430.: ricardo to say2[Reply to 393.—Answered by 446] - David Ricardo, The Works and Correspondence of David Ricardo, Vol. 8 Letters 1819-June 1821 [1819]
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The Works and Correspondence of David Ricardo, ed. Piero Sraffa with the Collaboration of M.H. Dobb (Indianapolis: Liberty Fund, 2005). Vol. 8 Letters 1819-1821.
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First published by Cambridge University Press in 1951. Copyright 1951, 1952, 1955, 1973 by the Royal Economic Society. This edition of The Works and Correspondence of David Ricardo is published by Liberty Fund, Inc., under license from the Royal Economic Society.
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430.
ricardo to say
[Reply to 393.—Answered by 446]
London 8 May 1821
Dear Sir
I should have written to you immediately after I received your present of the “Letters” which you addressed to Mr. Malthus, had I not expected, that by delaying it for a short time, I should have been able to send you a copy of the 3d. edition of my book. Owing to the delay of Bookseller, and Printer, the time has been protracted far beyond my expectation, but at length I am able to send you herewith one of the first published copies of this last edition. In it, I have pointed out the particular difference which exists between us, respecting the meaning which should be attached to the word “value”. You use it in the same sense as “riches” and as “utility” and it is this part of your valuable work which I am very anxious should have the benefit of your further consideration.
In your doctrine of productive services I almost fully agree, but I submit to you, whether, as rent is the effect of high price, and not the cause of it, it should not be rejected when we estimate the comparative value of commodities. I have two loaves of bread before me, one raised on the very best land in the country, for which there is probably paid £3 or £4 pr. acre for rent; the other raised on land for which there is not paid pr. acre as many shillings for rent, and yet both loaves are precisely of the same value, and are equally good. You would say that in one the productive service of land was highly paid, while comparatively little was paid for the productive services of capital and labour; while in the other much was paid for the productive services of capital and labour, and little for that of the land. This is no doubt true, but the information is not useful and can lead to no inference whatever that can guide our future practice. What we wish to know is what the general law is that regulates the value of bread, as compared with the value of other things, and I think we find that one description of bread, namely, that for the raising of which little or no rent is paid, regulates the value of all bread; and that its value in relation to other things depends on the comparative quantity of labour bestowed on its production, and the quantity of labour bestowed on the production of those other things.
Allow me also to remark that your work would be much more valuable if you entered more fully into the laws which regulate rent and profit. It certainly was a great mistake of Adam Smith to suppose that profits depended on the degree of accumulation of capital, without reference to the question of population, and the means of providing for that population.
I have read your letter to Mr. Malthus with great interest. In much of what you say in it I fully agree, but I cannot give my assent to all the doctrines which it advocates,—particularly to those on which I have already spoken, and which are substantially the same as the doctrines contained in your more important work. Mr. Malthus and I frequently see each other—we talk incessantly on the points we differ about, but without convincing each other. I am happy to say that the science of Political Economy is more and more studied by the young men of this country. We have lately formed a society, or rather a club of Political Economists, in which we can boast of the names of Torrens, Malthus, and Mill—we have many others who are anxious for the establishment of the principles of a liberal policy in trade, but whose names have not been so much before the public as those I have mentioned.
You, I know, always exert yourself in the good cause, and have no other object in view but the diffusion of knowledge, and the triumph of truth.
Believe me to be Dear Sir Very sincerely Yours
David Ricardo
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