III. which grow upon the banks of the Garonne, and C HA P. of the rivers which run into it, one of the richest wine countries in the world, and which seems to produce the wine fitteft for exportation, or best fuited to the taste of foreign nations. Such advantageous fituations neceffarily attract a great capital by the great employment which they afford it; and the employment of this capital is the caufe of the industry of thofe two cities. In the other parliament towns of France, very little more capital feems to be employed that what is neceffary for fupplying their own confumption; that is, little more than the smallest capital which can be employed in them. The fame thing may be faid of Paris, Madrid, and Vienna. Of those three cities, Paris is by far the most induftrious: but Paris itself is the principal market of all the manufactures established at Paris, and its own consumption is the principal object of all the trade which it carries on. London, Lisbon, and Copenhagen, are, perhaps, the only three cities in Europe, which are both the conftant refidence of a court, and can at the fame time be confidered as trading cities, or as cities which trade not only for their own confumption, but for that of other cities and countries. The fituation of all the three is extremely advantageous, and naturally fits them to be the entrepôts of a great part of the goods deftined for the confumption of diftant places. In a city where a great revenue is fpent, to employ with advantage a capital for any other purpose than for fupplying the consumption of that city, is probably ·II. BOOK probably more difficult than in one in which the inferior ranks of people have no other maintenance but what they derive from the employment of fuch a capital. The idleness of the greater part of the people who are maintained by the expence of revenue, corrupts, it is probable, the industry of those who ought to be maintained by the employment of capital, and renders it lefs advantageous to employ a capital there than in other places. There was little trade or industry in Edinburgh before the Union. When the Scotch parliament was no longer to be affembled in it, when it ceafed to be the neceffary refidence of the principal nobility and gentry of Scotland, it became a city of fome trade and industry. It ftill continues, however, to be the refidence of the principal courts of juftice in Scotland, of the boards of cuftoms and excife, &c. A confiderable revenue, therefore, ftill continues to be spent in it. In trade and industry it is much inferior to Glasgow, of which the inhabitants are chiefly maintained by the employment of capital. The inhabitants of a large village, it has fometimes been obferved, after having made confiderable progrefs in manufactures, have become idle and poor, in confequence of a great lord's having taken up his refidence in their neighbourhood, The proportion between capital and revenue, therefore, feems every-where to regulate the proportion between industry and idlenefs. Whereever capital predominates, induftry prevails: wherever revenue, idlenefs. Every increase or diminution III. diminution of capital, therefore, naturally tends CHA P. to increase or diminish the real quantity of industry, the number of productive hands, and confequently the exchangeable value of the annual produce of the land and labour of the country, the real wealth and revenue of all its inhabitants. Capitals are increased by parfimony, and diminished by prodigality and misconduct. Whatever a perfon faves from his revenue he adds to his capital, and either employs it himself in maintaining an additional number of productive hands, or enables fome other person to do fo, by lending it to him for an interest, that is, for a share of the profits. As the capital of an individual can be increased only by what he faves from his annual revenue or his annual gains, fo the capital of a fociety, which is the fame with that of all the individuals who compofe it, can be increafed only in the fame manner. Parfimony, and not induftry, is the immediate caufe of the increase of capital. Industry, indeed, provides the fubject which parfimony accumulates. But whatever induftry might acquire, if parfimony did not fave and store up, the capital would never be the greater. Parfimony, by increafing the fund which is deftined for the maintenance of productive hands, tends to increase the number of thofe hands whofe labour adds to the value of the fubject upon which it is bestowed. It tends therefore to increase the exchangeable value of the annual pro duce BOOK duce of the land and labour of the country. It II. puts into motion an additional quantity of induftry, which gives an additional value to the annual produce. What is annually faved is as regularly confumed as what is annually spent, and nearly in the fame time too; but it is confumed by a different fet of people. That portion of his revenue which a rich man annually spends, is in moft cafes confumed by idle guests, and menial fervants, who leave nothing behind them in return for their confumption. That portion which he annually faves, as for the fake of the profit it is immediately employed as a capital, is confumed in the fame manner, and nearly in the fame time too, but by a different set of people, by labourers, manufacturers, and artificers, who re-produce with a profit the value of their annual confumption. His revenue, we fhall fuppofe, is paid him in money. Had he spent the whole, the food, clothing, and lodging, which the whole could have purchased, would have been distributed among the former fet of people. By faving a part of it, as that part is for the fake of the profit immediately employed as a capital either by himself or by fome other person, the food, clothing, and lodging, which may be purchased with it, are neceffarily referved for the latter. The confumption is the fame, but the confumers are different. By what a frugal man annually faves, he not only affords maintenance to an additional number of productive hands, for that or the enfuing year, С III. year, but, like the founder of a public work- c H A P. houfe, he establishes as it were a perpetual fund for the maintenance of an equal number in all times to come. The perpetual allotment and destination of this fund, indeed, is not always guarded by any pofitive law, by any truft-right or deed of mortmain. It is always guarded, however, by a very powerful principle, the plain and evident interest of every individual to whom any fhare of it fhall ever belong. No part of it can ever afterwards be employed to maintain any but productive hands, without an evident lofs to the perfon who thus perverts it from its proper deftination. The prodigal perverts it in this manner. By not confining his expence within his income, he encroaches upon his capital. Like him who perverts the revenues of fome pious foundation to profane purposes, he pays the wages of idlenefs with thofe funds which the frugality of his forefathers had, as it were, confecrated to the maintenance of industry. By diminishing the funds deftined for the employment of productive labour, he neceffarily diminishes, fo far as it depends upon him, the quantity of that labour which adds a value to the fubject upon which it ís bestowed, and confequently, the value of the annual produce of the land and labour of the whole country, the real wealth and revenue of its inhabitants. If the prodigality of fome was not compensated by the frugality of others, the conduct of every prodigal, by feeding the idle with the bread of the induftrious, tends. not only |