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BOO K ing them to market, according to the lowest rate
at which labour can any-where be paid, the bare
The proportion which the usual market rate of interest ought to bear to the ordinary rate of clear profit, neceffarily varies as profit rises or falls. Double interest is in Great Britain reckoned, what the merchants call, a good, moderate, reasonable profit ; terms which I apprehend mean no more than a common and usual profit. In a country where the ordinary rate of clear profit is eight or ten per cent. it may be reasonable that one half of it should go to interest, wherever business is carried on with borrowed money. The stock is at the risk of the borrower, who, as it were, insures it to the lender ; and four or five per cent. may, in the greater part of trades, be both a fufficient profit upon the risk of this insurance, and a fufficient recompence for the trouble of employing the stock. But the proportion between interest and clear profit might not be the fame in countries where the ordinary rate of profit was either a good deal lower, or a good deal higher. If it were a good deal lower, one half of it perhaps could not be afforded for intereft ; and
more might be afforded if it were a good deal c H AP. higher.
In countries which are fast advancing to riches, the low rate of profit may, in the price of many commodities, compensate the high wages of labour, and enable those countries to sell as cheap as their less thriving neighbours, among whom the wages of labour may be lower.
In reality high profits tend much more to raise the price of work than high wages. If in the linen manufacture, for example, the wages of the different working people, the flax-dressers, the fpinners, the weavers, &c. should, all of them, be advanced two pence a day; it would be necessary to heighten the price of a piece of linen only by a number of two pences equal to the number of people that had been employed about it, multiplied by the number of days during which they had been so employed. That part of the price of the commodity which resolved itself into wages would, through all the different ftages of the manufacture, rise only in arithmetical proportion to this rise of wages. But if the profits of all the different employers of those working people should be raised five per cent. that part of the price of the commodity which resolved itself into profit, would, through all the different stages of the manufacture, rise in geometrical proportion to this rise of profit. The employer of the flax-dressers would in selling his flax require an additional five per cent. upon the whole value of the materials and wages which he advanced to his workmen. The employer of L 3
BOO K the spinners would require an additional five per
cent. both upon the advanced price of the flax and
wages of the spinners. And the employer of the weavers would require a like five per cent. both upon the advanced price of the linen yarn
of the weavers. In raising the price of commodities the rise of wages operates in the same manner as fimple interest does in the accumulation of debt. The rise of profit operates like compound intereft. Our merchants and master-manufacturers com. plain much of the bad effects of high wages in raising the price, and thereby lessening the fale of their goods both at home and abroad. They say nothing concerning the bad effects of high profits. They are filent with regard to the pernicious effects of their own gains. They complain only of those of other people.
of Labour and Stock. THE whole of the advantages and disad. CHA P.
vantages of the different employments of labour and stock muft, in the fame neighbourhood, be either perfectly equal or continually tending to equality. If in the fame neighbourhood, there was any employment evidently either more or less advantageous than the rest, so many people would crowd into it in the one cafe, and so many would defert it in the other, that its advantages would foon return to the level of other employments. This at least would be the case in a fociety where things were left to follow their natural course, where there was perfect liberty, and where every man was pérfectly free both to chuse what occupation hệ thought proper, and to change it as often ashe thought proper. Every man's interest would prompt him to seek the advantageous, and to Thun the disadvantageous employment.
Pecuniary wages and profit, indeed, are everywhere in Europe extremely different according to the different employments of labour and ftock. But this difference arises partly from certain circumstances in the employments themselves, which, either really, or at least in the imaginations of men, make up for a small pecu, L4
BOO K niary gain in fome, and counter-balance a great
one in others; and partly from the policy of Europe, which no-where leaves things at perfect liberty.
The particular consideration of those circum. stances and of that policy will divide this chapter into two parts.
stances which, so far as I have been able to observe, make up for a small pecuniary gain in fome employments, and counter-balance a great one in others: first, the agreeableness or difagreeableness of the employments themselves ; secondly, the easiness and cheapness, or the dif. ficulty and expençe of learning them; thirdly, the constancy or inconstancy of employment in thèm ; fourthly, the small or great trust which must be reposed in those who exercise them; and fifthly, the probability or improbability of success in them,
First, The wages of labour vary with the ease or hardship, the cleanliness or dirtiness, the honourableness or dishonourableness of the employment. Thus in most places, take the year round, a journeyman taylor earns less than a journeyman weaver. His work is much easier. A journeyman weaver earns less than a journey. man smith. His work is not always easier, but