866 B
866 B
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