BOOK ones particularly, the efficacy of human industry 1. feems not to be limited, but to be altogether un

certain.

THE quantity of the precious metals which is to be found in any country is not limited by any thing in its local fituation, fuch as the fertility or barrenness of its own mines. Those metals frequently abound in countries which poffefs no mines. Their quantity in every particular country feems to depend upon two different circumftances; first, upon its power of purchafing, upon the ftate of its industry, upon the annual produce of its land and labour, in confequence of which it can afford to employ a greater or a fmaller quantity of labour and subsistence in bringing or purchafing fuch fuperfluities as gold and filver, either from its own mines or from those of other countries; and, fecondly, upon the fertility or barrennefs of the mines which may happen at any particular time to fupply the commercial world with thofe metals. The quantity of those metals in the countries most remote from the mines, must be more or lefs affected by this fertility or barrennefs, on account of the eafy and cheap transportation of thofe metals, of their, fmall bulk and great value. Their quantity in China and Indoftan must have been more or less affected by the abundance of the mines of America.

So far as their quantity in any particular country depends upon the former of thofe two circumstances (the power of purchasing), their real price, like that of all other luxuries and fuperAuities, is likely to rife with the wealth and improvement

XI.

provement of the country, and to fall with its CHA P. poverty and depreffion. Countries which have a great quantity of labour and fubfiftence to fpare, can afford to purchase any particular quantity of those metals at the expence of a greater quantity of labour, and subsistence, than countries which have less to spare.

So far as their quantity in any particular country depends upon the latter of thofe two circumstances (the fertility or barrenness of the mines which happen to fupply the commercial world) their real price, the real quantity of labour and fubfiftence which they will purchase or exchange for, will, no doubt, fink more or lefs in proportion to the fertility, and rife in proportion to the barrenness, of those mines.

THE fertility or barrennefs of the mines, however, which may happen at any particular time to fupply the commercial world, is a circumftance which, it is evident, may have no fort of connection with the ftate of industry in a particular country. It seems even to have no very neceffary connection with that of the world in general. As arts and commerce, indeed, gradually fpread themfelves over a greater and a greater part of the earth, the fearch for new mines, being extended over a wider furface, may have fomewhat a better chance for being fuccefsful, than when confined within narrower bounds. The discovery of new mines, however, as the old ones come to be gradually exhausted, is a matter of the greatest uncertainty, and fuch as no human skill or industry can enfure. All indi

Bb 3

BOOK indications, it is acknowledged, are doubtful, 1. and the actual discovery and fuccefsful working

How true This has proved!

of a new mine can alone afcertain the reality of
its value, or even of its existence. In this fearch
there feem to be no certain limits either to the
poffible fuccefs, or to the poffible difappoint-
ment of human induftry. In the courfe of a
century or two, it is poffible that new mines may
be discovered more fertile than any that have
ever yet been known; and it is juft equally pof-
fible that the most fertile mine then known may
be more barren than any that was wrought
before the discovery of the mines of America.
Whether the one or the other of thofe two events
may happen to take place, is of very little im-
portance to the real wealth and profperity of the
world, to the real value of the annual produce
of the land and labour of mankind.
Its no-
minal value, the quantity of gold and filver by
which this annual produce could be expreffed or
reprefented, would, no doubt, be very different;
but its real value, the real quantity of labour
which it could purchase or command, would be
precifely the fame. A fhilling might in the one
cafe reprefent no more labour than a penny does
at present; and a penny in the other might re-
prefent as much as a fhilling does now. But in
the one cafe he who had a fhilling in his pocket,
would be no richer than he who has a penny at
prefent; and in the other he who had a penny
would be just as rich as he who has a fhilling
now. The cheapnefs and abundance of gold
and filver plate, would be the fole advantage

XI.

which the world could derive from the one event, CHA P.
and the dearness and scarcity of thofe trifling fuper-
fluities the only inconveniency it could fuffer from
the other.

Conclufion of the Digreffion concerning the Variations in the Value of Silver.

Mercanti
System.

THE greater part of the writers who have collected the money prices of things in ancient times, feem to have confidered the low money price of corn, and of goods in general, or, in other words, the high value of gold and filver, as a proof, not only of the fcarcity of thofe metals, but of the poverty and barbarifm of the country at the time when it took place. This notion is connected with the fyftem of political economy which represents national wealth as confifting in the abundance, and national poverty in the fcarcity, of gold and filver; a fyftem which I fhall endeavour to explain and examine at great length in the fourth book of this enquiry. I fhall only obferve at prefent, that the high value of the precious metals can be no proof of the poverty or barbarism of any particular country at the time when it took place. It is a proof only of the barrenness of the mines which happened at that time to fupply the commercial world. A poor country, as it cannot afford to buy more, fo it can as little afford to pay dearer for gold and filver than a rich one; and the value of those metals, therefore, is not likely to be higher in the former than in the latter. In China, a coun

I.

BOOK try much richer than any part of Europe, the value of the precious metals is much higher than in any part of Europe. As the wealth of Europe, indeed, has increased greatly fince the discovery of the mines of America, fo the value of gold and filver has gradually diminished. This diminution of their value, however, has not been owing to the increase of the real wealth of Europe, of the annual produce of its land and labour, but to the accidental difcovery of more abundant mines than any that were known before. The increase of the quantity of gold and filver in Europe, and the increase of its manufactures and agriculture, are two events which, though they have happened nearly about the fame time, yet have arifen from very different causes, and have scarce any natural connection with one another. The one has arifen from a mere accident, in which neither prudence nor policy either had or could have any share: The other from the fall of the feudal fyftem, and from the establishment of a government which afforded to industry the only encouragement which it requires, fome tolerable fecurity that it fhall enjoy the fruits of its own labour. Poland, where the feudal fyftem ftill continues to take place, is at this day as beggarly a country as it was before the difcovery of America. The money price of corn, however, has rifen; the real value of the precious metals has fallen in Poland, in the fame manner as in other parts of Europe. Their quantity, therefore, must have increased there as in other places, and nearly in

the