The Online Library of Liberty

A project of Liberty Fund, Inc.

• Abbreviations
• 300.: Ricardo to Mcculloch1[reply to 290 & 299]
• 301.: Ricardo to Murray1
• 302.: Ricardo to Mill1[answered By 303]
• 303.: Mill to Ricardo2[reply to 298 & 302]
• 304.: Trower to Ricardo1[reply to 295.—ANSWERED By 307]
• 305.: Ricardo to Place2
• 306.: Sharp to Ricardo2
• 307.: Ricardo to Trower2[reply to 304]
• 308.: Ricardo to Mcculloch1[answered By 309]
• 309.: Mcculloch to Ricardo1[reply to 308.—ANSWERED By 310]
• 310.: Ricardo to Mcculloch1[reply to 309.—ANSWERED By 314]
• 311.: Trower to Ricardo1[answered By 312]
• 312.: Ricardo to Trower1[reply to 311]
• 313.: Ricardo to Trower2
• 314.: Mcculloch to Ricardo4[reply to 310.—ANSWERED By 315]
• 315.: Ricardo to Mcculloch3[reply to 314]
• 316.: Trower to Ricardo1[answered By 317]
• 317.: Ricardo to Trower1[reply to 316]
• 318.: Ricardo to Mill2[answered By 319]
• 319.: Mill to Ricardo1[reply to 318]
• 320.: Mill to Ricardo1
• 321.: Ricardo to Mill4[answered By 322]
• 322.: Mill to Ricardo3[reply to 321.—ANSWERED By 323]
• 323.: Ricardo to Mill1[reply to 322.—ANSWERED By 325]
• 324.: Malthus to Ricardo2[answered By 328]
• 325.: Mill to Ricardo4[reply to 323.—ANSWERED By 329]
• 326.: Ricardo to Place1
• 327.: Trower to Ricardo3[answered By 330]
• 328.: Ricardo to Malthus1[reply to 324.—ANSWERED By 338]
• 329.: Ricardo to Mill2[reply to 325.—ANSWERED By 332 & 337]
• 330.: Ricardo to Trower1[reply to 327.—ANSWERED By 339]
• 331.: Mcculloch to Ricardo1[answered By 333]
• 332.: Mill to Ricardo2[reply to 329]
• 333.: Ricardo to Mcculloch1[reply to 331.—ANSWERED By 344]
• 334.: Brown to Ricardo1[answered By 336]
• 335.: Brown to Ricardo1[answered By 336]
• 336.: Ricardo to Brown1[reply to 334 & 335]
• 337.: Mill to Ricardo1[reply to 329]
• 338.: Malthus to Ricardo1[reply to 328.—ANSWERED By 345]
• 339.: Trower to Ricardo3[reply to 330.—ANSWERED By 346]
• 340.: Bentham to Ricardo1
• 341.: Ricardo to Place2
• 342.: Place to Ricardo1[answered By 343]
• 343.: Ricardo to Place1[reply to 342]
• 344.: Mcculloch to Ricardo2[reply to 333.—ANSWERED By 349]
• 345.: Ricardo to Malthus2[reply to 338]
• 346.: Ricardo to Trower2[reply to 339]
• 347.: Say to Ricardo1[answered By 352]
• 348.: Mcculloch to Ricardo1[answered By 349]
• 349.: Ricardo to Mcculloch1[reply to 344 & 348]
• 350.: Ricardo to Heathfield1
• 351.: Ricardo to Trower1
• 352.: Ricardo to Say1[reply to 347.—ANSWERED By 356]
• 353.: Lord Grenville to Ricardo2
• 354.: Ricardo to Trower1
• 355.: Ricardo to Mcculloch1[answered By 358]
• 356.: Say to Ricardo1[reply to 352]
• 357.: Ricardo to Trower1
• 358.: Mcculloch to Ricardo1[reply to 355.—ANSWERED By 359]
• 359.: Ricardo to Mcculloch1[reply to 358.—ANSWERED By 360]
• 360.: Mcculloch to Ricardo1[reply to 359.—ANSWERED By 361]
• 361.: Ricardo to Mcculloch1[reply to 360—answered By 366]
• 362.: Ricardo to Mcculloch2[answered By 366]
• 363.: Ricardo to Malthus2
• 364.: Ricardo to Sinclair1
• 365.: Ricardo to Napier1
• 366.: Mcculloch to Ricardo3[reply to 361 & 362.—ANSWERED By 368]
• 367.: Ricardo to Bentham2
• 368.: Ricardo to Mcculloch3[reply to 366.—ANSWERED By 372]
• 369.: Bentham to Ricardo5
• 370.: Ricardo to Mill3
• 371.: Trower to Ricardo3[answered By 373]
• 372.: Mcculloch to Ricardo1[reply to 368.—ANSWERED By 375]
• 373.: Ricardo to Trower1[reply to 371.—ANSWERED By 376]
• 374.: Ricardo to Mill2
• 375.: Ricardo to Mcculloch2[reply to 372.—ANSWERED By 377]
• 376.: Trower to Ricardo1[reply to 373—answered By 380]
• 377.: Mcculloch to Ricardo1[reply to 375.—ANSWERED By 381]
• 378.: Malthus to Ricardo1[answered By 379]
• 379.: Ricardo to Malthus2[reply to 378.—ANSWERED By 388]
• 380.: Ricardo to Trower2[reply to 376.—ANSWERED By 384]
• 381.: Ricardo to Mcculloch1[reply to 377]
• 382.: Mill to Ricardo1[answered By 383]
• 383.: Ricardo to Mill1[reply to 382]
• 384.: Trower to Ricardo1[reply to 380.—ANSWERED By 387]
• 385.: Mill to Ricardo2[answered By 386]
• 386.: Ricardo to Mill1[reply to 385.—ANSWERED By 389]
• 387.: Ricardo to Trower1[reply to 384.—ANSWERED By 390]
• 388.: Malthus to Ricardo1[reply to 379.—ANSWERED By 392]
• 389.: Mill to Ricardo1[reply to 386.—ANSWERED By 394]
• 390.: Trower to Ricardo1[reply to 387.—ANSWERED By 391]
• 391.: Ricardo to Trower1[reply to 390.—ANSWERED By 397]
• 392.: Ricardo to Malthus1[reply to 388.—ANSWERED By 395]
• 393.: Say to Ricardo1[answered By 430]
• 394.: Ricardo to Mill1[reply to 389.—ANSWERED By 398]
• 395.: Malthus to Ricardo1[reply to 392.—ANSWERED By 402]
• 396.: Grenfell to Ricardo1
• 397.: Trower to Ricardo4[reply to 391.—ANSWERED By 403]
• 398.: Mill to Ricardo2[reply to 394.—ANSWERED By 400]
• 399.: Mill to Ricardo2[answered By 400]
• 400.: Ricardo to Mill3[reply to 398 & 399]
• 401.: Ricardo to Mccullochcculloch3[answered By 406]
• 402.: Ricardo to Malthus1[reply to 395.—ANSWERED By 404]
• 403.: Ricardo to Trower1[reply to 397.—ANSWERED By 410]
• 404.: Malthus to Ricardo1[reply to 402.—ANSWERED By 405]
• 405.: Ricardo to Malthus1[reply to 404.—ANSWERED By 408]
• 406.: Mcculloch to Ricardo1[reply to 401.—ANSWERED By 407]
• 407.: Ricardo to Mccullochcculloch1[reply to 406.—ANSWERED By 412]
• 408.: Malthus to Ricardo1[reply to 405]
• 409.: Ricardo to Mcculloch3[answered By 412]
• 410.: Trower to Ricardo2[reply to 403.—ANSWERED By 415]
• 411.: Malthus to Ricardo2
• 412.: Mcculloch to Ricardo1[reply to 407 & 409.—ANSWERED By 416]
• 413.: Mill to Ricardo3[answered By 414]
• 414.: Ricardo to Mill2[reply to 413]
• 415.: Ricardo to Trower1[reply to 410.—ANSWERED By 419]
• 416.: Ricardo to Mcculloch2[reply to 412.—ANSWERED By 417]
• 417.: Mcculloch to Ricardo2[reply to 416.—ANSWERED By 418]
• 418.: Ricardo to Mcculloch1[reply to 417.—ANSWERED By 421]
• 419.: Trower to Ricardo1[reply to 415.—ANSWERED By 420]
• 420.: Ricardo to Trower1[reply to 419]
• 421.: Mcculloch to Ricardo1[reply to 418.—ANSWERED By 422]
• 422.: Ricardo to Mcculloch1[reply to 421.—ANSWERED By 424]
• 423.: Trower to Ricardo3[answered By 426]
• 424.: Mcculloch to Ricardo1[reply to 422.—ANSWERED By 428]
• 425.: Tooke to Ricardo3
• 426.: Ricardo to Trower1[reply to 423]
• 427.: Tooke to Ricardo2
• 428.: Ricardo to Mcculloch1[reply to 424.—ANSWERED By 431]
• Malthus to Sismondi1
• 429.: Mcculloch to Ricardo1
• 430.: Ricardo to Say2[reply to 393.—ANSWERED By 446]
• 431.: Mcculloch to Ricardo2[reply to 428.—ANSWERED By 433]
• 432.: Ricardo to Sinclair1
• 433.: Ricardo to Mcculloch2[reply to 431.—ANSWERED By 434]
• 434.: Mcculloch to Ricardo1[reply to 433.—ANSWERED By 436]
• 435.: Trower to Ricardo1[answered By 437]
• 436.: Ricardo to Mcculloch1[reply to 434.—ANSWERED By 474]

344.

m^cculloch to ricardo2
[Reply to 333.—Answered by 349]

Edinburgh 2^nd Nov 1819

My Dear Sir

I trust to your goodness to excuse me for not sooner acknowledging receipt of your most friendly and valuable communications of the 2^nd October—But having been in the country for a few days at the time when your letters reached this, I got so much in arrear, that this is the first moment I have been able to devote to the agreeable task of answering the communications of those on whose friendship I set the highest value—

By means of your suggestions, I have, I think, considerably improved my Article on Exchange, and I have also added an explanation of the cause of its rise in 1815 and 18161 —I cannot, however, agree, notwithstanding the extreme distrust I feel of the correctness of any opinion on such a subject different from yours, to reject the consideration of the expence of the transit of bullion in estimating the real par of exchange2 —It appears to me that whatever affects the relative worth of the circulating media of different countries, whether it consists in a diminution of the quantity of bullion contained in their coins, or in the quantity for which their paper money will exchange, or in a diminution of the comparative value of the bullion itself, must be held to affect the nominal and not the real exchange—You have stated in your answer to Mr Bosanquet that Spain can never have an unfavourable exchange with her colonies;3 and by this statement I always understood you to mean that any given amount of the precious metals in Spain, was worth more than the same amount in South America, and that therefore the nominal exchange must be proportionably in favour of the former—You would admit that if gold and silver were accumulated by means of restrictive regulations in a particular country, that its nominal exchange would be rendered proportionably unfavourable—Now, why should the case be different when the same effect is produced by natural causes, such as the possession of productive mines, &c? I cannot help thinking the example I gave of the case of sugar decisive—It could not surely be maintained that the exchange was at true par, if a bill which cost 200 hogsheads of sugar in London only brought 100 in Jamaica—

I think you err in stating that if there were no expences whatever in sending bullion from one country to another the exchange would never deviate from par—This principle would hold good if no time as well as no expence were required in the transportation of bullion, but not otherwise—Although bullion could be brought free of expence from South America to restore any derangement in the equilibrium of the value of money in Europe, yet it is clear this derangement could not be adjusted for many weeks—

I was very sorry to learn that you did not mean to write an Article on the Funding System for the Supp to the E.B. but only on the Sinking Fund—I hope you will yet be prevailed on to proceed with the former—The subject is one of the greatest possible interest, and it is one which has never been properly or, I may say, at all discussed—You would have an opportunity not only of tracing the comparative advantages and defects attending the providing for extraordinary expences by means of loans, as contrasted with the advantages and defects attending the providing for them by means of a sudden increase of taxation; but would also be enabled to point out the ruinous effects attending the accumulation of a large debt—Neither would the discussion be at all difficult—It would only be giving a practical application to the grand principles which you have already established—Nothing will give me greater pleasure than to hear that you are going on with the Funding System, and I am sure that a Dissertation by you on that subject would be of infinite importance—

I am particularly gratified with what you state respecting my Article in the Review on the Trade with France;1 and I hope that you will endeavour to afford a practical proof of the efficacy of the principles on the freedom of trade—However much I am disposed to concur in your opinion on other subjects I beg to dissent entirely from what you say as to the person who should agitate that question in the House of Commons—If the public opinion is to have the least influence in such matters, I am certain it would be decidedly in favour of your agitating it; and in your hands I have no doubt whatever that a recognition of the great principles on that subject would soon be obtained—

I had a letter from Mr Torrens yesterday—He says he is to send me some of these days a copy of a reply he has written to your theory of value1 —I regret that so excellent a political economist as the Major should be so wedded to his preconceived opinions—I shall send you a copy of the Article on Exchange addressed to your House in London—And hoping to be honoured with a letter from you at your convenience I remain with every sentiment of respect and esteem

My Dear Sir Yours most faithfully

J. R. M^cCulloch

[2 ]MS in R.P.—Letters of McCulloch to Ricardo, II.

[1 ]Supplement to the Encyclopaedia Britannica, vol. iv, p. 220–1.

[2 ]See Ricardo’s fourth remark, above, p. 88–9.

[3 ]Above, III, 171.

[1 ]See above, p. 82, n. 1.

[1 ]See below, p. 138.