The Online Library of Liberty

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• 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]

91.

ricardo to malthus1
[Answered by 92]

London 17 April 1815

My dear Sir

You, I think, agree with Mr. Torrens2 that a rise in the price of corn will be followed by a rise in the price of home commodities;—but your theory requires that there should be no rise in the price of those commodities on which the wages of labour are expended, for if they rose in the same proportion as corn, there could be no fall in the corn wages of labour. Is it not however very improbable that all manufactures should rise at home and yet that those on which labour1 are expended should not rise? Is not the price of soap, candles &c^a., though foreign commodities, necessarily affected by the rise in the price of those home goods which are given in exchange for them.

Mr. Torrens theory however on this part of the subject appears to me defective, as I think that the price of commodities will be very slightly affected either by a rise or fall in the price of corn. If so every rise in the price of corn must affect profits on manufactures, and it is impossible that agricultural profits can materially deviate from them.

I will however suppose that you and Mr. Torrens are correct, and that commodities do rise in price with every increased price of corn. The value of fixed capital as well as of circulating capital employed on the land will then rise also, and altho’ the money value of the produce should be increased on the old land it will still bear the same proportion to the money value of the capital employed, and as this produce will be divided in different proportions between the landlord and the farmer the rate of profits of the latter will fall. For the purpose of examining the effects let us suppose that all commodities rise, with the rise of the price of corn, excepting those only on which the wages of labour are expended, and that in consequence the corn wages of labour fall. Suppose the price of corn £4 and that on the old land the labour of 8 men was necessary to raise 80 q^rs. of corn, that no rent was paid, and that each labourer had 8 quarters annually for his wages of which one half was expended on commodities. The gain of the farmer when the price was £4 would be £64 or 16 q^rs. and besides his fixed capital, horses, seed, &c^a. he would require the value of 64 q^rs. or £256 to pay the annual wages of his labourers, consequently his profits would be in the proportion of £25 to £100 of wages, for 256 : 64 :: 100 : 25

Now suppose corn to rise to £4. 10, wages would vary only 10/- on 4 quarters, and consequently would rise to £34 annually p^r. man or £272 on the old land,—but the 80 q .rs of corn would sell for £360 - leaving a produce1 of £88 to be divided between farmer and landlord,—and 88 would be to 272 as 32 to 100.

But on the new land the labour of 8 men and a half might be required to obtain 80 q^rs. or £360,—the labour of 8½ men would cost at £34 each £289 consequently the profit would be £71—which is to the whole expence of £360 as £19.7 to £100

It appears then that the profit on new land which regulates the profit on all other land would be 19.7 pc^t. when the price of corn was £4. 10 -. It was 25 pc^t. when the price was £4. -

If indeed under the same circumstances we had supposed the price of corn to rise to £6 then profits would be increased and would be much more than 25 pc^t. but some adequate cause must be shewn for such rise and it cannot be arbitrarily assumed. Your theory supposes too what is impossible that the demand for manufactures will increase in the same proportion as the demand for corn at the very time that more men are employed on the land to obtain a less proportion of produce. The whole appears to me a labyrinth of difficulties; one is no sooner got over than another presents itself, and so in endless succession. Let me intreat you to give my simple doctrine fair consideration, and you must allow that it accounts for all the phenomena in an easy, natural manner.

I yesterday met Mr. Smyth, your friend, and Mr. Torrens, at Mr. Phillips. I passed a very pleasant day. Mr. Smyth was exceedingly agreeable, I like him very much. The corn question was occasionally introduced and I had an opportunity of stating some of my objections to Mr. Torrens theory.—I have no reason to think that I convinced him. I defended the use of the word depreciation in the sense which you had used it;1 and I believe I had every one with me. I fancy that his arguments in his book on currency2 are founded on the sense in which he uses the word. We spoke on the other points of difference between him and you.

Mr. Smyth, Mr. Phillips and Mr. Torrens have agreed to dine with me on wednesday, which has induced me to write to you a day or two sooner than I otherwise should have done, that I might express my wish that you would join us.

If you will, we will dine as late as you please. There will be a bed at your service, and I need not say that you will add considerably to my pleasure.

Y^rs. very truly

David Ricardo

[1 ]Addressed: ‘To / The Revd.T R Malthus / East India College / Hertford’.

MS at Albury.—Letters to Malthus, XXXI.

[2 ]Essay on the External Corn Trade, p. 81 ff.

[1 ]Should be ‘the wages of labour’.

[1 ]Replaces ‘profit’.

[1 ]See above, p. 205, n. 4.

[2 ]An Essay on Money and Paper Currency, London, Johnson, 1812.