458.: ricardo to malthus1[Reply to 455.—Answered by 459] - David Ricardo, The Works and Correspondence of David Ricardo, Vol. 9 Letters 1821-1823 
The Works and Correspondence of David Ricardo, ed. Piero Sraffa with the Collaboration of M.H. Dobb (Indianapolis: Liberty Fund, 2005). Vol. 9 Letters 1821-1823.
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ricardo to malthus
[Reply to 455.—Answered by 459]
Gatcomb Park 18 Sepr. 1821
My Dear Malthus
Without imputing the least blame to you, I fear that I do not quite understand your “knotty point.” You appear to me to compare things together, which cannot, under any supposable circumstances, be made the subject of comparison. You compare a commodity in the production of which the advances in labour remain the same while the profits of stock diminish, to another commodity “obtained by a given quantity of labour, a given quantity of capital, and a given rate of profits”. Is not this supposing two rates of profit at the same time? Perhaps this was not meant, and your question was asked on the supposition of profits varying equally in all trades. If so, I have no hesitation in answering that if from an increased quantity of labour on the land, corn should appear to have doubled in money price, and not from any increased facility in the production of money, we ought to say as we always do say that corn had risen 100 pct., and not that money had fallen 50. In differing on this point we in reality come to our old dispute, whether the quantity of labour in a commodity should be the regulator of its value, or whether the value of all things, should, under all circumstances, be estimated by the quantity of corn for which they would exchange. You say “we cannot surely assume that the cost of producing the necessaries of the labourer is low absolutely when the land is productive, if what is gained by the small quantity of labour employed is counterbalanced by the very high rate of profits” I of course should say that the cost of these necessaries was low if they were produced with little labour, but would not you who adopt another measure, and sometimes think value is to be estimated by the quantity of things generally which the commodity could command, would not you say, that the cost of these necessaries was small in value agreeing as you would that they would not command an abundance of other things? I do not know what you mean by the low cost of necessaries being counterbalanced by the very high rate of profits. If 100 qrs. of corn be to be divided between my labourers and me, its cost being made up of wages and profits, its cost will be the same, whether profits be high or low, and this division will in no degree affect the price of the corn, but if at a subsequent time 80 qrs. only can be obtained with the same labour and capital, and in consequence a greater proportion of the 80 be given to the labourers than was before given of the 100, corn will rise absolutely both in my measure and in yours. It is I who am willing to take some one or more of the external commodities, in the production of which, while the advances in labour increase in money value, the profits of stock diminish, as a steady measure, but which you so often reject, and insist that whether the produce of a given quantity of labour be 100 or 80 qrs., in either case, corn has remained a steady measure of value. In the case you have supposed, you say that the commodity in which the same advances for labour were made, while profits diminished, “would not only fall one half relatively to corn, but it would appear to do so estimated in any common external commodity which had all along been produced by the same quantity of labour, and at the same rate of profits” I wish you had named this commodity. In the first place I deny that it would be produced at the same rate of profits, for there cannot be two rates of profit at the same time in the same country, and secondly I contend that this commodity would also fall to one half relatively to corn, and therefore would appear invariable when compared with the other commodities.
Perhaps by external commodity, you mean a foreign commodity to be imported from abroad. If so, why should not that commodity vary in reference to corn in the same degree as any home made commodity. If a hogshead of claret, were worth a certain quantity of cloth, of hats, of hardware &ca. would its relative value to these things alter because it was more difficult to raise corn in England, and its price rose because we refused to import it from other countries? To me it appears most clear that claret would not vary as compared with the things which I before enumerated, and that it would vary as compared with corn. Pray think of this and tell me whether I am not right.
In the postscript to your letter you ask “In the two extreme cases of the highest profits, and the lowest profits on the land, may not corn and labour remain of the same value estimated in some external commodity, although in the interval considerable variations may have taken place from supply and demand”? I answer, no, it could not remain of the same value. You would allow it could not remain of the same value estimated in home commodities, and as it is by means of these home commodities that we should purchase the external commodities, I cannot see the slightest reason for supposing that these commodities so exchanged could alter in relative value. I hope I have made myself understood. I am glad you approach a little towards my views, I wish you had told me to what extent.—Torrens told me he should send me his book, he has not done so and I have not seen it.