will be found, I think, more curious than useful, and ought to be looked upon rather as a useless appendage than as any proper or necessary part pertaining to the science; for, although political economy be, as we have before observed, a subordinate branch of the more comprehensive science of metaphysics, it is yet separated by an easy and distinct boundary from its genealogical stem, and has properly nothing to do with the depths of metaphysics; a proof of which will perhaps appear in the further and supererogatory discussion on which we are about to enter of the present question; in which it will be seen that the moment we advance a single step beyond the point to which Dr Smith has conducted it, we are removed altogether from the precincts of this science, and that those writers who attempt to connect this question with political economy beyond the point just mentioned, either involve themselves in a labyrinth whence they can never escape, or envelope themselves in a cloud of impenetrable darkness.

SECTION II.

OF THE PUZZLE FOUNDED ON THE NATURE OF EXCHANGEABLE VALUE, AND ON THE NOTION OF ITS BEING A MERE RELATION OF COMMODITIES BETWEEN THEMSELVES.

LORD LAUDERDALE, in whose Inquiry into the Nature and Origin of Public Wealth is to be found the germ of this discussion, and indeed of almost all the peculiar doctrines of the Ricardo school, has, in the beginning of that work, treated very fully of the market-price of commodities, or their exchangeable value at a particular time and place, and of the variations to which the market-price is liable; and has explained very distinctly the causes of those variations on the principles of supply and demand; but he takes no

notice of the ulterior dependence of supply and demand, and consequently of market-price, upon cost of production. Now it is this last circumstance evidently which is the main point to be attended to, as being that alone which confers any character of science or of utility on the subject, and without keeping it in view, any reasoning about market-price must necessarily be a totally useless and unmeaning discussion about merely accidental relations of quantity or number; it being this circumstance alone, namely, the ultimate dependence of market-price on cost of production, which brings the variations of price or exchangeable value into connexion with human conduct or actions, without which the science of political economy could not exist, nor even be conceived.

But, by keeping this circumstance out of view, it has been attempted to reduce the idea of value to a mere relation of commodities between themselves, without any connexion with mankind, with labour, or with cost of production; and, in conformity with this idea of it, it has been asserted, that value or exchangeable value cannot even be expressed but by a comparison of two commodities; whereas it is manifest that it can be expressed by a comparison of commodities with labour as well; and if the term must be designated a relation, it must be acknowledged that it is a double one at least, and that the connexion of the exchangeable value of commodities with labour and cost of production is indeed the only circumstance which confers any importance on the connexion of the exchangeable value of commodities between themselves.

"Experience shows us," says Lord Lauderdale, " that every thing is uniformly considered as valuable, which, to the possession of qualities that make it the object of the desire of man, adds the circumstance of existing in scarcity. To confer value, therefore, two things appear requisite: 1. That the commodity, as being useful or delightful to man, should be

an object of his desire; 2. That it should exist in a degree of scarcity.

"With respect to the variations in value, of which every thing valuable is susceptible, if we could for a moment suppose that any substance possessed intrinsic and fixed value, so as to render an assumed quantity of it constantly, under all circumstances, of equal value, then the degree of value of all things, ascertained by such a fixed standard, would vary according to the proportion betwixt the quantity of them and the demand for them, and every commodity would, of course, be subject to a variation in its value from four different cir

cumstances:

"1. It would be subject to an increase of its value, from a diminution of its quantity.

"2. To a diminution of its value, from an augmentation of its quantity.

"3. It might suffer an augmentation in its value, from the circumstance of an increased demand.

"4. Its value might be diminished, by a failure of demand. "As it will, however, clearly appear, that no commodity can possess fixed and intrinsic value, so as to qualify it for a measure of the value of other commodities, mankind are reduced to select, as a practical measure of value, that which appears the least liable to any of these four sources of variation, which are the sole causes of alteration of value.

"When in common language, therefore, we express the value of any commodity, it may vary at one period from what it is at another, in consequence of eight different contingencies:

"1. From the four circumstances above stated, in relation to the commodity of which we mean to express the value; and,

"2. From the same four circumstances, in relation to the commodity we have adopted as a measure of value.

"As the value, therefore, of all commodities depends upon the possession of a quality that makes them the object of man's desire, and the circumstance of their existing in a certain de

gree of scarcity, it follows that the variation of all value must depend upon the alteration of the proportion betwixt the demand for and the quantity of the commodity, occasioned by the occurrence of one of the four circumstances above stated; and that a variation in the expression of value may be occasioned by the occurrence of any of the eight circumstances we have alluded to."

And his Lordship concludes his first chapter, in which the above passage occurs, in the following terms:

"Great, therefore," says he, "as the authorities are who have regarded labour as a measure of value, and who by so doing have contradicted that view of the nature of value which has been here given, it does not appear that labour forms any exception to the general rule, that nothing possesses real, fixed, or intrinsic value, or that there is any solid reason for doubting the two general principles we have endeavoured to establish ::

"1. That things are alone valuable in consequence of their uniting qualities which make them the objects of man's desire, with the circumstance of existing in a certain degree of scarcity.

"2. That the degree of value which every commodity possesses depends upon the proportion betwixt the quantity of it and the demand for it."t

Having thus tacitly endeavoured to disconnect altogether the exchangeable value of commodities from cost of production, for he takes not the slightest notice of such a connexion either here or in any other part of his book,-the noble author proceeds to advance a number of ingenious puzzles and paradoxes founded upon the nature of exchangeable value considered in this light, that is, considered abstractedly from any connexion with mankind, with labour, or with cost of production.

"It is impossible," says his Lordship, "to subscribe to the idea, that the sum total of individual riches forms an accurate statement of public wealth.* Though the opinion has been universally prevalent, it must be deemed false and unfounded by every man who considers the subject, after having formed and familiarized himself to an accurate and distinct opinion of the nature of value.

"It must then appear, that a commodity being useful or delightful to man cannot alone give it value; that to obtain value, or to be qualified to constitute a portion of private riches, it must combine with that quality the circumstance of existing in a certain degree of scarcity. Yet the common sense of mankind would revolt at a proposal for augmenting wealth by creating a scarcity of any commodity generally useful and necessary to man. For example, let us suppose a country possessing abundance of the necessaries and conveniences of life, and universally accommodated with the purest streams of water, what opinion would be entertained of the understanding of a man who, as the means of increasing the wealth of such a country, should propose to create a scarcity of water, the abundance of which was deservedly con

Lord Lauderdale endeavours to draw a distinction between what he calls "public wealth" and "individual riches.” “Wealth," says he, "may be accurately defined to consist of all that man desires, as useful or delightful to him." (Chap. ii. p. 57.) But what has political economy to do with the value of all that man desires, as useful or delightful to him?-What has it to do with the value of the air, the light and heat of the sun, or with that of dancing, music, oratory, or, in short, of any thing but labour itself, and those material objects, in the production of which some portion of labour must be employed ?" Individual riches," says his Lordship, may be defined to consist of all that man desires as useful and delightful to him, which exists in a degree of scarcity." (Chap. ii. p. 58.) A rather imperfect definition of wealth, the proper object of political economy, but framed in perfect consistency with the theory, (if theory it can be called,) which would separate the idea of exchangeable value from any connexion with labour or cost of production.