The Online Library of Liberty

A project of Liberty Fund, Inc.

• Preface to Volumes Vi - Ix
• Introductory Notes to the Correspondence
• 1.: Ricardo to Horner
• 2.: Ricardo to Horner
• 3.: Ricardo to Sir Philip Francis
• 4.: Mill to Ricardo1[answered By 5]
• 5.: Ricardo to Mill3[reply to 4—answered By 6]
• 6.: Mill to Ricardo1[reply to 5]
• 7.: Ricardo to Dumont
• 8.: Malthus to Ricardo1[answered By 9]
• 9.: Ricardo to Malthus1[reply to 8.—ANSWERED By 10]
• 10.: Malthus to Ricardo1[reply to 9]
• 11.: Malthus to Ricardo
• 12.: Ricardo to [malthus][fragment]
• 13.: Malthus to Ricardo
• 14.: Ricardo to [malthus] [a Note On the Jamaica Exchange]
• 15.: Malthus to Ricardo 3[answered By 16]
• 16.: Ricardo to Malthus 2[reply to 15.—ANSWERED By 17]
• 17.: Malthus to Ricardo 1[reply to 16]
• 18.: Ricardo to Perceval 1[answered By 19]
• 19.: Perceval (by Rosenhagen) to Ricardo 1[reply to 18]
• 20.: Ricardo to Bentham 2
• 21.: Malthus to Ricardo 1
• 22.: Mill to Ricardo 1[answered By 23]
• 23.: Ricardo to Mill 1[reply to 22.—ANSWERED By 24]
• 24.: Mill to Ricardo 1[reply to 23]
• 25.: Ricardo to Malthus 1[answered By 26]
• 26.: Malthus to Ricardo 1[reply to 25.—ANSWERED By 27]
• 27.: Ricardo to Malthus 1[reply to 26]
• 28.: Malthus to Ricardo1
• 29.: Ricardo to Tierney 1[answered By 30]
• 30.: Tierney to Ricardo1[reply to 29]
• 31.: Malthus to Ricardo1
• 32.: Ricardo to Malthus3[answered By 33]
• 33.: Malthus to Ricardo5[reply to 32]
• 34.: Ricardo to Horner1
• 35.: Malthus to Ricardo2
• 36.: Ricardo to Malthus1[fragment]
• 37.: Ricardo to Malthus1
• 38.: Ricardo to Malthus1
• 39.: Ricardo to Malthus2
• 40.: Ricardo to Malthus 1
• 41.: Ricardo to Malthus2
• 42.: Ricardo to Malthus1
• 43.: Ricardo to Malthus1
• 44.: Ricardo to Trower1
• 45.: Ricardo to Malthus1
• 46.: Ricardo to Malthus1
• 47.: Trower to Ricardo1[answered By 48]
• 48.: Ricardo to Trower1[reply to 47]
• 49.: Mill to Ricardo1
• 50.: Ricardo to Malthus1[answered By 51]
• 51.: Malthus to Ricardo3[reply to 50.—ANSWERED By 53]
• 52.: Ricardo to Bentham and Mill1
• 53.: Ricardo to Malthus1[reply to 51.—ANSWERED By 54]
• 54.: Malthus to Ricardo1[reply to 53.—ANSWERED By 55]
• 55.: Ricardo to Malthus3[reply to 54.—ANSWERED By 56]
• 56.: Malthus to Ricardo1[reply to 55.—ANSWERED By 58]
• 57.: Mill to Ricardo1
• 58.: Ricardo to Malthus1[reply to 56.—ANSWERED By 59]
• 59.: Malthus to Ricardo3[reply to 58.—ANSWERED By 60]
• 60.: Ricardo to Malthus1[reply to 59.—ANSWERED By 62]
• 61.: Mill to Ricardo1
• 62.: Malthus to Ricardo1[reply to 60.—ANSWERED By 64]
• 63.: Sinclair to Ricardo1
• 64.: Ricardo to Malthus1[reply to 62.—ANSWERED By 67]
• 65.: Sinclair to Ricardo1[answered By 66]
• 66.: Ricardo to Sinclair1[reply to 65]
• 67.: Malthus to Ricardo2[reply to 64.—ANSWERED By 70]
• 68.: Mill to Ricardo1
• 69.: Place to Ricardo1
• 70.: Ricardo to Malthus1[reply to 67.—ANSWERED By 72]
• 71.: Ricardo to Say2
• 72.: Malthus to Ricardo1[reply to 70.—ANSWERED By 73]
• 73.: Ricardo to Malthus1[reply to 72]
• 74.: Ricardo to Malthus1[answered By 75]
• 75.: Malthus to Ricardo1[reply to 74.—ANSWERED By 76]
• 76.: Ricardo to Malthus2[reply to 75]
• 77.: Ricardo to Malthus3[answered By 78]
• 78.: Malthus to Ricardo2[reply to 77]
• 79.: Trower to Ricardo2
• 80.: Malthus to Ricardo1[answered By 81]
• Malthus to Horner4
• 81.: Ricardo to Malthus3[reply to 80.—ANSWERED By 82]
• 82.: Malthus to Ricardo2[reply to 81.—ANSWERED By 83]
• 83.: Ricardo to Malthus1[reply to 82.—ANSWERED By 84]
• 84.: Malthus to Ricardo3[reply to 83.—ANSWERED By 85]
• 85.: Ricardo to Malthus1[reply to 84.—ANSWERED By 86]
• 86.: Malthus to Ricardo1[reply to 85.—ANSWERED By 87]
• 87.: Ricardo to Malthus2[reply to 86.—ANSWERED By 88]
• 88.: Malthus to Ricardo1[reply to 87.—ANSWERED By 89]
• 89.: Ricardo to Malthus1[reply to 88.—ANSWERED By 90]
• 90.: Malthus to Ricardo1[reply to 89]
• 91.: Ricardo to Malthus1[answered By 92]
• 92.: Malthus to Ricardo3[reply to 91.—ANSWERED By 93]
• 93.: Ricardo to Malthus1[reply to 92.—ANSWERED By 94]
• 94.: Malthus to Ricardo2[reply to 93]
• 95.: Malthus to Ricardo1[answered By 96]
• 96.: Ricardo to Malthus1[reply to 95]
• 97.: Malthus to Ricardo1
• 98.: Ricardo to Murray1
• 99.: Malthus to Ricardo1[answered By 100]
• 100.: Ricardo to Malthus1[reply to 99.—ANSWERED By 101]
• 101.: Malthus to Ricardo1[reply to 100.—ANSWERED By 103]
• 102.: Trower to Ricardo1
• 103.: Ricardo to Malthus1[reply to 101.—ANSWERED By 110]
• 104.: Grenfell to Ricardo1
• 105.: Whishaw to Ricardo2
• 106.: Say to Ricardo1[answered By 107]
• 107.: Ricardo to Say1[reply to 106.—ANSWERED By 117]
• 108.: Ricardo to [say]1[answered By 117]
• 109.: Mill to Ricardo5[answered By 114]
• 110.: Malthus to Ricardo1[reply to 103.—ANSWERED By 116]
• 111.: Grenfell to Ricardo1
• 112.: Grenfell to Ricardo1[fragment]
• 113.: Grenfell to Ricardo1
• 114.: Ricardo to Mill3[reply to 109.—ANSWERED By 134]
• 115.: Grenfell to Ricardo1
• 116.: Ricardo to Malthus2[reply to 110.—ANSWERED By 126]
• 117.: Say to Ricardo1[reply to 107 & 108]
• Say to Ricardo
• 118.: Grenfell to Ricardo1
• 119.: Grenfell to Ricardo1
• 120.: Trower to Ricardo1[answered By 136]
• 121.: Grenfell to Ricardo1
• 122.: Grenfell to Ricardo1
• 123.: Grenfell to Ricardo1
• 124.: Grenfell to Ricardo1
• 125.: Grenfell to Ricardo1
• 126.: Malthus to Ricardo5[reply to 116.—ANSWERED By 127]
• 127.: Ricardo to Malthus1[reply to 126.—ANSWERED By 128]
• 128.: Malthus to Ricardo1[reply to 127.—ANSWERED By 130]
• 129.: Malthus to Ricardo1[answered By 130]
• 130.: Ricardo to Malthus1[reply to 128 & 129.—ANSWERED By 137]
• 131.: Malthus to Ricardo2[answered By 132]
• 132.: Ricardo to Malthus1[reply to 131.—ANSWERED By 137]
• 133.: Grenfell to Ricardo1
• 134.: Mill to Ricardo1[reply to 114.—ANSWERED By 135]
• 135.: Ricardo to Mill1[reply to 134.—ANSWERED By 138]
• 136.: Ricardo to Trower2[reply to 120.—ANSWERED By 141]
• 137.: Malthus to Ricardo3[reply to 130 & 132]
• 138.: Mill to Ricardo2[reply to 135]
• 139.: Malthus to Ricardo1
• 140.: Ricardo to Mill2[answered By 142]
• 141.: Trower to Ricardo1[reply to 136.—ANSWERED By 147]
• 142.: Mill to Ricardo1[reply to 140.—ANSWERED By 143]
• 143.: Ricardo to Mill3[reply to 142.—ANSWERED By 145]
• 144.: Ricardo to Malthus1[answered By 148]
• 145.: Mill to Ricardo1[reply to 143.—ANSWERED By 149]
• 146.: Malthus to Ricardo1[answered By 150]
• 147.: Ricardo to Trower1[reply to 141.—ANSWERED By 154]
• 148.: Malthus to Ricardo1[reply to 144.—ANSWERED By 150]
• 149.: Ricardo to Mill1[reply to 145.—ANSWERED By 151]

5.

ricardo to mill3
[Reply to 4—Answered by 6]

My dear Sir

I have read rather more than half of the MS which you sent to me with which I have been very much pleased. As far as I am able to judge it contains some very able and just views of the subject on which it treats, which I should be sorry should be wholly lost to the public; but at the same time I am of opinion that it contains some radical defects which will prevent it, as a whole, from effecting much good without considerable alterations. In giving my opinion I hope you will consider me as feeling all becoming diffidence when it is opposed by so ingenious and profound an author, but every man must judge with the portion of understanding which is allotted to him. First, then, the author does not appear to have been aware how effectually a paper circulation is, in the sound state of a currency, kept within due bounds by the value of the precious metals;—on the contrary he argues as if he thought it admitted of indefinite increase till at last it would become so enormous as to produce some great public catastrophe. This view is not warranted by any experience of the past, nor does any just examination of the science render such an extension of a paper circulation whilst convertible into specie either probable or possible. From my knowledge of your sentiments I have not the slightest doubt of your full acquiescence in this opinion. Secondly, the author has not taken any notice, as far as I have read, of the effects which would follow from an unrestrained issue of paper on our foreign relations; an effect highly important to be considered. Thirdly; Much of his argument is built on the assumption that an increase of the circulating medium though attended with the effect of depreciating the value of the currency, is also attended, (provided it be introduced through commercial channels,) with an increase of capital and commodities, and is so far beneficial;—he has supposed that money calls goods into existence which but for that money would not have been produced.—This opinion is advanced in many parts of his work, and was to me of great difficulty, as he had not advanced any reasons for entertaining it. At length however just before the place where I have left off I found a section or chapter devoted to that purpose,1 and after giving it my most serious attention I confess I should come to quite an opposite conclusion. As paper money is generally introduced for commercial purposes he is of opinion that it is almost always attended with the advantages which he had before ascribed to the proper introduction of metallic money. As much of the revenue of a country consists in a fixed money rent he supposes an unwillingness in those who receive it to save or rather to expend it on those objects which shall cause a future increase of revenue. Now as all the money introduced by commercial means would be so expended he considers the same beneficial effects would follow as if those with monied incomes had thus beneficially employed their rents and annuities.

The increase of money in my opinion can have no other effect than raising the prices of commodities. By such means some members of the community are enriched at the expence of others; there is a mere transfer of property, but no creation. Whether those who are enriched will employ their additional income more economically or more advantageously than those who before possessed it, must be matter of speculation only. My opinion however is that by no class are greater savings made than by those who are in possession of fixed monied rents and annuities. As far as they have come under my observation, and I have seen a good deal of monied men, they are amongst the most accumulating of the community.

There appears to me only one way in which any addition would be made to the Capital of a country in consequence of an addition of money; it would be this. Till the wages of labour had found their new level with the altered value of money,—the situation of the labourer would be relatively worse; he would produce more relatively to that which he consumed, or rather he would be obliged to consume less. The manufacturer would be enabled to employ more labourers as he would receive an additional price1 for his commodities; he might therefore add to his real capital till the rise in the wages of labour placed him in his proper sphere. In this interval some trifling addition would have been made to the Capital of the community.—

Fourthly the author supposes that the issues of Bankers are and may be regulated by the proportion of their deposits, —but this is clearly an erroneous opinion. A banker may issue 300,000 on a deposit of 100,000 perhaps safely; but it does not therefore follow that with a deposit of a million he might safely issue 3 millions.

To what I have already observed relatively to the effects of an increase of money,—I may add that the importation of money by commercial means would not only not be attended with an increase of commodities, but with an actual diminution. Money or the metal from which money is made could not be imported unless from the increased production of the mines, the value of that metal had generally fallen in the world which would force an increased use for it. Now in the state of money gold (or silver) is not productive to us nor does it augment our riches,—but to obtain this unproductive commodity we should in return export commodities which may be considered as really effective capital. Not only would individuals be injured by the greater abundance of gold but all countries excepting that which possessed the mine, as they would all contribute by their labour to produce those commodities with which money must necessarily be purchased by them.—

These are a few of the principles which have struck me as radically wrong in the work which I have perused,—it contains however much that is excellent and I should be sorry if we should lose what is good because some error may be mixed with it.

I do not know whether you are in a hurry to have the whole or part returned to you, I have unfortunately been much engaged of an evening lately and shall be for some days to come. I staid at home yesterday morning and employed myself exclusively in considering the passages to which I have alluded. I shall finish it in a few days, perhaps a week, if you can spare it so long, but if you can not let me know and I will return it immediately. I have marked with a pencil in the margin by a number, those passages which do not appear clear to me or from which I dissent and have made some short remarks upon them on a paper which I had before me. You will I fear be tired with this long uninteresting scroll, I therefore hasten to relieve you from any further fatigue attending its perusal. I hope you will write me a line informing me on what day in the next week you can make it convenient to take your mutton with me. I hope you will not quit me again before day light.

Y^rs. truly

David Ricardo

1 Jan^y 1811.

[3 ]Addressed: ‘J. Mill Esqr.’.— Not passed through the post. Docketed by Mill: ‘Mr. Ricardo / Jany 1811 / On Bentham/Dumonts Money papers’.

MS in Mill-Ricardo papers.

[1 ]Cp. Note 34 on Bentham’s Livre II; above, III, 318.

[1 ]In MS ‘prices’.