labour, and augment in very different proportions the value of the annual produce of the land and labour of the society to which they belong, according as they are employed either in procuring the rude produce annually required for the use and consumption of the society; in manufacturing and preparing that rude produce for immediate use and consumption; in transporting either the rude or manufactured produce from the places where they abound to those where they are wanted; or, lastly, in dividing particular portions of either into such small parcels as suit the occasional demands of those who want them."

Accordingly, he teaches that "no equal capital puts into motion a greater quantity of productive labour than that of the farmer, because nature performs seldom less than a fourth, and frequently more than a third, of the labour; and no equal quantity of productive labour employed in manufactures can ever occasion so great a production."

Next to the capital of the farmer, Adam Smith ranks that of the manufacturer, "who augments the value of the raw materials he employs by the wages of his different workmen, and by his own profits upon the whole stock of wages, materials, and instruments of trade employed in the business."

To the capital of the wholesale-merchant he assigns the last rank, because" it augments the price of his goods merely by the value of his profits, and the wages of the sailors and carriers who transport his goods from one place to another."

The difference too he states to be very great,

according to the different sorts of wholesale-trade in which any part of the capital is employed, which he reduces to three.

"The capital employed in the home-trade is the most lucrative, because its returns come in three or four times in the year, which multiply three or four times the sum of national labour.

"The capital employed in the foreign trade of consumption, is less productive than that employed in the home-trade, because its profits are shared between the native merchant and the foreign one.

"Lastly, the capital employed in the carrying trade is the least productive of all, because it is altogether withdrawn from supporting the productive labour of the country to support that of some foreign countries."*

This theory, it must be acknowledged, is ingenious and captivating; it does honour to the sagacity of its author: but is it not in reality more brilliant than solid? Is it not a merely ideal and perfectly fanciful abstraction? And would it not frequently be fatal and almost always dangerous, to put it into practice?

To obtain correct notions in this respect, we must descend from the speculative and often fascinating heights of theory, and convince ourselves of its truth or fallacy by an attentive examination of the different cases to which it may apply. We must know whether it is in all situations, or only in some particular situations, that the employment of capital in agriculture is the most proper to enrich a nation, or whether any

* Adam Smith's Wealth of Nations, book ii. chap. 5.

other employment is more or less favourable to wealth. In short, we must follow capitals in their progress, ascertain their effects, and determine in some degree their absolute and relative power. This examination will either unveil the error, or confirm the accuracy, of the fascinating doctrine of Adam Smith.

If a nation possessed of a territory of large extent, great fertility, and fit to be cultivated, had large capitals, and employed them chiefly in agriculture; that nation would undoubtedly obtain a very considerable agricultural produce: but this produce, whatever might be its magnitude, would not of itself constitute any real and effective wealth; it would be wealth only when it had the power of obtaining in exchange all the other objects which the cultivators of the soil might be in want of, or which might suit their convenience. That part of produce which they could neither consume nor exchange, would be without any value, and as if it did not exist. A country possessed of none but such wealth, would be completely wretched. If agricultural produce is to constitute wealth, it is absolutely necessary that it may easily be exchanged against equivalents.

But where are we to look for, where to find these equivalents, which alone can give it a value, and raise it to the rank of wealth?

Is it in the interior of the country, where the agricultural produce has been gathered? The attempt will prove abortive, if manufactures and commerce have not made a progress similar to that of agriculture; if the manufacturing and trading classes are inconsiderable in number, and not sufficiently rich to give

equivalents in exchange for the agricultural produce offered to them.

"The extent of the home-market, for corn," says Adam Smith, "must be in proportion to the general industry of the country where it grows."*

If this maxim be correct; how can the employment of capital in agriculture be the most profitable, the best calculated to enrich the society to which it belongs? How can the manufacturing and trading classes, when deprived of the capitals reserved for agriculture, rise and prosper so as to give any value to the produce of the agricultural class? And without this value, what will become of the agricultural produce?

The nations of ancient and feudal times employed their capitals exclusively in agriculture, and yet they never arrived at wealth; or at least their wealth was confined to the hands of a few individuals, and did not circulate in the nation. The agricultural produce, however abundant for each land-owner, created neither commerce nor manufactures. Every rich and powerful individual had in his house slaves whose labour supplied his wants; and having nothing to ask of his fellow-citizens, he had nothing to offer them. Whenever his wealth became excessive, he imagined no other way of using or employing it than to erect public monuments, and to entertain the people with sumptuous feasts, or to surround himself with a numerous train of courtiers, flatterers, and valets; so that it

* Adam Smith; Wealth of Nations; London, 1805, vol. ii. book iv. chap. 5, page 321.

was consumed without any re-production, and without any advantage to national wealth and population. Such was the effect of the employment of capital in agriculture.

Prejudicial as it was to the nations of antiquity and of the middle age, it would yet prove much more fatal to modern nations. It then produced at least private wealth, because agriculture was entrusted to slaves and bond-men, whom fear condemned to labour: but at present it would not even produce private wealth. Not finding any vent for the surplus of their produce, the agricultural classes would only labour up to their wants, and all means of attaining wealth and prosperity would vanish for ever.*

Will it be said, that the agricultural country may sell her produce abroad?

But if other countries also employed their capitals in agriculture, if they too neglected manufactures and commerce, her hopes would be disappointed and her

In our modern states, lands are unequally distributed. They yield more produce than those by whom they are cultivated can consume; and if arts be neglected, and agriculture alone practised, the country cannot be peopled. Those who till, or cause the ground to be tilled, having a surplus of produce, nothing stimulates them to labour the following year; neither is the produce consumed by the idle, because the idle have not wherewith to purchase it. Arts must therefore be introduced, that the produce may be consumed by artists and workmen. In short, it is necessary, in modern states, that many should raise agricultural produce beyond what they want. For this purpose, a wish must be excited in them to possess superfluities; and these are afforded only by artisans. Montesquieu, Esprit des Loix, Liv. lxiii. chap. 16.