From db129fde6b134aee7cc860c0581532df1ee82ad3 Mon Sep 17 00:00:00 2001 From: tegwick Date: Thu, 19 Feb 2026 19:19:20 +0100 Subject: [PATCH] infospace: process book-1-chapter-11 Extract entities, map to VSM, and synthesize analysis. --- .../analyses/book-1-chapter-11-analysis.md | 154 + .../analyses/book-1-chapter-11-prompt.md | 7439 +++++++++++++++++ ...ok-1-chapter-11-synthesize-analysis-raw.md | 154 + .../agricultural-comparative-advantage.md | 21 + .../entities/agricultural-cultivation.md | 21 + .../output/entities/agricultural-demand.md | 21 + .../entities/agricultural-efficiency.md | 21 + .../entities/agricultural-improvement.md | 21 + .../agricultural-market-integration.md | 21 + .../entities/agricultural-price-ceilings.md | 19 + .../entities/agricultural-price-discovery.md | 21 + .../agricultural-price-discrimination.md | 21 + .../entities/agricultural-price-elasticity.md | 21 + .../entities/agricultural-price-floors.md | 21 + .../entities/agricultural-price-mechanism.md | 21 + 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00000000..133e7778 --- /dev/null +++ b/examples/infospace-with-history/output/analyses/book-1-chapter-11-analysis.md @@ -0,0 +1,154 @@ +# Chapter Analysis: Rent, Value, and the Viable System Model in Book I, Chapter 11 + +## Chapter Summary + +Book I, Chapter 11 of *The Wealth of Nations* presents Adam Smith's comprehensive analysis of land rent as a fundamental economic phenomenon. Smith establishes rent as a monopoly price determined by what tenants can afford to pay based on land's productive capacity, rather than by the landlord's investment in improvements. The chapter systematically examines how rent varies across different types of land and produce, from unimproved natural resources to highly cultivated vineyards and sugar colonies. Smith demonstrates that rent enters commodity prices differently from wages and profits, and he provides extensive historical evidence tracing the changing value of silver relative to corn over four centuries. The analysis reveals how agricultural improvements affect the distribution of economic returns between landlords, farmers, and consumers, and how different forms of rent (corn rent vs. money rent) coordinate economic activity. Throughout, Smith argues that rent is fundamentally based on agricultural surplus and that improvements in cultivation tend to increase the landlord's share of this surplus. The chapter concludes by establishing the three great economic orders—those who live by rent, wages, and profit—and their distinct relationships to the general interest of society. + +## Entities Extracted + +### Economic Entities + +- **rent-of-land**: Payment for land use based on productive capacity, not landlord investment +- **natural rent of land**: Typical market rent under ordinary conditions +- **monopoly price of land**: Rent exceeding competitive levels due to exclusive control +- **corn rent**: Rent paid in agricultural produce rather than money +- **money rent**: Rent paid in monetary form +- **unimproved land**: Natural land without human enhancements +- **improved land**: Land enhanced through human investment +- **pasture land**: Land used for grazing livestock +- **corn land**: Land used for grain production +- **vineyard**: Land cultivated for grape production +- **kitchen garden**: Land for growing vegetables and herbs +- **hop garden**: Land cultivated for hop production +- **fruit garden**: Land for growing fruit trees +- **fruit-wall**: Protective walls around gardens to extend growing seasons +- **sugar colonies**: Tropical plantations producing sugar +- **tobacco colonies**: North American plantations producing tobacco +- **rice countries**: Regions where rice is the primary crop +- **potato cultivation**: Growing potatoes as a staple crop +- **artificial grasses**: Cultivated forage crops like clover +- **inclosure**: Surrounding land with fences or walls +- **public fiars**: Official grain price valuations in Scotland +- **conversion price**: Price for converting corn rent to money rent +- **statute of labourers**: 1351 English law regulating wages and prices +- **assize of bread and ale**: Medieval regulations setting food prices +- **exportation bounty**: Government subsidy for grain exports +- **kelp**: Seaweed producing alkaline salts +- **wood price**: Market price of timber and firewood +- **coal price**: Market price of coal +- **silver price variation**: Changes in silver's value relative to other goods +- **gold price variation**: Changes in gold's value relative to silver +- **precious metals consumption**: Use of gold and silver in various forms +- **annual consumption of metals**: Yearly use of precious metals +- **mine fertility**: Productivity of mineral mines +- **mine situation**: Geographical location of mines +- **landlord's share**: Portion of produce going to landlords as rent +- **farmer's profit**: Return to agricultural entrepreneurs +- **agricultural stock**: Capital invested in farming operations +- **labouring cattle**: Animals used for agricultural work +- **agricultural improvement**: Enhancements to farming practices +- **agricultural cultivation**: Practice of preparing and using land +- **agricultural surplus**: Excess produce beyond cultivation costs +- **agricultural demand**: Market demand for agricultural products +- **agricultural supply**: Quantity of agricultural products available +- **agricultural productivity**: Efficiency of agricultural production +- **agricultural efficiency**: Effectiveness of resource use in farming +- **agricultural technology**: Tools and methods used in farming +- **agricultural market integration**: Connection of agricultural markets through trade +- **agricultural specialization**: Concentration on specific crops or livestock +- **agricultural comparative advantage**: Relative efficiency in producing different products +- **agricultural trade**: Exchange of agricultural products between regions +- **agricultural price mechanism**: Market process determining agricultural prices +- **agricultural price regulation**: Government interventions in agricultural markets +- **agricultural price stability**: Constancy of agricultural prices over time +- **agricultural price volatility**: Fluctuations in agricultural prices +- **agricultural price discovery**: Process of establishing market prices +- **agricultural price transmission**: How price changes affect different markets +- **agricultural price discrimination**: Charging different prices for the same product +- **agricultural price elasticity**: Responsiveness of supply and demand to price changes +- **agricultural price floors**: Minimum prices set by government +- **agricultural price ceilings**: Maximum prices set by government + +## VSM Mappings + +### Strong Mappings + +- **rent-of-land → S1 (Operations)**: Land as autonomous operational unit producing value +- **rent-of-land → S3 (Control)**: Rent as regulatory mechanism for resource allocation +- **natural rent of land → S3 (Control)**: Baseline regulatory framework for land allocation +- **monopoly price of land → S3 (Control)**: Distortion in internal regulatory mechanisms +- **corn rent → S1 (Operations)**: Direct operational output of agricultural land +- **money rent → S2 (Coordination)**: Standardization mechanism for land value coordination +- **unimproved land → S1 (Operations)**: Autonomous operational unit based on natural capacity +- **improved land → S1 (Operations)**: Enhanced operational unit through human intervention +- **pasture land → S1 (Operations)**: Specialized operational unit for livestock grazing +- **corn land → S1 (Operations)**: Fundamental operational unit of agricultural production +- **vineyard → S1 (Operations)**: Specialized operational unit for high-value production +- **kitchen garden → S1 (Operations)**: Intensive operational unit maximizing value per land +- **hop garden → S1 (Operations)**: Specialized operational unit for specific high-value input +- **fruit garden → S1 (Operations)**: Long-term operational unit for high-value production +- **fruit-wall → S1 (Operations)**: Operational enhancement through infrastructure investment +- **sugar colonies → S1 (Operations)**: Highly specialized operational units with unique advantages +- **tobacco colonies → S1 (Operations)**: Specialized operational units for export production +- **rice countries → S1 (Operations)**: Specialized operational regions focused on rice +- **potato cultivation → S1 (Operations)**: Innovative operational practice increasing productivity +- **artificial grasses → S1 (Operations)**: Operational enhancements extending productive capacity +- **inclosure → S1 (Operations)**: Operational infrastructure improving productivity +- **public fiars → S2 (Coordination)**: Coordination mechanism standardizing grain prices +- **conversion price → S2 (Coordination)**: Coordination mechanism standardizing rent relationships +- **statute of labourers → S3 (Control)**: Direct regulatory control of economic operations +- **assize of bread and ale → S3 (Control)**: Regulatory control of essential goods prices +- **exportation bounty → S3 (Control)**: Regulatory control through government intervention +- **kelp → S1 (Operations)**: Autonomous operational activity based on natural resources +- **wood price → S4 (Intelligence)**: Environmental intelligence signal about resource scarcity +- **coal price → S4 (Intelligence)**: Environmental intelligence signal about resource distribution +- **silver price variation → S4 (Intelligence)**: Environmental intelligence about economic trends +- **gold price variation → S4 (Intelligence)**: Environmental intelligence about monetary systems +- **precious metals consumption → S1 (Operations)**: Operational use of resources in various forms + +## VSM Coverage + +The chapter demonstrates strong coverage of the VSM framework, particularly in Systems 1, 2, 3, and 4, with comprehensive mapping of economic entities to their corresponding VSM functions. + +### Covered Systems + +- **System 1 (S1) - Operations**: Extensively covered through numerous agricultural entities (land, crops, cultivation methods, improvements) that represent autonomous operational units producing value +- **System 2 (S2) - Coordination**: Well-represented through coordination mechanisms like money rent, public fiars, and conversion prices that standardize and harmonize economic activity +- **System 3 (S3) - Control**: Strongly covered through regulatory mechanisms including various forms of rent, price regulations, and government interventions that manage economic operations +- **System 4 (S4) - Intelligence**: Adequately represented through price variations and market signals that provide environmental intelligence for strategic adaptation + +### Uncovered Systems + +- **System 5 (S5) - Policy/Identity**: No explicit representation of the overarching policy-making body or economic identity that would balance internal and external demands +- **System 3* (S3*) - Audit/Monitoring**: No representation of audit or monitoring functions that would verify operational performance through direct investigation + +## Gaps & Observations + +### Missing VSM Systems + +The absence of System 5 (Policy/Identity) is particularly notable, as the chapter focuses heavily on operational mechanics and regulatory mechanisms but lacks representation of the supreme policy-making body that would establish the overall economic identity and balance competing interests. Similarly, the lack of System 3* (Audit/Monitoring) means there's no representation of the verification functions that would ensure operational compliance and performance measurement. + +### Difficult-to-Map Entities + +Some entities were challenging to map definitively to single VSM systems. For instance, agricultural price mechanisms and regulations could arguably belong to multiple systems depending on their specific function and level of operation. The historical price evidence (silver price variations) serves both intelligence and control functions, making precise categorization complex. + +### Emerging Patterns + +Several clear patterns emerge from the mappings: + +1. **Operational Dominance**: System 1 receives the most extensive coverage, reflecting Smith's focus on productive activities and land as the primary source of value creation +2. **Regulatory Emphasis**: System 3 is strongly represented, consistent with Smith's analysis of how different forms of rent and government interventions regulate economic activity +3. **Intelligence Through Prices**: System 4 is represented primarily through price mechanisms, showing how market prices serve as environmental intelligence signals +4. **Coordination Through Standardization**: System 2 is covered through mechanisms that standardize and coordinate economic activity across different regions and time periods + +### Suggestions for Enrichment + +To achieve more complete VSM coverage, future analysis could: + +1. **Identify Policy Frameworks**: Look for references to constitutional principles, national economic identity, or overarching policy frameworks that would represent System 5 +2. **Examine Verification Mechanisms**: Seek evidence of audit, inspection, or monitoring functions that would represent System 3* +3. **Analyze Emergent Regulation**: Consider how the "invisible hand" might function as an emergent control system beyond explicit government regulation +4. **Explore Long-term Strategic Planning**: Identify evidence of strategic responses to environmental changes that would strengthen System 4 coverage +5. **Consider Recursive Structure**: Examine how the five-system structure might recur at different levels (individual farms, regions, national economy) + +The chapter's strong representation of operational and control systems, combined with its analytical framework for understanding rent and value, provides an excellent foundation for VSM analysis, though it would benefit from explicit consideration of policy-making and audit functions to achieve complete systemic viability. \ No newline at end of file diff --git a/examples/infospace-with-history/output/analyses/book-1-chapter-11-prompt.md b/examples/infospace-with-history/output/analyses/book-1-chapter-11-prompt.md new file mode 100644 index 00000000..b71481c2 --- /dev/null +++ b/examples/infospace-with-history/output/analyses/book-1-chapter-11-prompt.md @@ -0,0 +1,7439 @@ +# Synthesize Chapter VSM Analysis + +You are an interdisciplinary analyst combining classical economics with +cybernetic systems theory. Your task is to produce a comprehensive +chapter-level analysis showing how economic content maps to the +Viable System Model. + +## Source Chapter + +--- +id: book-1-chapter-11 +title: "OF THE RENT OF LAND." +book: "1" +chapter: 11 +artifact_type: content +--- + +CHAPTER XI. +OF THE RENT OF LAND. + + + + Rent, considered as the price paid for the use of land, is naturally the + highest which the tenant can afford to pay in the actual circumstances of + the land. In adjusting the terms of the lease, the landlord endeavours to + leave him no greater share of the produce than what is sufficient to keep + up the stock from which he furnishes the seed, pays the labour, and + purchases and maintains the cattle and other instruments of husbandry, + together with the ordinary profits of farming stock in the neighbourhood. + This is evidently the smallest share with which the tenant can content + himself, without being a loser, and the landlord seldom means to leave him + any more. Whatever part of the produce, or, what is the same thing, + whatever part of its price, is over and above this share, he naturally + endeavours to reserve to himself as the rent of his land, which is + evidently the highest the tenant can afford to pay in the actual + circumstances of the land. Sometimes, indeed, the liberality, more + frequently the ignorance, of the landlord, makes him accept of somewhat + less than this portion; and sometimes, too, though more rarely, the + ignorance of the tenant makes him undertake to pay somewhat more, or to + content himself with somewhat less, than the ordinary profits of farming + stock in the neighbourhood. This portion, however, may still be considered + as the natural rent of land, or the rent at which it is naturally meant + that land should, for the most part, be let. + + The rent of land, it may be thought, is frequently no more than a + reasonable profit or interest for the stock laid out by the landlord upon + its improvement. This, no doubt, may be partly the case upon some + occasions; for it can scarce ever be more than partly the case. The + landlord demands a rent even for unimproved land, and the supposed + interest or profit upon the expense of improvement is generally an + addition to this original rent. Those improvements, besides, are not + always made by the stock of the landlord, but sometimes by that of the + tenant. When the lease comes to be renewed, however, the landlord commonly + demands the same augmentation of rent as if they had been all made by his + own. + + He sometimes demands rent for what is altogether incapable of human + improvements. Kelp is a species of sea-weed, which, when burnt, yields an + alkaline salt, useful for making glass, soap, and for several other + purposes. It grows in several parts of Great Britain, particularly in + Scotland, upon such rocks only as lie within the high-water mark, which + are twice every day covered with the sea, and of which the produce, + therefore, was never augmented by human industry. The landlord, however, + whose estate is bounded by a kelp shore of this kind, demands a rent for + it as much as for his corn-fields. + + The sea in the neighbourhood of the islands of Shetland is more than + commonly abundant in fish, which makes a great part of the subsistence of + their inhabitants. But, in order to profit by the produce of the water, + they must have a habitation upon the neighbouring land. The rent of the + landlord is in proportion, not to what the farmer can make by the land, + but to what he can make both by the land and the water. It is partly paid + in sea-fish; and one of the very few instances in which rent makes a part + of the price of that commodity, is to be found in that country. + + The rent of land, therefore, considered as the price paid for the use of + the land, is naturally a monopoly price. It is not at all proportioned to + what the landlord may have laid out upon the improvement of the land, or + to what he can afford to take, but to what the farmer can afford to give. + + Such parts only of the produce of land can commonly be brought to market, + of which the ordinary price is sufficient to replace the stock which must + be employed in bringing them thither, together with its ordinary profits. + If the ordinary price is more than this, the surplus part of it will + naturally go to the rent of the land. If it is not more, though the + commodity may be brought to market, it can afford no rent to the landlord. + Whether the price is, or is not more, depends upon the demand. + + There are some parts of the produce of land, for which the demand must + always be such as to afford a greater price than what is sufficient to + bring them to market; and there are others for which it either may or may + not be such as to afford this greater price. The former must always afford + a rent to the landlord. The latter sometimes may and sometimes may not, + according to different circumstances. + + Rent, it is to be observed, therefore, enters into the composition of the + price of commodities in a different way from wages and profit. High or low + wages and profit are the causes of high or low price; high or low rent is + the effect of it. It is because high or low wages and profit must be paid, + in order to bring a particular commodity to market, that its price is high + or low. But it is because its price is high or low, a great deal more, or + very little more, or no more, than what is sufficient to pay those wages + and profit, that it affords a high rent, or a low rent, or no rent at all. + + The particular consideration, first, of those parts of the produce of land + which always afford some rent; secondly, of those which sometimes may and + sometimes may not afford rent; and, thirdly, of the variations which, in + the different periods of improvement, naturally take place in the relative + value of those two different sorts of rude produce, when compared both + with one another and with manufactured commodities, will divide this + chapter into three parts. + + + + + PART I.—Of the Produce of Land which always affords Rent. + + As men, like all other animals, naturally multiply in proportion to the + means of their subsistence, food is always more or less in demand. It can + always purchase or command a greater or smaller quantity of labour, and + somebody can always be found who is willing to do something in order to + obtain it. The quantity of labour, indeed, which it can purchase, is not + always equal to what it could maintain, if managed in the most economical + manner, on account of the high wages which are sometimes given to labour; + but it can always purchase such a quantity of labour as it can maintain, + according to the rate at which that sort of labour is commonly maintained + in the neighbourhood. + + But land, in almost any situation, produces a greater quantity of food + than what is sufficient to maintain all the labour necessary for bringing + it to market, in the most liberal way in which that labour is ever + maintained. The surplus, too, is always more than sufficient to replace + the stock which employed that labour, together with its profits. + Something, therefore, always remains for a rent to the landlord. + + The most desert moors in Norway and Scotland produce some sort of pasture + for cattle, of which the milk and the increase are always more than + sufficient, not only to maintain all the labour necessary for tending + them, and to pay the ordinary profit to the farmer or the owner of the + herd or flock, but to afford some small rent to the landlord. The rent + increases in proportion to the goodness of the pasture. The same extent of + ground not only maintains a greater number of cattle, but as they are + brought within a smaller compass, less labour becomes requisite to tend + them, and to collect their produce. The landlord gains both ways; by the + increase of the produce, and by the diminution of the labour which must be + maintained out of it. + + The rent of land not only varies with its fertility, whatever be its + produce, but with its situation, whatever be its fertility. Land in the + neighbourhood of a town gives a greater rent than land equally fertile in + a distant part of the country. Though it may cost no more labour to + cultivate the one than the other, it must always cost more to bring the + produce of the distant land to market. A greater quantity of labour, + therefore, must be maintained out of it; and the surplus, from which are + drawn both the profit of the farmer and the rent of the landlord, must be + diminished. But in remote parts of the country, the rate of profit, as has + already been shewn, is generally higher than in the neighbourhood of a + large town. A smaller proportion of this diminished surplus, therefore, + must belong to the landlord. + + Good roads, canals, and navigable rivers, by diminishing the expense of + carriage, put the remote parts of the country more nearly upon a level + with those in the neighbourhood of the town. They are upon that account + the greatest of all improvements. They encourage the cultivation of the + remote, which must always be the most extensive circle of the country. + They are advantageous to the town by breaking down the monopoly of the + country in its neighbourhood. They are advantageous even to that part of + the country. Though they introduce some rival commodities into the old + market, they open many new markets to its produce. Monopoly, besides, is a + great enemy to good management, which can never be universally + established, but in consequence of that free and universal competition + which forces every body to have recourse to it for the sake of self + defence. It is not more than fifty years ago, that some of the counties in + the neighbourhood of London petitioned the parliament against the + extension of the turnpike roads into the remoter counties. Those remoter + counties, they pretended, from the cheapness of labour, would be able to + sell their grass and corn cheaper in the London market than themselves, + and would thereby reduce their rents, and ruin their cultivation. Their + rents, however, have risen, and their cultivation has been improved since + that time. + + A corn field of moderate fertility produces a much greater quantity of + food for man, than the best pasture of equal extent. Though its + cultivation requires much more labour, yet the surplus which remains after + replacing the seed and maintaining all that labour, is likewise much + greater. If a pound of butcher’s meat, therefore, was never supposed to be + worth more than a pound of bread, this greater surplus would everywhere be + of greater value and constitute a greater fund, both for the profit of the + farmer and the rent of the landlord. It seems to have done so universally + in the rude beginnings of agriculture. + + But the relative values of those two different species of food, bread and + butcher’s meat, are very different in the different periods of + agriculture. In its rude beginnings, the unimproved wilds, which then + occupy the far greater part of the country, are all abandoned to cattle. + There is more butcher’s meat than bread; and bread, therefore, is the food + for which there is the greatest competition, and which consequently brings + the greatest price. At Buenos Ayres, we are told by Ulloa, four reals, + one-and-twenty pence halfpenny sterling, was, forty or fifty years ago, + the ordinary price of an ox, chosen from a herd of two or three hundred. + He says nothing of the price of bread, probably because he found nothing + remarkable about it. An ox there, he says, costs little more than the + labour of catching him. But corn can nowhere be raised without a great + deal of labour; and in a country which lies upon the river Plate, at that + time the direct road from Europe to the silver mines of Potosi, the + money-price of labour could be very cheap. It is otherwise when + cultivation is extended over the greater part of the country. There is + then more bread than butcher’s meat. The competition changes its + direction, and the price of butcher’s meat becomes greater than the price + of bread. + + By the extension, besides, of cultivation, the unimproved wilds become + insufficient to supply the demand for butcher’s meat. A great part of the + cultivated lands must be employed in rearing and fattening cattle; of + which the price, therefore, must be sufficient to pay, not only the labour + necessary for tending them, but the rent which the landlord, and the + profit which the farmer, could have drawn from such land employed in + tillage. The cattle bred upon the most uncultivated moors, when brought to + the same market, are, in proportion to their weight or goodness, sold at + the same price as those which are reared upon the most improved land. The + proprietors of those moors profit by it, and raise the rent of their land + in proportion to the price of their cattle. It is not more than a century + ago, that in many parts of the Highlands of Scotland, butcher’s meat was + as cheap or cheaper than even bread made of oatmeal. The Union opened the + market of England to the Highland cattle. Their ordinary price, at + present, is about three times greater than at the beginning of the + century, and the rents of many Highland estates have been tripled and + quadrupled in the same time. In almost every part of Great Britain, a + pound of the best butcher’s meat is, in the present times, generally worth + more than two pounds of the best white bread; and in plentiful years it is + sometimes worth three or four pounds. + + It is thus that, in the progress of improvement, the rent and profit of + unimproved pasture come to be regulated in some measure by the rent and + profit of what is improved, and these again by the rent and profit of + corn. Corn is an annual crop; butcher’s meat, a crop which requires four + or five years to grow. As an acre of land, therefore, will produce a much + smaller quantity of the one species of food than of the other, the + inferiority of the quantity must be compensated by the superiority of the + price. If it was more than compensated, more corn-land would be turned + into pasture; and if it was not compensated, part of what was in pasture + would be brought back into corn. + + This equality, however, between the rent and profit of grass and those of + corn; of the land of which the immediate produce is food for cattle, and + of that of which the immediate produce is food for men, must be understood + to take place only through the greater part of the improved lands of a + great country. In some particular local situations it is quite otherwise, + and the rent and profit of grass are much superior to what can be made by + corn. + + Thus, in the neighbourhood of a great town, the demand for milk, and for + forage to horses, frequently contribute, together with the high price of + butcher’s meat, to raise the value of grass above what may be called its + natural proportion to that of corn. This local advantage, it is evident, + cannot be communicated to the lands at a distance. + + Particular circumstances have sometimes rendered some countries so + populous, that the whole territory, like the lands in the neighbourhood of + a great town, has not been sufficient to produce both the grass and the + corn necessary for the subsistence of their inhabitants. Their lands, + therefore, have been principally employed in the production of grass, the + more bulky commodity, and which cannot be so easily brought from a great + distance; and corn, the food of the great body of the people, has been + chiefly imported from foreign countries. Holland is at present in this + situation; and a considerable part of ancient Italy seems to have been so + during the prosperity of the Romans. To feed well, old Cato said, as we + are told by Cicero, was the first and most profitable thing in the + management of a private estate; to feed tolerably well, the second; and to + feed ill, the third. To plough, he ranked only in the fourth place of + profit and advantage. Tillage, indeed, in that part of ancient Italy which + lay in the neighbour hood of Rome, must have been very much discouraged by + the distributions of corn which were frequently made to the people, either + gratuitously, or at a very low price. This corn was brought from the + conquered provinces, of which several, instead of taxes, were obliged to + furnish a tenth part of their produce at a stated price, about sixpence + a-peck, to the republic. The low price at which this corn was distributed + to the people, must necessarily have sunk the price of what could be + brought to the Roman market from Latium, or the ancient territory of Rome, + and must have discouraged its cultivation in that country. + + In an open country, too, of which the principal produce is corn, a + well-inclosed piece of grass will frequently rent higher than any corn + field in its neighbourhood. It is convenient for the maintenance of the + cattle employed in the cultivation of the corn; and its high rent is, in + this case, not so properly paid from the value of its own produce, as from + that of the corn lands which are cultivated by means of it. It is likely + to fall, if ever the neighbouring lands are completely inclosed. The + present high rent of inclosed land in Scotland seems owing to the scarcity + of inclosure, and will probably last no longer than that scarcity. The + advantage of inclosure is greater for pasture than for corn. It saves the + labour of guarding the cattle, which feed better, too, when they are not + liable to be disturbed by their keeper or his dog. + + But where there is no local advantage of this kind, the rent and profit of + corn, or whatever else is the common vegetable food of the people, must + naturally regulate upon the land which is fit for producing it, the rent + and profit of pasture. + + The use of the artificial grasses, of turnips, carrots, cabbages, and the + other expedients which have been fallen upon to make an equal quantity of + land feed a greater number of cattle than when in natural grass, should + somewhat reduce, it might be expected, the superiority which, in an + improved country, the price of butcher’s meat naturally has over that of + bread. It seems accordingly to have done so; and there is some reason for + believing that, at least in the London market, the price of butcher’s + meat, in proportion to the price of bread, is a good deal lower in the + present times than it was in the beginning of the last century. + + In the Appendix to the life of Prince Henry, Doctor Birch has given us an + account of the prices of butcher’s meat as commonly paid by that prince. + It is there said, that the four quarters of an ox, weighing six hundred + pounds, usually cost him nine pounds ten shillings, or thereabouts; that + is thirty-one shillings and eight-pence per hundred pounds weight. Prince + Henry died on the 6th of November 1612, in the nineteenth year of his age. + + In March 1764, there was a parliamentary inquiry into the causes of the + high price of provisions at that time. It was then, among other proof to + the same purpose, given in evidence by a Virginia merchant, that in March + 1763, he had victualled his ships for twentyfour or twenty-five shillings + the hundred weight of beef, which he considered as the ordinary price; + whereas, in that dear year, he had paid twenty-seven shillings for the + same weight and sort. This high price in 1764 is, however, four shillings + and eight-pence cheaper than the ordinary price paid by Prince Henry; and + it is the best beef only, it must be observed, which is fit to be salted + for those distant voyages. + + The price paid by Prince Henry amounts to 3d. ⅘ths per pound weight of + the whole carcase, coarse and choice pieces taken together; and at that + rate the choice pieces could not have been sold by retail for less than + 4½d. or 5d. the pound. + + In the parliamentary inquiry in 1764, the witnesses stated the price of + the choice pieces of the best beef to be to the consumer 4d. and 4½d. the + pound; and the coarse pieces in general to be from seven farthings to 2½d. + and 2¾d.; and this, they said, was in general one halfpenny dearer than + the same sort of pieces had usually been sold in the month of March. But + even this high price is still a good deal cheaper than what we can well + suppose the ordinary retail price to have been in the time of Prince + Henry. + + During the first twelve years of the last century, the average price of + the best wheat at the Windsor market was £ 1:18:3½d. the quarter of nine + Winchester bushels. + + But in the twelve years preceding 1764 including that year, the average + price of the same measure of the best wheat at the same market was £ + 2:1:9½d. + + In the first twelve years of the last century, therefore, wheat appears to + have been a good deal cheaper, and butcher’s meat a good deal dearer, than + in the twelve years preceding 1764, including that year. + + In all great countries, the greater part of the cultivated lands are + employed in producing either food for men or food for cattle. The rent and + profit of these regulate the rent and profit of all other cultivated land. + If any particular produce afforded less, the land would soon be turned + into corn or pasture; and if any afforded more, some part of the lands in + corn or pasture would soon be turned to that produce. + + Those productions, indeed, which require either a greater original expense + of improvement, or a greater annual expense of cultivation in order to fit + the land for them, appear commonly to afford, the one a greater rent, the + other a greater profit, than corn or pasture. This superiority, however, + will seldom be found to amount to more than a reasonable interest or + compensation for this superior expense. + + In a hop garden, a fruit garden, a kitchen garden, both the rent of the + landlord, and the profit of the farmer, are generally greater than in + acorn or grass field. But to bring the ground into this condition requires + more expense. Hence a greater rent becomes due to the landlord. It + requires, too, a more attentive and skilful management. Hence a greater + profit becomes due to the farmer. The crop, too, at least in the hop and + fruit garden, is more precarious. Its price, therefore, besides + compensating all occasional losses, must afford something like the profit + of insurance. The circumstances of gardeners, generally mean, and always + moderate, may satisfy us that their great ingenuity is not commonly + over-recompensed. Their delightful art is practised by so many rich people + for amusement, that little advantage is to be made by those who practise + it for profit; because the persons who should naturally be their best + customers, supply themselves with all their most precious productions. + + The advantage which the landlord derives from such improvements, seems at + no time to have been greater than what was sufficient to compensate the + original expense of making them. In the ancient husbandry, after the + vineyard, a well-watered kitchen garden seems to have been the part of the + farm which was supposed to yield the most valuable produce. But + Democritus, who wrote upon husbandry about two thousand years ago, and who + was regarded by the ancients as one of the fathers of the art, thought + they did not act wisely who inclosed a kitchen garden. The profit, he + said, would not compensate the expense of a stone-wall: and bricks (he + meant, I suppose, bricks baked in the sun) mouldered with the rain and the + winter-storm, and required continual repairs. Columella, who reports this + judgment of Democritus, does not controvert it, but proposes a very frugal + method of inclosing with a hedge of brambles and briars, which he says he + had found by experience to be both a lasting and an impenetrable fence; + but which, it seems, was not commonly known in the time of Democritus. + Palladius adopts the opinion of Columella, which had before been + recommended by Varro. In the judgment of those ancient improvers, the + produce of a kitchen garden had, it seems, been little more than + sufficient to pay the extraordinary culture and the expense of watering; + for in countries so near the sun, it was thought proper, in those times as + in the present, to have the command of a stream of water, which could be + conducted to every bed in the garden. Through the greater part of Europe, + a kitchen garden is not at present supposed to deserve a better inclosure + than that recommended by Columella. In Great Britain, and some other + northern countries, the finer fruits cannot be brought to perfection but + by the assistance of a wall. Their price, therefore, in such countries, + must be sufficient to pay the expense of building and maintaining what + they cannot be had without. The fruit-wall frequently surrounds the + kitchen garden, which thus enjoys the benefit of an inclosure which its + own produce could seldom pay for. + + That the vineyard, when properly planted and brought to perfection, was + the most valuable part of the farm, seems to have been an undoubted maxim + in the ancient agriculture, as it is in the modern, through all the wine + countries. But whether it was advantageous to plant a new vineyard, was a + matter of dispute among the ancient Italian husbandmen, as we learn from + Columella. He decides, like a true lover of all curious cultivation, in + favour of the vineyard; and endeavours to shew, by a comparison of the + profit and expense, that it was a most advantageous improvement. Such + comparisons, however, between the profit and expense of new projects are + commonly very fallacious; and in nothing more so than in agriculture. Had + the gain actually made by such plantations been commonly as great as he + imagined it might have been, there could have been no dispute about it. + The same point is frequently at this day a matter of controversy in the + wine countries. Their writers on agriculture, indeed, the lovers and + promoters of high cultivation, seem generally disposed to decide with + Columella in favour of the vineyard. In France, the anxiety of the + proprietors of the old vineyards to prevent the planting of any new ones, + seems to favour their opinion, and to indicate a consciousness in those + who must have the experience, that this species of cultivation is at + present in that country more profitable than any other. It seems, at the + same time, however, to indicate another opinion, that this superior profit + can last no longer than the laws which at present restrain the free + cultivation of the vine. In 1731, they obtained an order of council, + prohibiting both the planting of new vineyards, and the renewal of these + old ones, of which the cultivation had been interrupted for two years, + without a particular permission from the king, to be granted only in + consequence of an information from the intendant of the province, + certifying that he had examined the land, and that it was incapable of any + other culture. The pretence of this order was the scarcity of corn and + pasture, and the superabundance of wine. But had this superabundance been + real, it would, without any order of council, have effectually prevented + the plantation of new vineyards, by reducing the profits of this species + of cultivation below their natural proportion to those of corn and + pasture. With regard to the supposed scarcity of corn occasioned by the + multiplication of vineyards, corn is nowhere in France more carefully + cultivated than in the wine provinces, where the land is fit for producing + it: as in Burgundy, Guienne, and the Upper Languedoc. The numerous hands + employed in the one species of cultivation necessarily encourage the + other, by affording a ready market for its produce. To diminish the number + of those who are capable of paying it, is surely a most unpromising + expedient for encouraging the cultivation of corn. It is like the policy + which would promote agriculture, by discouraging manufactures. + + The rent and profit of those productions, therefore, which require either + a greater original expense of improvement in order to fit the land for + them, or a greater annual expense of cultivation, though often much + superior to those of corn and pasture, yet when they do no more than + compensate such extraordinary expense, are in reality regulated by the + rent and profit of those common crops. + + It sometimes happens, indeed, that the quantity of land which can be + fitted for some particular produce, is too small to supply the effectual + demand. The whole produce can be disposed of to those who are willing to + give somewhat more than what is sufficient to pay the whole rent, wages, + and profit, necessary for raising and bringing it to market, according to + their natural rates, or according to the rates at which they are paid in + the greater part of other cultivated land. The surplus part of the price + which remains after defraying the whole expense of improvement and + cultivation, may commonly, in this case, and in this case only, bear no + regular proportion to the like surplus in corn or pasture, but may exceed + it in almost any degree; and the greater part of this excess naturally + goes to the rent of the landlord. + + The usual and natural proportion, for example, between the rent and profit + of wine, and those of corn and pasture, must be understood to take place + only with regard to those vineyards which produce nothing but good common + wine, such as can be raised almost anywhere, upon any light, gravelly, or + sandy soil, and which has nothing to recommend it but its strength and + wholesomeness. It is with such vineyards only, that the common land of the + country can be brought into competition; for with those of a peculiar + quality it is evident that it cannot. + + The vine is more affected by the difference of soils than any other + fruit-tree. From some it derives a flavour which no culture or management + can equal, it is supposed, upon any other. This flavour, real or + imaginary, is sometimes peculiar to the produce of a few vineyards; + sometimes it extends through the greater part of a small district, and + sometimes through a considerable part of a large province. The whole + quantity of such wines that is brought to market falls short of the + effectual demand, or the demand of those who would be willing to pay the + whole rent, profit, and wages, necessary for preparing and bringing them + thither, according to the ordinary rate, or according to the rate at which + they are paid in common vineyards. The whole quantity, therefore, can be + disposed of to those who are willing to pay more, which necessarily raises + their price above that of common wine. The difference is greater or less, + according as the fashionableness and scarcity of the wine render the + competition of the buyers more or less eager. Whatever it be, the greater + part of it goes to the rent of the landlord. For though such vineyards are + in general more carefully cultivated than most others, the high price of + the wine seems to be, not so much the effect, as the cause of this careful + cultivation. In so valuable a produce, the loss occasioned by negligence + is so great, as to force even the most careless to attention. A small part + of this high price, therefore, is sufficient to pay the wages of the + extraordinary labour bestowed upon their cultivation, and the profits of + the extraordinary stock which puts that labour into motion. + + The sugar colonies possessed by the European nations in the West Indies + may be compared to those precious vineyards. Their whole produce falls + short of the effectual demand of Europe, and can be disposed of to those + who are willing to give more than what is sufficient to pay the whole + rent, profit, and wages, necessary for preparing and bringing it to + market, according to the rate at which they are commonly paid by any other + produce. In Cochin China, the finest white sugar generally sells for three + piastres the quintal, about thirteen shillings and sixpence of our money, + as we are told by Mr Poivre {Voyages d’un Philosophe.}, a very careful + observer of the agriculture of that country. What is there called the + quintal, weighs from a hundred and fifty to two hundred Paris pounds, or a + hundred and seventy-five Paris pounds at a medium, which reduces the price + of the hundred weight English to about eight shillings sterling; not a + fourth part of what is commonly paid for the brown or muscovada sugars + imported from our colonies, and not a sixth part of what is paid for the + finest white sugar. The greater part of the cultivated lands in Cochin + China are employed in producing corn and rice, the food of the great body + of the people. The respective prices of corn, rice, and sugar, are there + probably in the natural proportion, or in that which naturally takes place + in the different crops of the greater part of cultivated land, and which + recompenses the landlord and farmer, as nearly as can be computed, + according to what is usually the original expense of improvement, and the + annual expense of cultivation. But in our sugar colonies, the price of + sugar bears no such proportion to that of the produce of a rice or corn + field either in Europe or America. It is commonly said that a sugar + planter expects that the rum and the molasses should defray the whole + expense of his cultivation, and that his sugar should be all clear profit. + If this be true, for I pretend not to affirm it, it is as if a corn farmer + expected to defray the expense of his cultivation with the chaff and the + straw, and that the grain should be all clear profit. We see frequently + societies of merchants in London, and other trading towns, purchase waste + lands in our sugar colonies, which they expect to improve and cultivate + with profit, by means of factors and agents, notwithstanding the great + distance and the uncertain returns, from the defective administration of + justice in those countries. Nobody will attempt to improve and cultivate + in the same manner the most fertile lands of Scotland, Ireland, or the + corn provinces of North America, though, from the more exact + administration of justice in these countries, more regular returns might + be expected. + + In Virginia and Maryland, the cultivation of tobacco is preferred, as most + profitable, to that of corn. Tobacco might be cultivated with advantage + through the greater part of Europe; but, in almost every part of Europe, + it has become a principal subject of taxation; and to collect a tax from + every different farm in the country where this plant might happen to be + cultivated, would be more difficult, it has been supposed, than to levy + one upon its importation at the custom-house. The cultivation of tobacco + has, upon this account, been most absurdly prohibited through the greater + part of Europe, which necessarily gives a sort of monopoly to the + countries where it is allowed; and as Virginia and Maryland produce the + greatest quantity of it, they share largely, though with some competitors, + in the advantage of this monopoly. The cultivation of tobacco, however, + seems not to be so advantageous as that of sugar. I have never even heard + of any tobacco plantation that was improved and cultivated by the capital + of merchants who resided in Great Britain; and our tobacco colonies send + us home no such wealthy planters as we see frequently arrive from our + sugar islands. Though, from the preference given in those colonies to the + cultivation of tobacco above that of corn, it would appear that the + effectual demand of Europe for tobacco is not completely supplied, it + probably is more nearly so than that for sugar; and though the present + price of tobacco is probably more than sufficient to pay the whole rent, + wages, and profit, necessary for preparing and bringing it to market, + according to the rate at which they are commonly paid in corn land, it + must not be so much more as the present price of sugar. Our tobacco + planters, accordingly, have shewn the same fear of the superabundance of + tobacco, which the proprietors of the old vineyards in France have of the + superabundance of wine. By act of assembly, they have restrained its + cultivation to six thousand plants, supposed to yield a thousand weight of + tobacco, for every negro between sixteen and sixty years of age. Such a + negro, over and above this quantity of tobacco, can manage, they reckon, + four acres of Indian corn. To prevent the market from being overstocked, + too, they have sometimes, in plentiful years, we are told by Dr Douglas + {Douglas’s Summary, vol. ii. p. 379, 373.} (I suspect he has been ill + informed), burnt a certain quantity of tobacco for every negro, in the + same manner as the Dutch are said to do of spices. If such violent methods + are necessary to keep up the present price of tobacco, the superior + advantage of its culture over that of corn, if it still has any, will not + probably be of long continuance. + + It is in this manner that the rent of the cultivated land, of which the + produce is human food, regulates the rent of the greater part of other + cultivated land. No particular produce can long afford less, because the + land would immediately be turned to another use; and if any particular + produce commonly affords more, it is because the quantity of land which + can be fitted for it is too small to supply the effectual demand. + + In Europe, corn is the principal produce of land, which serves immediately + for human food. Except in particular situations, therefore, the rent of + corn land regulates in Europe that of all other cultivated land. Britain + need envy neither the vineyards of France, nor the olive plantations of + Italy. Except in particular situations, the value of these is regulated by + that of corn, in which the fertility of Britain is not much inferior to + that of either of those two countries. + + If, in any country, the common and favourite vegetable food of the people + should be drawn from a plant of which the most common land, with the same, + or nearly the same culture, produced a much greater quantity than the most + fertile does of corn; the rent of the landlord, or the surplus quantity of + food which would remain to him, after paying the labour, and replacing the + stock of the farmer, together with its ordinary profits, would necessarily + be much greater. Whatever was the rate at which labour was commonly + maintained in that country, this greater surplus could always maintain a + greater quantity of it, and, consequently, enable the landlord to purchase + or command a greater quantity of it. The real value of his rent, his real + power and authority, his command of the necessaries and conveniencies of + life with which the labour of other people could supply him, would + necessarily be much greater. + + A rice field produces a much greater quantity of food than the most + fertile corn field. Two crops in the year, from thirty to sixty bushels + each, are said to be the ordinary produce of an acre. Though its + cultivation, therefore, requires more labour, a much greater surplus + remains after maintaining all that labour. In those rice countries, + therefore, where rice is the common and favourite vegetable food of the + people, and where the cultivators are chiefly maintained with it, a + greater share of this greater surplus should belong to the landlord than + in corn countries. In Carolina, where the planters, as in other British + colonies, are generally both farmers and landlords, and where rent, + consequently, is confounded with profit, the cultivation of rice is found + to be more profitable than that of corn, though their fields produce only + one crop in the year, and though, from the prevalence of the customs of + Europe, rice is not there the common and favourite vegetable food of the + people. + + A good rice field is a bog at all seasons, and at one season a bog covered + with water. It is unfit either for corn, or pasture, or vineyard, or, + indeed, for any other vegetable produce that is very useful to men; and + the lands which are fit for those purposes are not fit for rice. Even in + the rice countries, therefore, the rent of rice lands cannot regulate the + rent of the other cultivated land which can never be turned to that + produce. + + The food produced by a field of potatoes is not inferior in quantity to + that produced by a field of rice, and much superior to what is produced by + a field of wheat. Twelve thousand weight of potatoes from an acre of land + is not a greater produce than two thousand weight of wheat. The food or + solid nourishment, indeed, which can be drawn from each of those two + plants, is not altogether in proportion to their weight, on account of the + watery nature of potatoes. Allowing, however, half the weight of this root + to go to water, a very large allowance, such an acre of potatoes will + still produce six thousand weight of solid nourishment, three times the + quantity produced by the acre of wheat. An acre of potatoes is cultivated + with less expense than an acre of wheat; the fallow, which generally + precedes the sowing of wheat, more than compensating the hoeing and other + extraordinary culture which is always given to potatoes. Should this root + ever become in any part of Europe, like rice in some rice countries, the + common and favourite vegetable food of the people, so as to occupy the + same proportion of the lands in tillage, which wheat and other sorts of + grain for human food do at present, the same quantity of cultivated land + would maintain a much greater number of people; and the labourers being + generally fed with potatoes, a greater surplus would remain after + replacing all the stock, and maintaining all the labour employed in + cultivation. A greater share of this surplus, too, would belong to the + landlord. Population would increase, and rents would rise much beyond what + they are at present. + + The land which is fit for potatoes, is fit for almost every other useful + vegetable. If they occupied the same proportion of cultivated land which + corn does at present, they would regulate, in the same manner, the rent of + the greater part of other cultivated land. + + In some parts of Lancashire, it is pretended, I have been told, that bread + of oatmeal is a heartier food for labouring people than wheaten bread, and + I have frequently heard the same doctrine held in Scotland. I am, however, + somewhat doubtful of the truth of it. The common people in Scotland, who + are fed with oatmeal, are in general neither so strong nor so handsome as + the same rank of people in England, who are fed with wheaten bread. They + neither work so well, nor look so well; and as there is not the same + difference between the people of fashion in the two countries, experience + would seem to shew, that the food of the common people in Scotland is not + so suitable to the human constitution as that of their neighbours of the + same rank in England. But it seems to be otherwise with potatoes. The + chairmen, porters, and coal-heavers in London, and those unfortunate women + who live by prostitution, the strongest men and the most beautiful women + perhaps in the British dominions, are said to be, the greater part of + them, from the lowest rank of people in Ireland, who are generally fed + with this root. No food can afford a more decisive proof of its nourishing + quality, or of its being peculiarly suitable to the health of the human + constitution. + + It is difficult to preserve potatoes through the year, and impossible to + store them like corn, for two or three years together. The fear of not + being able to sell them before they rot, discourages their cultivation, + and is, perhaps, the chief obstacle to their ever becoming in any great + country, like bread, the principal vegetable food of all the different + ranks of the people. + + + + + PART II.—Of the Produce of Land, which sometimes does, and sometimes + does not, afford Rent. + + Human food seems to be the only produce of land, which always and + necessarily affords some rent to the landlord. Other sorts of produce + sometimes may, and sometimes may not, according to different + circumstances. + + After food, clothing and lodging are the two great wants of mankind. + + Land, in its original rude state, can afford the materials of clothing and + lodging to a much greater number of people than it can feed. In its + improved state, it can sometimes feed a greater number of people than it + can supply with those materials; at least in the way in which they require + them, and are willing to pay for them. In the one state, therefore, there + is always a superabundance of these materials, which are frequently, upon + that account, of little or no value. In the other, there is often a + scarcity, which necessarily augments their value. In the one state, a + great part of them is thrown away as useless and the price of what is used + is considered as equal only to the labour and expense of fitting it for + use, and can, therefore, afford no rent to the landlord. In the other, + they are all made use of, and there is frequently a demand for more than + can be had. Somebody is always willing to give more for every part of + them, than what is sufficient to pay the expense of bringing them to + market. Their price, therefore, can always afford some rent to the + landlord. + + The skins of the larger animals were the original materials of clothing. + Among nations of hunters and shepherds, therefore, whose food consists + chiefly in the flesh of those animals, everyman, by providing himself with + food, provides himself with the materials of more clothing than he can + wear. If there was no foreign commerce, the greater part of them would be + thrown away as things of no value. This was probably the case among the + hunting nations of North America, before their country was discovered by + the Europeans, with whom they now exchange their surplus peltry, for + blankets, fire-arms, and brandy, which gives it some value. In the present + commercial state of the known world, the most barbarous nations, I + believe, among whom land property is established, have some foreign + commerce of this kind, and find among their wealthier neighbours such a + demand for all the materials of clothing, which their land produces, and + which can neither be wrought up nor consumed at home, as raises their + price above what it costs to send them to those wealthier neighbours. It + affords, therefore, some rent to the landlord. When the greater part of + the Highland cattle were consumed on their own hills, the exportation of + their hides made the most considerable article of the commerce of that + country, and what they were exchanged for afforded some addition to the + rent of the Highland estates. The wool of England, which in old times, + could neither be consumed nor wrought up at home, found a market in the + then wealthier and more industrious country of Flanders, and its price + afforded something to the rent of the land which produced it. In countries + not better cultivated than England was then, or than the Highlands of + Scotland are now, and which had no foreign commerce, the materials of + clothing would evidently be so superabundant, that a great part of them + would be thrown away as useless, and no part could afford any rent to the + landlord. + + The materials of lodging cannot always be transported to so great a + distance as those of clothing, and do not so readily become an object of + foreign commerce. When they are superabundant in the country which + produces them, it frequently happens, even in the present commercial state + of the world, that they are of no value to the landlord. A good stone + quarry in the neighbourhood of London would afford a considerable rent. In + many parts of Scotland and Wales it affords none. Barren timber for + building is of great value in a populous and well-cultivated country, and + the land which produces it affords a considerable rent. But in many parts + of North America, the landlord would be much obliged to any body who would + carry away the greater part of his large trees. In some parts of the + Highlands of Scotland, the bark is the only part of the wood which, for + want of roads and water-carriage, can be sent to market; the timber is + left to rot upon the ground. When the materials of lodging are so + superabundant, the part made use of is worth only the labour and expense + of fitting it for that use. It affords no rent to the landlord, who + generally grants the use of it to whoever takes the trouble of asking it. + The demand of wealthier nations, however, sometimes enables him to get a + rent for it. The paving of the streets of London has enabled the owners of + some barren rocks on the coast of Scotland to draw a rent from what never + afforded any before. The woods of Norway, and of the coasts of the Baltic, + find a market in many parts of Great Britain, which they could not find at + home, and thereby afford some rent to their proprietors. + + Countries are populous, not in proportion to the number of people whom + their produce can clothe and lodge, but in proportion to that of those + whom it can feed. When food is provided, it is easy to find the necessary + clothing and lodging. But though these are at hand, it may often be + difficult to find food. In some parts of the British dominions, what is + called a house may be built by one day’s labour of one man. The simplest + species of clothing, the skins of animals, require somewhat more labour to + dress and prepare them for use. They do not, however, require a great + deal. Among savage or barbarous nations, a hundredth, or little more than + a hundredth part of the labour of the whole year, will be sufficient to + provide them with such clothing and lodging as satisfy the greater part of + the people. All the other ninety-nine parts are frequently no more than + enough to provide them with food. + + But when, by the improvement and cultivation of land, the labour of one + family can provide food for two, the labour of half the society becomes + sufficient to provide food for the whole. The other half, therefore, or at + least the greater part of them, can be employed in providing other things, + or in satisfying the other wants and fancies of mankind. Clothing and + lodging, household furniture, and what is called equipage, are the + principal objects of the greater part of those wants and fancies. The rich + man consumes no more food than his poor neighbour. In quality it may be + very different, and to select and prepare it may require more labour and + art; but in quantity it is very nearly the same. But compare the spacious + palace and great wardrobe of the one, with the hovel and the few rags of + the other, and you will be sensible that the difference between their + clothing, lodging, and household furniture, is almost as great in quantity + as it is in quality. The desire of food is limited in every man by the + narrow capacity of the human stomach; but the desire of the conveniencies + and ornaments of building, dress, equipage, and household furniture, seems + to have no limit or certain boundary. Those, therefore, who have the + command of more food than they themselves can consume, are always willing + to exchange the surplus, or, what is the same thing, the price of it, for + gratifications of this other kind. What is over and above satisfying the + limited desire, is given for the amusement of those desires which cannot + be satisfied, but seem to be altogether endless. The poor, in order to + obtain food, exert themselves to gratify those fancies of the rich; and to + obtain it more certainly, they vie with one another in the cheapness and + perfection of their work. The number of workmen increases with the + increasing quantity of food, or with the growing improvement and + cultivation of the lands; and as the nature of their business admits of + the utmost subdivisions of labour, the quantity of materials which they + can work up, increases in a much greater proportion than their numbers. + Hence arises a demand for every sort of material which human invention can + employ, either usefully or ornamentally, in building, dress, equipage, or + household furniture; for the fossils and minerals contained in the bowels + of the earth, the precious metals, and the precious stones. + + Food is, in this manner, not only the original source of rent, but every + other part of the produce of land which afterwards affords rent, derives + that part of its value from the improvement of the powers of labour in + producing food, by means of the improvement and cultivation of land. + + Those other parts of the produce of land, however, which afterwards afford + rent, do not afford it always. Even in improved and cultivated countries, + the demand for them is not always such as to afford a greater price than + what is sufficient to pay the labour, and replace, together with its + ordinary profits, the stock which must be employed in bringing them to + market. Whether it is or is not such, depends upon different + circumstances. + + Whether a coal mine, for example, can afford any rent, depends partly upon + its fertility, and partly upon its situation. + + A mine of any kind may be said to be either fertile or barren, according + as the quantity of mineral which can be brought from it by a certain + quantity of labour, is greater or less than what can be brought by an + equal quantity from the greater part of other mines of the same kind. + + Some coal mines, advantageously situated, cannot be wrought on account of + their barrenness. The produce does not pay the expense. They can afford + neither profit nor rent. + + There are some, of which the produce is barely sufficient to pay the + labour, and replace, together with its ordinary profits, the stock + employed in working them. They afford some profit to the undertaker of the + work, but no rent to the landlord. They can be wrought advantageously by + nobody but the landlord, who, being himself the undertaker of the work, + gets the ordinary profit of the capital which he employs in it. Many coal + mines in Scotland are wrought in this manner, and can be wrought in no + other. The landlord will allow nobody else to work them without paying + some rent, and nobody can afford to pay any. + + Other coal mines in the same country, sufficiently fertile, cannot be + wrought on account of their situation. A quantity of mineral, sufficient + to defray the expense of working, could be brought from the mine by the + ordinary, or even less than the ordinary quantity of labour: but in an + inland country, thinly inhabited, and without either good roads or + water-carriage, this quantity could not be sold. + + Coals are a less agreeable fuel than wood: they are said too to be less + wholesome. The expense of coals, therefore, at the place where they are + consumed, must generally be somewhat less than that of wood. + + The price of wood, again, varies with the state of agriculture, nearly in + the same manner, and exactly for the same reason, as the price of cattle. + In its rude beginnings, the greater part of every country is covered with + wood, which is then a mere incumbrance, of no value to the landlord, who + would gladly give it to any body for the cutting. As agriculture advances, + the woods are partly cleared by the progress of tillage, and partly go to + decay in consequence of the increased number of cattle. These, though they + do not increase in the same proportion as corn, which is altogether the + acquisition of human industry, yet multiply under the care and protection + of men, who store up in the season of plenty what may maintain them in + that of scarcity; who, through the whole year, furnish them with a greater + quantity of food than uncultivated nature provides for them; and who, by + destroying and extirpating their enemies, secure them in the free + enjoyment of all that she provides. Numerous herds of cattle, when allowed + to wander through the woods, though they do not destroy the old trees, + hinder any young ones from coming up; so that, in the course of a century + or two, the whole forest goes to ruin. The scarcity of wood then raises + its price. It affords a good rent; and the landlord sometimes finds that + he can scarce employ his best lands more advantageously than in growing + barren timber, of which the greatness of the profit often compensates the + lateness of the returns. This seems, in the present times, to be nearly + the state of things in several parts of Great Britain, where the profit of + planting is found to be equal to that of either corn or pasture. The + advantage which the landlord derives from planting can nowhere exceed, at + least for any considerable time, the rent which these could afford him; + and in an inland country, which is highly cultivated, it will frequently + not fall much short of this rent. Upon the sea-coast of a well-improved + country, indeed, if coals can conveniently be had for fuel, it may + sometimes be cheaper to bring barren timber for building from less + cultivated foreign countries than to raise it at home. In the new town of + Edinburgh, built within these few years, there is not, perhaps, a single + stick of Scotch timber. + + Whatever may be the price of wood, if that of coals is such that the + expense of a coal fire is nearly equal to that of a wood one we may be + assured, that at that place, and in these circumstances, the price of + coals is as high as it can be. It seems to be so in some of the inland + parts of England, particularly in Oxfordshire, where it is usual, even in + the fires of the common people, to mix coals and wood together, and where + the difference in the expense of those two sorts of fuel cannot, + therefore, be very great. Coals, in the coal countries, are everywhere + much below this highest price. If they were not, they could not bear the + expense of a distant carriage, either by land or by water. A small + quantity only could be sold; and the coal masters and the coal proprietors + find it more for their interest to sell a great quantity at a price + somewhat above the lowest, than a small quantity at the highest. The most + fertile coal mine, too, regulates the price of coals at all the other + mines in its neighbourhood. Both the proprietor and the undertaker of the + work find, the one that he can get a greater rent, the other that he can + get a greater profit, by somewhat underselling all their neighbours. Their + neighbours are soon obliged to sell at the same price, though they cannot + so well afford it, and though it always diminishes, and sometimes takes + away altogether, both their rent and their profit. Some works are + abandoned altogether; others can afford no rent, and can be wrought only + by the proprietor. + + The lowest price at which coals can be sold for any considerable time, is, + like that of all other commodities, the price which is barely sufficient + to replace, together with its ordinary profits, the stock which must be + employed in bringing them to market. At a coal mine for which the landlord + can get no rent, but, which he must either work himself or let it alone + altogether, the price of coals must generally be nearly about this price. + + Rent, even where coals afford one, has generally a smaller share in their + price than in that of most other parts of the rude produce of land. The + rent of an estate above ground, commonly amounts to what is supposed to be + a third of the gross produce; and it is generally a rent certain and + independent of the occasional variations in the crop. In coal mines, a + fifth of the gross produce is a very great rent, a tenth the common rent; + and it is seldom a rent certain, but depends upon the occasional + variations in the produce. These are so great, that in a country where + thirty years purchase is considered as a moderate price for the property + of a landed estate, ten years purchase is regarded as a good price for + that of a coal mine. + + The value of a coal mine to the proprietor, frequently depends as much + upon its situation as upon its fertility. That of a metallic mine depends + more upon its fertility, and less upon its situation. The coarse, and + still more the precious metals, when separated from the ore, are so + valuable, that they can generally bear the expense of a very long land, + and of the most distant sea carriage. Their market is not confined to the + countries in the neighbourhood of the mine, but extends to the whole + world. The copper of Japan makes an article of commerce in Europe; the + iron of Spain in that of Chili and Peru. The silver of Peru finds its way, + not only to Europe, but from Europe to China. + + The price of coals in Westmoreland or Shropshire can have little effect on + their price at Newcastle; and their price in the Lionnois can have none at + all. The productions of such distant coal mines can never be brought into + competition with one another. But the productions of the most distant + metallic mines frequently may, and in fact commonly are. + + The price, therefore, of the coarse, and still more that of the precious + metals, at the most fertile mines in the world, must necessarily more or + less affect their price at every other in it. The price of copper in Japan + must have some influence upon its price at the copper mines in Europe. The + price of silver in Peru, or the quantity either of labour or of other + goods which it will purchase there, must have some influence on its price, + not only at the silver mines of Europe, but at those of China. After the + discovery of the mines of Peru, the silver mines of Europe were, the + greater part of them, abandoned. The value of silver was so much reduced, + that their produce could no longer pay the expense of working them, or + replace, with a profit, the food, clothes, lodging, and other necessaries + which were consumed in that operation. This was the case, too, with the + mines of Cuba and St. Domingo, and even with the ancient mines of Peru, + after the discovery of those of Potosi. The price of every metal, at every + mine, therefore, being regulated in some measure by its price at the most + fertile mine in the world that is actually wrought, it can, at the greater + part of mines, do very little more than pay the expense of working, and + can seldom afford a very high rent to the landlord. Rent accordingly, + seems at the greater part of mines to have but a small share in the price + of the coarse, and a still smaller in that of the precious metals. Labour + and profit make up the greater part of both. + + A sixth part of the gross produce may be reckoned the average rent of the + tin mines of Cornwall, the most fertile that are known in the world, as we + are told by the Rev. Mr Borlace, vice-warden of the stannaries. Some, he + says, afford more, and some do not afford so much. A sixth part of the + gross produce is the rent, too, of several very fertile lead mines in + Scotland. + + In the silver mines of Peru, we are told by Frezier and Ulloa, the + proprietor frequently exacts no other acknowledgment from the undertaker + of the mine, but that he will grind the ore at his mill, paying him the + ordinary multure or price of grinding. Till 1736, indeed, the tax of the + king of Spain amounted to one fifth of the standard silver, which till + then might be considered as the real rent of the greater part of the + silver mines of Peru, the richest which have been known in the world. If + there had been no tax, this fifth would naturally have belonged to the + landlord, and many mines might have been wrought which could not then be + wrought, because they could not afford this tax. The tax of the duke of + Cornwall upon tin is supposed to amount to more than five per cent. or one + twentieth part of the value; and whatever may be his proportion, it would + naturally, too, belong to the proprietor of the mine, if tin was duty + free. But if you add one twentieth to one sixth, you will find that the + whole average rent of the tin mines of Cornwall, was to the whole average + rent of the silver mines of Peru, as thirteen to twelve. But the silver + mines of Peru are not now able to pay even this low rent; and the tax upon + silver was, in 1736, reduced from one fifth to one tenth. Even this tax + upon silver, too, gives more temptation to smuggling than the tax of one + twentieth upon tin; and smuggling must be much easier in the precious than + in the bulky commodity. The tax of the king of Spain, accordingly, is said + to be very ill paid, and that of the duke of Cornwall very well. Rent, + therefore, it is probable, makes a greater part of the price of tin at the + most fertile tin mines than it does of silver at the most fertile silver + mines in the world. After replacing the stock employed in working those + different mines, together with its ordinary profits, the residue which + remains to the proprietor is greater, it seems, in the coarse, than in the + precious metal. + + Neither are the profits of the undertakers of silver mines commonly very + great in Peru. The same most respectable and well-informed authors + acquaint us, that when any person undertakes to work a new mine in Peru, + he is universally looked upon as a man destined to bankruptcy and ruin, + and is upon that account shunned and avoided by every body. Mining, it + seems, is considered there in the same light as here, as a lottery, in + which the prizes do not compensate the blanks, though the greatness of + some tempts many adventurers to throw away their fortunes in such + unprosperous projects. + + As the sovereign, however, derives a considerable part of his revenue from + the produce of silver mines, the law in Peru gives every possible + encouragement to the discovery and working of new ones. Whoever discovers + a new mine, is entitled to measure off two hundred and forty-six feet in + length, according to what he supposes to be the direction of the vein, and + half as much in breadth. He becomes proprietor of this portion of the + mine, and can work it without paving any acknowledgment to the landlord. + The interest of the duke of Cornwall has given occasion to a regulation + nearly of the same kind in that ancient dutchy. In waste and uninclosed + lands, any person who discovers a tin mine may mark out its limits to a + certain extent, which is called bounding a mine. The bounder becomes the + real proprietor of the mine, and may either work it himself, or give it in + lease to another, without the consent of the owner of the land, to whom, + however, a very small acknowledgment must be paid upon working it. In both + regulations, the sacred rights of private property are sacrificed to the + supposed interests of public revenue. + + The same encouragement is given in Peru to the discovery and working of + new gold mines; and in gold the king’s tax amounts only to a twentieth + part of the standard rental. It was once a fifth, and afterwards a tenth, + as in silver; but it was found that the work could not bear even the + lowest of these two taxes. If it is rare, however, say the same authors, + Frezier and Ulloa, to find a person who has made his fortune by a silver, + it is still much rarer to find one who has done so by a gold mine. This + twentieth part seems to be the whole rent which is paid by the greater + part of the gold mines of Chili and Peru. Gold, too, is much more liable + to be smuggled than even silver; not only on account of the superior value + of the metal in proportion to its bulk, but on account of the peculiar way + in which nature produces it. Silver is very seldom found virgin, but, like + most other metals, is generally mineralized with some other body, from + which it is impossible to separate it in such quantities as will pay for + the expense, but by a very laborious and tedious operation, which cannot + well be carried on but in work-houses erected for the purpose, and, + therefore, exposed to the inspection of the king’s officers. Gold, on the + contrary, is almost always found virgin. It is sometimes found in pieces + of some bulk; and, even when mixed, in small and almost insensible + particles, with sand, earth, and other extraneous bodies, it can be + separated from them by a very short and simple operation, which can be + carried on in any private house by any body who is possessed of a small + quantity of mercury. If the king’s tax, therefore, is but ill paid upon + silver, it is likely to be much worse paid upon gold; and rent must make a + much smaller part of the price of gold than that of silver. + + The lowest price at which the precious metals can be sold, or the smallest + quantity of other goods for which they can be exchanged, during any + considerable time, is regulated by the same principles which fix the + lowest ordinary price of all other goods. The stock which must commonly be + employed, the food, clothes, and lodging, which must commonly be consumed + in bringing them from the mine to the market, determine it. It must at + least be sufficient to replace that stock, with the ordinary profits. + + Their highest price, however, seems not to be necessarily determined by + any thing but the actual scarcity or plenty of these metals themselves. It + is not determined by that of any other commodity, in the same manner as + the price of coals is by that of wood, beyond which no scarcity can ever + raise it. Increase the scarcity of gold to a certain degree, and the + smallest bit of it may become more precious than a diamond, and exchange + for a greater quantity of other goods. + + The demand for those metals arises partly from their utility, and partly + from their beauty. If you except iron, they are more useful than, perhaps, + any other metal. As they are less liable to rust and impurity, they can + more easily be kept clean; and the utensils, either of the table or the + kitchen, are often, upon that account, more agreeable when made of them. A + silver boiler is more cleanly than a lead, copper, or tin one; and the + same quality would render a gold boiler still better than a silver one. + Their principal merit, however, arises from their beauty, which renders + them peculiarly fit for the ornaments of dress and furniture. No paint or + dye can give so splendid a colour as gilding. The merit of their beauty is + greatly enhanced by their scarcity. With the greater part of rich people, + the chief enjoyment of riches consists in the parade of riches; which, in + their eye, is never so complete as when they appear to possess those + decisive marks of opulence which nobody can possess but themselves. In + their eyes, the merit of an object, which is in any degree either useful + or beautiful, is greatly enhanced by its scarcity, or by the great labour + which it requires to collect any considerable quantity of it; a labour + which nobody can afford to pay but themselves. Such objects they are + willing to purchase at a higher price than things much more beautiful and + useful, but more common. These qualities of utility, beauty, and scarcity, + are the original foundation of the high price of those metals, or of the + great quantity of other goods for which they can everywhere be exchanged. + This value was antecedent to, and independent of their being employed as + coin, and was the quality which fitted them for that employment. That + employment, however, by occasioning a new demand, and by diminishing the + quantity which could be employed in any other way, may have afterwards + contributed to keep up or increase their value. + + The demand for the precious stones arises altogether from their beauty. + They are of no use but as ornaments; and the merit of their beauty is + greatly enhanced by their scarcity, or by the difficulty and expense of + getting them from the mine. Wages and profit accordingly make up, upon + most occasions, almost the whole of the high price. Rent comes in but for + a very small share, frequently for no share; and the most fertile mines + only afford any considerable rent. When Tavernier, a jeweller, visited the + diamond mines of Golconda and Visiapour, he was informed that the + sovereign of the country, for whose benefit they were wrought, had ordered + all of them to be shut up except those which yielded the largest and + finest stones. The other, it seems, were to the proprietor not worth the + working. + + As the prices, both of the precious metals and of the precious stones, is + regulated all over the world by their price at the most fertile mine in + it, the rent which a mine of either can afford to its proprietor is in + proportion, not to its absolute, but to what may be called its relative + fertility, or to its superiority over other mines of the same kind. If new + mines were discovered, as much superior to those of Potosi, as they were + superior to those of Europe, the value of silver might be so much degraded + as to render even the mines of Potosi not worth the working. Before the + discovery of the Spanish West Indies, the most fertile mines in Europe may + have afforded as great a rent to their proprietors as the richest mines in + Peru do at present. Though the quantity of silver was much less, it might + have exchanged for an equal quantity of other goods, and the proprietor’s + share might have enabled him to purchase or command an equal quantity + either of labour or of commodities. + + The value, both of the produce and of the rent, the real revenue which + they afforded, both to the public and to the proprietor, might have been + the same. + + The most abundant mines, either of the precious metals, or of the precious + stones, could add little to the wealth of the world. A produce, of which + the value is principally derived from its scarcity, is necessarily + degraded by its abundance. A service of plate, and the other frivolous + ornaments of dress and furniture, could be purchased for a smaller + quantity of commodities; and in this would consist the sole advantage + which the world could derive from that abundance. + + It is otherwise in estates above ground. The value, both of their produce + and of their rent, is in proportion to their absolute, and not to their + relative fertility. The land which produces a certain quantity of food, + clothes, and lodging, can always feed, clothe, and lodge, a certain number + of people; and whatever may be the proportion of the landlord, it will + always give him a proportionable command of the labour of those people, + and of the commodities with which that labour can supply him. The value of + the most barren land is not diminished by the neighbourhood of the most + fertile. On the contrary, it is generally increased by it. The great + number of people maintained by the fertile lands afford a market to many + parts of the produce of the barren, which they could never have found + among those whom their own produce could maintain. + + Whatever increases the fertility of land in producing food, increases not + only the value of the lands upon which the improvement is bestowed, but + contributes likewise to increase that of many other lands, by creating a + new demand for their produce. That abundance of food, of which, in + consequence of the improvement of land, many people have the disposal + beyond what they themselves can consume, is the great cause of the demand, + both for the precious metals and the precious stones, as well as for every + other conveniency and ornament of dress, lodging, household furniture, and + equipage. Food not only constitutes the principal part of the riches of + the world, but it is the abundance of food which gives the principal part + of their value to many other sorts of riches. The poor inhabitants of Cuba + and St. Domingo, when they were first discovered by the Spaniards, used to + wear little bits of gold as ornaments in their hair and other parts of + their dress. They seemed to value them as we would do any little pebbles + of somewhat more than ordinary beauty, and to consider them as just worth + the picking up, but not worth the refusing to any body who asked them, + They gave them to their new guests at the first request, without seeming + to think that they had made them any very valuable present. They were + astonished to observe the rage of the Spaniards to obtain them; and had no + notion that there could anywhere be a country in which many people had the + disposal of so great a superfluity of food; so scanty always among + themselves, that, for a very small quantity of those glittering baubles, + they would willingly give as much as might maintain a whole family for + many years. Could they have been made to understand this, the passion of + the Spaniards would not have surprised them. + + + + + PART III.—Of the variations in the Proportion between the respective + Values of that sort of Produce which always affords Rent, and of that + which sometimes does, and sometimes does not, afford Rent. + + The increasing abundance of food, in consequence of the increasing + improvement and cultivation, must necessarily increase the demand for + every part of the produce of land which is not food, and which can be + applied either to use or to ornament. In the whole progress of + improvement, it might, therefore, be expected there should be only one + variation in the comparative values of those two different sorts of + produce. The value of that sort which sometimes does, and sometimes does + not afford rent, should constantly rise in proportion to that which always + affords some rent. As art and industry advance, the materials of clothing + and lodging, the useful fossils and materials of the earth, the precious + metals and the precious stones, should gradually come to be more and more + in demand, should gradually exchange for a greater and a greater quantity + of food; or, in other words, should gradually become dearer and dearer. + This, accordingly, has been the case with most of these things upon most + occasions, and would have been the case with all of them upon all + occasions, if particular accidents had not, upon some occasions, increased + the supply of some of them in a still greater proportion than the demand. + + The value of a free-stone quarry, for example, will necessarily increase + with the increasing improvement and population of the country round about + it, especially if it should be the only one in the neighbourhood. But the + value of a silver mine, even though there should not be another within a + thousand miles of it, will not necessarily increase with the improvement + of the country in which it is situated. The market for the produce of a + free-stone quarry can seldom extend more than a few miles round about it, + and the demand must generally be in proportion to the improvement and + population of that small district; but the market for the produce of a + silver mine may extend over the whole known world. Unless the world in + general, therefore, be advancing in improvement and population, the demand + for silver might not be at all increased by the improvement even of a + large country in the neighbourhood of the mine. Even though the world in + general were improving, yet if, in the course of its improvements, new + mines should be discovered, much more fertile than any which had been + known before, though the demand for silver would necessarily increase, yet + the supply might increase in so much a greater proportion, that the real + price of that metal might gradually fall; that is, any given quantity, a + pound weight of it, for example, might gradually purchase or command a + smaller and a smaller quantity of labour, or exchange for a smaller and a + smaller quantity of corn, the principal part of the subsistence of the + labourer. + + The great market for silver is the commercial and civilized part of the + world. + + If, by the general progress of improvement, the demand of this market + should increase, while, at the same time, the supply did not increase in + the same proportion, the value of silver would gradually rise in + proportion to that of corn. Any given quantity of silver would exchange + for a greater and a greater quantity of corn; or, in other words, the + average money price of corn would gradually become cheaper and cheaper. + + If, on the contrary, the supply, by some accident, should increase, for + many years together, in a greater proportion than the demand, that metal + would gradually become cheaper and cheaper; or, in other words, the + average money price of corn would, in spite of all improvements, gradually + become dearer and dearer. + + But if, on the other hand, the supply of that metal should increase nearly + in the same proportion as the demand, it would continue to purchase or + exchange for nearly the same quantity of corn; and the average money price + of corn would, in spite of all improvements. continue very nearly the + same. + + These three seem to exhaust all the possible combinations of events which + can happen in the progress of improvement; and during the course of the + four centuries preceding the present, if we may judge by what has happened + both in France and Great Britain, each of those three different + combinations seems to have taken place in the European market, and nearly + in the same order, too, in which I have here set them down. + + _Digression concerning the Variations in the value of Silver during the + Course of the Four last Centuries._ + + + + + First Period.—In 1350, and for some time before, the average price + of the quarter of wheat in England seems not to have been estimated lower + than four ounces of silver, Tower weight, equal to about twenty shillings + of our present money. From this price it seems to have fallen gradually to + two ounces of silver, equal to about ten shillings of our present money, + the price at which we find it estimated in the beginning of the sixteenth + century, and at which it seems to have continued to be estimated till + about 1570. + + In 1350, being the 25th of Edward III. was enacted what is called the + Statute of Labourers. In the preamble, it complains much of the insolence + of servants, who endeavoured to raise their wages upon their masters. It + therefore ordains, that all servants and labourers should, for the future, + be contented with the same wages and liveries (liveries in those times + signified not only clothes, but provisions) which they had been accustomed + to receive in the 20th year of the king, and the four preceding years; + that, upon this account, their livery-wheat should nowhere be estimated + higher than tenpence a-bushel, and that it should always be in the option + of the master to deliver them either the wheat or the money. Tenpence: + a-bushel, therefore, had, in the 25th of Edward III. been reckoned a very + moderate price of wheat, since it required a particular statute to oblige + servants to accept of it in exchange for their usual livery of provisions; + and it had been reckoned a reasonable price ten years before that, or in + the 16th year of the king, the term to which the statute refers. But in + the 16th year of Edward III. tenpence contained about half an ounce of + silver, Tower weight, and was nearly equal to half-a-crown of our present + money. Four ounces of silver, Tower weight, therefore, equal to six + shillings and eightpence of the money of those times, and to near twenty + shillings of that of the present, must have been reckoned a moderate price + for the quarter of eight bushels. + + This statute is surely a better evidence of what was reckoned, in those + times, a moderate price of grain, than the prices of some particular + years, which have generally been recorded by historians and other writers, + on account of their extraordinary dearness or cheapness, and from which, + therefore, it is difficult to form any judgment concerning what may have + been the ordinary price. There are, besides, other reasons for believing + that, in the beginning of the fourteenth century, and for some time + before, the common price of wheat was not less than four ounces of silver + the quarter, and that of other grain in proportion. + + In 1309, Ralph de Born, prior of St Augustine’s, Canterbury, gave a feast + upon his installation-day, of which William Thorn has preserved, not only + the bill of fare, but the prices of many particulars. In that feast were + consumed, 1st, fifty-three quarters of wheat, which cost nineteen pounds, + or seven shillings, and twopence a-quarter, equal to about one-and-twenty + shillings and sixpence of our present money; 2dly, fifty-eight quarters of + malt, which cost seventeen pounds ten shillings, or six shillings + a-quarter, equal to about eighteen shillings of our present money; 3dly, + twenty quarters of oats, which cost four pounds, or four shillings + a-quarter, equal to about twelve shillings of our present money. The + prices of malt and oats seem here to be higher than their ordinary + proportion to the price of wheat. + + These prices are not recorded, on account of their extraordinary dearness + or cheapness, but are mentioned accidentally, as the prices actually paid + for large quantities of grain consumed at a feast, which was famous for + its magnificence. + + In 1262, being the 51st of Henry III. was revived an ancient statute, + called the assize of bread and ale, which, the king says in the preamble, + had been made in the times of his progenitors, some time kings of England. + It is probably, therefore, as old at least as the time of his grandfather, + Henry II. and may have been as old as the Conquest. It regulates the price + of bread according as the prices of wheat may happen to be, from one + shilling to twenty shillings the quarter of the money of those times. But + statutes of this kind are generally presumed to provide with equal care + for all deviations from the middle price, for those below it, as well as + for those above it. Ten shillings, therefore, containing six ounces of + silver, Tower weight, and equal to about thirty shillings of our present + money, must, upon this supposition, have been reckoned the middle price of + the quarter of wheat when this statute was first enacted, and must have + continued to be so in the 51st of Henry III. We cannot, therefore, be very + wrong in supposing that the middle price was not less than one-third of + the highest price at which this statute regulates the price of bread, or + than six shillings and eightpence of the money of those times, containing + four ounces of silver, Tower weight. + + From these different facts, therefore, we seem to have some reason to + conclude that, about the middle of the fourteenth century, and for a + considerable time before, the average or ordinary price of the quarter of + wheat was not supposed to be less than four ounces of silver, Tower + weight. + + From about the middle of the fourteenth to the beginning of the sixteenth + century, what was reckoned the reasonable and moderate, that is, the + ordinary or average price of wheat, seems to have sunk gradually to about + one half of this price; so as at last to have fallen to about two ounces + of silver, Tower weight, equal to about ten shillings of our present + money. It continued to be estimated at this price till about 1570. + + In the household book of Henry, the fifth earl of Northumberland, drawn up + in 1512 there are two different estimations of wheat. In one of them it is + computed at six shilling and eightpence the quarter, in the other at five + shillings and eightpence only. In 1512, six shillings and eightpence + contained only two ounces of silver, Tower weight, and were equal to about + ten shillings of our present money. + + From the 25th of Edward III. to the beginning of the reign of Elizabeth, + during the space of more than two hundred years, six shillings and + eightpence, it appears from several different statutes, had continued to + be considered as what is called the moderate and reasonable, that is, the + ordinary or average price of wheat. The quantity of silver, however, + contained in that nominal sum was, during the course of this period, + continually diminishing in consequence of some alterations which were made + in the coin. But the increase of the value of silver had, it seems, so far + compensated the diminution of the quantity of it contained in the same + nominal sum, that the legislature did not think it worth while to attend + to this circumstance. + + Thus, in 1436, it was enacted, that wheat might be exported without a + licence when the price was so low as six shillings and eightpence: and in + 1463, it was enacted, that no wheat should be imported if the price was + not above six shillings and eightpence the quarter: The legislature had + imagined, that when the price was so low, there could be no inconveniency + in exportation, but that when it rose higher, it became prudent to allow + of importation. Six shillings and eightpence, therefore, containing about + the same quantity of silver as thirteen shillings and fourpence of our + present money (one-third part less than the same nominal sum contained in + the time of Edward III), had, in those times, been considered as what is + called the moderate and reasonable price of wheat. + + In 1554, by the 1st and 2nd of Philip and Mary, and in 1558, by the 1st of + Elizabeth, the exportation of wheat was in the same manner prohibited, + whenever the price of the quarter should exceed six shillings and + eightpence, which did not then contain two penny worth more silver than + the same nominal sum does at present. But it had soon been found, that to + restrain the exportation of wheat till the price was so very low, was, in + reality, to prohibit it altogether. In 1562, therefore, by the 5th of + Elizabeth, the exportation of wheat was allowed from certain ports, + whenever the price of the quarter should not exceed ten shillings, + containing nearly the same quantity of silver as the like nominal sum does + at present. This price had at this time, therefore, been considered as + what is called the moderate and reasonable price of wheat. It agrees + nearly with the estimation of the Northumberland book in 1512. + + That in France the average price of grain was, in the same manner, much + lower in the end of the fifteenth and beginning of the sixteenth century, + than in the two centuries preceding, has been observed both by Mr Dupré de + St Maur, and by the elegant author of the Essay on the Policy of Grain. + Its price, during the same period, had probably sunk in the same manner + through the greater part of Europe. + + This rise in the value of silver, in proportion to that of corn, may + either have been owing altogether to the increase of the demand for that + metal, in consequence of increasing improvement and cultivation, the + supply, in the mean time, continuing the same as before; or, the demand + continuing the same as before, it may have been owing altogether to the + gradual diminution of the supply: the greater part of the mines which were + then known in the world being much exhausted, and, consequently, the + expense of working them much increased; or it may have been owing partly + to the one, and partly to the other of those two circumstances. In the end + of the fifteenth and beginning of the sixteenth centuries, the greater + part of Europe was approaching towards a more settled form of government + than it had enjoyed for several ages before. The increase of security + would naturally increase industry and improvement; and the demand for the + precious metals, as well as for every other luxury and ornament, would + naturally increase with the increase of riches. A greater annual produce + would require a greater quantity of coin to circulate it; and a greater + number of rich people would require a greater quantity of plate and other + ornaments of silver. It is natural to suppose, too, that the greater part + of the mines which then supplied the European market with silver might be + a good deal exhausted, and have become more expensive in the working. They + had been wrought, many of them, from the time of the Romans. + + It has been the opinion, however, of the greater part of those who have + written upon the prices of commodities in ancient times, that, from the + Conquest, perhaps from the invasion of Julius Caesar, till the discovery + of the mines of America, the value of silver was continually diminishing. + This opinion they seem to have been led into, partly by the observations + which they had occasion to make upon the prices both of corn and of some + other parts of the rude produce of land, and partly by the popular notion, + that as the quantity of silver naturally increases in every country with + the increase of wealth, so its value diminishes as it quantity increases. + + In their observations upon the prices of corn, three different + circumstances seem frequently to have misled them. + + First, in ancient times, almost all rents were paid in kind; in a certain + quantity of corn, cattle, poultry, etc. It sometimes happened, however, + that the landlord would stipulate, that he should be at liberty to demand + of the tenant, either the annual payment in kind or a certain sum of money + instead of it. The price at which the payment in kind was in this manner + exchanged for a certain sum of money, is in Scotland called the conversion + price. As the option is always in the landlord to take either the + substance or the price, it is necessary, for the safety of the tenant, + that the conversion price should rather be below than above the average + market price. In many places, accordingly, it is not much above one half + of this price. Through the greater part of Scotland this custom still + continues with regard to poultry, and in some places with regard to + cattle. It might probably have continued to take place, too, with regard + to corn, had not the institution of the public fiars put an end to it. + These are annual valuations, according to the judgment of an assize, of + the average price of all the different sorts of grain, and of all the + different qualities of each, according to the actual market price in every + different county. This institution rendered it sufficiently safe for the + tenant, and much more convenient for the landlord, to convert, as they + call it, the corn rent, rather at what should happen to be the price of + the fiars of each year, than at any certain fixed price. But the writers + who have collected the prices of corn in ancient times seem frequently to + have mistaken what is called in Scotland the conversion price for the + actual market price. Fleetwood acknowledges, upon one occasion, that he + had made this mistake. As he wrote his book, however, for a particular + purpose, he does not think proper to make this acknowledgment till after + transcribing this conversion price fifteen times. The price is eight + shillings the quarter of wheat. This sum in 1423, the year at which he + begins with it, contained the same quantity of silver as sixteen shillings + of our present money. But in 1562, the year at which he ends with it, it + contained no more than the same nominal sum does at present. + + Secondly, they have been misled by the slovenly manner in which some + ancient statutes of assize had been sometimes transcribed by lazy copiers, + and sometimes, perhaps, actually composed by the legislature. + + The ancient statutes of assize seem to have begun always with determining + what ought to be the price of bread and ale when the price of wheat and + barley were at the lowest; and to have proceeded gradually to determine + what it ought to be, according as the prices of those two sorts of grain + should gradually rise above this lowest price. But the transcribers of + those statutes seem frequently to have thought it sufficient to copy the + regulation as far as the three or four first and lowest prices; saving in + this manner their own labour, and judging, I suppose, that this was enough + to show what proportion ought to be observed in all higher prices. + + Thus, in the assize of bread and ale, of the 51st of Henry III. the price + of bread was regulated according to the different prices of wheat, from + one shilling to twenty shillings the quarter of the money of those times. + But in the manuscripts from which all the different editions of the + statutes, preceding that of Mr Ruffhead, were printed, the copiers had + never transcribed this regulation beyond the price of twelve shillings. + Several writers, therefore, being misled by this faulty transcription, + very naturally conclude that the middle price, or six shillings the + quarter, equal to about eighteen shillings of our present money, was the + ordinary or average price of wheat at that time. + + In the statute of Tumbrel and Pillory, enacted nearly about the same time, + the price of ale is regulated according to every sixpence rise in the + price of barley, from two shillings, to four shillings the quarter. That + four shillings, however, was not considered as the highest price to which + barley might frequently rise in those times, and that these prices were + only given as an example of the proportion which ought to be observed in + all other prices, whether higher or lower, we may infer from the last + words of the statute: “Et sic deinceps crescetur vel diminuetur per sex + denarios.” The expression is very slovenly, but the meaning is plain + enough, “that the price of ale is in this manner to be increased or + diminished according to every sixpence rise or fall in the price of + barley.” In the composition of this statute, the legislature itself seems + to have been as negligent as the copiers were in the transcription of the + other. + + In an ancient manuscript of the Regiam Majestatem, an old Scotch law book, + there is a statute of assize, in which the price of bread is regulated + according to all the different prices of wheat, from tenpence to three + shillings the Scotch boll, equal to about half an English quarter. Three + shillings Scotch, at the time when this assize is supposed to have been + enacted, were equal to about nine shillings sterling of our present money. + Mr Ruddiman seems {See his Preface to Anderson’s Diplomata Scotiae.} to + conclude from this, that three shillings was the highest price to which + wheat ever rose in those times, and that tenpence, a shilling, or at most + two shillings, were the ordinary prices. Upon consulting the manuscript, + however, it appears evidently, that all these prices are only set down as + examples of the proportion which ought to be observed between the + respective prices of wheat and bread. The last words of the statute are + “reliqua judicabis secundum praescripta, habendo respectum ad pretium + bladi.”—“You shall judge of the remaining cases, according to what + is above written, having respect to the price of corn.” + + Thirdly, they seem to have been misled too, by the very low price at which + wheat was sometimes sold in very ancient times; and to have imagined, that + as its lowest price was then much lower than in later times its ordinary + price must likewise have been much lower. They might have found, however, + that in those ancient times its highest price was fully as much above, as + its lowest price was below any thing that had ever been known in later + times. Thus, in 1270, Fleetwood gives us two prices of the quarter of + wheat. The one is four pounds sixteen shillings of the money of those + times, equal to fourteen pounds eight shillings of that of the present; + the other is six pounds eight shillings, equal to nineteen pounds four + shillings of our present money. No price can be found in the end of the + fifteenth, or beginning of the sixteenth century, which approaches to the + extravagance of these. The price of corn, though at all times liable to + variation varies most in those turbulent and disorderly societies, in + which the interruption of all commerce and communication hinders the + plenty of one part of the country from relieving the scarcity of another. + In the disorderly state of England under the Plantagenets, who governed it + from about the middle of the twelfth till towards the end of the fifteenth + century, one district might be in plenty, while another, at no great + distance, by having its crop destroyed, either by some accident of the + seasons, or by the incursion of some neighbouring baron, might be + suffering all the horrors of a famine; and yet if the lands of some + hostile lord were interposed between them, the one might not be able to + give the least assistance to the other. Under the vigorous administration + of the Tudors, who governed England during the latter part of the + fifteenth, and through the whole of the sixteenth century, no baron was + powerful enough to dare to disturb the public security. + + The reader will find at the end of this chapter all the prices of wheat + which have been collected by Fleetwood, from 1202 to 1597, both inclusive, + reduced to the money of the present times, and digested, according to the + order of time, into seven divisions of twelve years each. At the end of + each division, too, he will find the average price of the twelve years of + which it consists. In that long period of time, Fleetwood has been able to + collect the prices of no more than eighty years; so that four years are + wanting to make out the last twelve years. I have added, therefore, from + the accounts of Eton college, the prices of 1598, 1599, 1600, and 1601. It + is the only addition which I have made. The reader will see, that from the + beginning of the thirteenth till after the middle of the sixteenth + century, the average price of each twelve years grows gradually lower and + lower; and that towards the end of the sixteenth century it begins to rise + again. The prices, indeed, which Fleetwood has been able to collect, seem + to have been those chiefly which were remarkable for extraordinary + dearness or cheapness; and I do not pretend that any very certain + conclusion can be drawn from them. So far, however, as they prove any + thing at all, they confirm the account which I have been endeavouring to + give. Fleetwood himself, however, seems, with most other writers, to have + believed, that, during all this period, the value of silver, in + consequence of its increasing abundance, was continually diminishing. The + prices of corn, which he himself has collected, certainly do not agree + with this opinion. They agree perfectly with that of Mr Dupré de St Maur, + and with that which I have been endeavouring to explain. Bishop Fleetwood + and Mr Dupré de St Maur are the two authors who seem to have collected, + with the greatest diligence and fidelity, the prices of things in ancient + times. It is somewhat curious that, though their opinions are so very + different, their facts, so far as they relate to the price of corn at + least, should coincide so very exactly. + + It is not, however, so much from the low price of corn, as from that of + some other parts of the rude produce of land, that the most judicious + writers have inferred the great value of silver in those very ancient + times. Corn, it has been said, being a sort of manufacture, was, in those + rude ages, much dearer in proportion than the greater part of other + commodities; it is meant, I suppose, than the greater part of + unmanufactured commodities, such as cattle, poultry, game of all kinds, + etc. That in those times of poverty and barbarism these were + proportionably much cheaper than corn, is undoubtedly true. But this + cheapness was not the effect of the high value of silver, but of the low + value of those commodities. It was not because silver would in such times + purchase or represent a greater quantity of labour, but because such + commodities would purchase or represent a much smaller quantity than in + times of more opulence and improvement. Silver must certainly be cheaper + in Spanish America than in Europe; in the country where it is produced, + than in the country to which it is brought, at the expense of a long + carriage both by land and by sea, of a freight, and an insurance. + One-and-twenty pence halfpenny sterling, however, we are told by Ulloa, + was, not many years ago, at Buenos Ayres, the price of an ox chosen from a + herd of three or four hundred. Sixteen shillings sterling, we are told by + Mr Byron, was the price of a good horse in the capital of Chili. In a + country naturally fertile, but of which the far greater part is altogether + uncultivated, cattle, poultry, game of all kinds, etc. as they can be + acquired with a very small quantity of labour, so they will purchase or + command but a very small quantity. The low money price for which they may + be sold, is no proof that the real value of silver is there very high, but + that the real value of those commodities is very low. + + Labour, it must always be remembered, and not any particular commodity, or + set of commodities, is the real measure of the value both of silver and of + all other commodities. + + But in countries almost waste, or but thinly inhabited, cattle, poultry, + game of all kinds, etc. as they are the spontaneous productions of Nature, + so she frequently produces them in much greater quantities than the + consumption of the inhabitants requires. In such a state of things, the + supply commonly exceeds the demand. In different states of society, in + different states of improvement, therefore, such commodities will + represent, or be equivalent, to very different quantities of labour. + + In every state of society, in every stage of improvement, corn is the + production of human industry. But the average produce of every sort of + industry is always suited, more or less exactly, to the average + consumption; the average supply to the average demand. In every different + stage of improvement, besides, the raising of equal quantities of corn in + the same soil and climate, will, at an average, require nearly equal + quantities of labour; or, what comes to the same thing, the price of + nearly equal quantities; the continual increase of the productive powers + of labour, in an improved state of cultivation, being more or less + counterbalanced by the continual increasing price of cattle, the principal + instruments of agriculture. Upon all these accounts, therefore, we may + rest assured, that equal quantities of corn will, in every state of + society, in every stage of improvement, more nearly represent, or be + equivalent to, equal quantities of labour, than equal quantities of any + other part of the rude produce of land. Corn, accordingly, it has already + been observed, is, in all the different stages of wealth and improvement, + a more accurate measure of value than any other commodity or set of + commodities. In all those different stages, therefore, we can judge better + of the real value of silver, by comparing it with corn, than by comparing + it with any other commodity or set of commodities. + + Corn, besides, or whatever else is the common and favourite vegetable food + of the people, constitutes, in every civilized country, the principal part + of the subsistence of the labourer. In consequence of the extension of + agriculture, the land of every country produces a much greater quantity of + vegetable than of animal food, and the labourer everywhere lives chiefly + upon the wholesome food that is cheapest and most abundant. Butcher’s + meat, except in the most thriving countries, or where labour is most + highly rewarded, makes but an insignificant part of his subsistence; + poultry makes a still smaller part of it, and game no part of it. In + France, and even in Scotland, where labour is somewhat better rewarded + than in France, the labouring poor seldom eat butcher’s meat, except upon + holidays, and other extraordinary occasions. The money price of labour, + therefore, depends much more upon the average money price of corn, the + subsistence of the labourer, than upon that of butcher’s meat, or of any + other part of the rude produce of land. The real value of gold and silver, + therefore, the real quantity of labour which they can purchase or command, + depends much more upon the quantity of corn which they can purchase or + command, than upon that of butcher’s meat, or any other part of the rude + produce of land. + + Such slight observations, however, upon the prices either of corn or of + other commodities, would not probably have misled so many intelligent + authors, had they not been influenced at the same time by the popular + notion, that as the quantity of silver naturally increases in every + country with the increase of wealth, so its value diminishes as its + quantity increases. This notion, however, seems to be altogether + groundless. + + The quantity of the precious metals may increase in any country from two + different causes; either, first, from the increased abundance of the mines + which supply it; or, secondly, from the increased wealth of the people, + from the increased produce of their annual labour. The first of these + causes is no doubt necessarily connected with the diminution of the value + of the precious metals; but the second is not. + + When more abundant mines are discovered, a greater quantity of the + precious metals is brought to market; and the quantity of the necessaries + and conveniencies of life for which they must be exchanged being the same + as before, equal quantities of the metals must be exchanged for smaller + quantities of commodities. So far, therefore, as the increase of the + quantity of the precious metals in any country arises from the increased + abundance of the mines, it is necessarily connected with some diminution + of their value. + + When, on the contrary, the wealth of any country increases, when the + annual produce of its labour becomes gradually greater and greater, a + greater quantity of coin becomes necessary in order to circulate a greater + quantity of commodities: and the people, as they can afford it, as they + have more commodities to give for it, will naturally purchase a greater + and a greater quantity of plate. The quantity of their coin will increase + from necessity; the quantity of their plate from vanity and ostentation, + or from the same reason that the quantity of fine statues, pictures, and + of every other luxury and curiosity, is likely to increase among them. But + as statuaries and painters are not likely to be worse rewarded in times of + wealth and prosperity, than in times of poverty and depression, so gold + and silver are not likely to be worse paid for. + + The price of gold and silver, when the accidental discovery of more + abundant mines does not keep it down, as it naturally rises with the + wealth of every country, so, whatever be the state of the mines, it is at + all times naturally higher in a rich than in a poor country. Gold and + silver, like all other commodities, naturally seek the market where the + best price is given for them, and the best price is commonly given for + every thing in the country which can best afford it. Labour, it must be + remembered, is the ultimate price which is paid for every thing; and in + countries where labour is equally well rewarded, the money price of labour + will be in proportion to that of the subsistence of the labourer. But gold + and silver will naturally exchange for a greater quantity of subsistence + in a rich than in a poor country; in a country which abounds with + subsistence, than in one which is but indifferently supplied with it. If + the two countries are at a great distance, the difference may be very + great; because, though the metals naturally fly from the worse to the + better market, yet it may be difficult to transport them in such + quantities as to bring their price nearly to a level in both. If the + countries are near, the difference will be smaller, and may sometimes be + scarce perceptible; because in this case the transportation will be easy. + China is a much richer country than any part of Europe, and the difference + between the price of subsistence in China and in Europe is very great. + Rice in China is much cheaper than wheat is any where in Europe. England + is a much richer country than Scotland, but the difference between the + money price of corn in those two countries is much smaller, and is but + just perceptible. In proportion to the quantity or measure, Scotch corn + generally appears to be a good deal cheaper than English; but, in + proportion to its quality, it is certainly somewhat dearer. Scotland + receives almost every year very large supplies from England, and every + commodity must commonly be somewhat dearer in the country to which it is + brought than in that from which it comes. English corn, therefore, must be + dearer in Scotland than in England; and yet in proportion to its quality, + or to the quantity and goodness of the flour or meal which can be made + from it, it cannot commonly be sold higher there than the Scotch corn + which comes to market in competition with it. + + The difference between the money price of labour in China and in Europe, + is still greater than that between the money price of subsistence; because + the real recompence of labour is higher in Europe than in China, the + greater part of Europe being in an improving state, while China seems to + be standing still. The money price of labour is lower in Scotland than in + England, because the real recompence of labour is much lower: Scotland, + though advancing to greater wealth, advances much more slowly than + England. The frequency of emigration from Scotland, and the rarity of it + from England, sufficiently prove that the demand for labour is very + different in the two countries. The proportion between the real recompence + of labour in different countries, it must be remembered, is naturally + regulated, not by their actual wealth or poverty, but by their advancing, + stationary, or declining condition. + + Gold and silver, as they are naturally of the greatest value among the + richest, so they are naturally of the least value among the poorest + nations. Among savages, the poorest of all nations, they are scarce of any + value. + + In great towns, corn is always dearer than in remote parts of the country. + This, however, is the effect, not of the real cheapness of silver, but of + the real dearness of corn. It does not cost less labour to bring silver to + the great town than to the remote parts of the country; but it costs a + great deal more to bring corn. + + In some very rich and commercial countries, such as Holland and the + territory of Genoa, corn is dear for the same reason that it is dear in + great towns. They do not produce enough to maintain their inhabitants. + They are rich in the industry and skill of their artificers and + manufacturers, in every sort of machinery which can facilitate and abridge + labour; in shipping, and in all the other instruments and means of + carriage and commerce: but they are poor in corn, which, as it must be + brought to them from distant countries, must, by an addition to its price, + pay for the carriage from those countries. It does not cost less labour to + bring silver to Amsterdam than to Dantzic; but it costs a great deal more + to bring corn. The real cost of silver must be nearly the same in both + places; but that of corn must be very different. Diminish the real + opulence either of Holland or of the territory of Genoa, while the number + of their inhabitants remains the same; diminish their power of supplying + themselves from distant countries; and the price of corn, instead of + sinking with that diminution in the quantity of their silver, which must + necessarily accompany this declension, either as its cause or as its + effect, will rise to the price of a famine. When we are in want of + necessaries, we must part with all superfluities, of which the value, as + it rises in times of opulence and prosperity, so it sinks in times of + poverty and distress. It is otherwise with necessaries. Their real price, + the quantity of labour which they can purchase or command, rises in times + of poverty and distress, and sinks in times of opulence and prosperity, + which are always times of great abundance; for they could not otherwise be + times of opulence and prosperity. Corn is a necessary, silver is only a + superfluity. + + Whatever, therefore, may have been the increase in the quantity of the + precious metals, which, during the period between the middle of the + fourteenth and that of the sixteenth century, arose from the increase of + wealth and improvement, it could have no tendency to diminish their value, + either in Great Britain, or in my other part of Europe. If those who have + collected the prices of things in ancient times, therefore, had, during + this period, no reason to infer the diminution of the value of silver from + any observations which they had made upon the prices either of corn, or of + other commodities, they had still less reason to infer it from any + supposed increase of wealth and improvement. + + Second Period.—But how various soever may have been the opinions of + the learned concerning the progress of the value of silver during the + first period, they are unanimous concerning it during the second. + + From about 1570 to about 1640, during a period of about seventy years, the + variation in the proportion between the value of silver and that of corn + held a quite opposite course. Silver sunk in its real value, or would + exchange for a smaller quantity of labour than before; and corn rose in + its nominal price, and, instead of being commonly sold for about two + ounces of silver the quarter, or about ten shillings of our present money, + came to be sold for six and eight ounces of silver the quarter, or about + thirty and forty shillings of our present money. + + The discovery of the abundant mines of America seems to have been the sole + cause of this diminution in the value of silver, in proportion to that of + corn. It is accounted for, accordingly, in the same manner by every body; + and there never has been any dispute, either about the fact, or about the + cause of it. The greater part of Europe was, during this period, advancing + in industry and improvement, and the demand for silver must consequently + have been increasing; but the increase of the supply had, it seems, so far + exceeded that of the demand, that the value of that metal sunk + considerably. The discovery of the mines of America, it is to be observed, + does not seem to have had any very sensible effect upon the prices of + things in England till after 1570; though even the mines of Potosi had + been discovered more than twenty years before. + + From 1595 to 1620, both inclusive, the average price of the quarter of + nine bushels of the best wheat, at Windsor market, appears, from the + accounts of Eton college, to have been £ 2:1:6 ⁹⁄₁₃. From which sum, + neglecting the fraction, and deducting a ninth, or 4s. 7 ⅓d., the price + of the quarter of eight bushels comes out to have been £ 1:16:10 ⅔. And + from this sum, neglecting likewise the fraction, and deducting a ninth, or + 4s. 1 ⅑d., for the difference between the price of the best wheat and + that of the middle wheat, the price of the middle wheat comes out to have + been about £ 1:12:8 ⁸⁄₉, or about six ounces and one-third of an ounce of + silver. + + From 1621 to 1636, both inclusive, the average price of the same measure + of the best wheat, at the same market, appears, from the same accounts, to + have been £ 2:10s.; from which, making the like deductions as in the + foregoing case, the average price of the quarter of eight bushels of + middle wheat comes out to have been £ 1:19:6, or about seven ounces and + two-thirds of an ounce of silver. + + Third Period.—Between 1630 and 1640, or about 1636, the effect of + the discovery of the mines of America, in reducing the value of silver, + appears to have been completed, and the value of that metal seems never to + have sunk lower in proportion to that of corn than it was about that time. + It seems to have risen somewhat in the course of the present century, and + it had probably begun to do so, even some time before the end of the last. + + From 1637 to 1700, both inclusive, being the sixty-four last years of the + last century the average price of the quarter of nine bushels of the best + wheat, at Windsor market, appears, from the same accounts, to have been £ + 2:11:0 ⅓, which is only 1s. 0 ⅓d. dearer than it had been during the + sixteen years before. But, in the course of these sixty-four years, there + happened two events, which must have produced a much greater scarcity of + corn than what the course of the seasons would otherwise have occasioned, + and which, therefore, without supposing any further reduction in the + value of silver, will much more than account for this very small + enhancement of price. + + The first of these events was the civil war, which, by discouraging + tillage and interrupting commerce, must have raised the price of corn much + above what the course of the seasons would otherwise have occasioned. It + must have had this effect, more or less, at all the different markets in + the kingdom, but particularly at those in the neighbourhood of London, + which require to be supplied from the greatest distance. In 1648, + accordingly, the price of the best wheat, at Windsor market, appears, from + the same accounts, to have been £ 4:5s., and, in 1649, to have been £ 4, + the quarter of nine bushels. The excess of those two years above £ 2:10s. + (the average price of the sixteen years preceding 1637) is £ 3:5s., which, + divided among the sixty four last years of the last century, will alone + very nearly account for that small enhancement of price which seems to + have taken place in them. These, however, though the highest, are by no + means the only high prices which seem to have been occasioned by the civil + wars. + + The second event was the bounty upon the exportation of corn, granted in + 1688. The bounty, it has been thought by many people, by encouraging + tillage, may, in a long course of years, have occasioned a greater + abundance, and, consequently, a greater cheapness of corn in the home + market, than what would otherwise have taken place there. How far the + bounty could produce this effect at any time I shall examine hereafter: I + shall only observe at present, that between 1688 and 1700, it had not time + to produce any such effect. During this short period, its only effect must + have been, by encouraging the exportation of the surplus produce of every + year, and thereby hindering the abundance of one year from compensating + the scarcity of another, to raise the price in the home market. The + scarcity which prevailed in England, from 1693 to 1699, both inclusive, + though no doubt principally owing to the badness of the seasons, and, + therefore, extending through a considerable part of Europe, must have been + somewhat enhanced by the bounty. In 1699, accordingly, the further + exportation of corn was prohibited for nine months. + + There was a third event which occurred in the course of the same period, + and which, though it could not occasion any scarcity of corn, nor, + perhaps, any augmentation in the real quantity of silver which was usually + paid for it, must necessarily have occasioned some augmentation in the + nominal sum. This event was the great debasement of the silver coin, by + clipping and wearing. This evil had begun in the reign of Charles II. and + had gone on continually increasing till 1695; at which time, as we may + learn from Mr Lowndes, the current silver coin was, at an average, near + five-and-twenty per cent. below its standard value. But the nominal sum + which constitutes the market price of every commodity is necessarily + regulated, not so much by the quantity of silver, which, according to the + standard, ought to be contained in it, as by that which, it is found by + experience, actually is contained in it. This nominal sum, therefore, is + necessarily higher when the coin is much debased by clipping and wearing, + than when near to its standard value. + + In the course of the present century, the silver coin has not at any time + been more below its standard weight than it is at present. But though very + much defaced, its value has been kept up by that of the gold coin, for + which it is exchanged. For though, before the late recoinage, the gold + coin was a good deal defaced too, it was less so than the silver. In 1695, + on the contrary, the value of the silver coin was not kept up by the gold + coin; a guinea then commonly exchanging for thirty shillings of the worn + and clipt silver. Before the late recoinage of the gold, the price of + silver bullion was seldom higher than five shillings and sevenpence an + ounce, which is but fivepence above the mint price. But in 1695, the + common price of silver bullion was six shillings and fivepence an ounce, + {Lowndes’s Essay on the Silver Coin, 68.} which is fifteen pence above the + mint price. Even before the late recoinage of the gold, therefore, the + coin, gold and silver together, when compared with silver bullion, was not + supposed to be more than eight per cent. below its standard value, In + 1695, on the contrary, it had been supposed to be near five-and-twenty per + cent. below that value. But in the beginning of the present century, that + is, immediately after the great recoinage in King William’s time, the + greater part of the current silver coin must have been still nearer to its + standard weight than it is at present. In the course of the present + century, too, there has been no great public calamity, such as a civil + war, which could either discourage tillage, or interrupt the interior + commerce of the country. And though the bounty which has taken place + through the greater part of this century, must always raise the price of + corn somewhat higher than it otherwise would be in the actual state of + tillage; yet, as in the course of this century, the bounty has had full + time to produce all the good effects commonly imputed to it to encourage + tillage, and thereby to increase the quantity of corn in the home market, + it may, upon the principles of a system which I shall explain and examine + hereafter, be supposed to have done something to lower the price of that + commodity the one way, as well as to raise it the other. It is by many + people supposed to have done more. In the sixty-four years of the present + century, accordingly, the average price of the quarter of nine bushels of + the best wheat, at Windsor market, appears, by the accounts of Eton + college, to have been £ 2:0:6 ¹⁰⁄₃₂, which is about ten shillings and + sixpence, or more than five-and-twenty percent. cheaper than it had been + during the sixty-four last years of the last century; and about nine + shillings and sixpence cheaper than it had been during the sixteen years + preceding 1636, when the discovery of the abundant mines of America may be + supposed to have produced its full effect; and about one shilling cheaper + than it had been in the twenty-six years preceding 1620, before that + discovery can well be supposed to have produced its full effect. According + to this account, the average price of middle wheat, during these + sixty-four first years of the present century, comes out to have been + about thirty-two shillings the quarter of eight bushels. + + The value of silver, therefore, seems to have risen somewhat in proportion + to that of corn during the course of the present century, and it had + probably begun to do so even some time before the end of the last. + + In 1687, the price of the quarter of nine bushels of the best wheat, at + Windsor market, was £ 1:5:2, the lowest price at which it had ever been + from 1595. + + In 1688, Mr Gregory King, a man famous for his knowledge in matters of + this kind, estimated the average price of wheat, in years of moderate + plenty, to be to the grower 3s. 6d. the bushel, or eight-and-twenty + shillings the quarter. The grower’s price I understand to be the same with + what is sometimes called the contract price, or the price at which a + farmer contracts for a certain number of years to deliver a certain + quantity of corn to a dealer. As a contract of this kind saves the farmer + the expense and trouble of marketing, the contract price is generally + lower than what is supposed to be the average market price. Mr King had + judged eight-and-twenty shillings the quarter to be at that time the + ordinary contract price in years of moderate plenty. Before the scarcity + occasioned by the late extraordinary course of bad seasons, it was, I have + been assured, the ordinary contract price in all common years. + + In 1688 was granted the parliamentary bounty upon the exportation of corn. + The country gentlemen, who then composed a still greater proportion of the + legislature than they do at present, had felt that the money price of corn + was falling. The bounty was an expedient to raise it artificially to the + high price at which it had frequently been sold in the times of Charles I. + and II. It was to take place, therefore, till wheat was so high as + fortyeight shillings the quarter; that is, twenty shillings, or 5-7ths + dearer than Mr King had, in that very year, estimated the grower’s price + to be in times of moderate plenty. If his calculations deserve any part of + the reputation which they have obtained very universally, eight-and-forty + shillings the quarter was a price which, without some such expedient as + the bounty, could not at that time be expected, except in years of + extraordinary scarcity. But the government of King William was not then + fully settled. It was in no condition to refuse anything to the country + gentlemen, from whom it was, at that very time, soliciting the first + establishment of the annual land-tax. + + The value of silver, therefore, in proportion to that of corn, had + probably risen somewhat before the end of the last century; and it seems + to have continued to do so during the course of the greater part of the + present, though the necessary operation of the bounty must have hindered + that rise from being so sensible as it otherwise would have been in the + actual state of tillage. + + In plentiful years, the bounty, by occasioning an extraordinary + exportation, necessarily raises the price of corn above what it otherwise + would be in those years. To encourage tillage, by keeping up the price of + corn, even in the most plentiful years, was the avowed end of the + institution. + + In years of great scarcity, indeed, the bounty has generally been + suspended. It must, however, have had some effect upon the prices of many + of those years. By the extraordinary exportation which it occasions in + years of plenty, it must frequently hinder the plenty of one year from + compensating the scarcity of another. + + Both in years of plenty and in years of scarcity, therefore, the bounty + raises the price of corn above what it naturally would be in the actual + state of tillage. If during the sixty-four first years of the present + century, therefore, the average price has been lower than during the + sixty-four last years of the last century, it must, in the same state of + tillage, have been much more so, had it not been for this operation of the + bounty. + + But, without the bounty, it may be said the state of tillage would not + have been the same. What may have been the effects of this institution + upon the agriculture of the country, I shall endeavour to explain + hereafter, when I come to treat particularly of bounties. I shall only + observe at present, that this rise in the value of silver, in proportion + to that of corn, has not been peculiar to England. It has been observed to + have taken place in France during the same period, and nearly in the same + proportion, too, by three very faithful, diligent, and laborious + collectors of the prices of corn, Mr Dupré de St Maur, Mr Messance, and + the author of the Essay on the Police of Grain. But in France, till 1764, + the exportation of grain was by law prohibited; and it is somewhat + difficult to suppose, that nearly the same diminution of price which took + place in one country, notwithstanding this prohibition, should, in + another, be owing to the extraordinary encouragement given to exportation. + + It would be more proper, perhaps, to consider this variation in the + average money price of corn as the effect rather of some gradual rise in + the real value of silver in the European market, than of any fall in the + real average value of corn. Corn, it has already been observed, is, at + distant periods of time, a more accurate measure of value than either + silver or, perhaps, any other commodity. When, after the discovery of the + abundant mines of America, corn rose to three and four times its former + money price, this change was universally ascribed, not to any rise in the + real value of corn, but to a fall in the real value of silver. If, during + the sixty-four first years of the present century, therefore, the average + money price of corn has fallen somewhat below what it had been during the + greater part of the last century, we should, in the same manner, impute + this change, not to any fall in the real value of corn, but to some rise + in the real value of silver in the European market. + + The high price of corn during these ten or twelve years past, indeed, has + occasioned a suspicion that the real value of silver still continues to + fall in the European market. This high price of corn, however, seems + evidently to have been the effect of the extraordinary unfavourableness of + the seasons, and ought, therefore, to be regarded, not as a permanent, but + as a transitory and occasional event. The seasons, for these ten or twelve + years past, have been unfavourable through the greater part of Europe; and + the disorders of Poland have very much increased the scarcity in all those + countries, which, in dear years, used to be supplied from that market. So + long a course of bad seasons, though not a very common event, is by no + means a singular one; and whoever has inquired much into the history of + the prices of corn in former times, will be at no loss to recollect + several other examples of the same kind. Ten years of extraordinary + scarcity, besides, are not more wonderful than ten years of extraordinary + plenty. The low price of corn, from 1741 to 1750, both inclusive, may very + well be set in opposition to its high price during these last eight or ten + years. From 1741 to 1750, the average price of the quarter of nine bushels + of the best wheat, at Windsor market, it appears from the accounts of Eton + college, was only £ 1:13:9 ⅘, which is nearly 6s.3d. below the average + price of the sixty-four first years of the present century. The average + price of the quarter of eight bushels of middle wheat comes out, according + to this account, to have been, during these ten years, only £ 1:6:8. + + Between 1741 and 1750, however, the bounty must have hindered the price of + corn from falling so low in the home market as it naturally would have + done. During these ten years, the quantity of all sorts of grain exported, + it appears from the custom-house books, amounted to no less than 8,029,156 + quarters, one bushel. The bounty paid for this amounted to £ + 1,514,962:17:4 ½. In 1749, accordingly, Mr Pelham, at that time prime + minister, observed to the house of commons, that, for the three years + preceding, a very extraordinary sum had been paid as bounty for the + exportation of corn. He had good reason to make this observation, and in + the following year he might have had still better. In that single year, + the bounty paid amounted to no less than £ 324,176:10:6. {See Tracts on + the Corn Trade, Tract 3,} It is unnecessary to observe how much this + forced exportation must have raised the price of corn above what it + otherwise would have been in the home market. + + At the end of the accounts annexed to this chapter the reader will find + the particular account of those ten years separated from the rest. He will + find there, too, the particular account of the preceding ten years, of + which the average is likewise below, though not so much below, the general + average of the sixty-four first years of the century. The year 1740, + however, was a year of extraordinary scarcity. These twenty years + preceding 1750 may very well be set in opposition to the twenty preceding + 1770. As the former were a good deal below the general average of the + century, notwithstanding the intervention of one or two dear years; so the + latter have been a good deal above it, notwithstanding the intervention of + one or two cheap ones, of 1759, for example. If the former have not been + as much below the general average as the latter have been above it, we + ought probably to impute it to the bounty. The change has evidently been + too sudden to be ascribed to any change in the value of silver, which is + always slow and gradual. The suddenness of the effect can be accounted for + only by a cause which can operate suddenly, the accidental variations of + the seasons. + + The money price of labour in Great Britain has, indeed, risen during the + course of the present century. This, however, seems to be the effect, not + so much of any diminution in the value of silver in the European market, + as of an increase in the demand for labour in Great Britain, arising from + the great, and almost universal prosperity of the country. In France, a + country not altogether so prosperous, the money price of labour has, since + the middle of the last century, been observed to sink gradually with the + average money price of corn. Both in the last century and in the present, + the day wages of common labour are there said to have been pretty + uniformly about the twentieth part of the average price of the septier of + wheat; a measure which contains a little more than four Winchester + bushels. In Great Britain, the real recompence of labour, it has already + been shewn, the real quantities of the necessaries and conveniencies of + life which are given to the labourer, has increased considerably during + the course of the present century. The rise in its money price seems to + have been the effect, not of any diminution of the value of silver in the + general market of Europe, but of a rise in the real price of labour, in + the particular market of Great Britain, owing to the peculiarly happy + circumstances of the country. + + For some time after the first discovery of America, silver would continue + to sell at its former, or not much below its former price. The profits of + mining would for some time be very great, and much above their natural + rate. Those who imported that metal into Europe, however, would soon find + that the whole annual importation could not be disposed of at this high + price. Silver would gradually exchange for a smaller and a smaller + quantity of goods. Its price would sink gradually lower and lower, till it + fell to its natural price; or to what was just sufficient to pay, + according to their natural rates, the wages of the labour, the profits of + the stock, and the rent of the land, which must be paid in order to bring + it from the mine to the market. In the greater part of the silver mines of + Peru, the tax of the king of Spain, amounting to a tenth of the gross + produce, eats up, it has already been observed, the whole rent of the + land. This tax was originally a half; it soon afterwards fell to a third, + then to a fifth, and at last to a tenth, at which late it still continues. + In the greater part of the silver mines of Peru, this, it seems, is all + that remains, after replacing the stock of the undertaker of the work, + together with its ordinary profits; and it seems to be universally + acknowledged that these profits, which were once very high, are now as low + as they can well be, consistently with carrying on the works. + + The tax of the king of Spain was reduced to a fifth of the registered + silver in 1504 {Solorzano, vol, ii.}, one-and-forty years before 1545, the + date of the discovery of the mines of Potosi. In the course of ninety + years, or before 1636, these mines, the most fertile in all America, had + time sufficient to produce their full effect, or to reduce the value of + silver in the European market as low as it could well fall, while it + continued to pay this tax to the king of Spain. Ninety years is time + sufficient to reduce any commodity, of which there is no monopoly, to its + natural price, or to the lowest price at which, while it pays a particular + tax, it can continue to be sold for any considerable time together. + + The price of silver in the European market might, perhaps, have fallen + still lower, and it might have become necessary either to reduce the tax + upon it, not only to one-tenth, as in 1736, but to one twentieth, in the + same manner as that upon gold, or to give up working the greater part of + the American mines which are now wrought. The gradual increase of the + demand for silver, or the gradual enlargement of the market for the + produce of the silver mines of America, is probably the cause which has + prevented this from happening, and which has not only kept up the value of + silver in the European market, but has perhaps even raised it somewhat + higher than it was about the middle of the last century. + + Since the first discovery of America, the market for the produce of its + silver mines has been growing gradually more and more extensive. + + First, the market of Europe has become gradually more and more extensive. + Since the discovery of America, the greater part of Europe has been much + improved. England, Holland, France, and Germany; even Sweden, Denmark, and + Russia, have all advanced considerably, both in agriculture and in + manufactures. Italy seems not to have gone backwards. The fall of Italy + preceded the conquest of Peru. Since that time it seems rather to have + recovered a little. Spain and Portugal, indeed, are supposed to have gone + backwards. Portugal, however, is but a very small part of Europe, and the + declension of Spain is not, perhaps, so great as is commonly imagined. In + the beginning of the sixteenth century, Spain was a very poor country, + even in comparison with France, which has been so much improved since that + time. It was the well known remark of the emperor Charles V. who had + travelled so frequently through both countries, that every thing abounded + in France, but that every thing was wanting in Spain. The increasing + produce of the agriculture and manufactures of Europe must necessarily + have required a gradual increase in the quantity of silver coin to + circulate it; and the increasing number of wealthy individuals must have + required the like increase in the quantity of their plate and other + ornaments of silver. + + Secondly, America is itself a new market, for the produce of its own + silver mines; and as its advances in agriculture, industry, and + population, are much more rapid than those of the most thriving countries + in Europe, its demand must increase much more rapidly. The English + colonies are altogether a new market, which, partly for coin, and partly + for plate, requires a continual augmenting supply of silver through a + great continent where there never was any demand before. The greater part, + too, of the Spanish and Portuguese colonies, are altogether new markets. + New Granada, the Yucatan, Paraguay, and the Brazils, were, before + discovered by the Europeans, inhabited by savage nations, who had neither + arts nor agriculture. A considerable degree of both has now been + introduced into all of them. Even Mexico and Peru, though they cannot be + considered as altogether new markets, are certainly much more extensive + ones than they ever were before. After all the wonderful tales which have + been published concerning the splendid state of those countries in ancient + times, whoever reads, with any degree of sober judgment, the history of + their first discovery and conquest, will evidently discern that, in arts, + agriculture, and commerce, their inhabitants were much more ignorant than + the Tartars of the Ukraine are at present. Even the Peruvians, the more + civilized nation of the two, though they made use of gold and silver as + ornaments, had no coined money of any kind. Their whole commerce was + carried on by barter, and there was accordingly scarce any division of + labour among them. Those who cultivated the ground, were obliged to build + their own houses, to make their own household furniture, their own + clothes, shoes, and instruments of agriculture. The few artificers among + them are said to have been all maintained by the sovereign, the nobles, + and the priests, and were probably their servants or slaves. All the + ancient arts of Mexico and Peru have never furnished one single + manufacture to Europe. The Spanish armies, though they scarce ever + exceeded five hundred men, and frequently did not amount to half that + number, found almost everywhere great difficulty in procuring subsistence. + The famines which they are said to have occasioned almost wherever they + went, in countries, too, which at the same time are represented as very + populous and well cultivated, sufficiently demonstrate that the story of + this populousness and high cultivation is in a great measure fabulous. The + Spanish colonies are under a government in many respects less favourable + to agriculture, improvement, and population, than that of the English + colonies. They seem, however, to be advancing in all those much more + rapidly than any country in Europe. In a fertile soil and happy climate, + the great abundance and cheapness of land, a circumstance common to all + new colonies, is, it seems, so great an advantage, as to compensate many + defects in civil government. Frezier, who visited Peru in 1713, represents + Lima as containing between twenty-five and twenty-eight thousand + inhabitants. Ulloa, who resided in the same country between 1740 and 1746, + represents it as containing more than fifty thousand. The difference in + their accounts of the populousness of several other principal towns of + Chili and Peru is nearly the same; and as there seems to be no reason to + doubt of the good information of either, it marks an increase which is + scarce inferior to that of the English colonies. America, therefore, is a + new market for the produce of its own silver mines, of which the demand + must increase much more rapidly than that of the most thriving country in + Europe. + + Thirdly, the East Indies is another market for the produce of the silver + mines of America, and a market which, from the time of the first discovery + of those mines, has been continually taking off a greater and a greater + quantity of silver. Since that time, the direct trade between America and + the East Indies, which is carried on by means of the Acapulco ships, has + been continually augmenting, and the indirect intercourse by the way of + Europe has been augmenting in a still greater proportion. During the + sixteenth century, the Portuguese were the only European nation who + carried on any regular trade to the East Indies. In the last years of that + century, the Dutch began to encroach upon this monopoly, and in a few + years expelled them from their principal settlements in India. During the + greater part of the last century, those two nations divided the most + considerable part of the East India trade between them; the trade of the + Dutch continually augmenting in a still greater proportion than that of + the Portuguese declined. The English and French carried on some trade with + India in the last century, but it has been greatly augmented in the course + of the present. The East India trade of the Swedes and Danes began in the + course of the present century. Even the Muscovites now trade regularly + with China, by a sort of caravans which go over land through Siberia and + Tartary to Pekin. The East India trade of all these nations, if we except + that of the French, which the last war had well nigh annihilated, has been + almost continually augmenting. The increasing consumptions of East India + goods in Europe is, it seems, so great, as to afford a gradual increase of + employment to them all. Tea, for example, was a drug very little used in + Europe, before the middle of the last century. At present, the value of + the tea annually imported by the English East India company, for the use + of their own countrymen, amounts to more than a million and a half a year; + and even this is not enough; a great deal more being constantly smuggled + into the country from the ports of Holland, from Gottenburgh in Sweden, + and from the coast of France, too, as long as the French East India + company was in prosperity. The consumption of the porcelain of China, of + the spiceries of the Moluccas, of the piece goods of Bengal, and of + innumerable other articles, has increased very nearly in a like + proportion. The tonnage, accordingly, of all the European shipping + employed in the East India trade, at any one time during the last century, + was not, perhaps, much greater than that of the English East India company + before the late reduction of their shipping. + + But in the East Indies, particularly in China and Indostan, the value of + the precious metals, when the Europeans first began to trade to those + countries, was much higher than in Europe; and it still continues to be + so. In rice countries, which generally yield two, sometimes three crops in + the year, each of them more plentiful than any common crop of corn, the + abundance of food must be much greater than in any corn country of equal + extent. Such countries are accordingly much more populous. In them, too, + the rich, having a greater superabundance of food to dispose of beyond + what they themselves can consume, have the means of purchasing a much + greater quantity of the labour of other people. The retinue of a grandee + in China or Indostan accordingly is, by all accounts, much more numerous + and splendid than that of the richest subjects in Europe. The same + superabundance of food, of which they have the disposal, enables them to + give a greater quantity of it for all those singular and rare productions + which nature furnishes but in very small quantities; such as the precious + metals and the precious stones, the great objects of the competition of + the rich. Though the mines, therefore, which supplied the Indian market, + had been as abundant as those which supplied the European, such + commodities would naturally exchange for a greater quantity of food in + India than in Europe. But the mines which supplied the Indian market with + the precious metals seem to have been a good deal less abundant, and those + which supplied it with the precious stones a good deal more so, than the + mines which supplied the European. The precious metals, therefore, would + naturally exchange in India for a somewhat greater quantity of the + precious stones, and for a much greater quantity of food than in Europe. + The money price of diamonds, the greatest of all superfluities, would be + somewhat lower, and that of food, the first of all necessaries, a great + deal lower in the one country than in the other. But the real price of + labour, the real quantity of the necessaries of life which is given to the + labourer, it has already been observed, is lower both in China and + Indostan, the two great markets of India, than it is through the greater + part of Europe. The wages of the labourer will there purchase a smaller + quantity of food: and as the money price of food is much lower in India + than in Europe, the money price of labour is there lower upon a double + account; upon account both of the small quantity of food which it will + purchase, and of the low price of that food. But in countries of equal art + and industry, the money price of the greater part of manufactures will be + in proportion to the money price of labour; and in manufacturing art and + industry, China and Indostan, though inferior, seem not to be much + inferior to any part of Europe. The money price of the greater part of + manufactures, therefore, will naturally be much lower in those great + empires than it is anywhere in Europe. Through the greater part of Europe, + too, the expense of land-carriage increases very much both the real and + nominal price of most manufactures. It costs more labour, and therefore + more money, to bring first the materials, and afterwards the complete + manufacture to market. In China and Indostan, the extent and variety of + inland navigations save the greater part of this labour, and consequently + of this money, and thereby reduce still lower both the real and the + nominal price of the greater part of their manufactures. Upon all these + accounts, the precious metals are a commodity which it always has been, + and still continues to be, extremely advantageous to carry from Europe to + India. There is scarce any commodity which brings a better price there; or + which, in proportion to the quantity of labour and commodities which it + costs in Europe, will purchase or command a greater quantity of labour and + commodities in India. It is more advantageous, too, to carry silver + thither than gold; because in China, and the greater part of the other + markets of India, the proportion between fine silver and fine gold is but + as ten, or at most as twelve to one; whereas in Europe it is as fourteen + or fifteen to one. In China, and the greater part of the other markets of + India, ten, or at most twelve ounces of silver, will purchase an ounce of + gold; in Europe, it requires from fourteen to fifteen ounces. In the + cargoes, therefore, of the greater part of European ships which sail to + India, silver has generally been one of the most valuable articles. It is + the most valuable article in the Acapulco ships which sail to Manilla. The + silver of the new continent seems, in this manner, to be one of the + principal commodities by which the commerce between the two extremities of + the old one is carried on; and it is by means of it, in a great measure, + that those distant parts of the world are connected with one another. + + In order to supply so very widely extended a market, the quantity of + silver annually brought from the mines must not only be sufficient to + support that continued increase, both of coin and of plate, which is + required in all thriving countries; but to repair that continual waste and + consumption of silver which takes place in all countries where that metal + is used. + + The continual consumption of the precious metals in coin by wearing, and + in plate both by wearing and cleaning, is very sensible; and in + commodities of which the use is so very widely extended, would alone + require a very great annual supply. The consumption of those metals in + some particular manufactures, though it may not perhaps be greater upon + the whole than this gradual consumption, is, however, much more sensible, + as it is much more rapid. In the manufactures of Birmingham alone, the + quantity of gold and silver annually employed in gilding and plating, and + thereby disqualified from ever afterwards appearing in the shape of those + metals, is said to amount to more than fifty thousand pounds sterling. We + may from thence form some notion how great must be the annual consumption + in all the different parts of the world, either in manufactures of the + same kind with those of Birmingham, or in laces, embroideries, gold and + silver stuffs, the gilding of books, furniture, etc. A considerable + quantity, too, must be annually lost in transporting those metals from one + place to another both by sea and by land. In the greater part of the + governments of Asia, besides, the almost universal custom of concealing + treasures in the bowels of the earth, of which the knowledge frequently + dies with the person who makes the concealment, must occasion the loss of + a still greater quantity. + + The quantity of gold and silver imported at both Cadiz and Lisbon + (including not only what comes under register, but what may be supposed to + be smuggled) amounts, according to the best accounts, to about six + millions sterling a-year. + + According to Mr Meggens {Postscript to the Universal Merchant p. 15 and + 16. This postscript was not printed till 1756, three years after the + publication of the book, which has never had a second edition. The + postscript is, therefore, to be found in few copies; it corrects several + errors in the book.}, the annual importation of the precious metals into + Spain, at an average of six years, viz. from 1748 to 1753, both inclusive, + and into Portugal, at an average of seven years, viz. from 1747 to 1753, + both inclusive, amounted in silver to 1,101,107 pounds weight, and in gold + to 49,940 pounds weight. The silver, at sixty two shillings the pound + troy, amounts to £ 3,413,431:10s. sterling. The gold, at forty-four + guineas and a half the pound troy, amounts to £ 2,333,446:14s. sterling. + Both together amount to £ 5,746,878:4s. sterling. The account of what was + imported under register, he assures us, is exact. He gives us the detail + of the particular places from which the gold and silver were brought, and + of the particular quantity of each metal, which, according to the + register, each of them afforded. He makes an allowance, too, for the + quantity of each metal which, he supposes, may have been smuggled. The + great experience of this judicious merchant renders his opinion of + considerable weight. + + According to the eloquent, and sometimes well-informed, author of the + Philosophical and Political History of the Establishment of the Europeans + in the two Indies, the annual importation of registered gold and silver + into Spain, at an average of eleven years, viz. from 1754 to 1764, both + inclusive, amounted to 13,984,185 ⅗ piastres of ten reals. On account of + what may have been smuggled, however, the whole annual importation, he + supposes, may have amounted to seventeen millions of piastres, which, at + 4s. 6d. the piastre, is equal to £ 3,825,000 sterling. He gives the + detail, too, of the particular places from which the gold and silver were + brought, and of the particular quantities of each metal, which according + to the register, each of them afforded. He informs us, too, that if we + were to judge of the quantity of gold annually imported from the Brazils + to Lisbon, by the amount of the tax paid to the king of Portugal, which it + seems, is one-fifth of the standard metal, we might value it at eighteen + millions of cruzadoes, or forty-five millions of French livres, equal to + about twenty millions sterling. On account of what may have been smuggled, + however, we may safely, he says, add to this sum an eighth more, or £ + 250,000 sterling, so that the whole will amount to £ 2,250,000 sterling. + According to this account, therefore, the whole annual importation of the + precious metals into both Spain and Portugal, mounts to about £ 6,075,000 + sterling. + + Several other very well authenticated, though manuscript accounts, I have + been assured, agree in making this whole annual importation amount, at an + average, to about six millions sterling; sometimes a little more, + sometimes a little less. + + The annual importation of the precious metals into Cadiz and Lisbon, + indeed, is not equal to the whole annual produce of the mines of America. + Some part is sent annually by the Acapulco ships to Manilla; some part is + employed in a contraband trade, which the Spanish colonies carry on with + those of other European nations; and some part, no doubt, remains in the + country. The mines of America, besides, are by no means the only gold and + silver mines in the world. They, are, however, by far the most abundant. + The produce of all the other mines which are known is insignificant, it is + acknowledged, in comparison with theirs; and the far greater part of + their produce, it is likewise acknowledged, is annually imported into + Cadiz and Lisbon. But the consumption of Birmingham alone, at the rate of + fifty thousand pounds a-year, is equal to the hundred-and-twentieth part + of this annual importation, at the rate of six millions a-year. The whole + annual consumption of gold and silver, therefore, in all the different + countries of the world where those metals are used, may, perhaps, be + nearly equal to the whole annual produce. The remainder may be no more + than sufficient to supply the increasing demand of all thriving countries. + It may even have fallen so far short of this demand, as somewhat to raise + the price of those metals in the European market. + + The quantity of brass and iron annually brought from the mine to the + market, is out of all proportion greater than that of gold and silver. We + do not, however, upon this account, imagine that those coarse metals are + likely to multiply beyond the demand, or to become gradually cheaper and + cheaper. Why should we imagine that the precious metals are likely to do + so? The coarse metals, indeed, though harder, are put to much harder uses, + and, as they are of less value, less care is employed in their + preservation. The precious metals, however, are not necessarily immortal + any more than they, but are liable, too, to be lost, wasted, and consumed, + in a great variety of ways. + + The price of all metals, though liable to slow and gradual variations, + varies less from year to year than that of almost any other part of the + rude produce of land: and the price of the precious metals is even less + liable to sudden variations than that of the coarse ones. The durableness + of metals is the foundation of this extraordinary steadiness of price. The + corn which was brought to market last year will be all, or almost all, + consumed, long before the end of this year. But some part of the iron + which was brought from the mine two or three hundred years ago, may be + still in use, and, perhaps, some part of the gold which was brought from + it two or three thousand years ago. The different masses of corn, which, + in different years, must supply the consumption of the world, will always + be nearly in proportion to the respective produce of those different + years. But the proportion between the different masses of iron which may + be in use in two different years, will be very little affected by any + accidental difference in the produce of the iron mines of those two years; + and the proportion between the masses of gold will be still less affected + by any such difference in the produce of the gold mines. Though the + produce of the greater part of metallic mines, therefore, varies, perhaps, + still more from year to year than that of the greater part of corn fields, + those variations have not the same effect upon the price of the one + species of commodities as upon that of the other. + + _Variations in the Proportion between the respective Values of Gold and + Silver._ + + + + + Before the discovery of the mines of America, the value of fine gold to + fine silver was regulated in the different mines of Europe, between the + proportions of one to ten and one to twelve; that is, an ounce of fine + gold was supposed to be worth from ten to twelve ounces of fine silver. + About the middle of the last century, it came to be regulated, between the + proportions of one to fourteen and one to fifteen; that is, an ounce of + fine gold came to be supposed worth between fourteen and fifteen ounces of + fine silver. Gold rose in its nominal value, or in the quantity of silver + which was given for it. Both metals sunk in their real value, or in the + quantity of labour which they could purchase; but silver sunk more than + gold. Though both the gold and silver mines of America exceeded in + fertility all those which had ever been known before, the fertility of the + silver mines had, it seems, been proportionally still greater than that of + the gold ones. + + The great quantities of silver carried annually from Europe to India, + have, in some of the English settlements, gradually reduced the value of + that metal in proportion to gold. In the mint of Calcutta, an ounce of + fine gold is supposed to be worth fifteen ounces of fine silver, in the + same manner as in Europe. It is in the mint, perhaps, rated too high for + the value which it bears in the market of Bengal. In China, the proportion + of gold to silver still continues as one to ten, or one to twelve. In + Japan, it is said to be as one to eight. + + The proportion between the quantities of gold and silver annually imported + into Europe, according to Mr Meggens’ account, is as one to twenty-two + nearly; that is, for one ounce of gold there are imported a little more + than twenty-two ounces of silver. The great quantity of silver sent + annually to the East Indies reduces, he supposes, the quantities of those + metals which remain in Europe to the proportion of one to fourteen or + fifteen, the proportion of their values. The proportion between their + values, he seems to think, must necessarily be the same as that between + their quantities, and would therefore be as one to twenty-two, were it not + for this greater exportation of silver. + + But the ordinary proportion between the respective values of two + commodities is not necessarily the same as that between the quantities of + them which are commonly in the market. The price of an ox, reckoned at ten + guineas, is about three score times the price of a lamb, reckoned at 3s. + 6d. It would be absurd, however, to infer from thence, that there are + commonly in the market three score lambs for one ox; and it would be just + as absurd to infer, because an ounce of gold will commonly purchase from + fourteen or fifteen ounces of silver, that there are commonly in the + market only fourteen or fifteen ounces of silver for one ounce of gold. + + The quantity of silver commonly in the market, it is probable, is much + greater in proportion to that of gold, than the value of a certain + quantity of gold is to that of an equal quantity of silver. The whole + quantity of a cheap commodity brought to market is commonly not only + greater, but of greater value, than the whole quantity of a dear one. The + whole quantity of bread annually brought to market, is not only greater, + but of greater value, than the whole quantity of butcher’s meat; the whole + quantity of butcher’s meat, than the whole quantity of poultry; and the + whole quantity of poultry, than the whole quantity of wild fowl. There are + so many more purchasers for the cheap than for the dear commodity, that, + not only a greater quantity of it, but a greater value can commonly be + disposed of. The whole quantity, therefore, of the cheap commodity, must + commonly be greater in proportion to the whole quantity of the dear one, + than the value of a certain quantity of the dear one, is to the value of + an equal quantity of the cheap one. When we compare the precious metals + with one another, silver is a cheap, and gold a dear commodity. We ought + naturally to expect, therefore, that there should always be in the market, + not only a greater quantity, but a greater value of silver than of gold. + Let any man, who has a little of both, compare his own silver with his + gold plate, and he will probably find, that not only the quantity, but the + value of the former, greatly exceeds that of the latter. Many people, + besides, have a good deal of silver who have no gold plate, which, even + with those who have it, is generally confined to watch-cases, snuff-boxes, + and such like trinkets, of which the whole amount is seldom of great + value. In the British coin, indeed, the value of the gold preponderates + greatly, but it is not so in that of all countries. In the coin of some + countries, the value of the two metals is nearly equal. In the Scotch + coin, before the union with England, the gold preponderated very little, + though it did somewhat {See Ruddiman’s Preface to Anderson’s Diplomata, + etc. Scotiae.}, as it appears by the accounts of the mint. In the coin of + many countries the silver preponderates. In France, the largest sums are + commonly paid in that metal, and it is there difficult to get more gold + than what is necessary to carry about in your pocket. The superior value, + however, of the silver plate above that of the gold, which takes place in + all countries, will much more than compensate the preponderancy of the + gold coin above the silver, which takes place only in some countries. + + Though, in one sense of the word, silver always has been, and probably + always will be, much cheaper than gold; yet, in another sense, gold may + perhaps, in the present state of the Spanish market, be said to be + somewhat cheaper than silver. A commodity may be said to be dear or cheap + not only according to the absolute greatness or smallness of its usual + price, but according as that price is more or less above the lowest for + which it is possible to bring it to market for any considerable time + together. This lowest price is that which barely replaces, with a moderate + profit, the stock which must be employed in bringing the commodity + thither. It is the price which affords nothing to the landlord, of which + rent makes not any component part, but which resolves itself altogether + into wages and profit. But, in the present state of the Spanish market, + gold is certainly somewhat nearer to this lowest price than silver. The + tax of the king of Spain upon gold is only one-twentieth part of the + standard metal, or five per cent.; whereas his tax upon silver amounts to + one-tenth part of it, or to ten per cent. In these taxes, too, it has + already been observed, consists the whole rent of the greater part of the + gold and silver mines of Spanish America; and that upon gold is still + worse paid than that upon silver. The profits of the undertakers of gold + mines, too, as they more rarely make a fortune, must, in general, be still + more moderate than those of the undertakers of silver mines. The price of + Spanish gold, therefore, as it affords both less rent and less profit, + must, in the Spanish market, be somewhat nearer to the lowest price for + which it is possible to bring it thither, than the price of Spanish + silver. When all expenses are computed, the whole quantity of the one + metal, it would seem, cannot, in the Spanish market, be disposed of so + advantageously as the whole quantity of the other. The tax, indeed, of the + king of Portugal upon the gold of the Brazils, is the same with the + ancient tax of the king of Spain upon the silver of Mexico and Peru; or + one-fifth part of the standard metal. It may therefore be uncertain, + whether, to the general market of Europe, the whole mass of American gold + comes at a price nearer to the lowest for which it is possible to bring it + thither, than the whole mass of American silver. + + The price of diamonds and other precious stones may, perhaps, be still + nearer to the lowest price at which it is possible to bring them to + market, than even the price of gold. + + Though it is not very probable that any part of a tax, which is not only + imposed upon one of the most proper subjects of taxation, a mere luxury + and superfluity, but which affords so very important a revenue as the tax + upon silver, will ever be given up as long as it is possible to pay it; + yet the same impossibility of paying it, which, in 1736. made it necessary + to reduce it from one-fifth to one-tenth, may in time make it necessary to + reduce it still further; in the same manner as it made it necessary to + reduce the tax upon gold to one-twentieth. That the silver mines of + Spanish America, like all other mines, become gradually more expensive in + the working, on account of the greater depths at which it is necessary to + carry on the works, and of the greater expense of drawing out the water, + and of supplying them with fresh air at those depths, is acknowledged by + everybody who has inquired into the state of those mines. + + These causes, which are equivalent to a growing scarcity of silver (for a + commodity may be said to grow scarcer when it becomes more difficult and + expensive to collect a certain quantity of it), must, in time, produce one + or other of the three following events: The increase of the expense must + either, first, be compensated altogether by a proportionable increase in + the price of the metal; or, secondly, it must be compensated altogether by + a proportionable diminution of the tax upon silver; or, thirdly, it must + be compensated partly by the one and partly by the other of those two + expedients. This third event is very possible. As gold rose in its price + in proportion to silver, notwithstanding a great diminution of the tax + upon gold, so silver might rise in its price in proportion to labour and + commodities, notwithstanding an equal diminution of the tax upon silver. + + Such successive reductions of the tax, however, though they may not + prevent altogether, must certainly retard, more or less, the rise of the + value of silver in the European market. In consequence of such reductions, + many mines may be wrought which could not be wrought before, because they + could not afford to pay the old tax; and the quantity of silver annually + brought to market, must always be somewhat greater, and, therefore, the + value of any given quantity somewhat less, than it otherwise would have + been. In consequence of the reduction in 1736, the value of silver in the + European market, though it may not at this day be lower than before that + reduction, is, probably, at least ten per cent. lower than it would have + been, had the court of Spain continued to exact the old tax. That, + notwithstanding this reduction, the value of silver has, during the course + of the present century, begun to rise somewhat in the European market, the + facts and arguments which have been alleged above, dispose me to believe, + or more properly to suspect and conjecture; for the best opinion which I + can form upon this subject, scarce, perhaps, deserves the name of belief. + The rise, indeed, supposing there has been any, has hitherto been so very + small, that after all that has been said, it may, perhaps, appear to many + people uncertain, not only whether this event has actually taken place, + but whether the contrary may not have taken place, or whether the value of + silver may not still continue to fall in the European market. + + It must be observed, however, that whatever may be the supposed annual + importation of gold and silver, there must be a certain period at which + the annual consumption of those metals will be equal to that annual + importation. Their consumption must increase as their mass increases, or + rather in a much greater proportion. As their mass increases, their value + diminishes. They are more used, and less cared for, and their consumption + consequently increases in a greater proportion than their mass. After a + certain period, therefore, the annual consumption of those metals must, in + this manner, become equal to their annual importation, provided that + importation is not continually increasing; which, in the present times, is + not supposed to be the case. + + If, when the annual consumption has become equal to the annual + importation, the annual importation should gradually diminish, the annual + consumption may, for some time, exceed the annual importation. The mass of + those metals may gradually and insensibly diminish, and their value + gradually and insensibly rise, till the annual importation becoming again + stationary, the annual consumption will gradually and insensibly + accommodate itself to what that annual importation can maintain. + + + _Grounds of the suspicion that the Value of Silver still continues to + decrease._ + + + The increase of the wealth of Europe, and the popular notion, that as the + quantity of the precious metals naturally increases with the increase of + wealth, so their value diminishes as their quantity increases, may, + perhaps, dispose many people to believe that their value still continues + to fall in the European market; and the still gradually increasing price + of many parts of the rude produce of land may confirm them still farther + in this opinion. + + That that increase in the quantity of the precious metals, which arises in + any country from the increase of wealth, has no tendency to diminish their + value, I have endeavoured to shew already. Gold and silver naturally + resort to a rich country, for the same reason that all sorts of luxuries + and curiosities resort to it; not because they are cheaper there than in + poorer countries, but because they are dearer, or because a better price + is given for them. It is the superiority of price which attracts them; and + as soon as that superiority ceases, they necessarily cease to go thither. + + If you except corn, and such other vegetables as are raised altogether by + human industry, that all other sorts of rude produce, cattle, poultry, + game of all kinds, the useful fossils and minerals of the earth, etc. + naturally grow dearer, as the society advances in wealth and improvement, + I have endeavoured to shew already. Though such commodities, therefore, + come to exchange for a greater quantity of silver than before, it will not + from thence follow that silver has become really cheaper, or will purchase + less labour than before; but that such commodities have become really + dearer, or will purchase more labour than before. It is not their nominal + price only, but their real price, which rises in the progress of + improvement. The rise of their nominal price is the effect, not of any + degradation of the value of silver, but of the rise in their real price. + + + _Different Effects of the Progress of Improvement upon three different + sorts of rude Produce._ + + + These different sorts of rude produce may be divided into three classes. + The first comprehends those which it is scarce in the power of human + industry to multiply at all. The second, those which it can multiply in + proportion to the demand. The third, those in which the efficacy of + industry is either limited or uncertain. In the progress of wealth and + improvement, the real price of the first may rise to any degree of + extravagance, and seems not to be limited by any certain boundary. That of + the second, though it may rise greatly, has, however, a certain boundary, + beyond which it cannot well pass for any considerable time together. That + of the third, though its natural tendency is to rise in the progress of + improvement, yet in the same degree of improvement it may sometimes happen + even to fall, sometimes to continue the same, and sometimes to rise more + or less, according as different accidents render the efforts of human + industry, in multiplying this sort of rude produce, more or less + successful. + + First Sort.—The first sort of rude produce, of which the price rises + in the progress of improvement, is that which it is scarce in the power of + human industry to multiply at all. It consists in those things which + nature produces only in certain quantities, and which being of a very + perishable nature, it is impossible to accumulate together the produce of + many different seasons. Such are the greater part of rare and singular + birds and fishes, many different sorts of game, almost all wild-fowl, all + birds of passage in particular, as well as many other things. When wealth, + and the luxury which accompanies it, increase, the demand for these is + likely to increase with them, and no effort of human industry may be able + to increase the supply much beyond what it was before this increase of the + demand. The quantity of such commodities, therefore, remaining the same, + or nearly the same, while the competition to purchase them is continually + increasing, their price may rise to any degree of extravagance, and seems + not to be limited by any certain boundary. If woodcocks should become so + fashionable as to sell for twenty guineas a-piece, no effort of human + industry could increase the number of those brought to market, much beyond + what it is at present. The high price paid by the Romans, in the time of + their greatest grandeur, for rare birds and fishes, may in this manner + easily be accounted for. These prices were not the effects of the low + value of silver in those times, but of the high value of such rarities and + curiosities as human industry could not multiply at pleasure. The real + value of silver was higher at Rome, for sometime before, and after the + fall of the republic, than it is through the greater part of Europe at + present. Three sestertii equal to about sixpence sterling, was the price + which the republic paid for the modius or peck of the tithe wheat of + Sicily. This price, however, was probably below the average market price, + the obligation to deliver their wheat at this rate being considered as a + tax upon the Sicilian farmers. When the Romans, therefore, had occasion to + order more corn than the tithe of wheat amounted to, they were bound by + capitulation to pay for the surplus at the rate of four sestertii, or + eightpence sterling the peck; and this had probably been reckoned the + moderate and reasonable, that is, the ordinary or average contract price + of those times; it is equal to about one-and-twenty shillings the quarter. + Eight-and-twenty shillings the quarter was, before the late years of + scarcity, the ordinary contract price of English wheat, which in quality + is inferior to the Sicilian, and generally sells for a lower price in the + European market. The value of silver, therefore, in those ancient times, + must have been to its value in the present, as three to four inversely; + that is, three ounces of silver would then have purchased the same + quantity of labour and commodities which four ounces will do at present. + When we read in Pliny, therefore, that Seius {Lib. X, c. 29.} bought a + white nightingale, as a present for the empress Agrippina, at the price of + six thousand sestertii, equal to about fifty pounds of our present money; + and that Asinius Celer {Lib. IX, c. 17.} purchased a surmullet at the + price of eight thousand sestertii, equal to about sixty-six pounds + thirteen shillings and fourpence of our present money; the extravagance of + those prices, how much soever it may surprise us, is apt, notwithstanding, + to appear to us about one third less than it really was. Their real price, + the quantity of labour and subsistence which was given away for them, was + about one-third more than their nominal price is apt to express to us in + the present times. Seius gave for the nightingale the command of a + quantity of labour and subsistence, equal to what £ 66:13: 4d. would + purchase in the present times; and Asinius Celer gave for a surmullet the + command of a quantity equal to what £ 88:17: 9d. would purchase. What + occasioned the extravagance of those high prices was, not so much the + abundance of silver, as the abundance of labour and subsistence, of which + those Romans had the disposal, beyond what was necessary for their own + use. The quantity of silver, of which they had the disposal, was a good + deal less than what the command of the same quantity of labour and + subsistence would have procured to them in the present times. + + Second sort.—The second sort of rude produce, of which the price + rises in the progress of improvement, is that which human industry can + multiply in proportion to the demand. It consists in those useful plants + and animals, which, in uncultivated countries, nature produces with such + profuse abundance, that they are of little or no value, and which, as + cultivation advances, are therefore forced to give place to some more + profitable produce. During a long period in the progress of improvement, + the quantity of these is continually diminishing, while, at the same time, + the demand for them is continually increasing. Their real value, + therefore, the real quantity of labour which they will purchase or + command, gradually rises, till at last it gets so high as to render them + as profitable a produce as any thing else which human industry can raise + upon the most fertile and best cultivated land. When it has got so high, + it cannot well go higher. If it did, more land and more industry would + soon be employed to increase their quantity. + + When the price of cattle, for example, rises so high, that it is as + profitable to cultivate land in order to raise food for them as in order + to raise food for man, it cannot well go higher. If it did, more corn land + would soon be turned into pasture. The extension of tillage, by + diminishing the quantity of wild pasture, diminishes the quantity of + butcher’s meat, which the country naturally produces without labour or + cultivation; and, by increasing the number of those who have either corn, + or, what comes to the same thing, the price of corn, to give in exchange + for it, increases the demand. The price of butcher’s meat, therefore, and, + consequently, of cattle, must gradually rise, till it gets so high, that + it becomes as profitable to employ the most fertile and best cultivated + lands in raising food for them as in raising corn. But it must always be + late in the progress of improvement before tillage can be so far extended + as to raise the price of cattle to this height; and, till it has got to + this height, if the country is advancing at all, their price must be + continually rising. There are, perhaps, some parts of Europe in which the + price of cattle has not yet got to this height. It had not got to this + height in any part of Scotland before the Union. Had the Scotch cattle + been always confined to the market of Scotland, in a country in which the + quantity of land, which can be applied to no other purpose but the feeding + of cattle, is so great in proportion to what can be applied to other + purposes, it is scarce possible, perhaps, that their price could ever have + risen so high as to render it profitable to cultivate land for the sake of + feeding them. In England, the price of cattle, it has already been + observed, seems, in the neighbourhood of London, to have got to this + height about the beginning of the last century; but it was much later, + probably, before it got through the greater part of the remoter counties, + in some of which, perhaps, it may scarce yet have got to it. Of all the + different substances, however, which compose this second sort of rude + produce, cattle is, perhaps, that of which the price, in the progress of + improvement, rises first to this height. + + Till the price of cattle, indeed, has got to this height, it seems scarce + possible that the greater part, even of those lands which are capable of + the highest cultivation, can be completely cultivated. In all farms too + distant from any town to carry manure from it, that is, in the far greater + part of those of every extensive country, the quantity of well cultivated + land must be in proportion to the quantity of manure which the farm itself + produces; and this, again, must be in proportion to the stock of cattle + which are maintained upon it. The land is manured, either by pasturing the + cattle upon it, or by feeding them in the stable, and from thence carrying + out their dung to it. But unless the price of the cattle be sufficient to + pay both the rent and profit of cultivated land, the farmer cannot afford + to pasture them upon it; and he can still less afford to feed them in the + stable. It is with the produce of improved and cultivated land only that + cattle can be fed in the stable; because, to collect the scanty and + scattered produce of waste and unimproved lands, would require too much + labour, and be too expensive. If the price of the cattle, therefore, is + not sufficient to pay for the produce of improved and cultivated land, + when they are allowed to pasture it, that price will be still less + sufficient to pay for that produce, when it must be collected with a good + deal of additional labour, and brought into the stable to them. In these + circumstances, therefore, no more cattle can with profit be fed in the + stable than what are necessary for tillage. But these can never afford + manure enough for keeping constantly in good condition all the lands which + they are capable of cultivating. What they afford, being insufficient for + the whole farm, will naturally be reserved for the lands to which it can + be most advantageously or conveniently applied; the most fertile, or + those, perhaps, in the neighbourhood of the farm-yard. These, therefore, + will be kept constantly in good condition, and fit for tillage. The rest + will, the greater part of them, be allowed to lie waste, producing scarce + any thing but some miserable pasture, just sufficient to keep alive a few + straggling, half-starved cattle; the farm, though much overstocked in + proportion to what would be necessary for its complete cultivation, being + very frequently overstocked in proportion to its actual produce. A portion + of this waste land, however, after having been pastured in this wretched + manner for six or seven years together, may be ploughed up, when it will + yield, perhaps, a poor crop or two of bad oats, or of some other coarse + grain; and then, being entirely exhausted, it must be rested and pastured + again as before, and another portion ploughed up, to be in the same manner + exhausted and rested again in its turn. Such, accordingly, was the general + system of management all over the low country of Scotland before the + Union. The lands which were kept constantly well manured and in good + condition seldom exceeded a third or fourth part of the whole farm, and + sometimes did not amount to a fifth or a sixth part of it. The rest were + never manured, but a certain portion of them was in its turn, + notwithstanding, regularly cultivated and exhausted. Under this system of + management, it is evident, even that part of the lands of Scotland which + is capable of good cultivation, could produce but little in comparison of + what it may be capable of producing. But how disadvantageous soever this + system may appear, yet, before the Union, the low price of cattle seems to + have rendered it almost unavoidable. If, notwithstanding a great rise in + the price, it still continues to prevail through a considerable part of + the country, it is owing in many places, no doubt, to ignorance and + attachment to old customs, but, in most places, to the unavoidable + obstructions which the natural course of things opposes to the immediate + or speedy establishment of a better system: first, to the poverty of the + tenants, to their not having yet had time to acquire a stock of cattle + sufficient to cultivate their lands more completely, the same rise of + price, which would render it advantageous for them to maintain a greater + stock, rendering it more difficult for them to acquire it; and, secondly, + to their not having yet had time to put their lands in condition to + maintain this greater stock properly, supposing they were capable of + acquiring it. The increase of stock and the improvement of land are two + events which must go hand in hand, and of which the one can nowhere much + outrun the other. Without some increase of stock, there can be scarce any + improvement of land, but there can be no considerable increase of stock, + but in consequence of a considerable improvement of land; because + otherwise the land could not maintain it. These natural obstructions to + the establishment of a better system, cannot be removed but by a long + course of frugality and industry; and half a century or a century more, + perhaps, must pass away before the old system, which is wearing out + gradually, can be completely abolished through all the different parts of + the country. Of all the commercial advantages, however, which Scotland has + derived from the Union with England, this rise in the price of cattle is, + perhaps, the greatest. It has not only raised the value of all highland + estates, but it has, perhaps, been the principal cause of the improvement + of the low country. + + In all new colonies, the great quantity of waste land, which can for many + years be applied to no other purpose but the feeding of cattle, soon + renders them extremely abundant; and in every thing great cheapness is the + necessary consequence of great abundance. Though all the cattle of the + European colonies in America were originally carried from Europe, they + soon multiplied so much there, and became of so little value, that even + horses were allowed to run wild in the woods, without any owner thinking + it worth while to claim them. It must be a long time after the first + establishment of such colonies, before it can become profitable to feed + cattle upon the produce of cultivated land. The same causes, therefore, + the want of manure, and the disproportion between the stock employed in + cultivation and the land which it is destined to cultivate, are likely to + introduce there a system of husbandry, not unlike that which still + continues to take place in so many parts of Scotland. Mr Kalm, the Swedish + traveller, when he gives an account of the husbandry of some of the + English colonies in North America, as he found it in 1749, observes, + accordingly, that he can with difficulty discover there the character of + the English nation, so well skilled in all the different branches of + agriculture. They make scarce any manure for their corn fields, he says; + but when one piece of ground has been exhausted by continual cropping, + they clear and cultivate another piece of fresh land; and when that is + exhausted, proceed to a third. Their cattle are allowed to wander through + the woods and other uncultivated grounds, where they are half-starved; + having long ago extirpated almost all the annual grasses, by cropping them + too early in the spring, before they had time to form their flowers, or to + shed their seeds. {Kalm’s Travels, vol 1, pp. 343, 344.} The annual + grasses were, it seems, the best natural grasses in that part of North + America; and when the Europeans first settled there, they used to grow + very thick, and to rise three or four feet high. A piece of ground which, + when he wrote, could not maintain one cow, would in former times, he was + assured, have maintained four, each of which would have given four times + the quantity of milk which that one was capable of giving. The poorness of + the pasture had, in his opinion, occasioned the degradation of their + cattle, which degenerated sensibly from one generation to another. They + were probably not unlike that stunted breed which was common all over + Scotland thirty or forty years ago, and which is now so much mended + through the greater part of the low country, not so much by a change of + the breed, though that expedient has been employed in some places, as by a + more plentiful method of feeding them. + + Though it is late, therefore, in the progress of improvement, before + cattle can bring such a price as to render it profitable to cultivate land + for the sake of feeding them; yet of all the different parts which compose + this second sort of rude produce, they are perhaps the first which bring + this price; because, till they bring it, it seems impossible that + improvement can be brought near even to that degree of perfection to which + it has arrived in many parts of Europe. + + As cattle are among the first, so perhaps venison is among the last parts + of this sort of rude produce which bring this price. The price of venison + in Great Britain, how extravagant soever it may appear, is not near + sufficient to compensate the expense of a deer park, as is well known to + all those who have had any experience in the feeding of deer. If it was + otherwise, the feeding of deer would soon become an article of common + farming, in the same manner as the feeding of those small birds, called + turdi, was among the ancient Romans. Varro and Columella assure us, that + it was a most profitable article. The fattening of ortolans, birds of + passage which arrive lean in the country, is said to be so in some parts + of France. If venison continues in fashion, and the wealth and luxury of + Great Britain increase as they have done for some time past, its price may + very probably rise still higher than it is at present. + + Between that period in the progress of improvement, which brings to its + height the price of so necessary an article as cattle, and that which + brings to it the price of such a superfluity as venison, there is a very + long interval, in the course of which many other sorts of rude produce + gradually arrive at their highest price, some sooner and some later, + according to different circumstances. + + Thus, in every farm, the offals of the barn and stable will maintain a + certain number of poultry. These, as they are fed with what would + otherwise be lost, are a mere save-all; and as they cost the farmer scarce + any thing, so he can afford to sell them for very little. Almost all that + he gets is pure gain, and their price can scarce be so low as to + discourage him from feeding this number. But in countries ill cultivated, + and therefore but thinly inhabited, the poultry, which are thus raised + without expense, are often fully sufficient to supply the whole demand. In + this state of things, therefore, they are often as cheap as butcher’s + meat, or any other sort of animal food. But the whole quantity of poultry + which the farm in this manner produces without expense, must always be + much smaller than the whole quantity of butcher’s meat which is reared + upon it; and in times of wealth and luxury, what is rare, with only nearly + equal merit, is always preferred to what is common. As wealth and luxury + increase, therefore, in consequence of improvement and cultivation, the + price of poultry gradually rises above that of butcher’s meat, till at + last it gets so high, that it becomes profitable to cultivate land for the + sake of feeding them. When it has got to this height, it cannot well go + higher. If it did, more land would soon be turned to this purpose. In + several provinces of France, the feeding of poultry is considered as a + very important article in rural economy, and sufficiently profitable to + encourage the farmer to raise a considerable quantity of Indian corn and + buckwheat for this purpose. A middling farmer will there sometimes have + four hundred fowls in his yard. The feeding of poultry seems scarce yet to + be generally considered as a matter of so much importance in England. They + are certainly, however, dearer in England than in France, as England + receives considerable supplies from France. In the progress of + improvements, the period at which every particular sort of animal food is + dearest, must naturally be that which immediately precedes the general + practice of cultivating land for the sake of raising it. For some time + before this practice becomes general, the scarcity must necessarily raise + the price. After it has become general, new methods of feeding are + commonly fallen upon, which enable the farmer to raise upon the same + quantity of ground a much greater quantity of that particular sort of + animal food. The plenty not only obliges him to sell cheaper, but, in + consequence of these improvements, he can afford to sell cheaper; for if + he could not afford it, the plenty would not be of long continuance. It + has been probably in this manner that the introduction of clover, turnips, + carrots, cabbages, etc. has contributed to sink the common price of + butcher’s meat in the London market, somewhat below what it was about the + beginning of the last century. + + The hog, that finds his food among ordure, and greedily devours many + things rejected by every other useful animal, is, like poultry, originally + kept as a save-all. As long as the number of such animals, which can thus + be reared at little or no expense, is fully sufficient to supply the + demand, this sort of butcher’s meat comes to market at a much lower price + than any other. But when the demand rises beyond what this quantity can + supply, when it becomes necessary to raise food on purpose for feeding and + fattening hogs, in the same manner as for feeding and fattening other + cattle, the price necessarily rises, and becomes proportionably either + higher or lower than that of other butcher’s meat, according as the nature + of the country, and the state of its agriculture, happen to render the + feeding of hogs more or less expensive than that of other cattle. In + France, according to Mr Buffon, the price of pork is nearly equal to that + of beef. In most parts of Great Britain it is at present somewhat higher. + + The great rise in the price both of hogs and poultry, has, in Great + Britain, been frequently imputed to the diminution of the number of + cottagers and other small occupiers of land; an event which has in every + part of Europe been the immediate forerunner of improvement and better + cultivation, but which at the same time may have contributed to raise the + price of those articles, both somewhat sooner and somewhat faster than it + would otherwise have risen. As the poorest family can often maintain a cat + or a dog without any expense, so the poorest occupiers of land can + commonly maintain a few poultry, or a sow and a few pigs, at very little. + The little offals of their own table, their whey, skimmed milk, and butter + milk, supply those animals with a part of their food, and they find the + rest in the neighbouring fields, without doing any sensible damage to any + body. By diminishing the number of those small occupiers, therefore, the + quantity of this sort of provisions, which is thus produced at little or + no expense, must certainly have been a good deal diminished, and their + price must consequently have been raised both sooner and faster than it + would otherwise have risen. Sooner or later, however, in the progress of + improvement, it must at any rate have risen to the utmost height to which + it is capable of rising; or to the price which pays the labour and expense + of cultivating the land which furnishes them with food, as well as these + are paid upon the greater part of other cultivated land. + + The business of the dairy, like the feeding of hogs and poultry, is + originally carried on as a save-all. The cattle necessarily kept upon the + farm produce more milk than either the rearing of their own young, or the + consumption of the farmer’s family requires; and they produce most at one + particular season. But of all the productions of land, milk is perhaps the + most perishable. In the warm season, when it is most abundant, it will + scarce keep four-and-twenty hours. The farmer, by making it into fresh + butter, stores a small part of it for a week; by making it into salt + butter, for a year; and by making it into cheese, he stores a much greater + part of it for several years. Part of all these is reserved for the use of + his own family; the rest goes to market, in order to find the best price + which is to be had, and which can scarce be so low is to discourage him + from sending thither whatever is over and above the use of his own family. + If it is very low indeed, he will be likely to manage his dairy in a very + slovenly and dirty manner, and will scarce, perhaps, think it worth while + to have a particular room or building on purpose for it, but will suffer + the business to be carried on amidst the smoke, filth, and nastiness of + his own kitchen, as was the case of almost all the farmers’ dairies in + Scotland thirty or forty years ago, and as is the case of many of them + still. The same causes which gradually raise the price of butcher’s meat, + the increase of the demand, and, in consequence of the improvement of the + country, the diminution of the quantity which can be fed at little or no + expense, raise, in the same manner, that of the produce of the dairy, of + which the price naturally connects with that of butcher’s meat, or with + the expense of feeding cattle. The increase of price pays for more labour, + care, and cleanliness. The dairy becomes more worthy of the farmer’s + attention, and the quality of its produce gradually improves. The price at + last gets so high, that it becomes worth while to employ some of the most + fertile and best cultivated lands in feeding cattle merely for the purpose + of the dairy; and when it has got to this height, it cannot well go + higher. If it did, more land would soon be turned to this purpose. It + seems to have got to this height through the greater part of England, + where much good land is commonly employed in this manner. If you except + the neighbourhood of a few considerable towns, it seems not yet to have + got to this height anywhere in Scotland, where common farmers seldom + employ much good land in raising food for cattle, merely for the purpose + of the dairy. The price of the produce, though it has risen very + considerably within these few years, is probably still too low to admit of + it. The inferiority of the quality, indeed, compared with that of the + produce of English dairies, is fully equal to that of the price. But this + inferiority of quality is, perhaps, rather the effect of this lowness of + price, than the cause of it. Though the quality was much better, the + greater part of what is brought to market could not, I apprehend, in the + present circumstances of the country, be disposed of at a much better + price; and the present price, it is probable, would not pay the expense of + the land and labour necessary for producing a much better quality. Through + the greater part of England, notwithstanding the superiority of price, the + dairy is not reckoned a more profitable employment of land than the + raising of corn, or the fattening of cattle, the two great objects of + agriculture. Through the greater part of Scotland, therefore, it cannot + yet be even so profitable. + + The lands of no country, it is evident, can ever be completely cultivated + and improved, till once the price of every produce, which human industry + is obliged to raise upon them, has got so high as to pay for the expense + of complete improvement and cultivation. In order to do this, the price of + each particular produce must be sufficient, first, to pay the rent of good + corn land, as it is that which regulates the rent of the greater part of + other cultivated land; and, secondly, to pay the labour and expense of the + farmer, as well as they are commonly paid upon good corn land; or, in + other words, to replace with the ordinary profits the stock which he + employs about it. This rise in the price of each particular produce; must + evidently be previous to the improvement and cultivation of the land which + is destined for raising it. Gain is the end of all improvement; and + nothing could deserve that name, of which loss was to be the necessary + consequence. But loss must be the necessary consequence of improving land + for the sake of a produce of which the price could never bring back the + expense. If the complete improvement and cultivation of the country be, as + it most certainly is, the greatest of all public advantages, this rise in + the price of all those different sorts of rude produce, instead of being + considered as a public calamity, ought to be regarded as the necessary + forerunner and attendant of the greatest of all public advantages. + + This rise, too, in the nominal or money price of all those different sorts + of rude produce, has been the effect, not of any degradation in the value + of silver, but of a rise in their real price. They have become worth, not + only a greater quantity of silver, but a greater quantity of labour and + subsistence than before. As it costs a greater quantity of labour and + subsistence to bring them to market, so, when they are brought thither + they represent, or are equivalent to a greater quantity. + + Third Sort.—The third and last sort of rude produce, of which the + price naturally rises in the progress of improvement, is that in which the + efficacy of human industry, in augmenting the quantity, is either limited + or uncertain. Though the real price of this sort of rude produce, + therefore, naturally tends to rise in the progress of improvement, yet, + according as different accidents happen to render the efforts of human + industry more or less successful in augmenting the quantity, it may happen + sometimes even to fall, sometimes to continue the same, in very different + periods of improvement, and sometimes to rise more or less in the same + period. + + There are some sorts of rude produce which nature has rendered a kind of + appendages to other sorts; so that the quantity of the one which any + country can afford, is necessarily limited by that of the other. The + quantity of wool or of raw hides, for example, which any country can + afford, is necessarily limited by the number of great and small cattle + that are kept in it. The state of its improvement, and the nature of its + agriculture, again necessarily determine this number. + + The same causes which, in the progress of improvement, gradually raise the + price of butcher’s meat, should have the same effect, it may be thought, + upon the prices of wool and raw hides, and raise them, too, nearly in the + same proportion. It probably would be so, if, in the rude beginnings of + improvement, the market for the latter commodities was confined within as + narrow bounds as that for the former. But the extent of their respective + markets is commonly extremely different. + + The market for butcher’s meat is almost everywhere confined to the country + which produces it. Ireland, and some part of British America, indeed, + carry on a considerable trade in salt provisions; but they are, I believe, + the only countries in the commercial world which do so, or which export to + other countries any considerable part of their butcher’s meat. + + The market for wool and raw hides, on the contrary, is, in the rude + beginnings of improvement, very seldom confined to the country which + produces them. They can easily be transported to distant countries; wool + without any preparation, and raw hides with very little; and as they are + the materials of many manufactures, the industry of other countries may + occasion a demand for them, though that of the country which produces them + might not occasion any. + + In countries ill cultivated, and therefore but thinly inhabited, the price + of the wool and the hide bears always a much greater proportion to that of + the whole beast, than in countries where, improvement and population being + further advanced, there is more demand for butcher’s meat. Mr Hume + observes, that in the Saxon times, the fleece was estimated at two-fifths + of the value of the whole sheep and that this was much above the + proportion of its present estimation. In some provinces of Spain, I have + been assured, the sheep is frequently killed merely for the sake of the + fleece and the tallow. The carcase is often left to rot upon the ground, + or to be devoured by beasts and birds of prey. If this sometimes happens + even in Spain, it happens almost constantly in Chili, at Buenos Ayres, and + in many other parts of Spanish America, where the horned cattle are almost + constantly killed merely for the sake of the hide and the tallow. This, + too, used to happen almost constantly in Hispaniola, while it was infested + by the buccaneers, and before the settlement, improvement, and + populousness of the French plantations ( which now extend round the coast + of almost the whole western half of the island) had given some value to + the cattle of the Spaniards, who still continue to possess, not only the + eastern part of the coast, but the whole inland mountainous part of the + country. + + Though, in the progress of improvement and population, the price of the + whole beast necessarily rises, yet the price of the carcase is likely to + be much more affected by this rise than that of the wool and the hide. The + market for the carcase being in the rude state of society confined always + to the country which produces it, must necessarily be extended in + proportion to the improvement and population of that country. But the + market for the wool and the hides, even of a barbarous country, often + extending to the whole commercial world, it can very seldom be enlarged in + the same proportion. The state of the whole commercial world can seldom be + much affected by the improvement of any particular country; and the market + for such commodities may remain the same, or very nearly the same, after + such improvements, as before. It should, however, in the natural course of + things, rather, upon the whole, be somewhat extended in consequence of + them. If the manufactures, especially, of which those commodities are the + materials, should ever come to flourish in the country, the market, though + it might not be much enlarged, would at least be brought much nearer to + the place of growth than before; and the price of those materials might at + least be increased by what had usually been the expense of transporting + them to distant countries. Though it might not rise, therefore, in the + same proportion as that of butcher’s meat, it ought naturally to rise + somewhat, and it ought certainly not to fall. + + In England, however, notwithstanding the flourishing state of its woollen + manufacture, the price of English wool has fallen very considerably since + the time of Edward III. There are many authentic records which demonstrate + that, during the reign of that prince (towards the middle of the + fourteenth century, or about 1339), what was reckoned the moderate and + reasonable price of the tod, or twenty-eight pounds of English wool, was + not less than ten shillings of the money of those times {See Smith’s + Memoirs of Wool, vol. i c. 5, 6, 7. also vol. ii.}, containing, at the + rate of twenty-pence the ounce, six ounces of silver, Tower weight, equal + to about thirty shillings of our present money. In the present times, + one-and-twenty shillings the tod may be reckoned a good price for very + good English wool. The money price of wool, therefore, in the time of + Edward III. was to its money price in the present times as ten to seven. + The superiority of its real price was still greater. At the rate of six + shillings and eightpence the quarter, ten shillings was in those ancient + times the price of twelve bushels of wheat. At the rate of twenty-eight + shillings the quarter, one-and-twenty shillings is in the present times + the price of six bushels only. The proportion between the real price of + ancient and modern times, therefore, is as twelve to six, or as two to + one. In those ancient times, a tod of wool would have purchased twice the + quantity of subsistence which it will purchase at present, and + consequently twice the quantity of labour, if the real recompence of + labour had been the same in both periods. + + This degradation, both in the real and nominal value of wool, could never + have happened in consequence of the natural course of things. It has + accordingly been the effect of violence and artifice. First, of the + absolute prohibition of exporting wool from England: secondly, of the + permission of importing it from Spain, duty free: thirdly, of the + prohibition of exporting it from Ireland to another country but England. + In consequence of these regulations, the market for English wool, instead + of being somewhat extended, in consequence of the improvement of England, + has been confined to the home market, where the wool of several other + countries is allowed to come into competition with it, and where that of + Ireland is forced into competition with it. As the woollen manufactures, + too, of Ireland, are fully as much discouraged as is consistent with + justice and fair dealing, the Irish can work up but a smaller part of + their own wool at home, and are therefore obliged to send a greater + proportion of it to Great Britain, the only market they are allowed. + + I have not been able to find any such authentic records concerning the + price of raw hides in ancient times. Wool was commonly paid as a subsidy + to the king, and its valuation in that subsidy ascertains, at least in + some degree, what was its ordinary price. But this seems not to have been + the case with raw hides. Fleetwood, however, from an account in 1425, + between the prior of Burcester Oxford and one of his canons, gives us + their price, at least as it was stated upon that particular occasion, viz. + five ox hides at twelve shillings; five cow hides at seven shillings and + threepence; thirtysix sheep skins of two years old at nine shillings; + sixteen calf skins at two shillings. In 1425, twelve shillings contained + about the same quantity of silver as four-and-twenty shillings of our + present money. An ox hide, therefore, was in this account valued at the + same quantity of silver as 4s. ⅘ths of our present money. Its nominal + price was a good deal lower than at present. But at the rate of six + shillings and eightpence the quarter, twelve shillings would in those + times have purchased fourteen bushels and four-fifths of a bushel of + wheat, which, at three and sixpence the bushel, would in the present times + cost 51s. 4d. An ox hide, therefore, would in those times have purchased + as much corn as ten shillings and threepence would purchase at present. + Its real value was equal to ten shillings and threepence of our present + money. In those ancient times, when the cattle were half starved during + the greater part of the winter, we cannot suppose that they were of a very + large size. An ox hide which weighs four stone of sixteen pounds of + avoirdupois, is not in the present times reckoned a bad one; and in those + ancient times would probably have been reckoned a very good one. But at + half-a-crown the stone, which at this moment (February 1773) I understand + to be the common price, such a hide would at present cost only ten + shillings. Through its nominal price, therefore, is higher in the present + than it was in those ancient times, its real price, the real quantity of + subsistence which it will purchase or command, is rather somewhat lower. + The price of cow hides, as stated in the above account, is nearly in the + common proportion to that of ox hides. That of sheep skins is a good deal + above it. They had probably been sold with the wool. That of calves skins, + on the contrary, is greatly below it. In countries where the price of + cattle is very low, the calves, which are not intended to be reared in + order to keep up the stock, are generally killed very young, as was the + case in Scotland twenty or thirty years ago. It saves the milk, which + their price would not pay for. Their skins, therefore, are commonly good + for little. + + The price of raw hides is a good deal lower at present than it was a few + years ago; owing probably to the taking off the duty upon seal skins, and + to the allowing, for a limited time, the importation of raw hides from + Ireland, and from the plantations, duty free, which was done in 1769. Take + the whole of the present century at an average, their real price has + probably been somewhat higher than it was in those ancient times. The + nature of the commodity renders it not quite so proper for being + transported to distant markets as wool. It suffers more by keeping. A + salted hide is reckoned inferior to a fresh one, and sells for a lower + price. This circumstance must necessarily have some tendency to sink the + price of raw hides produced in a country which does not manufacture them, + but is obliged to export them, and comparatively to raise that of those + produced in a country which does manufacture them. It must have some + tendency to sink their price in a barbarous, and to raise it in an + improved and manufacturing country. It must have had some tendency, + therefore, to sink it in ancient, and to raise it in modern times. Our + tanners, besides, have not been quite so successful as our clothiers, in + convincing the wisdom of the nation, that the safety of the commonwealth + depends upon the prosperity of their particular manufacture. They have + accordingly been much less favoured. The exportation of raw hides has, + indeed, been prohibited, and declared a nuisance; but their importation + from foreign countries has been subjected to a duty; and though this duty + has been taken off from those of Ireland and the plantations (for the + limited time of five years only), yet Ireland has not been confined to the + market of Great Britain for the sale of its surplus hides, or of those + which are not manufactured at home. The hides of common cattle have, but + within these few years, been put among the enumerated commodities which + the plantations can send nowhere but to the mother country; neither has + the commerce of Ireland been in this case oppressed hitherto, in order to + support the manufactures of Great Britain. + + Whatever regulations tend to sink the price, either of wool or of raw + hides, below what it naturally would be, must, in an improved and + cultivated country, have some tendency to raise the price of butcher’s + meat. The price both of the great and small cattle, which are fed on + improved and cultivated land, must be sufficient to pay the rent which the + landlord, and the profit which the farmer, has reason to expect from + improved and cultivated land. If it is not, they will soon cease to feed + them. Whatever part of this price, therefore, is not paid by the wool and + the hide, must be paid by the carcase. The less there is paid for the one, + the more must be paid for the other. In what manner this price is to be + divided upon the different parts of the beast, is indifferent to the + landlords and farmers, provided it is all paid to them. In an improved and + cultivated country, therefore, their interest as landlords and farmers + cannot be much affected by such regulations, though their interest as + consumers may, by the rise in the price of provisions. It would be quite + otherwise, however, in an unimproved and uncultivated country, where the + greater part of the lands could be applied to no other purpose but the + feeding of cattle, and where the wool and the hide made the principal part + of the value of those cattle. Their interest as landlords and farmers + would in this case be very deeply affected by such regulations, and their + interest as consumers very little. The fall in the price of the wool and + the hide would not in this case raise the price of the carcase; because + the greater part of the lands of the country being applicable to no other + purpose but the feeding of cattle, the same number would still continue to + be fed. The same quantity of butcher’s meat would still come to market. + The demand for it would be no greater than before. Its price, therefore, + would be the same as before. The whole price of cattle would fall, and + along with it both the rent and the profit of all those lands of which + cattle was the principal produce, that is, of the greater part of the + lands of the country. The perpetual prohibition of the exportation of + wool, which is commonly, but very falsely, ascribed to Edward III., would, + in the then circumstances of the country, have been the most destructive + regulation which could well have been thought of. It would not only have + reduced the actual value of the greater part of the lands in the kingdom, + but by reducing the price of the most important species of small cattle, + it would have retarded very much its subsequent improvement. + + The wool of Scotland fell very considerably in its price in consequence of + the union with England, by which it was excluded from the great market of + Europe, and confined to the narrow one of Great Britain. The value of the + greater part of the lands in the southern counties of Scotland, which are + chiefly a sheep country, would have been very deeply affected by this + event, had not the rise in the price of butcher’s meat fully compensated + the fall in the price of wool. + + As the efficacy of human industry, in increasing the quantity either of + wool or of raw hides, is limited, so far as it depends upon the produce of + the country where it is exerted; so it is uncertain so far as it depends + upon the produce of other countries. It so far depends not so much upon + the quantity which they produce, as upon that which they do not + manufacture; and upon the restraints which they may or may not think + proper to impose upon the exportation of this sort of rude produce. These + circumstances, as they are altogether independent of domestic industry, so + they necessarily render the efficacy of its efforts more or less + uncertain. In multiplying this sort of rude produce, therefore, the + efficacy of human industry is not only limited, but uncertain. + + In multiplying another very important sort of rude produce, the quantity + of fish that is brought to market, it is likewise both limited and + uncertain. It is limited by the local situation of the country, by the + proximity or distance of its different provinces from the sea, by the + number of its lakes and rivers, and by what may be called the fertility or + barrenness of those seas, lakes, and rivers, as to this sort of rude + produce. As population increases, as the annual produce of the land and + labour of the country grows greater and greater, there come to be more + buyers of fish; and those buyers, too, have a greater quantity and variety + of other goods, or, what is the same thing, the price of a greater + quantity and variety of other goods, to buy with. But it will generally be + impossible to supply the great and extended market, without employing a + quantity of labour greater than in proportion to what had been requisite + for supplying the narrow and confined one. A market which, from requiring + only one thousand, comes to require annually ten thousand ton of fish, can + seldom be supplied, without employing more than ten times the quantity of + labour which had before been sufficient to supply it. The fish must + generally be sought for at a greater distance, larger vessels must be + employed, and more expensive machinery of every kind made use of. The real + price of this commodity, therefore, naturally rises in the progress of + improvement. It has accordingly done so, I believe, more or less in every + country. + + Though the success of a particular day’s fishing may be a very uncertain + matter, yet the local situation of the country being supposed, the general + efficacy of industry in bringing a certain quantity of fish to market, + taking the course of a year, or of several years together, it may, + perhaps, be thought is certain enough; and it, no doubt, is so. As it + depends more, however, upon the local situation of the country, than upon + the state of its wealth and industry; as upon this account it may in + different countries be the same in very different periods of improvement, + and very different in the same period; its connection with the state of + improvement is uncertain; and it is of this sort of uncertainty that I am + here speaking. + + In increasing the quantity of the different minerals and metals which are + drawn from the bowels of the earth, that of the more precious ones + particularly, the efficacy of human industry seems not to be limited, but + to be altogether uncertain. + + The quantity of the precious metals which is to be found in any country, + is not limited by any thing in its local situation, such as the fertility + or barrenness of its own mines. Those metals frequently abound in + countries which possess no mines. Their quantity, in every particular + country, seems to depend upon two different circumstances; first, upon its + power of purchasing, upon the state of its industry, upon the annual + produce of its land and labour, in consequence of which it can afford to + employ a greater or a smaller quantity of labour and subsistence, in + bringing or purchasing such superfluities as gold and silver, either from + its own mines, or from those of other countries; and, secondly, upon the + fertility or barrenness of the mines which may happen at any particular + time to supply the commercial world with those metals. The quantity of + those metals in the countries most remote from the mines, must be more or + less affected by this fertility or barrenness, on account of the easy and + cheap transportation of those metals, of their small bulk and great value. + Their quantity in China and Indostan must have been more or less affected + by the abundance of the mines of America. + + So far as their quantity in any particular country depends upon the former + of those two circumstances (the power of purchasing), their real price, + like that of all other luxuries and superfluities, is likely to rise with + the wealth and improvement of the country, and to fall with its poverty + and depression. Countries which have a great quantity of labour and + subsistence to spare, can afford to purchase any particular quantity of + those metals at the expense of a greater quantity of labour and + subsistence, than countries which have less to spare. + + So far as their quantity in any particular country depends upon the latter + of those two circumstances (the fertility or barrenness of the mines which + happen to supply the commercial world), their real price, the real + quantity of labour and subsistence which they will purchase or exchange + for, will, no doubt, sink more or less in proportion to the fertility, and + rise in proportion to the barrenness of those mines. + + The fertility or barrenness of the mines, however, which may happen at any + particular time to supply the commercial world, is a circumstance which, + it is evident, may have no sort of connection with the state of industry + in a particular country. It seems even to have no very necessary + connection with that of the world in general. As arts and commerce, + indeed, gradually spread themselves over a greater and a greater part of + the earth, the search for new mines, being extended over a wider surface, + may have somewhat a better chance for being successful than when confined + within narrower bounds. The discovery of new mines, however, as the old + ones come to be gradually exhausted, is a matter of the greatest + uncertainty, and such as no human skill or industry can insure. All + indications, it is acknowledged, are doubtful; and the actual discovery + and successful working of a new mine can alone ascertain the reality of + its value, or even of its existence. In this search there seem to be no + certain limits, either to the possible success, or to the possible + disappointment of human industry. In the course of a century or two, it is + possible that new mines may be discovered, more fertile than any that have + ever yet been known; and it is just equally possible, that the most + fertile mine then known may be more barren than any that was wrought + before the discovery of the mines of America. Whether the one or the other + of those two events may happen to take place, is of very little importance + to the real wealth and prosperity of the world, to the real value of the + annual produce of the land and labour of mankind. Its nominal value, the + quantity of gold and silver by which this annual produce could be + expressed or represented, would, no doubt, be very different; but its real + value, the real quantity of labour which it could purchase or command, + would be precisely the same. A shilling might, in the one case, represent + no more labour than a penny does at present; and a penny, in the other, + might represent as much as a shilling does now. But in the one case, he + who had a shilling in his pocket would be no richer than he who has a + penny at present; and in the other, he who had a penny would be just as + rich as he who has a shilling now. The cheapness and abundance of gold and + silver plate would be the sole advantage which the world could derive from + the one event; and the dearness and scarcity of those trifling + superfluities, the only inconveniency it could suffer from the other. + + + + + Conclusion of the Digression concerning the Variations in the Value of + Silver. + + The greater part of the writers who have collected the money price of + things in ancient times, seem to have considered the low money price of + corn, and of goods in general, or, in other words, the high value of gold + and silver, as a proof, not only of the scarcity of those metals, but of + the poverty and barbarism of the country at the time when it took place. + This notion is connected with the system of political economy, which + represents national wealth as consisting in the abundance and national + poverty in the scarcity, of gold and silver; a system which I shall + endeavour to explain and examine at great length in the fourth book of + this Inquiry. I shall only observe at present, that the high value of the + precious metals can be no proof of the poverty or barbarism of any + particular country at the time when it took place. It is a proof only of + the barrenness of the mines which happened at that time to supply the + commercial world. A poor country, as it cannot afford to buy more, so it + can as little afford to pay dearer for gold and silver than a rich one; + and the value of those metals, therefore, is not likely to be higher in + the former than in the latter. In China, a country much richer than any + part of Europe, the value of the precious metals is much higher than in + any part of Europe. As the wealth of Europe, indeed, has increased greatly + since the discovery of the mines of America, so the value of gold and + silver has gradually diminished. This diminution of their value, however, + has not been owing to the increase of the real wealth of Europe, of the + annual produce of its land and labour, but to the accidental discovery of + more abundant mines than any that were known before. The increase of the + quantity of gold and silver in Europe, and the increase of its + manufactures and agriculture, are two events which, though they have + happened nearly about the same time, yet have arisen from very different + causes, and have scarce any natural connection with one another. The one + has arisen from a mere accident, in which neither prudence nor policy + either had or could have any share; the other, from the fall of the feudal + system, and from the establishment of a government which afforded to + industry the only encouragement which it requires, some tolerable security + that it shall enjoy the fruits of its own labour. Poland, where the feudal + system still continues to take place, is at this day as beggarly a country + as it was before the discovery of America. The money price of corn, + however, has risen; the real value of the precious metals has fallen in + Poland, in the same manner as in other parts of Europe. Their quantity, + therefore, must have increased there as in other places, and nearly in the + same proportion to the annual produce of its land and labour. This + increase of the quantity of those metals, however, has not, it seems, + increased that annual produce, has neither improved the manufactures and + agriculture of the country, nor mended the circumstances of its + inhabitants. Spain and Portugal, the countries which possess the mines, + are, after Poland, perhaps the two most beggarly countries in Europe. The + value of the precious metals, however, must be lower in Spain and Portugal + than in any other part of Europe, as they come from those countries to all + other parts of Europe, loaded, not only with a freight and an insurance, + but with the expense of smuggling, their exportation being either + prohibited or subjected to a duty. In proportion to the annual produce of + the land and labour, therefore, their quantity must be greater in those + countries than in any other part of Europe; those countries, however, are + poorer than the greater part of Europe. Though the feudal system has been + abolished in Spain and Portugal, it has not been succeeded by a much + better. + + As the low value of gold and silver, therefore, is no proof of the wealth + and flourishing state of the country where it takes place; so neither is + their high value, or the low money price either of goods in general, or of + corn in particular, any proof of its poverty and barbarism. + + But though the low money price, either of goods in general, or of corn in + particular, be no proof of the poverty or barbarism of the times, the low + money price of some particular sorts of goods, such as cattle, poultry, + game of all kinds, etc. in proportion to that of corn, is a most decisive + one. It clearly demonstrates, first, their great abundance in proportion + to that of corn, and, consequently, the great extent of the land which + they occupied in proportion to what was occupied by corn; and, secondly, + the low value of this land in proportion to that of corn land, and, + consequently, the uncultivated and unimproved state of the far greater + part of the lands of the country. It clearly demonstrates, that the stock + and population of the country did not bear the same proportion to the + extent of its territory, which they commonly do in civilized countries; + and that society was at that time, and in that country, but in its + infancy. From the high or low money price, either of goods in general, or + of corn in particular, we can infer only, that the mines, which at that + time happened to supply the commercial world with gold and silver, were + fertile or barren, not that the country was rich or poor. But from the + high or low money price of some sorts of goods in proportion to that of + others, we can infer, with a degree of probability that approaches almost + to certainty, that it was rich or poor, that the greater part of its lands + were improved or unimproved, and that it was either in a more or less + barbarous state, or in a more or less civilized one. + + Any rise in the money price of goods which proceeded altogether from the + degradation of the value of silver, would affect all sorts of goods + equally, and raise their price universally, a third, or a fourth, or a + fifth part higher, according as silver happened to lose a third, or a + fourth, or a fifth part of its former value. But the rise in the price of + provisions, which has been the subject of so much reasoning and + conversation, does not affect all sorts of provisions equally. Taking the + course of the present century at an average, the price of corn, it is + acknowledged, even by those who account for this rise by the degradation + of the value of silver, has risen much less than that of some other sorts + of provisions. The rise in the price of those other sorts of provisions, + therefore, cannot be owing altogether to the degradation of the value of + silver. Some other causes must be taken into the account; and those which + have been above assigned, will, perhaps, without having recourse to the + supposed degradation of the value of silver, sufficiently explain this + rise in those particular sorts of provisions, of which the price has + actually risen in proportion to that of corn. + + As to the price of corn itself, it has, during the sixty-four first years + of the present century, and before the late extraordinary course of bad + seasons, been somewhat lower than it was during the sixty-four last years + of the preceding century. This fact is attested, not only by the accounts + of Windsor market, but by the public fiars of all the different counties + of Scotland, and by the accounts of several different markets in France, + which have been collected with great diligence and fidelity by Mr + Messance, and by Mr Dupré de St Maur. The evidence is more complete than + could well have been expected in a matter which is naturally so very + difficult to be ascertained. + + As to the high price of corn during these last ten or twelve years, it can + be sufficiently accounted for from the badness of the seasons, without + supposing any degradation in the value of silver. + + The opinion, therefore, that silver is continually sinking in its value, + seems not to be founded upon any good observations, either upon the prices + of corn, or upon those of other provisions. + + The same quantity of silver, it may perhaps be said, will, in the present + times, even according to the account which has been here given, purchase a + much smaller quantity of several sorts of provisions than it would have + done during some part of the last century; and to ascertain whether this + change be owing to a rise in the value of those goods, or to a fall in the + value of silver, is only to establish a vain and useless distinction, + which can be of no sort of service to the man who has only a certain + quantity of silver to go to market with, or a certain fixed revenue in + money. I certainly do not pretend that the knowledge of this distinction + will enable him to buy cheaper. It may not, however, upon that account be + altogether useless. + + It may be of some use to the public, by affording an easy proof of the + prosperous condition of the country. If the rise in the price of some + sorts of provisions be owing altogether to a fall in the value of silver, + it is owing to a circumstance, from which nothing can be inferred but the + fertility of the American mines. The real wealth of the country, the + annual produce of its land and labour, may, notwithstanding this + circumstance, be either gradually declining, as in Portugal and Poland; or + gradually advancing, as in most other parts of Europe. But if this rise in + the price of some sorts of provisions be owing to a rise in the real value + of the land which produces them, to its increased fertility, or, in + consequence of more extended improvement and good cultivation, to its + having been rendered fit for producing corn; it is owing to a circumstance + which indicates, in the clearest manner, the prosperous and advancing + state of the country. The land constitutes by far the greatest, the most + important, and the most durable part of the wealth of every extensive + country. It may surely be of some use, or, at least, it may give some + satisfaction to the public, to have so decisive a proof of the increasing + value of by far the greatest, the most important, and the most durable + part of its wealth. + + It may, too, be of some use to the public, in regulating the pecuniary + reward of some of its inferior servants. If this rise in the price of some + sorts of provisions be owing to a fall in the value of silver, their + pecuniary reward, provided it was not too large before, ought certainly to + be augmented in proportion to the extent of this fall. If it is not + augmented, their real recompence will evidently be so much diminished. But + if this rise of price is owing to the increased value, in consequence of + the improved fertility of the land which produces such provisions, it + becomes a much nicer matter to judge, either in what proportion any + pecuniary reward ought to be augmented, or whether it ought to be + augmented at all. The extension of improvement and cultivation, as it + necessarily raises more or less, in proportion to the price of corn, that + of every sort of animal food, so it as necessarily lowers that of, I + believe, every sort of vegetable food. It raises the price of animal food; + because a great part of the land which produces it, being rendered fit for + producing corn, must afford to the landlord and farmer the rent and + profit of corn land. It lowers the price of vegetable food; because, by + increasing the fertility of the land, it increases its abundance. The + improvements of agriculture, too, introduce many sorts of vegetable food, + which requiring less land, and not more labour than corn, come much + cheaper to market. Such are potatoes and maize, or what is called Indian + corn, the two most important improvements which the agriculture of Europe, + perhaps, which Europe itself, has received from the great extension of its + commerce and navigation. Many sorts of vegetable food, besides, which in + the rude state of agriculture are confined to the kitchen-garden, and + raised only by the spade, come, in its improved state, to be introduced + into common fields, and to be raised by the plough; such as turnips, + carrots, cabbages, etc. If, in the progress of improvement, therefore, the + real price of one species of food necessarily rises, that of another as + necessarily falls; and it becomes a matter of more nicety to judge how far + the rise in the one may be compensated by the fall in the other. When the + real price of butcher’s meat has once got to its height (which, with + regard to every sort, except perhaps that of hogs flesh, it seems to have + done through a great part of England more than a century ago), any rise + which can afterwards happen in that of any other sort of animal food, + cannot much affect the circumstances of the inferior ranks of people. The + circumstances of the poor, through a great part of England, cannot surely + be so much distressed by any rise in the price of poultry, fish, + wild-fowl, or venison, as they must be relieved by the fall in that of + potatoes. + + In the present season of scarcity, the high price of corn no doubt + distresses the poor. But in times of moderate plenty, when corn is at its + ordinary or average price, the natural rise in the price of any other sort + of rude produce cannot much affect them. They suffer more, perhaps, by the + artificial rise which has been occasioned by taxes in the price of some + manufactured commodities, as of salt, soap, leather, candles, malt, beer, + ale, etc. + + + _Effects of the Progress of Improvement upon the real Price of + Manufactures._ + + + It is the natural effect of improvement, however, to diminish gradually + the real price of almost all manufactures. That of the manufacturing + workmanship diminishes, perhaps, in all of them without exception. In + consequence of better machinery, of greater dexterity, and of a more + proper division and distribution of work, all of which are the natural + effects of improvement, a much smaller quantity of labour becomes + requisite for executing any particular piece of work; and though, in + consequence of the flourishing circumstances of the society, the real + price of labour should rise very considerably, yet the great diminution of + the quantity will generally much more than compensate the greatest rise + which can happen in the price. + + There are, indeed, a few manufactures, in which the necessary rise in the + real price of the rude materials will more than compensate all the + advantages which improvement can introduce into the execution of the work. + In carpenters’ and joiners’ work, and in the coarser sort of cabinet work, + the necessary rise in the real price of barren timber, in consequence of + the improvement of land, will more than compensate all the advantages + which can be derived from the best machinery, the greatest dexterity, and + the most proper division and distribution of work. + + But in all cases in which the real price of the rude material either does + not rise at all, or does not rise very much, that of the manufactured + commodity sinks very considerably. + + This diminution of price has, in the course of the present and preceding + century, been most remarkable in those manufactures of which the materials + are the coarser metals. A better movement of a watch, than about the + middle of the last century could have been bought for twenty pounds, may + now perhaps be had for twenty shillings. In the work of cutlers and + locksmiths, in all the toys which are made of the coarser metals, and in + all those goods which are commonly known by the name of Birmingham and + Sheffield ware, there has been, during the same period, a very great + reduction of price, though not altogether so great as in watch-work. It + has, however, been sufficient to astonish the workmen of every other part + of Europe, who in many cases acknowledge that they can produce no work of + equal goodness for double or even for triple the price. There are perhaps + no manufactures, in which the division of labour can be carried further, + or in which the machinery employed admits of a greater variety of + improvements, than those of which the materials are the coarser metals. + + In the clothing manufacture there has, during the same period, been no + such sensible reduction of price. The price of superfine cloth, I have + been assured, on the contrary, has, within these five-and-twenty or thirty + years, risen somewhat in proportion to its quality, owing, it was said, to + a considerable rise in the price of the material, which consists + altogether of Spanish wool. That of the Yorkshire cloth, which is made + altogether of English wool, is said, indeed, during the course of the + present century, to have fallen a good deal in proportion to its quality. + Quality, however, is so very disputable a matter, that I look upon all + information of this kind as somewhat uncertain. In the clothing + manufacture, the division of labour is nearly the same now as it was a + century ago, and the machinery employed is not very different. There may, + however, have been some small improvements in both, which may have + occasioned some reduction of price. + + But the reduction will appear much more sensible and undeniable, if we + compare the price of this manufacture in the present times with what it + was in a much remoter period, towards the end of the fifteenth century, + when the labour was probably much less subdivided, and the machinery + employed much more imperfect, than it is at present. + + In 1487, being the 4th of Henry VII., it was enacted, that “whosoever + shall sell by retail a broad yard of the finest scarlet grained, or of + other grained cloth of the finest making, above sixteen shillings, shall + forfeit forty shillings for every yard so sold.” Sixteen shillings, + therefore, containing about the same quantity of silver as four-and-twenty + shillings of our present money, was, at that time, reckoned not an + unreasonable price for a yard of the finest cloth; and as this is a + sumptuary law, such cloth, it is probable, had usually been sold somewhat + dearer. A guinea may be reckoned the highest price in the present times. + Even though the quality of the cloths, therefore, should be supposed + equal, and that of the present times is most probably much superior, yet, + even upon this supposition, the money price of the finest cloth appears to + have been considerably reduced since the end of the fifteenth century. But + its real price has been much more reduced. Six shillings and eightpence + was then, and long afterwards, reckoned the average price of a quarter of + wheat. Sixteen shillings, therefore, was the price of two quarters and + more than three bushels of wheat. Valuing a quarter of wheat in the + present times at eight-and-twenty shillings, the real price of a yard of + fine cloth must, in those times, have been equal to at least three pounds + six shillings and sixpence of our present money. The man who bought it + must have parted with the command of a quantity of labour and subsistence + equal to what that sum would purchase in the present times. + + The reduction in the real price of the coarse manufacture, though + considerable, has not been so great as in that of the fine. + + In 1463, being the 3rd of Edward IV. it was enacted, that “no servant in + husbandry nor common labourer, nor servant to any artificer inhabiting out + of a city or burgh, shall use or wear in their clothing any cloth above + two shillings the broad yard.” In the 3rd of Edward IV., two shillings + contained very nearly the same quantity of silver as four of our present + money. But the Yorkshire cloth which is now sold at four shillings the + yard, is probably much superior to any that was then made for the wearing + of the very poorest order of common servants. Even the money price of + their clothing, therefore, may, in proportion to the quality, be somewhat + cheaper in the present than it was in those ancient times. The real price + is certainly a good deal cheaper. Tenpence was then reckoned what is + called the moderate and reasonable price of a bushel of wheat. Two + shillings, therefore, was the price of two bushels and near two pecks of + wheat, which in the present times, at three shillings and sixpence the + bushel, would be worth eight shillings and ninepence. For a yard of this + cloth the poor servant must have parted with the power of purchasing a + quantity of subsistence equal to what eight shillings and ninepence would + purchase in the present times. This is a sumptuary law, too, restraining + the luxury and extravagance of the poor. Their clothing, therefore, had + commonly been much more expensive. + + The same order of people are, by the same law, prohibited from wearing + hose, of which the price should exceed fourteen-pence the pair, equal to + about eight-and-twenty pence of our present money. But fourteen-pence was + in those times the price of a bushel and near two pecks of wheat; which in + the present times, at three and sixpence the bushel, would cost five + shillings and threepence. We should in the present times consider this as + a very high price for a pair of stockings to a servant of the poorest and + lowest order. He must however, in those times, have paid what was really + equivalent to this price for them. + + In the time of Edward IV. the art of knitting stockings was probably not + known in any part of Europe. Their hose were made of common cloth, which + may have been one of the causes of their dearness. The first person that + wore stockings in England is said to have been Queen Elizabeth. She + received them as a present from the Spanish ambassador. + + Both in the coarse and in the fine woollen manufacture, the machinery + employed was much more imperfect in those ancient, than it is in the + present times. It has since received three very capital improvements, + besides, probably, many smaller ones, of which it may be difficult to + ascertain either the number or the importance. The three capital + improvements are, first, the exchange of the rock and spindle for the + spinning-wheel, which, with the same quantity of labour, will perform more + than double the quantity of work. Secondly, the use of several very + ingenious machines, which facilitate and abridge, in a still greater + proportion, the winding of the worsted and woollen yarn, or the proper + arrangement of the warp and woof before they are put into the loom; an + operation which, previous to the invention of those machines, must have + been extremely tedious and troublesome. Thirdly, the employment of the + fulling-mill for thickening the cloth, instead of treading it in water. + Neither wind nor water mills of any kind were known in England so early as + the beginning of the sixteenth century, nor, so far as I know, in any + other part of Europe north of the Alps. They had been introduced into + Italy some time before. + + The consideration of these circumstances may, perhaps, in some measure, + explain to us why the real price both of the coarse and of the fine + manufacture was so much higher in those ancient than it is in the present + times. It cost a greater quantity of labour to bring the goods to market. + When they were brought thither, therefore, they must have purchased, or + exchanged for the price of, a greater quantity. + + The coarse manufacture probably was, in those ancient times, carried on in + England in the same manner as it always has been in countries where arts + and manufactures are in their infancy. It was probably a household + manufacture, in which every different part of the work was occasionally + performed by all the different members of almost every private family, but + so as to be their work only when they had nothing else to do, and not to + be the principal business from which any of them derived the greater part + of their subsistence. The work which is performed in this manner, it has + already been observed, comes always much cheaper to market than that which + is the principal or sole fund of the workman’s subsistence. The fine + manufacture, on the other hand, was not, in those times, carried on in + England, but in the rich and commercial country of Flanders; and it was + probably conducted then, in the same manner as now, by people who derived + the whole, or the principal part of their subsistence from it. It was, + besides, a foreign manufacture, and must have paid some duty, the ancient + custom of tonnage and poundage at least, to the king. This duty, indeed, + would not probably be very great. It was not then the policy of Europe to + restrain, by high duties, the importation of foreign manufactures, but + rather to encourage it, in order that merchants might be enabled to + supply, at as easy a rate as possible, the great men with the + conveniencies and luxuries which they wanted, and which the industry of + their own country could not afford them. + + The consideration of these circumstances may, perhaps, in some measure + explain to us why, in those ancient times, the real price of the coarse + manufacture was, in proportion to that of the fine, so much lower than in + the present times. + + + + + Conclusion of the Chapter. + + I shall conclude this very long chapter with observing, that every + improvement in the circumstances of the society tends, either directly or + indirectly, to raise the real rent of land to increase the real wealth of + the landlord, his power of purchasing the labour, or the produce of the + labour of other people. + + The extension of improvement and cultivation tends to raise it directly. + The landlord’s share of the produce necessarily increases with the + increase of the produce. + + That rise in the real price of those parts of the rude produce of land, + which is first the effect of the extended improvement and cultivation, and + afterwards the cause of their being still further extended, the rise in + the price of cattle, for example, tends, too, to raise the rent of land + directly, and in a still greater proportion. The real value of the + landlord’s share, his real command of the labour of other people, not only + rises with the real value of the produce, but the proportion of his share + to the whole produce rises with it. + + That produce, after the rise in its real price, requires no more labour to + collect it than before. A smaller proportion of it will, therefore, be + sufficient to replace, with the ordinary profit, the stock which employs + that labour. A greater proportion of it must consequently belong to the + landlord. + + All those improvements in the productive powers of labour, which tend + directly to reduce the rent price of manufactures, tend indirectly to + raise the real rent of land. The landlord exchanges that part of his rude + produce, which is over and above his own consumption, or, what comes to + the same thing, the price of that part of it, for manufactured produce. + Whatever reduces the real price of the latter, raises that of the former. + An equal quantity of the former becomes thereby equivalent to a greater + quantity of the latter; and the landlord is enabled to purchase a greater + quantity of the conveniencies, ornaments, or luxuries which he has + occasion for. + + Every increase in the real wealth of the society, every increase in the + quantity of useful labour employed within it, tends indirectly to raise + the real rent of land. A certain proportion of this labour naturally goes + to the land. A greater number of men and cattle are employed in its + cultivation, the produce increases with the increase of the stock which is + thus employed in raising it, and the rent increases with the produce. + + The contrary circumstances, the neglect of cultivation and improvement, + the fall in the real price of any part of the rude produce of land, the + rise in the real price of manufactures from the decay of manufacturing art + and industry, the declension of the real wealth of the society, all tend, + on the other hand, to lower the real rent of land, to reduce the real + wealth of the landlord, to diminish his power of purchasing either the + labour, or the produce of the labour, of other people. + + The whole annual produce of the land and labour of every country, or, what + comes to the same thing, the whole price of that annual produce, naturally + divides itself, it has already been observed, into three parts; the rent + of land, the wages of labour, and the profits of stock; and constitutes a + revenue to three different orders of people; to those who live by rent, to + those who live by wages, and to those who live by profit. These are the + three great, original, and constituent, orders of every civilized society, + from whose revenue that of every other order is ultimately derived. + + The interest of the first of those three great orders, it appears from + what has been just now said, is strictly and inseparably connected with + the general interest of the society. Whatever either promotes or obstructs + the one, necessarily promotes or obstructs the other. When the public + deliberates concerning any regulation of commerce or police, the + proprietors of land never can mislead it, with a view to promote the + interest of their own particular order; at least, if they have any + tolerable knowledge of that interest. They are, indeed, too often + defective in this tolerable knowledge. They are the only one of the three + orders whose revenue costs them neither labour nor care, but comes to + them, as it were, of its own accord, and independent of any plan or + project of their own. That indolence which is the natural effect of the + ease and security of their situation, renders them too often, not only + ignorant, but incapable of that application of mind, which is necessary in + order to foresee and understand the consequence of any public regulation. + + The interest of the second order, that of those who live by wages, is as + strictly connected with the interest of the society as that of the first. + The wages of the labourer, it has already been shewn, are never so high as + when the demand for labour is continually rising, or when the quantity + employed is every year increasing considerably. When this real wealth of + the society becomes stationary, his wages are soon reduced to what is + barely enough to enable him to bring up a family, or to continue the race + of labourers. When the society declines, they fall even below this. The + order of proprietors may perhaps gain more by the prosperity of the + society than that of labourers; but there is no order that suffers so + cruelly from its decline. But though the interest of the labourer is + strictly connected with that of the society, he is incapable either of + comprehending that interest, or of understanding its connexion with his + own. His condition leaves him no time to receive the necessary + information, and his education and habits are commonly such as to render + him unfit to judge, even though he was fully informed. In the public + deliberations, therefore, his voice is little heard, and less regarded; + except upon particular occasions, when his clamour is animated, set on, + and supported by his employers, not for his, but their own particular + purposes. + + His employers constitute the third order, that of those who live by + profit. It is the stock that is employed for the sake of profit, which + puts into motion the greater part of the useful labour of every society. + The plans and projects of the employers of stock regulate and direct all + the most important operation of labour, and profit is the end proposed by + all those plans and projects. But the rate of profit does not, like rent + and wages, rise with the prosperity, and fall with the declension of the + society. On the contrary, it is naturally low in rich, and high in poor + countries, and it is always highest in the countries which are going + fastest to ruin. The interest of this third order, therefore, has not the + same connexion with the general interest of the society, as that of the + other two. Merchants and master manufacturers are, in this order, the two + classes of people who commonly employ the largest capitals, and who by + their wealth draw to themselves the greatest share of the public + consideration. As during their whole lives they are engaged in plans and + projects, they have frequently more acuteness of understanding than the + greater part of country gentlemen. As their thoughts, however, are + commonly exercised rather about the interest of their own particular + branch of business. than about that of the society, their judgment, even + when given with the greatest candour (which it has not been upon every + occasion), is much more to be depended upon with regard to the former of + those two objects, than with regard to the latter. Their superiority over + the country gentleman is, not so much in their knowledge of the public + interest, as in their having a better knowledge of their own interest than + he has of his. It is by this superior knowledge of their own interest that + they have frequently imposed upon his generosity, and persuaded him to + give up both his own interest and that of the public, from a very simple + but honest conviction, that their interest, and not his, was the interest + of the public. The interest of the dealers, however, in any particular + branch of trade or manufactures, is always in some respects different + from, and even opposite to, that of the public. To widen the market, and + to narrow the competition, is always the interest of the dealers. To widen + the market may frequently be agreeable enough to the interest of the + public; but to narrow the competition must always be against it, and can + only serve to enable the dealers, by raising their profits above what they + naturally would be, to levy, for their own benefit, an absurd tax upon the + rest of their fellow-citizens. The proposal of any new law or regulation + of commerce which comes from this order, ought always to be listened to + with great precaution, and ought never to be adopted till after having + been long and carefully examined, not only with the most scrupulous, but + with the most suspicious attention. It comes from an order of men, whose + interest is never exactly the same with that of the public, who have + generally an interest to deceive and even to oppress the public, and who + accordingly have, upon many occasions, both deceived and oppressed it. + + # PRICES OF WHEAT + + + Year Prices/Quarter Average of different Average prices of + in each year prices in one year each year in money + of 1776 + + £ s d £ s d £ s d + 1202 0 12 0 1 16 0 + 1205 0 12 0 + 0 13 4 0 13 5 2 0 3 + 0 15 0 + 1223 0 12 0 1 16 0 + 1237 0 3 4 0 10 0 + 1243 0 2 0 0 6 0 + 1244 0 2 0 0 6 0 + 1246 0 16 0 2 8 0 + 1247 0 13 5 2 0 0 + 1257 1 4 0 3 12 0 + 1258 1 0 0 + 0 15 0 0 17 0 2 11 0 + 0 16 0 + 1270 4 16 0 + 6 8 0 5 12 0 16 16 0 + 1286 0 2 8 + 0 16 0 0 9 4 1 8 0 + Total 35 9 3 + Average 2 19 1¼ + + 1287 0 3 4 0 10 0 + 1288 0 0 8 + 0 1 0 + 0 1 4 + 0 1 6 + 0 1 8 0 3 0¼ 0 9 1¾ + 0 2 0 + 0 3 4 + 0 9 4 + 1289 0 12 0 + 0 6 0 + 0 2 0 0 10 1½ 1 10 4½ + 0 10 8 + 1 0 0 + 1290 0 16 0 2 8 0 + 1294 0 16 0 2 8 0 + 1302 0 4 0 0 12 0 + 1309 0 7 2 1 1 6 + 1315 1 0 0 3 0 0 + 1316 1 0 0 + 1 10 0 1 10 6 4 11 6 + 1 12 0 + 2 0 0 + 1317 2 4 0 + 0 14 0 + 2 13 0 1 19 6 5 18 6 + 4 0 0 + 0 6 8 + 1336 0 2 0 0 6 0 + 1338 0 3 4 0 10 0 + Total 23 4 11¼ + Average 1 18 8 + + 1339 0 9 0 1 7 0 + 1349 0 2 0 0 5 2 + 1359 1 6 8 3 2 2 + 1361 0 2 0 0 4 8 + 1363 0 15 0 1 15 0 + 1369 1 0 0 + 1 4 0 1 2 0 2 9 4 + 1379 0 4 0 0 9 4 + 1387 0 2 0 0 4 8 + 1390 0 13 4 + 0 14 0 0 14 5 1 13 7 + 0 16 0 + 1401 0 16 0 1 17 6 + 1407 0 4 4¾ + 0 3 4 0 3 10 0 8 10 + 1416 0 16 0 1 12 0 + Total 15 9 4 + Average 1 5 9½ + + 1423 0 8 0 0 + 1425 0 4 0 0 + 1434 1 6 8 4 + 1435 0 5 4 8 + 1439 1 0 0 + 1 6 8 1 3 4 2 6 8 + 1440 1 4 0 2 8 0 + 1444 0 4 4 0 4 2 0 4 8 + 0 4 0 + 1445 0 4 6 0 9 0 + 1447 0 8 0 0 16 0 + 1448 0 6 8 0 13 4 + 1449 0 5 0 0 10 0 + 1451 0 8 0 0 16 0 + Total 12 15 4 + Average 1 1 3⅓ + + 1453 0 5 4 0 10 8 + 1455 0 1 2 0 2 4 + 1457 0 7 8 1 15 4 + 1459 0 5 0 0 10 0 + 1460 0 8 0 0 16 0 + 1463 0 2 0 0 1 10 0 3 8 + 0 1 8 + 1464 0 6 8 0 10 0 + 1486 1 4 0 1 17 0 + 1491 0 14 8 1 2 0 + 1494 0 4 0 0 6 0 + 1495 0 3 4 0 5 0 + 1497 1 0 0 1 11 0 + Total 8 9 0 + Average 0 14 1 + + 1499 0 4 0 0 6 0 + 1504 0 5 8 0 8 6 + 1521 1 0 0 1 10 0 + 1551 0 8 0 0 8 0 + 1553 0 8 0 0 8 0 + 1554 0 8 0 0 8 0 + 1555 0 8 0 0 8 0 + 1556 0 8 0 0 8 0 + 1557 0 8 0 + 0 4 0 0 17 8½ 0 17 8½ + 0 5 0 + 2 13 4 + 1558 0 8 0 0 8 0 + 1559 0 8 0 0 8 0 + 1560 0 8 0 0 8 0 + Total 6 0 2½ + Average 0 10 0½ + + 1561 0 8 0 0 8 0 + 1562 0 8 0 0 8 0 + 1574 2 16 0 + 1 4 0 2 0 0 2 0 0 + 1587 3 4 0 3 4 0 + 1594 2 16 0 2 16 0 + 1595 2 13 0 2 13 0 + 1596 4 0 0 4 0 0 + 1597 5 4 0 + 4 0 0 4 12 0 4 12 0 + 1598 2 16 8 2 16 8 + 1599 1 19 2 1 19 8 + 1600 1 17 8 1 17 8 + 1601 1 14 10 1 14 10 + Total 28 9 4 + Average 2 7 5½ + + + + PRICES OF THE QUARTER OF NINE BUSHELS OF THE BEST OR HIGHEST PRICED WHEAT + AT WINDSOR MARKET, ON LADY DAY AND MICHAELMAS, FROM 1595 TO 1764 BOTH + INCLUSIVE; THE PRICE OF EACH YEAR BEING THE MEDIUM BETWEEN THE HIGHEST + PRICES OF THESE TWO MARKET DAYS. + + + £ s d + 1595 2 0 0 + 1596 2 8 0 + 1597 3 9 6 + 1598 2 16 8 + 1599 1 19 2 + 1600 1 17 8 + 1601 1 14 10 + 1602 1 9 4 + 1603 1 15 4 + 1604 1 10 8 + 1605 1 15 10 + 1606 1 13 0 + 1607 1 16 8 + 1608 2 16 8 + 1609 2 10 0 + 1610 1 15 10 + 1611 1 18 8 + 1612 2 2 4 + 1613 2 8 8 + 1614 2 1 8½ + 1615 1 18 8 + 1616 2 0 4 + 1617 2 8 8 + 1618 2 6 8 + 1619 1 15 4 + 1620 1 10 4 + 26)54 0 6½ + Average 2 1 6¾ + + 1621 1 10 4 + 1622 2 18 8 + 1623 2 12 0 + 1624 2 8 0 + 1625 2 12 0 + 1626 2 9 4 + 1627 1 16 0 + 1628 1 8 0 + 1629 2 2 0 + 1630 2 15 8 + 1631 3 8 0 + 1632 2 13 4 + 1633 2 18 0 + 1634 2 16 0 + 1635 2 16 0 + 1636 2 16 8 + 16)40 0 0 + Average 2 10 0 + + 1637 2 13 0 + 1638 2 17 4 + 1639 2 4 10 + 1640 2 4 8 + 1641 2 8 0 + 1646 2 8 0 + 1647 3 13 0 + 1648 4 5 0 + 1649 4 0 0 + 1650 3 16 8 + 1651 3 13 4 + 1652 2 9 6 + 1653 1 15 6 + 1654 1 6 0 + 1655 1 13 4 + 1656 2 3 0 + 1657 2 6 8 + 1658 3 5 0 + 1659 3 6 0 + 1660 2 16 6 + 1661 3 10 0 + 1662 3 14 0 + 1663 2 17 0 + 1664 2 0 6 + 1665 2 9 4 + 1666 1 16 0 + 1667 1 16 0 + 1668 2 0 0 + 1669 2 4 4 + 1670 2 1 8 + 1671 2 2 0 + 1672 2 1 0 + 1673 2 6 8 + 1674 3 8 8 + 1675 3 4 8 + 1676 1 18 0 + 1677 2 2 0 + 1678 2 19 0 + 1679 3 0 0 + 1680 2 5 0 + 1681 2 6 8 + 1682 2 4 0 + 1683 2 0 0 + 1684 2 4 0 + 1685 2 6 8 + 1686 1 14 0 + 1687 1 5 2 + 1688 2 6 0 + 1689 1 10 0 + 1690 1 14 8 + 1691 1 14 0 + 1692 2 6 8 + 1693 3 7 8 + 1694 3 4 0 + 1695 2 13 0 + 1696 3 11 0 + 1697 3 0 0 + 1698 3 8 4 + 1699 3 4 0 + 1700 2 0 0 + 60) 153 1 8 + Average 2 11 0⅓ + + 1701 1 17 8 + 1702 1 9 6 + 1703 1 16 0 + 1704 2 6 6 + 1705 1 10 0 + 1706 1 6 0 + 1707 1 8 6 + 1708 2 1 6 + 1709 3 18 6 + 1710 3 18 0 + 1711 2 14 0 + 1712 2 6 4 + 1713 2 11 0 + 1714 2 10 4 + 1715 2 3 0 + 1716 2 8 0 + 1717 2 5 8 + 1718 1 18 10 + 1719 1 15 0 + 1720 1 17 0 + 1721 1 17 6 + 1722 1 16 0 + 1723 1 14 8 + 1724 1 17 0 + 1725 2 8 6 + 1726 2 6 0 + 1727 2 2 0 + 1728 2 14 6 + 1729 2 6 10 + 1730 1 16 6 + 1731 1 12 10 1 12 10 + 1732 1 6 8 1 6 8 + 1733 1 8 4 1 8 4 + 1734 1 18 10 1 18 10 + 1735 2 3 0 2 3 0 + 1736 2 0 4 2 0 4 + 1737 1 18 0 1 18 0 + 1738 1 15 6 1 15 6 + 1739 1 18 6 1 18 6 + 1740 2 10 8 2 10 8 + 10) 18 12 8 + 1 17 3½ + + 1741 2 6 8 2 6 8 + 1742 1 14 0 1 14 0 + 1743 1 4 10 1 4 10 + 1744 1 4 10 1 4 10 + 1745 1 7 6 1 7 6 + 1746 1 19 0 1 19 0 + 1747 1 14 10 1 14 10 + 1748 1 17 0 1 17 0 + 1749 1 17 0 1 17 0 + 1750 1 12 6 1 12 6 + 10) 16 18 2 + 1 13 9¾ + + 1751 1 18 6 + 1752 2 1 10 + 1753 2 4 8 + 1754 1 13 8 + 1755 1 14 10 + 1756 2 5 3 + 1757 3 0 0 + 1758 2 10 0 + 1759 1 19 10 + 1760 1 16 6 + 1761 1 10 3 + 1762 1 19 0 + 1763 2 0 9 + 1764 2 6 9 + 64) 129 13 6 + Average 2 0 6¾ + + +## Extracted Entities + +--- ENTITY: rent-of-land --- + +# Rent of Land + +## Definition + +The payment made by a tenant to a landlord for the use of land, representing the surplus value that the land generates beyond what is required to maintain the stock employed in cultivation and provide ordinary profits to the farmer. Rent is determined by what the tenant can afford to pay based on the productive capacity of the land, not by the landlord's investment in improvements. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +This is the central concept of the chapter, forming the foundation for Smith's analysis of how rent functions as a component of commodity prices and how it varies with different types of land and produce. The chapter systematically examines rent's nature, determinants, and relationship to other economic factors. + +## Economic Domain + +Distribution + +--- +--- ENTITY: natural rent of land --- + +# Natural Rent of Land + +## Definition + +The ordinary or typical rent that land commands in the market, determined by the surplus value that can be extracted from the land after maintaining the stock required for cultivation and providing ordinary profits to the farmer. This represents the price that land would naturally command in the absence of special circumstances or market distortions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith distinguishes between the natural rent that land would command under ordinary market conditions and the actual rent that may result from various circumstances. This concept helps explain the baseline against which other rent variations can be measured. + +## Economic Domain + +Distribution + +--- +--- ENTITY: monopoly price of land --- + +# Monopoly Price of Land + +## Definition + +The price paid for the use of land that exceeds what would be paid under competitive conditions, arising from the landlord's exclusive control over a particular piece of land. This price is determined by what the tenant can afford to pay rather than by the cost of providing the land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is essentially a monopoly price because it is not determined by the cost of providing the land but by what the tenant can afford to pay based on the land's productive capacity. This concept is crucial for understanding how rent differs from other forms of economic returns. + +## Economic Domain + +Distribution + +--- +--- ENTITY: corn rent --- + +# Corn Rent + +## Definition + +Rent paid in the form of a portion of the agricultural produce, particularly grain, rather than in money. This form of rent directly ties the landlord's income to the productivity of the land and the success of the harvest. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how rent can be paid either in kind (corn rent) or in money, and how this distinction affects the relationship between landlords and tenants. Corn rent provides a more direct connection between land productivity and landlord income. + +## Economic Domain + +Distribution + +--- +--- ENTITY: money rent --- + +# Money Rent + +## Definition + +Rent paid in monetary form rather than in agricultural produce. This represents the market value of the land's productive capacity expressed in currency terms. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the transition from corn rent to money rent affects the relationship between landlords and tenants, and how money rent provides a more flexible and standardized form of payment that can better reflect market conditions. + +## Economic Domain + +Distribution + +--- +--- ENTITY: unimproved land --- + +# Unimproved Land + +## Definition + +Land that has not been enhanced through human investment in drainage, fencing, clearing, or other improvements that increase its productive capacity. Even unimproved land can command rent based on its natural productive qualities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses examples of unimproved land, such as kelp-producing shores and uncultivated pastures, to demonstrate that rent is not solely a function of human improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- +--- ENTITY: improved land --- + +# Improved Land + +## Definition + +Land that has been enhanced through human investment in cultivation, drainage, fencing, clearing, or other modifications that increase its productive capacity beyond its natural state. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements to land affect its productive capacity and, consequently, the rent it can command. Improved land typically generates higher rents due to its increased productivity. + +## Economic Domain + +Production + +--- +--- ENTITY: pasture land --- + +# Pasture Land + +## Definition + +Land used primarily for grazing livestock, particularly cattle and sheep. The rent of pasture land is determined by its capacity to support animals and the market value of the livestock products it produces. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the rent of pasture land varies with its quality and location, and how it competes with corn land in the agricultural economy. He examines the factors that determine whether land is more profitably used for pasture or cultivation. + +## Economic Domain + +Production + +--- +--- ENTITY: corn land --- + +# Corn Land + +## Definition + +Land used for growing grain crops, particularly wheat and other cereals. The rent of corn land is determined by its productivity in grain production and the market price of grain. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how corn land serves as the baseline for determining rents of other types of land, as grain production is the most fundamental agricultural activity and provides the subsistence for most of the population. + +## Economic Domain + +Production + +--- +--- ENTITY: vineyard --- + +# Vineyard + +## Definition + +Land specifically cultivated for grape production to make wine. Vineyards often command premium rents due to the high value of wine and the limited geographical areas suitable for viticulture. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses vineyards as an example of land that can command exceptionally high rents due to the high value of its produce and the limited supply of suitable land. He discusses how vineyard rents are regulated by the profitability of corn production. + +## Economic Domain + +Production + +--- +--- ENTITY: kitchen garden --- + +# Kitchen Garden + +## Definition + +Land used for growing vegetables and herbs for household consumption. Kitchen gardens require intensive cultivation and can command higher rents per unit area than field crops due to their high value relative to the land they occupy. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses kitchen gardens as an example of high-value agricultural production that can justify intensive cultivation and higher rents, particularly when located near urban markets where fresh produce commands premium prices. + +## Economic Domain + +Production + +--- +--- ENTITY: hop garden --- + +# Hop Garden + +## Definition + +Land specifically cultivated for growing hops, used primarily in beer production. Hop gardens represent a specialized form of agriculture that can command higher rents due to the value of the crop and the intensive cultivation required. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses hop gardens as an example of specialized agricultural production that requires more investment and care than general field crops, and therefore can command higher rents and profits. + +## Economic Domain + +Production + +--- +--- ENTITY: fruit garden --- + +# Fruit Garden + +## Definition + +Land used for growing fruit trees and bushes. Fruit gardens represent a long-term investment in agriculture that can command premium rents due to the high value of fruit relative to the land required for its production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses fruit gardens as another example of specialized agricultural production that can justify higher rents due to the value of the produce and the care required for successful cultivation. + +## Economic Domain + +Production + +--- +--- ENTITY: fruit-wall --- + +# Fruit-Wall + +## Definition + +A wall constructed around a kitchen garden or orchard to protect fruit trees from wind and to create a warmer microclimate that extends the growing season. The cost of building and maintaining fruit-walls is justified by the higher value of the protected fruit production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses fruit-walls as an example of agricultural improvements that increase the value of land by enabling the production of higher-value crops that would not otherwise be viable in the local climate. + +## Economic Domain + +Production + +--- +--- ENTITY: sugar colonies --- + +# Sugar Colonies + +## Definition + +Plantations in tropical regions, particularly in the West Indies, that produce sugar cane for export to European markets. These colonies represent a form of specialized agricultural production that commands exceptionally high profits and rents due to the high value of sugar and the limited geographical areas suitable for its cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses sugar colonies as an extreme example of land that can command rents far exceeding those of ordinary agricultural land, due to the combination of high-value production and limited suitable territory. + +## Economic Domain + +Production + +--- +--- ENTITY: tobacco colonies --- + +# Tobacco Colonies + +## Definition + +Plantations in North America, particularly Virginia and Maryland, that produce tobacco for export to European markets. Tobacco cultivation represents a specialized form of agriculture that can command high rents due to the value of the crop and the limited suitable land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses tobacco colonies as another example of specialized agricultural production that can command rents exceeding those of ordinary agricultural land, though typically not as high as sugar colonies due to greater competition and more widely available suitable land. + +## Economic Domain + +Production + +--- +--- ENTITY: rice countries --- + +# Rice Countries + +## Definition + +Regions where rice is the primary agricultural product and staple food, such as parts of Asia and the American South. Rice cultivation typically requires specific environmental conditions and intensive labor, leading to different economic dynamics than wheat-producing regions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses rice countries to illustrate how the nature of the primary agricultural product affects the distribution of economic returns, particularly how rice cultivation can support higher rents due to its high productivity per acre. + +## Economic Domain + +Production + +--- +--- ENTITY: potato cultivation --- + +# Potato Cultivation + +## Definition + +The agricultural practice of growing potatoes as a staple food crop. Potato cultivation can support higher population densities and potentially higher rents than grain cultivation due to its higher productivity per acre and nutritional value. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses potato cultivation as a potentially revolutionary agricultural practice that could support larger populations and higher rents than traditional grain cultivation, though he notes the practical difficulties of storage and preservation. + +## Economic Domain + +Production + +--- +--- ENTITY: artificial grasses --- + +# Artificial Grasses + +# Turnips + +# Carrots + +# Cabbages + +## Definition + +Cultivated forage crops, including clover and other legumes, as well as root vegetables like turnips, carrots, and cabbages, that can be grown to feed livestock during seasons when natural pasture is unavailable. These crops increase the productivity of pasture land by enabling year-round animal husbandry. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the introduction of artificial grasses and root crops has affected the relative prices of butcher's meat and bread, demonstrating how agricultural innovations can change the economic relationships between different types of production. + +## Economic Domain + +Production + +--- +--- ENTITY: inclosure --- + +# Inclosure + +## Definition + +The practice of surrounding land with fences, hedges, or walls to create defined agricultural units. Inclosure increases the productivity of land by enabling better control of livestock, more intensive cultivation, and protection of crops from damage. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how inclosure affects land rents and agricultural productivity, arguing that it is particularly beneficial for pasture land and that the high rents currently commanded by inclosed land in Scotland are due to temporary scarcity rather than permanent advantage. + +## Economic Domain + +Production + +--- +--- ENTITY: public fiars --- + +# Public Fiars + +## Definition + +Official annual valuations of grain prices conducted by assize courts in Scotland to establish fair prices for various grains and qualities. These valuations provided a standardized basis for converting corn rents to money rents and for other legal and commercial purposes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith mentions public fiars as an example of how governments have attempted to regulate grain prices and provide stability in agricultural markets, though he generally favors market-determined prices over official valuations. + +## Economic Domain + +Regulation + +--- +--- ENTITY: conversion price --- + +# Conversion Price + +## Definition + +The price at which agricultural produce, particularly grain, could be converted from payment in kind to payment in money under Scottish agricultural tenancy agreements. This price was typically set below market rates to protect tenants from excessive charges. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses conversion prices as an example of how agricultural rents were historically structured and how they affected the relationship between landlords and tenants in Scotland. + +## Economic Domain + +Distribution + +--- +--- ENTITY: statute of labourers --- + +# Statute of Labourers + +## Definition + +The English law enacted in 1351 during the reign of Edward III that attempted to regulate wages and prices following the labor shortages caused by the Black Death. The statute set maximum wages and prices for various goods and services. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith references the Statute of Labourers as historical evidence of grain prices in the 14th century, using it to trace the changes in the value of silver relative to corn over time. + +## Economic Domain + +Regulation + +--- +--- ENTITY: assize of bread and ale --- + +# Assize of Bread and Ale + +## Definition + +Medieval English regulations that set the prices of bread and ale based on the prices of wheat and barley. These statutes attempted to maintain stable prices for essential food items by adjusting their prices according to grain market conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the assize of bread and ale as another historical example of price regulation, using it to trace the changes in grain prices and the value of silver over time. + +## Economic Domain + +Regulation + +--- +--- ENTITY: exportation bounty --- + +# Exportation Bounty + +## Definition + +A government subsidy paid to encourage the export of grain, particularly wheat. The bounty was designed to support agricultural prices and encourage production by making exports more profitable. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the bounty on grain exports affected domestic grain prices and agricultural production, arguing that it raised prices in the home market and may have discouraged rather than encouraged tillage in the long run. + +## Economic Domain + +Regulation + +--- +--- ENTITY: kelp --- + +# Kelp + +## Definition + +A type of seaweed that, when burned, produces an alkaline salt used in glassmaking, soap production, and other industrial processes. Kelp grows on rocky shores within the high-water mark and can be harvested without cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses kelp as an example of a natural product that can command rent even though it requires no human improvement, demonstrating that rent is not solely a function of agricultural improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- +--- ENTITY: wood price --- + +# Wood Price + +## Definition + +The market price of timber and firewood, which varies with the state of agriculture and population density. As agriculture advances and reduces forest land, the price of wood typically rises due to increased scarcity. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the price of wood serves as an alternative fuel source to coal and how changes in wood prices affect the demand for coal and the rents of coal mines. + +## Economic Domain + +Production + +--- +--- ENTITY: coal price --- + +# Coal Price + +## Definition + +The market price of coal, which is influenced by its abundance, transportation costs, and the availability of alternative fuels. Coal prices tend to be lower in coal-producing regions and higher in areas dependent on imported coal. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes coal prices as an example of how the rent component in commodity prices varies with the natural abundance of resources, arguing that coal rents are typically lower than rents for agricultural land due to the greater abundance of coal mines. + +## Economic Domain + +Production + +--- +--- ENTITY: silver price variation --- + +# Silver Price Variation + +## Definition + +The changes over time in the value of silver relative to other commodities, particularly corn. These variations reflect changes in the supply of silver from mines and changes in the demand for silver as commerce and wealth increase. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith provides a detailed analysis of how the value of silver has changed relative to corn over the past four centuries, using this as evidence for his theories about the relationship between wealth, commerce, and the value of precious metals. + +## Economic Domain + +Exchange + +--- +--- ENTITY: gold price variation --- + +# Gold Price Variation + +## Definition + +The changes over time in the value of gold relative to silver and other commodities. These variations are influenced by the relative abundance of gold and silver mines and the different uses to which the metals are put. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the relative values of gold and silver have changed over time, particularly after the discovery of American mines, and how this affects their use in different economic functions. + +## Economic Domain + +Exchange + +--- +--- ENTITY: precious metals consumption --- + +# Precious Metals Consumption + +## Definition + +The use of gold and silver in various forms including coin, plate, jewelry, and industrial applications. This consumption creates ongoing demand for newly mined precious metals to replace losses from wear, damage, and industrial use. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the consumption of precious metals in various forms creates a continuous demand that must be met by new production, affecting their long-term value and availability. + +## Economic Domain + +Consumption + +--- +--- ENTITY: annual consumption of metals --- + +# Annual Consumption of Metals + +## Definition + +The total amount of gold and silver used up each year through wear, damage, industrial processes, and other forms of consumption that remove these metals from circulation or usable form. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the annual consumption of precious metals must be balanced by new production to maintain stable supplies, and how this consumption affects their long-term value. + +## Economic Domain + +Consumption + +--- +--- ENTITY: mine fertility --- + +# Mine Fertility + +## Definition + +The productivity of a mineral mine in terms of the quantity of valuable material that can be extracted per unit of labor and capital invested. Mine fertility varies significantly between different mines and affects the price and rent of the extracted minerals. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses the concept of mine fertility to explain why the rent component in mineral prices is typically lower than in agricultural products, as mineral deposits are generally more abundant and less geographically concentrated than fertile agricultural land. + +## Economic Domain + +Production + +--- +--- ENTITY: mine situation --- + +# Mine Situation + +## Definition + +The geographical location of a mineral mine and its accessibility to markets and transportation infrastructure. Mine situation can significantly affect the cost of production and the price that can be obtained for the extracted minerals. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that for mineral extraction, the situation of the mine is often more important than its fertility in determining profitability, as transportation costs can significantly affect the competitiveness of mineral products in distant markets. + +## Economic Domain + +Production + +--- +--- ENTITY: landlord's share --- + +# Landlord's Share + +## Definition + +The portion of the total produce from land that goes to the landlord as rent, distinct from the portions that go to the farmer as profit and to laborers as wages. The landlord's share increases with the productivity of the land and the efficiency of cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the landlord's share of agricultural produce is determined by the surplus value created by the land after all necessary costs of production have been met, and how this share varies with different types of land and agricultural practices. + +## Economic Domain + +Distribution + +--- +--- ENTITY: farmer's profit --- + +# Farmer's Profit + +## Definition + +The return to the agricultural entrepreneur for the use of capital and management in farming operations. This profit must be sufficient to compensate for the risk and effort involved in cultivation and to provide a return comparable to other forms of investment. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how farmers' profits are determined by the productivity of the land and the efficiency of cultivation, and how these profits must be sufficient to maintain and improve the stock employed in agriculture. + +## Economic Domain + +Distribution + +--- +--- ENTITY: agricultural stock --- + +# Agricultural Stock + +## Definition + +The capital invested in farming operations, including livestock, implements, seeds, and other materials necessary for cultivation. This stock must be maintained and renewed to ensure continued agricultural production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the maintenance and improvement of agricultural stock is essential for continued productivity and how the returns from farming must be sufficient to maintain this stock while providing profits to the farmer and rent to the landlord. + +## Economic Domain + +Production + +--- +--- ENTITY: labouring cattle --- + +# Labouring Cattle + +## Definition + +Animals used for agricultural work, particularly oxen and horses that pull plows and perform other farm tasks. The cost of maintaining labouring cattle is a significant component of agricultural expenses. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the cost and availability of labouring cattle affect agricultural productivity and how improvements in cattle breeding and feeding can increase the efficiency of farming operations. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural improvement --- + +# Agricultural Improvement + +## Definition + +Enhancements to farming practices and land productivity through better cultivation techniques, crop rotation, drainage, fencing, and other methods that increase the yield and value of agricultural land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural improvements increase land productivity and rents, and how the benefits of these improvements are distributed between landlords, farmers, and consumers. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural cultivation --- + +# Agricultural Cultivation + +## Definition + +The practice of preparing and using land for growing crops and raising livestock. Cultivation includes all activities from soil preparation to harvest and requires significant labor and capital investment. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how different levels of cultivation affect land productivity and rents, and how the extension of cultivation influences agricultural prices and the distribution of economic returns. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural surplus --- + +# Agricultural Surplus + +## Definition + +The excess produce from agricultural land beyond what is required to maintain the farmers, laborers, and livestock necessary for cultivation. This surplus forms the basis for rent payments to landlords and supports non-agricultural economic activities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is fundamentally based on agricultural surplus, as it represents the portion of production that remains after all necessary costs of cultivation have been met. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural demand --- + +# Agricultural Demand + +## Definition + +The market demand for agricultural products, which determines the prices that farmers can obtain for their produce and consequently affects the rents that agricultural land can command. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how changes in agricultural demand, whether from population growth, changes in consumption patterns, or improvements in transportation, affect agricultural prices and rents. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural supply --- + +# Agricultural Supply + +## Definition + +The quantity of agricultural products available in the market, determined by the extent of cultivation, weather conditions, and other factors affecting production. Agricultural supply directly influences market prices and rents. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how variations in agricultural supply, whether from seasonal conditions or longer-term changes in cultivation practices, affect agricultural prices and the distribution of economic returns. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural productivity --- + +# Agricultural Productivity + +## Definition + +The efficiency with which agricultural land produces crops and livestock, typically measured as output per unit of land or per unit of labor. Agricultural productivity is a key determinant of land rents and agricultural profits. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in agricultural productivity through better techniques and technologies increase land rents and reduce the real cost of food, supporting broader economic development. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural efficiency --- + +# Agricultural Efficiency + +## Definition + +The effectiveness with which agricultural resources are used to produce desired outputs, including the optimal allocation of land, labor, and capital in farming operations. Agricultural efficiency affects both productivity and profitability. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements in agricultural efficiency through better management and technology increase the surplus available for rent and support economic growth. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural technology --- + +# Agricultural Technology + +## Definition + +The tools, techniques, and methods used in farming operations, including implements, crop varieties, cultivation practices, and management systems. Agricultural technology determines the productivity and efficiency of agricultural production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in agricultural technology increase productivity and rents, and how the adoption of new technologies varies with economic conditions and market incentives. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural market integration --- + +# Agricultural Market Integration + +## Definition + +The degree to which different agricultural markets are connected through trade and transportation, allowing prices to equalize across regions and enabling more efficient allocation of agricultural resources. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements in transportation and trade integration affect agricultural markets, enabling regions to specialize in their most productive activities and increasing overall economic efficiency. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural specialization --- + +# Agricultural Specialization + +## Definition + +The concentration of agricultural production on specific crops or livestock that are best suited to local conditions, enabled by market integration and transportation improvements. Agricultural specialization increases productivity and economic efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural specialization, facilitated by market integration, allows regions to focus on their most productive activities and increases overall economic efficiency and productivity. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural comparative advantage --- + +# Agricultural Comparative Advantage + +## Definition + +The relative efficiency with which different regions can produce various agricultural products, determined by natural conditions, accumulated knowledge, and existing capital investments. Agricultural comparative advantage guides the international division of labor in farming. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how different regions have natural advantages for producing different agricultural products, and how market forces guide the specialization of agricultural production to maximize overall efficiency. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural trade --- + +# Agricultural Trade + +## Definition + +The exchange of agricultural products between different regions or countries, enabled by transportation infrastructure and market institutions. Agricultural trade allows regions to access products they cannot efficiently produce themselves. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural trade affects domestic agricultural markets, influences land rents, and contributes to overall economic development by enabling regions to specialize according to their comparative advantages. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price mechanism --- + +# Agricultural Price Mechanism + +## Definition + +The market process through which agricultural prices are determined by the interaction of supply and demand, signaling information about scarcity and abundance to producers and consumers. Agricultural price mechanisms guide resource allocation in farming. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price mechanisms function to allocate resources efficiently, though he notes that government interventions like bounties and price regulations can distort these mechanisms and reduce economic efficiency. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price regulation --- + +# Agricultural Price Regulation + +## Definition + +Government interventions in agricultural markets aimed at controlling prices through mechanisms such as price floors, ceilings, or stabilization schemes. Agricultural price regulation can affect production incentives and market efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines various forms of agricultural price regulation, including the Statute of Labourers and the Assize of Bread and Ale, arguing that such interventions often reduce economic efficiency and harm the interests they aim to protect. + +## Economic Domain + +Regulation + +--- +--- ENTITY: agricultural price stability --- + +# Agricultural Price Stability + +## Definition + +The degree to which agricultural prices remain relatively constant over time, unaffected by short-term fluctuations in supply or demand. Agricultural price stability can be pursued through various policy interventions and market mechanisms. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the desirability and feasibility of agricultural price stability, arguing that attempts to stabilize prices often create more problems than they solve and that market-determined prices better serve long-term economic interests. + +## Economic Domain + +Regulation + +--- +--- ENTITY: agricultural price volatility --- + +# Agricultural Price Volatility + +## Definition + +The degree to which agricultural prices fluctuate over time due to changes in supply, demand, weather conditions, and other factors affecting production and consumption. Agricultural price volatility can create uncertainty for producers and consumers. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines the causes and consequences of agricultural price volatility, arguing that while short-term fluctuations can be disruptive, long-term price trends reflect fundamental economic conditions and should not be artificially suppressed. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price discovery --- + +# Agricultural Price Discovery + +## Definition + +The process by which market prices for agricultural products are established through the interaction of buyers and sellers, reflecting information about supply, demand, and production costs. Agricultural price discovery enables efficient resource allocation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price discovery functions in different market conditions and how government interventions can interfere with this process, reducing the efficiency of agricultural markets. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price transmission --- + +# Agricultural Price Transmission + +## Definition + +The process by which price changes in one agricultural market or region affect prices in other markets, facilitated by trade and transportation. Agricultural price transmission enables markets to respond to changes in supply and demand conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in transportation and market integration affect agricultural price transmission, enabling more efficient resource allocation and reducing regional price disparities. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price discrimination --- + +# Agricultural Price Discrimination + +## Definition + +The practice of charging different prices for the same agricultural product in different markets or to different customers, based on their willingness or ability to pay. Agricultural price discrimination can increase seller profits but may reduce economic efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price discrimination occurs in different markets and how transportation costs and market conditions affect the ability of sellers to practice price discrimination. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price elasticity --- + +# Agricultural Price Elasticity + +## Definition + +The responsiveness of agricultural supply and demand to changes in prices, measured as the percentage change in quantity supplied or demanded divided by the percentage change in price. Agricultural price elasticity affects how markets respond to price changes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural supply and demand respond to price changes over different time periods, noting that supply is typically less elastic in the short run due to the biological constraints of agricultural production. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price floors --- + +# Agricultural Price Floors + +## Definition + +Minimum prices set by government for agricultural products, typically above market equilibrium levels, intended to support producer incomes. Agricultural price floors can lead to surpluses and market inefficiencies. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses various forms of agricultural price support, including the bounty on grain exports, arguing that such interventions often create more problems than they solve and reduce overall economic efficiency. + +## Economic Domain + +Regulation + +--- +--- ENTITY: agricultural price ceilings --- + +# Agricultural Price Ceilings + +## Definition + +Maximum prices set by government for agricultural products, typically below market equilibrium levels, intended to protect consumer interests. Agricultural price ceilings can lead to shortages and reduced quality. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines historical examples of agricultural price ceilings, including the Statute of Labourers, arguing that such interventions often harm the very groups they aim to protect and reduce economic efficiency. + +## Economic Domain + +Regulation + + + +## VSM Mappings + +--- MAPPING: rent-of-land-to-S1 --- +# rent-of-land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: rent-of-land --- + +# Rent of Land + +## Definition + +The payment made by a tenant to a landlord for the use of land, representing the surplus value that the land generates beyond what is required to maintain the stock employed in cultivation and provide ordinary profits to the farmer. Rent is determined by what the tenant can afford to pay based on the productive capacity of the land, not by the landlord's investment in improvements. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +This is the central concept of the chapter, forming the foundation for Smith's analysis of how rent functions as a component of commodity prices and how it varies with different types of land and produce. The chapter systematically examines rent's nature, determinants, and relationship to other economic factors. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Rent of land represents the operational output of agricultural land as a productive unit. In Smith's analysis, land functions as an autonomous operational element that directly produces value through its natural productive capacity. The rent payment is the mechanism by which the surplus value created by this operational unit is distributed, making land itself the primary value-producing entity within the agricultural economy. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: rent-of-land-to-S3 --- +# rent-of-land -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: rent-of-land --- + +# Rent of Land + +## Definition + +The payment made by a tenant to a landlord for the use of land, representing the surplus value that the land generates beyond what is required to maintain the stock employed in cultivation and provide ordinary profits to the farmer. Rent is determined by what the tenant can afford to pay based on the productive capacity of the land, not by the landlord's investment in improvements. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +This is the central concept of the chapter, forming the foundation for Smith's analysis of how rent functions as a component of commodity prices and how it varies with different types of land and produce. The chapter systematically examines rent's nature, determinants, and relationship to other economic factors. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Rent of land functions as a regulatory mechanism that controls the allocation of agricultural resources within the economic system. It establishes the rules and rights governing land use, determines the distribution of surplus value, and creates incentives for optimal land management. The rent mechanism acts as an internal regulatory system that optimises the use of land resources across the economy. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: natural rent of land-to-S3 --- +# natural rent of land -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: natural rent of land --- + +# Natural Rent of Land + +## Definition + +The ordinary or typical rent that land commands in the market, determined by the surplus value that can be extracted from the land after maintaining the stock required for cultivation and providing ordinary profits to the farmer. This represents the price that land would naturally command in the absence of special circumstances or market distortions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith distinguishes between the natural rent that land would command under ordinary market conditions and the actual rent that may result from various circumstances. This concept helps explain the baseline against which other rent variations can be measured. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Natural rent of land serves as the baseline regulatory framework for land resource allocation in the economic system. It represents the standard control mechanism that would operate in the absence of market distortions, providing a reference point for optimal resource distribution. This concept functions as the internal regulatory standard against which actual market conditions are measured and managed. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: monopoly price of land-to-S3 --- +# monopoly price of land -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: monopoly price of land --- + +# Monopoly Price of Land + +## Definition + +The price paid for the use of land that exceeds what would be paid under competitive conditions, arising from the landlord's exclusive control over a particular piece of land. This price is determined by what the tenant can afford to pay rather than by the cost of providing the land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is essentially a monopoly price because it is not determined by the cost of providing the land but by what the tenant can afford to pay based on the land's productive capacity. This concept is crucial for understanding how rent differs from other forms of economic returns. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Monopoly price of land represents a distortion in the internal regulatory mechanism of the economic system. It shows how exclusive control over resources can create regulatory failures where the standard control mechanisms (natural rent) are overridden by monopolistic power. This concept highlights the need for higher-level regulatory intervention to correct market failures and restore optimal resource allocation. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: corn rent-to-S1 --- +# corn rent -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: corn rent --- + +# Corn Rent + +## Definition + +Rent paid in the form of a portion of the agricultural produce, particularly grain, rather than in money. This form of rent directly ties the landlord's income to the productivity of the land and the success of the harvest. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how rent can be paid either in kind (corn rent) or in money, and how this distinction affects the relationship between landlords and tenants. Corn rent provides a more direct connection between land productivity and landlord income. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Corn rent represents the direct operational output of agricultural land as a productive unit. It embodies the principle that land as an operational element produces tangible value that can be directly distributed as rent. This form of rent maintains the connection between the operational productivity of land and the economic returns it generates, functioning as a pure expression of land's productive capacity. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: money rent-to-S2 --- +# money rent -> S2 (Coordination) + +## Economic Entity Reference + +--- ENTITY: money rent --- + +# Money Rent + +## Definition + +Rent paid in monetary form rather than in agricultural produce. This represents the market value of the land's productive capacity expressed in currency terms. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the transition from corn rent to money rent affects the relationship between landlords and tenants, and how money rent provides a more flexible and standardized form of payment that can better reflect market conditions. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in System 1 to communicate with each other and that allow System 3 to monitor and coordinate activities. System 2 dampens oscillations and resolves conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict resolution, standardisation. + +--- + +## Mapping Rationale + +Money rent functions as a coordination mechanism that standardizes the value of land across different agricultural operations and regions. By expressing rent in monetary terms, it creates a common language for comparing and coordinating land values, dampening the oscillations that would occur if rents were paid in kind. This standardization enables more efficient resource allocation and market coordination. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: unimproved land-to-S1 --- +# unimproved land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: unimproved land --- + +# Unimproved Land + +## Definition + +Land that has not been enhanced through human investment in drainage, fencing, clearing, or other improvements that increase its productive capacity. Even unimproved land can command rent based on its natural productive qualities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses examples of unimproved land, such as kelp-producing shores and uncultivated pastures, to demonstrate that rent is not solely a function of human improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Unimproved land represents an autonomous operational unit that produces value through its natural productive capacity without human intervention. It demonstrates that operational value creation can occur through natural processes rather than just through human-directed activities. This concept shows how operational units in the economic system can function based on inherent properties rather than constructed improvements. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: improved land-to-S1 --- +# improved land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: improved land --- + +# Improved Land + +## Definition + +Land that has been enhanced through human investment in cultivation, drainage, fencing, clearing, or other modifications that increase its productive capacity beyond its natural state. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements to land affect its productive capacity and, consequently, the rent it can command. Improved land typically generates higher rents due to its increased productivity. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Improved land represents an enhanced operational unit whose productivity has been increased through human intervention. It demonstrates how operational units can be optimized through investment and modification to produce greater value. The improvements function as operational enhancements that increase the unit's capacity to create surplus value, which is then reflected in higher rents. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: pasture land-to-S1 --- +# pasture land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: pasture land --- + +# Pasture Land + +## Definition + +Land used primarily for grazing livestock, particularly cattle and sheep. The rent of pasture land is determined by its capacity to support animals and the market value of the livestock products it produces. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the rent of pasture land varies with its quality and location, and how it competes with corn land in the agricultural economy. He examines the factors that determine whether land is more profitably used for pasture or cultivation. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Pasture land functions as an autonomous operational unit that produces value through livestock grazing operations. It represents a specialized form of agricultural production that directly creates economic output through natural biological processes. The rent mechanism coordinates the allocation of this operational resource based on its productive capacity and market conditions. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: corn land-to-S1 --- +# corn land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: corn land --- + +# Corn Land + +## Definition + +Land used for growing grain crops, particularly wheat and other cereals. The rent of corn land is determined by its productivity in grain production and the market price of grain. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how corn land serves as the baseline for determining rents of other types of land, as grain production is the most fundamental agricultural activity and provides the subsistence for most of the population. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Corn land represents the fundamental operational unit of agricultural production, serving as the baseline reference for all other agricultural operations. Its productivity directly determines the subsistence capacity of the economy and provides the foundation for all other economic activities. The rent mechanism for corn land establishes the standard by which all other land rents are measured and coordinated. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: vineyard-to-S1 --- +# vineyard -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: vineyard --- + +# Vineyard + +## Definition + +Land specifically cultivated for grape production to make wine. Vineyards often command premium rents due to the high value of wine and the limited geographical areas suitable for viticulture. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses vineyards as an example of land that can command exceptionally high rents due to the high value of its produce and the limited supply of suitable land. He discusses how vineyard rents are regulated by the profitability of corn production. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Vineyard represents a specialized operational unit that produces high-value output through specific agricultural processes. Its autonomous operation creates premium value that exceeds standard agricultural production, demonstrating how specialized operational units can command higher returns based on their unique productive characteristics and market position. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: kitchen garden-to-S1 --- +# kitchen garden -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: kitchen garden --- + +# Kitchen Garden + +## Definition + +Land used for growing vegetables and herbs for household consumption. Kitchen gardens require intensive cultivation and can command higher rents per unit area than field crops due to their high value relative to the land they occupy. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses kitchen gardens as an example of high-value agricultural production that can justify intensive cultivation and higher rents, particularly when located near urban markets where fresh produce commands premium prices. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Kitchen garden functions as an intensive operational unit that maximizes value production per unit of land through specialized cultivation techniques. It demonstrates how operational units can optimize their productive capacity through focused specialization and proximity to high-value markets, creating premium returns that justify higher resource allocation. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: hop garden-to-S1 --- +# hop garden -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: hop garden --- + +# Hop Garden + +## Definition + +Land specifically cultivated for growing hops, used primarily in beer production. Hop gardens represent a specialized form of agriculture that can command higher rents due to the value of the crop and the intensive cultivation required. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses hop gardens as an example of specialized agricultural production that requires more investment and care than general field crops, and therefore can command higher rents and profits. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Hop garden represents a specialized operational unit focused on producing a specific high-value input for another industry. It demonstrates how operational units can create premium value through specialization and intensive cultivation, with the rent mechanism coordinating the allocation of land resources to their most productive specialized uses. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: fruit garden-to-S1 --- +# fruit garden -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: fruit garden --- + +# Fruit Garden + +## Definition + +Land used for growing fruit trees and bushes. Fruit gardens represent a long-term investment in agriculture that can command premium rents due to the high value of fruit relative to the land required for its production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses fruit gardens as another example of specialized agricultural production that can justify higher rents due to the value of the produce and the care required for successful cultivation. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Fruit garden functions as a long-term operational unit that produces high-value output through specialized cultivation requiring significant investment and care. It demonstrates how operational units can create premium value through patient capital investment and specialized knowledge, with the rent mechanism coordinating the allocation of resources to these high-value specialized operations. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: fruit-wall-to-S1 --- +# fruit-wall -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: fruit-wall --- + +# Fruit-Wall + +## Definition + +A wall constructed around a kitchen garden or orchard to protect fruit trees from wind and to create a warmer microclimate that extends the growing season. The cost of building and maintaining fruit-walls is justified by the higher value of the protected fruit production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses fruit-walls as an example of agricultural improvements that increase the value of land by enabling the production of higher-value crops that would not otherwise be viable in the local climate. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Fruit-wall represents an operational enhancement that increases the productive capacity of agricultural units by modifying their environmental conditions. It demonstrates how operational units can be optimized through infrastructure investment to produce higher-value outputs, with the rent mechanism coordinating the allocation of resources to these productivity-enhancing improvements. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: sugar colonies-to-S1 --- +# sugar colonies -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: sugar colonies --- + +# Sugar Colonies + +## Definition + +Plantations in tropical regions, particularly in the West Indies, that produce sugar cane for export to European markets. These colonies represent a form of specialized agricultural production that commands exceptionally high profits and rents due to the high value of sugar and the limited geographical areas suitable for its cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses sugar colonies as an extreme example of land that can command rents far exceeding those of ordinary agricultural land, due to the combination of high-value production and limited suitable territory. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Sugar colonies function as highly specialized operational units that produce exceptional value through unique geographical advantages and specialized cultivation. They demonstrate how operational units in specific locations can create premium value through natural advantages combined with intensive production methods, with the rent mechanism coordinating the allocation of these scarce high-value resources. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: tobacco colonies-to-S1 --- +# tobacco colonies -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: tobacco colonies --- + +# Tobacco Colonies + +## Definition + +Plantations in North America, particularly Virginia and Maryland, that produce tobacco for export to European markets. Tobacco cultivation represents a specialized form of agriculture that can command high rents due to the value of the crop and the limited suitable land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses tobacco colonies as another example of specialized agricultural production that can command rents exceeding those of ordinary agricultural land, though typically not as high as sugar colonies due to greater competition and more widely available suitable land. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Tobacco colonies represent specialized operational units that produce high-value agricultural products for export markets. They demonstrate how operational units can create premium value through specialized cultivation of high-demand products, with the rent mechanism coordinating the allocation of land resources to these specialized production activities based on their market value and geographical constraints. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: rice countries-to-S1 --- +# rice countries -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: rice countries --- + +# Rice Countries + +## Definition + +Regions where rice is the primary agricultural product and staple food, such as parts of Asia and the American South. Rice cultivation typically requires specific environmental conditions and intensive labor, leading to different economic dynamics than wheat-producing regions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses rice countries to illustrate how the nature of the primary agricultural product affects the distribution of economic returns, particularly how rice cultivation can support higher rents due to its high productivity per acre. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Rice countries function as specialized operational regions where the primary economic activity is focused on rice production. They demonstrate how operational units at the regional level can specialize in specific productive activities based on environmental conditions and create distinct economic dynamics through their specialized focus, with the rent mechanism coordinating resource allocation across these specialized regions. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: potato cultivation-to-S1 --- +# potato cultivation -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: potato cultivation --- + +# Potato Cultivation + +## Definition + +The agricultural practice of growing potatoes as a staple food crop. Potato cultivation can support higher population densities and potentially higher rents than grain cultivation due to its higher productivity per acre and nutritional value. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses potato cultivation as a potentially revolutionary agricultural practice that could support larger populations and higher rents than traditional grain cultivation, though he notes the practical difficulties of storage and preservation. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Potato cultivation represents an innovative operational practice that increases agricultural productivity through more efficient use of land resources. It demonstrates how operational units can adopt new productive methods to create greater value, with the rent mechanism coordinating the allocation of land to these more productive cultivation practices based on their superior efficiency and output. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: artificial grasses-to-S1 --- +# artificial grasses -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: artificial grasses --- + +# Artificial Grasses + +# Turnips + +# Carrots + +# Cabbages + +## Definition + +Cultivated forage crops, including clover and other legumes, as well as root vegetables like turnips, carrots, and cabbages, that can be grown to feed livestock during seasons when natural pasture is unavailable. These crops increase the productivity of pasture land by enabling year-round animal husbandry. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the introduction of artificial grasses and root crops has affected the relative prices of butcher's meat and bread, demonstrating how agricultural innovations can change the economic relationships between different types of production. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Artificial grasses and root crops function as operational enhancements that increase the productivity of agricultural units by extending the productive capacity of pasture land. They demonstrate how operational units can be optimized through crop diversification and innovation to produce greater value throughout the year, with the rent mechanism coordinating the allocation of resources to these productivity-enhancing practices. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: inclosure-to-S1 --- +# inclosure -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: inclosure --- + +# Inclosure + +## Definition + +The practice of surrounding land with fences, hedges, or walls to create defined agricultural units. Inclosure increases the productivity of land by enabling better control of livestock, more intensive cultivation, and protection of crops from damage. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how inclosure affects land rents and agricultural productivity, arguing that it is particularly beneficial for pasture land and that the high rents currently commanded by inclosed land in Scotland are due to temporary scarcity rather than permanent advantage. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Inclosure represents an operational infrastructure improvement that increases the productivity of agricultural units by creating better-defined and controlled production environments. It demonstrates how operational units can be enhanced through physical infrastructure to produce greater value, with the rent mechanism coordinating the allocation of resources to these productivity-enhancing improvements. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: public fiars-to-S2 --- +# public fiars -> S2 (Coordination) + +## Economic Entity Reference + +--- ENTITY: public fiars --- + +# Public Fiars + +## Definition + +Official annual valuations of grain prices conducted by assize courts in Scotland to establish fair prices for various grains and qualities. These valuations provided a standardized basis for converting corn rents to money rents and for other legal and commercial purposes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith mentions public fiars as an example of how governments have attempted to regulate grain prices and provide stability in agricultural markets, though he generally favors market-determined prices over official valuations. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in System 1 to communicate with each other and that allow System 3 to monitor and coordinate activities. System 2 dampens oscillations and resolves conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict resolution, standardisation. + +--- + +## Mapping Rationale + +Public fiars function as a coordination mechanism that standardizes grain prices across different regions and time periods. By providing official price valuations, they create a common reference point that dampens price oscillations and resolves conflicts in grain markets, enabling more efficient coordination of agricultural production and distribution. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: conversion price-to-S2 --- +# conversion price -> S2 (Coordination) + +## Economic Entity Reference + +--- ENTITY: conversion price --- + +# Conversion Price + +## Definition + +The price at which agricultural produce, particularly grain, could be converted from payment in kind to payment in money under Scottish agricultural tenancy agreements. This price was typically set below market rates to protect tenants from excessive charges. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses conversion prices as an example of how agricultural rents were historically structured and how they affected the relationship between landlords and tenants in Scotland. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in System 1 to communicate with each other and that allow System 3 to monitor and coordinate activities. System 2 dampens oscillations and resolves conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict resolution, standardisation. + +--- + +## Mapping Rationale + +Conversion price functions as a coordination mechanism that standardizes the relationship between agricultural produce and monetary value in tenancy agreements. It provides a stable reference point that dampens price oscillations and resolves potential conflicts between landlords and tenants, enabling more predictable and coordinated agricultural operations. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: statute of labourers-to-S3 --- +# statute of labourers -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: statute of labourers --- + +# Statute of Labourers + +## Definition + +The English law enacted in 1351 during the reign of Edward III that attempted to regulate wages and prices following the labor shortages caused by the Black Death. The statute set maximum wages and prices for various goods and services. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith references the Statute of Labourers as historical evidence of grain prices in the 14th century, using it to trace the changes in the value of silver relative to corn over time. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Statute of Labourers represents a direct regulatory control mechanism that attempts to manage internal economic operations by setting maximum prices and wages. It functions as an explicit control system that establishes rules and constraints for economic actors, though Smith argues that such direct regulation often reduces rather than enhances economic efficiency. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: assize of bread and ale-to-S3 --- +# assize of bread and ale -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: assize of bread and ale --- + +# Assize of Bread and Ale + +## Definition + +Medieval English regulations that set the prices of bread and ale based on the prices of wheat and barley. These statutes attempted to maintain stable prices for essential food items by adjusting their prices according to grain market conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the assize of bread and ale as another historical example of price regulation, using it to trace the changes in grain prices and the value of silver over time. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Assize of bread and ale functions as a regulatory control mechanism that manages the internal economic environment by setting prices for essential goods. It represents an attempt to optimize the internal economic system through direct price control, though Smith argues that such regulatory interventions often create inefficiencies by interfering with natural market mechanisms. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: exportation bounty-to-S3 --- +# exportation bounty -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: exportation bounty --- + +# Exportation Bounty + +## Definition + +A government subsidy paid to encourage the export of grain, particularly wheat. The bounty was designed to support agricultural prices and encourage production by making exports more profitable. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the bounty on grain exports affected domestic grain prices and agricultural production, arguing that it raised prices in the home market and may have discouraged rather than encouraged tillage in the long run. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Exportation bounty represents a regulatory control mechanism that attempts to manage agricultural production and prices through government intervention. It functions as a policy tool that establishes incentives and constraints for economic actors, though Smith argues that such artificial controls often create unintended consequences that reduce rather than enhance economic efficiency. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: kelp-to-S1 --- +# kelp -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: kelp --- + +# Kelp + +## Definition + +A type of seaweed that, when burned, produces an alkaline salt used in glassmaking, soap production, and other industrial processes. Kelp grows on rocky shores within the high-water mark and can be harvested without cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses kelp as an example of a natural product that can command rent even though it requires no human improvement, demonstrating that rent is not solely a function of agricultural improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Kelp harvesting represents an autonomous operational activity that produces value through natural resource extraction without requiring cultivation or improvement. It demonstrates how operational units can create economic value through the direct exploitation of naturally occurring resources, with the rent mechanism coordinating the allocation of access to these natural productive resources. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: wood price-to-S4 --- +# wood price -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: wood price --- + +# Wood Price + +## Definition + +The market price of timber and firewood, which varies with the state of agriculture and population density. As agriculture advances and reduces forest land, the price of wood typically rises due to increased scarcity. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the price of wood serves as an alternative fuel source to coal and how changes in wood prices affect the demand for coal and the rents of coal mines. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Wood price functions as an environmental intelligence signal that provides information about resource scarcity and substitution patterns in the economic system. It represents how market prices serve as information mechanisms that scan the external environment and signal the need for adaptation in resource use patterns, enabling strategic responses to changing resource conditions. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: coal price-to-S4 --- +# coal price -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: coal price --- + +# Coal Price + +## Definition + +The market price of coal, which is influenced by its abundance, transportation costs, and the availability of alternative fuels. Coal prices tend to be lower in coal-producing regions and higher in areas dependent on imported coal. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes coal prices as an example of how the rent component in commodity prices varies with the natural abundance of resources, arguing that coal rents are typically lower than rents for agricultural land due to the greater abundance of coal mines. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Coal price functions as an environmental intelligence signal that provides information about resource abundance and distribution patterns in the economic system. It represents how market prices serve as information mechanisms that scan the external environment and signal the need for strategic adaptation in energy resource use, enabling responses to changing resource availability and distribution. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: silver price variation-to-S4 --- +# silver price variation -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: silver price variation --- + +# Silver Price Variation + +## Definition + +The changes over time in the value of silver relative to other commodities, particularly corn. These variations reflect changes in the supply of silver from mines and changes in the demand for silver as commerce and wealth increase. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith provides a detailed analysis of how the value of silver has changed relative to corn over the past four centuries, using this as evidence for his theories about the relationship between wealth, commerce, and the value of precious metals. + +## Economic Domain + +Exchange + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Silver price variation functions as an environmental intelligence signal that provides information about long-term economic trends and the relationship between monetary and real economic activity. It represents how price variations serve as information mechanisms that scan the external economic environment and signal the need for strategic adaptation in monetary and commercial systems. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: gold price variation-to-S4 --- +# gold price variation -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: gold price variation --- + +# Gold Price Variation + +## Definition + +The changes over time in the value of gold relative to silver and other commodities. These variations are influenced by the relative abundance of gold and silver mines and the different uses to which the metals are put. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the relative values of gold and silver have changed over time, particularly after the discovery of American mines, and how this affects their use in different economic functions. + +## Economic Domain + +Exchange + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Gold price variation functions as an environmental intelligence signal that provides information about the relative abundance and use of precious metals in the economic system. It represents how price variations serve as information mechanisms that scan the external monetary environment and signal the need for strategic adaptation in monetary systems and international trade. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: precious metals consumption-to-S1 --- +# precious metals consumption -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: precious metals consumption --- + +# Precious Metals Consumption + +## Definition + +The use of gold and silver in various forms including coin, plate, jewelry, and industrial applications. This consumption creates ongoing demand for newly mined precious metals to replace losses from wear, damage, and industrial use. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the consumption of precious metals in various forms creates a continuous demand that must be met by new production, affecting their long-term value and availability. + +## Economic Domain + +Consumption + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Precious metals + +## VSM Framework Reference + +--- +id: vsm-framework +name: vsm_framework +artifact_type: content +description: Stafford Beer's Viable System Model reference for economic analysis +version: 1.0.0 +--- + +# Stafford Beer's Viable System Model (VSM) + +The Viable System Model (VSM) is a model of the organisational structure of any +autonomous system capable of producing itself. It was created by management +cybernetician Stafford Beer in his books *Brain of the Firm* (1972) and +*The Heart of Enterprise* (1979). + +## Core Principle: Viability + +A viable system is any system organised in such a way as to meet the demands +of surviving in a changing environment. One of the prime features of systems +that survive is that they are adaptable. The VSM expresses a model for a +viable system, which is an abstracted cybernetic description applicable to +any organisation that is a going concern. + +## The Five Systems + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the +operational units that directly create value. Each operational element is itself +a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, +individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, +direct engagement with the environment. + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in +System 1 to communicate with each other and that allow System 3 to monitor +and coordinate activities. System 2 dampens oscillations and resolves +conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard +weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict +resolution, standardisation. + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, +and responsibilities of System 1 and provide an interface between Systems 1 +and Systems 4/5. System 3 represents the day-to-day control of the +organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour +laws, enforcement of contracts, the "invisible hand" as emergent internal +regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, +synergy extraction, performance management. + +### System 3* (S3*) — Audit / Monitoring + +The audit and monitoring channel that allows System 3 to verify information +coming from System 1 through channels other than those provided by System 2. +System 3* provides sporadic, direct access to operational reality. + +**In economic terms:** Market inspections, quality checks, auditing of accounts, +surprise investigations into trade practices, verification of weights and measures. + +**Key properties:** Sporadic direct investigation, reality checking, bypassing +normal reporting channels. + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor +how the organisation needs to adapt to remain viable. System 4 captures +all relevant information about the outside-and-then environment. It is +responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, +market research, new technology adoption, colonial exploration and trade +route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic +planning, modelling, research and development. + +### System 5 (S5) — Policy / Identity + +The policy-making body that balances demands from Systems 3 and 4 and defines +the identity, values, and purpose of the organisation. System 5 provides +closure to the whole system and represents its supreme authority. + +**In economic terms:** Sovereign authority, constitutional principles governing +economic policy, national economic identity, the philosophical foundations +of economic systems (mercantilism vs. free trade), the overarching purpose +of the commonwealth. + +**Key properties:** Identity, ethos, supreme command, policy closure, +balancing internal and external perspectives. + +## Key Concepts + +### Recursion + +Every viable system contains and is contained in a viable system. The same +five-system structure recurs at every level of organisation. A workshop is +a viable system within a factory, which is a viable system within an +industry, which is a viable system within a national economy. + +### Variety + +A measure of the number of possible states of a system. The Law of Requisite +Variety (Ashby's Law) states that only variety can absorb variety. A +controller must have at least as much variety as the system it controls. + +### Requisite Variety + +The principle that for effective regulation, the variety of the regulator +must match the variety of the system being regulated. This is achieved +through variety attenuation (reducing the variety coming up from operations) +and variety amplification (increasing the variety of management's responses). + +### Attenuation and Amplification + +Variety engineering mechanisms. Attenuation reduces variety (e.g., reporting +summaries, statistical aggregation, standardisation). Amplification increases +variety (e.g., delegation, empowerment, decentralisation). + +### Algedonic Signals + +Emergency signals that bypass the normal management hierarchy to alert +higher systems of critical situations requiring immediate attention. Named +from the Greek words for pain (algos) and pleasure (hedone). + +**In economic terms:** Market panics, famine signals, sudden price collapses, +trade embargoes, economic crises that demand immediate sovereign intervention. + +### Autonomy + +The degree of freedom granted to operational units (System 1) to self-organise +within constraints set by System 3. Beer argued that maximum autonomy +consistent with systemic cohesion yields maximum viability. + +### Viability + +The capacity of a system to maintain a separate existence and survive in a +changing environment. A viable system continuously adapts while maintaining +its identity. + + +## Instructions + +1. Review the source chapter, extracted entities, and VSM mappings together. +2. Produce a single chapter analysis document following the + Chapter Analysis Schema v1.0. +3. The analysis must include: + - An H1 heading with the chapter analysis title + - A Chapter Summary (50-300 words) of the main economic arguments + - An Entities Extracted section listing all entities with brief descriptions + - A VSM Mappings section listing all mappings with entity, concept, and strength + - A VSM Coverage section assessing which systems (S1-S5, S3*) are represented + - A Gaps & Observations section identifying uncovered systems and patterns +4. In the VSM Coverage section, explicitly state which systems are + covered and which are not, based on the mappings. +5. In Gaps & Observations, note: + - Which VSM systems lack representation from this chapter + - Entities that were difficult to map + - Emerging themes or patterns + - Suggestions for enriching coverage in future analysis + +## Output Format + +Output a single markdown document following the Chapter Analysis Schema v1.0. diff --git a/examples/infospace-with-history/output/analyses/book-1-chapter-11-synthesize-analysis-raw.md b/examples/infospace-with-history/output/analyses/book-1-chapter-11-synthesize-analysis-raw.md new file mode 100644 index 00000000..133e7778 --- /dev/null +++ b/examples/infospace-with-history/output/analyses/book-1-chapter-11-synthesize-analysis-raw.md @@ -0,0 +1,154 @@ +# Chapter Analysis: Rent, Value, and the Viable System Model in Book I, Chapter 11 + +## Chapter Summary + +Book I, Chapter 11 of *The Wealth of Nations* presents Adam Smith's comprehensive analysis of land rent as a fundamental economic phenomenon. Smith establishes rent as a monopoly price determined by what tenants can afford to pay based on land's productive capacity, rather than by the landlord's investment in improvements. The chapter systematically examines how rent varies across different types of land and produce, from unimproved natural resources to highly cultivated vineyards and sugar colonies. Smith demonstrates that rent enters commodity prices differently from wages and profits, and he provides extensive historical evidence tracing the changing value of silver relative to corn over four centuries. The analysis reveals how agricultural improvements affect the distribution of economic returns between landlords, farmers, and consumers, and how different forms of rent (corn rent vs. money rent) coordinate economic activity. Throughout, Smith argues that rent is fundamentally based on agricultural surplus and that improvements in cultivation tend to increase the landlord's share of this surplus. The chapter concludes by establishing the three great economic orders—those who live by rent, wages, and profit—and their distinct relationships to the general interest of society. + +## Entities Extracted + +### Economic Entities + +- **rent-of-land**: Payment for land use based on productive capacity, not landlord investment +- **natural rent of land**: Typical market rent under ordinary conditions +- **monopoly price of land**: Rent exceeding competitive levels due to exclusive control +- **corn rent**: Rent paid in agricultural produce rather than money +- **money rent**: Rent paid in monetary form +- **unimproved land**: Natural land without human enhancements +- **improved land**: Land enhanced through human investment +- **pasture land**: Land used for grazing livestock +- **corn land**: Land used for grain production +- **vineyard**: Land cultivated for grape production +- **kitchen garden**: Land for growing vegetables and herbs +- **hop garden**: Land cultivated for hop production +- **fruit garden**: Land for growing fruit trees +- **fruit-wall**: Protective walls around gardens to extend growing seasons +- **sugar colonies**: Tropical plantations producing sugar +- **tobacco colonies**: North American plantations producing tobacco +- **rice countries**: Regions where rice is the primary crop +- **potato cultivation**: Growing potatoes as a staple crop +- **artificial grasses**: Cultivated forage crops like clover +- **inclosure**: Surrounding land with fences or walls +- **public fiars**: Official grain price valuations in Scotland +- **conversion price**: Price for converting corn rent to money rent +- **statute of labourers**: 1351 English law regulating wages and prices +- **assize of bread and ale**: Medieval regulations setting food prices +- **exportation bounty**: Government subsidy for grain exports +- **kelp**: Seaweed producing alkaline salts +- **wood price**: Market price of timber and firewood +- **coal price**: Market price of coal +- **silver price variation**: Changes in silver's value relative to other goods +- **gold price variation**: Changes in gold's value relative to silver +- **precious metals consumption**: Use of gold and silver in various forms +- **annual consumption of metals**: Yearly use of precious metals +- **mine fertility**: Productivity of mineral mines +- **mine situation**: Geographical location of mines +- **landlord's share**: Portion of produce going to landlords as rent +- **farmer's profit**: Return to agricultural entrepreneurs +- **agricultural stock**: Capital invested in farming operations +- **labouring cattle**: Animals used for agricultural work +- **agricultural improvement**: Enhancements to farming practices +- **agricultural cultivation**: Practice of preparing and using land +- **agricultural surplus**: Excess produce beyond cultivation costs +- **agricultural demand**: Market demand for agricultural products +- **agricultural supply**: Quantity of agricultural products available +- **agricultural productivity**: Efficiency of agricultural production +- **agricultural efficiency**: Effectiveness of resource use in farming +- **agricultural technology**: Tools and methods used in farming +- **agricultural market integration**: Connection of agricultural markets through trade +- **agricultural specialization**: Concentration on specific crops or livestock +- **agricultural comparative advantage**: Relative efficiency in producing different products +- **agricultural trade**: Exchange of agricultural products between regions +- **agricultural price mechanism**: Market process determining agricultural prices +- **agricultural price regulation**: Government interventions in agricultural markets +- **agricultural price stability**: Constancy of agricultural prices over time +- **agricultural price volatility**: Fluctuations in agricultural prices +- **agricultural price discovery**: Process of establishing market prices +- **agricultural price transmission**: How price changes affect different markets +- **agricultural price discrimination**: Charging different prices for the same product +- **agricultural price elasticity**: Responsiveness of supply and demand to price changes +- **agricultural price floors**: Minimum prices set by government +- **agricultural price ceilings**: Maximum prices set by government + +## VSM Mappings + +### Strong Mappings + +- **rent-of-land → S1 (Operations)**: Land as autonomous operational unit producing value +- **rent-of-land → S3 (Control)**: Rent as regulatory mechanism for resource allocation +- **natural rent of land → S3 (Control)**: Baseline regulatory framework for land allocation +- **monopoly price of land → S3 (Control)**: Distortion in internal regulatory mechanisms +- **corn rent → S1 (Operations)**: Direct operational output of agricultural land +- **money rent → S2 (Coordination)**: Standardization mechanism for land value coordination +- **unimproved land → S1 (Operations)**: Autonomous operational unit based on natural capacity +- **improved land → S1 (Operations)**: Enhanced operational unit through human intervention +- **pasture land → S1 (Operations)**: Specialized operational unit for livestock grazing +- **corn land → S1 (Operations)**: Fundamental operational unit of agricultural production +- **vineyard → S1 (Operations)**: Specialized operational unit for high-value production +- **kitchen garden → S1 (Operations)**: Intensive operational unit maximizing value per land +- **hop garden → S1 (Operations)**: Specialized operational unit for specific high-value input +- **fruit garden → S1 (Operations)**: Long-term operational unit for high-value production +- **fruit-wall → S1 (Operations)**: Operational enhancement through infrastructure investment +- **sugar colonies → S1 (Operations)**: Highly specialized operational units with unique advantages +- **tobacco colonies → S1 (Operations)**: Specialized operational units for export production +- **rice countries → S1 (Operations)**: Specialized operational regions focused on rice +- **potato cultivation → S1 (Operations)**: Innovative operational practice increasing productivity +- **artificial grasses → S1 (Operations)**: Operational enhancements extending productive capacity +- **inclosure → S1 (Operations)**: Operational infrastructure improving productivity +- **public fiars → S2 (Coordination)**: Coordination mechanism standardizing grain prices +- **conversion price → S2 (Coordination)**: Coordination mechanism standardizing rent relationships +- **statute of labourers → S3 (Control)**: Direct regulatory control of economic operations +- **assize of bread and ale → S3 (Control)**: Regulatory control of essential goods prices +- **exportation bounty → S3 (Control)**: Regulatory control through government intervention +- **kelp → S1 (Operations)**: Autonomous operational activity based on natural resources +- **wood price → S4 (Intelligence)**: Environmental intelligence signal about resource scarcity +- **coal price → S4 (Intelligence)**: Environmental intelligence signal about resource distribution +- **silver price variation → S4 (Intelligence)**: Environmental intelligence about economic trends +- **gold price variation → S4 (Intelligence)**: Environmental intelligence about monetary systems +- **precious metals consumption → S1 (Operations)**: Operational use of resources in various forms + +## VSM Coverage + +The chapter demonstrates strong coverage of the VSM framework, particularly in Systems 1, 2, 3, and 4, with comprehensive mapping of economic entities to their corresponding VSM functions. + +### Covered Systems + +- **System 1 (S1) - Operations**: Extensively covered through numerous agricultural entities (land, crops, cultivation methods, improvements) that represent autonomous operational units producing value +- **System 2 (S2) - Coordination**: Well-represented through coordination mechanisms like money rent, public fiars, and conversion prices that standardize and harmonize economic activity +- **System 3 (S3) - Control**: Strongly covered through regulatory mechanisms including various forms of rent, price regulations, and government interventions that manage economic operations +- **System 4 (S4) - Intelligence**: Adequately represented through price variations and market signals that provide environmental intelligence for strategic adaptation + +### Uncovered Systems + +- **System 5 (S5) - Policy/Identity**: No explicit representation of the overarching policy-making body or economic identity that would balance internal and external demands +- **System 3* (S3*) - Audit/Monitoring**: No representation of audit or monitoring functions that would verify operational performance through direct investigation + +## Gaps & Observations + +### Missing VSM Systems + +The absence of System 5 (Policy/Identity) is particularly notable, as the chapter focuses heavily on operational mechanics and regulatory mechanisms but lacks representation of the supreme policy-making body that would establish the overall economic identity and balance competing interests. Similarly, the lack of System 3* (Audit/Monitoring) means there's no representation of the verification functions that would ensure operational compliance and performance measurement. + +### Difficult-to-Map Entities + +Some entities were challenging to map definitively to single VSM systems. For instance, agricultural price mechanisms and regulations could arguably belong to multiple systems depending on their specific function and level of operation. The historical price evidence (silver price variations) serves both intelligence and control functions, making precise categorization complex. + +### Emerging Patterns + +Several clear patterns emerge from the mappings: + +1. **Operational Dominance**: System 1 receives the most extensive coverage, reflecting Smith's focus on productive activities and land as the primary source of value creation +2. **Regulatory Emphasis**: System 3 is strongly represented, consistent with Smith's analysis of how different forms of rent and government interventions regulate economic activity +3. **Intelligence Through Prices**: System 4 is represented primarily through price mechanisms, showing how market prices serve as environmental intelligence signals +4. **Coordination Through Standardization**: System 2 is covered through mechanisms that standardize and coordinate economic activity across different regions and time periods + +### Suggestions for Enrichment + +To achieve more complete VSM coverage, future analysis could: + +1. **Identify Policy Frameworks**: Look for references to constitutional principles, national economic identity, or overarching policy frameworks that would represent System 5 +2. **Examine Verification Mechanisms**: Seek evidence of audit, inspection, or monitoring functions that would represent System 3* +3. **Analyze Emergent Regulation**: Consider how the "invisible hand" might function as an emergent control system beyond explicit government regulation +4. **Explore Long-term Strategic Planning**: Identify evidence of strategic responses to environmental changes that would strengthen System 4 coverage +5. **Consider Recursive Structure**: Examine how the five-system structure might recur at different levels (individual farms, regions, national economy) + +The chapter's strong representation of operational and control systems, combined with its analytical framework for understanding rent and value, provides an excellent foundation for VSM analysis, though it would benefit from explicit consideration of policy-making and audit functions to achieve complete systemic viability. \ No newline at end of file diff --git a/examples/infospace-with-history/output/entities/agricultural-comparative-advantage.md b/examples/infospace-with-history/output/entities/agricultural-comparative-advantage.md new file mode 100644 index 00000000..b0d842e4 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-comparative-advantage.md @@ -0,0 +1,21 @@ + + +# Agricultural Comparative Advantage + +## Definition + +The relative efficiency with which different regions can produce various agricultural products, determined by natural conditions, accumulated knowledge, and existing capital investments. Agricultural comparative advantage guides the international division of labor in farming. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how different regions have natural advantages for producing different agricultural products, and how market forces guide the specialization of agricultural production to maximize overall efficiency. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-cultivation.md b/examples/infospace-with-history/output/entities/agricultural-cultivation.md new file mode 100644 index 00000000..555d4a21 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-cultivation.md @@ -0,0 +1,21 @@ + + +# Agricultural Cultivation + +## Definition + +The practice of preparing and using land for growing crops and raising livestock. Cultivation includes all activities from soil preparation to harvest and requires significant labor and capital investment. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how different levels of cultivation affect land productivity and rents, and how the extension of cultivation influences agricultural prices and the distribution of economic returns. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-demand.md b/examples/infospace-with-history/output/entities/agricultural-demand.md new file mode 100644 index 00000000..bc104a91 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-demand.md @@ -0,0 +1,21 @@ + + +# Agricultural Demand + +## Definition + +The market demand for agricultural products, which determines the prices that farmers can obtain for their produce and consequently affects the rents that agricultural land can command. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how changes in agricultural demand, whether from population growth, changes in consumption patterns, or improvements in transportation, affect agricultural prices and rents. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-efficiency.md b/examples/infospace-with-history/output/entities/agricultural-efficiency.md new file mode 100644 index 00000000..df6d5bcb --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-efficiency.md @@ -0,0 +1,21 @@ + + +# Agricultural Efficiency + +## Definition + +The effectiveness with which agricultural resources are used to produce desired outputs, including the optimal allocation of land, labor, and capital in farming operations. Agricultural efficiency affects both productivity and profitability. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements in agricultural efficiency through better management and technology increase the surplus available for rent and support economic growth. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-improvement.md b/examples/infospace-with-history/output/entities/agricultural-improvement.md new file mode 100644 index 00000000..52382bb9 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-improvement.md @@ -0,0 +1,21 @@ + + +# Agricultural Improvement + +## Definition + +Enhancements to farming practices and land productivity through better cultivation techniques, crop rotation, drainage, fencing, and other methods that increase the yield and value of agricultural land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural improvements increase land productivity and rents, and how the benefits of these improvements are distributed between landlords, farmers, and consumers. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-market-integration.md b/examples/infospace-with-history/output/entities/agricultural-market-integration.md new file mode 100644 index 00000000..5cbd9523 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-market-integration.md @@ -0,0 +1,21 @@ + + +# Agricultural Market Integration + +## Definition + +The degree to which different agricultural markets are connected through trade and transportation, allowing prices to equalize across regions and enabling more efficient allocation of agricultural resources. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements in transportation and trade integration affect agricultural markets, enabling regions to specialize in their most productive activities and increasing overall economic efficiency. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-price-ceilings.md b/examples/infospace-with-history/output/entities/agricultural-price-ceilings.md new file mode 100644 index 00000000..93bed34a --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-price-ceilings.md @@ -0,0 +1,19 @@ + + +# Agricultural Price Ceilings + +## Definition + +Maximum prices set by government for agricultural products, typically below market equilibrium levels, intended to protect consumer interests. Agricultural price ceilings can lead to shortages and reduced quality. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines historical examples of agricultural price ceilings, including the Statute of Labourers, arguing that such interventions often harm the very groups they aim to protect and reduce economic efficiency. + +## Economic Domain + +Regulation diff --git a/examples/infospace-with-history/output/entities/agricultural-price-discovery.md b/examples/infospace-with-history/output/entities/agricultural-price-discovery.md new file mode 100644 index 00000000..8000b9e2 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-price-discovery.md @@ -0,0 +1,21 @@ + + +# Agricultural Price Discovery + +## Definition + +The process by which market prices for agricultural products are established through the interaction of buyers and sellers, reflecting information about supply, demand, and production costs. Agricultural price discovery enables efficient resource allocation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price discovery functions in different market conditions and how government interventions can interfere with this process, reducing the efficiency of agricultural markets. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-price-discrimination.md b/examples/infospace-with-history/output/entities/agricultural-price-discrimination.md new file mode 100644 index 00000000..0d2826dc --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-price-discrimination.md @@ -0,0 +1,21 @@ + + +# Agricultural Price Discrimination + +## Definition + +The practice of charging different prices for the same agricultural product in different markets or to different customers, based on their willingness or ability to pay. Agricultural price discrimination can increase seller profits but may reduce economic efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price discrimination occurs in different markets and how transportation costs and market conditions affect the ability of sellers to practice price discrimination. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-price-elasticity.md b/examples/infospace-with-history/output/entities/agricultural-price-elasticity.md new file mode 100644 index 00000000..d8abb41f --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-price-elasticity.md @@ -0,0 +1,21 @@ + + +# Agricultural Price Elasticity + +## Definition + +The responsiveness of agricultural supply and demand to changes in prices, measured as the percentage change in quantity supplied or demanded divided by the percentage change in price. Agricultural price elasticity affects how markets respond to price changes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural supply and demand respond to price changes over different time periods, noting that supply is typically less elastic in the short run due to the biological constraints of agricultural production. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-price-floors.md b/examples/infospace-with-history/output/entities/agricultural-price-floors.md new file mode 100644 index 00000000..0ec00fbe --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-price-floors.md @@ -0,0 +1,21 @@ + + +# Agricultural Price Floors + +## Definition + +Minimum prices set by government for agricultural products, typically above market equilibrium levels, intended to support producer incomes. Agricultural price floors can lead to surpluses and market inefficiencies. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses various forms of agricultural price support, including the bounty on grain exports, arguing that such interventions often create more problems than they solve and reduce overall economic efficiency. + +## Economic Domain + +Regulation + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-price-mechanism.md b/examples/infospace-with-history/output/entities/agricultural-price-mechanism.md new file mode 100644 index 00000000..2005fb4e --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-price-mechanism.md @@ -0,0 +1,21 @@ + + +# Agricultural Price Mechanism + +## Definition + +The market process through which agricultural prices are determined by the interaction of supply and demand, signaling information about scarcity and abundance to producers and consumers. Agricultural price mechanisms guide resource allocation in farming. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price mechanisms function to allocate resources efficiently, though he notes that government interventions like bounties and price regulations can distort these mechanisms and reduce economic efficiency. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-price-regulation.md b/examples/infospace-with-history/output/entities/agricultural-price-regulation.md new file mode 100644 index 00000000..92570ca5 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-price-regulation.md @@ -0,0 +1,21 @@ + + +# Agricultural Price Regulation + +## Definition + +Government interventions in agricultural markets aimed at controlling prices through mechanisms such as price floors, ceilings, or stabilization schemes. Agricultural price regulation can affect production incentives and market efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines various forms of agricultural price regulation, including the Statute of Labourers and the Assize of Bread and Ale, arguing that such interventions often reduce economic efficiency and harm the interests they aim to protect. + +## Economic Domain + +Regulation + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-price-stability.md b/examples/infospace-with-history/output/entities/agricultural-price-stability.md new file mode 100644 index 00000000..b15ad2d9 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-price-stability.md @@ -0,0 +1,21 @@ + + +# Agricultural Price Stability + +## Definition + +The degree to which agricultural prices remain relatively constant over time, unaffected by short-term fluctuations in supply or demand. Agricultural price stability can be pursued through various policy interventions and market mechanisms. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the desirability and feasibility of agricultural price stability, arguing that attempts to stabilize prices often create more problems than they solve and that market-determined prices better serve long-term economic interests. + +## Economic Domain + +Regulation + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-price-transmission.md b/examples/infospace-with-history/output/entities/agricultural-price-transmission.md new file mode 100644 index 00000000..c66d97e5 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-price-transmission.md @@ -0,0 +1,21 @@ + + +# Agricultural Price Transmission + +## Definition + +The process by which price changes in one agricultural market or region affect prices in other markets, facilitated by trade and transportation. Agricultural price transmission enables markets to respond to changes in supply and demand conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in transportation and market integration affect agricultural price transmission, enabling more efficient resource allocation and reducing regional price disparities. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-price-volatility.md b/examples/infospace-with-history/output/entities/agricultural-price-volatility.md new file mode 100644 index 00000000..061d1108 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-price-volatility.md @@ -0,0 +1,21 @@ + + +# Agricultural Price Volatility + +## Definition + +The degree to which agricultural prices fluctuate over time due to changes in supply, demand, weather conditions, and other factors affecting production and consumption. Agricultural price volatility can create uncertainty for producers and consumers. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines the causes and consequences of agricultural price volatility, arguing that while short-term fluctuations can be disruptive, long-term price trends reflect fundamental economic conditions and should not be artificially suppressed. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-productivity.md b/examples/infospace-with-history/output/entities/agricultural-productivity.md new file mode 100644 index 00000000..cff2ad8a --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-productivity.md @@ -0,0 +1,21 @@ + + +# Agricultural Productivity + +## Definition + +The efficiency with which agricultural land produces crops and livestock, typically measured as output per unit of land or per unit of labor. Agricultural productivity is a key determinant of land rents and agricultural profits. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in agricultural productivity through better techniques and technologies increase land rents and reduce the real cost of food, supporting broader economic development. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-specialization.md b/examples/infospace-with-history/output/entities/agricultural-specialization.md new file mode 100644 index 00000000..a9a080df --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-specialization.md @@ -0,0 +1,21 @@ + + +# Agricultural Specialization + +## Definition + +The concentration of agricultural production on specific crops or livestock that are best suited to local conditions, enabled by market integration and transportation improvements. Agricultural specialization increases productivity and economic efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural specialization, facilitated by market integration, allows regions to focus on their most productive activities and increases overall economic efficiency and productivity. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-stock.md b/examples/infospace-with-history/output/entities/agricultural-stock.md new file mode 100644 index 00000000..e288fc61 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-stock.md @@ -0,0 +1,21 @@ + + +# Agricultural Stock + +## Definition + +The capital invested in farming operations, including livestock, implements, seeds, and other materials necessary for cultivation. This stock must be maintained and renewed to ensure continued agricultural production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the maintenance and improvement of agricultural stock is essential for continued productivity and how the returns from farming must be sufficient to maintain this stock while providing profits to the farmer and rent to the landlord. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-supply.md b/examples/infospace-with-history/output/entities/agricultural-supply.md new file mode 100644 index 00000000..6604f390 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-supply.md @@ -0,0 +1,21 @@ + + +# Agricultural Supply + +## Definition + +The quantity of agricultural products available in the market, determined by the extent of cultivation, weather conditions, and other factors affecting production. Agricultural supply directly influences market prices and rents. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how variations in agricultural supply, whether from seasonal conditions or longer-term changes in cultivation practices, affect agricultural prices and the distribution of economic returns. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-surplus.md b/examples/infospace-with-history/output/entities/agricultural-surplus.md new file mode 100644 index 00000000..cab4a72f --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-surplus.md @@ -0,0 +1,21 @@ + + +# Agricultural Surplus + +## Definition + +The excess produce from agricultural land beyond what is required to maintain the farmers, laborers, and livestock necessary for cultivation. This surplus forms the basis for rent payments to landlords and supports non-agricultural economic activities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is fundamentally based on agricultural surplus, as it represents the portion of production that remains after all necessary costs of cultivation have been met. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-technology.md b/examples/infospace-with-history/output/entities/agricultural-technology.md new file mode 100644 index 00000000..7ad19cdd --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-technology.md @@ -0,0 +1,21 @@ + + +# Agricultural Technology + +## Definition + +The tools, techniques, and methods used in farming operations, including implements, crop varieties, cultivation practices, and management systems. Agricultural technology determines the productivity and efficiency of agricultural production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in agricultural technology increase productivity and rents, and how the adoption of new technologies varies with economic conditions and market incentives. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/agricultural-trade.md b/examples/infospace-with-history/output/entities/agricultural-trade.md new file mode 100644 index 00000000..b2f2d4b2 --- /dev/null +++ b/examples/infospace-with-history/output/entities/agricultural-trade.md @@ -0,0 +1,21 @@ + + +# Agricultural Trade + +## Definition + +The exchange of agricultural products between different regions or countries, enabled by transportation infrastructure and market institutions. Agricultural trade allows regions to access products they cannot efficiently produce themselves. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural trade affects domestic agricultural markets, influences land rents, and contributes to overall economic development by enabling regions to specialize according to their comparative advantages. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/annual-consumption-of-metals.md b/examples/infospace-with-history/output/entities/annual-consumption-of-metals.md new file mode 100644 index 00000000..6da36790 --- /dev/null +++ b/examples/infospace-with-history/output/entities/annual-consumption-of-metals.md @@ -0,0 +1,21 @@ + + +# Annual Consumption of Metals + +## Definition + +The total amount of gold and silver used up each year through wear, damage, industrial processes, and other forms of consumption that remove these metals from circulation or usable form. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the annual consumption of precious metals must be balanced by new production to maintain stable supplies, and how this consumption affects their long-term value. + +## Economic Domain + +Consumption + +--- diff --git a/examples/infospace-with-history/output/entities/artificial-grasses.md b/examples/infospace-with-history/output/entities/artificial-grasses.md new file mode 100644 index 00000000..04a8b4d3 --- /dev/null +++ b/examples/infospace-with-history/output/entities/artificial-grasses.md @@ -0,0 +1,27 @@ + + +# Artificial Grasses + +# Turnips + +# Carrots + +# Cabbages + +## Definition + +Cultivated forage crops, including clover and other legumes, as well as root vegetables like turnips, carrots, and cabbages, that can be grown to feed livestock during seasons when natural pasture is unavailable. These crops increase the productivity of pasture land by enabling year-round animal husbandry. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the introduction of artificial grasses and root crops has affected the relative prices of butcher's meat and bread, demonstrating how agricultural innovations can change the economic relationships between different types of production. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/assize-of-bread-and-ale.md b/examples/infospace-with-history/output/entities/assize-of-bread-and-ale.md new file mode 100644 index 00000000..cc0bdef1 --- /dev/null +++ b/examples/infospace-with-history/output/entities/assize-of-bread-and-ale.md @@ -0,0 +1,21 @@ + + +# Assize of Bread and Ale + +## Definition + +Medieval English regulations that set the prices of bread and ale based on the prices of wheat and barley. These statutes attempted to maintain stable prices for essential food items by adjusting their prices according to grain market conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the assize of bread and ale as another historical example of price regulation, using it to trace the changes in grain prices and the value of silver over time. + +## Economic Domain + +Regulation + +--- diff --git a/examples/infospace-with-history/output/entities/book-1-chapter-11-entities.md b/examples/infospace-with-history/output/entities/book-1-chapter-11-entities.md new file mode 100644 index 00000000..d0eacc18 --- /dev/null +++ b/examples/infospace-with-history/output/entities/book-1-chapter-11-entities.md @@ -0,0 +1,240 @@ +# Entities: book-1-chapter-11 + +{{ include "rent-of-land.md" }} + +--- + +{{ include "natural-rent-of-land.md" }} + +--- + +{{ include "monopoly-price-of-land.md" }} + +--- + +{{ include "corn-rent.md" }} + +--- + +{{ include "money-rent.md" }} + +--- + +{{ include "unimproved-land.md" }} + +--- + +{{ include "improved-land.md" }} + +--- + +{{ include "pasture-land.md" }} + +--- + +{{ include "corn-land.md" }} + +--- + +{{ include "vineyard.md" }} + +--- + +{{ include "kitchen-garden.md" }} + +--- + +{{ include "hop-garden.md" }} + +--- + +{{ include "fruit-garden.md" }} + +--- + +{{ include "fruit-wall.md" }} + +--- + +{{ include "sugar-colonies.md" }} + +--- + +{{ include "tobacco-colonies.md" }} + +--- + +{{ include "rice-countries.md" }} + +--- + +{{ include "potato-cultivation.md" }} + +--- + +{{ include "artificial-grasses.md" }} + +--- + +{{ include "inclosure.md" }} + +--- + +{{ include "public-fiars.md" }} + +--- + +{{ include "conversion-price.md" }} + +--- + +{{ include "statute-of-labourers.md" }} + +--- + +{{ include "assize-of-bread-and-ale.md" }} + +--- + +{{ include "exportation-bounty.md" }} + +--- + +{{ include "kelp.md" }} + +--- + +{{ include "wood-price.md" }} + +--- + +{{ include "coal-price.md" }} + +--- + +{{ include "silver-price-variation.md" }} + +--- + +{{ include "gold-price-variation.md" }} + +--- + +{{ include "precious-metals-consumption.md" }} + +--- + +{{ include "annual-consumption-of-metals.md" }} + +--- + +{{ include "mine-fertility.md" }} + +--- + +{{ include "mine-situation.md" }} + +--- + +{{ include "landlords-share.md" }} + +--- + +{{ include "farmers-profit.md" }} + +--- + +{{ include "agricultural-stock.md" }} + +--- + +{{ include "labouring-cattle.md" }} + +--- + +{{ include "agricultural-improvement.md" }} + +--- + +{{ include "agricultural-cultivation.md" }} + +--- + +{{ include "agricultural-surplus.md" }} + +--- + +{{ include "agricultural-demand.md" }} + +--- + +{{ include "agricultural-supply.md" }} + +--- + +{{ include "agricultural-productivity.md" }} + +--- + +{{ include "agricultural-efficiency.md" }} + +--- + +{{ include "agricultural-technology.md" }} + +--- + +{{ include "agricultural-market-integration.md" }} + +--- + +{{ include "agricultural-specialization.md" }} + +--- + +{{ include "agricultural-comparative-advantage.md" }} + +--- + +{{ include "agricultural-trade.md" }} + +--- + +{{ include "agricultural-price-mechanism.md" }} + +--- + +{{ include "agricultural-price-regulation.md" }} + +--- + +{{ include "agricultural-price-stability.md" }} + +--- + +{{ include "agricultural-price-volatility.md" }} + +--- + +{{ include "agricultural-price-discovery.md" }} + +--- + +{{ include "agricultural-price-transmission.md" }} + +--- + +{{ include "agricultural-price-discrimination.md" }} + +--- + +{{ include "agricultural-price-elasticity.md" }} + +--- + +{{ include "agricultural-price-floors.md" }} + +--- + +{{ include "agricultural-price-ceilings.md" }} + diff --git a/examples/infospace-with-history/output/entities/book-1-chapter-11-extract-entities-raw.md b/examples/infospace-with-history/output/entities/book-1-chapter-11-extract-entities-raw.md new file mode 100644 index 00000000..dba1891d --- /dev/null +++ b/examples/infospace-with-history/output/entities/book-1-chapter-11-extract-entities-raw.md @@ -0,0 +1,1265 @@ +--- ENTITY: rent-of-land --- + +# Rent of Land + +## Definition + +The payment made by a tenant to a landlord for the use of land, representing the surplus value that the land generates beyond what is required to maintain the stock employed in cultivation and provide ordinary profits to the farmer. Rent is determined by what the tenant can afford to pay based on the productive capacity of the land, not by the landlord's investment in improvements. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +This is the central concept of the chapter, forming the foundation for Smith's analysis of how rent functions as a component of commodity prices and how it varies with different types of land and produce. The chapter systematically examines rent's nature, determinants, and relationship to other economic factors. + +## Economic Domain + +Distribution + +--- +--- ENTITY: natural rent of land --- + +# Natural Rent of Land + +## Definition + +The ordinary or typical rent that land commands in the market, determined by the surplus value that can be extracted from the land after maintaining the stock required for cultivation and providing ordinary profits to the farmer. This represents the price that land would naturally command in the absence of special circumstances or market distortions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith distinguishes between the natural rent that land would command under ordinary market conditions and the actual rent that may result from various circumstances. This concept helps explain the baseline against which other rent variations can be measured. + +## Economic Domain + +Distribution + +--- +--- ENTITY: monopoly price of land --- + +# Monopoly Price of Land + +## Definition + +The price paid for the use of land that exceeds what would be paid under competitive conditions, arising from the landlord's exclusive control over a particular piece of land. This price is determined by what the tenant can afford to pay rather than by the cost of providing the land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is essentially a monopoly price because it is not determined by the cost of providing the land but by what the tenant can afford to pay based on the land's productive capacity. This concept is crucial for understanding how rent differs from other forms of economic returns. + +## Economic Domain + +Distribution + +--- +--- ENTITY: corn rent --- + +# Corn Rent + +## Definition + +Rent paid in the form of a portion of the agricultural produce, particularly grain, rather than in money. This form of rent directly ties the landlord's income to the productivity of the land and the success of the harvest. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how rent can be paid either in kind (corn rent) or in money, and how this distinction affects the relationship between landlords and tenants. Corn rent provides a more direct connection between land productivity and landlord income. + +## Economic Domain + +Distribution + +--- +--- ENTITY: money rent --- + +# Money Rent + +## Definition + +Rent paid in monetary form rather than in agricultural produce. This represents the market value of the land's productive capacity expressed in currency terms. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the transition from corn rent to money rent affects the relationship between landlords and tenants, and how money rent provides a more flexible and standardized form of payment that can better reflect market conditions. + +## Economic Domain + +Distribution + +--- +--- ENTITY: unimproved land --- + +# Unimproved Land + +## Definition + +Land that has not been enhanced through human investment in drainage, fencing, clearing, or other improvements that increase its productive capacity. Even unimproved land can command rent based on its natural productive qualities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses examples of unimproved land, such as kelp-producing shores and uncultivated pastures, to demonstrate that rent is not solely a function of human improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- +--- ENTITY: improved land --- + +# Improved Land + +## Definition + +Land that has been enhanced through human investment in cultivation, drainage, fencing, clearing, or other modifications that increase its productive capacity beyond its natural state. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements to land affect its productive capacity and, consequently, the rent it can command. Improved land typically generates higher rents due to its increased productivity. + +## Economic Domain + +Production + +--- +--- ENTITY: pasture land --- + +# Pasture Land + +## Definition + +Land used primarily for grazing livestock, particularly cattle and sheep. The rent of pasture land is determined by its capacity to support animals and the market value of the livestock products it produces. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the rent of pasture land varies with its quality and location, and how it competes with corn land in the agricultural economy. He examines the factors that determine whether land is more profitably used for pasture or cultivation. + +## Economic Domain + +Production + +--- +--- ENTITY: corn land --- + +# Corn Land + +## Definition + +Land used for growing grain crops, particularly wheat and other cereals. The rent of corn land is determined by its productivity in grain production and the market price of grain. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how corn land serves as the baseline for determining rents of other types of land, as grain production is the most fundamental agricultural activity and provides the subsistence for most of the population. + +## Economic Domain + +Production + +--- +--- ENTITY: vineyard --- + +# Vineyard + +## Definition + +Land specifically cultivated for grape production to make wine. Vineyards often command premium rents due to the high value of wine and the limited geographical areas suitable for viticulture. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses vineyards as an example of land that can command exceptionally high rents due to the high value of its produce and the limited supply of suitable land. He discusses how vineyard rents are regulated by the profitability of corn production. + +## Economic Domain + +Production + +--- +--- ENTITY: kitchen garden --- + +# Kitchen Garden + +## Definition + +Land used for growing vegetables and herbs for household consumption. Kitchen gardens require intensive cultivation and can command higher rents per unit area than field crops due to their high value relative to the land they occupy. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses kitchen gardens as an example of high-value agricultural production that can justify intensive cultivation and higher rents, particularly when located near urban markets where fresh produce commands premium prices. + +## Economic Domain + +Production + +--- +--- ENTITY: hop garden --- + +# Hop Garden + +## Definition + +Land specifically cultivated for growing hops, used primarily in beer production. Hop gardens represent a specialized form of agriculture that can command higher rents due to the value of the crop and the intensive cultivation required. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses hop gardens as an example of specialized agricultural production that requires more investment and care than general field crops, and therefore can command higher rents and profits. + +## Economic Domain + +Production + +--- +--- ENTITY: fruit garden --- + +# Fruit Garden + +## Definition + +Land used for growing fruit trees and bushes. Fruit gardens represent a long-term investment in agriculture that can command premium rents due to the high value of fruit relative to the land required for its production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses fruit gardens as another example of specialized agricultural production that can justify higher rents due to the value of the produce and the care required for successful cultivation. + +## Economic Domain + +Production + +--- +--- ENTITY: fruit-wall --- + +# Fruit-Wall + +## Definition + +A wall constructed around a kitchen garden or orchard to protect fruit trees from wind and to create a warmer microclimate that extends the growing season. The cost of building and maintaining fruit-walls is justified by the higher value of the protected fruit production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses fruit-walls as an example of agricultural improvements that increase the value of land by enabling the production of higher-value crops that would not otherwise be viable in the local climate. + +## Economic Domain + +Production + +--- +--- ENTITY: sugar colonies --- + +# Sugar Colonies + +## Definition + +Plantations in tropical regions, particularly in the West Indies, that produce sugar cane for export to European markets. These colonies represent a form of specialized agricultural production that commands exceptionally high profits and rents due to the high value of sugar and the limited geographical areas suitable for its cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses sugar colonies as an extreme example of land that can command rents far exceeding those of ordinary agricultural land, due to the combination of high-value production and limited suitable territory. + +## Economic Domain + +Production + +--- +--- ENTITY: tobacco colonies --- + +# Tobacco Colonies + +## Definition + +Plantations in North America, particularly Virginia and Maryland, that produce tobacco for export to European markets. Tobacco cultivation represents a specialized form of agriculture that can command high rents due to the value of the crop and the limited suitable land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses tobacco colonies as another example of specialized agricultural production that can command rents exceeding those of ordinary agricultural land, though typically not as high as sugar colonies due to greater competition and more widely available suitable land. + +## Economic Domain + +Production + +--- +--- ENTITY: rice countries --- + +# Rice Countries + +## Definition + +Regions where rice is the primary agricultural product and staple food, such as parts of Asia and the American South. Rice cultivation typically requires specific environmental conditions and intensive labor, leading to different economic dynamics than wheat-producing regions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses rice countries to illustrate how the nature of the primary agricultural product affects the distribution of economic returns, particularly how rice cultivation can support higher rents due to its high productivity per acre. + +## Economic Domain + +Production + +--- +--- ENTITY: potato cultivation --- + +# Potato Cultivation + +## Definition + +The agricultural practice of growing potatoes as a staple food crop. Potato cultivation can support higher population densities and potentially higher rents than grain cultivation due to its higher productivity per acre and nutritional value. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses potato cultivation as a potentially revolutionary agricultural practice that could support larger populations and higher rents than traditional grain cultivation, though he notes the practical difficulties of storage and preservation. + +## Economic Domain + +Production + +--- +--- ENTITY: artificial grasses --- + +# Artificial Grasses + +# Turnips + +# Carrots + +# Cabbages + +## Definition + +Cultivated forage crops, including clover and other legumes, as well as root vegetables like turnips, carrots, and cabbages, that can be grown to feed livestock during seasons when natural pasture is unavailable. These crops increase the productivity of pasture land by enabling year-round animal husbandry. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the introduction of artificial grasses and root crops has affected the relative prices of butcher's meat and bread, demonstrating how agricultural innovations can change the economic relationships between different types of production. + +## Economic Domain + +Production + +--- +--- ENTITY: inclosure --- + +# Inclosure + +## Definition + +The practice of surrounding land with fences, hedges, or walls to create defined agricultural units. Inclosure increases the productivity of land by enabling better control of livestock, more intensive cultivation, and protection of crops from damage. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how inclosure affects land rents and agricultural productivity, arguing that it is particularly beneficial for pasture land and that the high rents currently commanded by inclosed land in Scotland are due to temporary scarcity rather than permanent advantage. + +## Economic Domain + +Production + +--- +--- ENTITY: public fiars --- + +# Public Fiars + +## Definition + +Official annual valuations of grain prices conducted by assize courts in Scotland to establish fair prices for various grains and qualities. These valuations provided a standardized basis for converting corn rents to money rents and for other legal and commercial purposes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith mentions public fiars as an example of how governments have attempted to regulate grain prices and provide stability in agricultural markets, though he generally favors market-determined prices over official valuations. + +## Economic Domain + +Regulation + +--- +--- ENTITY: conversion price --- + +# Conversion Price + +## Definition + +The price at which agricultural produce, particularly grain, could be converted from payment in kind to payment in money under Scottish agricultural tenancy agreements. This price was typically set below market rates to protect tenants from excessive charges. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses conversion prices as an example of how agricultural rents were historically structured and how they affected the relationship between landlords and tenants in Scotland. + +## Economic Domain + +Distribution + +--- +--- ENTITY: statute of labourers --- + +# Statute of Labourers + +## Definition + +The English law enacted in 1351 during the reign of Edward III that attempted to regulate wages and prices following the labor shortages caused by the Black Death. The statute set maximum wages and prices for various goods and services. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith references the Statute of Labourers as historical evidence of grain prices in the 14th century, using it to trace the changes in the value of silver relative to corn over time. + +## Economic Domain + +Regulation + +--- +--- ENTITY: assize of bread and ale --- + +# Assize of Bread and Ale + +## Definition + +Medieval English regulations that set the prices of bread and ale based on the prices of wheat and barley. These statutes attempted to maintain stable prices for essential food items by adjusting their prices according to grain market conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the assize of bread and ale as another historical example of price regulation, using it to trace the changes in grain prices and the value of silver over time. + +## Economic Domain + +Regulation + +--- +--- ENTITY: exportation bounty --- + +# Exportation Bounty + +## Definition + +A government subsidy paid to encourage the export of grain, particularly wheat. The bounty was designed to support agricultural prices and encourage production by making exports more profitable. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the bounty on grain exports affected domestic grain prices and agricultural production, arguing that it raised prices in the home market and may have discouraged rather than encouraged tillage in the long run. + +## Economic Domain + +Regulation + +--- +--- ENTITY: kelp --- + +# Kelp + +## Definition + +A type of seaweed that, when burned, produces an alkaline salt used in glassmaking, soap production, and other industrial processes. Kelp grows on rocky shores within the high-water mark and can be harvested without cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses kelp as an example of a natural product that can command rent even though it requires no human improvement, demonstrating that rent is not solely a function of agricultural improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- +--- ENTITY: wood price --- + +# Wood Price + +## Definition + +The market price of timber and firewood, which varies with the state of agriculture and population density. As agriculture advances and reduces forest land, the price of wood typically rises due to increased scarcity. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the price of wood serves as an alternative fuel source to coal and how changes in wood prices affect the demand for coal and the rents of coal mines. + +## Economic Domain + +Production + +--- +--- ENTITY: coal price --- + +# Coal Price + +## Definition + +The market price of coal, which is influenced by its abundance, transportation costs, and the availability of alternative fuels. Coal prices tend to be lower in coal-producing regions and higher in areas dependent on imported coal. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes coal prices as an example of how the rent component in commodity prices varies with the natural abundance of resources, arguing that coal rents are typically lower than rents for agricultural land due to the greater abundance of coal mines. + +## Economic Domain + +Production + +--- +--- ENTITY: silver price variation --- + +# Silver Price Variation + +## Definition + +The changes over time in the value of silver relative to other commodities, particularly corn. These variations reflect changes in the supply of silver from mines and changes in the demand for silver as commerce and wealth increase. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith provides a detailed analysis of how the value of silver has changed relative to corn over the past four centuries, using this as evidence for his theories about the relationship between wealth, commerce, and the value of precious metals. + +## Economic Domain + +Exchange + +--- +--- ENTITY: gold price variation --- + +# Gold Price Variation + +## Definition + +The changes over time in the value of gold relative to silver and other commodities. These variations are influenced by the relative abundance of gold and silver mines and the different uses to which the metals are put. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the relative values of gold and silver have changed over time, particularly after the discovery of American mines, and how this affects their use in different economic functions. + +## Economic Domain + +Exchange + +--- +--- ENTITY: precious metals consumption --- + +# Precious Metals Consumption + +## Definition + +The use of gold and silver in various forms including coin, plate, jewelry, and industrial applications. This consumption creates ongoing demand for newly mined precious metals to replace losses from wear, damage, and industrial use. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the consumption of precious metals in various forms creates a continuous demand that must be met by new production, affecting their long-term value and availability. + +## Economic Domain + +Consumption + +--- +--- ENTITY: annual consumption of metals --- + +# Annual Consumption of Metals + +## Definition + +The total amount of gold and silver used up each year through wear, damage, industrial processes, and other forms of consumption that remove these metals from circulation or usable form. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the annual consumption of precious metals must be balanced by new production to maintain stable supplies, and how this consumption affects their long-term value. + +## Economic Domain + +Consumption + +--- +--- ENTITY: mine fertility --- + +# Mine Fertility + +## Definition + +The productivity of a mineral mine in terms of the quantity of valuable material that can be extracted per unit of labor and capital invested. Mine fertility varies significantly between different mines and affects the price and rent of the extracted minerals. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses the concept of mine fertility to explain why the rent component in mineral prices is typically lower than in agricultural products, as mineral deposits are generally more abundant and less geographically concentrated than fertile agricultural land. + +## Economic Domain + +Production + +--- +--- ENTITY: mine situation --- + +# Mine Situation + +## Definition + +The geographical location of a mineral mine and its accessibility to markets and transportation infrastructure. Mine situation can significantly affect the cost of production and the price that can be obtained for the extracted minerals. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that for mineral extraction, the situation of the mine is often more important than its fertility in determining profitability, as transportation costs can significantly affect the competitiveness of mineral products in distant markets. + +## Economic Domain + +Production + +--- +--- ENTITY: landlord's share --- + +# Landlord's Share + +## Definition + +The portion of the total produce from land that goes to the landlord as rent, distinct from the portions that go to the farmer as profit and to laborers as wages. The landlord's share increases with the productivity of the land and the efficiency of cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the landlord's share of agricultural produce is determined by the surplus value created by the land after all necessary costs of production have been met, and how this share varies with different types of land and agricultural practices. + +## Economic Domain + +Distribution + +--- +--- ENTITY: farmer's profit --- + +# Farmer's Profit + +## Definition + +The return to the agricultural entrepreneur for the use of capital and management in farming operations. This profit must be sufficient to compensate for the risk and effort involved in cultivation and to provide a return comparable to other forms of investment. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how farmers' profits are determined by the productivity of the land and the efficiency of cultivation, and how these profits must be sufficient to maintain and improve the stock employed in agriculture. + +## Economic Domain + +Distribution + +--- +--- ENTITY: agricultural stock --- + +# Agricultural Stock + +## Definition + +The capital invested in farming operations, including livestock, implements, seeds, and other materials necessary for cultivation. This stock must be maintained and renewed to ensure continued agricultural production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the maintenance and improvement of agricultural stock is essential for continued productivity and how the returns from farming must be sufficient to maintain this stock while providing profits to the farmer and rent to the landlord. + +## Economic Domain + +Production + +--- +--- ENTITY: labouring cattle --- + +# Labouring Cattle + +## Definition + +Animals used for agricultural work, particularly oxen and horses that pull plows and perform other farm tasks. The cost of maintaining labouring cattle is a significant component of agricultural expenses. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the cost and availability of labouring cattle affect agricultural productivity and how improvements in cattle breeding and feeding can increase the efficiency of farming operations. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural improvement --- + +# Agricultural Improvement + +## Definition + +Enhancements to farming practices and land productivity through better cultivation techniques, crop rotation, drainage, fencing, and other methods that increase the yield and value of agricultural land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural improvements increase land productivity and rents, and how the benefits of these improvements are distributed between landlords, farmers, and consumers. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural cultivation --- + +# Agricultural Cultivation + +## Definition + +The practice of preparing and using land for growing crops and raising livestock. Cultivation includes all activities from soil preparation to harvest and requires significant labor and capital investment. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how different levels of cultivation affect land productivity and rents, and how the extension of cultivation influences agricultural prices and the distribution of economic returns. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural surplus --- + +# Agricultural Surplus + +## Definition + +The excess produce from agricultural land beyond what is required to maintain the farmers, laborers, and livestock necessary for cultivation. This surplus forms the basis for rent payments to landlords and supports non-agricultural economic activities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is fundamentally based on agricultural surplus, as it represents the portion of production that remains after all necessary costs of cultivation have been met. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural demand --- + +# Agricultural Demand + +## Definition + +The market demand for agricultural products, which determines the prices that farmers can obtain for their produce and consequently affects the rents that agricultural land can command. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how changes in agricultural demand, whether from population growth, changes in consumption patterns, or improvements in transportation, affect agricultural prices and rents. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural supply --- + +# Agricultural Supply + +## Definition + +The quantity of agricultural products available in the market, determined by the extent of cultivation, weather conditions, and other factors affecting production. Agricultural supply directly influences market prices and rents. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how variations in agricultural supply, whether from seasonal conditions or longer-term changes in cultivation practices, affect agricultural prices and the distribution of economic returns. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural productivity --- + +# Agricultural Productivity + +## Definition + +The efficiency with which agricultural land produces crops and livestock, typically measured as output per unit of land or per unit of labor. Agricultural productivity is a key determinant of land rents and agricultural profits. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in agricultural productivity through better techniques and technologies increase land rents and reduce the real cost of food, supporting broader economic development. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural efficiency --- + +# Agricultural Efficiency + +## Definition + +The effectiveness with which agricultural resources are used to produce desired outputs, including the optimal allocation of land, labor, and capital in farming operations. Agricultural efficiency affects both productivity and profitability. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements in agricultural efficiency through better management and technology increase the surplus available for rent and support economic growth. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural technology --- + +# Agricultural Technology + +## Definition + +The tools, techniques, and methods used in farming operations, including implements, crop varieties, cultivation practices, and management systems. Agricultural technology determines the productivity and efficiency of agricultural production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in agricultural technology increase productivity and rents, and how the adoption of new technologies varies with economic conditions and market incentives. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural market integration --- + +# Agricultural Market Integration + +## Definition + +The degree to which different agricultural markets are connected through trade and transportation, allowing prices to equalize across regions and enabling more efficient allocation of agricultural resources. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements in transportation and trade integration affect agricultural markets, enabling regions to specialize in their most productive activities and increasing overall economic efficiency. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural specialization --- + +# Agricultural Specialization + +## Definition + +The concentration of agricultural production on specific crops or livestock that are best suited to local conditions, enabled by market integration and transportation improvements. Agricultural specialization increases productivity and economic efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural specialization, facilitated by market integration, allows regions to focus on their most productive activities and increases overall economic efficiency and productivity. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural comparative advantage --- + +# Agricultural Comparative Advantage + +## Definition + +The relative efficiency with which different regions can produce various agricultural products, determined by natural conditions, accumulated knowledge, and existing capital investments. Agricultural comparative advantage guides the international division of labor in farming. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how different regions have natural advantages for producing different agricultural products, and how market forces guide the specialization of agricultural production to maximize overall efficiency. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural trade --- + +# Agricultural Trade + +## Definition + +The exchange of agricultural products between different regions or countries, enabled by transportation infrastructure and market institutions. Agricultural trade allows regions to access products they cannot efficiently produce themselves. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural trade affects domestic agricultural markets, influences land rents, and contributes to overall economic development by enabling regions to specialize according to their comparative advantages. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price mechanism --- + +# Agricultural Price Mechanism + +## Definition + +The market process through which agricultural prices are determined by the interaction of supply and demand, signaling information about scarcity and abundance to producers and consumers. Agricultural price mechanisms guide resource allocation in farming. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price mechanisms function to allocate resources efficiently, though he notes that government interventions like bounties and price regulations can distort these mechanisms and reduce economic efficiency. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price regulation --- + +# Agricultural Price Regulation + +## Definition + +Government interventions in agricultural markets aimed at controlling prices through mechanisms such as price floors, ceilings, or stabilization schemes. Agricultural price regulation can affect production incentives and market efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines various forms of agricultural price regulation, including the Statute of Labourers and the Assize of Bread and Ale, arguing that such interventions often reduce economic efficiency and harm the interests they aim to protect. + +## Economic Domain + +Regulation + +--- +--- ENTITY: agricultural price stability --- + +# Agricultural Price Stability + +## Definition + +The degree to which agricultural prices remain relatively constant over time, unaffected by short-term fluctuations in supply or demand. Agricultural price stability can be pursued through various policy interventions and market mechanisms. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the desirability and feasibility of agricultural price stability, arguing that attempts to stabilize prices often create more problems than they solve and that market-determined prices better serve long-term economic interests. + +## Economic Domain + +Regulation + +--- +--- ENTITY: agricultural price volatility --- + +# Agricultural Price Volatility + +## Definition + +The degree to which agricultural prices fluctuate over time due to changes in supply, demand, weather conditions, and other factors affecting production and consumption. Agricultural price volatility can create uncertainty for producers and consumers. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines the causes and consequences of agricultural price volatility, arguing that while short-term fluctuations can be disruptive, long-term price trends reflect fundamental economic conditions and should not be artificially suppressed. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price discovery --- + +# Agricultural Price Discovery + +## Definition + +The process by which market prices for agricultural products are established through the interaction of buyers and sellers, reflecting information about supply, demand, and production costs. Agricultural price discovery enables efficient resource allocation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price discovery functions in different market conditions and how government interventions can interfere with this process, reducing the efficiency of agricultural markets. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price transmission --- + +# Agricultural Price Transmission + +## Definition + +The process by which price changes in one agricultural market or region affect prices in other markets, facilitated by trade and transportation. Agricultural price transmission enables markets to respond to changes in supply and demand conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in transportation and market integration affect agricultural price transmission, enabling more efficient resource allocation and reducing regional price disparities. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price discrimination --- + +# Agricultural Price Discrimination + +## Definition + +The practice of charging different prices for the same agricultural product in different markets or to different customers, based on their willingness or ability to pay. Agricultural price discrimination can increase seller profits but may reduce economic efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price discrimination occurs in different markets and how transportation costs and market conditions affect the ability of sellers to practice price discrimination. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price elasticity --- + +# Agricultural Price Elasticity + +## Definition + +The responsiveness of agricultural supply and demand to changes in prices, measured as the percentage change in quantity supplied or demanded divided by the percentage change in price. Agricultural price elasticity affects how markets respond to price changes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural supply and demand respond to price changes over different time periods, noting that supply is typically less elastic in the short run due to the biological constraints of agricultural production. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price floors --- + +# Agricultural Price Floors + +## Definition + +Minimum prices set by government for agricultural products, typically above market equilibrium levels, intended to support producer incomes. Agricultural price floors can lead to surpluses and market inefficiencies. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses various forms of agricultural price support, including the bounty on grain exports, arguing that such interventions often create more problems than they solve and reduce overall economic efficiency. + +## Economic Domain + +Regulation + +--- +--- ENTITY: agricultural price ceilings --- + +# Agricultural Price Ceilings + +## Definition + +Maximum prices set by government for agricultural products, typically below market equilibrium levels, intended to protect consumer interests. Agricultural price ceilings can lead to shortages and reduced quality. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines historical examples of agricultural price ceilings, including the Statute of Labourers, arguing that such interventions often harm the very groups they aim to protect and reduce economic efficiency. + +## Economic Domain + +Regulation + diff --git a/examples/infospace-with-history/output/entities/book-1-chapter-11-prompt.md b/examples/infospace-with-history/output/entities/book-1-chapter-11-prompt.md new file mode 100644 index 00000000..fd0f39b6 --- /dev/null +++ b/examples/infospace-with-history/output/entities/book-1-chapter-11-prompt.md @@ -0,0 +1,4974 @@ +# Extract Economic Entities + +You are an analytical economist specializing in classical economic theory. +Your task is to extract distinct economic entities from a chapter of +Adam Smith's *The Wealth of Nations*. + +## Source Chapter + +--- +id: book-1-chapter-11 +title: "OF THE RENT OF LAND." +book: "1" +chapter: 11 +artifact_type: content +--- + +CHAPTER XI. +OF THE RENT OF LAND. + + + + Rent, considered as the price paid for the use of land, is naturally the + highest which the tenant can afford to pay in the actual circumstances of + the land. In adjusting the terms of the lease, the landlord endeavours to + leave him no greater share of the produce than what is sufficient to keep + up the stock from which he furnishes the seed, pays the labour, and + purchases and maintains the cattle and other instruments of husbandry, + together with the ordinary profits of farming stock in the neighbourhood. + This is evidently the smallest share with which the tenant can content + himself, without being a loser, and the landlord seldom means to leave him + any more. Whatever part of the produce, or, what is the same thing, + whatever part of its price, is over and above this share, he naturally + endeavours to reserve to himself as the rent of his land, which is + evidently the highest the tenant can afford to pay in the actual + circumstances of the land. Sometimes, indeed, the liberality, more + frequently the ignorance, of the landlord, makes him accept of somewhat + less than this portion; and sometimes, too, though more rarely, the + ignorance of the tenant makes him undertake to pay somewhat more, or to + content himself with somewhat less, than the ordinary profits of farming + stock in the neighbourhood. This portion, however, may still be considered + as the natural rent of land, or the rent at which it is naturally meant + that land should, for the most part, be let. + + The rent of land, it may be thought, is frequently no more than a + reasonable profit or interest for the stock laid out by the landlord upon + its improvement. This, no doubt, may be partly the case upon some + occasions; for it can scarce ever be more than partly the case. The + landlord demands a rent even for unimproved land, and the supposed + interest or profit upon the expense of improvement is generally an + addition to this original rent. Those improvements, besides, are not + always made by the stock of the landlord, but sometimes by that of the + tenant. When the lease comes to be renewed, however, the landlord commonly + demands the same augmentation of rent as if they had been all made by his + own. + + He sometimes demands rent for what is altogether incapable of human + improvements. Kelp is a species of sea-weed, which, when burnt, yields an + alkaline salt, useful for making glass, soap, and for several other + purposes. It grows in several parts of Great Britain, particularly in + Scotland, upon such rocks only as lie within the high-water mark, which + are twice every day covered with the sea, and of which the produce, + therefore, was never augmented by human industry. The landlord, however, + whose estate is bounded by a kelp shore of this kind, demands a rent for + it as much as for his corn-fields. + + The sea in the neighbourhood of the islands of Shetland is more than + commonly abundant in fish, which makes a great part of the subsistence of + their inhabitants. But, in order to profit by the produce of the water, + they must have a habitation upon the neighbouring land. The rent of the + landlord is in proportion, not to what the farmer can make by the land, + but to what he can make both by the land and the water. It is partly paid + in sea-fish; and one of the very few instances in which rent makes a part + of the price of that commodity, is to be found in that country. + + The rent of land, therefore, considered as the price paid for the use of + the land, is naturally a monopoly price. It is not at all proportioned to + what the landlord may have laid out upon the improvement of the land, or + to what he can afford to take, but to what the farmer can afford to give. + + Such parts only of the produce of land can commonly be brought to market, + of which the ordinary price is sufficient to replace the stock which must + be employed in bringing them thither, together with its ordinary profits. + If the ordinary price is more than this, the surplus part of it will + naturally go to the rent of the land. If it is not more, though the + commodity may be brought to market, it can afford no rent to the landlord. + Whether the price is, or is not more, depends upon the demand. + + There are some parts of the produce of land, for which the demand must + always be such as to afford a greater price than what is sufficient to + bring them to market; and there are others for which it either may or may + not be such as to afford this greater price. The former must always afford + a rent to the landlord. The latter sometimes may and sometimes may not, + according to different circumstances. + + Rent, it is to be observed, therefore, enters into the composition of the + price of commodities in a different way from wages and profit. High or low + wages and profit are the causes of high or low price; high or low rent is + the effect of it. It is because high or low wages and profit must be paid, + in order to bring a particular commodity to market, that its price is high + or low. But it is because its price is high or low, a great deal more, or + very little more, or no more, than what is sufficient to pay those wages + and profit, that it affords a high rent, or a low rent, or no rent at all. + + The particular consideration, first, of those parts of the produce of land + which always afford some rent; secondly, of those which sometimes may and + sometimes may not afford rent; and, thirdly, of the variations which, in + the different periods of improvement, naturally take place in the relative + value of those two different sorts of rude produce, when compared both + with one another and with manufactured commodities, will divide this + chapter into three parts. + + + + + PART I.—Of the Produce of Land which always affords Rent. + + As men, like all other animals, naturally multiply in proportion to the + means of their subsistence, food is always more or less in demand. It can + always purchase or command a greater or smaller quantity of labour, and + somebody can always be found who is willing to do something in order to + obtain it. The quantity of labour, indeed, which it can purchase, is not + always equal to what it could maintain, if managed in the most economical + manner, on account of the high wages which are sometimes given to labour; + but it can always purchase such a quantity of labour as it can maintain, + according to the rate at which that sort of labour is commonly maintained + in the neighbourhood. + + But land, in almost any situation, produces a greater quantity of food + than what is sufficient to maintain all the labour necessary for bringing + it to market, in the most liberal way in which that labour is ever + maintained. The surplus, too, is always more than sufficient to replace + the stock which employed that labour, together with its profits. + Something, therefore, always remains for a rent to the landlord. + + The most desert moors in Norway and Scotland produce some sort of pasture + for cattle, of which the milk and the increase are always more than + sufficient, not only to maintain all the labour necessary for tending + them, and to pay the ordinary profit to the farmer or the owner of the + herd or flock, but to afford some small rent to the landlord. The rent + increases in proportion to the goodness of the pasture. The same extent of + ground not only maintains a greater number of cattle, but as they are + brought within a smaller compass, less labour becomes requisite to tend + them, and to collect their produce. The landlord gains both ways; by the + increase of the produce, and by the diminution of the labour which must be + maintained out of it. + + The rent of land not only varies with its fertility, whatever be its + produce, but with its situation, whatever be its fertility. Land in the + neighbourhood of a town gives a greater rent than land equally fertile in + a distant part of the country. Though it may cost no more labour to + cultivate the one than the other, it must always cost more to bring the + produce of the distant land to market. A greater quantity of labour, + therefore, must be maintained out of it; and the surplus, from which are + drawn both the profit of the farmer and the rent of the landlord, must be + diminished. But in remote parts of the country, the rate of profit, as has + already been shewn, is generally higher than in the neighbourhood of a + large town. A smaller proportion of this diminished surplus, therefore, + must belong to the landlord. + + Good roads, canals, and navigable rivers, by diminishing the expense of + carriage, put the remote parts of the country more nearly upon a level + with those in the neighbourhood of the town. They are upon that account + the greatest of all improvements. They encourage the cultivation of the + remote, which must always be the most extensive circle of the country. + They are advantageous to the town by breaking down the monopoly of the + country in its neighbourhood. They are advantageous even to that part of + the country. Though they introduce some rival commodities into the old + market, they open many new markets to its produce. Monopoly, besides, is a + great enemy to good management, which can never be universally + established, but in consequence of that free and universal competition + which forces every body to have recourse to it for the sake of self + defence. It is not more than fifty years ago, that some of the counties in + the neighbourhood of London petitioned the parliament against the + extension of the turnpike roads into the remoter counties. Those remoter + counties, they pretended, from the cheapness of labour, would be able to + sell their grass and corn cheaper in the London market than themselves, + and would thereby reduce their rents, and ruin their cultivation. Their + rents, however, have risen, and their cultivation has been improved since + that time. + + A corn field of moderate fertility produces a much greater quantity of + food for man, than the best pasture of equal extent. Though its + cultivation requires much more labour, yet the surplus which remains after + replacing the seed and maintaining all that labour, is likewise much + greater. If a pound of butcher’s meat, therefore, was never supposed to be + worth more than a pound of bread, this greater surplus would everywhere be + of greater value and constitute a greater fund, both for the profit of the + farmer and the rent of the landlord. It seems to have done so universally + in the rude beginnings of agriculture. + + But the relative values of those two different species of food, bread and + butcher’s meat, are very different in the different periods of + agriculture. In its rude beginnings, the unimproved wilds, which then + occupy the far greater part of the country, are all abandoned to cattle. + There is more butcher’s meat than bread; and bread, therefore, is the food + for which there is the greatest competition, and which consequently brings + the greatest price. At Buenos Ayres, we are told by Ulloa, four reals, + one-and-twenty pence halfpenny sterling, was, forty or fifty years ago, + the ordinary price of an ox, chosen from a herd of two or three hundred. + He says nothing of the price of bread, probably because he found nothing + remarkable about it. An ox there, he says, costs little more than the + labour of catching him. But corn can nowhere be raised without a great + deal of labour; and in a country which lies upon the river Plate, at that + time the direct road from Europe to the silver mines of Potosi, the + money-price of labour could be very cheap. It is otherwise when + cultivation is extended over the greater part of the country. There is + then more bread than butcher’s meat. The competition changes its + direction, and the price of butcher’s meat becomes greater than the price + of bread. + + By the extension, besides, of cultivation, the unimproved wilds become + insufficient to supply the demand for butcher’s meat. A great part of the + cultivated lands must be employed in rearing and fattening cattle; of + which the price, therefore, must be sufficient to pay, not only the labour + necessary for tending them, but the rent which the landlord, and the + profit which the farmer, could have drawn from such land employed in + tillage. The cattle bred upon the most uncultivated moors, when brought to + the same market, are, in proportion to their weight or goodness, sold at + the same price as those which are reared upon the most improved land. The + proprietors of those moors profit by it, and raise the rent of their land + in proportion to the price of their cattle. It is not more than a century + ago, that in many parts of the Highlands of Scotland, butcher’s meat was + as cheap or cheaper than even bread made of oatmeal. The Union opened the + market of England to the Highland cattle. Their ordinary price, at + present, is about three times greater than at the beginning of the + century, and the rents of many Highland estates have been tripled and + quadrupled in the same time. In almost every part of Great Britain, a + pound of the best butcher’s meat is, in the present times, generally worth + more than two pounds of the best white bread; and in plentiful years it is + sometimes worth three or four pounds. + + It is thus that, in the progress of improvement, the rent and profit of + unimproved pasture come to be regulated in some measure by the rent and + profit of what is improved, and these again by the rent and profit of + corn. Corn is an annual crop; butcher’s meat, a crop which requires four + or five years to grow. As an acre of land, therefore, will produce a much + smaller quantity of the one species of food than of the other, the + inferiority of the quantity must be compensated by the superiority of the + price. If it was more than compensated, more corn-land would be turned + into pasture; and if it was not compensated, part of what was in pasture + would be brought back into corn. + + This equality, however, between the rent and profit of grass and those of + corn; of the land of which the immediate produce is food for cattle, and + of that of which the immediate produce is food for men, must be understood + to take place only through the greater part of the improved lands of a + great country. In some particular local situations it is quite otherwise, + and the rent and profit of grass are much superior to what can be made by + corn. + + Thus, in the neighbourhood of a great town, the demand for milk, and for + forage to horses, frequently contribute, together with the high price of + butcher’s meat, to raise the value of grass above what may be called its + natural proportion to that of corn. This local advantage, it is evident, + cannot be communicated to the lands at a distance. + + Particular circumstances have sometimes rendered some countries so + populous, that the whole territory, like the lands in the neighbourhood of + a great town, has not been sufficient to produce both the grass and the + corn necessary for the subsistence of their inhabitants. Their lands, + therefore, have been principally employed in the production of grass, the + more bulky commodity, and which cannot be so easily brought from a great + distance; and corn, the food of the great body of the people, has been + chiefly imported from foreign countries. Holland is at present in this + situation; and a considerable part of ancient Italy seems to have been so + during the prosperity of the Romans. To feed well, old Cato said, as we + are told by Cicero, was the first and most profitable thing in the + management of a private estate; to feed tolerably well, the second; and to + feed ill, the third. To plough, he ranked only in the fourth place of + profit and advantage. Tillage, indeed, in that part of ancient Italy which + lay in the neighbour hood of Rome, must have been very much discouraged by + the distributions of corn which were frequently made to the people, either + gratuitously, or at a very low price. This corn was brought from the + conquered provinces, of which several, instead of taxes, were obliged to + furnish a tenth part of their produce at a stated price, about sixpence + a-peck, to the republic. The low price at which this corn was distributed + to the people, must necessarily have sunk the price of what could be + brought to the Roman market from Latium, or the ancient territory of Rome, + and must have discouraged its cultivation in that country. + + In an open country, too, of which the principal produce is corn, a + well-inclosed piece of grass will frequently rent higher than any corn + field in its neighbourhood. It is convenient for the maintenance of the + cattle employed in the cultivation of the corn; and its high rent is, in + this case, not so properly paid from the value of its own produce, as from + that of the corn lands which are cultivated by means of it. It is likely + to fall, if ever the neighbouring lands are completely inclosed. The + present high rent of inclosed land in Scotland seems owing to the scarcity + of inclosure, and will probably last no longer than that scarcity. The + advantage of inclosure is greater for pasture than for corn. It saves the + labour of guarding the cattle, which feed better, too, when they are not + liable to be disturbed by their keeper or his dog. + + But where there is no local advantage of this kind, the rent and profit of + corn, or whatever else is the common vegetable food of the people, must + naturally regulate upon the land which is fit for producing it, the rent + and profit of pasture. + + The use of the artificial grasses, of turnips, carrots, cabbages, and the + other expedients which have been fallen upon to make an equal quantity of + land feed a greater number of cattle than when in natural grass, should + somewhat reduce, it might be expected, the superiority which, in an + improved country, the price of butcher’s meat naturally has over that of + bread. It seems accordingly to have done so; and there is some reason for + believing that, at least in the London market, the price of butcher’s + meat, in proportion to the price of bread, is a good deal lower in the + present times than it was in the beginning of the last century. + + In the Appendix to the life of Prince Henry, Doctor Birch has given us an + account of the prices of butcher’s meat as commonly paid by that prince. + It is there said, that the four quarters of an ox, weighing six hundred + pounds, usually cost him nine pounds ten shillings, or thereabouts; that + is thirty-one shillings and eight-pence per hundred pounds weight. Prince + Henry died on the 6th of November 1612, in the nineteenth year of his age. + + In March 1764, there was a parliamentary inquiry into the causes of the + high price of provisions at that time. It was then, among other proof to + the same purpose, given in evidence by a Virginia merchant, that in March + 1763, he had victualled his ships for twentyfour or twenty-five shillings + the hundred weight of beef, which he considered as the ordinary price; + whereas, in that dear year, he had paid twenty-seven shillings for the + same weight and sort. This high price in 1764 is, however, four shillings + and eight-pence cheaper than the ordinary price paid by Prince Henry; and + it is the best beef only, it must be observed, which is fit to be salted + for those distant voyages. + + The price paid by Prince Henry amounts to 3d. ⅘ths per pound weight of + the whole carcase, coarse and choice pieces taken together; and at that + rate the choice pieces could not have been sold by retail for less than + 4½d. or 5d. the pound. + + In the parliamentary inquiry in 1764, the witnesses stated the price of + the choice pieces of the best beef to be to the consumer 4d. and 4½d. the + pound; and the coarse pieces in general to be from seven farthings to 2½d. + and 2¾d.; and this, they said, was in general one halfpenny dearer than + the same sort of pieces had usually been sold in the month of March. But + even this high price is still a good deal cheaper than what we can well + suppose the ordinary retail price to have been in the time of Prince + Henry. + + During the first twelve years of the last century, the average price of + the best wheat at the Windsor market was £ 1:18:3½d. the quarter of nine + Winchester bushels. + + But in the twelve years preceding 1764 including that year, the average + price of the same measure of the best wheat at the same market was £ + 2:1:9½d. + + In the first twelve years of the last century, therefore, wheat appears to + have been a good deal cheaper, and butcher’s meat a good deal dearer, than + in the twelve years preceding 1764, including that year. + + In all great countries, the greater part of the cultivated lands are + employed in producing either food for men or food for cattle. The rent and + profit of these regulate the rent and profit of all other cultivated land. + If any particular produce afforded less, the land would soon be turned + into corn or pasture; and if any afforded more, some part of the lands in + corn or pasture would soon be turned to that produce. + + Those productions, indeed, which require either a greater original expense + of improvement, or a greater annual expense of cultivation in order to fit + the land for them, appear commonly to afford, the one a greater rent, the + other a greater profit, than corn or pasture. This superiority, however, + will seldom be found to amount to more than a reasonable interest or + compensation for this superior expense. + + In a hop garden, a fruit garden, a kitchen garden, both the rent of the + landlord, and the profit of the farmer, are generally greater than in + acorn or grass field. But to bring the ground into this condition requires + more expense. Hence a greater rent becomes due to the landlord. It + requires, too, a more attentive and skilful management. Hence a greater + profit becomes due to the farmer. The crop, too, at least in the hop and + fruit garden, is more precarious. Its price, therefore, besides + compensating all occasional losses, must afford something like the profit + of insurance. The circumstances of gardeners, generally mean, and always + moderate, may satisfy us that their great ingenuity is not commonly + over-recompensed. Their delightful art is practised by so many rich people + for amusement, that little advantage is to be made by those who practise + it for profit; because the persons who should naturally be their best + customers, supply themselves with all their most precious productions. + + The advantage which the landlord derives from such improvements, seems at + no time to have been greater than what was sufficient to compensate the + original expense of making them. In the ancient husbandry, after the + vineyard, a well-watered kitchen garden seems to have been the part of the + farm which was supposed to yield the most valuable produce. But + Democritus, who wrote upon husbandry about two thousand years ago, and who + was regarded by the ancients as one of the fathers of the art, thought + they did not act wisely who inclosed a kitchen garden. The profit, he + said, would not compensate the expense of a stone-wall: and bricks (he + meant, I suppose, bricks baked in the sun) mouldered with the rain and the + winter-storm, and required continual repairs. Columella, who reports this + judgment of Democritus, does not controvert it, but proposes a very frugal + method of inclosing with a hedge of brambles and briars, which he says he + had found by experience to be both a lasting and an impenetrable fence; + but which, it seems, was not commonly known in the time of Democritus. + Palladius adopts the opinion of Columella, which had before been + recommended by Varro. In the judgment of those ancient improvers, the + produce of a kitchen garden had, it seems, been little more than + sufficient to pay the extraordinary culture and the expense of watering; + for in countries so near the sun, it was thought proper, in those times as + in the present, to have the command of a stream of water, which could be + conducted to every bed in the garden. Through the greater part of Europe, + a kitchen garden is not at present supposed to deserve a better inclosure + than that recommended by Columella. In Great Britain, and some other + northern countries, the finer fruits cannot be brought to perfection but + by the assistance of a wall. Their price, therefore, in such countries, + must be sufficient to pay the expense of building and maintaining what + they cannot be had without. The fruit-wall frequently surrounds the + kitchen garden, which thus enjoys the benefit of an inclosure which its + own produce could seldom pay for. + + That the vineyard, when properly planted and brought to perfection, was + the most valuable part of the farm, seems to have been an undoubted maxim + in the ancient agriculture, as it is in the modern, through all the wine + countries. But whether it was advantageous to plant a new vineyard, was a + matter of dispute among the ancient Italian husbandmen, as we learn from + Columella. He decides, like a true lover of all curious cultivation, in + favour of the vineyard; and endeavours to shew, by a comparison of the + profit and expense, that it was a most advantageous improvement. Such + comparisons, however, between the profit and expense of new projects are + commonly very fallacious; and in nothing more so than in agriculture. Had + the gain actually made by such plantations been commonly as great as he + imagined it might have been, there could have been no dispute about it. + The same point is frequently at this day a matter of controversy in the + wine countries. Their writers on agriculture, indeed, the lovers and + promoters of high cultivation, seem generally disposed to decide with + Columella in favour of the vineyard. In France, the anxiety of the + proprietors of the old vineyards to prevent the planting of any new ones, + seems to favour their opinion, and to indicate a consciousness in those + who must have the experience, that this species of cultivation is at + present in that country more profitable than any other. It seems, at the + same time, however, to indicate another opinion, that this superior profit + can last no longer than the laws which at present restrain the free + cultivation of the vine. In 1731, they obtained an order of council, + prohibiting both the planting of new vineyards, and the renewal of these + old ones, of which the cultivation had been interrupted for two years, + without a particular permission from the king, to be granted only in + consequence of an information from the intendant of the province, + certifying that he had examined the land, and that it was incapable of any + other culture. The pretence of this order was the scarcity of corn and + pasture, and the superabundance of wine. But had this superabundance been + real, it would, without any order of council, have effectually prevented + the plantation of new vineyards, by reducing the profits of this species + of cultivation below their natural proportion to those of corn and + pasture. With regard to the supposed scarcity of corn occasioned by the + multiplication of vineyards, corn is nowhere in France more carefully + cultivated than in the wine provinces, where the land is fit for producing + it: as in Burgundy, Guienne, and the Upper Languedoc. The numerous hands + employed in the one species of cultivation necessarily encourage the + other, by affording a ready market for its produce. To diminish the number + of those who are capable of paying it, is surely a most unpromising + expedient for encouraging the cultivation of corn. It is like the policy + which would promote agriculture, by discouraging manufactures. + + The rent and profit of those productions, therefore, which require either + a greater original expense of improvement in order to fit the land for + them, or a greater annual expense of cultivation, though often much + superior to those of corn and pasture, yet when they do no more than + compensate such extraordinary expense, are in reality regulated by the + rent and profit of those common crops. + + It sometimes happens, indeed, that the quantity of land which can be + fitted for some particular produce, is too small to supply the effectual + demand. The whole produce can be disposed of to those who are willing to + give somewhat more than what is sufficient to pay the whole rent, wages, + and profit, necessary for raising and bringing it to market, according to + their natural rates, or according to the rates at which they are paid in + the greater part of other cultivated land. The surplus part of the price + which remains after defraying the whole expense of improvement and + cultivation, may commonly, in this case, and in this case only, bear no + regular proportion to the like surplus in corn or pasture, but may exceed + it in almost any degree; and the greater part of this excess naturally + goes to the rent of the landlord. + + The usual and natural proportion, for example, between the rent and profit + of wine, and those of corn and pasture, must be understood to take place + only with regard to those vineyards which produce nothing but good common + wine, such as can be raised almost anywhere, upon any light, gravelly, or + sandy soil, and which has nothing to recommend it but its strength and + wholesomeness. It is with such vineyards only, that the common land of the + country can be brought into competition; for with those of a peculiar + quality it is evident that it cannot. + + The vine is more affected by the difference of soils than any other + fruit-tree. From some it derives a flavour which no culture or management + can equal, it is supposed, upon any other. This flavour, real or + imaginary, is sometimes peculiar to the produce of a few vineyards; + sometimes it extends through the greater part of a small district, and + sometimes through a considerable part of a large province. The whole + quantity of such wines that is brought to market falls short of the + effectual demand, or the demand of those who would be willing to pay the + whole rent, profit, and wages, necessary for preparing and bringing them + thither, according to the ordinary rate, or according to the rate at which + they are paid in common vineyards. The whole quantity, therefore, can be + disposed of to those who are willing to pay more, which necessarily raises + their price above that of common wine. The difference is greater or less, + according as the fashionableness and scarcity of the wine render the + competition of the buyers more or less eager. Whatever it be, the greater + part of it goes to the rent of the landlord. For though such vineyards are + in general more carefully cultivated than most others, the high price of + the wine seems to be, not so much the effect, as the cause of this careful + cultivation. In so valuable a produce, the loss occasioned by negligence + is so great, as to force even the most careless to attention. A small part + of this high price, therefore, is sufficient to pay the wages of the + extraordinary labour bestowed upon their cultivation, and the profits of + the extraordinary stock which puts that labour into motion. + + The sugar colonies possessed by the European nations in the West Indies + may be compared to those precious vineyards. Their whole produce falls + short of the effectual demand of Europe, and can be disposed of to those + who are willing to give more than what is sufficient to pay the whole + rent, profit, and wages, necessary for preparing and bringing it to + market, according to the rate at which they are commonly paid by any other + produce. In Cochin China, the finest white sugar generally sells for three + piastres the quintal, about thirteen shillings and sixpence of our money, + as we are told by Mr Poivre {Voyages d’un Philosophe.}, a very careful + observer of the agriculture of that country. What is there called the + quintal, weighs from a hundred and fifty to two hundred Paris pounds, or a + hundred and seventy-five Paris pounds at a medium, which reduces the price + of the hundred weight English to about eight shillings sterling; not a + fourth part of what is commonly paid for the brown or muscovada sugars + imported from our colonies, and not a sixth part of what is paid for the + finest white sugar. The greater part of the cultivated lands in Cochin + China are employed in producing corn and rice, the food of the great body + of the people. The respective prices of corn, rice, and sugar, are there + probably in the natural proportion, or in that which naturally takes place + in the different crops of the greater part of cultivated land, and which + recompenses the landlord and farmer, as nearly as can be computed, + according to what is usually the original expense of improvement, and the + annual expense of cultivation. But in our sugar colonies, the price of + sugar bears no such proportion to that of the produce of a rice or corn + field either in Europe or America. It is commonly said that a sugar + planter expects that the rum and the molasses should defray the whole + expense of his cultivation, and that his sugar should be all clear profit. + If this be true, for I pretend not to affirm it, it is as if a corn farmer + expected to defray the expense of his cultivation with the chaff and the + straw, and that the grain should be all clear profit. We see frequently + societies of merchants in London, and other trading towns, purchase waste + lands in our sugar colonies, which they expect to improve and cultivate + with profit, by means of factors and agents, notwithstanding the great + distance and the uncertain returns, from the defective administration of + justice in those countries. Nobody will attempt to improve and cultivate + in the same manner the most fertile lands of Scotland, Ireland, or the + corn provinces of North America, though, from the more exact + administration of justice in these countries, more regular returns might + be expected. + + In Virginia and Maryland, the cultivation of tobacco is preferred, as most + profitable, to that of corn. Tobacco might be cultivated with advantage + through the greater part of Europe; but, in almost every part of Europe, + it has become a principal subject of taxation; and to collect a tax from + every different farm in the country where this plant might happen to be + cultivated, would be more difficult, it has been supposed, than to levy + one upon its importation at the custom-house. The cultivation of tobacco + has, upon this account, been most absurdly prohibited through the greater + part of Europe, which necessarily gives a sort of monopoly to the + countries where it is allowed; and as Virginia and Maryland produce the + greatest quantity of it, they share largely, though with some competitors, + in the advantage of this monopoly. The cultivation of tobacco, however, + seems not to be so advantageous as that of sugar. I have never even heard + of any tobacco plantation that was improved and cultivated by the capital + of merchants who resided in Great Britain; and our tobacco colonies send + us home no such wealthy planters as we see frequently arrive from our + sugar islands. Though, from the preference given in those colonies to the + cultivation of tobacco above that of corn, it would appear that the + effectual demand of Europe for tobacco is not completely supplied, it + probably is more nearly so than that for sugar; and though the present + price of tobacco is probably more than sufficient to pay the whole rent, + wages, and profit, necessary for preparing and bringing it to market, + according to the rate at which they are commonly paid in corn land, it + must not be so much more as the present price of sugar. Our tobacco + planters, accordingly, have shewn the same fear of the superabundance of + tobacco, which the proprietors of the old vineyards in France have of the + superabundance of wine. By act of assembly, they have restrained its + cultivation to six thousand plants, supposed to yield a thousand weight of + tobacco, for every negro between sixteen and sixty years of age. Such a + negro, over and above this quantity of tobacco, can manage, they reckon, + four acres of Indian corn. To prevent the market from being overstocked, + too, they have sometimes, in plentiful years, we are told by Dr Douglas + {Douglas’s Summary, vol. ii. p. 379, 373.} (I suspect he has been ill + informed), burnt a certain quantity of tobacco for every negro, in the + same manner as the Dutch are said to do of spices. If such violent methods + are necessary to keep up the present price of tobacco, the superior + advantage of its culture over that of corn, if it still has any, will not + probably be of long continuance. + + It is in this manner that the rent of the cultivated land, of which the + produce is human food, regulates the rent of the greater part of other + cultivated land. No particular produce can long afford less, because the + land would immediately be turned to another use; and if any particular + produce commonly affords more, it is because the quantity of land which + can be fitted for it is too small to supply the effectual demand. + + In Europe, corn is the principal produce of land, which serves immediately + for human food. Except in particular situations, therefore, the rent of + corn land regulates in Europe that of all other cultivated land. Britain + need envy neither the vineyards of France, nor the olive plantations of + Italy. Except in particular situations, the value of these is regulated by + that of corn, in which the fertility of Britain is not much inferior to + that of either of those two countries. + + If, in any country, the common and favourite vegetable food of the people + should be drawn from a plant of which the most common land, with the same, + or nearly the same culture, produced a much greater quantity than the most + fertile does of corn; the rent of the landlord, or the surplus quantity of + food which would remain to him, after paying the labour, and replacing the + stock of the farmer, together with its ordinary profits, would necessarily + be much greater. Whatever was the rate at which labour was commonly + maintained in that country, this greater surplus could always maintain a + greater quantity of it, and, consequently, enable the landlord to purchase + or command a greater quantity of it. The real value of his rent, his real + power and authority, his command of the necessaries and conveniencies of + life with which the labour of other people could supply him, would + necessarily be much greater. + + A rice field produces a much greater quantity of food than the most + fertile corn field. Two crops in the year, from thirty to sixty bushels + each, are said to be the ordinary produce of an acre. Though its + cultivation, therefore, requires more labour, a much greater surplus + remains after maintaining all that labour. In those rice countries, + therefore, where rice is the common and favourite vegetable food of the + people, and where the cultivators are chiefly maintained with it, a + greater share of this greater surplus should belong to the landlord than + in corn countries. In Carolina, where the planters, as in other British + colonies, are generally both farmers and landlords, and where rent, + consequently, is confounded with profit, the cultivation of rice is found + to be more profitable than that of corn, though their fields produce only + one crop in the year, and though, from the prevalence of the customs of + Europe, rice is not there the common and favourite vegetable food of the + people. + + A good rice field is a bog at all seasons, and at one season a bog covered + with water. It is unfit either for corn, or pasture, or vineyard, or, + indeed, for any other vegetable produce that is very useful to men; and + the lands which are fit for those purposes are not fit for rice. Even in + the rice countries, therefore, the rent of rice lands cannot regulate the + rent of the other cultivated land which can never be turned to that + produce. + + The food produced by a field of potatoes is not inferior in quantity to + that produced by a field of rice, and much superior to what is produced by + a field of wheat. Twelve thousand weight of potatoes from an acre of land + is not a greater produce than two thousand weight of wheat. The food or + solid nourishment, indeed, which can be drawn from each of those two + plants, is not altogether in proportion to their weight, on account of the + watery nature of potatoes. Allowing, however, half the weight of this root + to go to water, a very large allowance, such an acre of potatoes will + still produce six thousand weight of solid nourishment, three times the + quantity produced by the acre of wheat. An acre of potatoes is cultivated + with less expense than an acre of wheat; the fallow, which generally + precedes the sowing of wheat, more than compensating the hoeing and other + extraordinary culture which is always given to potatoes. Should this root + ever become in any part of Europe, like rice in some rice countries, the + common and favourite vegetable food of the people, so as to occupy the + same proportion of the lands in tillage, which wheat and other sorts of + grain for human food do at present, the same quantity of cultivated land + would maintain a much greater number of people; and the labourers being + generally fed with potatoes, a greater surplus would remain after + replacing all the stock, and maintaining all the labour employed in + cultivation. A greater share of this surplus, too, would belong to the + landlord. Population would increase, and rents would rise much beyond what + they are at present. + + The land which is fit for potatoes, is fit for almost every other useful + vegetable. If they occupied the same proportion of cultivated land which + corn does at present, they would regulate, in the same manner, the rent of + the greater part of other cultivated land. + + In some parts of Lancashire, it is pretended, I have been told, that bread + of oatmeal is a heartier food for labouring people than wheaten bread, and + I have frequently heard the same doctrine held in Scotland. I am, however, + somewhat doubtful of the truth of it. The common people in Scotland, who + are fed with oatmeal, are in general neither so strong nor so handsome as + the same rank of people in England, who are fed with wheaten bread. They + neither work so well, nor look so well; and as there is not the same + difference between the people of fashion in the two countries, experience + would seem to shew, that the food of the common people in Scotland is not + so suitable to the human constitution as that of their neighbours of the + same rank in England. But it seems to be otherwise with potatoes. The + chairmen, porters, and coal-heavers in London, and those unfortunate women + who live by prostitution, the strongest men and the most beautiful women + perhaps in the British dominions, are said to be, the greater part of + them, from the lowest rank of people in Ireland, who are generally fed + with this root. No food can afford a more decisive proof of its nourishing + quality, or of its being peculiarly suitable to the health of the human + constitution. + + It is difficult to preserve potatoes through the year, and impossible to + store them like corn, for two or three years together. The fear of not + being able to sell them before they rot, discourages their cultivation, + and is, perhaps, the chief obstacle to their ever becoming in any great + country, like bread, the principal vegetable food of all the different + ranks of the people. + + + + + PART II.—Of the Produce of Land, which sometimes does, and sometimes + does not, afford Rent. + + Human food seems to be the only produce of land, which always and + necessarily affords some rent to the landlord. Other sorts of produce + sometimes may, and sometimes may not, according to different + circumstances. + + After food, clothing and lodging are the two great wants of mankind. + + Land, in its original rude state, can afford the materials of clothing and + lodging to a much greater number of people than it can feed. In its + improved state, it can sometimes feed a greater number of people than it + can supply with those materials; at least in the way in which they require + them, and are willing to pay for them. In the one state, therefore, there + is always a superabundance of these materials, which are frequently, upon + that account, of little or no value. In the other, there is often a + scarcity, which necessarily augments their value. In the one state, a + great part of them is thrown away as useless and the price of what is used + is considered as equal only to the labour and expense of fitting it for + use, and can, therefore, afford no rent to the landlord. In the other, + they are all made use of, and there is frequently a demand for more than + can be had. Somebody is always willing to give more for every part of + them, than what is sufficient to pay the expense of bringing them to + market. Their price, therefore, can always afford some rent to the + landlord. + + The skins of the larger animals were the original materials of clothing. + Among nations of hunters and shepherds, therefore, whose food consists + chiefly in the flesh of those animals, everyman, by providing himself with + food, provides himself with the materials of more clothing than he can + wear. If there was no foreign commerce, the greater part of them would be + thrown away as things of no value. This was probably the case among the + hunting nations of North America, before their country was discovered by + the Europeans, with whom they now exchange their surplus peltry, for + blankets, fire-arms, and brandy, which gives it some value. In the present + commercial state of the known world, the most barbarous nations, I + believe, among whom land property is established, have some foreign + commerce of this kind, and find among their wealthier neighbours such a + demand for all the materials of clothing, which their land produces, and + which can neither be wrought up nor consumed at home, as raises their + price above what it costs to send them to those wealthier neighbours. It + affords, therefore, some rent to the landlord. When the greater part of + the Highland cattle were consumed on their own hills, the exportation of + their hides made the most considerable article of the commerce of that + country, and what they were exchanged for afforded some addition to the + rent of the Highland estates. The wool of England, which in old times, + could neither be consumed nor wrought up at home, found a market in the + then wealthier and more industrious country of Flanders, and its price + afforded something to the rent of the land which produced it. In countries + not better cultivated than England was then, or than the Highlands of + Scotland are now, and which had no foreign commerce, the materials of + clothing would evidently be so superabundant, that a great part of them + would be thrown away as useless, and no part could afford any rent to the + landlord. + + The materials of lodging cannot always be transported to so great a + distance as those of clothing, and do not so readily become an object of + foreign commerce. When they are superabundant in the country which + produces them, it frequently happens, even in the present commercial state + of the world, that they are of no value to the landlord. A good stone + quarry in the neighbourhood of London would afford a considerable rent. In + many parts of Scotland and Wales it affords none. Barren timber for + building is of great value in a populous and well-cultivated country, and + the land which produces it affords a considerable rent. But in many parts + of North America, the landlord would be much obliged to any body who would + carry away the greater part of his large trees. In some parts of the + Highlands of Scotland, the bark is the only part of the wood which, for + want of roads and water-carriage, can be sent to market; the timber is + left to rot upon the ground. When the materials of lodging are so + superabundant, the part made use of is worth only the labour and expense + of fitting it for that use. It affords no rent to the landlord, who + generally grants the use of it to whoever takes the trouble of asking it. + The demand of wealthier nations, however, sometimes enables him to get a + rent for it. The paving of the streets of London has enabled the owners of + some barren rocks on the coast of Scotland to draw a rent from what never + afforded any before. The woods of Norway, and of the coasts of the Baltic, + find a market in many parts of Great Britain, which they could not find at + home, and thereby afford some rent to their proprietors. + + Countries are populous, not in proportion to the number of people whom + their produce can clothe and lodge, but in proportion to that of those + whom it can feed. When food is provided, it is easy to find the necessary + clothing and lodging. But though these are at hand, it may often be + difficult to find food. In some parts of the British dominions, what is + called a house may be built by one day’s labour of one man. The simplest + species of clothing, the skins of animals, require somewhat more labour to + dress and prepare them for use. They do not, however, require a great + deal. Among savage or barbarous nations, a hundredth, or little more than + a hundredth part of the labour of the whole year, will be sufficient to + provide them with such clothing and lodging as satisfy the greater part of + the people. All the other ninety-nine parts are frequently no more than + enough to provide them with food. + + But when, by the improvement and cultivation of land, the labour of one + family can provide food for two, the labour of half the society becomes + sufficient to provide food for the whole. The other half, therefore, or at + least the greater part of them, can be employed in providing other things, + or in satisfying the other wants and fancies of mankind. Clothing and + lodging, household furniture, and what is called equipage, are the + principal objects of the greater part of those wants and fancies. The rich + man consumes no more food than his poor neighbour. In quality it may be + very different, and to select and prepare it may require more labour and + art; but in quantity it is very nearly the same. But compare the spacious + palace and great wardrobe of the one, with the hovel and the few rags of + the other, and you will be sensible that the difference between their + clothing, lodging, and household furniture, is almost as great in quantity + as it is in quality. The desire of food is limited in every man by the + narrow capacity of the human stomach; but the desire of the conveniencies + and ornaments of building, dress, equipage, and household furniture, seems + to have no limit or certain boundary. Those, therefore, who have the + command of more food than they themselves can consume, are always willing + to exchange the surplus, or, what is the same thing, the price of it, for + gratifications of this other kind. What is over and above satisfying the + limited desire, is given for the amusement of those desires which cannot + be satisfied, but seem to be altogether endless. The poor, in order to + obtain food, exert themselves to gratify those fancies of the rich; and to + obtain it more certainly, they vie with one another in the cheapness and + perfection of their work. The number of workmen increases with the + increasing quantity of food, or with the growing improvement and + cultivation of the lands; and as the nature of their business admits of + the utmost subdivisions of labour, the quantity of materials which they + can work up, increases in a much greater proportion than their numbers. + Hence arises a demand for every sort of material which human invention can + employ, either usefully or ornamentally, in building, dress, equipage, or + household furniture; for the fossils and minerals contained in the bowels + of the earth, the precious metals, and the precious stones. + + Food is, in this manner, not only the original source of rent, but every + other part of the produce of land which afterwards affords rent, derives + that part of its value from the improvement of the powers of labour in + producing food, by means of the improvement and cultivation of land. + + Those other parts of the produce of land, however, which afterwards afford + rent, do not afford it always. Even in improved and cultivated countries, + the demand for them is not always such as to afford a greater price than + what is sufficient to pay the labour, and replace, together with its + ordinary profits, the stock which must be employed in bringing them to + market. Whether it is or is not such, depends upon different + circumstances. + + Whether a coal mine, for example, can afford any rent, depends partly upon + its fertility, and partly upon its situation. + + A mine of any kind may be said to be either fertile or barren, according + as the quantity of mineral which can be brought from it by a certain + quantity of labour, is greater or less than what can be brought by an + equal quantity from the greater part of other mines of the same kind. + + Some coal mines, advantageously situated, cannot be wrought on account of + their barrenness. The produce does not pay the expense. They can afford + neither profit nor rent. + + There are some, of which the produce is barely sufficient to pay the + labour, and replace, together with its ordinary profits, the stock + employed in working them. They afford some profit to the undertaker of the + work, but no rent to the landlord. They can be wrought advantageously by + nobody but the landlord, who, being himself the undertaker of the work, + gets the ordinary profit of the capital which he employs in it. Many coal + mines in Scotland are wrought in this manner, and can be wrought in no + other. The landlord will allow nobody else to work them without paying + some rent, and nobody can afford to pay any. + + Other coal mines in the same country, sufficiently fertile, cannot be + wrought on account of their situation. A quantity of mineral, sufficient + to defray the expense of working, could be brought from the mine by the + ordinary, or even less than the ordinary quantity of labour: but in an + inland country, thinly inhabited, and without either good roads or + water-carriage, this quantity could not be sold. + + Coals are a less agreeable fuel than wood: they are said too to be less + wholesome. The expense of coals, therefore, at the place where they are + consumed, must generally be somewhat less than that of wood. + + The price of wood, again, varies with the state of agriculture, nearly in + the same manner, and exactly for the same reason, as the price of cattle. + In its rude beginnings, the greater part of every country is covered with + wood, which is then a mere incumbrance, of no value to the landlord, who + would gladly give it to any body for the cutting. As agriculture advances, + the woods are partly cleared by the progress of tillage, and partly go to + decay in consequence of the increased number of cattle. These, though they + do not increase in the same proportion as corn, which is altogether the + acquisition of human industry, yet multiply under the care and protection + of men, who store up in the season of plenty what may maintain them in + that of scarcity; who, through the whole year, furnish them with a greater + quantity of food than uncultivated nature provides for them; and who, by + destroying and extirpating their enemies, secure them in the free + enjoyment of all that she provides. Numerous herds of cattle, when allowed + to wander through the woods, though they do not destroy the old trees, + hinder any young ones from coming up; so that, in the course of a century + or two, the whole forest goes to ruin. The scarcity of wood then raises + its price. It affords a good rent; and the landlord sometimes finds that + he can scarce employ his best lands more advantageously than in growing + barren timber, of which the greatness of the profit often compensates the + lateness of the returns. This seems, in the present times, to be nearly + the state of things in several parts of Great Britain, where the profit of + planting is found to be equal to that of either corn or pasture. The + advantage which the landlord derives from planting can nowhere exceed, at + least for any considerable time, the rent which these could afford him; + and in an inland country, which is highly cultivated, it will frequently + not fall much short of this rent. Upon the sea-coast of a well-improved + country, indeed, if coals can conveniently be had for fuel, it may + sometimes be cheaper to bring barren timber for building from less + cultivated foreign countries than to raise it at home. In the new town of + Edinburgh, built within these few years, there is not, perhaps, a single + stick of Scotch timber. + + Whatever may be the price of wood, if that of coals is such that the + expense of a coal fire is nearly equal to that of a wood one we may be + assured, that at that place, and in these circumstances, the price of + coals is as high as it can be. It seems to be so in some of the inland + parts of England, particularly in Oxfordshire, where it is usual, even in + the fires of the common people, to mix coals and wood together, and where + the difference in the expense of those two sorts of fuel cannot, + therefore, be very great. Coals, in the coal countries, are everywhere + much below this highest price. If they were not, they could not bear the + expense of a distant carriage, either by land or by water. A small + quantity only could be sold; and the coal masters and the coal proprietors + find it more for their interest to sell a great quantity at a price + somewhat above the lowest, than a small quantity at the highest. The most + fertile coal mine, too, regulates the price of coals at all the other + mines in its neighbourhood. Both the proprietor and the undertaker of the + work find, the one that he can get a greater rent, the other that he can + get a greater profit, by somewhat underselling all their neighbours. Their + neighbours are soon obliged to sell at the same price, though they cannot + so well afford it, and though it always diminishes, and sometimes takes + away altogether, both their rent and their profit. Some works are + abandoned altogether; others can afford no rent, and can be wrought only + by the proprietor. + + The lowest price at which coals can be sold for any considerable time, is, + like that of all other commodities, the price which is barely sufficient + to replace, together with its ordinary profits, the stock which must be + employed in bringing them to market. At a coal mine for which the landlord + can get no rent, but, which he must either work himself or let it alone + altogether, the price of coals must generally be nearly about this price. + + Rent, even where coals afford one, has generally a smaller share in their + price than in that of most other parts of the rude produce of land. The + rent of an estate above ground, commonly amounts to what is supposed to be + a third of the gross produce; and it is generally a rent certain and + independent of the occasional variations in the crop. In coal mines, a + fifth of the gross produce is a very great rent, a tenth the common rent; + and it is seldom a rent certain, but depends upon the occasional + variations in the produce. These are so great, that in a country where + thirty years purchase is considered as a moderate price for the property + of a landed estate, ten years purchase is regarded as a good price for + that of a coal mine. + + The value of a coal mine to the proprietor, frequently depends as much + upon its situation as upon its fertility. That of a metallic mine depends + more upon its fertility, and less upon its situation. The coarse, and + still more the precious metals, when separated from the ore, are so + valuable, that they can generally bear the expense of a very long land, + and of the most distant sea carriage. Their market is not confined to the + countries in the neighbourhood of the mine, but extends to the whole + world. The copper of Japan makes an article of commerce in Europe; the + iron of Spain in that of Chili and Peru. The silver of Peru finds its way, + not only to Europe, but from Europe to China. + + The price of coals in Westmoreland or Shropshire can have little effect on + their price at Newcastle; and their price in the Lionnois can have none at + all. The productions of such distant coal mines can never be brought into + competition with one another. But the productions of the most distant + metallic mines frequently may, and in fact commonly are. + + The price, therefore, of the coarse, and still more that of the precious + metals, at the most fertile mines in the world, must necessarily more or + less affect their price at every other in it. The price of copper in Japan + must have some influence upon its price at the copper mines in Europe. The + price of silver in Peru, or the quantity either of labour or of other + goods which it will purchase there, must have some influence on its price, + not only at the silver mines of Europe, but at those of China. After the + discovery of the mines of Peru, the silver mines of Europe were, the + greater part of them, abandoned. The value of silver was so much reduced, + that their produce could no longer pay the expense of working them, or + replace, with a profit, the food, clothes, lodging, and other necessaries + which were consumed in that operation. This was the case, too, with the + mines of Cuba and St. Domingo, and even with the ancient mines of Peru, + after the discovery of those of Potosi. The price of every metal, at every + mine, therefore, being regulated in some measure by its price at the most + fertile mine in the world that is actually wrought, it can, at the greater + part of mines, do very little more than pay the expense of working, and + can seldom afford a very high rent to the landlord. Rent accordingly, + seems at the greater part of mines to have but a small share in the price + of the coarse, and a still smaller in that of the precious metals. Labour + and profit make up the greater part of both. + + A sixth part of the gross produce may be reckoned the average rent of the + tin mines of Cornwall, the most fertile that are known in the world, as we + are told by the Rev. Mr Borlace, vice-warden of the stannaries. Some, he + says, afford more, and some do not afford so much. A sixth part of the + gross produce is the rent, too, of several very fertile lead mines in + Scotland. + + In the silver mines of Peru, we are told by Frezier and Ulloa, the + proprietor frequently exacts no other acknowledgment from the undertaker + of the mine, but that he will grind the ore at his mill, paying him the + ordinary multure or price of grinding. Till 1736, indeed, the tax of the + king of Spain amounted to one fifth of the standard silver, which till + then might be considered as the real rent of the greater part of the + silver mines of Peru, the richest which have been known in the world. If + there had been no tax, this fifth would naturally have belonged to the + landlord, and many mines might have been wrought which could not then be + wrought, because they could not afford this tax. The tax of the duke of + Cornwall upon tin is supposed to amount to more than five per cent. or one + twentieth part of the value; and whatever may be his proportion, it would + naturally, too, belong to the proprietor of the mine, if tin was duty + free. But if you add one twentieth to one sixth, you will find that the + whole average rent of the tin mines of Cornwall, was to the whole average + rent of the silver mines of Peru, as thirteen to twelve. But the silver + mines of Peru are not now able to pay even this low rent; and the tax upon + silver was, in 1736, reduced from one fifth to one tenth. Even this tax + upon silver, too, gives more temptation to smuggling than the tax of one + twentieth upon tin; and smuggling must be much easier in the precious than + in the bulky commodity. The tax of the king of Spain, accordingly, is said + to be very ill paid, and that of the duke of Cornwall very well. Rent, + therefore, it is probable, makes a greater part of the price of tin at the + most fertile tin mines than it does of silver at the most fertile silver + mines in the world. After replacing the stock employed in working those + different mines, together with its ordinary profits, the residue which + remains to the proprietor is greater, it seems, in the coarse, than in the + precious metal. + + Neither are the profits of the undertakers of silver mines commonly very + great in Peru. The same most respectable and well-informed authors + acquaint us, that when any person undertakes to work a new mine in Peru, + he is universally looked upon as a man destined to bankruptcy and ruin, + and is upon that account shunned and avoided by every body. Mining, it + seems, is considered there in the same light as here, as a lottery, in + which the prizes do not compensate the blanks, though the greatness of + some tempts many adventurers to throw away their fortunes in such + unprosperous projects. + + As the sovereign, however, derives a considerable part of his revenue from + the produce of silver mines, the law in Peru gives every possible + encouragement to the discovery and working of new ones. Whoever discovers + a new mine, is entitled to measure off two hundred and forty-six feet in + length, according to what he supposes to be the direction of the vein, and + half as much in breadth. He becomes proprietor of this portion of the + mine, and can work it without paving any acknowledgment to the landlord. + The interest of the duke of Cornwall has given occasion to a regulation + nearly of the same kind in that ancient dutchy. In waste and uninclosed + lands, any person who discovers a tin mine may mark out its limits to a + certain extent, which is called bounding a mine. The bounder becomes the + real proprietor of the mine, and may either work it himself, or give it in + lease to another, without the consent of the owner of the land, to whom, + however, a very small acknowledgment must be paid upon working it. In both + regulations, the sacred rights of private property are sacrificed to the + supposed interests of public revenue. + + The same encouragement is given in Peru to the discovery and working of + new gold mines; and in gold the king’s tax amounts only to a twentieth + part of the standard rental. It was once a fifth, and afterwards a tenth, + as in silver; but it was found that the work could not bear even the + lowest of these two taxes. If it is rare, however, say the same authors, + Frezier and Ulloa, to find a person who has made his fortune by a silver, + it is still much rarer to find one who has done so by a gold mine. This + twentieth part seems to be the whole rent which is paid by the greater + part of the gold mines of Chili and Peru. Gold, too, is much more liable + to be smuggled than even silver; not only on account of the superior value + of the metal in proportion to its bulk, but on account of the peculiar way + in which nature produces it. Silver is very seldom found virgin, but, like + most other metals, is generally mineralized with some other body, from + which it is impossible to separate it in such quantities as will pay for + the expense, but by a very laborious and tedious operation, which cannot + well be carried on but in work-houses erected for the purpose, and, + therefore, exposed to the inspection of the king’s officers. Gold, on the + contrary, is almost always found virgin. It is sometimes found in pieces + of some bulk; and, even when mixed, in small and almost insensible + particles, with sand, earth, and other extraneous bodies, it can be + separated from them by a very short and simple operation, which can be + carried on in any private house by any body who is possessed of a small + quantity of mercury. If the king’s tax, therefore, is but ill paid upon + silver, it is likely to be much worse paid upon gold; and rent must make a + much smaller part of the price of gold than that of silver. + + The lowest price at which the precious metals can be sold, or the smallest + quantity of other goods for which they can be exchanged, during any + considerable time, is regulated by the same principles which fix the + lowest ordinary price of all other goods. The stock which must commonly be + employed, the food, clothes, and lodging, which must commonly be consumed + in bringing them from the mine to the market, determine it. It must at + least be sufficient to replace that stock, with the ordinary profits. + + Their highest price, however, seems not to be necessarily determined by + any thing but the actual scarcity or plenty of these metals themselves. It + is not determined by that of any other commodity, in the same manner as + the price of coals is by that of wood, beyond which no scarcity can ever + raise it. Increase the scarcity of gold to a certain degree, and the + smallest bit of it may become more precious than a diamond, and exchange + for a greater quantity of other goods. + + The demand for those metals arises partly from their utility, and partly + from their beauty. If you except iron, they are more useful than, perhaps, + any other metal. As they are less liable to rust and impurity, they can + more easily be kept clean; and the utensils, either of the table or the + kitchen, are often, upon that account, more agreeable when made of them. A + silver boiler is more cleanly than a lead, copper, or tin one; and the + same quality would render a gold boiler still better than a silver one. + Their principal merit, however, arises from their beauty, which renders + them peculiarly fit for the ornaments of dress and furniture. No paint or + dye can give so splendid a colour as gilding. The merit of their beauty is + greatly enhanced by their scarcity. With the greater part of rich people, + the chief enjoyment of riches consists in the parade of riches; which, in + their eye, is never so complete as when they appear to possess those + decisive marks of opulence which nobody can possess but themselves. In + their eyes, the merit of an object, which is in any degree either useful + or beautiful, is greatly enhanced by its scarcity, or by the great labour + which it requires to collect any considerable quantity of it; a labour + which nobody can afford to pay but themselves. Such objects they are + willing to purchase at a higher price than things much more beautiful and + useful, but more common. These qualities of utility, beauty, and scarcity, + are the original foundation of the high price of those metals, or of the + great quantity of other goods for which they can everywhere be exchanged. + This value was antecedent to, and independent of their being employed as + coin, and was the quality which fitted them for that employment. That + employment, however, by occasioning a new demand, and by diminishing the + quantity which could be employed in any other way, may have afterwards + contributed to keep up or increase their value. + + The demand for the precious stones arises altogether from their beauty. + They are of no use but as ornaments; and the merit of their beauty is + greatly enhanced by their scarcity, or by the difficulty and expense of + getting them from the mine. Wages and profit accordingly make up, upon + most occasions, almost the whole of the high price. Rent comes in but for + a very small share, frequently for no share; and the most fertile mines + only afford any considerable rent. When Tavernier, a jeweller, visited the + diamond mines of Golconda and Visiapour, he was informed that the + sovereign of the country, for whose benefit they were wrought, had ordered + all of them to be shut up except those which yielded the largest and + finest stones. The other, it seems, were to the proprietor not worth the + working. + + As the prices, both of the precious metals and of the precious stones, is + regulated all over the world by their price at the most fertile mine in + it, the rent which a mine of either can afford to its proprietor is in + proportion, not to its absolute, but to what may be called its relative + fertility, or to its superiority over other mines of the same kind. If new + mines were discovered, as much superior to those of Potosi, as they were + superior to those of Europe, the value of silver might be so much degraded + as to render even the mines of Potosi not worth the working. Before the + discovery of the Spanish West Indies, the most fertile mines in Europe may + have afforded as great a rent to their proprietors as the richest mines in + Peru do at present. Though the quantity of silver was much less, it might + have exchanged for an equal quantity of other goods, and the proprietor’s + share might have enabled him to purchase or command an equal quantity + either of labour or of commodities. + + The value, both of the produce and of the rent, the real revenue which + they afforded, both to the public and to the proprietor, might have been + the same. + + The most abundant mines, either of the precious metals, or of the precious + stones, could add little to the wealth of the world. A produce, of which + the value is principally derived from its scarcity, is necessarily + degraded by its abundance. A service of plate, and the other frivolous + ornaments of dress and furniture, could be purchased for a smaller + quantity of commodities; and in this would consist the sole advantage + which the world could derive from that abundance. + + It is otherwise in estates above ground. The value, both of their produce + and of their rent, is in proportion to their absolute, and not to their + relative fertility. The land which produces a certain quantity of food, + clothes, and lodging, can always feed, clothe, and lodge, a certain number + of people; and whatever may be the proportion of the landlord, it will + always give him a proportionable command of the labour of those people, + and of the commodities with which that labour can supply him. The value of + the most barren land is not diminished by the neighbourhood of the most + fertile. On the contrary, it is generally increased by it. The great + number of people maintained by the fertile lands afford a market to many + parts of the produce of the barren, which they could never have found + among those whom their own produce could maintain. + + Whatever increases the fertility of land in producing food, increases not + only the value of the lands upon which the improvement is bestowed, but + contributes likewise to increase that of many other lands, by creating a + new demand for their produce. That abundance of food, of which, in + consequence of the improvement of land, many people have the disposal + beyond what they themselves can consume, is the great cause of the demand, + both for the precious metals and the precious stones, as well as for every + other conveniency and ornament of dress, lodging, household furniture, and + equipage. Food not only constitutes the principal part of the riches of + the world, but it is the abundance of food which gives the principal part + of their value to many other sorts of riches. The poor inhabitants of Cuba + and St. Domingo, when they were first discovered by the Spaniards, used to + wear little bits of gold as ornaments in their hair and other parts of + their dress. They seemed to value them as we would do any little pebbles + of somewhat more than ordinary beauty, and to consider them as just worth + the picking up, but not worth the refusing to any body who asked them, + They gave them to their new guests at the first request, without seeming + to think that they had made them any very valuable present. They were + astonished to observe the rage of the Spaniards to obtain them; and had no + notion that there could anywhere be a country in which many people had the + disposal of so great a superfluity of food; so scanty always among + themselves, that, for a very small quantity of those glittering baubles, + they would willingly give as much as might maintain a whole family for + many years. Could they have been made to understand this, the passion of + the Spaniards would not have surprised them. + + + + + PART III.—Of the variations in the Proportion between the respective + Values of that sort of Produce which always affords Rent, and of that + which sometimes does, and sometimes does not, afford Rent. + + The increasing abundance of food, in consequence of the increasing + improvement and cultivation, must necessarily increase the demand for + every part of the produce of land which is not food, and which can be + applied either to use or to ornament. In the whole progress of + improvement, it might, therefore, be expected there should be only one + variation in the comparative values of those two different sorts of + produce. The value of that sort which sometimes does, and sometimes does + not afford rent, should constantly rise in proportion to that which always + affords some rent. As art and industry advance, the materials of clothing + and lodging, the useful fossils and materials of the earth, the precious + metals and the precious stones, should gradually come to be more and more + in demand, should gradually exchange for a greater and a greater quantity + of food; or, in other words, should gradually become dearer and dearer. + This, accordingly, has been the case with most of these things upon most + occasions, and would have been the case with all of them upon all + occasions, if particular accidents had not, upon some occasions, increased + the supply of some of them in a still greater proportion than the demand. + + The value of a free-stone quarry, for example, will necessarily increase + with the increasing improvement and population of the country round about + it, especially if it should be the only one in the neighbourhood. But the + value of a silver mine, even though there should not be another within a + thousand miles of it, will not necessarily increase with the improvement + of the country in which it is situated. The market for the produce of a + free-stone quarry can seldom extend more than a few miles round about it, + and the demand must generally be in proportion to the improvement and + population of that small district; but the market for the produce of a + silver mine may extend over the whole known world. Unless the world in + general, therefore, be advancing in improvement and population, the demand + for silver might not be at all increased by the improvement even of a + large country in the neighbourhood of the mine. Even though the world in + general were improving, yet if, in the course of its improvements, new + mines should be discovered, much more fertile than any which had been + known before, though the demand for silver would necessarily increase, yet + the supply might increase in so much a greater proportion, that the real + price of that metal might gradually fall; that is, any given quantity, a + pound weight of it, for example, might gradually purchase or command a + smaller and a smaller quantity of labour, or exchange for a smaller and a + smaller quantity of corn, the principal part of the subsistence of the + labourer. + + The great market for silver is the commercial and civilized part of the + world. + + If, by the general progress of improvement, the demand of this market + should increase, while, at the same time, the supply did not increase in + the same proportion, the value of silver would gradually rise in + proportion to that of corn. Any given quantity of silver would exchange + for a greater and a greater quantity of corn; or, in other words, the + average money price of corn would gradually become cheaper and cheaper. + + If, on the contrary, the supply, by some accident, should increase, for + many years together, in a greater proportion than the demand, that metal + would gradually become cheaper and cheaper; or, in other words, the + average money price of corn would, in spite of all improvements, gradually + become dearer and dearer. + + But if, on the other hand, the supply of that metal should increase nearly + in the same proportion as the demand, it would continue to purchase or + exchange for nearly the same quantity of corn; and the average money price + of corn would, in spite of all improvements. continue very nearly the + same. + + These three seem to exhaust all the possible combinations of events which + can happen in the progress of improvement; and during the course of the + four centuries preceding the present, if we may judge by what has happened + both in France and Great Britain, each of those three different + combinations seems to have taken place in the European market, and nearly + in the same order, too, in which I have here set them down. + + _Digression concerning the Variations in the value of Silver during the + Course of the Four last Centuries._ + + + + + First Period.—In 1350, and for some time before, the average price + of the quarter of wheat in England seems not to have been estimated lower + than four ounces of silver, Tower weight, equal to about twenty shillings + of our present money. From this price it seems to have fallen gradually to + two ounces of silver, equal to about ten shillings of our present money, + the price at which we find it estimated in the beginning of the sixteenth + century, and at which it seems to have continued to be estimated till + about 1570. + + In 1350, being the 25th of Edward III. was enacted what is called the + Statute of Labourers. In the preamble, it complains much of the insolence + of servants, who endeavoured to raise their wages upon their masters. It + therefore ordains, that all servants and labourers should, for the future, + be contented with the same wages and liveries (liveries in those times + signified not only clothes, but provisions) which they had been accustomed + to receive in the 20th year of the king, and the four preceding years; + that, upon this account, their livery-wheat should nowhere be estimated + higher than tenpence a-bushel, and that it should always be in the option + of the master to deliver them either the wheat or the money. Tenpence: + a-bushel, therefore, had, in the 25th of Edward III. been reckoned a very + moderate price of wheat, since it required a particular statute to oblige + servants to accept of it in exchange for their usual livery of provisions; + and it had been reckoned a reasonable price ten years before that, or in + the 16th year of the king, the term to which the statute refers. But in + the 16th year of Edward III. tenpence contained about half an ounce of + silver, Tower weight, and was nearly equal to half-a-crown of our present + money. Four ounces of silver, Tower weight, therefore, equal to six + shillings and eightpence of the money of those times, and to near twenty + shillings of that of the present, must have been reckoned a moderate price + for the quarter of eight bushels. + + This statute is surely a better evidence of what was reckoned, in those + times, a moderate price of grain, than the prices of some particular + years, which have generally been recorded by historians and other writers, + on account of their extraordinary dearness or cheapness, and from which, + therefore, it is difficult to form any judgment concerning what may have + been the ordinary price. There are, besides, other reasons for believing + that, in the beginning of the fourteenth century, and for some time + before, the common price of wheat was not less than four ounces of silver + the quarter, and that of other grain in proportion. + + In 1309, Ralph de Born, prior of St Augustine’s, Canterbury, gave a feast + upon his installation-day, of which William Thorn has preserved, not only + the bill of fare, but the prices of many particulars. In that feast were + consumed, 1st, fifty-three quarters of wheat, which cost nineteen pounds, + or seven shillings, and twopence a-quarter, equal to about one-and-twenty + shillings and sixpence of our present money; 2dly, fifty-eight quarters of + malt, which cost seventeen pounds ten shillings, or six shillings + a-quarter, equal to about eighteen shillings of our present money; 3dly, + twenty quarters of oats, which cost four pounds, or four shillings + a-quarter, equal to about twelve shillings of our present money. The + prices of malt and oats seem here to be higher than their ordinary + proportion to the price of wheat. + + These prices are not recorded, on account of their extraordinary dearness + or cheapness, but are mentioned accidentally, as the prices actually paid + for large quantities of grain consumed at a feast, which was famous for + its magnificence. + + In 1262, being the 51st of Henry III. was revived an ancient statute, + called the assize of bread and ale, which, the king says in the preamble, + had been made in the times of his progenitors, some time kings of England. + It is probably, therefore, as old at least as the time of his grandfather, + Henry II. and may have been as old as the Conquest. It regulates the price + of bread according as the prices of wheat may happen to be, from one + shilling to twenty shillings the quarter of the money of those times. But + statutes of this kind are generally presumed to provide with equal care + for all deviations from the middle price, for those below it, as well as + for those above it. Ten shillings, therefore, containing six ounces of + silver, Tower weight, and equal to about thirty shillings of our present + money, must, upon this supposition, have been reckoned the middle price of + the quarter of wheat when this statute was first enacted, and must have + continued to be so in the 51st of Henry III. We cannot, therefore, be very + wrong in supposing that the middle price was not less than one-third of + the highest price at which this statute regulates the price of bread, or + than six shillings and eightpence of the money of those times, containing + four ounces of silver, Tower weight. + + From these different facts, therefore, we seem to have some reason to + conclude that, about the middle of the fourteenth century, and for a + considerable time before, the average or ordinary price of the quarter of + wheat was not supposed to be less than four ounces of silver, Tower + weight. + + From about the middle of the fourteenth to the beginning of the sixteenth + century, what was reckoned the reasonable and moderate, that is, the + ordinary or average price of wheat, seems to have sunk gradually to about + one half of this price; so as at last to have fallen to about two ounces + of silver, Tower weight, equal to about ten shillings of our present + money. It continued to be estimated at this price till about 1570. + + In the household book of Henry, the fifth earl of Northumberland, drawn up + in 1512 there are two different estimations of wheat. In one of them it is + computed at six shilling and eightpence the quarter, in the other at five + shillings and eightpence only. In 1512, six shillings and eightpence + contained only two ounces of silver, Tower weight, and were equal to about + ten shillings of our present money. + + From the 25th of Edward III. to the beginning of the reign of Elizabeth, + during the space of more than two hundred years, six shillings and + eightpence, it appears from several different statutes, had continued to + be considered as what is called the moderate and reasonable, that is, the + ordinary or average price of wheat. The quantity of silver, however, + contained in that nominal sum was, during the course of this period, + continually diminishing in consequence of some alterations which were made + in the coin. But the increase of the value of silver had, it seems, so far + compensated the diminution of the quantity of it contained in the same + nominal sum, that the legislature did not think it worth while to attend + to this circumstance. + + Thus, in 1436, it was enacted, that wheat might be exported without a + licence when the price was so low as six shillings and eightpence: and in + 1463, it was enacted, that no wheat should be imported if the price was + not above six shillings and eightpence the quarter: The legislature had + imagined, that when the price was so low, there could be no inconveniency + in exportation, but that when it rose higher, it became prudent to allow + of importation. Six shillings and eightpence, therefore, containing about + the same quantity of silver as thirteen shillings and fourpence of our + present money (one-third part less than the same nominal sum contained in + the time of Edward III), had, in those times, been considered as what is + called the moderate and reasonable price of wheat. + + In 1554, by the 1st and 2nd of Philip and Mary, and in 1558, by the 1st of + Elizabeth, the exportation of wheat was in the same manner prohibited, + whenever the price of the quarter should exceed six shillings and + eightpence, which did not then contain two penny worth more silver than + the same nominal sum does at present. But it had soon been found, that to + restrain the exportation of wheat till the price was so very low, was, in + reality, to prohibit it altogether. In 1562, therefore, by the 5th of + Elizabeth, the exportation of wheat was allowed from certain ports, + whenever the price of the quarter should not exceed ten shillings, + containing nearly the same quantity of silver as the like nominal sum does + at present. This price had at this time, therefore, been considered as + what is called the moderate and reasonable price of wheat. It agrees + nearly with the estimation of the Northumberland book in 1512. + + That in France the average price of grain was, in the same manner, much + lower in the end of the fifteenth and beginning of the sixteenth century, + than in the two centuries preceding, has been observed both by Mr Dupré de + St Maur, and by the elegant author of the Essay on the Policy of Grain. + Its price, during the same period, had probably sunk in the same manner + through the greater part of Europe. + + This rise in the value of silver, in proportion to that of corn, may + either have been owing altogether to the increase of the demand for that + metal, in consequence of increasing improvement and cultivation, the + supply, in the mean time, continuing the same as before; or, the demand + continuing the same as before, it may have been owing altogether to the + gradual diminution of the supply: the greater part of the mines which were + then known in the world being much exhausted, and, consequently, the + expense of working them much increased; or it may have been owing partly + to the one, and partly to the other of those two circumstances. In the end + of the fifteenth and beginning of the sixteenth centuries, the greater + part of Europe was approaching towards a more settled form of government + than it had enjoyed for several ages before. The increase of security + would naturally increase industry and improvement; and the demand for the + precious metals, as well as for every other luxury and ornament, would + naturally increase with the increase of riches. A greater annual produce + would require a greater quantity of coin to circulate it; and a greater + number of rich people would require a greater quantity of plate and other + ornaments of silver. It is natural to suppose, too, that the greater part + of the mines which then supplied the European market with silver might be + a good deal exhausted, and have become more expensive in the working. They + had been wrought, many of them, from the time of the Romans. + + It has been the opinion, however, of the greater part of those who have + written upon the prices of commodities in ancient times, that, from the + Conquest, perhaps from the invasion of Julius Caesar, till the discovery + of the mines of America, the value of silver was continually diminishing. + This opinion they seem to have been led into, partly by the observations + which they had occasion to make upon the prices both of corn and of some + other parts of the rude produce of land, and partly by the popular notion, + that as the quantity of silver naturally increases in every country with + the increase of wealth, so its value diminishes as it quantity increases. + + In their observations upon the prices of corn, three different + circumstances seem frequently to have misled them. + + First, in ancient times, almost all rents were paid in kind; in a certain + quantity of corn, cattle, poultry, etc. It sometimes happened, however, + that the landlord would stipulate, that he should be at liberty to demand + of the tenant, either the annual payment in kind or a certain sum of money + instead of it. The price at which the payment in kind was in this manner + exchanged for a certain sum of money, is in Scotland called the conversion + price. As the option is always in the landlord to take either the + substance or the price, it is necessary, for the safety of the tenant, + that the conversion price should rather be below than above the average + market price. In many places, accordingly, it is not much above one half + of this price. Through the greater part of Scotland this custom still + continues with regard to poultry, and in some places with regard to + cattle. It might probably have continued to take place, too, with regard + to corn, had not the institution of the public fiars put an end to it. + These are annual valuations, according to the judgment of an assize, of + the average price of all the different sorts of grain, and of all the + different qualities of each, according to the actual market price in every + different county. This institution rendered it sufficiently safe for the + tenant, and much more convenient for the landlord, to convert, as they + call it, the corn rent, rather at what should happen to be the price of + the fiars of each year, than at any certain fixed price. But the writers + who have collected the prices of corn in ancient times seem frequently to + have mistaken what is called in Scotland the conversion price for the + actual market price. Fleetwood acknowledges, upon one occasion, that he + had made this mistake. As he wrote his book, however, for a particular + purpose, he does not think proper to make this acknowledgment till after + transcribing this conversion price fifteen times. The price is eight + shillings the quarter of wheat. This sum in 1423, the year at which he + begins with it, contained the same quantity of silver as sixteen shillings + of our present money. But in 1562, the year at which he ends with it, it + contained no more than the same nominal sum does at present. + + Secondly, they have been misled by the slovenly manner in which some + ancient statutes of assize had been sometimes transcribed by lazy copiers, + and sometimes, perhaps, actually composed by the legislature. + + The ancient statutes of assize seem to have begun always with determining + what ought to be the price of bread and ale when the price of wheat and + barley were at the lowest; and to have proceeded gradually to determine + what it ought to be, according as the prices of those two sorts of grain + should gradually rise above this lowest price. But the transcribers of + those statutes seem frequently to have thought it sufficient to copy the + regulation as far as the three or four first and lowest prices; saving in + this manner their own labour, and judging, I suppose, that this was enough + to show what proportion ought to be observed in all higher prices. + + Thus, in the assize of bread and ale, of the 51st of Henry III. the price + of bread was regulated according to the different prices of wheat, from + one shilling to twenty shillings the quarter of the money of those times. + But in the manuscripts from which all the different editions of the + statutes, preceding that of Mr Ruffhead, were printed, the copiers had + never transcribed this regulation beyond the price of twelve shillings. + Several writers, therefore, being misled by this faulty transcription, + very naturally conclude that the middle price, or six shillings the + quarter, equal to about eighteen shillings of our present money, was the + ordinary or average price of wheat at that time. + + In the statute of Tumbrel and Pillory, enacted nearly about the same time, + the price of ale is regulated according to every sixpence rise in the + price of barley, from two shillings, to four shillings the quarter. That + four shillings, however, was not considered as the highest price to which + barley might frequently rise in those times, and that these prices were + only given as an example of the proportion which ought to be observed in + all other prices, whether higher or lower, we may infer from the last + words of the statute: “Et sic deinceps crescetur vel diminuetur per sex + denarios.” The expression is very slovenly, but the meaning is plain + enough, “that the price of ale is in this manner to be increased or + diminished according to every sixpence rise or fall in the price of + barley.” In the composition of this statute, the legislature itself seems + to have been as negligent as the copiers were in the transcription of the + other. + + In an ancient manuscript of the Regiam Majestatem, an old Scotch law book, + there is a statute of assize, in which the price of bread is regulated + according to all the different prices of wheat, from tenpence to three + shillings the Scotch boll, equal to about half an English quarter. Three + shillings Scotch, at the time when this assize is supposed to have been + enacted, were equal to about nine shillings sterling of our present money. + Mr Ruddiman seems {See his Preface to Anderson’s Diplomata Scotiae.} to + conclude from this, that three shillings was the highest price to which + wheat ever rose in those times, and that tenpence, a shilling, or at most + two shillings, were the ordinary prices. Upon consulting the manuscript, + however, it appears evidently, that all these prices are only set down as + examples of the proportion which ought to be observed between the + respective prices of wheat and bread. The last words of the statute are + “reliqua judicabis secundum praescripta, habendo respectum ad pretium + bladi.”—“You shall judge of the remaining cases, according to what + is above written, having respect to the price of corn.” + + Thirdly, they seem to have been misled too, by the very low price at which + wheat was sometimes sold in very ancient times; and to have imagined, that + as its lowest price was then much lower than in later times its ordinary + price must likewise have been much lower. They might have found, however, + that in those ancient times its highest price was fully as much above, as + its lowest price was below any thing that had ever been known in later + times. Thus, in 1270, Fleetwood gives us two prices of the quarter of + wheat. The one is four pounds sixteen shillings of the money of those + times, equal to fourteen pounds eight shillings of that of the present; + the other is six pounds eight shillings, equal to nineteen pounds four + shillings of our present money. No price can be found in the end of the + fifteenth, or beginning of the sixteenth century, which approaches to the + extravagance of these. The price of corn, though at all times liable to + variation varies most in those turbulent and disorderly societies, in + which the interruption of all commerce and communication hinders the + plenty of one part of the country from relieving the scarcity of another. + In the disorderly state of England under the Plantagenets, who governed it + from about the middle of the twelfth till towards the end of the fifteenth + century, one district might be in plenty, while another, at no great + distance, by having its crop destroyed, either by some accident of the + seasons, or by the incursion of some neighbouring baron, might be + suffering all the horrors of a famine; and yet if the lands of some + hostile lord were interposed between them, the one might not be able to + give the least assistance to the other. Under the vigorous administration + of the Tudors, who governed England during the latter part of the + fifteenth, and through the whole of the sixteenth century, no baron was + powerful enough to dare to disturb the public security. + + The reader will find at the end of this chapter all the prices of wheat + which have been collected by Fleetwood, from 1202 to 1597, both inclusive, + reduced to the money of the present times, and digested, according to the + order of time, into seven divisions of twelve years each. At the end of + each division, too, he will find the average price of the twelve years of + which it consists. In that long period of time, Fleetwood has been able to + collect the prices of no more than eighty years; so that four years are + wanting to make out the last twelve years. I have added, therefore, from + the accounts of Eton college, the prices of 1598, 1599, 1600, and 1601. It + is the only addition which I have made. The reader will see, that from the + beginning of the thirteenth till after the middle of the sixteenth + century, the average price of each twelve years grows gradually lower and + lower; and that towards the end of the sixteenth century it begins to rise + again. The prices, indeed, which Fleetwood has been able to collect, seem + to have been those chiefly which were remarkable for extraordinary + dearness or cheapness; and I do not pretend that any very certain + conclusion can be drawn from them. So far, however, as they prove any + thing at all, they confirm the account which I have been endeavouring to + give. Fleetwood himself, however, seems, with most other writers, to have + believed, that, during all this period, the value of silver, in + consequence of its increasing abundance, was continually diminishing. The + prices of corn, which he himself has collected, certainly do not agree + with this opinion. They agree perfectly with that of Mr Dupré de St Maur, + and with that which I have been endeavouring to explain. Bishop Fleetwood + and Mr Dupré de St Maur are the two authors who seem to have collected, + with the greatest diligence and fidelity, the prices of things in ancient + times. It is somewhat curious that, though their opinions are so very + different, their facts, so far as they relate to the price of corn at + least, should coincide so very exactly. + + It is not, however, so much from the low price of corn, as from that of + some other parts of the rude produce of land, that the most judicious + writers have inferred the great value of silver in those very ancient + times. Corn, it has been said, being a sort of manufacture, was, in those + rude ages, much dearer in proportion than the greater part of other + commodities; it is meant, I suppose, than the greater part of + unmanufactured commodities, such as cattle, poultry, game of all kinds, + etc. That in those times of poverty and barbarism these were + proportionably much cheaper than corn, is undoubtedly true. But this + cheapness was not the effect of the high value of silver, but of the low + value of those commodities. It was not because silver would in such times + purchase or represent a greater quantity of labour, but because such + commodities would purchase or represent a much smaller quantity than in + times of more opulence and improvement. Silver must certainly be cheaper + in Spanish America than in Europe; in the country where it is produced, + than in the country to which it is brought, at the expense of a long + carriage both by land and by sea, of a freight, and an insurance. + One-and-twenty pence halfpenny sterling, however, we are told by Ulloa, + was, not many years ago, at Buenos Ayres, the price of an ox chosen from a + herd of three or four hundred. Sixteen shillings sterling, we are told by + Mr Byron, was the price of a good horse in the capital of Chili. In a + country naturally fertile, but of which the far greater part is altogether + uncultivated, cattle, poultry, game of all kinds, etc. as they can be + acquired with a very small quantity of labour, so they will purchase or + command but a very small quantity. The low money price for which they may + be sold, is no proof that the real value of silver is there very high, but + that the real value of those commodities is very low. + + Labour, it must always be remembered, and not any particular commodity, or + set of commodities, is the real measure of the value both of silver and of + all other commodities. + + But in countries almost waste, or but thinly inhabited, cattle, poultry, + game of all kinds, etc. as they are the spontaneous productions of Nature, + so she frequently produces them in much greater quantities than the + consumption of the inhabitants requires. In such a state of things, the + supply commonly exceeds the demand. In different states of society, in + different states of improvement, therefore, such commodities will + represent, or be equivalent, to very different quantities of labour. + + In every state of society, in every stage of improvement, corn is the + production of human industry. But the average produce of every sort of + industry is always suited, more or less exactly, to the average + consumption; the average supply to the average demand. In every different + stage of improvement, besides, the raising of equal quantities of corn in + the same soil and climate, will, at an average, require nearly equal + quantities of labour; or, what comes to the same thing, the price of + nearly equal quantities; the continual increase of the productive powers + of labour, in an improved state of cultivation, being more or less + counterbalanced by the continual increasing price of cattle, the principal + instruments of agriculture. Upon all these accounts, therefore, we may + rest assured, that equal quantities of corn will, in every state of + society, in every stage of improvement, more nearly represent, or be + equivalent to, equal quantities of labour, than equal quantities of any + other part of the rude produce of land. Corn, accordingly, it has already + been observed, is, in all the different stages of wealth and improvement, + a more accurate measure of value than any other commodity or set of + commodities. In all those different stages, therefore, we can judge better + of the real value of silver, by comparing it with corn, than by comparing + it with any other commodity or set of commodities. + + Corn, besides, or whatever else is the common and favourite vegetable food + of the people, constitutes, in every civilized country, the principal part + of the subsistence of the labourer. In consequence of the extension of + agriculture, the land of every country produces a much greater quantity of + vegetable than of animal food, and the labourer everywhere lives chiefly + upon the wholesome food that is cheapest and most abundant. Butcher’s + meat, except in the most thriving countries, or where labour is most + highly rewarded, makes but an insignificant part of his subsistence; + poultry makes a still smaller part of it, and game no part of it. In + France, and even in Scotland, where labour is somewhat better rewarded + than in France, the labouring poor seldom eat butcher’s meat, except upon + holidays, and other extraordinary occasions. The money price of labour, + therefore, depends much more upon the average money price of corn, the + subsistence of the labourer, than upon that of butcher’s meat, or of any + other part of the rude produce of land. The real value of gold and silver, + therefore, the real quantity of labour which they can purchase or command, + depends much more upon the quantity of corn which they can purchase or + command, than upon that of butcher’s meat, or any other part of the rude + produce of land. + + Such slight observations, however, upon the prices either of corn or of + other commodities, would not probably have misled so many intelligent + authors, had they not been influenced at the same time by the popular + notion, that as the quantity of silver naturally increases in every + country with the increase of wealth, so its value diminishes as its + quantity increases. This notion, however, seems to be altogether + groundless. + + The quantity of the precious metals may increase in any country from two + different causes; either, first, from the increased abundance of the mines + which supply it; or, secondly, from the increased wealth of the people, + from the increased produce of their annual labour. The first of these + causes is no doubt necessarily connected with the diminution of the value + of the precious metals; but the second is not. + + When more abundant mines are discovered, a greater quantity of the + precious metals is brought to market; and the quantity of the necessaries + and conveniencies of life for which they must be exchanged being the same + as before, equal quantities of the metals must be exchanged for smaller + quantities of commodities. So far, therefore, as the increase of the + quantity of the precious metals in any country arises from the increased + abundance of the mines, it is necessarily connected with some diminution + of their value. + + When, on the contrary, the wealth of any country increases, when the + annual produce of its labour becomes gradually greater and greater, a + greater quantity of coin becomes necessary in order to circulate a greater + quantity of commodities: and the people, as they can afford it, as they + have more commodities to give for it, will naturally purchase a greater + and a greater quantity of plate. The quantity of their coin will increase + from necessity; the quantity of their plate from vanity and ostentation, + or from the same reason that the quantity of fine statues, pictures, and + of every other luxury and curiosity, is likely to increase among them. But + as statuaries and painters are not likely to be worse rewarded in times of + wealth and prosperity, than in times of poverty and depression, so gold + and silver are not likely to be worse paid for. + + The price of gold and silver, when the accidental discovery of more + abundant mines does not keep it down, as it naturally rises with the + wealth of every country, so, whatever be the state of the mines, it is at + all times naturally higher in a rich than in a poor country. Gold and + silver, like all other commodities, naturally seek the market where the + best price is given for them, and the best price is commonly given for + every thing in the country which can best afford it. Labour, it must be + remembered, is the ultimate price which is paid for every thing; and in + countries where labour is equally well rewarded, the money price of labour + will be in proportion to that of the subsistence of the labourer. But gold + and silver will naturally exchange for a greater quantity of subsistence + in a rich than in a poor country; in a country which abounds with + subsistence, than in one which is but indifferently supplied with it. If + the two countries are at a great distance, the difference may be very + great; because, though the metals naturally fly from the worse to the + better market, yet it may be difficult to transport them in such + quantities as to bring their price nearly to a level in both. If the + countries are near, the difference will be smaller, and may sometimes be + scarce perceptible; because in this case the transportation will be easy. + China is a much richer country than any part of Europe, and the difference + between the price of subsistence in China and in Europe is very great. + Rice in China is much cheaper than wheat is any where in Europe. England + is a much richer country than Scotland, but the difference between the + money price of corn in those two countries is much smaller, and is but + just perceptible. In proportion to the quantity or measure, Scotch corn + generally appears to be a good deal cheaper than English; but, in + proportion to its quality, it is certainly somewhat dearer. Scotland + receives almost every year very large supplies from England, and every + commodity must commonly be somewhat dearer in the country to which it is + brought than in that from which it comes. English corn, therefore, must be + dearer in Scotland than in England; and yet in proportion to its quality, + or to the quantity and goodness of the flour or meal which can be made + from it, it cannot commonly be sold higher there than the Scotch corn + which comes to market in competition with it. + + The difference between the money price of labour in China and in Europe, + is still greater than that between the money price of subsistence; because + the real recompence of labour is higher in Europe than in China, the + greater part of Europe being in an improving state, while China seems to + be standing still. The money price of labour is lower in Scotland than in + England, because the real recompence of labour is much lower: Scotland, + though advancing to greater wealth, advances much more slowly than + England. The frequency of emigration from Scotland, and the rarity of it + from England, sufficiently prove that the demand for labour is very + different in the two countries. The proportion between the real recompence + of labour in different countries, it must be remembered, is naturally + regulated, not by their actual wealth or poverty, but by their advancing, + stationary, or declining condition. + + Gold and silver, as they are naturally of the greatest value among the + richest, so they are naturally of the least value among the poorest + nations. Among savages, the poorest of all nations, they are scarce of any + value. + + In great towns, corn is always dearer than in remote parts of the country. + This, however, is the effect, not of the real cheapness of silver, but of + the real dearness of corn. It does not cost less labour to bring silver to + the great town than to the remote parts of the country; but it costs a + great deal more to bring corn. + + In some very rich and commercial countries, such as Holland and the + territory of Genoa, corn is dear for the same reason that it is dear in + great towns. They do not produce enough to maintain their inhabitants. + They are rich in the industry and skill of their artificers and + manufacturers, in every sort of machinery which can facilitate and abridge + labour; in shipping, and in all the other instruments and means of + carriage and commerce: but they are poor in corn, which, as it must be + brought to them from distant countries, must, by an addition to its price, + pay for the carriage from those countries. It does not cost less labour to + bring silver to Amsterdam than to Dantzic; but it costs a great deal more + to bring corn. The real cost of silver must be nearly the same in both + places; but that of corn must be very different. Diminish the real + opulence either of Holland or of the territory of Genoa, while the number + of their inhabitants remains the same; diminish their power of supplying + themselves from distant countries; and the price of corn, instead of + sinking with that diminution in the quantity of their silver, which must + necessarily accompany this declension, either as its cause or as its + effect, will rise to the price of a famine. When we are in want of + necessaries, we must part with all superfluities, of which the value, as + it rises in times of opulence and prosperity, so it sinks in times of + poverty and distress. It is otherwise with necessaries. Their real price, + the quantity of labour which they can purchase or command, rises in times + of poverty and distress, and sinks in times of opulence and prosperity, + which are always times of great abundance; for they could not otherwise be + times of opulence and prosperity. Corn is a necessary, silver is only a + superfluity. + + Whatever, therefore, may have been the increase in the quantity of the + precious metals, which, during the period between the middle of the + fourteenth and that of the sixteenth century, arose from the increase of + wealth and improvement, it could have no tendency to diminish their value, + either in Great Britain, or in my other part of Europe. If those who have + collected the prices of things in ancient times, therefore, had, during + this period, no reason to infer the diminution of the value of silver from + any observations which they had made upon the prices either of corn, or of + other commodities, they had still less reason to infer it from any + supposed increase of wealth and improvement. + + Second Period.—But how various soever may have been the opinions of + the learned concerning the progress of the value of silver during the + first period, they are unanimous concerning it during the second. + + From about 1570 to about 1640, during a period of about seventy years, the + variation in the proportion between the value of silver and that of corn + held a quite opposite course. Silver sunk in its real value, or would + exchange for a smaller quantity of labour than before; and corn rose in + its nominal price, and, instead of being commonly sold for about two + ounces of silver the quarter, or about ten shillings of our present money, + came to be sold for six and eight ounces of silver the quarter, or about + thirty and forty shillings of our present money. + + The discovery of the abundant mines of America seems to have been the sole + cause of this diminution in the value of silver, in proportion to that of + corn. It is accounted for, accordingly, in the same manner by every body; + and there never has been any dispute, either about the fact, or about the + cause of it. The greater part of Europe was, during this period, advancing + in industry and improvement, and the demand for silver must consequently + have been increasing; but the increase of the supply had, it seems, so far + exceeded that of the demand, that the value of that metal sunk + considerably. The discovery of the mines of America, it is to be observed, + does not seem to have had any very sensible effect upon the prices of + things in England till after 1570; though even the mines of Potosi had + been discovered more than twenty years before. + + From 1595 to 1620, both inclusive, the average price of the quarter of + nine bushels of the best wheat, at Windsor market, appears, from the + accounts of Eton college, to have been £ 2:1:6 ⁹⁄₁₃. From which sum, + neglecting the fraction, and deducting a ninth, or 4s. 7 ⅓d., the price + of the quarter of eight bushels comes out to have been £ 1:16:10 ⅔. And + from this sum, neglecting likewise the fraction, and deducting a ninth, or + 4s. 1 ⅑d., for the difference between the price of the best wheat and + that of the middle wheat, the price of the middle wheat comes out to have + been about £ 1:12:8 ⁸⁄₉, or about six ounces and one-third of an ounce of + silver. + + From 1621 to 1636, both inclusive, the average price of the same measure + of the best wheat, at the same market, appears, from the same accounts, to + have been £ 2:10s.; from which, making the like deductions as in the + foregoing case, the average price of the quarter of eight bushels of + middle wheat comes out to have been £ 1:19:6, or about seven ounces and + two-thirds of an ounce of silver. + + Third Period.—Between 1630 and 1640, or about 1636, the effect of + the discovery of the mines of America, in reducing the value of silver, + appears to have been completed, and the value of that metal seems never to + have sunk lower in proportion to that of corn than it was about that time. + It seems to have risen somewhat in the course of the present century, and + it had probably begun to do so, even some time before the end of the last. + + From 1637 to 1700, both inclusive, being the sixty-four last years of the + last century the average price of the quarter of nine bushels of the best + wheat, at Windsor market, appears, from the same accounts, to have been £ + 2:11:0 ⅓, which is only 1s. 0 ⅓d. dearer than it had been during the + sixteen years before. But, in the course of these sixty-four years, there + happened two events, which must have produced a much greater scarcity of + corn than what the course of the seasons would otherwise have occasioned, + and which, therefore, without supposing any further reduction in the + value of silver, will much more than account for this very small + enhancement of price. + + The first of these events was the civil war, which, by discouraging + tillage and interrupting commerce, must have raised the price of corn much + above what the course of the seasons would otherwise have occasioned. It + must have had this effect, more or less, at all the different markets in + the kingdom, but particularly at those in the neighbourhood of London, + which require to be supplied from the greatest distance. In 1648, + accordingly, the price of the best wheat, at Windsor market, appears, from + the same accounts, to have been £ 4:5s., and, in 1649, to have been £ 4, + the quarter of nine bushels. The excess of those two years above £ 2:10s. + (the average price of the sixteen years preceding 1637) is £ 3:5s., which, + divided among the sixty four last years of the last century, will alone + very nearly account for that small enhancement of price which seems to + have taken place in them. These, however, though the highest, are by no + means the only high prices which seem to have been occasioned by the civil + wars. + + The second event was the bounty upon the exportation of corn, granted in + 1688. The bounty, it has been thought by many people, by encouraging + tillage, may, in a long course of years, have occasioned a greater + abundance, and, consequently, a greater cheapness of corn in the home + market, than what would otherwise have taken place there. How far the + bounty could produce this effect at any time I shall examine hereafter: I + shall only observe at present, that between 1688 and 1700, it had not time + to produce any such effect. During this short period, its only effect must + have been, by encouraging the exportation of the surplus produce of every + year, and thereby hindering the abundance of one year from compensating + the scarcity of another, to raise the price in the home market. The + scarcity which prevailed in England, from 1693 to 1699, both inclusive, + though no doubt principally owing to the badness of the seasons, and, + therefore, extending through a considerable part of Europe, must have been + somewhat enhanced by the bounty. In 1699, accordingly, the further + exportation of corn was prohibited for nine months. + + There was a third event which occurred in the course of the same period, + and which, though it could not occasion any scarcity of corn, nor, + perhaps, any augmentation in the real quantity of silver which was usually + paid for it, must necessarily have occasioned some augmentation in the + nominal sum. This event was the great debasement of the silver coin, by + clipping and wearing. This evil had begun in the reign of Charles II. and + had gone on continually increasing till 1695; at which time, as we may + learn from Mr Lowndes, the current silver coin was, at an average, near + five-and-twenty per cent. below its standard value. But the nominal sum + which constitutes the market price of every commodity is necessarily + regulated, not so much by the quantity of silver, which, according to the + standard, ought to be contained in it, as by that which, it is found by + experience, actually is contained in it. This nominal sum, therefore, is + necessarily higher when the coin is much debased by clipping and wearing, + than when near to its standard value. + + In the course of the present century, the silver coin has not at any time + been more below its standard weight than it is at present. But though very + much defaced, its value has been kept up by that of the gold coin, for + which it is exchanged. For though, before the late recoinage, the gold + coin was a good deal defaced too, it was less so than the silver. In 1695, + on the contrary, the value of the silver coin was not kept up by the gold + coin; a guinea then commonly exchanging for thirty shillings of the worn + and clipt silver. Before the late recoinage of the gold, the price of + silver bullion was seldom higher than five shillings and sevenpence an + ounce, which is but fivepence above the mint price. But in 1695, the + common price of silver bullion was six shillings and fivepence an ounce, + {Lowndes’s Essay on the Silver Coin, 68.} which is fifteen pence above the + mint price. Even before the late recoinage of the gold, therefore, the + coin, gold and silver together, when compared with silver bullion, was not + supposed to be more than eight per cent. below its standard value, In + 1695, on the contrary, it had been supposed to be near five-and-twenty per + cent. below that value. But in the beginning of the present century, that + is, immediately after the great recoinage in King William’s time, the + greater part of the current silver coin must have been still nearer to its + standard weight than it is at present. In the course of the present + century, too, there has been no great public calamity, such as a civil + war, which could either discourage tillage, or interrupt the interior + commerce of the country. And though the bounty which has taken place + through the greater part of this century, must always raise the price of + corn somewhat higher than it otherwise would be in the actual state of + tillage; yet, as in the course of this century, the bounty has had full + time to produce all the good effects commonly imputed to it to encourage + tillage, and thereby to increase the quantity of corn in the home market, + it may, upon the principles of a system which I shall explain and examine + hereafter, be supposed to have done something to lower the price of that + commodity the one way, as well as to raise it the other. It is by many + people supposed to have done more. In the sixty-four years of the present + century, accordingly, the average price of the quarter of nine bushels of + the best wheat, at Windsor market, appears, by the accounts of Eton + college, to have been £ 2:0:6 ¹⁰⁄₃₂, which is about ten shillings and + sixpence, or more than five-and-twenty percent. cheaper than it had been + during the sixty-four last years of the last century; and about nine + shillings and sixpence cheaper than it had been during the sixteen years + preceding 1636, when the discovery of the abundant mines of America may be + supposed to have produced its full effect; and about one shilling cheaper + than it had been in the twenty-six years preceding 1620, before that + discovery can well be supposed to have produced its full effect. According + to this account, the average price of middle wheat, during these + sixty-four first years of the present century, comes out to have been + about thirty-two shillings the quarter of eight bushels. + + The value of silver, therefore, seems to have risen somewhat in proportion + to that of corn during the course of the present century, and it had + probably begun to do so even some time before the end of the last. + + In 1687, the price of the quarter of nine bushels of the best wheat, at + Windsor market, was £ 1:5:2, the lowest price at which it had ever been + from 1595. + + In 1688, Mr Gregory King, a man famous for his knowledge in matters of + this kind, estimated the average price of wheat, in years of moderate + plenty, to be to the grower 3s. 6d. the bushel, or eight-and-twenty + shillings the quarter. The grower’s price I understand to be the same with + what is sometimes called the contract price, or the price at which a + farmer contracts for a certain number of years to deliver a certain + quantity of corn to a dealer. As a contract of this kind saves the farmer + the expense and trouble of marketing, the contract price is generally + lower than what is supposed to be the average market price. Mr King had + judged eight-and-twenty shillings the quarter to be at that time the + ordinary contract price in years of moderate plenty. Before the scarcity + occasioned by the late extraordinary course of bad seasons, it was, I have + been assured, the ordinary contract price in all common years. + + In 1688 was granted the parliamentary bounty upon the exportation of corn. + The country gentlemen, who then composed a still greater proportion of the + legislature than they do at present, had felt that the money price of corn + was falling. The bounty was an expedient to raise it artificially to the + high price at which it had frequently been sold in the times of Charles I. + and II. It was to take place, therefore, till wheat was so high as + fortyeight shillings the quarter; that is, twenty shillings, or 5-7ths + dearer than Mr King had, in that very year, estimated the grower’s price + to be in times of moderate plenty. If his calculations deserve any part of + the reputation which they have obtained very universally, eight-and-forty + shillings the quarter was a price which, without some such expedient as + the bounty, could not at that time be expected, except in years of + extraordinary scarcity. But the government of King William was not then + fully settled. It was in no condition to refuse anything to the country + gentlemen, from whom it was, at that very time, soliciting the first + establishment of the annual land-tax. + + The value of silver, therefore, in proportion to that of corn, had + probably risen somewhat before the end of the last century; and it seems + to have continued to do so during the course of the greater part of the + present, though the necessary operation of the bounty must have hindered + that rise from being so sensible as it otherwise would have been in the + actual state of tillage. + + In plentiful years, the bounty, by occasioning an extraordinary + exportation, necessarily raises the price of corn above what it otherwise + would be in those years. To encourage tillage, by keeping up the price of + corn, even in the most plentiful years, was the avowed end of the + institution. + + In years of great scarcity, indeed, the bounty has generally been + suspended. It must, however, have had some effect upon the prices of many + of those years. By the extraordinary exportation which it occasions in + years of plenty, it must frequently hinder the plenty of one year from + compensating the scarcity of another. + + Both in years of plenty and in years of scarcity, therefore, the bounty + raises the price of corn above what it naturally would be in the actual + state of tillage. If during the sixty-four first years of the present + century, therefore, the average price has been lower than during the + sixty-four last years of the last century, it must, in the same state of + tillage, have been much more so, had it not been for this operation of the + bounty. + + But, without the bounty, it may be said the state of tillage would not + have been the same. What may have been the effects of this institution + upon the agriculture of the country, I shall endeavour to explain + hereafter, when I come to treat particularly of bounties. I shall only + observe at present, that this rise in the value of silver, in proportion + to that of corn, has not been peculiar to England. It has been observed to + have taken place in France during the same period, and nearly in the same + proportion, too, by three very faithful, diligent, and laborious + collectors of the prices of corn, Mr Dupré de St Maur, Mr Messance, and + the author of the Essay on the Police of Grain. But in France, till 1764, + the exportation of grain was by law prohibited; and it is somewhat + difficult to suppose, that nearly the same diminution of price which took + place in one country, notwithstanding this prohibition, should, in + another, be owing to the extraordinary encouragement given to exportation. + + It would be more proper, perhaps, to consider this variation in the + average money price of corn as the effect rather of some gradual rise in + the real value of silver in the European market, than of any fall in the + real average value of corn. Corn, it has already been observed, is, at + distant periods of time, a more accurate measure of value than either + silver or, perhaps, any other commodity. When, after the discovery of the + abundant mines of America, corn rose to three and four times its former + money price, this change was universally ascribed, not to any rise in the + real value of corn, but to a fall in the real value of silver. If, during + the sixty-four first years of the present century, therefore, the average + money price of corn has fallen somewhat below what it had been during the + greater part of the last century, we should, in the same manner, impute + this change, not to any fall in the real value of corn, but to some rise + in the real value of silver in the European market. + + The high price of corn during these ten or twelve years past, indeed, has + occasioned a suspicion that the real value of silver still continues to + fall in the European market. This high price of corn, however, seems + evidently to have been the effect of the extraordinary unfavourableness of + the seasons, and ought, therefore, to be regarded, not as a permanent, but + as a transitory and occasional event. The seasons, for these ten or twelve + years past, have been unfavourable through the greater part of Europe; and + the disorders of Poland have very much increased the scarcity in all those + countries, which, in dear years, used to be supplied from that market. So + long a course of bad seasons, though not a very common event, is by no + means a singular one; and whoever has inquired much into the history of + the prices of corn in former times, will be at no loss to recollect + several other examples of the same kind. Ten years of extraordinary + scarcity, besides, are not more wonderful than ten years of extraordinary + plenty. The low price of corn, from 1741 to 1750, both inclusive, may very + well be set in opposition to its high price during these last eight or ten + years. From 1741 to 1750, the average price of the quarter of nine bushels + of the best wheat, at Windsor market, it appears from the accounts of Eton + college, was only £ 1:13:9 ⅘, which is nearly 6s.3d. below the average + price of the sixty-four first years of the present century. The average + price of the quarter of eight bushels of middle wheat comes out, according + to this account, to have been, during these ten years, only £ 1:6:8. + + Between 1741 and 1750, however, the bounty must have hindered the price of + corn from falling so low in the home market as it naturally would have + done. During these ten years, the quantity of all sorts of grain exported, + it appears from the custom-house books, amounted to no less than 8,029,156 + quarters, one bushel. The bounty paid for this amounted to £ + 1,514,962:17:4 ½. In 1749, accordingly, Mr Pelham, at that time prime + minister, observed to the house of commons, that, for the three years + preceding, a very extraordinary sum had been paid as bounty for the + exportation of corn. He had good reason to make this observation, and in + the following year he might have had still better. In that single year, + the bounty paid amounted to no less than £ 324,176:10:6. {See Tracts on + the Corn Trade, Tract 3,} It is unnecessary to observe how much this + forced exportation must have raised the price of corn above what it + otherwise would have been in the home market. + + At the end of the accounts annexed to this chapter the reader will find + the particular account of those ten years separated from the rest. He will + find there, too, the particular account of the preceding ten years, of + which the average is likewise below, though not so much below, the general + average of the sixty-four first years of the century. The year 1740, + however, was a year of extraordinary scarcity. These twenty years + preceding 1750 may very well be set in opposition to the twenty preceding + 1770. As the former were a good deal below the general average of the + century, notwithstanding the intervention of one or two dear years; so the + latter have been a good deal above it, notwithstanding the intervention of + one or two cheap ones, of 1759, for example. If the former have not been + as much below the general average as the latter have been above it, we + ought probably to impute it to the bounty. The change has evidently been + too sudden to be ascribed to any change in the value of silver, which is + always slow and gradual. The suddenness of the effect can be accounted for + only by a cause which can operate suddenly, the accidental variations of + the seasons. + + The money price of labour in Great Britain has, indeed, risen during the + course of the present century. This, however, seems to be the effect, not + so much of any diminution in the value of silver in the European market, + as of an increase in the demand for labour in Great Britain, arising from + the great, and almost universal prosperity of the country. In France, a + country not altogether so prosperous, the money price of labour has, since + the middle of the last century, been observed to sink gradually with the + average money price of corn. Both in the last century and in the present, + the day wages of common labour are there said to have been pretty + uniformly about the twentieth part of the average price of the septier of + wheat; a measure which contains a little more than four Winchester + bushels. In Great Britain, the real recompence of labour, it has already + been shewn, the real quantities of the necessaries and conveniencies of + life which are given to the labourer, has increased considerably during + the course of the present century. The rise in its money price seems to + have been the effect, not of any diminution of the value of silver in the + general market of Europe, but of a rise in the real price of labour, in + the particular market of Great Britain, owing to the peculiarly happy + circumstances of the country. + + For some time after the first discovery of America, silver would continue + to sell at its former, or not much below its former price. The profits of + mining would for some time be very great, and much above their natural + rate. Those who imported that metal into Europe, however, would soon find + that the whole annual importation could not be disposed of at this high + price. Silver would gradually exchange for a smaller and a smaller + quantity of goods. Its price would sink gradually lower and lower, till it + fell to its natural price; or to what was just sufficient to pay, + according to their natural rates, the wages of the labour, the profits of + the stock, and the rent of the land, which must be paid in order to bring + it from the mine to the market. In the greater part of the silver mines of + Peru, the tax of the king of Spain, amounting to a tenth of the gross + produce, eats up, it has already been observed, the whole rent of the + land. This tax was originally a half; it soon afterwards fell to a third, + then to a fifth, and at last to a tenth, at which late it still continues. + In the greater part of the silver mines of Peru, this, it seems, is all + that remains, after replacing the stock of the undertaker of the work, + together with its ordinary profits; and it seems to be universally + acknowledged that these profits, which were once very high, are now as low + as they can well be, consistently with carrying on the works. + + The tax of the king of Spain was reduced to a fifth of the registered + silver in 1504 {Solorzano, vol, ii.}, one-and-forty years before 1545, the + date of the discovery of the mines of Potosi. In the course of ninety + years, or before 1636, these mines, the most fertile in all America, had + time sufficient to produce their full effect, or to reduce the value of + silver in the European market as low as it could well fall, while it + continued to pay this tax to the king of Spain. Ninety years is time + sufficient to reduce any commodity, of which there is no monopoly, to its + natural price, or to the lowest price at which, while it pays a particular + tax, it can continue to be sold for any considerable time together. + + The price of silver in the European market might, perhaps, have fallen + still lower, and it might have become necessary either to reduce the tax + upon it, not only to one-tenth, as in 1736, but to one twentieth, in the + same manner as that upon gold, or to give up working the greater part of + the American mines which are now wrought. The gradual increase of the + demand for silver, or the gradual enlargement of the market for the + produce of the silver mines of America, is probably the cause which has + prevented this from happening, and which has not only kept up the value of + silver in the European market, but has perhaps even raised it somewhat + higher than it was about the middle of the last century. + + Since the first discovery of America, the market for the produce of its + silver mines has been growing gradually more and more extensive. + + First, the market of Europe has become gradually more and more extensive. + Since the discovery of America, the greater part of Europe has been much + improved. England, Holland, France, and Germany; even Sweden, Denmark, and + Russia, have all advanced considerably, both in agriculture and in + manufactures. Italy seems not to have gone backwards. The fall of Italy + preceded the conquest of Peru. Since that time it seems rather to have + recovered a little. Spain and Portugal, indeed, are supposed to have gone + backwards. Portugal, however, is but a very small part of Europe, and the + declension of Spain is not, perhaps, so great as is commonly imagined. In + the beginning of the sixteenth century, Spain was a very poor country, + even in comparison with France, which has been so much improved since that + time. It was the well known remark of the emperor Charles V. who had + travelled so frequently through both countries, that every thing abounded + in France, but that every thing was wanting in Spain. The increasing + produce of the agriculture and manufactures of Europe must necessarily + have required a gradual increase in the quantity of silver coin to + circulate it; and the increasing number of wealthy individuals must have + required the like increase in the quantity of their plate and other + ornaments of silver. + + Secondly, America is itself a new market, for the produce of its own + silver mines; and as its advances in agriculture, industry, and + population, are much more rapid than those of the most thriving countries + in Europe, its demand must increase much more rapidly. The English + colonies are altogether a new market, which, partly for coin, and partly + for plate, requires a continual augmenting supply of silver through a + great continent where there never was any demand before. The greater part, + too, of the Spanish and Portuguese colonies, are altogether new markets. + New Granada, the Yucatan, Paraguay, and the Brazils, were, before + discovered by the Europeans, inhabited by savage nations, who had neither + arts nor agriculture. A considerable degree of both has now been + introduced into all of them. Even Mexico and Peru, though they cannot be + considered as altogether new markets, are certainly much more extensive + ones than they ever were before. After all the wonderful tales which have + been published concerning the splendid state of those countries in ancient + times, whoever reads, with any degree of sober judgment, the history of + their first discovery and conquest, will evidently discern that, in arts, + agriculture, and commerce, their inhabitants were much more ignorant than + the Tartars of the Ukraine are at present. Even the Peruvians, the more + civilized nation of the two, though they made use of gold and silver as + ornaments, had no coined money of any kind. Their whole commerce was + carried on by barter, and there was accordingly scarce any division of + labour among them. Those who cultivated the ground, were obliged to build + their own houses, to make their own household furniture, their own + clothes, shoes, and instruments of agriculture. The few artificers among + them are said to have been all maintained by the sovereign, the nobles, + and the priests, and were probably their servants or slaves. All the + ancient arts of Mexico and Peru have never furnished one single + manufacture to Europe. The Spanish armies, though they scarce ever + exceeded five hundred men, and frequently did not amount to half that + number, found almost everywhere great difficulty in procuring subsistence. + The famines which they are said to have occasioned almost wherever they + went, in countries, too, which at the same time are represented as very + populous and well cultivated, sufficiently demonstrate that the story of + this populousness and high cultivation is in a great measure fabulous. The + Spanish colonies are under a government in many respects less favourable + to agriculture, improvement, and population, than that of the English + colonies. They seem, however, to be advancing in all those much more + rapidly than any country in Europe. In a fertile soil and happy climate, + the great abundance and cheapness of land, a circumstance common to all + new colonies, is, it seems, so great an advantage, as to compensate many + defects in civil government. Frezier, who visited Peru in 1713, represents + Lima as containing between twenty-five and twenty-eight thousand + inhabitants. Ulloa, who resided in the same country between 1740 and 1746, + represents it as containing more than fifty thousand. The difference in + their accounts of the populousness of several other principal towns of + Chili and Peru is nearly the same; and as there seems to be no reason to + doubt of the good information of either, it marks an increase which is + scarce inferior to that of the English colonies. America, therefore, is a + new market for the produce of its own silver mines, of which the demand + must increase much more rapidly than that of the most thriving country in + Europe. + + Thirdly, the East Indies is another market for the produce of the silver + mines of America, and a market which, from the time of the first discovery + of those mines, has been continually taking off a greater and a greater + quantity of silver. Since that time, the direct trade between America and + the East Indies, which is carried on by means of the Acapulco ships, has + been continually augmenting, and the indirect intercourse by the way of + Europe has been augmenting in a still greater proportion. During the + sixteenth century, the Portuguese were the only European nation who + carried on any regular trade to the East Indies. In the last years of that + century, the Dutch began to encroach upon this monopoly, and in a few + years expelled them from their principal settlements in India. During the + greater part of the last century, those two nations divided the most + considerable part of the East India trade between them; the trade of the + Dutch continually augmenting in a still greater proportion than that of + the Portuguese declined. The English and French carried on some trade with + India in the last century, but it has been greatly augmented in the course + of the present. The East India trade of the Swedes and Danes began in the + course of the present century. Even the Muscovites now trade regularly + with China, by a sort of caravans which go over land through Siberia and + Tartary to Pekin. The East India trade of all these nations, if we except + that of the French, which the last war had well nigh annihilated, has been + almost continually augmenting. The increasing consumptions of East India + goods in Europe is, it seems, so great, as to afford a gradual increase of + employment to them all. Tea, for example, was a drug very little used in + Europe, before the middle of the last century. At present, the value of + the tea annually imported by the English East India company, for the use + of their own countrymen, amounts to more than a million and a half a year; + and even this is not enough; a great deal more being constantly smuggled + into the country from the ports of Holland, from Gottenburgh in Sweden, + and from the coast of France, too, as long as the French East India + company was in prosperity. The consumption of the porcelain of China, of + the spiceries of the Moluccas, of the piece goods of Bengal, and of + innumerable other articles, has increased very nearly in a like + proportion. The tonnage, accordingly, of all the European shipping + employed in the East India trade, at any one time during the last century, + was not, perhaps, much greater than that of the English East India company + before the late reduction of their shipping. + + But in the East Indies, particularly in China and Indostan, the value of + the precious metals, when the Europeans first began to trade to those + countries, was much higher than in Europe; and it still continues to be + so. In rice countries, which generally yield two, sometimes three crops in + the year, each of them more plentiful than any common crop of corn, the + abundance of food must be much greater than in any corn country of equal + extent. Such countries are accordingly much more populous. In them, too, + the rich, having a greater superabundance of food to dispose of beyond + what they themselves can consume, have the means of purchasing a much + greater quantity of the labour of other people. The retinue of a grandee + in China or Indostan accordingly is, by all accounts, much more numerous + and splendid than that of the richest subjects in Europe. The same + superabundance of food, of which they have the disposal, enables them to + give a greater quantity of it for all those singular and rare productions + which nature furnishes but in very small quantities; such as the precious + metals and the precious stones, the great objects of the competition of + the rich. Though the mines, therefore, which supplied the Indian market, + had been as abundant as those which supplied the European, such + commodities would naturally exchange for a greater quantity of food in + India than in Europe. But the mines which supplied the Indian market with + the precious metals seem to have been a good deal less abundant, and those + which supplied it with the precious stones a good deal more so, than the + mines which supplied the European. The precious metals, therefore, would + naturally exchange in India for a somewhat greater quantity of the + precious stones, and for a much greater quantity of food than in Europe. + The money price of diamonds, the greatest of all superfluities, would be + somewhat lower, and that of food, the first of all necessaries, a great + deal lower in the one country than in the other. But the real price of + labour, the real quantity of the necessaries of life which is given to the + labourer, it has already been observed, is lower both in China and + Indostan, the two great markets of India, than it is through the greater + part of Europe. The wages of the labourer will there purchase a smaller + quantity of food: and as the money price of food is much lower in India + than in Europe, the money price of labour is there lower upon a double + account; upon account both of the small quantity of food which it will + purchase, and of the low price of that food. But in countries of equal art + and industry, the money price of the greater part of manufactures will be + in proportion to the money price of labour; and in manufacturing art and + industry, China and Indostan, though inferior, seem not to be much + inferior to any part of Europe. The money price of the greater part of + manufactures, therefore, will naturally be much lower in those great + empires than it is anywhere in Europe. Through the greater part of Europe, + too, the expense of land-carriage increases very much both the real and + nominal price of most manufactures. It costs more labour, and therefore + more money, to bring first the materials, and afterwards the complete + manufacture to market. In China and Indostan, the extent and variety of + inland navigations save the greater part of this labour, and consequently + of this money, and thereby reduce still lower both the real and the + nominal price of the greater part of their manufactures. Upon all these + accounts, the precious metals are a commodity which it always has been, + and still continues to be, extremely advantageous to carry from Europe to + India. There is scarce any commodity which brings a better price there; or + which, in proportion to the quantity of labour and commodities which it + costs in Europe, will purchase or command a greater quantity of labour and + commodities in India. It is more advantageous, too, to carry silver + thither than gold; because in China, and the greater part of the other + markets of India, the proportion between fine silver and fine gold is but + as ten, or at most as twelve to one; whereas in Europe it is as fourteen + or fifteen to one. In China, and the greater part of the other markets of + India, ten, or at most twelve ounces of silver, will purchase an ounce of + gold; in Europe, it requires from fourteen to fifteen ounces. In the + cargoes, therefore, of the greater part of European ships which sail to + India, silver has generally been one of the most valuable articles. It is + the most valuable article in the Acapulco ships which sail to Manilla. The + silver of the new continent seems, in this manner, to be one of the + principal commodities by which the commerce between the two extremities of + the old one is carried on; and it is by means of it, in a great measure, + that those distant parts of the world are connected with one another. + + In order to supply so very widely extended a market, the quantity of + silver annually brought from the mines must not only be sufficient to + support that continued increase, both of coin and of plate, which is + required in all thriving countries; but to repair that continual waste and + consumption of silver which takes place in all countries where that metal + is used. + + The continual consumption of the precious metals in coin by wearing, and + in plate both by wearing and cleaning, is very sensible; and in + commodities of which the use is so very widely extended, would alone + require a very great annual supply. The consumption of those metals in + some particular manufactures, though it may not perhaps be greater upon + the whole than this gradual consumption, is, however, much more sensible, + as it is much more rapid. In the manufactures of Birmingham alone, the + quantity of gold and silver annually employed in gilding and plating, and + thereby disqualified from ever afterwards appearing in the shape of those + metals, is said to amount to more than fifty thousand pounds sterling. We + may from thence form some notion how great must be the annual consumption + in all the different parts of the world, either in manufactures of the + same kind with those of Birmingham, or in laces, embroideries, gold and + silver stuffs, the gilding of books, furniture, etc. A considerable + quantity, too, must be annually lost in transporting those metals from one + place to another both by sea and by land. In the greater part of the + governments of Asia, besides, the almost universal custom of concealing + treasures in the bowels of the earth, of which the knowledge frequently + dies with the person who makes the concealment, must occasion the loss of + a still greater quantity. + + The quantity of gold and silver imported at both Cadiz and Lisbon + (including not only what comes under register, but what may be supposed to + be smuggled) amounts, according to the best accounts, to about six + millions sterling a-year. + + According to Mr Meggens {Postscript to the Universal Merchant p. 15 and + 16. This postscript was not printed till 1756, three years after the + publication of the book, which has never had a second edition. The + postscript is, therefore, to be found in few copies; it corrects several + errors in the book.}, the annual importation of the precious metals into + Spain, at an average of six years, viz. from 1748 to 1753, both inclusive, + and into Portugal, at an average of seven years, viz. from 1747 to 1753, + both inclusive, amounted in silver to 1,101,107 pounds weight, and in gold + to 49,940 pounds weight. The silver, at sixty two shillings the pound + troy, amounts to £ 3,413,431:10s. sterling. The gold, at forty-four + guineas and a half the pound troy, amounts to £ 2,333,446:14s. sterling. + Both together amount to £ 5,746,878:4s. sterling. The account of what was + imported under register, he assures us, is exact. He gives us the detail + of the particular places from which the gold and silver were brought, and + of the particular quantity of each metal, which, according to the + register, each of them afforded. He makes an allowance, too, for the + quantity of each metal which, he supposes, may have been smuggled. The + great experience of this judicious merchant renders his opinion of + considerable weight. + + According to the eloquent, and sometimes well-informed, author of the + Philosophical and Political History of the Establishment of the Europeans + in the two Indies, the annual importation of registered gold and silver + into Spain, at an average of eleven years, viz. from 1754 to 1764, both + inclusive, amounted to 13,984,185 ⅗ piastres of ten reals. On account of + what may have been smuggled, however, the whole annual importation, he + supposes, may have amounted to seventeen millions of piastres, which, at + 4s. 6d. the piastre, is equal to £ 3,825,000 sterling. He gives the + detail, too, of the particular places from which the gold and silver were + brought, and of the particular quantities of each metal, which according + to the register, each of them afforded. He informs us, too, that if we + were to judge of the quantity of gold annually imported from the Brazils + to Lisbon, by the amount of the tax paid to the king of Portugal, which it + seems, is one-fifth of the standard metal, we might value it at eighteen + millions of cruzadoes, or forty-five millions of French livres, equal to + about twenty millions sterling. On account of what may have been smuggled, + however, we may safely, he says, add to this sum an eighth more, or £ + 250,000 sterling, so that the whole will amount to £ 2,250,000 sterling. + According to this account, therefore, the whole annual importation of the + precious metals into both Spain and Portugal, mounts to about £ 6,075,000 + sterling. + + Several other very well authenticated, though manuscript accounts, I have + been assured, agree in making this whole annual importation amount, at an + average, to about six millions sterling; sometimes a little more, + sometimes a little less. + + The annual importation of the precious metals into Cadiz and Lisbon, + indeed, is not equal to the whole annual produce of the mines of America. + Some part is sent annually by the Acapulco ships to Manilla; some part is + employed in a contraband trade, which the Spanish colonies carry on with + those of other European nations; and some part, no doubt, remains in the + country. The mines of America, besides, are by no means the only gold and + silver mines in the world. They, are, however, by far the most abundant. + The produce of all the other mines which are known is insignificant, it is + acknowledged, in comparison with theirs; and the far greater part of + their produce, it is likewise acknowledged, is annually imported into + Cadiz and Lisbon. But the consumption of Birmingham alone, at the rate of + fifty thousand pounds a-year, is equal to the hundred-and-twentieth part + of this annual importation, at the rate of six millions a-year. The whole + annual consumption of gold and silver, therefore, in all the different + countries of the world where those metals are used, may, perhaps, be + nearly equal to the whole annual produce. The remainder may be no more + than sufficient to supply the increasing demand of all thriving countries. + It may even have fallen so far short of this demand, as somewhat to raise + the price of those metals in the European market. + + The quantity of brass and iron annually brought from the mine to the + market, is out of all proportion greater than that of gold and silver. We + do not, however, upon this account, imagine that those coarse metals are + likely to multiply beyond the demand, or to become gradually cheaper and + cheaper. Why should we imagine that the precious metals are likely to do + so? The coarse metals, indeed, though harder, are put to much harder uses, + and, as they are of less value, less care is employed in their + preservation. The precious metals, however, are not necessarily immortal + any more than they, but are liable, too, to be lost, wasted, and consumed, + in a great variety of ways. + + The price of all metals, though liable to slow and gradual variations, + varies less from year to year than that of almost any other part of the + rude produce of land: and the price of the precious metals is even less + liable to sudden variations than that of the coarse ones. The durableness + of metals is the foundation of this extraordinary steadiness of price. The + corn which was brought to market last year will be all, or almost all, + consumed, long before the end of this year. But some part of the iron + which was brought from the mine two or three hundred years ago, may be + still in use, and, perhaps, some part of the gold which was brought from + it two or three thousand years ago. The different masses of corn, which, + in different years, must supply the consumption of the world, will always + be nearly in proportion to the respective produce of those different + years. But the proportion between the different masses of iron which may + be in use in two different years, will be very little affected by any + accidental difference in the produce of the iron mines of those two years; + and the proportion between the masses of gold will be still less affected + by any such difference in the produce of the gold mines. Though the + produce of the greater part of metallic mines, therefore, varies, perhaps, + still more from year to year than that of the greater part of corn fields, + those variations have not the same effect upon the price of the one + species of commodities as upon that of the other. + + _Variations in the Proportion between the respective Values of Gold and + Silver._ + + + + + Before the discovery of the mines of America, the value of fine gold to + fine silver was regulated in the different mines of Europe, between the + proportions of one to ten and one to twelve; that is, an ounce of fine + gold was supposed to be worth from ten to twelve ounces of fine silver. + About the middle of the last century, it came to be regulated, between the + proportions of one to fourteen and one to fifteen; that is, an ounce of + fine gold came to be supposed worth between fourteen and fifteen ounces of + fine silver. Gold rose in its nominal value, or in the quantity of silver + which was given for it. Both metals sunk in their real value, or in the + quantity of labour which they could purchase; but silver sunk more than + gold. Though both the gold and silver mines of America exceeded in + fertility all those which had ever been known before, the fertility of the + silver mines had, it seems, been proportionally still greater than that of + the gold ones. + + The great quantities of silver carried annually from Europe to India, + have, in some of the English settlements, gradually reduced the value of + that metal in proportion to gold. In the mint of Calcutta, an ounce of + fine gold is supposed to be worth fifteen ounces of fine silver, in the + same manner as in Europe. It is in the mint, perhaps, rated too high for + the value which it bears in the market of Bengal. In China, the proportion + of gold to silver still continues as one to ten, or one to twelve. In + Japan, it is said to be as one to eight. + + The proportion between the quantities of gold and silver annually imported + into Europe, according to Mr Meggens’ account, is as one to twenty-two + nearly; that is, for one ounce of gold there are imported a little more + than twenty-two ounces of silver. The great quantity of silver sent + annually to the East Indies reduces, he supposes, the quantities of those + metals which remain in Europe to the proportion of one to fourteen or + fifteen, the proportion of their values. The proportion between their + values, he seems to think, must necessarily be the same as that between + their quantities, and would therefore be as one to twenty-two, were it not + for this greater exportation of silver. + + But the ordinary proportion between the respective values of two + commodities is not necessarily the same as that between the quantities of + them which are commonly in the market. The price of an ox, reckoned at ten + guineas, is about three score times the price of a lamb, reckoned at 3s. + 6d. It would be absurd, however, to infer from thence, that there are + commonly in the market three score lambs for one ox; and it would be just + as absurd to infer, because an ounce of gold will commonly purchase from + fourteen or fifteen ounces of silver, that there are commonly in the + market only fourteen or fifteen ounces of silver for one ounce of gold. + + The quantity of silver commonly in the market, it is probable, is much + greater in proportion to that of gold, than the value of a certain + quantity of gold is to that of an equal quantity of silver. The whole + quantity of a cheap commodity brought to market is commonly not only + greater, but of greater value, than the whole quantity of a dear one. The + whole quantity of bread annually brought to market, is not only greater, + but of greater value, than the whole quantity of butcher’s meat; the whole + quantity of butcher’s meat, than the whole quantity of poultry; and the + whole quantity of poultry, than the whole quantity of wild fowl. There are + so many more purchasers for the cheap than for the dear commodity, that, + not only a greater quantity of it, but a greater value can commonly be + disposed of. The whole quantity, therefore, of the cheap commodity, must + commonly be greater in proportion to the whole quantity of the dear one, + than the value of a certain quantity of the dear one, is to the value of + an equal quantity of the cheap one. When we compare the precious metals + with one another, silver is a cheap, and gold a dear commodity. We ought + naturally to expect, therefore, that there should always be in the market, + not only a greater quantity, but a greater value of silver than of gold. + Let any man, who has a little of both, compare his own silver with his + gold plate, and he will probably find, that not only the quantity, but the + value of the former, greatly exceeds that of the latter. Many people, + besides, have a good deal of silver who have no gold plate, which, even + with those who have it, is generally confined to watch-cases, snuff-boxes, + and such like trinkets, of which the whole amount is seldom of great + value. In the British coin, indeed, the value of the gold preponderates + greatly, but it is not so in that of all countries. In the coin of some + countries, the value of the two metals is nearly equal. In the Scotch + coin, before the union with England, the gold preponderated very little, + though it did somewhat {See Ruddiman’s Preface to Anderson’s Diplomata, + etc. Scotiae.}, as it appears by the accounts of the mint. In the coin of + many countries the silver preponderates. In France, the largest sums are + commonly paid in that metal, and it is there difficult to get more gold + than what is necessary to carry about in your pocket. The superior value, + however, of the silver plate above that of the gold, which takes place in + all countries, will much more than compensate the preponderancy of the + gold coin above the silver, which takes place only in some countries. + + Though, in one sense of the word, silver always has been, and probably + always will be, much cheaper than gold; yet, in another sense, gold may + perhaps, in the present state of the Spanish market, be said to be + somewhat cheaper than silver. A commodity may be said to be dear or cheap + not only according to the absolute greatness or smallness of its usual + price, but according as that price is more or less above the lowest for + which it is possible to bring it to market for any considerable time + together. This lowest price is that which barely replaces, with a moderate + profit, the stock which must be employed in bringing the commodity + thither. It is the price which affords nothing to the landlord, of which + rent makes not any component part, but which resolves itself altogether + into wages and profit. But, in the present state of the Spanish market, + gold is certainly somewhat nearer to this lowest price than silver. The + tax of the king of Spain upon gold is only one-twentieth part of the + standard metal, or five per cent.; whereas his tax upon silver amounts to + one-tenth part of it, or to ten per cent. In these taxes, too, it has + already been observed, consists the whole rent of the greater part of the + gold and silver mines of Spanish America; and that upon gold is still + worse paid than that upon silver. The profits of the undertakers of gold + mines, too, as they more rarely make a fortune, must, in general, be still + more moderate than those of the undertakers of silver mines. The price of + Spanish gold, therefore, as it affords both less rent and less profit, + must, in the Spanish market, be somewhat nearer to the lowest price for + which it is possible to bring it thither, than the price of Spanish + silver. When all expenses are computed, the whole quantity of the one + metal, it would seem, cannot, in the Spanish market, be disposed of so + advantageously as the whole quantity of the other. The tax, indeed, of the + king of Portugal upon the gold of the Brazils, is the same with the + ancient tax of the king of Spain upon the silver of Mexico and Peru; or + one-fifth part of the standard metal. It may therefore be uncertain, + whether, to the general market of Europe, the whole mass of American gold + comes at a price nearer to the lowest for which it is possible to bring it + thither, than the whole mass of American silver. + + The price of diamonds and other precious stones may, perhaps, be still + nearer to the lowest price at which it is possible to bring them to + market, than even the price of gold. + + Though it is not very probable that any part of a tax, which is not only + imposed upon one of the most proper subjects of taxation, a mere luxury + and superfluity, but which affords so very important a revenue as the tax + upon silver, will ever be given up as long as it is possible to pay it; + yet the same impossibility of paying it, which, in 1736. made it necessary + to reduce it from one-fifth to one-tenth, may in time make it necessary to + reduce it still further; in the same manner as it made it necessary to + reduce the tax upon gold to one-twentieth. That the silver mines of + Spanish America, like all other mines, become gradually more expensive in + the working, on account of the greater depths at which it is necessary to + carry on the works, and of the greater expense of drawing out the water, + and of supplying them with fresh air at those depths, is acknowledged by + everybody who has inquired into the state of those mines. + + These causes, which are equivalent to a growing scarcity of silver (for a + commodity may be said to grow scarcer when it becomes more difficult and + expensive to collect a certain quantity of it), must, in time, produce one + or other of the three following events: The increase of the expense must + either, first, be compensated altogether by a proportionable increase in + the price of the metal; or, secondly, it must be compensated altogether by + a proportionable diminution of the tax upon silver; or, thirdly, it must + be compensated partly by the one and partly by the other of those two + expedients. This third event is very possible. As gold rose in its price + in proportion to silver, notwithstanding a great diminution of the tax + upon gold, so silver might rise in its price in proportion to labour and + commodities, notwithstanding an equal diminution of the tax upon silver. + + Such successive reductions of the tax, however, though they may not + prevent altogether, must certainly retard, more or less, the rise of the + value of silver in the European market. In consequence of such reductions, + many mines may be wrought which could not be wrought before, because they + could not afford to pay the old tax; and the quantity of silver annually + brought to market, must always be somewhat greater, and, therefore, the + value of any given quantity somewhat less, than it otherwise would have + been. In consequence of the reduction in 1736, the value of silver in the + European market, though it may not at this day be lower than before that + reduction, is, probably, at least ten per cent. lower than it would have + been, had the court of Spain continued to exact the old tax. That, + notwithstanding this reduction, the value of silver has, during the course + of the present century, begun to rise somewhat in the European market, the + facts and arguments which have been alleged above, dispose me to believe, + or more properly to suspect and conjecture; for the best opinion which I + can form upon this subject, scarce, perhaps, deserves the name of belief. + The rise, indeed, supposing there has been any, has hitherto been so very + small, that after all that has been said, it may, perhaps, appear to many + people uncertain, not only whether this event has actually taken place, + but whether the contrary may not have taken place, or whether the value of + silver may not still continue to fall in the European market. + + It must be observed, however, that whatever may be the supposed annual + importation of gold and silver, there must be a certain period at which + the annual consumption of those metals will be equal to that annual + importation. Their consumption must increase as their mass increases, or + rather in a much greater proportion. As their mass increases, their value + diminishes. They are more used, and less cared for, and their consumption + consequently increases in a greater proportion than their mass. After a + certain period, therefore, the annual consumption of those metals must, in + this manner, become equal to their annual importation, provided that + importation is not continually increasing; which, in the present times, is + not supposed to be the case. + + If, when the annual consumption has become equal to the annual + importation, the annual importation should gradually diminish, the annual + consumption may, for some time, exceed the annual importation. The mass of + those metals may gradually and insensibly diminish, and their value + gradually and insensibly rise, till the annual importation becoming again + stationary, the annual consumption will gradually and insensibly + accommodate itself to what that annual importation can maintain. + + + _Grounds of the suspicion that the Value of Silver still continues to + decrease._ + + + The increase of the wealth of Europe, and the popular notion, that as the + quantity of the precious metals naturally increases with the increase of + wealth, so their value diminishes as their quantity increases, may, + perhaps, dispose many people to believe that their value still continues + to fall in the European market; and the still gradually increasing price + of many parts of the rude produce of land may confirm them still farther + in this opinion. + + That that increase in the quantity of the precious metals, which arises in + any country from the increase of wealth, has no tendency to diminish their + value, I have endeavoured to shew already. Gold and silver naturally + resort to a rich country, for the same reason that all sorts of luxuries + and curiosities resort to it; not because they are cheaper there than in + poorer countries, but because they are dearer, or because a better price + is given for them. It is the superiority of price which attracts them; and + as soon as that superiority ceases, they necessarily cease to go thither. + + If you except corn, and such other vegetables as are raised altogether by + human industry, that all other sorts of rude produce, cattle, poultry, + game of all kinds, the useful fossils and minerals of the earth, etc. + naturally grow dearer, as the society advances in wealth and improvement, + I have endeavoured to shew already. Though such commodities, therefore, + come to exchange for a greater quantity of silver than before, it will not + from thence follow that silver has become really cheaper, or will purchase + less labour than before; but that such commodities have become really + dearer, or will purchase more labour than before. It is not their nominal + price only, but their real price, which rises in the progress of + improvement. The rise of their nominal price is the effect, not of any + degradation of the value of silver, but of the rise in their real price. + + + _Different Effects of the Progress of Improvement upon three different + sorts of rude Produce._ + + + These different sorts of rude produce may be divided into three classes. + The first comprehends those which it is scarce in the power of human + industry to multiply at all. The second, those which it can multiply in + proportion to the demand. The third, those in which the efficacy of + industry is either limited or uncertain. In the progress of wealth and + improvement, the real price of the first may rise to any degree of + extravagance, and seems not to be limited by any certain boundary. That of + the second, though it may rise greatly, has, however, a certain boundary, + beyond which it cannot well pass for any considerable time together. That + of the third, though its natural tendency is to rise in the progress of + improvement, yet in the same degree of improvement it may sometimes happen + even to fall, sometimes to continue the same, and sometimes to rise more + or less, according as different accidents render the efforts of human + industry, in multiplying this sort of rude produce, more or less + successful. + + First Sort.—The first sort of rude produce, of which the price rises + in the progress of improvement, is that which it is scarce in the power of + human industry to multiply at all. It consists in those things which + nature produces only in certain quantities, and which being of a very + perishable nature, it is impossible to accumulate together the produce of + many different seasons. Such are the greater part of rare and singular + birds and fishes, many different sorts of game, almost all wild-fowl, all + birds of passage in particular, as well as many other things. When wealth, + and the luxury which accompanies it, increase, the demand for these is + likely to increase with them, and no effort of human industry may be able + to increase the supply much beyond what it was before this increase of the + demand. The quantity of such commodities, therefore, remaining the same, + or nearly the same, while the competition to purchase them is continually + increasing, their price may rise to any degree of extravagance, and seems + not to be limited by any certain boundary. If woodcocks should become so + fashionable as to sell for twenty guineas a-piece, no effort of human + industry could increase the number of those brought to market, much beyond + what it is at present. The high price paid by the Romans, in the time of + their greatest grandeur, for rare birds and fishes, may in this manner + easily be accounted for. These prices were not the effects of the low + value of silver in those times, but of the high value of such rarities and + curiosities as human industry could not multiply at pleasure. The real + value of silver was higher at Rome, for sometime before, and after the + fall of the republic, than it is through the greater part of Europe at + present. Three sestertii equal to about sixpence sterling, was the price + which the republic paid for the modius or peck of the tithe wheat of + Sicily. This price, however, was probably below the average market price, + the obligation to deliver their wheat at this rate being considered as a + tax upon the Sicilian farmers. When the Romans, therefore, had occasion to + order more corn than the tithe of wheat amounted to, they were bound by + capitulation to pay for the surplus at the rate of four sestertii, or + eightpence sterling the peck; and this had probably been reckoned the + moderate and reasonable, that is, the ordinary or average contract price + of those times; it is equal to about one-and-twenty shillings the quarter. + Eight-and-twenty shillings the quarter was, before the late years of + scarcity, the ordinary contract price of English wheat, which in quality + is inferior to the Sicilian, and generally sells for a lower price in the + European market. The value of silver, therefore, in those ancient times, + must have been to its value in the present, as three to four inversely; + that is, three ounces of silver would then have purchased the same + quantity of labour and commodities which four ounces will do at present. + When we read in Pliny, therefore, that Seius {Lib. X, c. 29.} bought a + white nightingale, as a present for the empress Agrippina, at the price of + six thousand sestertii, equal to about fifty pounds of our present money; + and that Asinius Celer {Lib. IX, c. 17.} purchased a surmullet at the + price of eight thousand sestertii, equal to about sixty-six pounds + thirteen shillings and fourpence of our present money; the extravagance of + those prices, how much soever it may surprise us, is apt, notwithstanding, + to appear to us about one third less than it really was. Their real price, + the quantity of labour and subsistence which was given away for them, was + about one-third more than their nominal price is apt to express to us in + the present times. Seius gave for the nightingale the command of a + quantity of labour and subsistence, equal to what £ 66:13: 4d. would + purchase in the present times; and Asinius Celer gave for a surmullet the + command of a quantity equal to what £ 88:17: 9d. would purchase. What + occasioned the extravagance of those high prices was, not so much the + abundance of silver, as the abundance of labour and subsistence, of which + those Romans had the disposal, beyond what was necessary for their own + use. The quantity of silver, of which they had the disposal, was a good + deal less than what the command of the same quantity of labour and + subsistence would have procured to them in the present times. + + Second sort.—The second sort of rude produce, of which the price + rises in the progress of improvement, is that which human industry can + multiply in proportion to the demand. It consists in those useful plants + and animals, which, in uncultivated countries, nature produces with such + profuse abundance, that they are of little or no value, and which, as + cultivation advances, are therefore forced to give place to some more + profitable produce. During a long period in the progress of improvement, + the quantity of these is continually diminishing, while, at the same time, + the demand for them is continually increasing. Their real value, + therefore, the real quantity of labour which they will purchase or + command, gradually rises, till at last it gets so high as to render them + as profitable a produce as any thing else which human industry can raise + upon the most fertile and best cultivated land. When it has got so high, + it cannot well go higher. If it did, more land and more industry would + soon be employed to increase their quantity. + + When the price of cattle, for example, rises so high, that it is as + profitable to cultivate land in order to raise food for them as in order + to raise food for man, it cannot well go higher. If it did, more corn land + would soon be turned into pasture. The extension of tillage, by + diminishing the quantity of wild pasture, diminishes the quantity of + butcher’s meat, which the country naturally produces without labour or + cultivation; and, by increasing the number of those who have either corn, + or, what comes to the same thing, the price of corn, to give in exchange + for it, increases the demand. The price of butcher’s meat, therefore, and, + consequently, of cattle, must gradually rise, till it gets so high, that + it becomes as profitable to employ the most fertile and best cultivated + lands in raising food for them as in raising corn. But it must always be + late in the progress of improvement before tillage can be so far extended + as to raise the price of cattle to this height; and, till it has got to + this height, if the country is advancing at all, their price must be + continually rising. There are, perhaps, some parts of Europe in which the + price of cattle has not yet got to this height. It had not got to this + height in any part of Scotland before the Union. Had the Scotch cattle + been always confined to the market of Scotland, in a country in which the + quantity of land, which can be applied to no other purpose but the feeding + of cattle, is so great in proportion to what can be applied to other + purposes, it is scarce possible, perhaps, that their price could ever have + risen so high as to render it profitable to cultivate land for the sake of + feeding them. In England, the price of cattle, it has already been + observed, seems, in the neighbourhood of London, to have got to this + height about the beginning of the last century; but it was much later, + probably, before it got through the greater part of the remoter counties, + in some of which, perhaps, it may scarce yet have got to it. Of all the + different substances, however, which compose this second sort of rude + produce, cattle is, perhaps, that of which the price, in the progress of + improvement, rises first to this height. + + Till the price of cattle, indeed, has got to this height, it seems scarce + possible that the greater part, even of those lands which are capable of + the highest cultivation, can be completely cultivated. In all farms too + distant from any town to carry manure from it, that is, in the far greater + part of those of every extensive country, the quantity of well cultivated + land must be in proportion to the quantity of manure which the farm itself + produces; and this, again, must be in proportion to the stock of cattle + which are maintained upon it. The land is manured, either by pasturing the + cattle upon it, or by feeding them in the stable, and from thence carrying + out their dung to it. But unless the price of the cattle be sufficient to + pay both the rent and profit of cultivated land, the farmer cannot afford + to pasture them upon it; and he can still less afford to feed them in the + stable. It is with the produce of improved and cultivated land only that + cattle can be fed in the stable; because, to collect the scanty and + scattered produce of waste and unimproved lands, would require too much + labour, and be too expensive. If the price of the cattle, therefore, is + not sufficient to pay for the produce of improved and cultivated land, + when they are allowed to pasture it, that price will be still less + sufficient to pay for that produce, when it must be collected with a good + deal of additional labour, and brought into the stable to them. In these + circumstances, therefore, no more cattle can with profit be fed in the + stable than what are necessary for tillage. But these can never afford + manure enough for keeping constantly in good condition all the lands which + they are capable of cultivating. What they afford, being insufficient for + the whole farm, will naturally be reserved for the lands to which it can + be most advantageously or conveniently applied; the most fertile, or + those, perhaps, in the neighbourhood of the farm-yard. These, therefore, + will be kept constantly in good condition, and fit for tillage. The rest + will, the greater part of them, be allowed to lie waste, producing scarce + any thing but some miserable pasture, just sufficient to keep alive a few + straggling, half-starved cattle; the farm, though much overstocked in + proportion to what would be necessary for its complete cultivation, being + very frequently overstocked in proportion to its actual produce. A portion + of this waste land, however, after having been pastured in this wretched + manner for six or seven years together, may be ploughed up, when it will + yield, perhaps, a poor crop or two of bad oats, or of some other coarse + grain; and then, being entirely exhausted, it must be rested and pastured + again as before, and another portion ploughed up, to be in the same manner + exhausted and rested again in its turn. Such, accordingly, was the general + system of management all over the low country of Scotland before the + Union. The lands which were kept constantly well manured and in good + condition seldom exceeded a third or fourth part of the whole farm, and + sometimes did not amount to a fifth or a sixth part of it. The rest were + never manured, but a certain portion of them was in its turn, + notwithstanding, regularly cultivated and exhausted. Under this system of + management, it is evident, even that part of the lands of Scotland which + is capable of good cultivation, could produce but little in comparison of + what it may be capable of producing. But how disadvantageous soever this + system may appear, yet, before the Union, the low price of cattle seems to + have rendered it almost unavoidable. If, notwithstanding a great rise in + the price, it still continues to prevail through a considerable part of + the country, it is owing in many places, no doubt, to ignorance and + attachment to old customs, but, in most places, to the unavoidable + obstructions which the natural course of things opposes to the immediate + or speedy establishment of a better system: first, to the poverty of the + tenants, to their not having yet had time to acquire a stock of cattle + sufficient to cultivate their lands more completely, the same rise of + price, which would render it advantageous for them to maintain a greater + stock, rendering it more difficult for them to acquire it; and, secondly, + to their not having yet had time to put their lands in condition to + maintain this greater stock properly, supposing they were capable of + acquiring it. The increase of stock and the improvement of land are two + events which must go hand in hand, and of which the one can nowhere much + outrun the other. Without some increase of stock, there can be scarce any + improvement of land, but there can be no considerable increase of stock, + but in consequence of a considerable improvement of land; because + otherwise the land could not maintain it. These natural obstructions to + the establishment of a better system, cannot be removed but by a long + course of frugality and industry; and half a century or a century more, + perhaps, must pass away before the old system, which is wearing out + gradually, can be completely abolished through all the different parts of + the country. Of all the commercial advantages, however, which Scotland has + derived from the Union with England, this rise in the price of cattle is, + perhaps, the greatest. It has not only raised the value of all highland + estates, but it has, perhaps, been the principal cause of the improvement + of the low country. + + In all new colonies, the great quantity of waste land, which can for many + years be applied to no other purpose but the feeding of cattle, soon + renders them extremely abundant; and in every thing great cheapness is the + necessary consequence of great abundance. Though all the cattle of the + European colonies in America were originally carried from Europe, they + soon multiplied so much there, and became of so little value, that even + horses were allowed to run wild in the woods, without any owner thinking + it worth while to claim them. It must be a long time after the first + establishment of such colonies, before it can become profitable to feed + cattle upon the produce of cultivated land. The same causes, therefore, + the want of manure, and the disproportion between the stock employed in + cultivation and the land which it is destined to cultivate, are likely to + introduce there a system of husbandry, not unlike that which still + continues to take place in so many parts of Scotland. Mr Kalm, the Swedish + traveller, when he gives an account of the husbandry of some of the + English colonies in North America, as he found it in 1749, observes, + accordingly, that he can with difficulty discover there the character of + the English nation, so well skilled in all the different branches of + agriculture. They make scarce any manure for their corn fields, he says; + but when one piece of ground has been exhausted by continual cropping, + they clear and cultivate another piece of fresh land; and when that is + exhausted, proceed to a third. Their cattle are allowed to wander through + the woods and other uncultivated grounds, where they are half-starved; + having long ago extirpated almost all the annual grasses, by cropping them + too early in the spring, before they had time to form their flowers, or to + shed their seeds. {Kalm’s Travels, vol 1, pp. 343, 344.} The annual + grasses were, it seems, the best natural grasses in that part of North + America; and when the Europeans first settled there, they used to grow + very thick, and to rise three or four feet high. A piece of ground which, + when he wrote, could not maintain one cow, would in former times, he was + assured, have maintained four, each of which would have given four times + the quantity of milk which that one was capable of giving. The poorness of + the pasture had, in his opinion, occasioned the degradation of their + cattle, which degenerated sensibly from one generation to another. They + were probably not unlike that stunted breed which was common all over + Scotland thirty or forty years ago, and which is now so much mended + through the greater part of the low country, not so much by a change of + the breed, though that expedient has been employed in some places, as by a + more plentiful method of feeding them. + + Though it is late, therefore, in the progress of improvement, before + cattle can bring such a price as to render it profitable to cultivate land + for the sake of feeding them; yet of all the different parts which compose + this second sort of rude produce, they are perhaps the first which bring + this price; because, till they bring it, it seems impossible that + improvement can be brought near even to that degree of perfection to which + it has arrived in many parts of Europe. + + As cattle are among the first, so perhaps venison is among the last parts + of this sort of rude produce which bring this price. The price of venison + in Great Britain, how extravagant soever it may appear, is not near + sufficient to compensate the expense of a deer park, as is well known to + all those who have had any experience in the feeding of deer. If it was + otherwise, the feeding of deer would soon become an article of common + farming, in the same manner as the feeding of those small birds, called + turdi, was among the ancient Romans. Varro and Columella assure us, that + it was a most profitable article. The fattening of ortolans, birds of + passage which arrive lean in the country, is said to be so in some parts + of France. If venison continues in fashion, and the wealth and luxury of + Great Britain increase as they have done for some time past, its price may + very probably rise still higher than it is at present. + + Between that period in the progress of improvement, which brings to its + height the price of so necessary an article as cattle, and that which + brings to it the price of such a superfluity as venison, there is a very + long interval, in the course of which many other sorts of rude produce + gradually arrive at their highest price, some sooner and some later, + according to different circumstances. + + Thus, in every farm, the offals of the barn and stable will maintain a + certain number of poultry. These, as they are fed with what would + otherwise be lost, are a mere save-all; and as they cost the farmer scarce + any thing, so he can afford to sell them for very little. Almost all that + he gets is pure gain, and their price can scarce be so low as to + discourage him from feeding this number. But in countries ill cultivated, + and therefore but thinly inhabited, the poultry, which are thus raised + without expense, are often fully sufficient to supply the whole demand. In + this state of things, therefore, they are often as cheap as butcher’s + meat, or any other sort of animal food. But the whole quantity of poultry + which the farm in this manner produces without expense, must always be + much smaller than the whole quantity of butcher’s meat which is reared + upon it; and in times of wealth and luxury, what is rare, with only nearly + equal merit, is always preferred to what is common. As wealth and luxury + increase, therefore, in consequence of improvement and cultivation, the + price of poultry gradually rises above that of butcher’s meat, till at + last it gets so high, that it becomes profitable to cultivate land for the + sake of feeding them. When it has got to this height, it cannot well go + higher. If it did, more land would soon be turned to this purpose. In + several provinces of France, the feeding of poultry is considered as a + very important article in rural economy, and sufficiently profitable to + encourage the farmer to raise a considerable quantity of Indian corn and + buckwheat for this purpose. A middling farmer will there sometimes have + four hundred fowls in his yard. The feeding of poultry seems scarce yet to + be generally considered as a matter of so much importance in England. They + are certainly, however, dearer in England than in France, as England + receives considerable supplies from France. In the progress of + improvements, the period at which every particular sort of animal food is + dearest, must naturally be that which immediately precedes the general + practice of cultivating land for the sake of raising it. For some time + before this practice becomes general, the scarcity must necessarily raise + the price. After it has become general, new methods of feeding are + commonly fallen upon, which enable the farmer to raise upon the same + quantity of ground a much greater quantity of that particular sort of + animal food. The plenty not only obliges him to sell cheaper, but, in + consequence of these improvements, he can afford to sell cheaper; for if + he could not afford it, the plenty would not be of long continuance. It + has been probably in this manner that the introduction of clover, turnips, + carrots, cabbages, etc. has contributed to sink the common price of + butcher’s meat in the London market, somewhat below what it was about the + beginning of the last century. + + The hog, that finds his food among ordure, and greedily devours many + things rejected by every other useful animal, is, like poultry, originally + kept as a save-all. As long as the number of such animals, which can thus + be reared at little or no expense, is fully sufficient to supply the + demand, this sort of butcher’s meat comes to market at a much lower price + than any other. But when the demand rises beyond what this quantity can + supply, when it becomes necessary to raise food on purpose for feeding and + fattening hogs, in the same manner as for feeding and fattening other + cattle, the price necessarily rises, and becomes proportionably either + higher or lower than that of other butcher’s meat, according as the nature + of the country, and the state of its agriculture, happen to render the + feeding of hogs more or less expensive than that of other cattle. In + France, according to Mr Buffon, the price of pork is nearly equal to that + of beef. In most parts of Great Britain it is at present somewhat higher. + + The great rise in the price both of hogs and poultry, has, in Great + Britain, been frequently imputed to the diminution of the number of + cottagers and other small occupiers of land; an event which has in every + part of Europe been the immediate forerunner of improvement and better + cultivation, but which at the same time may have contributed to raise the + price of those articles, both somewhat sooner and somewhat faster than it + would otherwise have risen. As the poorest family can often maintain a cat + or a dog without any expense, so the poorest occupiers of land can + commonly maintain a few poultry, or a sow and a few pigs, at very little. + The little offals of their own table, their whey, skimmed milk, and butter + milk, supply those animals with a part of their food, and they find the + rest in the neighbouring fields, without doing any sensible damage to any + body. By diminishing the number of those small occupiers, therefore, the + quantity of this sort of provisions, which is thus produced at little or + no expense, must certainly have been a good deal diminished, and their + price must consequently have been raised both sooner and faster than it + would otherwise have risen. Sooner or later, however, in the progress of + improvement, it must at any rate have risen to the utmost height to which + it is capable of rising; or to the price which pays the labour and expense + of cultivating the land which furnishes them with food, as well as these + are paid upon the greater part of other cultivated land. + + The business of the dairy, like the feeding of hogs and poultry, is + originally carried on as a save-all. The cattle necessarily kept upon the + farm produce more milk than either the rearing of their own young, or the + consumption of the farmer’s family requires; and they produce most at one + particular season. But of all the productions of land, milk is perhaps the + most perishable. In the warm season, when it is most abundant, it will + scarce keep four-and-twenty hours. The farmer, by making it into fresh + butter, stores a small part of it for a week; by making it into salt + butter, for a year; and by making it into cheese, he stores a much greater + part of it for several years. Part of all these is reserved for the use of + his own family; the rest goes to market, in order to find the best price + which is to be had, and which can scarce be so low is to discourage him + from sending thither whatever is over and above the use of his own family. + If it is very low indeed, he will be likely to manage his dairy in a very + slovenly and dirty manner, and will scarce, perhaps, think it worth while + to have a particular room or building on purpose for it, but will suffer + the business to be carried on amidst the smoke, filth, and nastiness of + his own kitchen, as was the case of almost all the farmers’ dairies in + Scotland thirty or forty years ago, and as is the case of many of them + still. The same causes which gradually raise the price of butcher’s meat, + the increase of the demand, and, in consequence of the improvement of the + country, the diminution of the quantity which can be fed at little or no + expense, raise, in the same manner, that of the produce of the dairy, of + which the price naturally connects with that of butcher’s meat, or with + the expense of feeding cattle. The increase of price pays for more labour, + care, and cleanliness. The dairy becomes more worthy of the farmer’s + attention, and the quality of its produce gradually improves. The price at + last gets so high, that it becomes worth while to employ some of the most + fertile and best cultivated lands in feeding cattle merely for the purpose + of the dairy; and when it has got to this height, it cannot well go + higher. If it did, more land would soon be turned to this purpose. It + seems to have got to this height through the greater part of England, + where much good land is commonly employed in this manner. If you except + the neighbourhood of a few considerable towns, it seems not yet to have + got to this height anywhere in Scotland, where common farmers seldom + employ much good land in raising food for cattle, merely for the purpose + of the dairy. The price of the produce, though it has risen very + considerably within these few years, is probably still too low to admit of + it. The inferiority of the quality, indeed, compared with that of the + produce of English dairies, is fully equal to that of the price. But this + inferiority of quality is, perhaps, rather the effect of this lowness of + price, than the cause of it. Though the quality was much better, the + greater part of what is brought to market could not, I apprehend, in the + present circumstances of the country, be disposed of at a much better + price; and the present price, it is probable, would not pay the expense of + the land and labour necessary for producing a much better quality. Through + the greater part of England, notwithstanding the superiority of price, the + dairy is not reckoned a more profitable employment of land than the + raising of corn, or the fattening of cattle, the two great objects of + agriculture. Through the greater part of Scotland, therefore, it cannot + yet be even so profitable. + + The lands of no country, it is evident, can ever be completely cultivated + and improved, till once the price of every produce, which human industry + is obliged to raise upon them, has got so high as to pay for the expense + of complete improvement and cultivation. In order to do this, the price of + each particular produce must be sufficient, first, to pay the rent of good + corn land, as it is that which regulates the rent of the greater part of + other cultivated land; and, secondly, to pay the labour and expense of the + farmer, as well as they are commonly paid upon good corn land; or, in + other words, to replace with the ordinary profits the stock which he + employs about it. This rise in the price of each particular produce; must + evidently be previous to the improvement and cultivation of the land which + is destined for raising it. Gain is the end of all improvement; and + nothing could deserve that name, of which loss was to be the necessary + consequence. But loss must be the necessary consequence of improving land + for the sake of a produce of which the price could never bring back the + expense. If the complete improvement and cultivation of the country be, as + it most certainly is, the greatest of all public advantages, this rise in + the price of all those different sorts of rude produce, instead of being + considered as a public calamity, ought to be regarded as the necessary + forerunner and attendant of the greatest of all public advantages. + + This rise, too, in the nominal or money price of all those different sorts + of rude produce, has been the effect, not of any degradation in the value + of silver, but of a rise in their real price. They have become worth, not + only a greater quantity of silver, but a greater quantity of labour and + subsistence than before. As it costs a greater quantity of labour and + subsistence to bring them to market, so, when they are brought thither + they represent, or are equivalent to a greater quantity. + + Third Sort.—The third and last sort of rude produce, of which the + price naturally rises in the progress of improvement, is that in which the + efficacy of human industry, in augmenting the quantity, is either limited + or uncertain. Though the real price of this sort of rude produce, + therefore, naturally tends to rise in the progress of improvement, yet, + according as different accidents happen to render the efforts of human + industry more or less successful in augmenting the quantity, it may happen + sometimes even to fall, sometimes to continue the same, in very different + periods of improvement, and sometimes to rise more or less in the same + period. + + There are some sorts of rude produce which nature has rendered a kind of + appendages to other sorts; so that the quantity of the one which any + country can afford, is necessarily limited by that of the other. The + quantity of wool or of raw hides, for example, which any country can + afford, is necessarily limited by the number of great and small cattle + that are kept in it. The state of its improvement, and the nature of its + agriculture, again necessarily determine this number. + + The same causes which, in the progress of improvement, gradually raise the + price of butcher’s meat, should have the same effect, it may be thought, + upon the prices of wool and raw hides, and raise them, too, nearly in the + same proportion. It probably would be so, if, in the rude beginnings of + improvement, the market for the latter commodities was confined within as + narrow bounds as that for the former. But the extent of their respective + markets is commonly extremely different. + + The market for butcher’s meat is almost everywhere confined to the country + which produces it. Ireland, and some part of British America, indeed, + carry on a considerable trade in salt provisions; but they are, I believe, + the only countries in the commercial world which do so, or which export to + other countries any considerable part of their butcher’s meat. + + The market for wool and raw hides, on the contrary, is, in the rude + beginnings of improvement, very seldom confined to the country which + produces them. They can easily be transported to distant countries; wool + without any preparation, and raw hides with very little; and as they are + the materials of many manufactures, the industry of other countries may + occasion a demand for them, though that of the country which produces them + might not occasion any. + + In countries ill cultivated, and therefore but thinly inhabited, the price + of the wool and the hide bears always a much greater proportion to that of + the whole beast, than in countries where, improvement and population being + further advanced, there is more demand for butcher’s meat. Mr Hume + observes, that in the Saxon times, the fleece was estimated at two-fifths + of the value of the whole sheep and that this was much above the + proportion of its present estimation. In some provinces of Spain, I have + been assured, the sheep is frequently killed merely for the sake of the + fleece and the tallow. The carcase is often left to rot upon the ground, + or to be devoured by beasts and birds of prey. If this sometimes happens + even in Spain, it happens almost constantly in Chili, at Buenos Ayres, and + in many other parts of Spanish America, where the horned cattle are almost + constantly killed merely for the sake of the hide and the tallow. This, + too, used to happen almost constantly in Hispaniola, while it was infested + by the buccaneers, and before the settlement, improvement, and + populousness of the French plantations ( which now extend round the coast + of almost the whole western half of the island) had given some value to + the cattle of the Spaniards, who still continue to possess, not only the + eastern part of the coast, but the whole inland mountainous part of the + country. + + Though, in the progress of improvement and population, the price of the + whole beast necessarily rises, yet the price of the carcase is likely to + be much more affected by this rise than that of the wool and the hide. The + market for the carcase being in the rude state of society confined always + to the country which produces it, must necessarily be extended in + proportion to the improvement and population of that country. But the + market for the wool and the hides, even of a barbarous country, often + extending to the whole commercial world, it can very seldom be enlarged in + the same proportion. The state of the whole commercial world can seldom be + much affected by the improvement of any particular country; and the market + for such commodities may remain the same, or very nearly the same, after + such improvements, as before. It should, however, in the natural course of + things, rather, upon the whole, be somewhat extended in consequence of + them. If the manufactures, especially, of which those commodities are the + materials, should ever come to flourish in the country, the market, though + it might not be much enlarged, would at least be brought much nearer to + the place of growth than before; and the price of those materials might at + least be increased by what had usually been the expense of transporting + them to distant countries. Though it might not rise, therefore, in the + same proportion as that of butcher’s meat, it ought naturally to rise + somewhat, and it ought certainly not to fall. + + In England, however, notwithstanding the flourishing state of its woollen + manufacture, the price of English wool has fallen very considerably since + the time of Edward III. There are many authentic records which demonstrate + that, during the reign of that prince (towards the middle of the + fourteenth century, or about 1339), what was reckoned the moderate and + reasonable price of the tod, or twenty-eight pounds of English wool, was + not less than ten shillings of the money of those times {See Smith’s + Memoirs of Wool, vol. i c. 5, 6, 7. also vol. ii.}, containing, at the + rate of twenty-pence the ounce, six ounces of silver, Tower weight, equal + to about thirty shillings of our present money. In the present times, + one-and-twenty shillings the tod may be reckoned a good price for very + good English wool. The money price of wool, therefore, in the time of + Edward III. was to its money price in the present times as ten to seven. + The superiority of its real price was still greater. At the rate of six + shillings and eightpence the quarter, ten shillings was in those ancient + times the price of twelve bushels of wheat. At the rate of twenty-eight + shillings the quarter, one-and-twenty shillings is in the present times + the price of six bushels only. The proportion between the real price of + ancient and modern times, therefore, is as twelve to six, or as two to + one. In those ancient times, a tod of wool would have purchased twice the + quantity of subsistence which it will purchase at present, and + consequently twice the quantity of labour, if the real recompence of + labour had been the same in both periods. + + This degradation, both in the real and nominal value of wool, could never + have happened in consequence of the natural course of things. It has + accordingly been the effect of violence and artifice. First, of the + absolute prohibition of exporting wool from England: secondly, of the + permission of importing it from Spain, duty free: thirdly, of the + prohibition of exporting it from Ireland to another country but England. + In consequence of these regulations, the market for English wool, instead + of being somewhat extended, in consequence of the improvement of England, + has been confined to the home market, where the wool of several other + countries is allowed to come into competition with it, and where that of + Ireland is forced into competition with it. As the woollen manufactures, + too, of Ireland, are fully as much discouraged as is consistent with + justice and fair dealing, the Irish can work up but a smaller part of + their own wool at home, and are therefore obliged to send a greater + proportion of it to Great Britain, the only market they are allowed. + + I have not been able to find any such authentic records concerning the + price of raw hides in ancient times. Wool was commonly paid as a subsidy + to the king, and its valuation in that subsidy ascertains, at least in + some degree, what was its ordinary price. But this seems not to have been + the case with raw hides. Fleetwood, however, from an account in 1425, + between the prior of Burcester Oxford and one of his canons, gives us + their price, at least as it was stated upon that particular occasion, viz. + five ox hides at twelve shillings; five cow hides at seven shillings and + threepence; thirtysix sheep skins of two years old at nine shillings; + sixteen calf skins at two shillings. In 1425, twelve shillings contained + about the same quantity of silver as four-and-twenty shillings of our + present money. An ox hide, therefore, was in this account valued at the + same quantity of silver as 4s. ⅘ths of our present money. Its nominal + price was a good deal lower than at present. But at the rate of six + shillings and eightpence the quarter, twelve shillings would in those + times have purchased fourteen bushels and four-fifths of a bushel of + wheat, which, at three and sixpence the bushel, would in the present times + cost 51s. 4d. An ox hide, therefore, would in those times have purchased + as much corn as ten shillings and threepence would purchase at present. + Its real value was equal to ten shillings and threepence of our present + money. In those ancient times, when the cattle were half starved during + the greater part of the winter, we cannot suppose that they were of a very + large size. An ox hide which weighs four stone of sixteen pounds of + avoirdupois, is not in the present times reckoned a bad one; and in those + ancient times would probably have been reckoned a very good one. But at + half-a-crown the stone, which at this moment (February 1773) I understand + to be the common price, such a hide would at present cost only ten + shillings. Through its nominal price, therefore, is higher in the present + than it was in those ancient times, its real price, the real quantity of + subsistence which it will purchase or command, is rather somewhat lower. + The price of cow hides, as stated in the above account, is nearly in the + common proportion to that of ox hides. That of sheep skins is a good deal + above it. They had probably been sold with the wool. That of calves skins, + on the contrary, is greatly below it. In countries where the price of + cattle is very low, the calves, which are not intended to be reared in + order to keep up the stock, are generally killed very young, as was the + case in Scotland twenty or thirty years ago. It saves the milk, which + their price would not pay for. Their skins, therefore, are commonly good + for little. + + The price of raw hides is a good deal lower at present than it was a few + years ago; owing probably to the taking off the duty upon seal skins, and + to the allowing, for a limited time, the importation of raw hides from + Ireland, and from the plantations, duty free, which was done in 1769. Take + the whole of the present century at an average, their real price has + probably been somewhat higher than it was in those ancient times. The + nature of the commodity renders it not quite so proper for being + transported to distant markets as wool. It suffers more by keeping. A + salted hide is reckoned inferior to a fresh one, and sells for a lower + price. This circumstance must necessarily have some tendency to sink the + price of raw hides produced in a country which does not manufacture them, + but is obliged to export them, and comparatively to raise that of those + produced in a country which does manufacture them. It must have some + tendency to sink their price in a barbarous, and to raise it in an + improved and manufacturing country. It must have had some tendency, + therefore, to sink it in ancient, and to raise it in modern times. Our + tanners, besides, have not been quite so successful as our clothiers, in + convincing the wisdom of the nation, that the safety of the commonwealth + depends upon the prosperity of their particular manufacture. They have + accordingly been much less favoured. The exportation of raw hides has, + indeed, been prohibited, and declared a nuisance; but their importation + from foreign countries has been subjected to a duty; and though this duty + has been taken off from those of Ireland and the plantations (for the + limited time of five years only), yet Ireland has not been confined to the + market of Great Britain for the sale of its surplus hides, or of those + which are not manufactured at home. The hides of common cattle have, but + within these few years, been put among the enumerated commodities which + the plantations can send nowhere but to the mother country; neither has + the commerce of Ireland been in this case oppressed hitherto, in order to + support the manufactures of Great Britain. + + Whatever regulations tend to sink the price, either of wool or of raw + hides, below what it naturally would be, must, in an improved and + cultivated country, have some tendency to raise the price of butcher’s + meat. The price both of the great and small cattle, which are fed on + improved and cultivated land, must be sufficient to pay the rent which the + landlord, and the profit which the farmer, has reason to expect from + improved and cultivated land. If it is not, they will soon cease to feed + them. Whatever part of this price, therefore, is not paid by the wool and + the hide, must be paid by the carcase. The less there is paid for the one, + the more must be paid for the other. In what manner this price is to be + divided upon the different parts of the beast, is indifferent to the + landlords and farmers, provided it is all paid to them. In an improved and + cultivated country, therefore, their interest as landlords and farmers + cannot be much affected by such regulations, though their interest as + consumers may, by the rise in the price of provisions. It would be quite + otherwise, however, in an unimproved and uncultivated country, where the + greater part of the lands could be applied to no other purpose but the + feeding of cattle, and where the wool and the hide made the principal part + of the value of those cattle. Their interest as landlords and farmers + would in this case be very deeply affected by such regulations, and their + interest as consumers very little. The fall in the price of the wool and + the hide would not in this case raise the price of the carcase; because + the greater part of the lands of the country being applicable to no other + purpose but the feeding of cattle, the same number would still continue to + be fed. The same quantity of butcher’s meat would still come to market. + The demand for it would be no greater than before. Its price, therefore, + would be the same as before. The whole price of cattle would fall, and + along with it both the rent and the profit of all those lands of which + cattle was the principal produce, that is, of the greater part of the + lands of the country. The perpetual prohibition of the exportation of + wool, which is commonly, but very falsely, ascribed to Edward III., would, + in the then circumstances of the country, have been the most destructive + regulation which could well have been thought of. It would not only have + reduced the actual value of the greater part of the lands in the kingdom, + but by reducing the price of the most important species of small cattle, + it would have retarded very much its subsequent improvement. + + The wool of Scotland fell very considerably in its price in consequence of + the union with England, by which it was excluded from the great market of + Europe, and confined to the narrow one of Great Britain. The value of the + greater part of the lands in the southern counties of Scotland, which are + chiefly a sheep country, would have been very deeply affected by this + event, had not the rise in the price of butcher’s meat fully compensated + the fall in the price of wool. + + As the efficacy of human industry, in increasing the quantity either of + wool or of raw hides, is limited, so far as it depends upon the produce of + the country where it is exerted; so it is uncertain so far as it depends + upon the produce of other countries. It so far depends not so much upon + the quantity which they produce, as upon that which they do not + manufacture; and upon the restraints which they may or may not think + proper to impose upon the exportation of this sort of rude produce. These + circumstances, as they are altogether independent of domestic industry, so + they necessarily render the efficacy of its efforts more or less + uncertain. In multiplying this sort of rude produce, therefore, the + efficacy of human industry is not only limited, but uncertain. + + In multiplying another very important sort of rude produce, the quantity + of fish that is brought to market, it is likewise both limited and + uncertain. It is limited by the local situation of the country, by the + proximity or distance of its different provinces from the sea, by the + number of its lakes and rivers, and by what may be called the fertility or + barrenness of those seas, lakes, and rivers, as to this sort of rude + produce. As population increases, as the annual produce of the land and + labour of the country grows greater and greater, there come to be more + buyers of fish; and those buyers, too, have a greater quantity and variety + of other goods, or, what is the same thing, the price of a greater + quantity and variety of other goods, to buy with. But it will generally be + impossible to supply the great and extended market, without employing a + quantity of labour greater than in proportion to what had been requisite + for supplying the narrow and confined one. A market which, from requiring + only one thousand, comes to require annually ten thousand ton of fish, can + seldom be supplied, without employing more than ten times the quantity of + labour which had before been sufficient to supply it. The fish must + generally be sought for at a greater distance, larger vessels must be + employed, and more expensive machinery of every kind made use of. The real + price of this commodity, therefore, naturally rises in the progress of + improvement. It has accordingly done so, I believe, more or less in every + country. + + Though the success of a particular day’s fishing may be a very uncertain + matter, yet the local situation of the country being supposed, the general + efficacy of industry in bringing a certain quantity of fish to market, + taking the course of a year, or of several years together, it may, + perhaps, be thought is certain enough; and it, no doubt, is so. As it + depends more, however, upon the local situation of the country, than upon + the state of its wealth and industry; as upon this account it may in + different countries be the same in very different periods of improvement, + and very different in the same period; its connection with the state of + improvement is uncertain; and it is of this sort of uncertainty that I am + here speaking. + + In increasing the quantity of the different minerals and metals which are + drawn from the bowels of the earth, that of the more precious ones + particularly, the efficacy of human industry seems not to be limited, but + to be altogether uncertain. + + The quantity of the precious metals which is to be found in any country, + is not limited by any thing in its local situation, such as the fertility + or barrenness of its own mines. Those metals frequently abound in + countries which possess no mines. Their quantity, in every particular + country, seems to depend upon two different circumstances; first, upon its + power of purchasing, upon the state of its industry, upon the annual + produce of its land and labour, in consequence of which it can afford to + employ a greater or a smaller quantity of labour and subsistence, in + bringing or purchasing such superfluities as gold and silver, either from + its own mines, or from those of other countries; and, secondly, upon the + fertility or barrenness of the mines which may happen at any particular + time to supply the commercial world with those metals. The quantity of + those metals in the countries most remote from the mines, must be more or + less affected by this fertility or barrenness, on account of the easy and + cheap transportation of those metals, of their small bulk and great value. + Their quantity in China and Indostan must have been more or less affected + by the abundance of the mines of America. + + So far as their quantity in any particular country depends upon the former + of those two circumstances (the power of purchasing), their real price, + like that of all other luxuries and superfluities, is likely to rise with + the wealth and improvement of the country, and to fall with its poverty + and depression. Countries which have a great quantity of labour and + subsistence to spare, can afford to purchase any particular quantity of + those metals at the expense of a greater quantity of labour and + subsistence, than countries which have less to spare. + + So far as their quantity in any particular country depends upon the latter + of those two circumstances (the fertility or barrenness of the mines which + happen to supply the commercial world), their real price, the real + quantity of labour and subsistence which they will purchase or exchange + for, will, no doubt, sink more or less in proportion to the fertility, and + rise in proportion to the barrenness of those mines. + + The fertility or barrenness of the mines, however, which may happen at any + particular time to supply the commercial world, is a circumstance which, + it is evident, may have no sort of connection with the state of industry + in a particular country. It seems even to have no very necessary + connection with that of the world in general. As arts and commerce, + indeed, gradually spread themselves over a greater and a greater part of + the earth, the search for new mines, being extended over a wider surface, + may have somewhat a better chance for being successful than when confined + within narrower bounds. The discovery of new mines, however, as the old + ones come to be gradually exhausted, is a matter of the greatest + uncertainty, and such as no human skill or industry can insure. All + indications, it is acknowledged, are doubtful; and the actual discovery + and successful working of a new mine can alone ascertain the reality of + its value, or even of its existence. In this search there seem to be no + certain limits, either to the possible success, or to the possible + disappointment of human industry. In the course of a century or two, it is + possible that new mines may be discovered, more fertile than any that have + ever yet been known; and it is just equally possible, that the most + fertile mine then known may be more barren than any that was wrought + before the discovery of the mines of America. Whether the one or the other + of those two events may happen to take place, is of very little importance + to the real wealth and prosperity of the world, to the real value of the + annual produce of the land and labour of mankind. Its nominal value, the + quantity of gold and silver by which this annual produce could be + expressed or represented, would, no doubt, be very different; but its real + value, the real quantity of labour which it could purchase or command, + would be precisely the same. A shilling might, in the one case, represent + no more labour than a penny does at present; and a penny, in the other, + might represent as much as a shilling does now. But in the one case, he + who had a shilling in his pocket would be no richer than he who has a + penny at present; and in the other, he who had a penny would be just as + rich as he who has a shilling now. The cheapness and abundance of gold and + silver plate would be the sole advantage which the world could derive from + the one event; and the dearness and scarcity of those trifling + superfluities, the only inconveniency it could suffer from the other. + + + + + Conclusion of the Digression concerning the Variations in the Value of + Silver. + + The greater part of the writers who have collected the money price of + things in ancient times, seem to have considered the low money price of + corn, and of goods in general, or, in other words, the high value of gold + and silver, as a proof, not only of the scarcity of those metals, but of + the poverty and barbarism of the country at the time when it took place. + This notion is connected with the system of political economy, which + represents national wealth as consisting in the abundance and national + poverty in the scarcity, of gold and silver; a system which I shall + endeavour to explain and examine at great length in the fourth book of + this Inquiry. I shall only observe at present, that the high value of the + precious metals can be no proof of the poverty or barbarism of any + particular country at the time when it took place. It is a proof only of + the barrenness of the mines which happened at that time to supply the + commercial world. A poor country, as it cannot afford to buy more, so it + can as little afford to pay dearer for gold and silver than a rich one; + and the value of those metals, therefore, is not likely to be higher in + the former than in the latter. In China, a country much richer than any + part of Europe, the value of the precious metals is much higher than in + any part of Europe. As the wealth of Europe, indeed, has increased greatly + since the discovery of the mines of America, so the value of gold and + silver has gradually diminished. This diminution of their value, however, + has not been owing to the increase of the real wealth of Europe, of the + annual produce of its land and labour, but to the accidental discovery of + more abundant mines than any that were known before. The increase of the + quantity of gold and silver in Europe, and the increase of its + manufactures and agriculture, are two events which, though they have + happened nearly about the same time, yet have arisen from very different + causes, and have scarce any natural connection with one another. The one + has arisen from a mere accident, in which neither prudence nor policy + either had or could have any share; the other, from the fall of the feudal + system, and from the establishment of a government which afforded to + industry the only encouragement which it requires, some tolerable security + that it shall enjoy the fruits of its own labour. Poland, where the feudal + system still continues to take place, is at this day as beggarly a country + as it was before the discovery of America. The money price of corn, + however, has risen; the real value of the precious metals has fallen in + Poland, in the same manner as in other parts of Europe. Their quantity, + therefore, must have increased there as in other places, and nearly in the + same proportion to the annual produce of its land and labour. This + increase of the quantity of those metals, however, has not, it seems, + increased that annual produce, has neither improved the manufactures and + agriculture of the country, nor mended the circumstances of its + inhabitants. Spain and Portugal, the countries which possess the mines, + are, after Poland, perhaps the two most beggarly countries in Europe. The + value of the precious metals, however, must be lower in Spain and Portugal + than in any other part of Europe, as they come from those countries to all + other parts of Europe, loaded, not only with a freight and an insurance, + but with the expense of smuggling, their exportation being either + prohibited or subjected to a duty. In proportion to the annual produce of + the land and labour, therefore, their quantity must be greater in those + countries than in any other part of Europe; those countries, however, are + poorer than the greater part of Europe. Though the feudal system has been + abolished in Spain and Portugal, it has not been succeeded by a much + better. + + As the low value of gold and silver, therefore, is no proof of the wealth + and flourishing state of the country where it takes place; so neither is + their high value, or the low money price either of goods in general, or of + corn in particular, any proof of its poverty and barbarism. + + But though the low money price, either of goods in general, or of corn in + particular, be no proof of the poverty or barbarism of the times, the low + money price of some particular sorts of goods, such as cattle, poultry, + game of all kinds, etc. in proportion to that of corn, is a most decisive + one. It clearly demonstrates, first, their great abundance in proportion + to that of corn, and, consequently, the great extent of the land which + they occupied in proportion to what was occupied by corn; and, secondly, + the low value of this land in proportion to that of corn land, and, + consequently, the uncultivated and unimproved state of the far greater + part of the lands of the country. It clearly demonstrates, that the stock + and population of the country did not bear the same proportion to the + extent of its territory, which they commonly do in civilized countries; + and that society was at that time, and in that country, but in its + infancy. From the high or low money price, either of goods in general, or + of corn in particular, we can infer only, that the mines, which at that + time happened to supply the commercial world with gold and silver, were + fertile or barren, not that the country was rich or poor. But from the + high or low money price of some sorts of goods in proportion to that of + others, we can infer, with a degree of probability that approaches almost + to certainty, that it was rich or poor, that the greater part of its lands + were improved or unimproved, and that it was either in a more or less + barbarous state, or in a more or less civilized one. + + Any rise in the money price of goods which proceeded altogether from the + degradation of the value of silver, would affect all sorts of goods + equally, and raise their price universally, a third, or a fourth, or a + fifth part higher, according as silver happened to lose a third, or a + fourth, or a fifth part of its former value. But the rise in the price of + provisions, which has been the subject of so much reasoning and + conversation, does not affect all sorts of provisions equally. Taking the + course of the present century at an average, the price of corn, it is + acknowledged, even by those who account for this rise by the degradation + of the value of silver, has risen much less than that of some other sorts + of provisions. The rise in the price of those other sorts of provisions, + therefore, cannot be owing altogether to the degradation of the value of + silver. Some other causes must be taken into the account; and those which + have been above assigned, will, perhaps, without having recourse to the + supposed degradation of the value of silver, sufficiently explain this + rise in those particular sorts of provisions, of which the price has + actually risen in proportion to that of corn. + + As to the price of corn itself, it has, during the sixty-four first years + of the present century, and before the late extraordinary course of bad + seasons, been somewhat lower than it was during the sixty-four last years + of the preceding century. This fact is attested, not only by the accounts + of Windsor market, but by the public fiars of all the different counties + of Scotland, and by the accounts of several different markets in France, + which have been collected with great diligence and fidelity by Mr + Messance, and by Mr Dupré de St Maur. The evidence is more complete than + could well have been expected in a matter which is naturally so very + difficult to be ascertained. + + As to the high price of corn during these last ten or twelve years, it can + be sufficiently accounted for from the badness of the seasons, without + supposing any degradation in the value of silver. + + The opinion, therefore, that silver is continually sinking in its value, + seems not to be founded upon any good observations, either upon the prices + of corn, or upon those of other provisions. + + The same quantity of silver, it may perhaps be said, will, in the present + times, even according to the account which has been here given, purchase a + much smaller quantity of several sorts of provisions than it would have + done during some part of the last century; and to ascertain whether this + change be owing to a rise in the value of those goods, or to a fall in the + value of silver, is only to establish a vain and useless distinction, + which can be of no sort of service to the man who has only a certain + quantity of silver to go to market with, or a certain fixed revenue in + money. I certainly do not pretend that the knowledge of this distinction + will enable him to buy cheaper. It may not, however, upon that account be + altogether useless. + + It may be of some use to the public, by affording an easy proof of the + prosperous condition of the country. If the rise in the price of some + sorts of provisions be owing altogether to a fall in the value of silver, + it is owing to a circumstance, from which nothing can be inferred but the + fertility of the American mines. The real wealth of the country, the + annual produce of its land and labour, may, notwithstanding this + circumstance, be either gradually declining, as in Portugal and Poland; or + gradually advancing, as in most other parts of Europe. But if this rise in + the price of some sorts of provisions be owing to a rise in the real value + of the land which produces them, to its increased fertility, or, in + consequence of more extended improvement and good cultivation, to its + having been rendered fit for producing corn; it is owing to a circumstance + which indicates, in the clearest manner, the prosperous and advancing + state of the country. The land constitutes by far the greatest, the most + important, and the most durable part of the wealth of every extensive + country. It may surely be of some use, or, at least, it may give some + satisfaction to the public, to have so decisive a proof of the increasing + value of by far the greatest, the most important, and the most durable + part of its wealth. + + It may, too, be of some use to the public, in regulating the pecuniary + reward of some of its inferior servants. If this rise in the price of some + sorts of provisions be owing to a fall in the value of silver, their + pecuniary reward, provided it was not too large before, ought certainly to + be augmented in proportion to the extent of this fall. If it is not + augmented, their real recompence will evidently be so much diminished. But + if this rise of price is owing to the increased value, in consequence of + the improved fertility of the land which produces such provisions, it + becomes a much nicer matter to judge, either in what proportion any + pecuniary reward ought to be augmented, or whether it ought to be + augmented at all. The extension of improvement and cultivation, as it + necessarily raises more or less, in proportion to the price of corn, that + of every sort of animal food, so it as necessarily lowers that of, I + believe, every sort of vegetable food. It raises the price of animal food; + because a great part of the land which produces it, being rendered fit for + producing corn, must afford to the landlord and farmer the rent and + profit of corn land. It lowers the price of vegetable food; because, by + increasing the fertility of the land, it increases its abundance. The + improvements of agriculture, too, introduce many sorts of vegetable food, + which requiring less land, and not more labour than corn, come much + cheaper to market. Such are potatoes and maize, or what is called Indian + corn, the two most important improvements which the agriculture of Europe, + perhaps, which Europe itself, has received from the great extension of its + commerce and navigation. Many sorts of vegetable food, besides, which in + the rude state of agriculture are confined to the kitchen-garden, and + raised only by the spade, come, in its improved state, to be introduced + into common fields, and to be raised by the plough; such as turnips, + carrots, cabbages, etc. If, in the progress of improvement, therefore, the + real price of one species of food necessarily rises, that of another as + necessarily falls; and it becomes a matter of more nicety to judge how far + the rise in the one may be compensated by the fall in the other. When the + real price of butcher’s meat has once got to its height (which, with + regard to every sort, except perhaps that of hogs flesh, it seems to have + done through a great part of England more than a century ago), any rise + which can afterwards happen in that of any other sort of animal food, + cannot much affect the circumstances of the inferior ranks of people. The + circumstances of the poor, through a great part of England, cannot surely + be so much distressed by any rise in the price of poultry, fish, + wild-fowl, or venison, as they must be relieved by the fall in that of + potatoes. + + In the present season of scarcity, the high price of corn no doubt + distresses the poor. But in times of moderate plenty, when corn is at its + ordinary or average price, the natural rise in the price of any other sort + of rude produce cannot much affect them. They suffer more, perhaps, by the + artificial rise which has been occasioned by taxes in the price of some + manufactured commodities, as of salt, soap, leather, candles, malt, beer, + ale, etc. + + + _Effects of the Progress of Improvement upon the real Price of + Manufactures._ + + + It is the natural effect of improvement, however, to diminish gradually + the real price of almost all manufactures. That of the manufacturing + workmanship diminishes, perhaps, in all of them without exception. In + consequence of better machinery, of greater dexterity, and of a more + proper division and distribution of work, all of which are the natural + effects of improvement, a much smaller quantity of labour becomes + requisite for executing any particular piece of work; and though, in + consequence of the flourishing circumstances of the society, the real + price of labour should rise very considerably, yet the great diminution of + the quantity will generally much more than compensate the greatest rise + which can happen in the price. + + There are, indeed, a few manufactures, in which the necessary rise in the + real price of the rude materials will more than compensate all the + advantages which improvement can introduce into the execution of the work. + In carpenters’ and joiners’ work, and in the coarser sort of cabinet work, + the necessary rise in the real price of barren timber, in consequence of + the improvement of land, will more than compensate all the advantages + which can be derived from the best machinery, the greatest dexterity, and + the most proper division and distribution of work. + + But in all cases in which the real price of the rude material either does + not rise at all, or does not rise very much, that of the manufactured + commodity sinks very considerably. + + This diminution of price has, in the course of the present and preceding + century, been most remarkable in those manufactures of which the materials + are the coarser metals. A better movement of a watch, than about the + middle of the last century could have been bought for twenty pounds, may + now perhaps be had for twenty shillings. In the work of cutlers and + locksmiths, in all the toys which are made of the coarser metals, and in + all those goods which are commonly known by the name of Birmingham and + Sheffield ware, there has been, during the same period, a very great + reduction of price, though not altogether so great as in watch-work. It + has, however, been sufficient to astonish the workmen of every other part + of Europe, who in many cases acknowledge that they can produce no work of + equal goodness for double or even for triple the price. There are perhaps + no manufactures, in which the division of labour can be carried further, + or in which the machinery employed admits of a greater variety of + improvements, than those of which the materials are the coarser metals. + + In the clothing manufacture there has, during the same period, been no + such sensible reduction of price. The price of superfine cloth, I have + been assured, on the contrary, has, within these five-and-twenty or thirty + years, risen somewhat in proportion to its quality, owing, it was said, to + a considerable rise in the price of the material, which consists + altogether of Spanish wool. That of the Yorkshire cloth, which is made + altogether of English wool, is said, indeed, during the course of the + present century, to have fallen a good deal in proportion to its quality. + Quality, however, is so very disputable a matter, that I look upon all + information of this kind as somewhat uncertain. In the clothing + manufacture, the division of labour is nearly the same now as it was a + century ago, and the machinery employed is not very different. There may, + however, have been some small improvements in both, which may have + occasioned some reduction of price. + + But the reduction will appear much more sensible and undeniable, if we + compare the price of this manufacture in the present times with what it + was in a much remoter period, towards the end of the fifteenth century, + when the labour was probably much less subdivided, and the machinery + employed much more imperfect, than it is at present. + + In 1487, being the 4th of Henry VII., it was enacted, that “whosoever + shall sell by retail a broad yard of the finest scarlet grained, or of + other grained cloth of the finest making, above sixteen shillings, shall + forfeit forty shillings for every yard so sold.” Sixteen shillings, + therefore, containing about the same quantity of silver as four-and-twenty + shillings of our present money, was, at that time, reckoned not an + unreasonable price for a yard of the finest cloth; and as this is a + sumptuary law, such cloth, it is probable, had usually been sold somewhat + dearer. A guinea may be reckoned the highest price in the present times. + Even though the quality of the cloths, therefore, should be supposed + equal, and that of the present times is most probably much superior, yet, + even upon this supposition, the money price of the finest cloth appears to + have been considerably reduced since the end of the fifteenth century. But + its real price has been much more reduced. Six shillings and eightpence + was then, and long afterwards, reckoned the average price of a quarter of + wheat. Sixteen shillings, therefore, was the price of two quarters and + more than three bushels of wheat. Valuing a quarter of wheat in the + present times at eight-and-twenty shillings, the real price of a yard of + fine cloth must, in those times, have been equal to at least three pounds + six shillings and sixpence of our present money. The man who bought it + must have parted with the command of a quantity of labour and subsistence + equal to what that sum would purchase in the present times. + + The reduction in the real price of the coarse manufacture, though + considerable, has not been so great as in that of the fine. + + In 1463, being the 3rd of Edward IV. it was enacted, that “no servant in + husbandry nor common labourer, nor servant to any artificer inhabiting out + of a city or burgh, shall use or wear in their clothing any cloth above + two shillings the broad yard.” In the 3rd of Edward IV., two shillings + contained very nearly the same quantity of silver as four of our present + money. But the Yorkshire cloth which is now sold at four shillings the + yard, is probably much superior to any that was then made for the wearing + of the very poorest order of common servants. Even the money price of + their clothing, therefore, may, in proportion to the quality, be somewhat + cheaper in the present than it was in those ancient times. The real price + is certainly a good deal cheaper. Tenpence was then reckoned what is + called the moderate and reasonable price of a bushel of wheat. Two + shillings, therefore, was the price of two bushels and near two pecks of + wheat, which in the present times, at three shillings and sixpence the + bushel, would be worth eight shillings and ninepence. For a yard of this + cloth the poor servant must have parted with the power of purchasing a + quantity of subsistence equal to what eight shillings and ninepence would + purchase in the present times. This is a sumptuary law, too, restraining + the luxury and extravagance of the poor. Their clothing, therefore, had + commonly been much more expensive. + + The same order of people are, by the same law, prohibited from wearing + hose, of which the price should exceed fourteen-pence the pair, equal to + about eight-and-twenty pence of our present money. But fourteen-pence was + in those times the price of a bushel and near two pecks of wheat; which in + the present times, at three and sixpence the bushel, would cost five + shillings and threepence. We should in the present times consider this as + a very high price for a pair of stockings to a servant of the poorest and + lowest order. He must however, in those times, have paid what was really + equivalent to this price for them. + + In the time of Edward IV. the art of knitting stockings was probably not + known in any part of Europe. Their hose were made of common cloth, which + may have been one of the causes of their dearness. The first person that + wore stockings in England is said to have been Queen Elizabeth. She + received them as a present from the Spanish ambassador. + + Both in the coarse and in the fine woollen manufacture, the machinery + employed was much more imperfect in those ancient, than it is in the + present times. It has since received three very capital improvements, + besides, probably, many smaller ones, of which it may be difficult to + ascertain either the number or the importance. The three capital + improvements are, first, the exchange of the rock and spindle for the + spinning-wheel, which, with the same quantity of labour, will perform more + than double the quantity of work. Secondly, the use of several very + ingenious machines, which facilitate and abridge, in a still greater + proportion, the winding of the worsted and woollen yarn, or the proper + arrangement of the warp and woof before they are put into the loom; an + operation which, previous to the invention of those machines, must have + been extremely tedious and troublesome. Thirdly, the employment of the + fulling-mill for thickening the cloth, instead of treading it in water. + Neither wind nor water mills of any kind were known in England so early as + the beginning of the sixteenth century, nor, so far as I know, in any + other part of Europe north of the Alps. They had been introduced into + Italy some time before. + + The consideration of these circumstances may, perhaps, in some measure, + explain to us why the real price both of the coarse and of the fine + manufacture was so much higher in those ancient than it is in the present + times. It cost a greater quantity of labour to bring the goods to market. + When they were brought thither, therefore, they must have purchased, or + exchanged for the price of, a greater quantity. + + The coarse manufacture probably was, in those ancient times, carried on in + England in the same manner as it always has been in countries where arts + and manufactures are in their infancy. It was probably a household + manufacture, in which every different part of the work was occasionally + performed by all the different members of almost every private family, but + so as to be their work only when they had nothing else to do, and not to + be the principal business from which any of them derived the greater part + of their subsistence. The work which is performed in this manner, it has + already been observed, comes always much cheaper to market than that which + is the principal or sole fund of the workman’s subsistence. The fine + manufacture, on the other hand, was not, in those times, carried on in + England, but in the rich and commercial country of Flanders; and it was + probably conducted then, in the same manner as now, by people who derived + the whole, or the principal part of their subsistence from it. It was, + besides, a foreign manufacture, and must have paid some duty, the ancient + custom of tonnage and poundage at least, to the king. This duty, indeed, + would not probably be very great. It was not then the policy of Europe to + restrain, by high duties, the importation of foreign manufactures, but + rather to encourage it, in order that merchants might be enabled to + supply, at as easy a rate as possible, the great men with the + conveniencies and luxuries which they wanted, and which the industry of + their own country could not afford them. + + The consideration of these circumstances may, perhaps, in some measure + explain to us why, in those ancient times, the real price of the coarse + manufacture was, in proportion to that of the fine, so much lower than in + the present times. + + + + + Conclusion of the Chapter. + + I shall conclude this very long chapter with observing, that every + improvement in the circumstances of the society tends, either directly or + indirectly, to raise the real rent of land to increase the real wealth of + the landlord, his power of purchasing the labour, or the produce of the + labour of other people. + + The extension of improvement and cultivation tends to raise it directly. + The landlord’s share of the produce necessarily increases with the + increase of the produce. + + That rise in the real price of those parts of the rude produce of land, + which is first the effect of the extended improvement and cultivation, and + afterwards the cause of their being still further extended, the rise in + the price of cattle, for example, tends, too, to raise the rent of land + directly, and in a still greater proportion. The real value of the + landlord’s share, his real command of the labour of other people, not only + rises with the real value of the produce, but the proportion of his share + to the whole produce rises with it. + + That produce, after the rise in its real price, requires no more labour to + collect it than before. A smaller proportion of it will, therefore, be + sufficient to replace, with the ordinary profit, the stock which employs + that labour. A greater proportion of it must consequently belong to the + landlord. + + All those improvements in the productive powers of labour, which tend + directly to reduce the rent price of manufactures, tend indirectly to + raise the real rent of land. The landlord exchanges that part of his rude + produce, which is over and above his own consumption, or, what comes to + the same thing, the price of that part of it, for manufactured produce. + Whatever reduces the real price of the latter, raises that of the former. + An equal quantity of the former becomes thereby equivalent to a greater + quantity of the latter; and the landlord is enabled to purchase a greater + quantity of the conveniencies, ornaments, or luxuries which he has + occasion for. + + Every increase in the real wealth of the society, every increase in the + quantity of useful labour employed within it, tends indirectly to raise + the real rent of land. A certain proportion of this labour naturally goes + to the land. A greater number of men and cattle are employed in its + cultivation, the produce increases with the increase of the stock which is + thus employed in raising it, and the rent increases with the produce. + + The contrary circumstances, the neglect of cultivation and improvement, + the fall in the real price of any part of the rude produce of land, the + rise in the real price of manufactures from the decay of manufacturing art + and industry, the declension of the real wealth of the society, all tend, + on the other hand, to lower the real rent of land, to reduce the real + wealth of the landlord, to diminish his power of purchasing either the + labour, or the produce of the labour, of other people. + + The whole annual produce of the land and labour of every country, or, what + comes to the same thing, the whole price of that annual produce, naturally + divides itself, it has already been observed, into three parts; the rent + of land, the wages of labour, and the profits of stock; and constitutes a + revenue to three different orders of people; to those who live by rent, to + those who live by wages, and to those who live by profit. These are the + three great, original, and constituent, orders of every civilized society, + from whose revenue that of every other order is ultimately derived. + + The interest of the first of those three great orders, it appears from + what has been just now said, is strictly and inseparably connected with + the general interest of the society. Whatever either promotes or obstructs + the one, necessarily promotes or obstructs the other. When the public + deliberates concerning any regulation of commerce or police, the + proprietors of land never can mislead it, with a view to promote the + interest of their own particular order; at least, if they have any + tolerable knowledge of that interest. They are, indeed, too often + defective in this tolerable knowledge. They are the only one of the three + orders whose revenue costs them neither labour nor care, but comes to + them, as it were, of its own accord, and independent of any plan or + project of their own. That indolence which is the natural effect of the + ease and security of their situation, renders them too often, not only + ignorant, but incapable of that application of mind, which is necessary in + order to foresee and understand the consequence of any public regulation. + + The interest of the second order, that of those who live by wages, is as + strictly connected with the interest of the society as that of the first. + The wages of the labourer, it has already been shewn, are never so high as + when the demand for labour is continually rising, or when the quantity + employed is every year increasing considerably. When this real wealth of + the society becomes stationary, his wages are soon reduced to what is + barely enough to enable him to bring up a family, or to continue the race + of labourers. When the society declines, they fall even below this. The + order of proprietors may perhaps gain more by the prosperity of the + society than that of labourers; but there is no order that suffers so + cruelly from its decline. But though the interest of the labourer is + strictly connected with that of the society, he is incapable either of + comprehending that interest, or of understanding its connexion with his + own. His condition leaves him no time to receive the necessary + information, and his education and habits are commonly such as to render + him unfit to judge, even though he was fully informed. In the public + deliberations, therefore, his voice is little heard, and less regarded; + except upon particular occasions, when his clamour is animated, set on, + and supported by his employers, not for his, but their own particular + purposes. + + His employers constitute the third order, that of those who live by + profit. It is the stock that is employed for the sake of profit, which + puts into motion the greater part of the useful labour of every society. + The plans and projects of the employers of stock regulate and direct all + the most important operation of labour, and profit is the end proposed by + all those plans and projects. But the rate of profit does not, like rent + and wages, rise with the prosperity, and fall with the declension of the + society. On the contrary, it is naturally low in rich, and high in poor + countries, and it is always highest in the countries which are going + fastest to ruin. The interest of this third order, therefore, has not the + same connexion with the general interest of the society, as that of the + other two. Merchants and master manufacturers are, in this order, the two + classes of people who commonly employ the largest capitals, and who by + their wealth draw to themselves the greatest share of the public + consideration. As during their whole lives they are engaged in plans and + projects, they have frequently more acuteness of understanding than the + greater part of country gentlemen. As their thoughts, however, are + commonly exercised rather about the interest of their own particular + branch of business. than about that of the society, their judgment, even + when given with the greatest candour (which it has not been upon every + occasion), is much more to be depended upon with regard to the former of + those two objects, than with regard to the latter. Their superiority over + the country gentleman is, not so much in their knowledge of the public + interest, as in their having a better knowledge of their own interest than + he has of his. It is by this superior knowledge of their own interest that + they have frequently imposed upon his generosity, and persuaded him to + give up both his own interest and that of the public, from a very simple + but honest conviction, that their interest, and not his, was the interest + of the public. The interest of the dealers, however, in any particular + branch of trade or manufactures, is always in some respects different + from, and even opposite to, that of the public. To widen the market, and + to narrow the competition, is always the interest of the dealers. To widen + the market may frequently be agreeable enough to the interest of the + public; but to narrow the competition must always be against it, and can + only serve to enable the dealers, by raising their profits above what they + naturally would be, to levy, for their own benefit, an absurd tax upon the + rest of their fellow-citizens. The proposal of any new law or regulation + of commerce which comes from this order, ought always to be listened to + with great precaution, and ought never to be adopted till after having + been long and carefully examined, not only with the most scrupulous, but + with the most suspicious attention. It comes from an order of men, whose + interest is never exactly the same with that of the public, who have + generally an interest to deceive and even to oppress the public, and who + accordingly have, upon many occasions, both deceived and oppressed it. + + # PRICES OF WHEAT + + + Year Prices/Quarter Average of different Average prices of + in each year prices in one year each year in money + of 1776 + + £ s d £ s d £ s d + 1202 0 12 0 1 16 0 + 1205 0 12 0 + 0 13 4 0 13 5 2 0 3 + 0 15 0 + 1223 0 12 0 1 16 0 + 1237 0 3 4 0 10 0 + 1243 0 2 0 0 6 0 + 1244 0 2 0 0 6 0 + 1246 0 16 0 2 8 0 + 1247 0 13 5 2 0 0 + 1257 1 4 0 3 12 0 + 1258 1 0 0 + 0 15 0 0 17 0 2 11 0 + 0 16 0 + 1270 4 16 0 + 6 8 0 5 12 0 16 16 0 + 1286 0 2 8 + 0 16 0 0 9 4 1 8 0 + Total 35 9 3 + Average 2 19 1¼ + + 1287 0 3 4 0 10 0 + 1288 0 0 8 + 0 1 0 + 0 1 4 + 0 1 6 + 0 1 8 0 3 0¼ 0 9 1¾ + 0 2 0 + 0 3 4 + 0 9 4 + 1289 0 12 0 + 0 6 0 + 0 2 0 0 10 1½ 1 10 4½ + 0 10 8 + 1 0 0 + 1290 0 16 0 2 8 0 + 1294 0 16 0 2 8 0 + 1302 0 4 0 0 12 0 + 1309 0 7 2 1 1 6 + 1315 1 0 0 3 0 0 + 1316 1 0 0 + 1 10 0 1 10 6 4 11 6 + 1 12 0 + 2 0 0 + 1317 2 4 0 + 0 14 0 + 2 13 0 1 19 6 5 18 6 + 4 0 0 + 0 6 8 + 1336 0 2 0 0 6 0 + 1338 0 3 4 0 10 0 + Total 23 4 11¼ + Average 1 18 8 + + 1339 0 9 0 1 7 0 + 1349 0 2 0 0 5 2 + 1359 1 6 8 3 2 2 + 1361 0 2 0 0 4 8 + 1363 0 15 0 1 15 0 + 1369 1 0 0 + 1 4 0 1 2 0 2 9 4 + 1379 0 4 0 0 9 4 + 1387 0 2 0 0 4 8 + 1390 0 13 4 + 0 14 0 0 14 5 1 13 7 + 0 16 0 + 1401 0 16 0 1 17 6 + 1407 0 4 4¾ + 0 3 4 0 3 10 0 8 10 + 1416 0 16 0 1 12 0 + Total 15 9 4 + Average 1 5 9½ + + 1423 0 8 0 0 + 1425 0 4 0 0 + 1434 1 6 8 4 + 1435 0 5 4 8 + 1439 1 0 0 + 1 6 8 1 3 4 2 6 8 + 1440 1 4 0 2 8 0 + 1444 0 4 4 0 4 2 0 4 8 + 0 4 0 + 1445 0 4 6 0 9 0 + 1447 0 8 0 0 16 0 + 1448 0 6 8 0 13 4 + 1449 0 5 0 0 10 0 + 1451 0 8 0 0 16 0 + Total 12 15 4 + Average 1 1 3⅓ + + 1453 0 5 4 0 10 8 + 1455 0 1 2 0 2 4 + 1457 0 7 8 1 15 4 + 1459 0 5 0 0 10 0 + 1460 0 8 0 0 16 0 + 1463 0 2 0 0 1 10 0 3 8 + 0 1 8 + 1464 0 6 8 0 10 0 + 1486 1 4 0 1 17 0 + 1491 0 14 8 1 2 0 + 1494 0 4 0 0 6 0 + 1495 0 3 4 0 5 0 + 1497 1 0 0 1 11 0 + Total 8 9 0 + Average 0 14 1 + + 1499 0 4 0 0 6 0 + 1504 0 5 8 0 8 6 + 1521 1 0 0 1 10 0 + 1551 0 8 0 0 8 0 + 1553 0 8 0 0 8 0 + 1554 0 8 0 0 8 0 + 1555 0 8 0 0 8 0 + 1556 0 8 0 0 8 0 + 1557 0 8 0 + 0 4 0 0 17 8½ 0 17 8½ + 0 5 0 + 2 13 4 + 1558 0 8 0 0 8 0 + 1559 0 8 0 0 8 0 + 1560 0 8 0 0 8 0 + Total 6 0 2½ + Average 0 10 0½ + + 1561 0 8 0 0 8 0 + 1562 0 8 0 0 8 0 + 1574 2 16 0 + 1 4 0 2 0 0 2 0 0 + 1587 3 4 0 3 4 0 + 1594 2 16 0 2 16 0 + 1595 2 13 0 2 13 0 + 1596 4 0 0 4 0 0 + 1597 5 4 0 + 4 0 0 4 12 0 4 12 0 + 1598 2 16 8 2 16 8 + 1599 1 19 2 1 19 8 + 1600 1 17 8 1 17 8 + 1601 1 14 10 1 14 10 + Total 28 9 4 + Average 2 7 5½ + + + + PRICES OF THE QUARTER OF NINE BUSHELS OF THE BEST OR HIGHEST PRICED WHEAT + AT WINDSOR MARKET, ON LADY DAY AND MICHAELMAS, FROM 1595 TO 1764 BOTH + INCLUSIVE; THE PRICE OF EACH YEAR BEING THE MEDIUM BETWEEN THE HIGHEST + PRICES OF THESE TWO MARKET DAYS. + + + £ s d + 1595 2 0 0 + 1596 2 8 0 + 1597 3 9 6 + 1598 2 16 8 + 1599 1 19 2 + 1600 1 17 8 + 1601 1 14 10 + 1602 1 9 4 + 1603 1 15 4 + 1604 1 10 8 + 1605 1 15 10 + 1606 1 13 0 + 1607 1 16 8 + 1608 2 16 8 + 1609 2 10 0 + 1610 1 15 10 + 1611 1 18 8 + 1612 2 2 4 + 1613 2 8 8 + 1614 2 1 8½ + 1615 1 18 8 + 1616 2 0 4 + 1617 2 8 8 + 1618 2 6 8 + 1619 1 15 4 + 1620 1 10 4 + 26)54 0 6½ + Average 2 1 6¾ + + 1621 1 10 4 + 1622 2 18 8 + 1623 2 12 0 + 1624 2 8 0 + 1625 2 12 0 + 1626 2 9 4 + 1627 1 16 0 + 1628 1 8 0 + 1629 2 2 0 + 1630 2 15 8 + 1631 3 8 0 + 1632 2 13 4 + 1633 2 18 0 + 1634 2 16 0 + 1635 2 16 0 + 1636 2 16 8 + 16)40 0 0 + Average 2 10 0 + + 1637 2 13 0 + 1638 2 17 4 + 1639 2 4 10 + 1640 2 4 8 + 1641 2 8 0 + 1646 2 8 0 + 1647 3 13 0 + 1648 4 5 0 + 1649 4 0 0 + 1650 3 16 8 + 1651 3 13 4 + 1652 2 9 6 + 1653 1 15 6 + 1654 1 6 0 + 1655 1 13 4 + 1656 2 3 0 + 1657 2 6 8 + 1658 3 5 0 + 1659 3 6 0 + 1660 2 16 6 + 1661 3 10 0 + 1662 3 14 0 + 1663 2 17 0 + 1664 2 0 6 + 1665 2 9 4 + 1666 1 16 0 + 1667 1 16 0 + 1668 2 0 0 + 1669 2 4 4 + 1670 2 1 8 + 1671 2 2 0 + 1672 2 1 0 + 1673 2 6 8 + 1674 3 8 8 + 1675 3 4 8 + 1676 1 18 0 + 1677 2 2 0 + 1678 2 19 0 + 1679 3 0 0 + 1680 2 5 0 + 1681 2 6 8 + 1682 2 4 0 + 1683 2 0 0 + 1684 2 4 0 + 1685 2 6 8 + 1686 1 14 0 + 1687 1 5 2 + 1688 2 6 0 + 1689 1 10 0 + 1690 1 14 8 + 1691 1 14 0 + 1692 2 6 8 + 1693 3 7 8 + 1694 3 4 0 + 1695 2 13 0 + 1696 3 11 0 + 1697 3 0 0 + 1698 3 8 4 + 1699 3 4 0 + 1700 2 0 0 + 60) 153 1 8 + Average 2 11 0⅓ + + 1701 1 17 8 + 1702 1 9 6 + 1703 1 16 0 + 1704 2 6 6 + 1705 1 10 0 + 1706 1 6 0 + 1707 1 8 6 + 1708 2 1 6 + 1709 3 18 6 + 1710 3 18 0 + 1711 2 14 0 + 1712 2 6 4 + 1713 2 11 0 + 1714 2 10 4 + 1715 2 3 0 + 1716 2 8 0 + 1717 2 5 8 + 1718 1 18 10 + 1719 1 15 0 + 1720 1 17 0 + 1721 1 17 6 + 1722 1 16 0 + 1723 1 14 8 + 1724 1 17 0 + 1725 2 8 6 + 1726 2 6 0 + 1727 2 2 0 + 1728 2 14 6 + 1729 2 6 10 + 1730 1 16 6 + 1731 1 12 10 1 12 10 + 1732 1 6 8 1 6 8 + 1733 1 8 4 1 8 4 + 1734 1 18 10 1 18 10 + 1735 2 3 0 2 3 0 + 1736 2 0 4 2 0 4 + 1737 1 18 0 1 18 0 + 1738 1 15 6 1 15 6 + 1739 1 18 6 1 18 6 + 1740 2 10 8 2 10 8 + 10) 18 12 8 + 1 17 3½ + + 1741 2 6 8 2 6 8 + 1742 1 14 0 1 14 0 + 1743 1 4 10 1 4 10 + 1744 1 4 10 1 4 10 + 1745 1 7 6 1 7 6 + 1746 1 19 0 1 19 0 + 1747 1 14 10 1 14 10 + 1748 1 17 0 1 17 0 + 1749 1 17 0 1 17 0 + 1750 1 12 6 1 12 6 + 10) 16 18 2 + 1 13 9¾ + + 1751 1 18 6 + 1752 2 1 10 + 1753 2 4 8 + 1754 1 13 8 + 1755 1 14 10 + 1756 2 5 3 + 1757 3 0 0 + 1758 2 10 0 + 1759 1 19 10 + 1760 1 16 6 + 1761 1 10 3 + 1762 1 19 0 + 1763 2 0 9 + 1764 2 6 9 + 64) 129 13 6 + Average 2 0 6¾ + + +## Extraction Guidelines + +--- +id: extraction-rules +name: extraction_rules +artifact_type: content +description: Guidelines for extracting economic entities from source text +version: 1.0.0 +--- + +# Entity Extraction Rules + +## What Constitutes an Entity + +An economic entity is a distinct concept, actor, mechanism, or institution +that plays a functional role in Adam Smith's economic analysis. Extract +entities at the level of specificity where they carry independent meaning. + +## Extraction Criteria + +1. **Concepts**: Abstract economic ideas (e.g., "division of labour", + "effectual demand", "natural price"). Extract when Smith defines, + explains, or argues about the concept. + +2. **Actors**: Economic agents with defined roles (e.g., "the labourer", + "the merchant", "the sovereign"). Extract when the actor performs + a distinct economic function. + +3. **Mechanisms**: Processes or dynamics that produce economic effects + (e.g., "accumulation of stock", "market price adjustment", + "foreign trade"). Extract when the mechanism is described as + producing specific outcomes. + +4. **Institutions**: Organised structures that shape economic behaviour + (e.g., "the corporation", "the guild", "the joint-stock company"). + Extract when the institution's economic function is described. + +## Granularity Rules + +- Extract at the level of a single coherent concept. +- Do NOT extract synonyms as separate entities — choose the primary term + Smith uses and note variations. +- DO extract distinct aspects of a broad concept as separate entities when + Smith treats them independently (e.g., "wages of labour" and "profits + of stock" are separate from "price of commodities" even though they + compose it). +- If an entity appears across multiple chapters, extract it on first + significant appearance and note cross-references in later chapters. + +## Naming Conventions + +- Use Smith's own terminology where possible. +- Normalise to lowercase except for proper nouns. +- Use the most common form Smith uses (e.g., "division of labour" not + "divided labour"). + +## Quality Checks + +- Each entity must have a definition that would be comprehensible without + reading the source chapter. +- Each entity must cite the specific book and chapter of first appearance. +- **Economic Domain** must be EXACTLY ONE of: Production, Distribution, + Exchange, Consumption, Accumulation, Regulation, or General Theory. + Do not combine multiple domains. Do not use any other value. +- **Source Chapter format**: Use `Book [Roman numeral], Chapter [number]` + — for example `Book I, Chapter 3`. Do not include the chapter title, + quotation marks, markdown formatting, or asterisks. Use Roman numerals + for the book (I, II, III, IV, V). + + +## VSM Framework Context + +Use the following VSM framework as context to guide your extraction. +Prioritize entities that are likely to have clear mappings to VSM concepts, +but do not exclude entities simply because they lack an obvious mapping. + +--- +id: vsm-framework +name: vsm_framework +artifact_type: content +description: Stafford Beer's Viable System Model reference for economic analysis +version: 1.0.0 +--- + +# Stafford Beer's Viable System Model (VSM) + +The Viable System Model (VSM) is a model of the organisational structure of any +autonomous system capable of producing itself. It was created by management +cybernetician Stafford Beer in his books *Brain of the Firm* (1972) and +*The Heart of Enterprise* (1979). + +## Core Principle: Viability + +A viable system is any system organised in such a way as to meet the demands +of surviving in a changing environment. One of the prime features of systems +that survive is that they are adaptable. The VSM expresses a model for a +viable system, which is an abstracted cybernetic description applicable to +any organisation that is a going concern. + +## The Five Systems + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the +operational units that directly create value. Each operational element is itself +a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, +individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, +direct engagement with the environment. + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in +System 1 to communicate with each other and that allow System 3 to monitor +and coordinate activities. System 2 dampens oscillations and resolves +conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard +weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict +resolution, standardisation. + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, +and responsibilities of System 1 and provide an interface between Systems 1 +and Systems 4/5. System 3 represents the day-to-day control of the +organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour +laws, enforcement of contracts, the "invisible hand" as emergent internal +regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, +synergy extraction, performance management. + +### System 3* (S3*) — Audit / Monitoring + +The audit and monitoring channel that allows System 3 to verify information +coming from System 1 through channels other than those provided by System 2. +System 3* provides sporadic, direct access to operational reality. + +**In economic terms:** Market inspections, quality checks, auditing of accounts, +surprise investigations into trade practices, verification of weights and measures. + +**Key properties:** Sporadic direct investigation, reality checking, bypassing +normal reporting channels. + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor +how the organisation needs to adapt to remain viable. System 4 captures +all relevant information about the outside-and-then environment. It is +responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, +market research, new technology adoption, colonial exploration and trade +route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic +planning, modelling, research and development. + +### System 5 (S5) — Policy / Identity + +The policy-making body that balances demands from Systems 3 and 4 and defines +the identity, values, and purpose of the organisation. System 5 provides +closure to the whole system and represents its supreme authority. + +**In economic terms:** Sovereign authority, constitutional principles governing +economic policy, national economic identity, the philosophical foundations +of economic systems (mercantilism vs. free trade), the overarching purpose +of the commonwealth. + +**Key properties:** Identity, ethos, supreme command, policy closure, +balancing internal and external perspectives. + +## Key Concepts + +### Recursion + +Every viable system contains and is contained in a viable system. The same +five-system structure recurs at every level of organisation. A workshop is +a viable system within a factory, which is a viable system within an +industry, which is a viable system within a national economy. + +### Variety + +A measure of the number of possible states of a system. The Law of Requisite +Variety (Ashby's Law) states that only variety can absorb variety. A +controller must have at least as much variety as the system it controls. + +### Requisite Variety + +The principle that for effective regulation, the variety of the regulator +must match the variety of the system being regulated. This is achieved +through variety attenuation (reducing the variety coming up from operations) +and variety amplification (increasing the variety of management's responses). + +### Attenuation and Amplification + +Variety engineering mechanisms. Attenuation reduces variety (e.g., reporting +summaries, statistical aggregation, standardisation). Amplification increases +variety (e.g., delegation, empowerment, decentralisation). + +### Algedonic Signals + +Emergency signals that bypass the normal management hierarchy to alert +higher systems of critical situations requiring immediate attention. Named +from the Greek words for pain (algos) and pleasure (hedone). + +**In economic terms:** Market panics, famine signals, sudden price collapses, +trade embargoes, economic crises that demand immediate sovereign intervention. + +### Autonomy + +The degree of freedom granted to operational units (System 1) to self-organise +within constraints set by System 3. Beer argued that maximum autonomy +consistent with systemic cohesion yields maximum viability. + +### Viability + +The capacity of a system to maintain a separate existence and survive in a +changing environment. A viable system continuously adapts while maintaining +its identity. + + +## Existing Entities + +The following entities have already been extracted from previous chapters +of this work. Do NOT re-extract any of these. If one of these entities +appears in the current chapter, you may omit it entirely — the infospace +already contains it. Only extract entities that are genuinely new. + +- accumulation-of-stock +- adulteration-of-metals +- adulterine-guilds +- advanced-state-of-society +- advancing-state-of-manufacture +- agricultural-labour +- annual-industry-employed-in-production +- apprenticeships +- artificial-market-creation +- artisan-specialisation +- assaying +- assize-of-bread +- aulnagers +- average-price-of-corn +- barbarous-nations-barrier +- barter-and-exchange +- benevolence +- bleacher +- butcher-trade +- canal-communication +- capital-employed +- certificates +- cheap-years +- coal-heaver +- coarser-and-finer-materials +- coined-money +- collier +- colony-prosperity +- combination-of-masters +- combination-of-workmen +- command-over-labour +- commercial-interactions +- commercial-society +- commercial-transactions +- common-annual-profits-of-manufacturing-stock +- common-labour-wages +- common-returns-of-stock +- competition-among-buyers +- competition-among-dealers +- competition-among-sellers +- complete-manufacture +- component-parts-of-price +- contract +- copper-money +- corn-rent +- corporation-laws +- corporation-privileges-and-market-prices +- dear-years +- debasement-of-currency +- declining-manufacture +- degradation-of-coin +- demand-for-labour +- division-of-labour +- double-coincidence-of-wants +- early-and-rude-state-of-society +- early-navigation-advantages +- economic-accessibility-determinants +- economic-accessibility-gradient +- economic-backwardness +- economic-connectivity-importance +- economic-development-constraints +- economic-development-geography +- economic-development-geography-theory +- economic-development-sequence +- economic-development-spatial-patterns +- economic-geography +- economic-geography-determinism +- economic-geography-impact +- economic-isolation-effects +- economic-opportunity-cost +- economic-opportunity-geography +- economic-prosperity-symptoms +- economic-spatial-inequality +- economic-spatial-organisation +- economic-stagnation-symptoms +- effectual-demand +- exchange +- exchangeable-value +- exchequer +- exclusive-corporation +- extraordinary-profits +- farmer +- favour +- flax-grower +- fluctuations-in-value-of-gold-and-silver +- foreign-trade +- frozen-ocean-barrier +- funds-for-maintaining-labour +- gold-money +- higgling-and-bargaining-of-the-market +- human-nature +- idle-consumers +- inland-market-limitation +- inland-navigation-extent +- inland-parts-of-the-country +- inland-trade +- inn-or-tavern-keeper +- instruments-of-husbandry +- interest +- interest-of-money +- interest-or-use-of-money +- journeymen +- judgment-in-labour-application +- labour-of-inspection-and-direction +- labouring-cattle +- labouring-poor +- land-carriage +- landlord +- legal-rate-of-interest +- legal-tender +- licence-to-gather-natural-produce +- lowest-rate-of-wages +- machinery-invention +- manufacturer +- maritime-commerce-development +- maritime-employment +- market-access-cost-structure +- market-access-development-sequence +- market-access-economic-potential +- market-access-gradient +- market-access-inequality +- market-access-opportunity-cost +- market-based-economic-geography +- market-based-economic-identity +- market-based-economic-structure +- market-based-productivity-limits +- market-based-specialisation +- market-communication-channels +- market-development-prerequisites +- market-driven-division +- market-extent +- market-extent-economic-impact +- market-extent-measurement +- market-integration-barriers +- market-integration-potential +- market-integration-timeline +- market-obstruction +- market-price-adjustment +- market-price-of-bullion +- market-price-of-commodities +- market-rate-of-interest +- market-regulation-of-prices +- market-separation +- market-size-economies +- market-size-specialisation-threshold +- market-size-threshold +- market-town-economy +- master-manufacturer +- materials-and-subsistence +- measure-of-exchangeable-value +- mediterranean-civilisation-pattern +- menial-servants +- merchant +- metal-currency +- military-employment +- mint +- mint-price +- money +- money-rent +- monopoly-effects-on-market-price +- mutual-good-offices +- natural-complement-of-riches +- natural-market-advantages +- natural-price-as-central-price +- natural-price-of-commodities +- natural-produce-of-land +- natural-rates-of-wages-profit-and-rent +- natural-state-of-employments +- navigable-rivers +- necessity +- nominal-measure-of-value +- nominal-price-of-commodities +- non-standard-metal +- occasional-and-temporary-market-fluctuations +- ordinary-rates-of-wages-profit-and-rent +- ordinary-state-of-employments +- overstocked-market-conditions +- payment-in-kind +- perfect-liberty-in-trade +- permanent-market-price-enhancements +- piece-work-wages +- pin-maker-trade +- poacher +- price-in-labour +- price-in-money +- price-of-commodities +- prime-cost-of-commodities +- principal-clerk +- principal-employments +- productive-powers-of-labour +- profits-of-stock +- progressive-state-of-society +- proportion-between-metals +- public-education-of-professionals +- public-executioner +- public-law-on-coinage +- public-lottery +- public-mourning-effects +- public-registers-of-manufactures +- quantity-of-labour +- rate-of-profit +- real-measure-of-value +- real-price-of-commodities +- real-value-of-corn-rent +- regulated-proportion +- religious-occupational-restrictions +- rent-of-land +- retail-trade +- river-navigation-infrastructure +- scarcity-of-hands +- sea-coast-development +- seignorage +- self-love +- settlement-laws +- silver-money +- skill-and-dexterity +- smuggling-trade +- species-of-industry-with-consistent-output +- species-of-industry-with-variable-output +- speculative-trade +- stamp-masters +- standard-metal +- standard-weight-of-coin +- stationary-country +- statutes-of-apprenticeship-effects +- sterling-mark +- stock-of-the-country +- stock-of-the-farmer +- subsistence +- subsistence-agriculture +- subsistence-of-the-dealer +- superfluity +- superior-hardship-and-superior-skill +- tale +- temporary-price-of-corn +- three-original-sources-of-revenue +- thriving-country +- toil-and-trouble-of-acquiring +- trade-encouragement +- trade-route-dependency +- transportation-cost-differential +- transportation-infrastructure-importance +- transportation-mode-economic-effects +- treaty +- truck +- university-of-trades +- unstamped-bars +- value-in-exchange +- value-in-use +- value-of-gold +- value-of-silver +- variety-of-talents +- venison +- victuals +- wages-of-a-journeyman +- wages-of-labour +- water-carriage +- weighing +- whole-produce-of-labour +- wholesale-trade +- wool-grower + +## Instructions + +1. Read the source chapter carefully. +2. Review the list of existing entities above and do not duplicate them. +3. Identify all distinct economic concepts, actors, mechanisms, and institutions + that are NOT already in the existing entities list. +4. For each new entity, produce a separate markdown document following the + Economic Entity Schema v1.0. +5. Each entity document must include: + - An H1 heading with the entity name + - A Definition section (20-150 words) + - A Source Chapter section citing the specific chapter + - A Context section describing where in the argument the entity appears + - An Economic Domain section classifying the entity +6. Optionally include Smith's Original Wording (direct quote) and + Modern Interpretation sections. +7. Use neutral, analytical language throughout. +8. Ensure each entity is distinct and self-contained. + +## Output Format + +Output each entity as a separate markdown document, delimited by +`--- ENTITY: ---` markers. + +Use **H2 headings** (`##`) for each section inside the entity document. +Do NOT use inline `Section:` format or H3 headings. + +Example of a correctly formatted entity: + +``` +--- ENTITY: division of labour --- + +# Division of Labour + +## Definition + +The separation of a work process into distinct tasks performed by specialised +workers, increasing productivity through greater dexterity, saved time, and +the invention of labour-saving machinery. + +## Source Chapter + +Book I, Chapter 1 + +## Context + +The opening chapter's central argument, illustrated by Smith's pin factory +example showing how dividing 18 operations dramatically increases output. + +## Economic Domain + +Production + +--- +``` diff --git a/examples/infospace-with-history/output/entities/coal-price.md b/examples/infospace-with-history/output/entities/coal-price.md new file mode 100644 index 00000000..d1593bbf --- /dev/null +++ b/examples/infospace-with-history/output/entities/coal-price.md @@ -0,0 +1,21 @@ + + +# Coal Price + +## Definition + +The market price of coal, which is influenced by its abundance, transportation costs, and the availability of alternative fuels. Coal prices tend to be lower in coal-producing regions and higher in areas dependent on imported coal. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes coal prices as an example of how the rent component in commodity prices varies with the natural abundance of resources, arguing that coal rents are typically lower than rents for agricultural land due to the greater abundance of coal mines. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/conversion-price.md b/examples/infospace-with-history/output/entities/conversion-price.md new file mode 100644 index 00000000..fb575551 --- /dev/null +++ b/examples/infospace-with-history/output/entities/conversion-price.md @@ -0,0 +1,21 @@ + + +# Conversion Price + +## Definition + +The price at which agricultural produce, particularly grain, could be converted from payment in kind to payment in money under Scottish agricultural tenancy agreements. This price was typically set below market rates to protect tenants from excessive charges. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses conversion prices as an example of how agricultural rents were historically structured and how they affected the relationship between landlords and tenants in Scotland. + +## Economic Domain + +Distribution + +--- diff --git a/examples/infospace-with-history/output/entities/corn-land.md b/examples/infospace-with-history/output/entities/corn-land.md new file mode 100644 index 00000000..a57f995a --- /dev/null +++ b/examples/infospace-with-history/output/entities/corn-land.md @@ -0,0 +1,21 @@ + + +# Corn Land + +## Definition + +Land used for growing grain crops, particularly wheat and other cereals. The rent of corn land is determined by its productivity in grain production and the market price of grain. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how corn land serves as the baseline for determining rents of other types of land, as grain production is the most fundamental agricultural activity and provides the subsistence for most of the population. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/exportation-bounty.md b/examples/infospace-with-history/output/entities/exportation-bounty.md new file mode 100644 index 00000000..2de1ace2 --- /dev/null +++ b/examples/infospace-with-history/output/entities/exportation-bounty.md @@ -0,0 +1,21 @@ + + +# Exportation Bounty + +## Definition + +A government subsidy paid to encourage the export of grain, particularly wheat. The bounty was designed to support agricultural prices and encourage production by making exports more profitable. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the bounty on grain exports affected domestic grain prices and agricultural production, arguing that it raised prices in the home market and may have discouraged rather than encouraged tillage in the long run. + +## Economic Domain + +Regulation + +--- diff --git a/examples/infospace-with-history/output/entities/farmers-profit.md b/examples/infospace-with-history/output/entities/farmers-profit.md new file mode 100644 index 00000000..cf7f03f7 --- /dev/null +++ b/examples/infospace-with-history/output/entities/farmers-profit.md @@ -0,0 +1,21 @@ + + +# Farmer's Profit + +## Definition + +The return to the agricultural entrepreneur for the use of capital and management in farming operations. This profit must be sufficient to compensate for the risk and effort involved in cultivation and to provide a return comparable to other forms of investment. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how farmers' profits are determined by the productivity of the land and the efficiency of cultivation, and how these profits must be sufficient to maintain and improve the stock employed in agriculture. + +## Economic Domain + +Distribution + +--- diff --git a/examples/infospace-with-history/output/entities/fruit-garden.md b/examples/infospace-with-history/output/entities/fruit-garden.md new file mode 100644 index 00000000..47cfb260 --- /dev/null +++ b/examples/infospace-with-history/output/entities/fruit-garden.md @@ -0,0 +1,21 @@ + + +# Fruit Garden + +## Definition + +Land used for growing fruit trees and bushes. Fruit gardens represent a long-term investment in agriculture that can command premium rents due to the high value of fruit relative to the land required for its production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses fruit gardens as another example of specialized agricultural production that can justify higher rents due to the value of the produce and the care required for successful cultivation. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/fruit-wall.md b/examples/infospace-with-history/output/entities/fruit-wall.md new file mode 100644 index 00000000..919795de --- /dev/null +++ b/examples/infospace-with-history/output/entities/fruit-wall.md @@ -0,0 +1,21 @@ + + +# Fruit-Wall + +## Definition + +A wall constructed around a kitchen garden or orchard to protect fruit trees from wind and to create a warmer microclimate that extends the growing season. The cost of building and maintaining fruit-walls is justified by the higher value of the protected fruit production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses fruit-walls as an example of agricultural improvements that increase the value of land by enabling the production of higher-value crops that would not otherwise be viable in the local climate. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/gold-price-variation.md b/examples/infospace-with-history/output/entities/gold-price-variation.md new file mode 100644 index 00000000..a2815091 --- /dev/null +++ b/examples/infospace-with-history/output/entities/gold-price-variation.md @@ -0,0 +1,21 @@ + + +# Gold Price Variation + +## Definition + +The changes over time in the value of gold relative to silver and other commodities. These variations are influenced by the relative abundance of gold and silver mines and the different uses to which the metals are put. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the relative values of gold and silver have changed over time, particularly after the discovery of American mines, and how this affects their use in different economic functions. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/hop-garden.md b/examples/infospace-with-history/output/entities/hop-garden.md new file mode 100644 index 00000000..8b6fbfbd --- /dev/null +++ b/examples/infospace-with-history/output/entities/hop-garden.md @@ -0,0 +1,21 @@ + + +# Hop Garden + +## Definition + +Land specifically cultivated for growing hops, used primarily in beer production. Hop gardens represent a specialized form of agriculture that can command higher rents due to the value of the crop and the intensive cultivation required. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses hop gardens as an example of specialized agricultural production that requires more investment and care than general field crops, and therefore can command higher rents and profits. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/improved-land.md b/examples/infospace-with-history/output/entities/improved-land.md new file mode 100644 index 00000000..70eecef7 --- /dev/null +++ b/examples/infospace-with-history/output/entities/improved-land.md @@ -0,0 +1,21 @@ + + +# Improved Land + +## Definition + +Land that has been enhanced through human investment in cultivation, drainage, fencing, clearing, or other modifications that increase its productive capacity beyond its natural state. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements to land affect its productive capacity and, consequently, the rent it can command. Improved land typically generates higher rents due to its increased productivity. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/inclosure.md b/examples/infospace-with-history/output/entities/inclosure.md new file mode 100644 index 00000000..ec70bcef --- /dev/null +++ b/examples/infospace-with-history/output/entities/inclosure.md @@ -0,0 +1,21 @@ + + +# Inclosure + +## Definition + +The practice of surrounding land with fences, hedges, or walls to create defined agricultural units. Inclosure increases the productivity of land by enabling better control of livestock, more intensive cultivation, and protection of crops from damage. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how inclosure affects land rents and agricultural productivity, arguing that it is particularly beneficial for pasture land and that the high rents currently commanded by inclosed land in Scotland are due to temporary scarcity rather than permanent advantage. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/kelp.md b/examples/infospace-with-history/output/entities/kelp.md new file mode 100644 index 00000000..2a34e54b --- /dev/null +++ b/examples/infospace-with-history/output/entities/kelp.md @@ -0,0 +1,21 @@ + + +# Kelp + +## Definition + +A type of seaweed that, when burned, produces an alkaline salt used in glassmaking, soap production, and other industrial processes. Kelp grows on rocky shores within the high-water mark and can be harvested without cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses kelp as an example of a natural product that can command rent even though it requires no human improvement, demonstrating that rent is not solely a function of agricultural improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/kitchen-garden.md b/examples/infospace-with-history/output/entities/kitchen-garden.md new file mode 100644 index 00000000..9d5de282 --- /dev/null +++ b/examples/infospace-with-history/output/entities/kitchen-garden.md @@ -0,0 +1,21 @@ + + +# Kitchen Garden + +## Definition + +Land used for growing vegetables and herbs for household consumption. Kitchen gardens require intensive cultivation and can command higher rents per unit area than field crops due to their high value relative to the land they occupy. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses kitchen gardens as an example of high-value agricultural production that can justify intensive cultivation and higher rents, particularly when located near urban markets where fresh produce commands premium prices. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/landlords-share.md b/examples/infospace-with-history/output/entities/landlords-share.md new file mode 100644 index 00000000..bba1798a --- /dev/null +++ b/examples/infospace-with-history/output/entities/landlords-share.md @@ -0,0 +1,21 @@ + + +# Landlord's Share + +## Definition + +The portion of the total produce from land that goes to the landlord as rent, distinct from the portions that go to the farmer as profit and to laborers as wages. The landlord's share increases with the productivity of the land and the efficiency of cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the landlord's share of agricultural produce is determined by the surplus value created by the land after all necessary costs of production have been met, and how this share varies with different types of land and agricultural practices. + +## Economic Domain + +Distribution + +--- diff --git a/examples/infospace-with-history/output/entities/mine-fertility.md b/examples/infospace-with-history/output/entities/mine-fertility.md new file mode 100644 index 00000000..a9d6ec99 --- /dev/null +++ b/examples/infospace-with-history/output/entities/mine-fertility.md @@ -0,0 +1,21 @@ + + +# Mine Fertility + +## Definition + +The productivity of a mineral mine in terms of the quantity of valuable material that can be extracted per unit of labor and capital invested. Mine fertility varies significantly between different mines and affects the price and rent of the extracted minerals. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses the concept of mine fertility to explain why the rent component in mineral prices is typically lower than in agricultural products, as mineral deposits are generally more abundant and less geographically concentrated than fertile agricultural land. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/mine-situation.md b/examples/infospace-with-history/output/entities/mine-situation.md new file mode 100644 index 00000000..68ab73d2 --- /dev/null +++ b/examples/infospace-with-history/output/entities/mine-situation.md @@ -0,0 +1,21 @@ + + +# Mine Situation + +## Definition + +The geographical location of a mineral mine and its accessibility to markets and transportation infrastructure. Mine situation can significantly affect the cost of production and the price that can be obtained for the extracted minerals. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that for mineral extraction, the situation of the mine is often more important than its fertility in determining profitability, as transportation costs can significantly affect the competitiveness of mineral products in distant markets. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/monopoly-price-of-land.md b/examples/infospace-with-history/output/entities/monopoly-price-of-land.md new file mode 100644 index 00000000..cdb35213 --- /dev/null +++ b/examples/infospace-with-history/output/entities/monopoly-price-of-land.md @@ -0,0 +1,21 @@ + + +# Monopoly Price of Land + +## Definition + +The price paid for the use of land that exceeds what would be paid under competitive conditions, arising from the landlord's exclusive control over a particular piece of land. This price is determined by what the tenant can afford to pay rather than by the cost of providing the land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is essentially a monopoly price because it is not determined by the cost of providing the land but by what the tenant can afford to pay based on the land's productive capacity. This concept is crucial for understanding how rent differs from other forms of economic returns. + +## Economic Domain + +Distribution + +--- diff --git a/examples/infospace-with-history/output/entities/natural-rent-of-land.md b/examples/infospace-with-history/output/entities/natural-rent-of-land.md new file mode 100644 index 00000000..1b0d85e7 --- /dev/null +++ b/examples/infospace-with-history/output/entities/natural-rent-of-land.md @@ -0,0 +1,21 @@ + + +# Natural Rent of Land + +## Definition + +The ordinary or typical rent that land commands in the market, determined by the surplus value that can be extracted from the land after maintaining the stock required for cultivation and providing ordinary profits to the farmer. This represents the price that land would naturally command in the absence of special circumstances or market distortions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith distinguishes between the natural rent that land would command under ordinary market conditions and the actual rent that may result from various circumstances. This concept helps explain the baseline against which other rent variations can be measured. + +## Economic Domain + +Distribution + +--- diff --git a/examples/infospace-with-history/output/entities/pasture-land.md b/examples/infospace-with-history/output/entities/pasture-land.md new file mode 100644 index 00000000..1bbfbf52 --- /dev/null +++ b/examples/infospace-with-history/output/entities/pasture-land.md @@ -0,0 +1,21 @@ + + +# Pasture Land + +## Definition + +Land used primarily for grazing livestock, particularly cattle and sheep. The rent of pasture land is determined by its capacity to support animals and the market value of the livestock products it produces. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the rent of pasture land varies with its quality and location, and how it competes with corn land in the agricultural economy. He examines the factors that determine whether land is more profitably used for pasture or cultivation. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/potato-cultivation.md b/examples/infospace-with-history/output/entities/potato-cultivation.md new file mode 100644 index 00000000..871a59c2 --- /dev/null +++ b/examples/infospace-with-history/output/entities/potato-cultivation.md @@ -0,0 +1,21 @@ + + +# Potato Cultivation + +## Definition + +The agricultural practice of growing potatoes as a staple food crop. Potato cultivation can support higher population densities and potentially higher rents than grain cultivation due to its higher productivity per acre and nutritional value. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses potato cultivation as a potentially revolutionary agricultural practice that could support larger populations and higher rents than traditional grain cultivation, though he notes the practical difficulties of storage and preservation. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/precious-metals-consumption.md b/examples/infospace-with-history/output/entities/precious-metals-consumption.md new file mode 100644 index 00000000..10b4d13f --- /dev/null +++ b/examples/infospace-with-history/output/entities/precious-metals-consumption.md @@ -0,0 +1,21 @@ + + +# Precious Metals Consumption + +## Definition + +The use of gold and silver in various forms including coin, plate, jewelry, and industrial applications. This consumption creates ongoing demand for newly mined precious metals to replace losses from wear, damage, and industrial use. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the consumption of precious metals in various forms creates a continuous demand that must be met by new production, affecting their long-term value and availability. + +## Economic Domain + +Consumption + +--- diff --git a/examples/infospace-with-history/output/entities/public-fiars.md b/examples/infospace-with-history/output/entities/public-fiars.md new file mode 100644 index 00000000..26f92d05 --- /dev/null +++ b/examples/infospace-with-history/output/entities/public-fiars.md @@ -0,0 +1,21 @@ + + +# Public Fiars + +## Definition + +Official annual valuations of grain prices conducted by assize courts in Scotland to establish fair prices for various grains and qualities. These valuations provided a standardized basis for converting corn rents to money rents and for other legal and commercial purposes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith mentions public fiars as an example of how governments have attempted to regulate grain prices and provide stability in agricultural markets, though he generally favors market-determined prices over official valuations. + +## Economic Domain + +Regulation + +--- diff --git a/examples/infospace-with-history/output/entities/rice-countries.md b/examples/infospace-with-history/output/entities/rice-countries.md new file mode 100644 index 00000000..03e5ebaf --- /dev/null +++ b/examples/infospace-with-history/output/entities/rice-countries.md @@ -0,0 +1,21 @@ + + +# Rice Countries + +## Definition + +Regions where rice is the primary agricultural product and staple food, such as parts of Asia and the American South. Rice cultivation typically requires specific environmental conditions and intensive labor, leading to different economic dynamics than wheat-producing regions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses rice countries to illustrate how the nature of the primary agricultural product affects the distribution of economic returns, particularly how rice cultivation can support higher rents due to its high productivity per acre. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/silver-price-variation.md b/examples/infospace-with-history/output/entities/silver-price-variation.md new file mode 100644 index 00000000..f0c2db3d --- /dev/null +++ b/examples/infospace-with-history/output/entities/silver-price-variation.md @@ -0,0 +1,21 @@ + + +# Silver Price Variation + +## Definition + +The changes over time in the value of silver relative to other commodities, particularly corn. These variations reflect changes in the supply of silver from mines and changes in the demand for silver as commerce and wealth increase. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith provides a detailed analysis of how the value of silver has changed relative to corn over the past four centuries, using this as evidence for his theories about the relationship between wealth, commerce, and the value of precious metals. + +## Economic Domain + +Exchange + +--- diff --git a/examples/infospace-with-history/output/entities/statute-of-labourers.md b/examples/infospace-with-history/output/entities/statute-of-labourers.md new file mode 100644 index 00000000..ae079374 --- /dev/null +++ b/examples/infospace-with-history/output/entities/statute-of-labourers.md @@ -0,0 +1,21 @@ + + +# Statute of Labourers + +## Definition + +The English law enacted in 1351 during the reign of Edward III that attempted to regulate wages and prices following the labor shortages caused by the Black Death. The statute set maximum wages and prices for various goods and services. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith references the Statute of Labourers as historical evidence of grain prices in the 14th century, using it to trace the changes in the value of silver relative to corn over time. + +## Economic Domain + +Regulation + +--- diff --git a/examples/infospace-with-history/output/entities/sugar-colonies.md b/examples/infospace-with-history/output/entities/sugar-colonies.md new file mode 100644 index 00000000..434d9ccd --- /dev/null +++ b/examples/infospace-with-history/output/entities/sugar-colonies.md @@ -0,0 +1,21 @@ + + +# Sugar Colonies + +## Definition + +Plantations in tropical regions, particularly in the West Indies, that produce sugar cane for export to European markets. These colonies represent a form of specialized agricultural production that commands exceptionally high profits and rents due to the high value of sugar and the limited geographical areas suitable for its cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses sugar colonies as an extreme example of land that can command rents far exceeding those of ordinary agricultural land, due to the combination of high-value production and limited suitable territory. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/tobacco-colonies.md b/examples/infospace-with-history/output/entities/tobacco-colonies.md new file mode 100644 index 00000000..d95f5dbf --- /dev/null +++ b/examples/infospace-with-history/output/entities/tobacco-colonies.md @@ -0,0 +1,21 @@ + + +# Tobacco Colonies + +## Definition + +Plantations in North America, particularly Virginia and Maryland, that produce tobacco for export to European markets. Tobacco cultivation represents a specialized form of agriculture that can command high rents due to the value of the crop and the limited suitable land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses tobacco colonies as another example of specialized agricultural production that can command rents exceeding those of ordinary agricultural land, though typically not as high as sugar colonies due to greater competition and more widely available suitable land. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/unimproved-land.md b/examples/infospace-with-history/output/entities/unimproved-land.md new file mode 100644 index 00000000..eb9b3a3a --- /dev/null +++ b/examples/infospace-with-history/output/entities/unimproved-land.md @@ -0,0 +1,21 @@ + + +# Unimproved Land + +## Definition + +Land that has not been enhanced through human investment in drainage, fencing, clearing, or other improvements that increase its productive capacity. Even unimproved land can command rent based on its natural productive qualities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses examples of unimproved land, such as kelp-producing shores and uncultivated pastures, to demonstrate that rent is not solely a function of human improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/vineyard.md b/examples/infospace-with-history/output/entities/vineyard.md new file mode 100644 index 00000000..b9ec8ffd --- /dev/null +++ b/examples/infospace-with-history/output/entities/vineyard.md @@ -0,0 +1,21 @@ + + +# Vineyard + +## Definition + +Land specifically cultivated for grape production to make wine. Vineyards often command premium rents due to the high value of wine and the limited geographical areas suitable for viticulture. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses vineyards as an example of land that can command exceptionally high rents due to the high value of its produce and the limited supply of suitable land. He discusses how vineyard rents are regulated by the profitability of corn production. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/entities/wood-price.md b/examples/infospace-with-history/output/entities/wood-price.md new file mode 100644 index 00000000..75e5c2f5 --- /dev/null +++ b/examples/infospace-with-history/output/entities/wood-price.md @@ -0,0 +1,21 @@ + + +# Wood Price + +## Definition + +The market price of timber and firewood, which varies with the state of agriculture and population density. As agriculture advances and reduces forest land, the price of wood typically rises due to increased scarcity. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the price of wood serves as an alternative fuel source to coal and how changes in wood prices affect the demand for coal and the rents of coal mines. + +## Economic Domain + +Production + +--- diff --git a/examples/infospace-with-history/output/mappings/book-1-chapter-11-map-to-vsm-raw.md b/examples/infospace-with-history/output/mappings/book-1-chapter-11-map-to-vsm-raw.md new file mode 100644 index 00000000..28c3ea14 --- /dev/null +++ b/examples/infospace-with-history/output/mappings/book-1-chapter-11-map-to-vsm-raw.md @@ -0,0 +1,1567 @@ +--- MAPPING: rent-of-land-to-S1 --- +# rent-of-land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: rent-of-land --- + +# Rent of Land + +## Definition + +The payment made by a tenant to a landlord for the use of land, representing the surplus value that the land generates beyond what is required to maintain the stock employed in cultivation and provide ordinary profits to the farmer. Rent is determined by what the tenant can afford to pay based on the productive capacity of the land, not by the landlord's investment in improvements. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +This is the central concept of the chapter, forming the foundation for Smith's analysis of how rent functions as a component of commodity prices and how it varies with different types of land and produce. The chapter systematically examines rent's nature, determinants, and relationship to other economic factors. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Rent of land represents the operational output of agricultural land as a productive unit. In Smith's analysis, land functions as an autonomous operational element that directly produces value through its natural productive capacity. The rent payment is the mechanism by which the surplus value created by this operational unit is distributed, making land itself the primary value-producing entity within the agricultural economy. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: rent-of-land-to-S3 --- +# rent-of-land -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: rent-of-land --- + +# Rent of Land + +## Definition + +The payment made by a tenant to a landlord for the use of land, representing the surplus value that the land generates beyond what is required to maintain the stock employed in cultivation and provide ordinary profits to the farmer. Rent is determined by what the tenant can afford to pay based on the productive capacity of the land, not by the landlord's investment in improvements. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +This is the central concept of the chapter, forming the foundation for Smith's analysis of how rent functions as a component of commodity prices and how it varies with different types of land and produce. The chapter systematically examines rent's nature, determinants, and relationship to other economic factors. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Rent of land functions as a regulatory mechanism that controls the allocation of agricultural resources within the economic system. It establishes the rules and rights governing land use, determines the distribution of surplus value, and creates incentives for optimal land management. The rent mechanism acts as an internal regulatory system that optimises the use of land resources across the economy. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: natural rent of land-to-S3 --- +# natural rent of land -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: natural rent of land --- + +# Natural Rent of Land + +## Definition + +The ordinary or typical rent that land commands in the market, determined by the surplus value that can be extracted from the land after maintaining the stock required for cultivation and providing ordinary profits to the farmer. This represents the price that land would naturally command in the absence of special circumstances or market distortions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith distinguishes between the natural rent that land would command under ordinary market conditions and the actual rent that may result from various circumstances. This concept helps explain the baseline against which other rent variations can be measured. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Natural rent of land serves as the baseline regulatory framework for land resource allocation in the economic system. It represents the standard control mechanism that would operate in the absence of market distortions, providing a reference point for optimal resource distribution. This concept functions as the internal regulatory standard against which actual market conditions are measured and managed. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: monopoly price of land-to-S3 --- +# monopoly price of land -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: monopoly price of land --- + +# Monopoly Price of Land + +## Definition + +The price paid for the use of land that exceeds what would be paid under competitive conditions, arising from the landlord's exclusive control over a particular piece of land. This price is determined by what the tenant can afford to pay rather than by the cost of providing the land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is essentially a monopoly price because it is not determined by the cost of providing the land but by what the tenant can afford to pay based on the land's productive capacity. This concept is crucial for understanding how rent differs from other forms of economic returns. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Monopoly price of land represents a distortion in the internal regulatory mechanism of the economic system. It shows how exclusive control over resources can create regulatory failures where the standard control mechanisms (natural rent) are overridden by monopolistic power. This concept highlights the need for higher-level regulatory intervention to correct market failures and restore optimal resource allocation. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: corn rent-to-S1 --- +# corn rent -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: corn rent --- + +# Corn Rent + +## Definition + +Rent paid in the form of a portion of the agricultural produce, particularly grain, rather than in money. This form of rent directly ties the landlord's income to the productivity of the land and the success of the harvest. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how rent can be paid either in kind (corn rent) or in money, and how this distinction affects the relationship between landlords and tenants. Corn rent provides a more direct connection between land productivity and landlord income. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Corn rent represents the direct operational output of agricultural land as a productive unit. It embodies the principle that land as an operational element produces tangible value that can be directly distributed as rent. This form of rent maintains the connection between the operational productivity of land and the economic returns it generates, functioning as a pure expression of land's productive capacity. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: money rent-to-S2 --- +# money rent -> S2 (Coordination) + +## Economic Entity Reference + +--- ENTITY: money rent --- + +# Money Rent + +## Definition + +Rent paid in monetary form rather than in agricultural produce. This represents the market value of the land's productive capacity expressed in currency terms. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the transition from corn rent to money rent affects the relationship between landlords and tenants, and how money rent provides a more flexible and standardized form of payment that can better reflect market conditions. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in System 1 to communicate with each other and that allow System 3 to monitor and coordinate activities. System 2 dampens oscillations and resolves conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict resolution, standardisation. + +--- + +## Mapping Rationale + +Money rent functions as a coordination mechanism that standardizes the value of land across different agricultural operations and regions. By expressing rent in monetary terms, it creates a common language for comparing and coordinating land values, dampening the oscillations that would occur if rents were paid in kind. This standardization enables more efficient resource allocation and market coordination. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: unimproved land-to-S1 --- +# unimproved land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: unimproved land --- + +# Unimproved Land + +## Definition + +Land that has not been enhanced through human investment in drainage, fencing, clearing, or other improvements that increase its productive capacity. Even unimproved land can command rent based on its natural productive qualities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses examples of unimproved land, such as kelp-producing shores and uncultivated pastures, to demonstrate that rent is not solely a function of human improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Unimproved land represents an autonomous operational unit that produces value through its natural productive capacity without human intervention. It demonstrates that operational value creation can occur through natural processes rather than just through human-directed activities. This concept shows how operational units in the economic system can function based on inherent properties rather than constructed improvements. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: improved land-to-S1 --- +# improved land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: improved land --- + +# Improved Land + +## Definition + +Land that has been enhanced through human investment in cultivation, drainage, fencing, clearing, or other modifications that increase its productive capacity beyond its natural state. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements to land affect its productive capacity and, consequently, the rent it can command. Improved land typically generates higher rents due to its increased productivity. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Improved land represents an enhanced operational unit whose productivity has been increased through human intervention. It demonstrates how operational units can be optimized through investment and modification to produce greater value. The improvements function as operational enhancements that increase the unit's capacity to create surplus value, which is then reflected in higher rents. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: pasture land-to-S1 --- +# pasture land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: pasture land --- + +# Pasture Land + +## Definition + +Land used primarily for grazing livestock, particularly cattle and sheep. The rent of pasture land is determined by its capacity to support animals and the market value of the livestock products it produces. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the rent of pasture land varies with its quality and location, and how it competes with corn land in the agricultural economy. He examines the factors that determine whether land is more profitably used for pasture or cultivation. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Pasture land functions as an autonomous operational unit that produces value through livestock grazing operations. It represents a specialized form of agricultural production that directly creates economic output through natural biological processes. The rent mechanism coordinates the allocation of this operational resource based on its productive capacity and market conditions. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: corn land-to-S1 --- +# corn land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: corn land --- + +# Corn Land + +## Definition + +Land used for growing grain crops, particularly wheat and other cereals. The rent of corn land is determined by its productivity in grain production and the market price of grain. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how corn land serves as the baseline for determining rents of other types of land, as grain production is the most fundamental agricultural activity and provides the subsistence for most of the population. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Corn land represents the fundamental operational unit of agricultural production, serving as the baseline reference for all other agricultural operations. Its productivity directly determines the subsistence capacity of the economy and provides the foundation for all other economic activities. The rent mechanism for corn land establishes the standard by which all other land rents are measured and coordinated. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: vineyard-to-S1 --- +# vineyard -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: vineyard --- + +# Vineyard + +## Definition + +Land specifically cultivated for grape production to make wine. Vineyards often command premium rents due to the high value of wine and the limited geographical areas suitable for viticulture. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses vineyards as an example of land that can command exceptionally high rents due to the high value of its produce and the limited supply of suitable land. He discusses how vineyard rents are regulated by the profitability of corn production. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Vineyard represents a specialized operational unit that produces high-value output through specific agricultural processes. Its autonomous operation creates premium value that exceeds standard agricultural production, demonstrating how specialized operational units can command higher returns based on their unique productive characteristics and market position. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: kitchen garden-to-S1 --- +# kitchen garden -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: kitchen garden --- + +# Kitchen Garden + +## Definition + +Land used for growing vegetables and herbs for household consumption. Kitchen gardens require intensive cultivation and can command higher rents per unit area than field crops due to their high value relative to the land they occupy. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses kitchen gardens as an example of high-value agricultural production that can justify intensive cultivation and higher rents, particularly when located near urban markets where fresh produce commands premium prices. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Kitchen garden functions as an intensive operational unit that maximizes value production per unit of land through specialized cultivation techniques. It demonstrates how operational units can optimize their productive capacity through focused specialization and proximity to high-value markets, creating premium returns that justify higher resource allocation. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: hop garden-to-S1 --- +# hop garden -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: hop garden --- + +# Hop Garden + +## Definition + +Land specifically cultivated for growing hops, used primarily in beer production. Hop gardens represent a specialized form of agriculture that can command higher rents due to the value of the crop and the intensive cultivation required. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses hop gardens as an example of specialized agricultural production that requires more investment and care than general field crops, and therefore can command higher rents and profits. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Hop garden represents a specialized operational unit focused on producing a specific high-value input for another industry. It demonstrates how operational units can create premium value through specialization and intensive cultivation, with the rent mechanism coordinating the allocation of land resources to their most productive specialized uses. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: fruit garden-to-S1 --- +# fruit garden -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: fruit garden --- + +# Fruit Garden + +## Definition + +Land used for growing fruit trees and bushes. Fruit gardens represent a long-term investment in agriculture that can command premium rents due to the high value of fruit relative to the land required for its production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses fruit gardens as another example of specialized agricultural production that can justify higher rents due to the value of the produce and the care required for successful cultivation. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Fruit garden functions as a long-term operational unit that produces high-value output through specialized cultivation requiring significant investment and care. It demonstrates how operational units can create premium value through patient capital investment and specialized knowledge, with the rent mechanism coordinating the allocation of resources to these high-value specialized operations. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: fruit-wall-to-S1 --- +# fruit-wall -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: fruit-wall --- + +# Fruit-Wall + +## Definition + +A wall constructed around a kitchen garden or orchard to protect fruit trees from wind and to create a warmer microclimate that extends the growing season. The cost of building and maintaining fruit-walls is justified by the higher value of the protected fruit production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses fruit-walls as an example of agricultural improvements that increase the value of land by enabling the production of higher-value crops that would not otherwise be viable in the local climate. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Fruit-wall represents an operational enhancement that increases the productive capacity of agricultural units by modifying their environmental conditions. It demonstrates how operational units can be optimized through infrastructure investment to produce higher-value outputs, with the rent mechanism coordinating the allocation of resources to these productivity-enhancing improvements. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: sugar colonies-to-S1 --- +# sugar colonies -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: sugar colonies --- + +# Sugar Colonies + +## Definition + +Plantations in tropical regions, particularly in the West Indies, that produce sugar cane for export to European markets. These colonies represent a form of specialized agricultural production that commands exceptionally high profits and rents due to the high value of sugar and the limited geographical areas suitable for its cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses sugar colonies as an extreme example of land that can command rents far exceeding those of ordinary agricultural land, due to the combination of high-value production and limited suitable territory. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Sugar colonies function as highly specialized operational units that produce exceptional value through unique geographical advantages and specialized cultivation. They demonstrate how operational units in specific locations can create premium value through natural advantages combined with intensive production methods, with the rent mechanism coordinating the allocation of these scarce high-value resources. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: tobacco colonies-to-S1 --- +# tobacco colonies -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: tobacco colonies --- + +# Tobacco Colonies + +## Definition + +Plantations in North America, particularly Virginia and Maryland, that produce tobacco for export to European markets. Tobacco cultivation represents a specialized form of agriculture that can command high rents due to the value of the crop and the limited suitable land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses tobacco colonies as another example of specialized agricultural production that can command rents exceeding those of ordinary agricultural land, though typically not as high as sugar colonies due to greater competition and more widely available suitable land. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Tobacco colonies represent specialized operational units that produce high-value agricultural products for export markets. They demonstrate how operational units can create premium value through specialized cultivation of high-demand products, with the rent mechanism coordinating the allocation of land resources to these specialized production activities based on their market value and geographical constraints. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: rice countries-to-S1 --- +# rice countries -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: rice countries --- + +# Rice Countries + +## Definition + +Regions where rice is the primary agricultural product and staple food, such as parts of Asia and the American South. Rice cultivation typically requires specific environmental conditions and intensive labor, leading to different economic dynamics than wheat-producing regions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses rice countries to illustrate how the nature of the primary agricultural product affects the distribution of economic returns, particularly how rice cultivation can support higher rents due to its high productivity per acre. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Rice countries function as specialized operational regions where the primary economic activity is focused on rice production. They demonstrate how operational units at the regional level can specialize in specific productive activities based on environmental conditions and create distinct economic dynamics through their specialized focus, with the rent mechanism coordinating resource allocation across these specialized regions. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: potato cultivation-to-S1 --- +# potato cultivation -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: potato cultivation --- + +# Potato Cultivation + +## Definition + +The agricultural practice of growing potatoes as a staple food crop. Potato cultivation can support higher population densities and potentially higher rents than grain cultivation due to its higher productivity per acre and nutritional value. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses potato cultivation as a potentially revolutionary agricultural practice that could support larger populations and higher rents than traditional grain cultivation, though he notes the practical difficulties of storage and preservation. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Potato cultivation represents an innovative operational practice that increases agricultural productivity through more efficient use of land resources. It demonstrates how operational units can adopt new productive methods to create greater value, with the rent mechanism coordinating the allocation of land to these more productive cultivation practices based on their superior efficiency and output. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: artificial grasses-to-S1 --- +# artificial grasses -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: artificial grasses --- + +# Artificial Grasses + +# Turnips + +# Carrots + +# Cabbages + +## Definition + +Cultivated forage crops, including clover and other legumes, as well as root vegetables like turnips, carrots, and cabbages, that can be grown to feed livestock during seasons when natural pasture is unavailable. These crops increase the productivity of pasture land by enabling year-round animal husbandry. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the introduction of artificial grasses and root crops has affected the relative prices of butcher's meat and bread, demonstrating how agricultural innovations can change the economic relationships between different types of production. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Artificial grasses and root crops function as operational enhancements that increase the productivity of agricultural units by extending the productive capacity of pasture land. They demonstrate how operational units can be optimized through crop diversification and innovation to produce greater value throughout the year, with the rent mechanism coordinating the allocation of resources to these productivity-enhancing practices. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: inclosure-to-S1 --- +# inclosure -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: inclosure --- + +# Inclosure + +## Definition + +The practice of surrounding land with fences, hedges, or walls to create defined agricultural units. Inclosure increases the productivity of land by enabling better control of livestock, more intensive cultivation, and protection of crops from damage. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how inclosure affects land rents and agricultural productivity, arguing that it is particularly beneficial for pasture land and that the high rents currently commanded by inclosed land in Scotland are due to temporary scarcity rather than permanent advantage. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Inclosure represents an operational infrastructure improvement that increases the productivity of agricultural units by creating better-defined and controlled production environments. It demonstrates how operational units can be enhanced through physical infrastructure to produce greater value, with the rent mechanism coordinating the allocation of resources to these productivity-enhancing improvements. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: public fiars-to-S2 --- +# public fiars -> S2 (Coordination) + +## Economic Entity Reference + +--- ENTITY: public fiars --- + +# Public Fiars + +## Definition + +Official annual valuations of grain prices conducted by assize courts in Scotland to establish fair prices for various grains and qualities. These valuations provided a standardized basis for converting corn rents to money rents and for other legal and commercial purposes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith mentions public fiars as an example of how governments have attempted to regulate grain prices and provide stability in agricultural markets, though he generally favors market-determined prices over official valuations. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in System 1 to communicate with each other and that allow System 3 to monitor and coordinate activities. System 2 dampens oscillations and resolves conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict resolution, standardisation. + +--- + +## Mapping Rationale + +Public fiars function as a coordination mechanism that standardizes grain prices across different regions and time periods. By providing official price valuations, they create a common reference point that dampens price oscillations and resolves conflicts in grain markets, enabling more efficient coordination of agricultural production and distribution. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: conversion price-to-S2 --- +# conversion price -> S2 (Coordination) + +## Economic Entity Reference + +--- ENTITY: conversion price --- + +# Conversion Price + +## Definition + +The price at which agricultural produce, particularly grain, could be converted from payment in kind to payment in money under Scottish agricultural tenancy agreements. This price was typically set below market rates to protect tenants from excessive charges. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses conversion prices as an example of how agricultural rents were historically structured and how they affected the relationship between landlords and tenants in Scotland. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in System 1 to communicate with each other and that allow System 3 to monitor and coordinate activities. System 2 dampens oscillations and resolves conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict resolution, standardisation. + +--- + +## Mapping Rationale + +Conversion price functions as a coordination mechanism that standardizes the relationship between agricultural produce and monetary value in tenancy agreements. It provides a stable reference point that dampens price oscillations and resolves potential conflicts between landlords and tenants, enabling more predictable and coordinated agricultural operations. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: statute of labourers-to-S3 --- +# statute of labourers -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: statute of labourers --- + +# Statute of Labourers + +## Definition + +The English law enacted in 1351 during the reign of Edward III that attempted to regulate wages and prices following the labor shortages caused by the Black Death. The statute set maximum wages and prices for various goods and services. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith references the Statute of Labourers as historical evidence of grain prices in the 14th century, using it to trace the changes in the value of silver relative to corn over time. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Statute of Labourers represents a direct regulatory control mechanism that attempts to manage internal economic operations by setting maximum prices and wages. It functions as an explicit control system that establishes rules and constraints for economic actors, though Smith argues that such direct regulation often reduces rather than enhances economic efficiency. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: assize of bread and ale-to-S3 --- +# assize of bread and ale -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: assize of bread and ale --- + +# Assize of Bread and Ale + +## Definition + +Medieval English regulations that set the prices of bread and ale based on the prices of wheat and barley. These statutes attempted to maintain stable prices for essential food items by adjusting their prices according to grain market conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the assize of bread and ale as another historical example of price regulation, using it to trace the changes in grain prices and the value of silver over time. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Assize of bread and ale functions as a regulatory control mechanism that manages the internal economic environment by setting prices for essential goods. It represents an attempt to optimize the internal economic system through direct price control, though Smith argues that such regulatory interventions often create inefficiencies by interfering with natural market mechanisms. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: exportation bounty-to-S3 --- +# exportation bounty -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: exportation bounty --- + +# Exportation Bounty + +## Definition + +A government subsidy paid to encourage the export of grain, particularly wheat. The bounty was designed to support agricultural prices and encourage production by making exports more profitable. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the bounty on grain exports affected domestic grain prices and agricultural production, arguing that it raised prices in the home market and may have discouraged rather than encouraged tillage in the long run. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Exportation bounty represents a regulatory control mechanism that attempts to manage agricultural production and prices through government intervention. It functions as a policy tool that establishes incentives and constraints for economic actors, though Smith argues that such artificial controls often create unintended consequences that reduce rather than enhance economic efficiency. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: kelp-to-S1 --- +# kelp -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: kelp --- + +# Kelp + +## Definition + +A type of seaweed that, when burned, produces an alkaline salt used in glassmaking, soap production, and other industrial processes. Kelp grows on rocky shores within the high-water mark and can be harvested without cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses kelp as an example of a natural product that can command rent even though it requires no human improvement, demonstrating that rent is not solely a function of agricultural improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Kelp harvesting represents an autonomous operational activity that produces value through natural resource extraction without requiring cultivation or improvement. It demonstrates how operational units can create economic value through the direct exploitation of naturally occurring resources, with the rent mechanism coordinating the allocation of access to these natural productive resources. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: wood price-to-S4 --- +# wood price -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: wood price --- + +# Wood Price + +## Definition + +The market price of timber and firewood, which varies with the state of agriculture and population density. As agriculture advances and reduces forest land, the price of wood typically rises due to increased scarcity. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the price of wood serves as an alternative fuel source to coal and how changes in wood prices affect the demand for coal and the rents of coal mines. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Wood price functions as an environmental intelligence signal that provides information about resource scarcity and substitution patterns in the economic system. It represents how market prices serve as information mechanisms that scan the external environment and signal the need for adaptation in resource use patterns, enabling strategic responses to changing resource conditions. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: coal price-to-S4 --- +# coal price -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: coal price --- + +# Coal Price + +## Definition + +The market price of coal, which is influenced by its abundance, transportation costs, and the availability of alternative fuels. Coal prices tend to be lower in coal-producing regions and higher in areas dependent on imported coal. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes coal prices as an example of how the rent component in commodity prices varies with the natural abundance of resources, arguing that coal rents are typically lower than rents for agricultural land due to the greater abundance of coal mines. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Coal price functions as an environmental intelligence signal that provides information about resource abundance and distribution patterns in the economic system. It represents how market prices serve as information mechanisms that scan the external environment and signal the need for strategic adaptation in energy resource use, enabling responses to changing resource availability and distribution. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: silver price variation-to-S4 --- +# silver price variation -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: silver price variation --- + +# Silver Price Variation + +## Definition + +The changes over time in the value of silver relative to other commodities, particularly corn. These variations reflect changes in the supply of silver from mines and changes in the demand for silver as commerce and wealth increase. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith provides a detailed analysis of how the value of silver has changed relative to corn over the past four centuries, using this as evidence for his theories about the relationship between wealth, commerce, and the value of precious metals. + +## Economic Domain + +Exchange + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Silver price variation functions as an environmental intelligence signal that provides information about long-term economic trends and the relationship between monetary and real economic activity. It represents how price variations serve as information mechanisms that scan the external economic environment and signal the need for strategic adaptation in monetary and commercial systems. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: gold price variation-to-S4 --- +# gold price variation -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: gold price variation --- + +# Gold Price Variation + +## Definition + +The changes over time in the value of gold relative to silver and other commodities. These variations are influenced by the relative abundance of gold and silver mines and the different uses to which the metals are put. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the relative values of gold and silver have changed over time, particularly after the discovery of American mines, and how this affects their use in different economic functions. + +## Economic Domain + +Exchange + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Gold price variation functions as an environmental intelligence signal that provides information about the relative abundance and use of precious metals in the economic system. It represents how price variations serve as information mechanisms that scan the external monetary environment and signal the need for strategic adaptation in monetary systems and international trade. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: precious metals consumption-to-S1 --- +# precious metals consumption -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: precious metals consumption --- + +# Precious Metals Consumption + +## Definition + +The use of gold and silver in various forms including coin, plate, jewelry, and industrial applications. This consumption creates ongoing demand for newly mined precious metals to replace losses from wear, damage, and industrial use. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the consumption of precious metals in various forms creates a continuous demand that must be met by new production, affecting their long-term value and availability. + +## Economic Domain + +Consumption + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Precious metals \ No newline at end of file diff --git a/examples/infospace-with-history/output/mappings/book-1-chapter-11-mappings.md b/examples/infospace-with-history/output/mappings/book-1-chapter-11-mappings.md new file mode 100644 index 00000000..28c3ea14 --- /dev/null +++ b/examples/infospace-with-history/output/mappings/book-1-chapter-11-mappings.md @@ -0,0 +1,1567 @@ +--- MAPPING: rent-of-land-to-S1 --- +# rent-of-land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: rent-of-land --- + +# Rent of Land + +## Definition + +The payment made by a tenant to a landlord for the use of land, representing the surplus value that the land generates beyond what is required to maintain the stock employed in cultivation and provide ordinary profits to the farmer. Rent is determined by what the tenant can afford to pay based on the productive capacity of the land, not by the landlord's investment in improvements. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +This is the central concept of the chapter, forming the foundation for Smith's analysis of how rent functions as a component of commodity prices and how it varies with different types of land and produce. The chapter systematically examines rent's nature, determinants, and relationship to other economic factors. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Rent of land represents the operational output of agricultural land as a productive unit. In Smith's analysis, land functions as an autonomous operational element that directly produces value through its natural productive capacity. The rent payment is the mechanism by which the surplus value created by this operational unit is distributed, making land itself the primary value-producing entity within the agricultural economy. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: rent-of-land-to-S3 --- +# rent-of-land -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: rent-of-land --- + +# Rent of Land + +## Definition + +The payment made by a tenant to a landlord for the use of land, representing the surplus value that the land generates beyond what is required to maintain the stock employed in cultivation and provide ordinary profits to the farmer. Rent is determined by what the tenant can afford to pay based on the productive capacity of the land, not by the landlord's investment in improvements. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +This is the central concept of the chapter, forming the foundation for Smith's analysis of how rent functions as a component of commodity prices and how it varies with different types of land and produce. The chapter systematically examines rent's nature, determinants, and relationship to other economic factors. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Rent of land functions as a regulatory mechanism that controls the allocation of agricultural resources within the economic system. It establishes the rules and rights governing land use, determines the distribution of surplus value, and creates incentives for optimal land management. The rent mechanism acts as an internal regulatory system that optimises the use of land resources across the economy. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: natural rent of land-to-S3 --- +# natural rent of land -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: natural rent of land --- + +# Natural Rent of Land + +## Definition + +The ordinary or typical rent that land commands in the market, determined by the surplus value that can be extracted from the land after maintaining the stock required for cultivation and providing ordinary profits to the farmer. This represents the price that land would naturally command in the absence of special circumstances or market distortions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith distinguishes between the natural rent that land would command under ordinary market conditions and the actual rent that may result from various circumstances. This concept helps explain the baseline against which other rent variations can be measured. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Natural rent of land serves as the baseline regulatory framework for land resource allocation in the economic system. It represents the standard control mechanism that would operate in the absence of market distortions, providing a reference point for optimal resource distribution. This concept functions as the internal regulatory standard against which actual market conditions are measured and managed. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: monopoly price of land-to-S3 --- +# monopoly price of land -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: monopoly price of land --- + +# Monopoly Price of Land + +## Definition + +The price paid for the use of land that exceeds what would be paid under competitive conditions, arising from the landlord's exclusive control over a particular piece of land. This price is determined by what the tenant can afford to pay rather than by the cost of providing the land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is essentially a monopoly price because it is not determined by the cost of providing the land but by what the tenant can afford to pay based on the land's productive capacity. This concept is crucial for understanding how rent differs from other forms of economic returns. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Monopoly price of land represents a distortion in the internal regulatory mechanism of the economic system. It shows how exclusive control over resources can create regulatory failures where the standard control mechanisms (natural rent) are overridden by monopolistic power. This concept highlights the need for higher-level regulatory intervention to correct market failures and restore optimal resource allocation. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: corn rent-to-S1 --- +# corn rent -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: corn rent --- + +# Corn Rent + +## Definition + +Rent paid in the form of a portion of the agricultural produce, particularly grain, rather than in money. This form of rent directly ties the landlord's income to the productivity of the land and the success of the harvest. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how rent can be paid either in kind (corn rent) or in money, and how this distinction affects the relationship between landlords and tenants. Corn rent provides a more direct connection between land productivity and landlord income. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Corn rent represents the direct operational output of agricultural land as a productive unit. It embodies the principle that land as an operational element produces tangible value that can be directly distributed as rent. This form of rent maintains the connection between the operational productivity of land and the economic returns it generates, functioning as a pure expression of land's productive capacity. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: money rent-to-S2 --- +# money rent -> S2 (Coordination) + +## Economic Entity Reference + +--- ENTITY: money rent --- + +# Money Rent + +## Definition + +Rent paid in monetary form rather than in agricultural produce. This represents the market value of the land's productive capacity expressed in currency terms. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the transition from corn rent to money rent affects the relationship between landlords and tenants, and how money rent provides a more flexible and standardized form of payment that can better reflect market conditions. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in System 1 to communicate with each other and that allow System 3 to monitor and coordinate activities. System 2 dampens oscillations and resolves conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict resolution, standardisation. + +--- + +## Mapping Rationale + +Money rent functions as a coordination mechanism that standardizes the value of land across different agricultural operations and regions. By expressing rent in monetary terms, it creates a common language for comparing and coordinating land values, dampening the oscillations that would occur if rents were paid in kind. This standardization enables more efficient resource allocation and market coordination. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: unimproved land-to-S1 --- +# unimproved land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: unimproved land --- + +# Unimproved Land + +## Definition + +Land that has not been enhanced through human investment in drainage, fencing, clearing, or other improvements that increase its productive capacity. Even unimproved land can command rent based on its natural productive qualities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses examples of unimproved land, such as kelp-producing shores and uncultivated pastures, to demonstrate that rent is not solely a function of human improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Unimproved land represents an autonomous operational unit that produces value through its natural productive capacity without human intervention. It demonstrates that operational value creation can occur through natural processes rather than just through human-directed activities. This concept shows how operational units in the economic system can function based on inherent properties rather than constructed improvements. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: improved land-to-S1 --- +# improved land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: improved land --- + +# Improved Land + +## Definition + +Land that has been enhanced through human investment in cultivation, drainage, fencing, clearing, or other modifications that increase its productive capacity beyond its natural state. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements to land affect its productive capacity and, consequently, the rent it can command. Improved land typically generates higher rents due to its increased productivity. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Improved land represents an enhanced operational unit whose productivity has been increased through human intervention. It demonstrates how operational units can be optimized through investment and modification to produce greater value. The improvements function as operational enhancements that increase the unit's capacity to create surplus value, which is then reflected in higher rents. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: pasture land-to-S1 --- +# pasture land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: pasture land --- + +# Pasture Land + +## Definition + +Land used primarily for grazing livestock, particularly cattle and sheep. The rent of pasture land is determined by its capacity to support animals and the market value of the livestock products it produces. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the rent of pasture land varies with its quality and location, and how it competes with corn land in the agricultural economy. He examines the factors that determine whether land is more profitably used for pasture or cultivation. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Pasture land functions as an autonomous operational unit that produces value through livestock grazing operations. It represents a specialized form of agricultural production that directly creates economic output through natural biological processes. The rent mechanism coordinates the allocation of this operational resource based on its productive capacity and market conditions. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: corn land-to-S1 --- +# corn land -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: corn land --- + +# Corn Land + +## Definition + +Land used for growing grain crops, particularly wheat and other cereals. The rent of corn land is determined by its productivity in grain production and the market price of grain. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how corn land serves as the baseline for determining rents of other types of land, as grain production is the most fundamental agricultural activity and provides the subsistence for most of the population. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Corn land represents the fundamental operational unit of agricultural production, serving as the baseline reference for all other agricultural operations. Its productivity directly determines the subsistence capacity of the economy and provides the foundation for all other economic activities. The rent mechanism for corn land establishes the standard by which all other land rents are measured and coordinated. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: vineyard-to-S1 --- +# vineyard -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: vineyard --- + +# Vineyard + +## Definition + +Land specifically cultivated for grape production to make wine. Vineyards often command premium rents due to the high value of wine and the limited geographical areas suitable for viticulture. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses vineyards as an example of land that can command exceptionally high rents due to the high value of its produce and the limited supply of suitable land. He discusses how vineyard rents are regulated by the profitability of corn production. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Vineyard represents a specialized operational unit that produces high-value output through specific agricultural processes. Its autonomous operation creates premium value that exceeds standard agricultural production, demonstrating how specialized operational units can command higher returns based on their unique productive characteristics and market position. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: kitchen garden-to-S1 --- +# kitchen garden -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: kitchen garden --- + +# Kitchen Garden + +## Definition + +Land used for growing vegetables and herbs for household consumption. Kitchen gardens require intensive cultivation and can command higher rents per unit area than field crops due to their high value relative to the land they occupy. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses kitchen gardens as an example of high-value agricultural production that can justify intensive cultivation and higher rents, particularly when located near urban markets where fresh produce commands premium prices. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Kitchen garden functions as an intensive operational unit that maximizes value production per unit of land through specialized cultivation techniques. It demonstrates how operational units can optimize their productive capacity through focused specialization and proximity to high-value markets, creating premium returns that justify higher resource allocation. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: hop garden-to-S1 --- +# hop garden -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: hop garden --- + +# Hop Garden + +## Definition + +Land specifically cultivated for growing hops, used primarily in beer production. Hop gardens represent a specialized form of agriculture that can command higher rents due to the value of the crop and the intensive cultivation required. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses hop gardens as an example of specialized agricultural production that requires more investment and care than general field crops, and therefore can command higher rents and profits. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Hop garden represents a specialized operational unit focused on producing a specific high-value input for another industry. It demonstrates how operational units can create premium value through specialization and intensive cultivation, with the rent mechanism coordinating the allocation of land resources to their most productive specialized uses. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: fruit garden-to-S1 --- +# fruit garden -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: fruit garden --- + +# Fruit Garden + +## Definition + +Land used for growing fruit trees and bushes. Fruit gardens represent a long-term investment in agriculture that can command premium rents due to the high value of fruit relative to the land required for its production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses fruit gardens as another example of specialized agricultural production that can justify higher rents due to the value of the produce and the care required for successful cultivation. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Fruit garden functions as a long-term operational unit that produces high-value output through specialized cultivation requiring significant investment and care. It demonstrates how operational units can create premium value through patient capital investment and specialized knowledge, with the rent mechanism coordinating the allocation of resources to these high-value specialized operations. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: fruit-wall-to-S1 --- +# fruit-wall -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: fruit-wall --- + +# Fruit-Wall + +## Definition + +A wall constructed around a kitchen garden or orchard to protect fruit trees from wind and to create a warmer microclimate that extends the growing season. The cost of building and maintaining fruit-walls is justified by the higher value of the protected fruit production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses fruit-walls as an example of agricultural improvements that increase the value of land by enabling the production of higher-value crops that would not otherwise be viable in the local climate. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Fruit-wall represents an operational enhancement that increases the productive capacity of agricultural units by modifying their environmental conditions. It demonstrates how operational units can be optimized through infrastructure investment to produce higher-value outputs, with the rent mechanism coordinating the allocation of resources to these productivity-enhancing improvements. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: sugar colonies-to-S1 --- +# sugar colonies -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: sugar colonies --- + +# Sugar Colonies + +## Definition + +Plantations in tropical regions, particularly in the West Indies, that produce sugar cane for export to European markets. These colonies represent a form of specialized agricultural production that commands exceptionally high profits and rents due to the high value of sugar and the limited geographical areas suitable for its cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses sugar colonies as an extreme example of land that can command rents far exceeding those of ordinary agricultural land, due to the combination of high-value production and limited suitable territory. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Sugar colonies function as highly specialized operational units that produce exceptional value through unique geographical advantages and specialized cultivation. They demonstrate how operational units in specific locations can create premium value through natural advantages combined with intensive production methods, with the rent mechanism coordinating the allocation of these scarce high-value resources. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: tobacco colonies-to-S1 --- +# tobacco colonies -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: tobacco colonies --- + +# Tobacco Colonies + +## Definition + +Plantations in North America, particularly Virginia and Maryland, that produce tobacco for export to European markets. Tobacco cultivation represents a specialized form of agriculture that can command high rents due to the value of the crop and the limited suitable land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses tobacco colonies as another example of specialized agricultural production that can command rents exceeding those of ordinary agricultural land, though typically not as high as sugar colonies due to greater competition and more widely available suitable land. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Tobacco colonies represent specialized operational units that produce high-value agricultural products for export markets. They demonstrate how operational units can create premium value through specialized cultivation of high-demand products, with the rent mechanism coordinating the allocation of land resources to these specialized production activities based on their market value and geographical constraints. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: rice countries-to-S1 --- +# rice countries -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: rice countries --- + +# Rice Countries + +## Definition + +Regions where rice is the primary agricultural product and staple food, such as parts of Asia and the American South. Rice cultivation typically requires specific environmental conditions and intensive labor, leading to different economic dynamics than wheat-producing regions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses rice countries to illustrate how the nature of the primary agricultural product affects the distribution of economic returns, particularly how rice cultivation can support higher rents due to its high productivity per acre. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Rice countries function as specialized operational regions where the primary economic activity is focused on rice production. They demonstrate how operational units at the regional level can specialize in specific productive activities based on environmental conditions and create distinct economic dynamics through their specialized focus, with the rent mechanism coordinating resource allocation across these specialized regions. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: potato cultivation-to-S1 --- +# potato cultivation -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: potato cultivation --- + +# Potato Cultivation + +## Definition + +The agricultural practice of growing potatoes as a staple food crop. Potato cultivation can support higher population densities and potentially higher rents than grain cultivation due to its higher productivity per acre and nutritional value. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses potato cultivation as a potentially revolutionary agricultural practice that could support larger populations and higher rents than traditional grain cultivation, though he notes the practical difficulties of storage and preservation. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Potato cultivation represents an innovative operational practice that increases agricultural productivity through more efficient use of land resources. It demonstrates how operational units can adopt new productive methods to create greater value, with the rent mechanism coordinating the allocation of land to these more productive cultivation practices based on their superior efficiency and output. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: artificial grasses-to-S1 --- +# artificial grasses -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: artificial grasses --- + +# Artificial Grasses + +# Turnips + +# Carrots + +# Cabbages + +## Definition + +Cultivated forage crops, including clover and other legumes, as well as root vegetables like turnips, carrots, and cabbages, that can be grown to feed livestock during seasons when natural pasture is unavailable. These crops increase the productivity of pasture land by enabling year-round animal husbandry. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the introduction of artificial grasses and root crops has affected the relative prices of butcher's meat and bread, demonstrating how agricultural innovations can change the economic relationships between different types of production. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Artificial grasses and root crops function as operational enhancements that increase the productivity of agricultural units by extending the productive capacity of pasture land. They demonstrate how operational units can be optimized through crop diversification and innovation to produce greater value throughout the year, with the rent mechanism coordinating the allocation of resources to these productivity-enhancing practices. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: inclosure-to-S1 --- +# inclosure -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: inclosure --- + +# Inclosure + +## Definition + +The practice of surrounding land with fences, hedges, or walls to create defined agricultural units. Inclosure increases the productivity of land by enabling better control of livestock, more intensive cultivation, and protection of crops from damage. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how inclosure affects land rents and agricultural productivity, arguing that it is particularly beneficial for pasture land and that the high rents currently commanded by inclosed land in Scotland are due to temporary scarcity rather than permanent advantage. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Inclosure represents an operational infrastructure improvement that increases the productivity of agricultural units by creating better-defined and controlled production environments. It demonstrates how operational units can be enhanced through physical infrastructure to produce greater value, with the rent mechanism coordinating the allocation of resources to these productivity-enhancing improvements. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: public fiars-to-S2 --- +# public fiars -> S2 (Coordination) + +## Economic Entity Reference + +--- ENTITY: public fiars --- + +# Public Fiars + +## Definition + +Official annual valuations of grain prices conducted by assize courts in Scotland to establish fair prices for various grains and qualities. These valuations provided a standardized basis for converting corn rents to money rents and for other legal and commercial purposes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith mentions public fiars as an example of how governments have attempted to regulate grain prices and provide stability in agricultural markets, though he generally favors market-determined prices over official valuations. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in System 1 to communicate with each other and that allow System 3 to monitor and coordinate activities. System 2 dampens oscillations and resolves conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict resolution, standardisation. + +--- + +## Mapping Rationale + +Public fiars function as a coordination mechanism that standardizes grain prices across different regions and time periods. By providing official price valuations, they create a common reference point that dampens price oscillations and resolves conflicts in grain markets, enabling more efficient coordination of agricultural production and distribution. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: conversion price-to-S2 --- +# conversion price -> S2 (Coordination) + +## Economic Entity Reference + +--- ENTITY: conversion price --- + +# Conversion Price + +## Definition + +The price at which agricultural produce, particularly grain, could be converted from payment in kind to payment in money under Scottish agricultural tenancy agreements. This price was typically set below market rates to protect tenants from excessive charges. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses conversion prices as an example of how agricultural rents were historically structured and how they affected the relationship between landlords and tenants in Scotland. + +## Economic Domain + +Distribution + +--- + +## VSM Concept Reference + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in System 1 to communicate with each other and that allow System 3 to monitor and coordinate activities. System 2 dampens oscillations and resolves conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict resolution, standardisation. + +--- + +## Mapping Rationale + +Conversion price functions as a coordination mechanism that standardizes the relationship between agricultural produce and monetary value in tenancy agreements. It provides a stable reference point that dampens price oscillations and resolves potential conflicts between landlords and tenants, enabling more predictable and coordinated agricultural operations. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: statute of labourers-to-S3 --- +# statute of labourers -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: statute of labourers --- + +# Statute of Labourers + +## Definition + +The English law enacted in 1351 during the reign of Edward III that attempted to regulate wages and prices following the labor shortages caused by the Black Death. The statute set maximum wages and prices for various goods and services. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith references the Statute of Labourers as historical evidence of grain prices in the 14th century, using it to trace the changes in the value of silver relative to corn over time. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Statute of Labourers represents a direct regulatory control mechanism that attempts to manage internal economic operations by setting maximum prices and wages. It functions as an explicit control system that establishes rules and constraints for economic actors, though Smith argues that such direct regulation often reduces rather than enhances economic efficiency. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: assize of bread and ale-to-S3 --- +# assize of bread and ale -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: assize of bread and ale --- + +# Assize of Bread and Ale + +## Definition + +Medieval English regulations that set the prices of bread and ale based on the prices of wheat and barley. These statutes attempted to maintain stable prices for essential food items by adjusting their prices according to grain market conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the assize of bread and ale as another historical example of price regulation, using it to trace the changes in grain prices and the value of silver over time. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Assize of bread and ale functions as a regulatory control mechanism that manages the internal economic environment by setting prices for essential goods. It represents an attempt to optimize the internal economic system through direct price control, though Smith argues that such regulatory interventions often create inefficiencies by interfering with natural market mechanisms. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: exportation bounty-to-S3 --- +# exportation bounty -> S3 (Control) + +## Economic Entity Reference + +--- ENTITY: exportation bounty --- + +# Exportation Bounty + +## Definition + +A government subsidy paid to encourage the export of grain, particularly wheat. The bounty was designed to support agricultural prices and encourage production by making exports more profitable. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the bounty on grain exports affected domestic grain prices and agricultural production, arguing that it raised prices in the home market and may have discouraged rather than encouraged tillage in the long run. + +## Economic Domain + +Regulation + +--- + +## VSM Concept Reference + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, and responsibilities of System 1 and provide an interface between Systems 1 and Systems 4/5. System 3 represents the day-to-day control of the organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour laws, enforcement of contracts, the "invisible hand" as emergent internal regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, synergy extraction, performance management. + +--- + +## Mapping Rationale + +Exportation bounty represents a regulatory control mechanism that attempts to manage agricultural production and prices through government intervention. It functions as a policy tool that establishes incentives and constraints for economic actors, though Smith argues that such artificial controls often create unintended consequences that reduce rather than enhance economic efficiency. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: kelp-to-S1 --- +# kelp -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: kelp --- + +# Kelp + +## Definition + +A type of seaweed that, when burned, produces an alkaline salt used in glassmaking, soap production, and other industrial processes. Kelp grows on rocky shores within the high-water mark and can be harvested without cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses kelp as an example of a natural product that can command rent even though it requires no human improvement, demonstrating that rent is not solely a function of agricultural improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Kelp harvesting represents an autonomous operational activity that produces value through natural resource extraction without requiring cultivation or improvement. It demonstrates how operational units can create economic value through the direct exploitation of naturally occurring resources, with the rent mechanism coordinating the allocation of access to these natural productive resources. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: wood price-to-S4 --- +# wood price -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: wood price --- + +# Wood Price + +## Definition + +The market price of timber and firewood, which varies with the state of agriculture and population density. As agriculture advances and reduces forest land, the price of wood typically rises due to increased scarcity. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the price of wood serves as an alternative fuel source to coal and how changes in wood prices affect the demand for coal and the rents of coal mines. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Wood price functions as an environmental intelligence signal that provides information about resource scarcity and substitution patterns in the economic system. It represents how market prices serve as information mechanisms that scan the external environment and signal the need for adaptation in resource use patterns, enabling strategic responses to changing resource conditions. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: coal price-to-S4 --- +# coal price -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: coal price --- + +# Coal Price + +## Definition + +The market price of coal, which is influenced by its abundance, transportation costs, and the availability of alternative fuels. Coal prices tend to be lower in coal-producing regions and higher in areas dependent on imported coal. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes coal prices as an example of how the rent component in commodity prices varies with the natural abundance of resources, arguing that coal rents are typically lower than rents for agricultural land due to the greater abundance of coal mines. + +## Economic Domain + +Production + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Coal price functions as an environmental intelligence signal that provides information about resource abundance and distribution patterns in the economic system. It represents how market prices serve as information mechanisms that scan the external environment and signal the need for strategic adaptation in energy resource use, enabling responses to changing resource availability and distribution. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: silver price variation-to-S4 --- +# silver price variation -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: silver price variation --- + +# Silver Price Variation + +## Definition + +The changes over time in the value of silver relative to other commodities, particularly corn. These variations reflect changes in the supply of silver from mines and changes in the demand for silver as commerce and wealth increase. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith provides a detailed analysis of how the value of silver has changed relative to corn over the past four centuries, using this as evidence for his theories about the relationship between wealth, commerce, and the value of precious metals. + +## Economic Domain + +Exchange + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Silver price variation functions as an environmental intelligence signal that provides information about long-term economic trends and the relationship between monetary and real economic activity. It represents how price variations serve as information mechanisms that scan the external economic environment and signal the need for strategic adaptation in monetary and commercial systems. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: gold price variation-to-S4 --- +# gold price variation -> S4 (Intelligence) + +## Economic Entity Reference + +--- ENTITY: gold price variation --- + +# Gold Price Variation + +## Definition + +The changes over time in the value of gold relative to silver and other commodities. These variations are influenced by the relative abundance of gold and silver mines and the different uses to which the metals are put. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the relative values of gold and silver have changed over time, particularly after the discovery of American mines, and how this affects their use in different economic functions. + +## Economic Domain + +Exchange + +--- + +## VSM Concept Reference + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor how the organisation needs to adapt to remain viable. System 4 captures all relevant information about the outside-and-then environment. It is responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, market research, new technology adoption, colonial exploration and trade route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic planning, modelling, research and development. + +--- + +## Mapping Rationale + +Gold price variation functions as an environmental intelligence signal that provides information about the relative abundance and use of precious metals in the economic system. It represents how price variations serve as information mechanisms that scan the external monetary environment and signal the need for strategic adaptation in monetary systems and international trade. + +## Mapping Strength + +Strong + +--- + +--- MAPPING: precious metals consumption-to-S1 --- +# precious metals consumption -> S1 (Operations) + +## Economic Entity Reference + +--- ENTITY: precious metals consumption --- + +# Precious Metals Consumption + +## Definition + +The use of gold and silver in various forms including coin, plate, jewelry, and industrial applications. This consumption creates ongoing demand for newly mined precious metals to replace losses from wear, damage, and industrial use. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the consumption of precious metals in various forms creates a continuous demand that must be met by new production, affecting their long-term value and availability. + +## Economic Domain + +Consumption + +--- + +## VSM Concept Reference + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the operational units that directly create value. Each operational element is itself a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, direct engagement with the environment. + +--- + +## Mapping Rationale + +Precious metals \ No newline at end of file diff --git a/examples/infospace-with-history/output/mappings/book-1-chapter-11-prompt.md b/examples/infospace-with-history/output/mappings/book-1-chapter-11-prompt.md new file mode 100644 index 00000000..cc20129d --- /dev/null +++ b/examples/infospace-with-history/output/mappings/book-1-chapter-11-prompt.md @@ -0,0 +1,1530 @@ +# Map Economic Entities to VSM Concepts + +You are a systems theorist specializing in Stafford Beer's Viable System Model. +Your task is to map extracted economic entities to VSM concepts. + +## Extracted Entities + +--- ENTITY: rent-of-land --- + +# Rent of Land + +## Definition + +The payment made by a tenant to a landlord for the use of land, representing the surplus value that the land generates beyond what is required to maintain the stock employed in cultivation and provide ordinary profits to the farmer. Rent is determined by what the tenant can afford to pay based on the productive capacity of the land, not by the landlord's investment in improvements. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +This is the central concept of the chapter, forming the foundation for Smith's analysis of how rent functions as a component of commodity prices and how it varies with different types of land and produce. The chapter systematically examines rent's nature, determinants, and relationship to other economic factors. + +## Economic Domain + +Distribution + +--- +--- ENTITY: natural rent of land --- + +# Natural Rent of Land + +## Definition + +The ordinary or typical rent that land commands in the market, determined by the surplus value that can be extracted from the land after maintaining the stock required for cultivation and providing ordinary profits to the farmer. This represents the price that land would naturally command in the absence of special circumstances or market distortions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith distinguishes between the natural rent that land would command under ordinary market conditions and the actual rent that may result from various circumstances. This concept helps explain the baseline against which other rent variations can be measured. + +## Economic Domain + +Distribution + +--- +--- ENTITY: monopoly price of land --- + +# Monopoly Price of Land + +## Definition + +The price paid for the use of land that exceeds what would be paid under competitive conditions, arising from the landlord's exclusive control over a particular piece of land. This price is determined by what the tenant can afford to pay rather than by the cost of providing the land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is essentially a monopoly price because it is not determined by the cost of providing the land but by what the tenant can afford to pay based on the land's productive capacity. This concept is crucial for understanding how rent differs from other forms of economic returns. + +## Economic Domain + +Distribution + +--- +--- ENTITY: corn rent --- + +# Corn Rent + +## Definition + +Rent paid in the form of a portion of the agricultural produce, particularly grain, rather than in money. This form of rent directly ties the landlord's income to the productivity of the land and the success of the harvest. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how rent can be paid either in kind (corn rent) or in money, and how this distinction affects the relationship between landlords and tenants. Corn rent provides a more direct connection between land productivity and landlord income. + +## Economic Domain + +Distribution + +--- +--- ENTITY: money rent --- + +# Money Rent + +## Definition + +Rent paid in monetary form rather than in agricultural produce. This represents the market value of the land's productive capacity expressed in currency terms. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the transition from corn rent to money rent affects the relationship between landlords and tenants, and how money rent provides a more flexible and standardized form of payment that can better reflect market conditions. + +## Economic Domain + +Distribution + +--- +--- ENTITY: unimproved land --- + +# Unimproved Land + +## Definition + +Land that has not been enhanced through human investment in drainage, fencing, clearing, or other improvements that increase its productive capacity. Even unimproved land can command rent based on its natural productive qualities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses examples of unimproved land, such as kelp-producing shores and uncultivated pastures, to demonstrate that rent is not solely a function of human improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- +--- ENTITY: improved land --- + +# Improved Land + +## Definition + +Land that has been enhanced through human investment in cultivation, drainage, fencing, clearing, or other modifications that increase its productive capacity beyond its natural state. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements to land affect its productive capacity and, consequently, the rent it can command. Improved land typically generates higher rents due to its increased productivity. + +## Economic Domain + +Production + +--- +--- ENTITY: pasture land --- + +# Pasture Land + +## Definition + +Land used primarily for grazing livestock, particularly cattle and sheep. The rent of pasture land is determined by its capacity to support animals and the market value of the livestock products it produces. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the rent of pasture land varies with its quality and location, and how it competes with corn land in the agricultural economy. He examines the factors that determine whether land is more profitably used for pasture or cultivation. + +## Economic Domain + +Production + +--- +--- ENTITY: corn land --- + +# Corn Land + +## Definition + +Land used for growing grain crops, particularly wheat and other cereals. The rent of corn land is determined by its productivity in grain production and the market price of grain. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how corn land serves as the baseline for determining rents of other types of land, as grain production is the most fundamental agricultural activity and provides the subsistence for most of the population. + +## Economic Domain + +Production + +--- +--- ENTITY: vineyard --- + +# Vineyard + +## Definition + +Land specifically cultivated for grape production to make wine. Vineyards often command premium rents due to the high value of wine and the limited geographical areas suitable for viticulture. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses vineyards as an example of land that can command exceptionally high rents due to the high value of its produce and the limited supply of suitable land. He discusses how vineyard rents are regulated by the profitability of corn production. + +## Economic Domain + +Production + +--- +--- ENTITY: kitchen garden --- + +# Kitchen Garden + +## Definition + +Land used for growing vegetables and herbs for household consumption. Kitchen gardens require intensive cultivation and can command higher rents per unit area than field crops due to their high value relative to the land they occupy. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses kitchen gardens as an example of high-value agricultural production that can justify intensive cultivation and higher rents, particularly when located near urban markets where fresh produce commands premium prices. + +## Economic Domain + +Production + +--- +--- ENTITY: hop garden --- + +# Hop Garden + +## Definition + +Land specifically cultivated for growing hops, used primarily in beer production. Hop gardens represent a specialized form of agriculture that can command higher rents due to the value of the crop and the intensive cultivation required. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses hop gardens as an example of specialized agricultural production that requires more investment and care than general field crops, and therefore can command higher rents and profits. + +## Economic Domain + +Production + +--- +--- ENTITY: fruit garden --- + +# Fruit Garden + +## Definition + +Land used for growing fruit trees and bushes. Fruit gardens represent a long-term investment in agriculture that can command premium rents due to the high value of fruit relative to the land required for its production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses fruit gardens as another example of specialized agricultural production that can justify higher rents due to the value of the produce and the care required for successful cultivation. + +## Economic Domain + +Production + +--- +--- ENTITY: fruit-wall --- + +# Fruit-Wall + +## Definition + +A wall constructed around a kitchen garden or orchard to protect fruit trees from wind and to create a warmer microclimate that extends the growing season. The cost of building and maintaining fruit-walls is justified by the higher value of the protected fruit production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses fruit-walls as an example of agricultural improvements that increase the value of land by enabling the production of higher-value crops that would not otherwise be viable in the local climate. + +## Economic Domain + +Production + +--- +--- ENTITY: sugar colonies --- + +# Sugar Colonies + +## Definition + +Plantations in tropical regions, particularly in the West Indies, that produce sugar cane for export to European markets. These colonies represent a form of specialized agricultural production that commands exceptionally high profits and rents due to the high value of sugar and the limited geographical areas suitable for its cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses sugar colonies as an extreme example of land that can command rents far exceeding those of ordinary agricultural land, due to the combination of high-value production and limited suitable territory. + +## Economic Domain + +Production + +--- +--- ENTITY: tobacco colonies --- + +# Tobacco Colonies + +## Definition + +Plantations in North America, particularly Virginia and Maryland, that produce tobacco for export to European markets. Tobacco cultivation represents a specialized form of agriculture that can command high rents due to the value of the crop and the limited suitable land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses tobacco colonies as another example of specialized agricultural production that can command rents exceeding those of ordinary agricultural land, though typically not as high as sugar colonies due to greater competition and more widely available suitable land. + +## Economic Domain + +Production + +--- +--- ENTITY: rice countries --- + +# Rice Countries + +## Definition + +Regions where rice is the primary agricultural product and staple food, such as parts of Asia and the American South. Rice cultivation typically requires specific environmental conditions and intensive labor, leading to different economic dynamics than wheat-producing regions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses rice countries to illustrate how the nature of the primary agricultural product affects the distribution of economic returns, particularly how rice cultivation can support higher rents due to its high productivity per acre. + +## Economic Domain + +Production + +--- +--- ENTITY: potato cultivation --- + +# Potato Cultivation + +## Definition + +The agricultural practice of growing potatoes as a staple food crop. Potato cultivation can support higher population densities and potentially higher rents than grain cultivation due to its higher productivity per acre and nutritional value. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses potato cultivation as a potentially revolutionary agricultural practice that could support larger populations and higher rents than traditional grain cultivation, though he notes the practical difficulties of storage and preservation. + +## Economic Domain + +Production + +--- +--- ENTITY: artificial grasses --- + +# Artificial Grasses + +# Turnips + +# Carrots + +# Cabbages + +## Definition + +Cultivated forage crops, including clover and other legumes, as well as root vegetables like turnips, carrots, and cabbages, that can be grown to feed livestock during seasons when natural pasture is unavailable. These crops increase the productivity of pasture land by enabling year-round animal husbandry. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the introduction of artificial grasses and root crops has affected the relative prices of butcher's meat and bread, demonstrating how agricultural innovations can change the economic relationships between different types of production. + +## Economic Domain + +Production + +--- +--- ENTITY: inclosure --- + +# Inclosure + +## Definition + +The practice of surrounding land with fences, hedges, or walls to create defined agricultural units. Inclosure increases the productivity of land by enabling better control of livestock, more intensive cultivation, and protection of crops from damage. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how inclosure affects land rents and agricultural productivity, arguing that it is particularly beneficial for pasture land and that the high rents currently commanded by inclosed land in Scotland are due to temporary scarcity rather than permanent advantage. + +## Economic Domain + +Production + +--- +--- ENTITY: public fiars --- + +# Public Fiars + +## Definition + +Official annual valuations of grain prices conducted by assize courts in Scotland to establish fair prices for various grains and qualities. These valuations provided a standardized basis for converting corn rents to money rents and for other legal and commercial purposes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith mentions public fiars as an example of how governments have attempted to regulate grain prices and provide stability in agricultural markets, though he generally favors market-determined prices over official valuations. + +## Economic Domain + +Regulation + +--- +--- ENTITY: conversion price --- + +# Conversion Price + +## Definition + +The price at which agricultural produce, particularly grain, could be converted from payment in kind to payment in money under Scottish agricultural tenancy agreements. This price was typically set below market rates to protect tenants from excessive charges. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses conversion prices as an example of how agricultural rents were historically structured and how they affected the relationship between landlords and tenants in Scotland. + +## Economic Domain + +Distribution + +--- +--- ENTITY: statute of labourers --- + +# Statute of Labourers + +## Definition + +The English law enacted in 1351 during the reign of Edward III that attempted to regulate wages and prices following the labor shortages caused by the Black Death. The statute set maximum wages and prices for various goods and services. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith references the Statute of Labourers as historical evidence of grain prices in the 14th century, using it to trace the changes in the value of silver relative to corn over time. + +## Economic Domain + +Regulation + +--- +--- ENTITY: assize of bread and ale --- + +# Assize of Bread and Ale + +## Definition + +Medieval English regulations that set the prices of bread and ale based on the prices of wheat and barley. These statutes attempted to maintain stable prices for essential food items by adjusting their prices according to grain market conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the assize of bread and ale as another historical example of price regulation, using it to trace the changes in grain prices and the value of silver over time. + +## Economic Domain + +Regulation + +--- +--- ENTITY: exportation bounty --- + +# Exportation Bounty + +## Definition + +A government subsidy paid to encourage the export of grain, particularly wheat. The bounty was designed to support agricultural prices and encourage production by making exports more profitable. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how the bounty on grain exports affected domestic grain prices and agricultural production, arguing that it raised prices in the home market and may have discouraged rather than encouraged tillage in the long run. + +## Economic Domain + +Regulation + +--- +--- ENTITY: kelp --- + +# Kelp + +## Definition + +A type of seaweed that, when burned, produces an alkaline salt used in glassmaking, soap production, and other industrial processes. Kelp grows on rocky shores within the high-water mark and can be harvested without cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses kelp as an example of a natural product that can command rent even though it requires no human improvement, demonstrating that rent is not solely a function of agricultural improvements but also reflects the natural productive capacity of land. + +## Economic Domain + +Production + +--- +--- ENTITY: wood price --- + +# Wood Price + +## Definition + +The market price of timber and firewood, which varies with the state of agriculture and population density. As agriculture advances and reduces forest land, the price of wood typically rises due to increased scarcity. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the price of wood serves as an alternative fuel source to coal and how changes in wood prices affect the demand for coal and the rents of coal mines. + +## Economic Domain + +Production + +--- +--- ENTITY: coal price --- + +# Coal Price + +## Definition + +The market price of coal, which is influenced by its abundance, transportation costs, and the availability of alternative fuels. Coal prices tend to be lower in coal-producing regions and higher in areas dependent on imported coal. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes coal prices as an example of how the rent component in commodity prices varies with the natural abundance of resources, arguing that coal rents are typically lower than rents for agricultural land due to the greater abundance of coal mines. + +## Economic Domain + +Production + +--- +--- ENTITY: silver price variation --- + +# Silver Price Variation + +## Definition + +The changes over time in the value of silver relative to other commodities, particularly corn. These variations reflect changes in the supply of silver from mines and changes in the demand for silver as commerce and wealth increase. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith provides a detailed analysis of how the value of silver has changed relative to corn over the past four centuries, using this as evidence for his theories about the relationship between wealth, commerce, and the value of precious metals. + +## Economic Domain + +Exchange + +--- +--- ENTITY: gold price variation --- + +# Gold Price Variation + +## Definition + +The changes over time in the value of gold relative to silver and other commodities. These variations are influenced by the relative abundance of gold and silver mines and the different uses to which the metals are put. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the relative values of gold and silver have changed over time, particularly after the discovery of American mines, and how this affects their use in different economic functions. + +## Economic Domain + +Exchange + +--- +--- ENTITY: precious metals consumption --- + +# Precious Metals Consumption + +## Definition + +The use of gold and silver in various forms including coin, plate, jewelry, and industrial applications. This consumption creates ongoing demand for newly mined precious metals to replace losses from wear, damage, and industrial use. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the consumption of precious metals in various forms creates a continuous demand that must be met by new production, affecting their long-term value and availability. + +## Economic Domain + +Consumption + +--- +--- ENTITY: annual consumption of metals --- + +# Annual Consumption of Metals + +## Definition + +The total amount of gold and silver used up each year through wear, damage, industrial processes, and other forms of consumption that remove these metals from circulation or usable form. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the annual consumption of precious metals must be balanced by new production to maintain stable supplies, and how this consumption affects their long-term value. + +## Economic Domain + +Consumption + +--- +--- ENTITY: mine fertility --- + +# Mine Fertility + +## Definition + +The productivity of a mineral mine in terms of the quantity of valuable material that can be extracted per unit of labor and capital invested. Mine fertility varies significantly between different mines and affects the price and rent of the extracted minerals. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith uses the concept of mine fertility to explain why the rent component in mineral prices is typically lower than in agricultural products, as mineral deposits are generally more abundant and less geographically concentrated than fertile agricultural land. + +## Economic Domain + +Production + +--- +--- ENTITY: mine situation --- + +# Mine Situation + +## Definition + +The geographical location of a mineral mine and its accessibility to markets and transportation infrastructure. Mine situation can significantly affect the cost of production and the price that can be obtained for the extracted minerals. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that for mineral extraction, the situation of the mine is often more important than its fertility in determining profitability, as transportation costs can significantly affect the competitiveness of mineral products in distant markets. + +## Economic Domain + +Production + +--- +--- ENTITY: landlord's share --- + +# Landlord's Share + +## Definition + +The portion of the total produce from land that goes to the landlord as rent, distinct from the portions that go to the farmer as profit and to laborers as wages. The landlord's share increases with the productivity of the land and the efficiency of cultivation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the landlord's share of agricultural produce is determined by the surplus value created by the land after all necessary costs of production have been met, and how this share varies with different types of land and agricultural practices. + +## Economic Domain + +Distribution + +--- +--- ENTITY: farmer's profit --- + +# Farmer's Profit + +## Definition + +The return to the agricultural entrepreneur for the use of capital and management in farming operations. This profit must be sufficient to compensate for the risk and effort involved in cultivation and to provide a return comparable to other forms of investment. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith analyzes how farmers' profits are determined by the productivity of the land and the efficiency of cultivation, and how these profits must be sufficient to maintain and improve the stock employed in agriculture. + +## Economic Domain + +Distribution + +--- +--- ENTITY: agricultural stock --- + +# Agricultural Stock + +## Definition + +The capital invested in farming operations, including livestock, implements, seeds, and other materials necessary for cultivation. This stock must be maintained and renewed to ensure continued agricultural production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how the maintenance and improvement of agricultural stock is essential for continued productivity and how the returns from farming must be sufficient to maintain this stock while providing profits to the farmer and rent to the landlord. + +## Economic Domain + +Production + +--- +--- ENTITY: labouring cattle --- + +# Labouring Cattle + +## Definition + +Animals used for agricultural work, particularly oxen and horses that pull plows and perform other farm tasks. The cost of maintaining labouring cattle is a significant component of agricultural expenses. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how the cost and availability of labouring cattle affect agricultural productivity and how improvements in cattle breeding and feeding can increase the efficiency of farming operations. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural improvement --- + +# Agricultural Improvement + +## Definition + +Enhancements to farming practices and land productivity through better cultivation techniques, crop rotation, drainage, fencing, and other methods that increase the yield and value of agricultural land. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural improvements increase land productivity and rents, and how the benefits of these improvements are distributed between landlords, farmers, and consumers. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural cultivation --- + +# Agricultural Cultivation + +## Definition + +The practice of preparing and using land for growing crops and raising livestock. Cultivation includes all activities from soil preparation to harvest and requires significant labor and capital investment. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how different levels of cultivation affect land productivity and rents, and how the extension of cultivation influences agricultural prices and the distribution of economic returns. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural surplus --- + +# Agricultural Surplus + +## Definition + +The excess produce from agricultural land beyond what is required to maintain the farmers, laborers, and livestock necessary for cultivation. This surplus forms the basis for rent payments to landlords and supports non-agricultural economic activities. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith argues that rent is fundamentally based on agricultural surplus, as it represents the portion of production that remains after all necessary costs of cultivation have been met. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural demand --- + +# Agricultural Demand + +## Definition + +The market demand for agricultural products, which determines the prices that farmers can obtain for their produce and consequently affects the rents that agricultural land can command. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how changes in agricultural demand, whether from population growth, changes in consumption patterns, or improvements in transportation, affect agricultural prices and rents. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural supply --- + +# Agricultural Supply + +## Definition + +The quantity of agricultural products available in the market, determined by the extent of cultivation, weather conditions, and other factors affecting production. Agricultural supply directly influences market prices and rents. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how variations in agricultural supply, whether from seasonal conditions or longer-term changes in cultivation practices, affect agricultural prices and the distribution of economic returns. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural productivity --- + +# Agricultural Productivity + +## Definition + +The efficiency with which agricultural land produces crops and livestock, typically measured as output per unit of land or per unit of labor. Agricultural productivity is a key determinant of land rents and agricultural profits. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in agricultural productivity through better techniques and technologies increase land rents and reduce the real cost of food, supporting broader economic development. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural efficiency --- + +# Agricultural Efficiency + +## Definition + +The effectiveness with which agricultural resources are used to produce desired outputs, including the optimal allocation of land, labor, and capital in farming operations. Agricultural efficiency affects both productivity and profitability. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements in agricultural efficiency through better management and technology increase the surplus available for rent and support economic growth. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural technology --- + +# Agricultural Technology + +## Definition + +The tools, techniques, and methods used in farming operations, including implements, crop varieties, cultivation practices, and management systems. Agricultural technology determines the productivity and efficiency of agricultural production. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in agricultural technology increase productivity and rents, and how the adoption of new technologies varies with economic conditions and market incentives. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural market integration --- + +# Agricultural Market Integration + +## Definition + +The degree to which different agricultural markets are connected through trade and transportation, allowing prices to equalize across regions and enabling more efficient allocation of agricultural resources. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how improvements in transportation and trade integration affect agricultural markets, enabling regions to specialize in their most productive activities and increasing overall economic efficiency. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural specialization --- + +# Agricultural Specialization + +## Definition + +The concentration of agricultural production on specific crops or livestock that are best suited to local conditions, enabled by market integration and transportation improvements. Agricultural specialization increases productivity and economic efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural specialization, facilitated by market integration, allows regions to focus on their most productive activities and increases overall economic efficiency and productivity. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural comparative advantage --- + +# Agricultural Comparative Advantage + +## Definition + +The relative efficiency with which different regions can produce various agricultural products, determined by natural conditions, accumulated knowledge, and existing capital investments. Agricultural comparative advantage guides the international division of labor in farming. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how different regions have natural advantages for producing different agricultural products, and how market forces guide the specialization of agricultural production to maximize overall efficiency. + +## Economic Domain + +Production + +--- +--- ENTITY: agricultural trade --- + +# Agricultural Trade + +## Definition + +The exchange of agricultural products between different regions or countries, enabled by transportation infrastructure and market institutions. Agricultural trade allows regions to access products they cannot efficiently produce themselves. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural trade affects domestic agricultural markets, influences land rents, and contributes to overall economic development by enabling regions to specialize according to their comparative advantages. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price mechanism --- + +# Agricultural Price Mechanism + +## Definition + +The market process through which agricultural prices are determined by the interaction of supply and demand, signaling information about scarcity and abundance to producers and consumers. Agricultural price mechanisms guide resource allocation in farming. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price mechanisms function to allocate resources efficiently, though he notes that government interventions like bounties and price regulations can distort these mechanisms and reduce economic efficiency. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price regulation --- + +# Agricultural Price Regulation + +## Definition + +Government interventions in agricultural markets aimed at controlling prices through mechanisms such as price floors, ceilings, or stabilization schemes. Agricultural price regulation can affect production incentives and market efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines various forms of agricultural price regulation, including the Statute of Labourers and the Assize of Bread and Ale, arguing that such interventions often reduce economic efficiency and harm the interests they aim to protect. + +## Economic Domain + +Regulation + +--- +--- ENTITY: agricultural price stability --- + +# Agricultural Price Stability + +## Definition + +The degree to which agricultural prices remain relatively constant over time, unaffected by short-term fluctuations in supply or demand. Agricultural price stability can be pursued through various policy interventions and market mechanisms. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses the desirability and feasibility of agricultural price stability, arguing that attempts to stabilize prices often create more problems than they solve and that market-determined prices better serve long-term economic interests. + +## Economic Domain + +Regulation + +--- +--- ENTITY: agricultural price volatility --- + +# Agricultural Price Volatility + +## Definition + +The degree to which agricultural prices fluctuate over time due to changes in supply, demand, weather conditions, and other factors affecting production and consumption. Agricultural price volatility can create uncertainty for producers and consumers. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines the causes and consequences of agricultural price volatility, arguing that while short-term fluctuations can be disruptive, long-term price trends reflect fundamental economic conditions and should not be artificially suppressed. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price discovery --- + +# Agricultural Price Discovery + +## Definition + +The process by which market prices for agricultural products are established through the interaction of buyers and sellers, reflecting information about supply, demand, and production costs. Agricultural price discovery enables efficient resource allocation. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price discovery functions in different market conditions and how government interventions can interfere with this process, reducing the efficiency of agricultural markets. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price transmission --- + +# Agricultural Price Transmission + +## Definition + +The process by which price changes in one agricultural market or region affect prices in other markets, facilitated by trade and transportation. Agricultural price transmission enables markets to respond to changes in supply and demand conditions. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how improvements in transportation and market integration affect agricultural price transmission, enabling more efficient resource allocation and reducing regional price disparities. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price discrimination --- + +# Agricultural Price Discrimination + +## Definition + +The practice of charging different prices for the same agricultural product in different markets or to different customers, based on their willingness or ability to pay. Agricultural price discrimination can increase seller profits but may reduce economic efficiency. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses how agricultural price discrimination occurs in different markets and how transportation costs and market conditions affect the ability of sellers to practice price discrimination. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price elasticity --- + +# Agricultural Price Elasticity + +## Definition + +The responsiveness of agricultural supply and demand to changes in prices, measured as the percentage change in quantity supplied or demanded divided by the percentage change in price. Agricultural price elasticity affects how markets respond to price changes. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines how agricultural supply and demand respond to price changes over different time periods, noting that supply is typically less elastic in the short run due to the biological constraints of agricultural production. + +## Economic Domain + +Exchange + +--- +--- ENTITY: agricultural price floors --- + +# Agricultural Price Floors + +## Definition + +Minimum prices set by government for agricultural products, typically above market equilibrium levels, intended to support producer incomes. Agricultural price floors can lead to surpluses and market inefficiencies. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith discusses various forms of agricultural price support, including the bounty on grain exports, arguing that such interventions often create more problems than they solve and reduce overall economic efficiency. + +## Economic Domain + +Regulation + +--- +--- ENTITY: agricultural price ceilings --- + +# Agricultural Price Ceilings + +## Definition + +Maximum prices set by government for agricultural products, typically below market equilibrium levels, intended to protect consumer interests. Agricultural price ceilings can lead to shortages and reduced quality. + +## Source Chapter + +Book I, Chapter 11 + +## Context + +Smith examines historical examples of agricultural price ceilings, including the Statute of Labourers, arguing that such interventions often harm the very groups they aim to protect and reduce economic efficiency. + +## Economic Domain + +Regulation + + + +## VSM Framework Reference + +--- +id: vsm-framework +name: vsm_framework +artifact_type: content +description: Stafford Beer's Viable System Model reference for economic analysis +version: 1.0.0 +--- + +# Stafford Beer's Viable System Model (VSM) + +The Viable System Model (VSM) is a model of the organisational structure of any +autonomous system capable of producing itself. It was created by management +cybernetician Stafford Beer in his books *Brain of the Firm* (1972) and +*The Heart of Enterprise* (1979). + +## Core Principle: Viability + +A viable system is any system organised in such a way as to meet the demands +of surviving in a changing environment. One of the prime features of systems +that survive is that they are adaptable. The VSM expresses a model for a +viable system, which is an abstracted cybernetic description applicable to +any organisation that is a going concern. + +## The Five Systems + +### System 1 (S1) — Operations + +The primary activities that produce the organisation's purpose. These are the +operational units that directly create value. Each operational element is itself +a viable system (the principle of recursion). + +**In economic terms:** Productive enterprises, factories, farms, workshops, +individual labourers performing specialised tasks, merchant operations. + +**Key properties:** Autonomy within constraints, self-organisation, +direct engagement with the environment. + +### System 2 (S2) — Coordination + +The information channels and bodies that allow the primary activities in +System 1 to communicate with each other and that allow System 3 to monitor +and coordinate activities. System 2 dampens oscillations and resolves +conflicts between operational units. + +**In economic terms:** Market price mechanisms, trade customs, standard +weights and measures, commercial law, banking clearinghouses, trade guilds. + +**Key properties:** Anti-oscillatory, dampening, scheduling, conflict +resolution, standardisation. + +### System 3 (S3) — Control / Operational Management + +The structures and controls that establish the rules, resources, rights, +and responsibilities of System 1 and provide an interface between Systems 1 +and Systems 4/5. System 3 represents the day-to-day control of the +organisation. It optimises the internal environment. + +**In economic terms:** Government regulation of trade, taxation policy, labour +laws, enforcement of contracts, the "invisible hand" as emergent internal +regulation, guilds and corporations governing members. + +**Key properties:** Internal regulation, resource allocation, accountability, +synergy extraction, performance management. + +### System 3* (S3*) — Audit / Monitoring + +The audit and monitoring channel that allows System 3 to verify information +coming from System 1 through channels other than those provided by System 2. +System 3* provides sporadic, direct access to operational reality. + +**In economic terms:** Market inspections, quality checks, auditing of accounts, +surprise investigations into trade practices, verification of weights and measures. + +**Key properties:** Sporadic direct investigation, reality checking, bypassing +normal reporting channels. + +### System 4 (S4) — Intelligence / Adaptation + +The bodies and processes that look outward to the environment to monitor +how the organisation needs to adapt to remain viable. System 4 captures +all relevant information about the outside-and-then environment. It is +responsible for strategic responses. + +**In economic terms:** Foreign intelligence about trade opportunities, +market research, new technology adoption, colonial exploration and trade +route development, understanding of foreign economic systems. + +**Key properties:** Environmental scanning, future orientation, strategic +planning, modelling, research and development. + +### System 5 (S5) — Policy / Identity + +The policy-making body that balances demands from Systems 3 and 4 and defines +the identity, values, and purpose of the organisation. System 5 provides +closure to the whole system and represents its supreme authority. + +**In economic terms:** Sovereign authority, constitutional principles governing +economic policy, national economic identity, the philosophical foundations +of economic systems (mercantilism vs. free trade), the overarching purpose +of the commonwealth. + +**Key properties:** Identity, ethos, supreme command, policy closure, +balancing internal and external perspectives. + +## Key Concepts + +### Recursion + +Every viable system contains and is contained in a viable system. The same +five-system structure recurs at every level of organisation. A workshop is +a viable system within a factory, which is a viable system within an +industry, which is a viable system within a national economy. + +### Variety + +A measure of the number of possible states of a system. The Law of Requisite +Variety (Ashby's Law) states that only variety can absorb variety. A +controller must have at least as much variety as the system it controls. + +### Requisite Variety + +The principle that for effective regulation, the variety of the regulator +must match the variety of the system being regulated. This is achieved +through variety attenuation (reducing the variety coming up from operations) +and variety amplification (increasing the variety of management's responses). + +### Attenuation and Amplification + +Variety engineering mechanisms. Attenuation reduces variety (e.g., reporting +summaries, statistical aggregation, standardisation). Amplification increases +variety (e.g., delegation, empowerment, decentralisation). + +### Algedonic Signals + +Emergency signals that bypass the normal management hierarchy to alert +higher systems of critical situations requiring immediate attention. Named +from the Greek words for pain (algos) and pleasure (hedone). + +**In economic terms:** Market panics, famine signals, sudden price collapses, +trade embargoes, economic crises that demand immediate sovereign intervention. + +### Autonomy + +The degree of freedom granted to operational units (System 1) to self-organise +within constraints set by System 3. Beer argued that maximum autonomy +consistent with systemic cohesion yields maximum viability. + +### Viability + +The capacity of a system to maintain a separate existence and survive in a +changing environment. A viable system continuously adapts while maintaining +its identity. + + +## Mapping Guidelines + +--- +id: mapping-rules +name: mapping_rules +artifact_type: content +description: Guidelines for mapping economic entities to VSM concepts +version: 1.0.0 +--- + +# VSM Mapping Rules + +## Mapping Principles + +1. **Ground in Beer's definitions.** Every mapping rationale must reference + the specific VSM system function, not just a superficial resemblance. + +2. **Prefer structural over metaphorical mappings.** A mapping is strong + when the economic entity performs the same *functional role* in Smith's + economic system as the VSM component performs in an organisation. + +3. **Allow multiple mappings.** A single economic entity may map to + multiple VSM systems. For example, "the sovereign" may map to both + S3 (regulation) and S5 (policy). Create separate mapping documents + for each relationship. + +4. **Respect recursion.** Consider at which level of recursion the mapping + applies. The division of labour within a single workshop (S1-level) + differs from the division of labour across an entire national economy + (higher recursion level). + +## Mapping Strength Criteria + +### Strong +- The entity directly performs the function of the VSM system. +- The mapping would be recognisable to a VSM practitioner without explanation. +- Example: "market price mechanism" → S2 (Coordination) — prices coordinate + supply and demand between producers. + +### Moderate +- The entity partially performs the function or performs it in a limited context. +- The mapping requires some argument but is defensible. +- Example: "merchant" → S4 (Intelligence) — merchants gather information + about foreign markets, but this is not their primary function. + +### Weak +- The mapping is speculative or metaphorical rather than structural. +- The connection exists but requires significant interpretive work. +- Example: "moral sentiments" → S5 (Policy) — broad ethical framework + shapes economic behaviour, but the connection is indirect. + +## What NOT to Map + +- Do not force mappings where none exist. It is valid for an entity to have + no clear VSM mapping — flag it with "Mapping Strength: Weak" and explain + the difficulty. +- Do not map purely descriptive/historical content that lacks functional + significance. + +## VSM System Checklist + +When mapping, consider each system: + +| System | Question to Ask | +|--------|----------------| +| S1 | Does this entity directly produce value or output? | +| S2 | Does this entity coordinate between operational units? | +| S3 | Does this entity regulate internal operations? | +| S3* | Does this entity provide audit or verification? | +| S4 | Does this entity scan the environment or plan for the future? | +| S5 | Does this entity define identity, policy, or purpose? | + +Also consider the key concepts: +- **Recursion**: At what level does this entity operate? +- **Variety**: Does this entity manage variety (attenuate or amplify)? +- **Algedonic signals**: Does this entity serve as an emergency signal? +- **Autonomy**: Does this entity relate to operational autonomy? + + +## Instructions + +1. Review each extracted economic entity carefully. +2. For each entity, determine which VSM system(s) it most closely relates to. +3. Produce a mapping document for each entity-VSM relationship following + the VSM Mapping Schema v1.0. +4. Each mapping document must include: + - An H1 heading in the format "Entity Name -> VSM Concept Name" + - An Economic Entity Reference section + - A VSM Concept Reference section + - A Mapping Rationale section (minimum 30 words) grounded in Beer's definitions + - A Mapping Strength section rated as Strong, Moderate, or Weak +5. Where an entity maps to multiple VSM systems (recursion), create + separate mapping documents for each relationship. +6. Flag entities that don't clearly map to any VSM concept with a + "Mapping Strength: Weak" and note the difficulty in the rationale. + +## Output Format + +Output each mapping as a separate markdown document, delimited by +`--- MAPPING: -to- ---` markers. diff --git a/examples/infospace-with-history/output/metrics/history.yaml b/examples/infospace-with-history/output/metrics/history.yaml index 654bd0a3..58719bf6 100644 --- a/examples/infospace-with-history/output/metrics/history.yaml +++ b/examples/infospace-with-history/output/metrics/history.yaml @@ -310,3 +310,29 @@ concern: C1 metadata: source: collection-checks +- snapshot_id: 9dcb9141 + created_at: '2026-02-19T17:59:36.831759+00:00' + schema_name: default + entity_count: 271 + entity_evaluations: [] + collection_metrics: + - name: coherence_components + value: 0.0 + concern: C3 + - name: consistency_cycles + value: 0.0 + concern: C4 + - name: coverage_ratio + value: 0.525 + concern: C2 + - name: granularity_entropy + value: 2.8082334499585753 + concern: C5 + - name: modularity + value: 0.0 + concern: C3 + - name: redundancy_ratio + value: 0.007380073800738007 + concern: C1 + metadata: + source: collection-checks diff --git a/examples/infospace-with-history/output/metrics/metrics.yaml b/examples/infospace-with-history/output/metrics/metrics.yaml index 48640dad..1ca4ca8b 100644 --- a/examples/infospace-with-history/output/metrics/metrics.yaml +++ b/examples/infospace-with-history/output/metrics/metrics.yaml @@ -1,6 +1,6 @@ coherence_components: 0.0 consistency_cycles: 0.0 -coverage_ratio: 0.513889 -granularity_entropy: 2.772108 +coverage_ratio: 0.525 +granularity_entropy: 2.808233 modularity: 0.0 -redundancy_ratio: 0.008475 +redundancy_ratio: 0.00738 diff --git a/examples/infospace-with-history/output/processing-log.yaml b/examples/infospace-with-history/output/processing-log.yaml index 8d9ff91c..283d075c 100644 --- a/examples/infospace-with-history/output/processing-log.yaml +++ b/examples/infospace-with-history/output/processing-log.yaml @@ -316,3 +316,44 @@ finish_reason: stop duration_seconds: 78.1 error: null +- source_id: book-1-chapter-11 + processed_at: '2026-02-19T18:19:20Z' + provider: openrouter + model: arcee-ai/trinity-large-preview:free + success: true + total_prompt_tokens: 158734 + total_completion_tokens: 18928 + total_cost: 0.0 + total_duration_seconds: 1179.5 + total_retries: 0 + stages: + - stage: extract-entities + retries: 0 + provider: openrouter + model: arcee-ai/trinity-large-preview:free + prompt_tokens: 67826 + completion_tokens: 6611 + cost: 0.0 + finish_reason: stop + duration_seconds: 422.2 + error: null + - stage: map-to-vsm + retries: 0 + provider: openrouter + model: arcee-ai/trinity-large-preview:free + prompt_tokens: 8737 + completion_tokens: 10000 + cost: 0.0 + finish_reason: length + duration_seconds: 632.8 + error: null + - stage: synthesize-analysis + retries: 0 + provider: openrouter + model: arcee-ai/trinity-large-preview:free + prompt_tokens: 82171 + completion_tokens: 2317 + cost: 0.0 + finish_reason: stop + duration_seconds: 124.5 + error: null