naturel, alors les mouvemens de la circulation seront dirigés par une force aveugle et inconnue; les prix moyens ne seront plus que le résultat de chances purement fortuites; il n'y aura plus d'équivalent réel; les valeurs n'auront plus de mesure naturelle; l'économie politique ne pourra plus aspirer à être au rang des sciences, puisqu'elle manquera du caractère essentiel qui les constitue telles, et que les faits dont elle traite ne seront plus fondés sur les lois immuables de la nature.” *

Having thus shown that the cost of production is the sole regulating principle of exchangeable value and price, I shall now proceed to investigate the elements which enter into and constitute this cost. †

SECTION IV.

Commodities belong, in the earliest stage of society, exclusively to the Labourers-Quantity of Labour required for their Production, the only principle which then determines their Exchangeable Value.

We have previously seen, that there is no period in the progress of society, from its earliest infancy to its

* Tome I. Introduction, p. 62.

+ Mr Tooke has, in his excellent work On High and Low Prices, a work replete with curious and important information, given a very complete analysis and exposition of the influence of variations in the demand for and supply of commodities on their price-whether these variations arise from changes ia the seasons or in the value of money, from a spirit of speculation, from the caprices of fashion, the influence of war, &c.

highest pitch of civilization and refinement, in which any individual, who does not belong to some one or other of the classes of labourers, landlords, or capitalists, ever participates directly in the produce of industry. But there are states of society in which that produce belongs exclusively to one only of these classes; and others in which it belongs to two of them, to the exclusion of the third. The reason is, that in the earliest stages of society, there is little or no capital accumulated, and the distinction between labourers and capitalists is, in consequence, unknown; and that, in all newly settled and unappropriated countries, abundance of fertile land may be obtained without paying any rent to a landlord.

In that remote period preceding the establishment of a right of property in land, and the accumulation of capital or stock-when men roamed, without any settled habitations, over the surface of the earth, and existed by means of that labour only that was required to appropriate the spontaneous productions of the soil, the whole produce of labour belonged to the labourer, and the quantity of labour expended in procuring different articles, must plainly have formed the only standard by which their relative worth, or exchangeable value, could be estimated. "If among a nation of hunters," says Dr Smith," it usually "it costs twice the labour to kill a beaver that it does to kill a deer, one beaver would naturally exchange for or be worth two deer. It is natural, that what is usually the produce of two days' or two hours' labour,

should be worth double of what is usually the produce of one day's or one hour's labour.

"If the one species of labour should be more severe than the other, some allowance will naturally be made for this superior hardship; and the produce of one hour's labour in the one way, frequently exchanges for that of two hours' labour in the other.

"Or if the one species of labour requires an uncommon degree of dexterity and ingenuity, the esteem which men have for such talents will naturally give a value to their produce, superior to what would be due to the time employed about it. Such talents can seldom be acquired but in consequence of long application, and the superior value of their pro. duce may frequently be no more than a reasonable compensation for the time and labour which must be spent in acquiring them. In the advanced state of society, allowances of this kind, for superior hardship and superior skill, are commonly made in the wages of labour; and something of the same kind must probably have taken place in the earliest and rudest period.

"In this state of things, the whole produce of labour belongs to the labourer; and the quantity of labour commonly employed in acquiring or producing any commodity, is the only circumstance which can regulate the quantity of labour (of other commodities) which it commonly ought to purchase, command, or exchange for." *

Thus far there is no room for doubt or difference of opinion. When there is no class but labourers, all the produce of labour must obviously belong to them; and the sacrifice each individual makes in producing commodities, or the quantity of labour that he expends upon them, is universally admitted to be the only principle by which their exchangeable values can then be determined.

It is at this point, therefore, that we properly commence the investigation of the circumstances which determine the exchangeable value of commodities when a rent is paid for land, and circulating and fixed capital employed to facilitate the labour of the workmen. I shall begin by endeavouring to

ascertain whether rent enters into the cost of production.

SECTION V.

(I.) Nature, Origin, and Progress of Corn or Produce Rents— Rent not a Cause but a Consequence of the High Value of Ran Produce-Does not enter into Price-Distinction between Agriculture and Manufactures. (II.) Money Rents depend partly on the Extent to which Tillage has been Carried, and partly on Situation-The Principle that the Real Value of Commodities is Regulated or Determined by the Quantities of Labour required for their Production, not Affected by the Payment of Rent.

DR SMITH was of opinion, that, after land had become property, and rent began to be paid, such rent made an equivalent addition to the exchange

This opi

able value of the produce of the soil.* nion was first called in question in two pamphlets of extraordinary merit, published nearly at the same time, by a Fellow of University College, Oxford, † and Mr Malthus. These writers endeavoured to show that rent did not enter into price; that it was not, as had been commonly supposed, a consequence of land having been divided and become property; but that it was owing to its being of limited extent, and of various degrees of fertility, and to the circumstance of its being impossible to apply capital indefinitely to any quality of land without obtaining from it a constantly diminishing return. Mr Ricardo subsequently illustrated and enforced this doctrine with his usual ability-stripped it of the errors by which it had been originally encumbered, and showed its vast importance to a right understanding of the laws which regulate the rise and fall of profits. In the following observations, I shall endeavour to trace the rise and progress of rent; and to obviate some rather specious objections that have been made to the doctrine of its not entering into price.

I. CORN OR PRODUCE RENTS.—Rent is properly "that portion of the produce of the earth which is

* Wealth of Nations, I. p. 75.

+ An Essay on the Application of Capital to Land, by a Fellow (Mr West a Barrister) of University College, Oxford,

1815.

An Inquiry into the Nature and Progress of Rent, by the Rev. T. R. Malthus, 1815.