The Online Library of Liberty

A project of Liberty Fund, Inc.

• Preface.
• Lecture I.
• Lecture II.
• Lecture III.
• Lecture IV.
• Lecture V.
• Lecture VI.
• Lecture VII.
• Lecture VIII.
• Lecture IX.
• Lecture X.
• Lecture XI.
• Appendix.
• Note On Page 32.
• Page 37.
• Page 39.
• Page 57.
• Page 65.
• Page 133.
• Page 145.
• Page 149.
• Page 164.
• Page 175.
• Page 183.
• Page 203.
• Page 223.

LECTURE VII.

Gentlemen,—

In my last lecture I attempted to give an explanation of the manner in which, as population increases, inferior soils must be brought into cultivation, and the soils already cultivated must be forced, at a greater proportional expense, to yield a greater produce. I have shewn that rent has therefore a tendency to increase as population increases, and that the natural price of corn, or its cost of production, may be measured independently of rent; that it will be equal to the cost of raising it on that land which pays no rent, or to the cost of production of that portion which is raised under the most naturally disadvantageous circumstances. I shall to-day endeavour to prove this theory of rent, to free it from objections, and to point out the consequences to which it leads.

I believe, indeed, that some of the objections made to this theory are caused by the manner in which it is sometimes stated. It is said that rent is caused by the existence of land of different degrees of fertility, and that nothing but the cultivation of inferior soils will produce rent. Now such statements are not correct. Rent is not caused by the cultivation of inferior soils. It is caused immediately by the high prices, which occasion a great part of the produce of the earth to sell for more than the cost of raising it. These high prices are caused by the necessity of resorting to inferior soils, for the purpose of producing some part of the required supply. But if those inferior soils did not exist, or were left uncultivated, prices would be still higher, as the supply would be still scantier, until those high prices would call inferior soils into cultivation. In short, high prices are the cause, and the cultivation of inferior soils the effect. This extended cultivation has the effect of reducing prices, although it cannot reduce the price below the cost of production on those soils, since without such a price, those soils will not be cultivated. The highest limit beyond which the price of corn cannot permanently rise, is determined by the fertility of the next inferior soil, not yet under cultivation, or by the cost of forcing the richer soils to yield permanently a more abundant produce. The existence and cultivation of those inferior soils do not produce rent, but they regulate it, and set a limit to it, and prevent the proprietors of richer land from having such a monopoly as they would otherwise possess.

These three causes therefore may be said to regulate and produce prices and rent. 1st. The supply of land being limited. 2nd. The different degrees of fertility of different soils. 3rd. The power which land has of yielding a greater produce, provided an additional quantity of labour and capital be applied to its cultivation; this increase of expense however, bearing to the preceding outlays a greater proportion than the increase of produce obtained by its means will bear to the preceding total amount of produce. Of these causes it is to be observed, that the first alone would be sufficient to produce rent. If all lands were of equal fertility, and up to their highest point of cultivation, yielded a produce exactly proportional to the expense of raising it, still prices might rise so high as to enable land to yield a rent. Whatever is useful, and is limited in quantity, is capable of possessing value, if it can be made the subject of exchange; and it will be valuable if the quantity is less than what could be consumed, even if every man were to get as much as he desired gratuitously. But if this were the case, the laws which regulate rent and prices would be very different from what we perceive them in fact to be. In such a case, prices would not rise above the cost of production, nor would rent exist until all the land in the country was tilled up to its highest point of cultivation, and bore as much as it was capable of producing. And when the total produce of the country became insufficient, then the price of corn would rise above the cost of production, and rent would begin to exist.

This can be easily proved. Let all the land in the country be capable of yielding, year after year, one measure of corn per acre, to a certain expense of cultivation, and be capable of having its produce increased proportionally to the expense of cultivation, up to ten measures; and let an average production of five measures per acre be sufficient to satisfy the wants of the community. Under these circumstances, rent cannot exist. If a man took a farm of 100 acres, at one shilling an acre rent, and raised five measures per acre, he would have a greater net profit by giving up half his farm, and transferring the labour and capital to the other half, on which he would then raise ten measures per acre, or 500 measures in all, with the same expense of cultivation, and half the rent that it cost before. Whatever theory of rent is adopted, this general principle should be carefnlly borne in mind, that agricultural produce cannot sell for more than its cost of production, as long as there exist ample unemployed means of raising further produce at the same cost.

The existence of the second and third cause which I mentioned to you as producing and regulating rent, is indicated by the fact, that a permanent increase of prices has been constantly attended with an increased production, and that rent existed when but a very small portion of the present supply of corn was raised within the kingdom. The slightest observation is sufficient to convince any one, that in almost every farm in Ireland more corn could be produced, if a greater amount of labour and capital was expended in its cultivation. But although such additional expenditure would produce some return, yet that return, with the present price of corn, might not be sufficient to repay the outlay. But if the wants of an increasing population could not be supplied without such expensive cultivation, then corn would necessarily rise to such a price as to indemnify the farmer who effected it.

This theory of rent may be said to consist of two propositions. First, that the rent of land depends upon its fertility and situation, and upon the price of agricultural produce. Secondly, that the cost of production, or natural price of agricultural produce, depends upon and is regulated by the expense of producing that portion which is raised with the greatest amount of labour. Those two propositions are, I believe, almost universally admitted, although some of the consequences that necessarily result from them are frequently disapproved of, and alleged experience is brought forward against them. As for example, in the investigation of the effects which would follow if all the lands in the kingdom were to have their fertility doubled, or by any improvement in agriculture could be made to yield double the quantity of produce at the same expense as it now yields its present amount. This would diminish rents, for as this double quantity of corn, &c. would not be required, the inferior soils would be left uncultivated, and the rent of the better soils, being the difference between their produce and that of the worst soils actually cultivated, would undergo a corresponding diminution.

This startles some, and they cry, do you infer that agricultural improvements are injurious to the landlord, and diminish his rent? That is contrary to all experience. This argument does not apply to the supposition against which it is directed, and there is a mixture of truth and falsehood in it. But the real state of the case may be easily ascertained. Improvements in agriculture do not spread suddenly and generally through the kingdom. The farmers who adopt them first, reap a great advantage from them, since the increased quantity of produce which they thus obtain is (in consequence of the improvement not being in general use) not counterbalanced by a corresponding reduction of price. Indeed, the decrease of price occasioned by an improvement which only a few persons adopt, is almost imperceptible; and as the improvement comes into general use, the increase of population creates a sufficient demand for the additional quantity of food thus provided, and thereby keeps rent up to, or even raises it beyond its former level. But primary and secondary causes and effects ought not to be confounded. The first and primary result of the universal adoption of an improved system of agriculture, would certainly be a general reduction of rent. Some idea of this may be formed by observing the effect which a very abundant harvest sometimes has upon the condition of the farmer. He suffers more by the fall of price, than he gains by the abundance of his crops. A succession of such harvests would ruin him, or compel him not to cultivate so highly, and this would equally diminish the competition for land, and produce a reduction of prices and of rents. Now, agricultural improvements just give the means of producing such abundant supplies every year, and if generally introduced, would, with the present high rents and extended cultivation, entail certain ruin upon the farmers. Ultimately such an increase of population might take place as to raise rents even above their former level. But this secondary and contingent effect cannot be confounded with the primary and immediate effect, without much confusion of thought and language. It is accurately true to say, that the first effect of the universal adoption of an improved system of agriculture, would be to lower rents; and that it would have at the same time a tendency to create such an increase of population as would ultimately restore rent to, or even raise it above, its former level. What should we reply to a man who should contend that a brisk trade would impoverish the workman, and should defend his opinion by saying that a brisk trade would produce high wages, and thus render the workman indolent and extravagant. We should request him to distinguish between the necessary primary effect and the contingent remote effect, and we should say that the high wages would, in the first instance, have a tendency to enrich the workman, and that according to his intellectual and moral education, the ultimate effect might be, increased exertion and judicious expenditure, or idleness and extravagance. We shall meet with many instances of this species of confusion in Political-Economy, especially in cases where the principle of population, as it is called, is made use of as the intermediate step between the primary and the secondary effects. With respect to improvements in agriculture, I believe it is quite clear that rent in America would not now be so low as it is, if the system of agriculture there were in the same rude state in which it was in this country 200 years ago, when population was proportionally thin.

To improvements in agriculture it is principally owing that corn is not constantly and rapidly increasing in price. But its cost of production is not increasing, because the increased expense arising from the necessity of resorting to inferior lands, or of compelling the soils already in cultivation to yield a greater produce, has hitherto been obviated by the gradual spread of increased skill. I believe that without any new discoveries, but merely by bringing into general use what is already known, that Ireland could raise nearly double the produce which is yielded at present, without materially increasing the cost of production, or natural price of provisions. This would give support to a proportional increase of population, and in the mean time many improvements would probably be made, and brought partially into use. Such partially adopted improvements may be considered as resources on which an increasing population may draw as their wants increase. The slowness with which agricultural knowledge spreads, has the effect of preventing every improvement from being attended with the immediate ruin of all farmers, who, at the time of their introduction, might happen to hold land under leases which they were unable to surrender. The fallacy of those who appeal to experience to prove that it is absurd to suppose that rents can possibly be reduced in consequence of agricultural improvements, lies in this, that the universal introduction of an improvement is an imaginary case: what the immediate effect would be, can be ascertained only by reasoning. According to the theory of rent which I have been explaining, its effect would be different from that of the gradual spread of improvement; and yet that such would be the supposed effect, is urged as an objection to the theory, because experience shews that the gradual spread of improvement has not that effect.

It is also said that this theory must be false, for experience shews that there never was a country in which, for the best and most fertile land at least, some rent has not been paid; whereas if the theory were true, there would have been in every country a certain period, during which rent would have been unknown, viz. that period during which all the wants of the inhabitants can be satisfied with the corn produced at the cheapest cost of production, that is, by the first and least application of capital to land of the greatest fertility. This objection is a fair one, and certainly requires an answer. In the first place then, this theory of rent is brought forward only to explain the causes which determine farmers’ rents on the system in which they are demanded in these countries, where the land is let to the tenant as the result of a contract which either party may enter into as he thinks proper, and where the amount of rent is a fixed sum, not dependent upon the success of the tenant in raising great or scanty crops. Hence no objections to this theory can be drawn from the examples of those countries where contracts of this nature are not freely made. The theory in question does not pretend to determine what amount the serf or slave, who is compelled to till the soil, can be forced to give to his lord or task-master. It only determines the sum which a tenant will pay, who is free to take land or not, as he thinks proper, and who need not take any land, unless by doing so he can obtain the same remuneration for his labour and capital as if he devoted them to any other employment. Such a state of things has seldom existed at the beginning of any society, and therefore experience can scarcely be appealed to, except in the case of some modern colonies, when it strongly corroborates this theory. Indeed such corroboration is so strong, that the theory itself has been objected to, as if it were founded on a partial induction, drawn solely from observation of the modern settlements in America and New Holland.

But even in these there are some circumstances which might mislead a careless observer, as rent, or a small sum to purchase the fee simple, appears to have been paid at the very commencement for land. Such sums however have been very small in amount, and partake more of the nature of an acknowledgment to the Sovereign, than of rent to be paid out of the profits of the soil. In such cases too, both the buyers and the sellers had in their consideration the increase of value which they anticipated their lands would receive with the progress of colonization. This diminished the supply and increased the demand. In many cases the purchasers were content to forego all immediate advantage from all, or from a great part of their purchases, and to wait contentedly for the increased value which they knew their land would derive from the progress of colonization, independently of any exertions or expenses on their part. In many cases also, those who derived land from the gift of the crown, were by the same considerations prevented from bringing them into market for sale, and though they would gladly set them on lease, they could not find a tenant to pay rent for them. Such land could not yield a rent, because corn would not be worth more than the cost of production on them. But the fee simple might be sold, and would procure some slight sum, in consideration of the rent, which all parties knew it would be worth at some future period. Besides, the habits and feelings which the settlers brought with them from the old world, had much influence on those transactions. The colonists had been in the habit of considering landed property as equivalent to wealth and dignity, and could not readily reconcile themselves to the idea that a man might be very poor, and yet possess an unencumbered fee-simple estate of great extent and fertility. When they bought a tract of land very cheap, they imagined that they had obtained a great prize, and in general they purchased more than they would have done if they had made more prudent calculations, and in consequence they frequently accumulated wealth less rapidly than they would have done if they had been contented with smaller estates. But in consequence of the great demand for labour, and the high rate of profits, their wealth increased in spite of these miscalculations. The natural sources of their prosperity, counteracted their errors. Where the labour of a single man, well directed in agriculture, is worth £100 a year, and where the rate of profits is 15 or 20 per cent, and provisions cheap, it is difficult for an industrious and economical family to avoid acquiring at least a competence. Though I believe the speculation of purchasing and clearing lands in the back settlements, seldom succeeded with those who did not contribute their own exertions to the task.

With respect to all rents, which merely give the landlord a certain portion of the produce, these may be paid even in the earliest stage of society, while much of the best land still remains unoccupied. These can be paid, as they add to the price of corn by increasing the cost of production. Such rents existing in the form of a proportion of the produce, may exist in the early stages of society, but they impede the progress of cultivation, and as soon as they are partially abolished, they fall quickly into total disuse. Tenants and landlords find it then for their interests to exchange them for a fixed composition. Practically such a form of rent has not existed for centuries. Tithes have long ceased to be exactly proportional to the produce. If an exact tenth of the produce had been universally paid, the partial introduction of tithe compositions would have had a curious effect. It would have ruined the farmers in parishes where the composition did not take place, and in other cases it would have transferred a tax from the consumer to the landlord. As the analysis by which such consequences can be proved is, in the present state of things, more curious than useful, I shall not take up your time with it.

But besides the objection drawn from the best land not being rent free in new settlements, it is urged that there ought, if the theory were true, to be some land in our own countries cultivated rent free, as the worst soil taken into cultivation, it is said, does not pay rent: and it is said, there is no such land, therefore the theory is false. Here both the assertion and the argument are erroneous. There is such land, and even if there were not, the theory might be true. There is not, it is true, much land in cultivation which appears to pay no rent, but this apparent non-existence of such land is caused by several circumstances. That there is such land as would repay by its produce the expense of cultivation, and yet would not enable the tenant to pay any rent, might be conjectured from this fact, that there is much land so bad, as at the present price of corn, it would not even pay the expense of cultivating it. There is also land which yields a very considerable rent. There are, apparently, all intermediate degrees, and therefore it is probable that there exists some land of that particular degree of fertility which would just repay the expense of cultivation, exclusive of rent. Such land may sometimes appear to pay a rent, by forming part of a farm where either a gross rent is paid for the entire, or a certain sum per acre for all, rich and poor, letting the inferiority of some be compensated by the fertility of other parts, and thus the farmer may appear to be paying rent for the bad land, although it is for part of the good land he really pays it. In many cases also, inferior soils require that a considerable expense should be laid out upon them before they will yield any thing. Such expense is not repaid unless by the profits of many years, and therefore a tenant with a short lease could not effect those improvements, even if he got the land for his term rent free. Those improvements are therefore in general effected by the landlord, and the rent which he gets from the tenants is frequently no more than a reasonable profit on the capital expended on the land. In those cases the land may be said to yield no rent. It has been cultivated by the landlord and tenant jointly, and the tenant pays a certain sum to the landlord under the name of rent, but in reality as the profit for the landlord’s advance of capital, not as the annual sum paid for the use of the original inherent powers of the soil. The distinction is not made by the tenant, nor is it important that it should be made, as when the improvements are effected, they are taken into consideration in the value of the land, and are regulated by the same principle as if they had been placed there by nature. What expectation of increased rent will lead to such improvements, is a question depending on the rate of profits. What increase of rent those improvements, when effected, will actually produce, is a question depending upon the laws which regulate and govern rent.

But even if there were no land in cultivation which yielded no rent, the theory I have attempted to explain might not be less true. As the theory does not depend so much upon the varying fertility of different soils, as upon the continually decreasing returns which land will give to successive equal applications of labour and capital, all that is valuable in the theory is contained in these assertions, that at a certain price of agricultural produce, a certain increase of cultivation will produce increased crops, but the increase may not be sufficient to compensate for the increased expense, but that if prices were higher, they would encourage and reward such cultivation; and that there is always a certain portion of labour which exactly produces an equivalent return with usual profits; and that the cost of production of corn, &c. may be measured, exclusively of rent, by the cost of production of that portion which, to satisfy the wants of the country, must be produced under the most disadvantageous natural circumstances. This theory therefore does not require that all lands should admit of a more extended cultivation, or that there should be any land in the kingdom incapable of paying any rent. I therefore cannot agree with Mr. Malthus, in supposing that the rent which the worst land could pay, as pasture land, should be deemed part of the cost of production of corn.

So much of the rent that is at present paid for land is in reality the profit of capital actually expended, that some have thought they could reduce all rent to this source, and failing to make this out satisfactorily, they represent rent as a compensation either for the capital laid out in improvements, or as a compensation for the money actually laid out in the purchase of the land by the landlord, or those from whom he derives his title. I need not take up much of your time with an answer to the latter part of the alternative. The tenant has no concern with the purchase money of the land. Paying a high price for the fee simple will not enable the landlord to procure, or the tenant to pay, a high price for the use of the soil. The purchase money being high, is the effect of rent, not the cause. If land passes through several hands, that does not increase its value, and if all the land in the kingdom was now in the hands of the original proprietors, the same rent might be paid for them as their present owners receive: and although part of the rent of land, and sometimes even the whole, is only the price paid for the use of buildings, drains, fences, and other improvements effected on the land; yet that is not always the case. I have seen farms in Ireland for which a very high rent was paid, although the total value of all the capital expended in improving the land did not amount to half as much as the rent paid for it in a single year. In such lands the rent cannot possibly be looked upon as a compensation or return for the capital expended in effecting improvements upon the land.

Before I conclude this subject, I wish to point out an erroneous argument, to prove the continually decreasing powers of the soil, that is to be found in a very instructive and entertaining book. I allude to Torrens on the production of wealth. I allude to this false argument not merely from an unwillingness to allow you to acquiesce in false reasoning, but because I conceive that some important consequences do result from the facts upon which the argument is founded. To avoid the possibility of misapprehension, I shall quote the very words of that author, whose style in this passage, as well as all through his work, is deserving of much praise for its perspicuity. In page 115, the argument proceeds in those words—“The principle that each additional application of labour and capital to the improvement of land effects a diminished proportional increase, is supported by the direct evidence of facts. When small capitals are laid out upon the soil, and cultivation is conducted in an unexpensive manner, the land proprietor, without trenching upon the farmer’s reasonable profits, often receives half the produce as his rent; but when large capitals are invested in the soil, and the system of high farming is pursued, the proprietor, in order to leave the cultivator a reasonable return on the stock which he employs, must be satisfied to receive as his rent, a third, a fourth, or even a fifth part of the produce. This demonstrates that each additional quantity of produce, is raised at an increased expense. For if one hundred labourers raised, from a given surface, four hundered quarters of wheat, and two hundred of these replaced, with a reasonable profit, the capital which the farmer expended in setting them to work, then the remaining two hundred, or half the produce, might go to rent. And if two hundred labourers could raise eight hundred quarters, or in other words, if a double expenditure occasioned a double produce, then as four hundred quarters would afford the farmer the same return on the capital which employed two hundred labourers, as two hundred quarters had afforded him on the capital which put two hundred labourers in motion, the other four hundred quarters would be disposable; or in other words, one half of the produce of the farm might still be appropriated as rent. It is only because the farmer cannot increase the quantity of produce in the same ratio in which he increases the quantity of work done upon the farm, that the proprietor receives a less proportion of produce as his rent. Where one hundred labourers raised four hundred quarters of wheat, then two hundred labourers could not raise eight hundred quarters, but would raise some less quantity, say seven hundred. Now the half of seven hundred quarters could not be taken as rent, because it requires four hundred to replace, with a reasonable return, the capital which the farmer expended in putting two hundred labourers to work, and therefore only three hundred, or less than the half of the produce, remains as the land proprietor’s portion. In the progress of improvement, the proprietor receives a constantly diminishing proportion of the whole produce, because the whole produce bears a constantly diminishing proportion to the capital which raised it.”

I trust that it is almost unnecessary for me to point out to you the error that pervades the train of reasoning I have just read. It is inconsistent even with the theory of rent adopted by the ingenious author, and here attempted to be proved. It proceeds upon the supposition that 400 quarters is the produce of the last application of labour and capital to land, at a time when 200 quarters is sufficient to pay the labourers employed in raising the 400 quarters, and to give the farmer the usual profits on his advances; and this state of things is supposed to exist before the land has been forced by an equal additional application of labour and capital to yield 300 quarters more. This could never be. It is impossible that land should be capable of yielding 300 quarters, to an application of labour and capital for which 200 quarters would be a sufficient recompense, and yet that such a power should not be made use of. Remember that when labour and capital are applied to land with a diminished proportional return, the cause must always be such a change of circumstances or of prices, as renders this return a sufficient remuneration for advances for which the same return would not formerly have been a sufficient recompense. But Mr. Torrens’s argument proceeds on the supposition that cultivation can be extended, and additional capital laid out with a diminished rate of return, while the same advance of labour and capital requires the same remuneration as before.

This defective argument is resorted to by Mr. Torrens for the purpose of shewing that this admitted fact, viz. that as rent rises in amount, the landlord receives a less proportion of the total produce of the soil, is in itself a sufficient proof that successive applications of labour and capital to land are always attended with diminished returns. Now there is no necessary connexion whatever between those two propositions, and therefore we might reasonably have expected that the train of reasoning employed to prove the existence of such a connexion should be found to be erroneous. What makes such an error the more remarkable is, that all the examples given by writers on Political-Economy, to illustrate what is called the decreasing fertility of the soil, would rather seem to prove that not only the portion but the proportion of the produce received by the landlord is continually increasing. If you will take the trouble of examining the examples given by Ricard’s Principles of Political-Economy, page 56, and of computing in each instance the amount of rent, and the total amount of produce, you will find that the proportion of rent to produce seems continually increasing. And Mr. Senior, in a letter to Lord Howick, page 62, attempted to prove from this system, that rent must increase faster than gross produce. His calculations are however erroneous, being founded on the supposition that the successive soils of decreasing fertility are equal in extent. His calculations covertly assume this, which is unproved, and contrary to the fact. But in fact the landlord’s proportion has been decreasing, and a very important conclusion may be drawn from this circumstance, viz. that the portion of produce which is raised by the last application of labour and capital to land, bears a considerable, and with the progress of population, an increasing ratio to the total amount of produce which was raised before such last application of labour and capital took place. I fear that I have not stated this conclusion in such a manner as to make the vis consequentiæ very clear and intelligible. But I hope that the few following remarks, with a little reflection on your part, may be sufficient to remove all obscurity from the subject. First, it is to be remembered that the capital most productively expended, is not necessarily most productive when referred to its total produce. The total produce depends upon the total amount of capital, and upon its rate of productiveness. Thus, if the rate of productiveness of the first application of capital is equal to a return of thirty-fold, but that the amount of capital which admits of being expended so productively is only equal to £100, then the entire produce of such productive capital will be only £3,000. Now if the capital of the next degree of productiveness gives a return of only twenty-fold, while the entire amount of capital which admits of being expended with the second degree of productiveness is equal to £1,000, then the entire produce of the capital of the second degree of productiveness will be worth £20,000, while that of the capital of the first degree was only £3,000. A similar circumstance may exist with respect to lands of different degrees of fertility. If 100 fields of the most fertile land yield 100 quarters of corn each, and there is no more land in the kingdom of that degree of fertility, the entire produce of such fertile land will be 10,000 quarters. Let a field of equal extent of the next degree of fertility yield to similar cultivation only 80 quarters, but let there be in the country 1,000 fields of such fertility, and the total produce of land of the second degree of fertility will be 80,000 quarters, being equal to four times the produce yielded by land of the first degree. I have given those examples not for the purpose of proving any thing, but to explain the proposition which I am about to prove, viz. that the produce yielded by land of the lowest degree of fertility, or to the last application of capital, not only may be, but actually is, on the whole, greater than that obtained from more fertile lands, or by earlier applications of capital. In what I am about to say, I shall make use of the expression, “resorting to land of a less degree of fertility,” to signify all the different modes in which an additional portion of produce is obtained at an increase of expense, whether that increase of expense is caused by the diminished rate of return from the superior soils, or from the labour and capital being applied to new soil of an inferior quality. Adopting this form of expression, we should say, that as population increases, resort must be had to inferior soils for the necessary supply, and that the amount of soil of the last quality under cultivation is so great, that its produce exceeds that of all the other soils. Perhaps this proposition, when proved, may be understood more clearly. The fact is, that as additional supplies are raised, the landlord’s absolute share of the produce is increased, while his proportional share is diminished. Now when an inferior soil is resorted to, the landlord gets an increased portion of all the corn that is raised, independently of this last soil. The portion of it that goes to labour and profit is therefore diminished, and this increase of the landlord’s, and decrease of the tenant’s share, is measured by, or is proportional to, the inferiority of the last soil taken into cultivation. The increase of the tenant’s share is equal to the produce of the last soil taken into cultivation. And as the tenant’s share increases faster than the landlord’s, this last quantity must be great, relatively to the inferiority of the last soil, and the tenant’s share of the produce before this last soil was cultivated. The same effect might be produced by agricultural improvements causing a greater addition to the total produce of the soil than to the differences of the returns to successive applications of capital. In either case we would be warranted in concluding, if we judge of the future by the past, that the cost of production of corn, if it increases at all, must increase very slowly, and that with each step a greater increase of population must arise to create the necessity of taking another step. We shall afterwards see what a favourable effect this will have upon the condition of the labourer. On the next day, I shall proceed to the subject of profits.