importationhasnotincreasedtheagriculturalproduction，buthas
merelytransferreditfromonedistricttoanother。Iffreecourse
hadbeenpermittedtotheinterchangeofproducts，theimportation
ofproductsandrawmaterials，andconsequentlythesaleofwine，
oil，andmanufacturedgoods，wouldhavecontinuallyincreased，and
consequentlythenumberofpersonsemployedinthecultivationof
thevineandolives，andinmanufactures；whilewiththeincreasing
traffic，ontheonehand，themeansofsubsistenceandraw
materials，and，ontheotherhand，thedemandforhermanufactured
products，wouldhaveaugmented。Theaugmentationofthispopulation
wouldhaveproducedalargerdemandforthoseprovisionsandraw
materialswhichcannoteasilybeimportedfromabroad，andfor
whichthenativeagriculturepossessesanaturalmonopoly；the
nativeagriculturethereforewouldthushaveobtainedafargreater
profit。Thedemandforthoseagriculturalproductsforwhichthe
characteroftheFrenchsoilisspeciallyadapted，wouldbemuch
moreconsiderableunderthisfreeinterchangethanthatproduced
artificiallybyrestriction。Oneagriculturistwouldnothavelost
whatanothergained；thewholeagricultureofthecountrywould
havegained，butstillmorethemanufacturingindustry。Through
restriction，theagriculturalpowerofthecountrythereforeisnot
increased，butlimited；andbesidesthis，thatmanufacturingpower
isannihilatedwhichwouldhavegrownupfromtheaugmentationof
theinternalagriculture，aswellasfromtheforeignimportation
ofprovisionsandrawmaterials。Allthathasbeenattainedthrough
therestrictionisanincreaseofpricesinfavourofthe
agriculturistsofonedistrictattheexpenseoftheagriculturists
ofanotherdistrict，butaboveall，attheexpenseofthetotal
productiveforceofthecountry。
Thedisadvantagesofsuchrestrictionsontheinterchangeof
productsarestillmoreclearlybroughttolightinthecaseof
EnglandthaninthatofFrance。Throughthecornlaws，ondoubt，a
quantityofunfertilelandisbroughtundercultivation；butitis
aquestionwhethertheselandswouldnothavebeenbroughtunder
cultivationwithoutthem。Themorewool，timber，cattle，andcorn
thatEnglandwouldhaveimported，themoremanufacturedgoodswould
shehavesold，thegreaternumberofworkmenwouldhavebeen
enabledtoliveinEngland，thehigherwouldtheprosperityofthe
workingclasseshaverisen。Englandwouldprobablyhavedoubledthe
numberofherworkmen。Everysingleworkmanwouldhavelived
better，wouldhavebeenbetterabletocultivateagardenforhis
pleasureandfortheproductionofusefulvegetables，andwould
havesupportedhimselfandhisfamilymuchbetter。Itisevident
thatsuchalargeaugmentationoftheworkingpopulation，aswell
asofitsprosperityandoftheamountofwhatitconsumed，would
haveproducedanenormousdemandforthoseproductsforwhichthe
islandpossessesanaturalmonopoly，anditismorethanprobable
thattherebydoubleandthreetimesasmuchlandcouldhavebeen
broughtintocultivationthanbyunnaturalrestrictions。Theproof
ofthismaybeseeninthevicinityofeverylargetown。However
largethemassofproductsmaybewhichisbroughtintothistown
fromdistantdistrictsformilesaroundit，onecannotdiscovera
singletractoflanduncultivated，howevermuchthatlandmayhave
beenneglectedbynature。Ifyouforbidtheimportationintosuch
atownofcornfromdistantdistricts，youtherebymerelyeffecta
diminutionofitspopulation，ofitsmanufacturingindustry，and
itsprosperity，andcompelthefarmerwholivesnearthetownto
devotehimselftolessprofitableculture。
Itwillbeperceivedthatthusfarwearequiteinaccordwith
theprevailingtheory。Withregardtotheinterchangeofraw
products，theschoolisperfectlycorrectinsupposingthatthe
mostextensivelibertyofcommerceis，underallcircumstances，
mostadvantageoustotheindividualaswellastotheentireState。
Onecan，indeed，augmentthisproductionbyrestrictions；butthe
advantageobtainedtherebyismerelyapparent。Weonlythereby
divert，astheschoolsays，capitalandlabourintoanotherand
lessusefulchannel。Butthemanufacturingproductivepower，onthe
contrary，isgovernedbyotherlaws，whichhave，unfortunately，
entirelyescapedtheobservationoftheschool。
Ifrestrictionontheimportationofrawproductshinderaswe
haveseentheutilisationofthenaturalresourcesandpowersof
aState，restrictionsontheimportationofmanufacturedgoods，on
thecontrary，callintolifeandactivityinthecaseofa
populouscountryalreadyfaradvancedinagricultureand
civilisationamassofnaturalpowers；indeed，withoutdoubt，the
greaterhalfofallnaturalpowers，whichinthemerely
agriculturalStatelieidleanddeadforever。If，ontheonehand，
restrictionsontheimportationofrawproductsareahindranceto
thedevelopmentnotonlyofthemanufacturing，butalsoofthe
agriculturalproductive，powersofaState，ontheotherhand，an
internalmanufacturingproductivepowerproducedbyrestrictionson
theimportationofforeignmanufactures，stimulatesthewhole
agriculturalproductivepowersofaStatetoadegreewhichthe
mostflourishingforeigntradeisneverabletodo。Ifthe
importationofrawproductsmakestheforeigncountrydependenton
usandtakesfromitthemeansofmanufacturingforitself，soin
likemanner，bytheimportationofforeignmanufactures，arewe
rendereddependentontheforeigncountry，andthemeansaretaken
fromusofmanufacturingforourselves。Iftheimportationof
productsandrawmaterialswithdrawsfromtheforeigncountrythe
materialfortheemploymentandsupportofitspopulationand
divertsittoournation，sodoestheimportationofmanufactured
fabricstakefromustheopportunityofincreasingourown
populationandofprovidingitwithemployment。Iftheimportation
ofnaturalproductsandrawmaterialsincreasestheinfluenceof
ournationontheaffairsoftheworldandgivesusthemeansof
carryingoncommercewithallothernationsandcountries，soby
theimportationofmanufacturedfabricsarewechainedtothemost
advancedmanufacturingnation，whichcanruleoverusalmostasit
pleases，asEnglandrulesoverPortugal。Inshort，historyand
statisticsalikeprovethecorrectnessofthedictumexpressedby
theministersofGeorgeI：thatnationsarericherandmore
powerfulthemoretheyexportmanufacturedgoods，andimportthe
meansofsubsistenceandrawmaterials。Infact，itmaybeproved
thatentirenationshavebeenruinedmerelybecausetheyhave
exportedonlymeansofsubsistenceandrawmaterials，andhave
importedonlymanufacturedgoods。Montesquieu，1*whounderstood
betterthananyoneeitherbeforeorafterhimhowtolearnfrom
Historythelessonswhichsheimpartstothelegislatorand
politician，haswellperceivedthis，althoughitwasimpossiblefor
himinhistimes，whenpoliticaleconomywasasyetbutlittle
studied，clearlytounfoldthecausesofit。Incontradictionto
thegroundlesssystemofthephysiocraticschool，hemaintained
thatPolandwouldbemoreprosperousifshegaveupaltogether
foreigncommerce，i。e。ifsheestablishedamanufacturingpowerof
herown，andworkedupandconsumedherownrawmaterialsandmeans
ofsubsistence。Onlybythedevelopmentofaninternal
manufacturingpower，byfree，populous，andindustriouscities，
couldPolandobtainastronginternalorganisation，national
industry，liberty，andwealth；onlythuscouldshemaintainher
independenceandpoliticalsuperiorityoverlesscultivated
neighbours。Insteadofforeignmanufacturedgoodssheshouldhave
introducedasEnglanddidatonetime，whenshewasonthesame
footingasregardsculturewithPolandforeignmanufacturersand
foreignmanufacturingcapital。Heraristocracy，however，preferred
toexportthepaltryfruitsofserflabourtoforeignmarkets，and
toobtaininreturnthecheapandfinegoodsmadebyforeign
countries。Theirsuccessorsnowmayanswerthequestion：whetherit
isadvisableforanationtobuythefabricsofaforeigncountry
solongasitsownnativemanufacturesarenotyetsufficiently
strengthenedtobeabletocompeteinpricesandqualitywiththe
foreigner。Thearistocracyofothercountriesmaybearherfatein
mindwhenevertheyareinstigatedbyfeudalinclinations；theymay
thencastaglanceattheEnglisharistocracyinordertoinform
themselvesastowhatisthevaluetothegreatlandedproprietors
ofastrengthenedmanufacturingpower，offreemunicipal
institutions，andofwealthytowns。
Withouthereenteringonaninquirywhetheritwouldhavebeen
possiblefortheelectivekingsofPoland，underthecircumstances
underwhichtheywereplaced，tointroducesuchacommercialsystem
asthehereditarykingsofEnglandhavegraduallydevelopedand
established，letusimaginethatithadbeendonebythem：canwe
notperceivewhatrichfruitssuchasystemwouldhaveyieldedto
thePolishnation？Bytheaidoflargeandindustrioustowns，the
crownwouldhavebeenrenderedhereditary，thenobilitywouldhave
beenobligedtomakeitconvenienttotakepartinlegislationin
aHouseofPeers，andtoemancipatetheirserfs；agriculturewould
havedevelopeditself，asithasdevelopeditselfinEngland；the
Polishnobilitywouldnowberichandrespected；thePolishnation
would，evenifnotsorespectedandinfluentialintheaffairsof
theworldastheEnglishnationis，wouldhavelongagobecomeso
civilisedandpowerfulastoextenditsinfluenceovertheless
cultivatedEast。Withoutamanufacturingpowershehasbecome
ruinedandpartitioned，andwereshenotsoalreadyshemusthave
becomeso。Ofitsownaccordandspontaneouslynomanufacturing
powerwasdevelopedinher；itcouldnotbeso，becauseitsefforts
wouldhavebeenalwaysfrustratedbyfurtheradvancednations。
Withoutasystemofprotection，andunderasystemoffreetrade
withfurtheradvancednations，evenifPolandhadretainedher
independenceuptothepresenttime，shecouldneverhavecarried
onanythingmorethanacrippledagriculture；shecouldneverhave
becomerich，powerful，andoutwardlyinfluential。
Bythecircumstancethatsomanynaturalresourcesandnatural
powersareconvertedbythemanufacturingpowerintoproductive
capitalisthefactchieflytobeaccountedfor，thatprotective
regulationsactsopowerfullyontheaugmentationofnational
wealth。Thisprosperityisnotafalseappearance，liketheeffects
ofrestrictionsonthetradeinmerenaturalproducts，itisa
reality。Theyarenaturalpowerswhichareotherwisequitedead——
naturalresourceswhichareotherwisequitevalueless，whichan
agriculturalnationcallstolifeandrendersvaluableby
establishingamanufacturingpowerofitsown。
Itisanoldobservation，thatthehumanrace，likethevarious
breedsofanimals，isimprovedmentallyandbodilybycrossings；
thatman，ifafewfamiliesalwaysintermarryamongstoneanother，
justastheplantiftheseedisalwayssowninthesamesoil，
graduallydegenerates。Weseemobligedtoattributetothislawof
naturethecircumstancethatamongmanywildorhalf-wildtribesin
AfricaandAsia，whosenumbersarelimited，themenchoosetheir
wivesfromforeigntribes。Thefactwhichexperienceshows，that
theoligarchiesofsmallmunicipalrepublics，whocontinually
intermarryamongthemselves，graduallydieoutorvisibly
degenerate，appearssimilarlyattributabletosuchanaturallaw。
Itisundeniablethatthemixingoftwoquitedifferentraces
results，almostwithoutexception，inapowerfulandfinefuture
progeny；andthisobservationextendstothemixingofthewhite
racewiththeblackinthethirdandthefourthgeneration。This
observationseemstoconfirmmorethananyotherthingthefact，
thatthosenationswhichhaveemanatedfromacrossingofrace
frequentlyrepeatedandcomprisingthewholenation，havesurpassed
allothernationsinpowerandenergyofthemindandcharacter，in
intelligence，bodilystrength，andpersonalbeauty。2*
Wethinkwemayconcludefromthisthatmenneednot
necessarilybesuchdull，clumsy，andunintellectualbeingsaswe
perceivethemtobewhenoccupiedincrippledagricultureinsmall
villages，whereafewfamilieshaveforthousandsofyears
intermarriedonlywithoneanother；whereforcenturiesithas
occurredtonoonetomakeuseofanimplementofanewform，orto
adoptanewmethodofculture，toalterthestyleofasingle
articleofclothing，ortoadoptanewidea；wherethegreatestart
consisted，notinexertingone\'sbodilyandmentalpowersinorder
toobtainasmuchenjoymentaspossible，buttodispensewithas
muchofitaspossible。
Thisconditionofthingsisentirelychangedandforthebest
purposesoftheimprovementofraceofawholenationby
establishingamanufacturingpower。Whilealargeportionofthe
increaseoftheagriculturalpopulationgoesoverintothe
manufacturingcommunity，whiletheagriculturalpopulationof
variousdistrictsbecomesmixedbymarriagesbetweenoneanother
andwiththemanufacturingpopulation，themental，moral，and
physicalstagnationofthepopulationisbrokenup。Theintercourse
whichmanufacturesandthecommercebetweenvariousnationsand
districtswhichisbaseduponthembringabout，bringsnewblood
intothewholenationaswellasintoseparatecommunitiesand
families。
Thedevelopmentofthemanufacturingpowerhasnoless
importantaninfluenceontheimprovementofthebreedsofcattle。
Everywhere，wherewoollenmanufactureshavebeenestablished，the
raceofsheephasquicklybeenimproved。Owingtoagreaterdemand
forgoodmeat，whichanumerousmanufacturingpopulationcreates，
theagriculturistwillendeavourtointroducebetterbreedsof
cattle。Thegreaterdemandfor\'horsesofluxury\'isfollowedby
theimprovementofthebreedsofhorses。Weshallthennolonger
seethosewretchedprimitivebreedsofcattle，horses，andsheep，
whichhavingresultedfromthecrippledstateofagricultureand
everywherefromneglectofcrossingofbreeds，exhibitaside
spectacleworthyoftheirclumsyowners。
Howmuchdotheproductivepowersofthenationsalreadyoweto
theimportationofforeignbreedsofanimalsandtotheimprovement
ofthenativebreeds；andhowmuchhasyettobedoneinthis
respect！AllthesilkwormsofEuropearederivedfromafeweggs，
whichunderConstantinewerebroughttoConstantinopleinhollow
sticks，byGreekmonksfromChina，wheretheirexportationwas
strictlyprohibited。Franceisindebtedtotheimportationofthe
Thibetgoatforabeautifulproductofherindustry。Itisvery
muchtoberegretted，thathithertothebreedingandimprovingof
animalshasbeenchieflycarriedoninordertosatisfythe
requirementsofluxury，andnotinordertopromotethewelfareof
thelargemasses。Thedescriptionsoftravellersshowthatinsome
countriesofAsiaaraceofcattlehasbeenseenwhichcombines
considerabledraughtpowerwithgreatswiftnessofpace，sothat
theycanbeusedwithalmostthesameadvantageashorsesfor
ridinganddriving。Whatimmenseadvantageswouldsuchabreedof
cattleconferonthesmalleragriculturistsofEurope！Whatan
increaseinmeansofsubsistence，productivepower，and
convenience，wouldtheworkingclassestherebyobtain！Butevenfar
morethanbyimprovedbreeds，andimportationfromonecountryinto
anotherofvariousanimals，hastheproductivepowerofthehuman
racebeenincreasedbytheimprovementandimportationoftreesand
plants。Thisisatonceevident，ifwecomparetheoriginalplants
astheyhavesprungfromthebosomofnature，withtheirimproved
species。Howlittledotheprimitiveplantsofthevariousspecies
ofcornandoffruittrees，ofediblevegetablesandoftheolive，
resembleinformandutilitytheirimprovedoffspring！Whatmasses
ofmeansofnourishment，ofenjoyment，andcomfort，andwhat
opportunitiesfortheusefulapplicationofhumanpowers，havebeen
derivedfromthem！Thepotato，thebeet-root，thecultivationof
rootcropsforcattle，togetherwiththeimprovedsystemsof
manuringandimprovedagriculturalmachines，haveincreased
ten-foldthereturnsofagriculture，asitisatpresentcarriedon
bytheAsiatictribes。
Sciencehasalreadydonemuchwithregardtothediscoveryof
newplantsandtheimprovementofthem；butgovernmentshavenot
yetdevotedtothisimportantobjectsomuchattentionasthey
oughttohavedone，intheinterestsofeconomy。Quiterecently，
speciesofgrassaresaidtohavebeendiscoveredinthesavannas
ofNorthAmerica，whichfromthepoorestsoilyieldahigher
producethananyfodderplants，whichareasyetknowntous，do
fromtherichestsoil。Itisveryprobablethatinthewildregions
ofAmerica，Asia，Africa，andAustralia，aquantityofplantsstill
vegetateuselessly，thetransplantationandimprovementofwhich
mightinfinitelyaugmenttheprosperityoftheinhabitantsof
temperateclimates。
Itisclearthatmostoftheimprovementsandtransportations
ofanimalsandvegetables，mostofthenewdiscoverieswhichare
madewithrespecttothem，aswellasallotherprogress，
inventions，anddiscoveries，arechieflycalculatedtobenefitthe
countriesofthetemperatezone，andofthosemostofall，the
manufacturingcountries。
NOTES：
1。EspritdesLois，Livrexx。chap。xxiii。
2。AccordingtoChardin，theGuebres，anunmixedtribeoftheold
Persians，areanugly，deformed，andclumsyrace，likeallnations
ofMongoldescent，whilethePersiannobility，whichforcenturies
hasintermarriedwithGeorgianandCircassianwomen，is
distinguishedforbeautyandstrength。DrPritchardremarksthat
theunmixedCeltsoftheScottishhighlandsarefarbehindthe
ScottishLowlandersdescendantsofSaxonsandCeltsinheight，
bodilypower，andfinefigure。Pallasmakessimilarobservations
respectingthedescendantsoftheRussiansandTartarsin
comparisonwiththeunmixedtribestowhichtheyarerelated。Azara
affirmsthatthedescendantsoftheSpaniardsandthenativesof
Paraguayareamuchmorehandsomeandpowerfulraceofmenthan
theirancestorsonbothsides。Theadvantagesofthecrossingof
racearenotonlyapparentinthemixingofdifferentnations，but
alsointhemixingofdifferentfamilystocksinoneandthesame
nation。ThustheCreolenegroesfarsurpassthosenegroeswhohave
sprungfromunmixedtribes，andwhohavecomedirectfromAfricato
America，inmentalgiftsaswellasinbodilypower。The
Caribbeans，theonlyIndianracewhichchoosesregularlyitswomen
Fromneighbouringtribes，areineveryrespectsuperiortoall
otherAmericantribes。Ifthisisalawofnature，theriseand
progresswhichthecitiesoftheMiddleAgesdisplayedshortly
aftertheirfoundation，aswellastheenergyandfinebodily
appearanceoftheAmericanpeople，arehencepartlyexplained。
Chapter19
TheManufacturingPowerandtheInstrumentalPowersMaterial
CapitalOftheNation
Thenationderivesitsproductivepowerfromthementaland
physicalpowersoftheindividuals；fromtheirsocial，municipal，
andpoliticalconditionsandinstitutions；fromthenatural
resourcesplacedatitsdisposal，orfromtheinstrumentsit
possessesasthematerialproductsofformermentalandbodily
exertionsmaterial，agricultural，manufacturing，andcommercial
capital。Inthelasttwochapterswehavedealtwiththeinfluence
ofmanufacturesonthethreefirst-namedsourcesofthenational
productivepowers；thepresentandthefollowingchapterare
devotedtothedemonstrationofitsinfluenceontheonelast
named。
Thatwhichweunderstandbytheterm\'instrumentalpowers\'is
called\'capital\'bytheschool。Itmattersbutlittlebywhatword
anobjectissignified，butitmattersverymuchespeciallywith
regardtoscientificinvestigationsthatthewordselectedshould
alwaysindicateoneandthesameobject，andnevermoreorless。As
often，therefore，asdifferentbranchesofamatterarediscussed，
thenecessityforadistinctionarises。Theschoolnowunderstands
bytheterm\'capital\'notmerelythematerial，butalsoallmental
andsocialmeansofandaidstoproduction。Itclearlyought，
therefore，tospecifywhereveritspeaksofcapital，whetherthe
materialcapital，thematerialinstrumentsofproduction，orthe
mentalcapital，themoralandphysicalpowerswhichareinherentin
individuals，orwhichindividualsderivefromsocial，municipal，
andpoliticalconditions，aremeant。Theomissionofthis
distinction，whereitoughttobedrawn，mustnecessarilyleadto
falsereasoning，orelseservetoconcealfalsereasoning。
Meanwhile，however，asitisnotsomuchourbusinesstofounda
newnomenclatureastoexposetheerrorscommittedunderthecover
ofaninexactandinadequatenomenclature，wewilladopttheterm
\'capital，\'butdistinguishbetweenmentalandmaterialcapital，
betweenmaterial，agricultural，manufacturing，andcommercial
capital，betweenprivateandnationalcapital。
AdamSmithbymeansofthecommonexpression，capitalurges
thefollowingargumentagainsttheprotectivecommercialpolicy
whichisadoptedtothepresentdaybyallhisfollowers：\'A
countrycanindeedbymeansofsuchprotectiveregulations
produceaspecialdescriptionofmanufacturessoonerthanwithout
them；andthisspecialkindofmanufactureswillbeabletoyield
aftersometimeascheaporstillcheaperproductionsthanthe
foreigncountry。Butalthoughinthismannerwecansucceedin
directingnationalindustrysoonerintothosechannelsintowhich
itwouldlaterhaveflowedofitsownaccord，itdoesnotinthe
leastfollowthatthetotalamountofindustryoroftheincomesof
thecommunitycanbeincreasedbymeansofsuchmeasures。The
industryofthecommunitycanonlybeaugmentedinproportionas
itscapitalincreases，andthecapitalofthecommunitycanonly
increaseinaccordancewiththesavingswhichitgraduallymakes
fromitsincome。Now，theimmediateeffectofthesemeasuresisto
decreasetheincomeofthecommunity。Butitiscertainthatthat
whichdecreasesthatincomecannotincreasethecapitalmore
quicklythanitwouldhavebeenincreasedbyitself，ifit，aswell
asindustry，hadbeenleftfree。\'1*
Asaproofofthisargument，thefounderoftheschooladduces
thewell-knownexample，refutedbyusinthepreviouschapter，how
foolishitwouldbetoplantthevineinScotland。
Inthesamechapterhestates，theannualincomeofthe
communityisnothingelsebutthevalueinexchangeofthose
objectswhichthenationalindustryproducesannually。
Intheabove-namedargumentliesthechiefproofoftheschool
againsttheprotectivecommercialpolicy。Itadmitsthatby
measuresofprotectionmanufactoriescanbeestablishedandenabled
toproducemanufacturedgoodsascheaporevencheaperthanthey
canbeobtainedfromabroad；butitmaintainsthattheimmediate
effectofthesemeasuresistodecreasetheincomeofthecommunity
thevalueinexchangeofthosethingswhichthenationalindustry
producesannually。Ittherebyweakensitspowerofacquiring
capital，forcapitalisformedbythesavingswhichthenation
makesoutofitsannualincome；thetotalofthecapital，however，
determinesthetotalofthenationalindustry，andthelattercan
onlyincreaseinproportiontotheformer。Itthereforeweakensits
industrybymeansofthosemeasures——byproducinganindustry
which，inthenatureofthings，iftheyhadbeenlefttotheirown
freecoursewouldhaveoriginatedofitsownaccord。
Itisfirstlytoberemarkedinoppositiontothisreasoning，
thatAdamSmithhasmerelytakenthewordcapitalinthatsensein
whichitisnecessarilytakenbyrentiersormerchantsintheir
book-keepingandtheirbalance-sheets，namely，asthegrandtotal
oftheirvaluesofexchangeincontradistinctiontotheincome
accruingtherefrom。
Hehasforgottenthathehimselfincludesinhisdefinitionof
capitalthementalandbodilyabilitiesoftheproducersunder
thisterm。
Hewronglymaintainsthattherevenuesofthenationare
dependentonlyonthesumofitsmaterialcapital。Hisownwork，on
thecontrarycontainsathousandproofsthattheserevenuesare
chieflyconditionalonthesumofitsmentalandbodilypowers，and
onthedegreetowhichtheyareperfected，insocialandpolitical
respectsespeciallybymeansofmoreperfectdivisionoflabour
andconfederationofthenationalproductivepowers，andthat
althoughmeasuresofprotectionrequiresacrificesofmaterial
goodsforatime，thesesacrificesaremadegoodahundred-foldin
powers，intheabilitytoacquirevaluesofexchange，andare
consequentlymerelyreproductiveoutlaybythenation。
Hehasforgottenthattheabilityofthewholenationto
increasethesumofitsmaterialcapitalconsistsmainlyinthe
possibilityofconvertingunusednaturalpowersintomaterial
capital，intovaluableandincome-producinginstruments，andthat
inthecaseofthemerelyagriculturalnationamassofnatural
powersliesidleordeadwhichcanbequickenedintoactivityonly
bymanufactures。Hehasnotconsideredtheinfluenceof
manufacturesontheinternalandexternalcommerce，onthe
civilisationandpowerofthenation，andonthemaintenanceofits
independence，aswellasonthecapabilityarisingfromtheseof
gainingmaterialwealth。
Hehase。g。nottakenintoconsiderationwhatamassofcapital
theEnglishhaveobtainedbymeansofcolonisationMartin
estimatestheamountofthisatmorethantwoandahalfmilliards
ofpoundssterling。
He，whoneverthelesselsewhereprovessoclearlythatthe
capitalemployedinintermediatecommerceisnottoberegardedas
belongingtoanygivennation，solongasitisnotequally
embodiedinthatnation\'sland，hasherenotdulyconsideredthat
thenationalisationofsuchcapitalismosteffectuallyrealisedby
favouringthenation\'sinlandmanufactures。
Hehasnottakenintoaccount，thatbythepolicyoffavouring
nativemanufactureamassofforeigncapital，mentalaswellas
material，isattractedintothecountry。
Hefalselymaintainsthatthesemanufactureshaveoriginatedin
thenaturalcourseofthingsandoftheirownaccord；
notwithstandingthatineverynationthepoliticalpowerinterferes
togivetothisso-callednaturalcourseanartificialdirection
forthenation\'sownspecialadvantage。
Hehasillustratedhisargument，foundedonanambiguous
expressionandconsequentlyfundamentallywrong，byafundamentally
wrongexample，inseekingtoprovethatbecauseitwouldbefoolish
toproducewineinScotlandbyartificialmethods，thereforeit
wouldbefoolishtoestablishmanufacturesbyartificialmethods。
Hereducestheprocessoftheformationofcapitalinthe
nationtotheoperationofaprivaterentier，whoseincomeis
determinedbythevalueofhismaterialcapital，andwhocanonly
increasehisincomebysavingswhichheagainturnsintocapital。
Hedoesnotconsiderthatthistheoryofsavings，whichinthe
merchant\'sofficeisquitecorrect，iffollowedbyawholenation
mustleadtopoverty，barbarism，powerlessness，anddecayof
nationalprogress。Whereeveryonesavesandeconomisesasmuchas
hepossiblycan，nomotivecanexistforproduction。Whereeveryone
merelytakesthoughtfortheaccumulationofvaluesofexchange，
thementalpowerrequiredforproductionvanishes。Anation
consistingofsuchinsanemiserswouldgiveupthedefenceofthe
nationfromfearoftheexpensesofwar，andwouldonlylearnthe
truthafterallitspropertyhadbeensacrificedtoforeign
extortion，thatthewealthofnationsistobeattainedinamanner
differenttothatoftheprivaterentier。
Theprivaterentierhimself，asthefatherofafamily，must
followatotallydifferenttheorytotheshopkeepertheoryofthe
materialvaluesofexchangewhichisheresetup。Hemustatleast
expendontheeducationofhisheirsasmuchvalueofexchangeas
willenablethemtoadministerthepropertywhichissomedayto
falltotheirlot。
Thebuildingupofthematerialnationalcapitaltakesplacein
quiteanothermannerthanbymeresavingasinthecaseofthe
rentier，namely，inthesamemannerasthebuildingupofthe
productivepowers，chieflybymeansofthereciprocalaction
betweenthementalandmaterialnationalcapital，andbetweenthe
agricultural，manufacturing，andcommercialcapital。
Theaugmentationofthenationalmaterialcapitalisdependent
ontheaugmentationofthenationalmentalcapital，andvicevers？
Theformationofthematerialagriculturalcapitalisdependent
ontheformationofthematerialmanufacturingcapital，andvice
vers？
Thematerialcommercialcapitalactseverywhereasan
intermediary，helpingandcompensatingbetweenboth。
Intheuncivilisedstate，inthestateofthehunterandthe
fisher，thepowersofnatureyieldalmosteverything，capitalis
almostnil。Foreigncommerceincreasesthelatter，butalsoinso
doingthroughfire-arms，powder，leadtotallydestroysthe
productivenessoftheformer。Thetheoryofsavingscannotprofit
thehunter；hemustberuinedorbecomeashepherd。
Inthepastoralstatethematerialcapitalincreasesquickly，
butonlysofarasthepowersofnatureaffordspontaneously
nourishmenttothecattle。Theincreaseofpopulation，however，
followscloselyupontheincreaseofflocksandherdsandofthe
meansofsubsistence。Ontheonehand，theflocksandherdsaswell
aspasturesbecomedividedintosmallershares；ontheotherhand，
foreigncommerceoffersinducementstoconsumption。Itwouldbein
vaintopreachtothepastoralnationthetheoryofsavings；it
mustsinkintopovertyorpassoverintotheagriculturalState。
Totheagriculturalnationisopenanimmense，butatthesame
timelimited，fieldforenrichingitselfbyutilisingthedormant
powersofnature。
Theagriculturistforhimselfalonecansaveprovisions，
improvehisfields，increasehiscattle；buttheincreaseofthe
meansofsubsistencealwaysfollowstheincreaseofpopulation。The
materialcapitalnamely，cultivatedlandandcattle，in
proportionastheformerbecomesmorefertileandthelatter
increase，becomesdividedamongalargernumberofpersons。
Inasmuch，however，asthesurfaceofthelandcannotbeincreased
byindustry，andthelandcannotbeutiliseduptothemeasureof
itsnaturalcapacity，forwantofmeansoftransport，whichaswe
showedintheprecedingchaptermustremainimperfectinsucha
stateofthingsowingtolackofintercourse；andasmoreoverthe
merelyagriculturalnationismostlyinwantofthoseinstruments，
intelligence，motivestoexertion，andalsoofthatenergyand
socialdevelopmentwhichareimpartedtothenationthrough
manufacturesandthecommercewhichoriginatesfromthem，themere
agriculturalpopulationsoonreachesapointinwhichtheincrease
ofmaterialagriculturalcapitalcannolongerkeeppacewiththe
increaseofpopulation，andwhereconsequentlyindividualpoverty
increasesmoreandmore，notwithstandingthatthetotalcapitalof
thenationiscontinuallyincreasing。
Insuchaconditionthemostimportantproductofthenation
consistsofmen，who，astheycannotfindsufficientsupportin
theirowncountry，emigratetoothercountries。Itcanbebut
littleconsolationtosuchacountry，thattheschoolregardsman
asanaccumulatedcapital；fortheexportationofmendoesnot
occasionreturnfreights，but，onthecontrary，causesthe
unproductiveexportofconsiderableamountsofmaterialvaluesin
theshapeofimplements，utensils，money，&c。。
Itisclearthatinsuchastateofthings，wherethenational
divisionoflabourisnotproperlydeveloped，neitherindustrynor
economycanbringabouttheaugmentationofthematerialcapital
materialenrichmentofindividuals。
Theagriculturalcountryis，ofcourse，rarelyquitewithout
anyforeigncommerce，andforeigncommerce，asfarasitextends，
alsosuppliestheplaceofinternalmanufactureswithregardtothe
augmentationofcapital，inasmuchasitplacesthemanufacturerof
theforeigncountryincommercialrelationwiththeagriculturist
ofthehomecountry。This，however，takesplaceonlypartiallyand
veryimperfectly；firstly，becausethiscommerceextendsmerelyto
specialstapleproducts，andchieflyonlytothosedistrictswhich
aresituatedonthesea-coastandonnavigablerivers；and
secondly，becauseitisinanycasebutaveryirregularone，and
isliabletobefrequentlyinterruptedbywars，fluctuationsin
tradeandchangesincommerciallegislation，byspeciallyrich
harvests，andbyforeignimportations。
Theaugmentationofthematerialagriculturalcapitalcanonly
takeplaceonalargescale，withregularityandcontinuously，if
acompletelydevelopedmanufacturingpowerisestablishedinthe
midstoftheagriculturists。
Byfarthegreatestportionofthematerialcapitalofanation
isboundtoitslandandsoil。Ineverynationthevalueoflanded
property，ofdwellinghousesinruraldistrictsandintowns，of
workshops，manufactories，waterworks，mines，&c。amountstofrom
two-thirdstonine-tenthsoftheentirepropertyofthenation。It
mustthereforebeacceptedasarule，thatallthatincreasesor
decreasesthevalueofthefixedproperty，increasesordecreases
thetotalofthematerialcapitalofthenation。Now，itisevident
thatthecapitalvalueoflandofequalnaturalfertilityis
incomparablylargerintheproximityofasmalltownthaninremote
districts；thatthisvalueisincomparablylargerstillinthe
neighbourhoodofalargetownthaninthatofasmallone；andthat
inmanufacturingnationsthesevaluesarebeyondallcomparison
greaterthaninmereagriculturalnations。Wemayobserve
inverselythatthevalueofthedwellinghousesandmanufacturing
buildingsintowns，andthatofbuildingland，risesorfallsas
aruleinthesameratioinwhichthecommercialintercourseof
thetownwiththeagriculturistsisextendedorrestricted，orin
whichtheprosperityoftheseagriculturistsprogressesorrecedes。
Fromthisitisevidentthattheaugmentationoftheagricultural
capitalisdependentontheaugmentationofthemanufacturing
capital；andinverselythelatterontheformer。2*
Thisreciprocalactionis，however，inthecaseofthechange
fromtheagriculturalstateintothemanufacturingstatemuch
strongeronthepartofmanufacturethanonthepartof
agriculture。Forastheincreaseofcapitalwhichresultsfromthe
changefromtheconditionofthemerehuntertothepastoral
conditionischieflyeffectedbytherapidincreaseofflocksand
herds，astheincreaseofcapitalresultingfromthechangefrom
thepastoralconditionintotheagriculturalconditionischiefly
effectedbytherapidincreaseincultivatedlandandinsurplus
produce，so，intheeventofachangefromtheagricultural
conditionintothemanufacturingcondition，istheaugmentationof
thematerialcapitalofthenationchieflyeffectedbythosevalues
andpowerswhicharedevotedtotheestablishmentofmanufactures，
becausetherebyamassofformerlyunutilisednaturalandmental
powersareconvertedintomentalandmaterialcapital。Farfrom
hinderingthesavingofmaterialcapital，theestablishmentof
manufacturesisthefirstthingwhichaffordstothenationthe
meansofemployingitsagriculturalsavingsinaneconomical
manner，anditisthefirstmeansbywhichthenationcanbe
incitedtoagriculturaleconomy。
InthelegislativebodiesofNorthAmericaithasoftenbeen
mentionedthatcornthererotsintheearfromwantofsale，
becauseitsvaluewillnotpaytheexpenseofharvestingit。In
Hungaryitisassertedthattheagriculturistisalmostchokedwith
excessofproduce，whilemanufacturedgoodsarethreetofourtimes
dearertherethaninEngland。Germanyevencanremembersuchtimes。
InagriculturalStates，therefore，allsurplusagriculturalproduce
isnotmaterialcapital。Bymeansofmanufacturesitfirstbecomes
commercialcapitalbybeingwarehoused，andthenbybeingsoldto
themanufacturersitisturnedintomanufacturingcapital。Whatmay
beunutilisedstockinthehandoftheagriculturist，becomes
productivecapitalinthehandofthemanufacturer，andvicevers？
Productionrendersconsumptionpossible，andthedesireto
consumeincitestoproduction。Themereagriculturalnationisin
itsconsumptiondependentonforeignconditions，andiftheseare
notfavourabletoit，thatproductiondiesoutwhichwouldhave
ariseninconsequenceofthedesiretoconsume。Butinthatnation
whichcombinesmanufactureswithagricultureinitsterritory，the
reciprocalinducementcontinuallyexists，andtherefore，also，
therewillbecontinuousincreaseofproductionandwithit
augmentationofcapitalonbothsides。
Astheagricultural-manufacturingnationisforthereasons
whichwehavealreadygivenalwaysincomparablyricherinmaterial
capitalthanthemereagriculturalnationwhichisevidentata
glance，sointheformertherateofinterestisalwaysmuch
lower，andlargercapitalandmorefavourableconditionsareatthe
disposalofmenofenterprise，thaninthepurelyagricultural
nation。Itfollowsthattheformercanalwaysvictoriouslycompete
withthenewlyformedmanufactoriesintheagriculturalnation；
thattheagriculturalnationremainscontinuallyindebttothe
manufacturingnation，andthatinthemarketsoftheformer
continualfluctuationsinthepricesofproduceandmanufactured
goodsandinthevalueofmoneytakeplace，wherebythe
accumulationofmaterialwealthinthepurelyagriculturalnation
isnolessendangeredthanitsmoralityanditshabitsofeconomy。
Theschooldistinguishesfixedcapitalfromcirculating
capital，andclassesundertheformerinamostremarkablemanner
amultitudeofthingswhichareincirculationwithoutmakingany
practicalapplicationwhateverofthisdistinction。Theonlycase
inwhichsuchadistinctioncanbeofvalue，itpassesbywithout
notice。Thematerialaswellasthementalcapitalisnamely
boundinagreatmeasuretoagriculture，tomanufactures，to
commerce，ortospecialbranchesofeither——nayoften，indeed，to
speciallocalities。Fruittrees，whencutdown，areclearlynotof
thesamevaluetothemanufacturerifheusesthemforwoodwork
astheyaretotheagriculturistifheusesthemforthe
productionoffruit。Sheep，if，ashasalreadyfrequentlyhappened
inGermanyandNorthAmerica，theyhavetobeslaughteredin
masses，haveevidentlynotthevaluewhichtheywouldpossesswhen
usedfortheproductionofwool。Vineyardshaveassuchavalue
which，ifusedasarablefields，theywouldlose。Ships，ifused
fortimberorforfirewood，haveamuchlowervaluethanwhenthey
serveasmeansoftransport。Whatusecanbemadeofmanufacturing
buildings，water-power，andmachineryifthespinningindustryis
ruined？Inlikemannerindividualslose，asarule，thegreatest
partoftheirproductivepower，consistinginexperience，habits，
andskill，whentheyaredisplaced。Theschoolgivestoallthese
objectsandpropertiesthegeneralnameofcapital，andwould
transplantthembyvirtueofthisterminologyatitspleasure
fromonefieldofemploymenttoanother。J。B。Saythusadvisesthe
Englishtodiverttheirmanufacturingcapitaltoagriculture。How
thiswonderistobeaccomplishedhehasnotinformedus，andit
hasprobablyremainedasecrettoEnglishstatesmentothepresent
day。Sayhasinthisplaceevidentlyconfoundedprivatecapital
withnationalcapital。Amanufacturerormerchantcanwithdrawhis
capitalfrommanufacturesorfromcommercebysellinghisworksor
hisshipsandbuyinglandedpropertywiththeproceeds。Awhole
nation，however，couldnoteffectthisoperationexceptby
sacrificingalargeportionofitsmaterialandmentalcapital。The
reasonwhytheschoolsodeliberatelyobscuresthingswhichareso
clearisapparentenough。Ifthingsarecalledbytheirproper
names，itiseasilycomprehendedthatthetransferofthe
productivepowersofanationfromonefieldofemploymentto
anotherissubjecttodifficultiesandhazardswhichdonotalways
speakinfavourof\'freetrade，\'butveryofteninfavourof
nationalprotection。
NOTES：
1。WealthofNations，bookIV。chap。ii。
2。Comparethefollowingparagraph，whichappearedintheTimes
during1883：
\'MANUFACTURESANDAGRICULTURE。Thestatisticianofthe
AgriculturalDepartmentoftheUnitedStateshasshowninarecent
reportthatthevalueoffarmlandsdecreasesinexactproportion
astheratioofagriculturetootherindustriesincreases。Thatis，
whereallthelabourisdevotedtoagriculture，thelandisworth
lessthanwhereonlyhalfofthepeoplearefarmlabourers，and
whereonlyaquarterofthemaresoengagedthefarmsandtheir
productsarestillmorevaluable。Itis，infact，provedby
statisticsthatdiversifiedindustriesareofthegreatestvalueto
aState，andthatthepresenceofamanufactorynearafarm
increasesthevalueofthefarmanditscrops。Itisfurther
establishedthat，dividingtheUnitedStatesintofoursectionsor
classes，withreferencetotheratioofagriculturalworkerstothe
wholepopulation，andputtingthoseStateshavinglessthan30per
centofagriculturallabourersinthefirstclass，allhavingover
30andlessthan50inthesecond，thosebetween50and70inthe
third，andthosehaving70ormoreinthefourth，thevalueof
farmsisininverseratiototheagriculturalpopulation；andthat，
whereasinthepurelyagriculturalsection，thefourthclass，the
valueofthefarmsperacreisonly$528c，inthenextclassitis
$1303c，inthethird$2221c，andinthemanufacturingdistricts
$4091c。Thisshowsanenormousadvantageforamixeddistrict。Yet
notonlyisthelandmorevaluable——theproductionperacreis
greater，andthewagespaidtofarmhandslarger。Manufacturesand
variedindustriesthusnotonlybenefitthemanufacturers，butare
ofequalbenefitandadvantagetothefarmersaswell。Thelatter
would，therefore，dowelltoabandontheirprejudiceagainst
factories，whichreallyincreasethevalueoftheirproperty
insteadofdepreciatingit。\'——TR。
Chapter20
TheManufacturingPowerandtheAgriculturalInterest
Ifprotectivedutiesinfavourofhomemanufacturesproved
disadvantageoustotheconsumersofmanufacturedgoodsandserved
onlytoenrichthemanufacturer，thisdisadvantagewouldespecially
befeltbythelandedproprietorandtheagriculturist，themost
numerousandimportantclassofthoseconsumers。Butitcanbe
provedthateventhisclassderivesfargreateradvantagesfromthe
establishmentofmanufactures，thanthemanufacturersthemselves
do；forbymeansofthesemanufacturesademandforgreatervariety
andforlargerquantitiesofagriculturalproductsiscreated，the
valueinexchangeoftheseproductsisraised，theagriculturistis
placedinapositiontoutilisehislandandhispowersoflabour
moreprofitably。Henceemanatesanincreaseofrent，ofprofits，
andwages；andtheaugmentationofrentsandcapitalisfollowedby
anincreaseinthesellingvalueoflandandinthewagesof
labour。
Thesellingvalueoflandedpropertyisnothingelsethan
capitalisedrent；itisdependent，ontheonehand，ontheamount
andthevalueoftherent，but，ontheotherhand，andchiefly，on
thequantitiesofmentalandmaterialcapitalexistinginthe
nation。
Everyindividualandsocialimprovement，especiallyevery
augmentationofproductivepowerinthenation，but，mostofall，
ofthemanufacturingpower，raisestheamountofrents，whileat
thesametimeitlessenstheproportionwhichrentbearstothe
grossproduce。Inanagriculturalnationlittledevelopedand
scantilypeopled，e。g。inPoland，theproportionofrentamountsto
one-halforonethirdthegrossproduce。inawell-developed，
populous，andwealthynation，e。g。England，itonlyamountsto
one-fourthorone-fifthpartofthatproduce。Nevertheless，the
actualworthofthissmallerproportionisdisproportionately
greaterthantheworthofthatlargerproportion-inmoneyvalue
especially，andstillmoreinmanufacturedgoods。Forthefifth
partoftwenty-fivebushelstheaverageproduceofwheatin
Englandequalsfivebushels；thethirdpart，however，ofnine
bushelstheaverageproduceofwheatinPolandamountsonlyto
threebushels；further，thesefivebushelsinEnglandareworthon
anaverage25s。to30s。；whilethesethreebushelsintheinterior
ofPolandareatthemostworth8s。to9s。；andfinally，goodsin
EnglandareatleasttwiceascheapasinmanufacturedPoland：
consequentlytheEnglishlandedproprietorisabletobuyforhis
30s。ofmoney-renttenyardsofcloth，butthePolishlandownerfor
his9s。ofrentcanobtainscarcelytwoyards，fromwhichitis
evidentthattheEnglishlandedproprietorbythefifthpartofthe
grossproduceisasrentierthreetimes，andasconsumerof
manufacturedgoodsfivetimes，betteroffthanthePolishlandowner
isbythethirdpartofhisgrossproduce。Butthatfarmersand
agriculturallabourersalsomustinEnglandespeciallyas
consumersofmanufacturedgoodsbedisproportionatelybetteroff
thaninPoland，isshownbythefactthatoutoftheproduceof
twenty-fivebushelsinEnglandtwentybushelsgoforsowing，for
cultivationofthefield，wages，andprofits：halfofwhichorten
bushelsdevotedtothelasttwoitemshaveanaveragevalueof
60s。ortwentyyardsofclothat3s。peryard，whilefromthe
produceofninebushelsinPolandonlysixbushelsgoforsowing，
cultivationofthefield，profit，andwages，halfofwhich，or
threebushels，devotedtothelasttwoitems，havemerelyavalue
of10s。to12s。orthreeandahalfyardsofcloth。
Rentisachiefmeansofusefullyemployingmaterialcapital。
Itsprice。therefore，dependsalsoonthequantityofthecapital
existinginthenationandtheproportionofthesupplyofitto
thedemand。Bythesurplusofthecapitalwhichaccumulatesina
manufacturingnationastheresultofitshomeandforeign
commerce，bythelowrateofinterestwhichthereexists，andthe
circumstancethatinamanufacturingandcommercialnationanumber
ofindividualswhohavebecomewealthyarealwaysseekingtoinvest
theirsurpluscapitalinland，thesellingpriceofagivenamount
ofrentoflandisalwaysdisproportionatelyhigherinsucha
nationthaninthemereagriculturalnation。InPolandtherentof
landissoldattenortwentyyears\'purchase；inEnglandatthirty
orfortyyears\'purchase。Intheproportioninwhichtheselling
valueoftherentoflandishigherinthemanufacturingand
commercialnationthanintheagriculturalnation，soalsoisthe
sellingvalueofthelanditselfhigherintheformerthaninthe
latter。Forlandofequalnaturalfertilityineachcountry，the
valueisinEnglandtentotwentytimeshigherthaninPoland。
Thatmanufactureshaveaninfluenceontheamountofrent，and
thereforeonthevalueinexchangeoftheland，isafactwhich
AdamSmithcertainlynoticesattheconclusionoftheninthchapter
ofhisfirstbook，butonlyincidentallyandwithoutbringingthe
vastimportanceofmanufacturesinthisrespectproperlytolight。
Hetheredistinguishesthosecauseswhichinfluencedirectlythe
augmentationofrentsuchastheimprovementofthelanditself，
theincreaseinthenumberandthevalueofthecattlemaintained
uponitfromthosecauseswhichhaveonlyanindirectinfluenceon
thataugmentation，amongwhichlatterheclassesmanufactures。In
thismannerheplacesthemaincauseoftheaugmentationofthe
rentandofthevalueoflandnamely，themanufacturesinthe
backgroundsothatitisscarcelyperceptible；whileheplacesthe
improvementofthelanditselfandtheincreaseofcattle，which
arethemselvesforthemostparttheresultofmanufacturesandof
thecommerceproceedingfromthem，asthechiefcause，oratleast
asanequalcause，ofthataugmentation。
AdamSmithandhisfollowershavenotrecognisedbyanymeans
toitsfullextentthevalueofmanufacturesinthisrespect。
Wehaveremarkedthatinconsequenceofmanufacturesandofthe
commerceconnectedwiththem，thevalueoflandofequalnatural
fertilityinEnglandistentotwentytimesgreaterthaninPoland。
IfwenowcomparethetotalproduceoftheEnglishmanufacturing
productionandoftheEnglishmanufacturingcapitalwiththetotal
produceoftheEnglishagriculturalproductionandoftheEnglish
agriculturalcapital，weshallfindthatthegreatestpartofthe
wealthofthenationshowsitselfinthethusincreasedvalueof
landedproperty。
MacQueen1*haspreparedthefollowingestimateofthe
nationalwealthandnationalincomeofEngland：
I。NATIONALCAPITAL。
1。Inagriculture，lands，mines，andfisheries……
2，604mill。
Workingcapitalincattle，implements，stocks，andmoney……
655\"
Householdfurnitureandutensilsoftheagriculturists……
52\"
3，311\"
2。Investedinmanufacturesandcommerce：
Manufactures，andhometradeinmanufactured
goods……178
1/2\"
Tradeincolonialgoods……11
\"
Foreigntradeinmanufacturedgoods……16
1/2\"
206
\"
Tothisaddincreasesince1835inwhichyearthis
estimatewasmade……12
\"
218
mill。
Thenintownbuildingsofallkinds，andinmanu-
facturingbuildings605
\"
Inships……33
1/2\"
Inbridges，canals，andrailways……118
\"
Inhorseswhicharenotusedinagriculture……20
\"
776
1/2mill。
Amountofthewholenationalcapitalexclusiveof
thecapitalinvestedinthecolonies，inforeignloans，
andintheEnglishpublicfunds……4，305
1/2mill。
II。GROSSNATIONALPRODUCTION。
1。Ofagriculture，mines，andfisheries……539
mill。
2。Manufacturingproduction……259
1/2\"
798
1/2\"
Fromthisestimateitmaybeseen：
1。Thatthevalueofthelanddevotedtoagricultureamountsto
26/43ofthewholeEnglishnational，property，andisabouttwelve
timesmorethanthevalueofthewholecapitalinvestedin
manufacturesandincommerce。
2。Thatthewholecapitalinvestedinagricultureamountsto
overthree-fourthsoftheEnglishnationalcapital。
3。ThatthevalueofthewholefixedpropertyinEngland，
namely：
Oftheland，&c。2，604
mill。
Ofhousesintowns，andmanufacturingbuildings……605
\"
Ofcanalsandrailways……118
\"
3，327
\"
isthereforeequaltomorethanthree-fourthsofthewholeEnglish
nationalcapital。