circulating capital, the true solution should have been looked for in the direction suggested by Adam Smith's chapter 'Of Money,' and by Lauderdale's 'supplanting labour' theory. Instead of either forgetting the fixed capital or assimilating it to the circulating capital, Adam Smith's successors should have shown that the function of the 'circulating capital' is the same as that which has always been ascribed to the fixed, namely, to enable an equal amount of labour to produce more necessaries, conveniences, and amusements than could be produced without it.

CHAPTER V

THE THIRD REQUISITE OF PRODUCTION-LAND

§ 1. Land in general and amount of land per capita.

'EVERYTHING useful to the life of man,' says Hume, ' arises from the ground.'1 The magniloquent Torrens observes:

'The earth supplies, spontaneously, productions calculated to supply the wants and gratify the desires of the sensitive beings which dwell upon her surface. The surrounding atmosphere, the depths of the waters, the bowels of the earth, and above all, the exterior soil, abound with materials adapted to our use. Hence the air, the waters, and the earth, and even the physical laws which determine their combinations, may be considered as the primary instruments in the formation of wealth. To avoid unnecessary circumlocution, however, the natural agents which constitute the primary instruments of production are usually included under the term land; because land is the most important of the class, and because the possession of it generally gives the command of all the others.’2

That 'land' in this extended sense is a requisite of production has always been recognised. So also has the fact that the productiveness of industry must depend partly on the original quality of the 'land,' that is to say, on the natural fertility of the soil, the accessibility of the minerals, the richness of the fisheries, and so on. About this there has never been any doubt.

But economic theory as to the way in which the productiveness of industry may be affected by the quantity of land available per capita, or, to express the same thing in other words, by the density of population, had only just begun to develop at the close of the eighteenth century.

Essay of Interest in Essays (ed. of 1770), vol. ii. p. 68. 2 Production of Wealth, p. 67.

§ 2. Eighteenth-century views of population.

General opinion in the seventeenth and eighteenth centuries seems to have regarded every increase of population with approval. In France, Vauban wrote in 1698:

'Il est constant que la grandeur des rois se mesure par le nombre de leurs sujets; c'est en quoi consiste leur bien, leur bonheur, leurs richesses, leurs forces, leur fortune, et toute la considération qu'ils ont dans le monde.' 1

In England, Joshua Gee wrote in 1729: Numbers of people have always been esteemed the riches of a state.’2

The worthy Vicar of Wakefield was ever of opinion that the honest man who married and brought up a large family did more service than he who continued single and only talked of population.'s Hume speaks of the general rule that the happiness of any society and its populousness are necessary attendants.' Adam Smith says 'the most decisive mark of the prosperity of any country is the increase of the number of its inhabitants.' As late as 1796, Pitt thought that a man had 'enriched his country' by producing a number of children, even if the whole family were paupers. He opposed Whitbread's bill for regulating the wages of labourers in husbandry, partly on the ground that it would make no difference in favour of fathers of large families, and proposed as an alternative to amend the Poor Law:

'Let us,' he said, 'make relief in cases where there are a number of children a matter of right and an honour, instead of a ground for opprobrium and contempt. This will make a large family a blessing and not a curse; and this will draw a proper line of distinction between those who are able to provide for themselves by their labour, and those who, after having enriched their country with a number of children, have a claim upon its assistance for their support.'6

1 Dime Royale (Petite Bibliothèque Économique), p. 18.

2 Trade and Navigation of Great Britain considered, Preface. Goldsmith, Vicar of Wakefield, 1776, vol. i. p. 1.

Essay of the Populousness of Ancient Nations in Essays (ed. of 1770), vol. ii. p. 179, note. 5 Bk. 1. ch. viii. p. 32 a.

6 Hansard, vol. xxxii. pp. 709, 710 (Feb. 12, 1796). Whitbread was not to be outbid; he replied: As to the particular case of labourers who have to provide for a number of children, the wisest thing for government, instead of putting the relief afforded to such on the footing of a charity, supplied

The 'powerful, affluent, and luxurious' were ready to agree with Paley that

'It may and ought to be assumed in all political deliberations that a larger portion of happiness is enjoyed amongst ten persons possessing the means of healthy subsistence, than can be produced by five persons under every advantage of power, affluence, and luxury;' and that consequently,

'the decay of population is the greatest evil a state can suffer; and the improvement of it the object which ought in all countries to be aimed at, in preference to every other political purpose whatsoever.'1

If the common herd had a healthy subsistence, that was enough. Cantillon seems to have felt that he was not quite in sympathy with his age when he remarked:

'C'est aussi une question qui n'est pas de mon sujet de savoir s'il vaut mieux avoir une grande multitude d'Habitans pauvres et mal entretenus, qu'un nombre moins considérable, mais bien plus à leur aise; un million d'Habitans qui consomment le produit de six arpens par tête, ou quatre millions qui vivent de celui d'un arpent et demi.'2

It was, of course, quite recognised that there are 'checks' to the growth of population, or that the population of a country does not commonly increase as fast as it would increase if everybody married at sixteen and lived to be seventy. It was also recognised that the actual checks' consist principally of vicious, corrupt, and violent manners, and of simple inability to procure a 'healthy subsistence.' An Italian writer, Giovanni Botero, whose treatise of the causes of the Magnificence and Greatness of Cities was translated into English in 1606, and quoted in Anderson's Origin of Commerce, says :

'Great cities are more subject to dearths than are small ones, and plagues afflict them more grievously and frequently and with a greater loss of people: so that although men were as apt to generation in the height of old Roman greatness, as in the first beginning thereof,

perhaps from a precarious fund, and dealt with a reluctant hand, would be at once to institute a liberal premium for the encouragement of large families' (p. 714).

1 Moral and Political Philosophy, 1785, Bk. vi. ch. xi., third and fourth paragraphs.

2 Essai sur le commerce, p. 113.

yet for all that, the people increased not proportionably, because the virtue nutritive of that city had no power to go further; and in succession of time, the inhabitants finding much want, and less means to supply the same, either forebore to marry, or else fled their country; and for the same reasons, mankind, grown to a certain complete number, hath grown no further. And it is three thousand years or more, that the earth was as full of people as at present; for the fruits of the earth, and the plenty of victuals do not suffice to feed a greater number. Man first propagated in the east, and thence spread far and near; and having peopled the continent, they next peopled the islands; thence they passed into Europe, and last of all to the new world. The barrenness of soils, scarcity of necessaries, inundations, earthquakes, pestilences, famines, wars, etc., have occasioned numberless migrations, and even the very driving out by force of the younger people, and in many countries the selling of them for slaves, in order to make room for such as remained; all which are the let and stay that the number of men cannot increase and grow immoderately.'1

Robert Wallace, one of those who contended, in opposition to Hume, that the world was more populous in ancient than in modern times, inserted in his Dissertation on the Numbers of Mankind (1753), a table which shows by numerical examples how enormously rapid the growth of population would be, if it depended merely on the fecundity of mankind.2

'It is not,' he declared, 'owing to the want of prolific virtue, but to the distressed circumstances of mankind, that every generation does not more than double themselves.' 3

"Through various causes there has never been such a number of inhabitants on the earth at any one point of time as might have been easily raised by the prolific virtue of mankind. The causes of this paucity of inhabitants and irregularity of increase are manifold. Some of them may be called physical, as they depend entirely on the course of nature, and are independent of mankind. Others of them are moral, and depend on the affections, passions, and institutions of men. . . . To this last article we may refer so many destructive wars which men have waged against one another; great poverty, corrupt institutions, either of a civil or religious kind, intemperance, debauchery, irregular amours, idleness, luxury, and whatever either prevents marriage, weakens the generating faculties of men, or renders 1 Origin of Commerce, 1787, vol. ii. p. 178.

3 P. 8, note.

2 P. 4.