knowledge required for the construction of a sound. theory of Political Economy, will cease to feel any surprise at the errors into which its cultivators have been betrayed, or at the discrepancy of the opinions that are still entertained on a few important points. Political Economy is of very recent origin. Though various treatises of considerable merit had previously been published on some of its detached parts, it was not treated as a whole, or in a scientific manner, until about the middle of last century. This circumstance is of itself enough to account for the number of erroneous systems that have since appeared. Instead of deducing their general conclusions from a comparison of particular facts, and a careful examination of the phenomena attending the operation of different principles, and of the same principles under different circumstances, the first cultivators of almost every branch of science begin by framing their theories on a very narrow and insecure basis. Nor is it really in their power to go to work differently. Observations are scarcely ever made, or particulars noted, for their own sakes. It is not until they begin to be sought after, as furnishing the only test by which to ascertain the truth or falsehood of some popular theory, that they are made in sufficient numbers, and with sufficient accuracy. It is, in the peculiar phraseology of this science, the effectual demand of the theorist that occasions the production of the facts or raw materials he is afterwards to work into a system. The history of the science strikingly exemplifies the truth of this remark. Being, as already

observed, entirely unknown to the ancients, and but little attended to by our ancestors down to a comparatively late period, most of those circumstances which would have enabled us to judge of the wealth and civilization of the most celebrated states of antiquity, and of Europe during the middle ages, have either been thought unworthy of notice by the historian, or have been very imperfectly and carelessly detailed. Those, therefore, who first began to trace its general principles, had but a comparatively limited and scanty experience on which to build their conclusions. Nor did they even avail themselves of the few historical facts with which they might easily have become acquainted; but, for the most part, confined their attention to such as happened to come within the narrow sphere of their own observation.

The circumstance of the money of all civilized countries having principally consisted of gold and silver, naturally gave birth to the once prevalent opinion that wealth consisted exclusively of the precious metals. Having been used both as standards by which to measure the value of different commodities, and as the equivalents for which they were most frequently exchanged, they acquired an artificial importance, not merely in the estimation of the vulgar, but in that also of persons of the greatest discernment. The simple and decisive consideration, that to buy and to sell is merely to barter one commodity for another-to exchange a certain quantity of corn or cloth, for example, for a certain quantity of gold or silver, and vice versá—was entirely overlooked. The attention

was gradually transferred from the money's worth to the money itself; and the wealth of individuals. and of states came to be measured by the quantity of the precious metals actually in their possession ; and not, as it should have been, by the abundance of their disposable products, or by the quantity and value of the commodities with which they could afford to purchase these metals. And hence the policy, as obvious as it was universal, of attempting to increase the amount of national wealth by forbidding the exportation of gold and silver, and encouraging their importation.

It appears from a passage of Cicero, that the exportation of the precious metals from Rome had been frequently prohibited during the Republic;1 and this prohibition was repeatedly renewed, though to very little purpose, by the Emperors. Neither, perhaps, has there been a state in modern Europe which has not expressly forbidden the exportation of gold and silver. It is said to have been interdicted by the law of England previously to the Conquest; and various statutes were subsequently passed to the same effect; one of which, (3d Henry VIII. cap. 1,) enacted

1 "Exportari aurum non oportere, cum sæpe antea senatus, tum me consule, gravissime judicavit." - Orat. pro L. Flacco, cap. 28.

2 Pliny, when enumerating the silks, spices, and other Eastern products imported into Italy, says, "Minimáque computatione millies centena millia sestertium annis omnibus, India et Seres, peninsulaque illa (Arabia) imperio nostro adimunt. Tanto nobis delicio et fæminæ constant." Hist. Nat. lib. xii. cap. 18.

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so late as 1512, declared, that all persons carrying over sea any coins, plate, jewels, &c. should, on detection, forfeit double their value.

The extraordinary extension of commerce during the fifteenth and sixteenth centuries occasioned the substitution of a more refined and complex system. for increasing the supply of the precious metals, in the place of the coarse and vulgar one that had previously obtained. The establishment of a direct intercourse with India by the Cape of Good Hope, seems to have had the greatest influence in effecting this change. The precious metals have usually been among the most advantageous articles of export to the East and, notwithstanding the old and deeplyrooted prejudices against their exportation, the East India Company obtained, when first instituted, in 1600, leave annually to export foreign coins, or bullion, of the value of £30,000; on condition, however, of their importing, within six months after the termination of every voyage, except the first, as much gold and silver as they exported. But the enemies of the Company contended, that this condition was not complied with; and that it was besides contrary to all principle, and highly injurious to the public interests, to permit gold and silver to be sent out of the kingdom. The merchants, and others interested in the support of the Company could not controvert the reasonings of their opponents, without openly impugning the ancient policy of absolutely preventing the exportation of the precious metals. They did not, indeed, venture to contend, and it probably did

not occur to them, that the exportation of bullion to India was advantageous, because the commodities bought by it were of greater value in England; but they contended, that its exportation was advantageous, because the commodities brought from India were chiefly re-exported to other countries, from which a greater amount of bullion was obtained in payment for them than had been originally required for their purchase in the East. Mr. Thomas Mun, the ablest of the Company's advocates, ingeniously compares the operations of the merchant in conducting a trade carried on by the exportation of gold and silver, to the seed-time and harvest of agriculture. "If we only behold," says he, "the actions of the husbandman in the seed-time, when he casteth away much good corn into the ground, we shall account him rather a madman than a husbandman. But when we consider his labours in the harvest, which is the end of his endeavours, we shall find the worth and plentiful increase of his actions." 1

Such was the origin of what has been called the MERCANTILE SYSTEM: and, when compared with the previous prejudice, for it hardly deserves the name of system, which wholly interdicted the exportation

"Treasure by Foreign Trade," orig. ed. p. 50.-This work was published in 1664, a considerable period after Mr. Mun's death. Most probably it had been written about 1635 or 1640. Mun had previously advanced the same doctrines, nearly in the same words, in his Defence of the East India Trade, originally published in 1621, and in a petition drawn up by him, and presented by the East India Company to Parliament, in 1628.