of social intercourse has, in all the most populous countries, been attained.'1

He looks on the degree of density which is required for the maximum productiveness of industry as something fixed once for all, at one hundred, or two hundred, or some other number to the square mile. This is, of course, an eminently unscientific and unhistorical way of regarding the question. The conditions under which men live, the extent of their knowledge, and their ability to profit by their knowledge, change from century to century, from year to year, and even from day to day, and almost every change affects in one way or another the density of population necessary to enable mankind to obtain in the greatest degree all the advantages both of co-operation and of social intercourse.' There is no reason whatever to suppose that the average Englishman would be better off now if the population of England had remained stationary at the point it had reached when Mill wrote his Principles of Political Economy. No doubt if it had been so restrained, and the same improvements taken place, there would,' as he alleges, have been a larger dividend than there now is '; but that the same improvements could have taken place is perfectly inconceivable.

1 1st ed. vol. ii. p. 311; People's ed. p. 454 b.

CHAPTER VI

THE IDEA OF DISTRIBUTION

§ 1. Early history of the term, and its identification with Division into Wages, Profit, and Rent.

IN tracing the history of the term 'production,' used as the title of a department of political economy, we necessarily anticipated to some extent the corresponding history of the term distribution.'1 The earliest English instance we were able to record of its use was furnished by an almost forgotten work, D. Boileau's Introduction to the Study of Political Economy, or elementary view of the manner in which the Wealth of Nations is produced, increased, distributed, and consumed, published in 1811, of which the Third Book. is entitled 'Of the Distribution of the Wealth of Nations.' But though this may have been the first English appearance of the substantive in a prominent position as an almost technical term, the use of the verb is to be traced back to the title of Adam Smith's Book I., 'Of the causes of improvement in the productive powers of labour, and of the order according to which its produce is naturally distributed among the different ranks of the people.' Before Adam Smith, English economists did not talk of distribution' or of the manner in which wealth or produce is 'distributed.' In France, however, Turgot's Réflexions sur la formation et la distribution des richesses had been printed in the Ephémérides du citoyen six years before the publication of the Wealth of Nations. 2

Looking at the ordinary non-economic use of the term,

1 Above, pp. 32-35.

2 The Réflexions were written in 1766, and first printed in the Éphémérides for November and December 1769 and January 1770. These numbers, how. ever, were not actually published till January, February, and April 1770. See G. Schelle, Pourquoi les Réflexions' de Turgot ne sont-elles pas exactement connues? in the Journal des Économistes for July 1888, pp. 3-5.

essa on the Estribution of produce relatring prestavns, irst. In what manner SIM POPKE Parkled out among those In what propertions is the vho share it, and what deter

when he used the phrase, esther a the rst of these tempt to show what causes wered by different classes or explain the various In sections in xxx he

2 home rom it in by labourers in

endeavoured to portray in his Economical Table. The Analyse du Tableau économique, which appeared in the Journal de l'agriculture in 1766, had for its second title, Analyse de la formule arithmétique du Tableau économique de la distribution des dépenses annuelles d'une nation agricole, and in it Quesnay, after describing what he calls l'ordre régulier 2 of the transactions between the three classes, says:

'On ne pourrait rien soustraire à cette distribution de dépenses au désavantage de l'agriculture, ni rien soustraire des reprises du cultivateur par quelque exaction ou par quelques entraves dans le commerce, qu'il n'arrivât du déperissement dans la reproduction annuelle des richesses de la nation et une diminution de population facile à démontrer par le calcul. Ainsi, c'est par l'ordre de la distribution des dépenses, selon qu'elles reviennent ou qu'elles sont soustraites à la classe productive, selon qu'elles augmentent ses avances, ou qu'elles les diminuent, selon qu'elles soutiennent ou qu'elles font baisser le prix des productions, qu'on peut calculer les effets de la bonne ou mauvaise conduite d'une nation.'s

An English version of Mirabeau's account of the Tableau opens with the words :

'It was first necessary to ascertain whence the income arises, in what manner it is distributed among the different classes of society, in what places it vanishes, and in what it is reproduced.' 4 It also speaks of the distributive order in which the immediate productions of the earth are consumed by the several classes.' These quotations leave little room for doubt as to the parentage of Adam Smith's phrase, 'the order according to which the produce of labour is naturally distributed among the different ranks of the people.'

A reader who was making his first acquaintance with the Wealth of Nations would naturally be led by the title of the First Book to expect to find it fall into two parts, the first dealing with the productive powers of labour, and the second

1Œuvres, ed. Oncken, p. 305.

3 Ibid., pp. 319, 320.

a Ibid., pp. 314, 319.

• The Economical Table, an attempt towards ascertaining and exhibiting the source, progress, and employment of riches, with explanations by the Friend of Mankind, the celebrated Marquis de Mirabeau; translated from the French, 1766, p. 23. 5 Ibid., p. 37.

with the manner in which its produce is distributed. His expectation would, however, be weakened when he looked through the titles of the chapters, and found that while Chapters i. to iii. deal with the division of labour, and Chapters viii. to x. with wages, profits, and rent, the intermediate chapters deal with money and prices. If there is any transition from production' to 'distribution,' he would infer, it must be a gradual one, for the chapters on money and prices cannot belong altogether either to production or distribution. On examining the matter more closely he would find that the ostensible train of thought running through the Book is as follows:-Division of labour is effected by means of exchanges, and therefore a discussion of it naturally leads to the consideration of the manner in which exchanges are facilitated by the use of money,1 and to remarks on the prices of commodities, or the rules which men naturally observe in exchanging them either for money or for one another'; 2 prices are resolvable into their component parts of wages, profit, and rent, and therefore suggest a discussion of the causes which make wages, profit, and rent high or low. The peculiarity of this is that it seems to leave no important place for the consideration of the order according to which' the produce of labour is naturally distributed among the different ranks of the people.' Adam Smith's theory of distribution, instead of being made one of the main subjects of the Book, is inserted in the middle of the chapter on prices as a mere appendage or corollary of his doctrine of prices. After explaining that the price of every commodity resolves itself into wages, profit, and rent, or into wages and profit, or into wages and rent, or into wages alone, he says:

As the price or exchangeable value of every particular commodity, taken separately, resolves itself into some one or other or all of those three parts; so that of all the commodities which compose the whole annual produce of the labour of every country, taken complexly, must resolve itself into the same three parts, and be parcelled out among different inhabitants of the country either as the wages of their labour, the profits of their stock, or the rent of their land; the whole of what is annually either collected or pro1 1 Beginning of chapter iv. 2 End of chapter iv. ; p. 13 a.

End of chapter vii