--- ENTITY: agricultural systems of political economy ---

# Agricultural Systems of Political Economy

## Definition

A school of economic thought that represents the produce of land as either the sole or principal source of the revenue and wealth of every country, contrasting with mercantile systems that emphasize manufacturing and trade.

## Source Chapter

Book IV, Chapter 9

## Context

This chapter introduces and critiques the agricultural systems of political economy, which were primarily developed by French philosophers as a response to Colbert's mercantile policies. Smith examines how these systems emerged as a reaction to the overvaluation of urban industry and the undervaluation of agricultural production in Colbert's approach.

## Economic Domain

General Theory

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--- ENTITY: productive class ---

# Productive Class

## Definition

The class of cultivators, farmers, and country labourers who are distinguished by their ability to reproduce annually a neat produce that remains after paying all necessary expenses, thereby increasing the real revenue and wealth of society through their productive labour.

## Source Chapter

Book IV, Chapter 9

## Context

Smith explains how agricultural systems classify society into three classes, with cultivators being designated as the "productive class" because their labour not only replaces its own value but generates a surplus that increases national wealth, unlike the barren or unproductive class of artificers and manufacturers.

## Economic Domain

Production

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--- ENTITY: barren or unproductive class ---

# Barren or Unproductive Class

## Definition

The class of artificers, manufacturers, and merchants who are considered by agricultural systems to be unproductive because their labour only replaces the value of the stock that employs them and their own consumption, without generating any net increase in the annual produce of land and labour.

## Source Chapter

Book IV, Chapter 9

## Context

Smith describes how agricultural systems denigrate merchants, artificers, and manufacturers as "barren" or "unproductive" because their work merely continues the existence of capital value without creating new value, contrasting this with the productive class of cultivators who generate surplus produce.

## Economic Domain

Distribution

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--- ENTITY: ground expenses ---

# Ground Expenses

## Definition

The expenses laid out by landlords upon the improvement of their land, including buildings, drains, enclosures, and other ameliorations that enable cultivators to raise greater produce with the same capital, thereby increasing the rent that can be paid to the proprietor.

## Source Chapter

Book IV, Chapter 9

## Context

Smith explains how agricultural systems classify landlord improvements as "ground expenses" (depenses foncieres) that are considered productive because they eventually reproduce their own value and generate a neat produce, making them worthy of protection from taxation and tithes until fully repaid.

## Economic Domain

Production

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--- ENTITY: original and annual expenses ---

# Original and Annual Expenses

## Definition

The expenses laid out by cultivators or farmers upon the cultivation of land, consisting of original expenses (instruments of husbandry, stock of cattle, seed, and maintenance during first occupancy) and annual expenses (seed, wear and tear of instruments, and annual maintenance of servants and cattle).

## Source Chapter

Book IV, Chapter 9

## Context

Smith details how agricultural systems categorize farmer expenses into original and annual components, explaining that these expenses must be regularly restored with reasonable profit for farmers to continue their business, and that the surplus produce remaining after these expenses constitutes the rent due to the landlord.

## Economic Domain

Production

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--- ENTITY: neat produce ---

# Neat Produce

## Definition

The surplus produce that remains after paying all necessary expenses of cultivation, including both the original and annual expenses of the farmer and the ground expenses of the landlord, which constitutes the real revenue and wealth of society in agricultural systems.

## Source Chapter

Book IV, Chapter 9

## Context

Smith explains how agricultural systems identify neat produce as the true measure of national wealth, distinguishing it from gross produce by deducting all necessary expenses, and showing how this concept underpins the classification of productive versus unproductive labour.

## Economic Domain

Production

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--- ENTITY: productive expenses ---

# Productive Expenses

## Definition

Those expenses which, over and above replacing their own value, occasion the annual reproduction of neat produce, including both the ground expenses of landlords and the original and annual expenses of farmers in agricultural systems.

## Source Chapter

Book IV, Chapter 9

## Context

Smith describes how agricultural systems designate certain expenses as "productive" because they generate surplus value beyond simple replacement, contrasting this with expenses on artificers and manufacturers which are considered barren and unproductive.

## Economic Domain

Production

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--- ENTITY: mercantile stock ---

# Mercantile Stock

## Definition

The capital employed in trade and commerce that is considered barren and unproductive in agricultural systems because it only continues the existence of its own value without producing any new value, similar to manufacturing stock.

## Source Chapter

Book IV, Chapter 9

## Context

Smith explains how agricultural systems classify mercantile stock alongside manufacturing stock as unproductive, arguing that both only replace their own value and the maintenance of their employers without generating the surplus produce that characterizes productive agricultural labour.

## Economic Domain

Distribution

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--- ENTITY: parsimony and privation ---

# Parsimony and Privation

## Definition

The economic principles by which nations composed chiefly of merchants, artificers, and manufacturers can grow rich only through saving and depriving themselves of enjoyment of part of their funds, as opposed to agricultural nations that can grow rich through industry and enjoyment.

## Source Chapter

Book IV, Chapter 9

## Context

Smith contrasts the economic strategies available to different types of nations, showing how agricultural systems recognize that commercial nations must rely on frugality and saving to accumulate wealth, while agricultural nations can simultaneously enjoy consumption and increase their revenue.

## Economic Domain

Accumulation

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--- ENTITY: economical table ---

# Economical Table

## Definition

A mathematical representation created by Mr. Quesnai that illustrates the distribution of the annual produce of land among the three classes of society under conditions of perfect liberty and highest prosperity, showing how each class receives its proper share.

## Source Chapter

Book IV, Chapter 9

## Context

Smith describes Quesnai's arithmetical formularies that attempt to model the distribution of national produce under different economic systems, with the "Economical Table" representing the ideal state of perfect liberty where the productive class receives its full share of the annual produce.

## Economic Domain

General Theory

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--- ENTITY: system of natural liberty ---

# System of Natural Liberty

## Definition

An economic system where perfect freedom of trade is established, allowing every man to pursue his own interest in his own way without violating laws of justice, resulting in the sovereign being discharged from directing private industry and confined to three essential duties.

## Source Chapter

Book IV, Chapter 9

## Context

Smith presents his alternative to both mercantile and agricultural systems, arguing that removing all systems of preference or restraint allows the natural system of perfect liberty to establish itself, which he considers the most effective means of promoting national prosperity.

## Economic Domain

General Theory

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--- ENTITY: three duties of the sovereign ---

# Three Duties of the Sovereign

## Definition

The three fundamental responsibilities of government under the system of natural liberty: protecting society from violence and invasion of other societies, protecting every member from injustice or oppression by other members, and erecting and maintaining certain public works and institutions that individuals cannot profitably provide.

## Source Chapter

Book IV, Chapter 9

## Context

Smith outlines the limited role of government in his preferred economic system, arguing that once systems of preference and restraint are removed, the sovereign's duties become clear and limited to defense, justice, and certain public works that benefit society as a whole.

## Economic Domain

Regulation

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