491.: ricardo to mcculloch2[Reply to 485.—Answered by 495] - 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 mcculloch
[Reply to 485.—Answered by 495]
London 19th March 1822
My Dear Sir
I have heard from Mr. Dick this day that he has already sent you the papers with which I entrusted him, and which I concluded he would himself convey to you. It becomes therefore necessary that I should no longer delay telling you that I was very much pleased with your lectures. I was glad to find that the opinions which we both hold, were so ably and clearly expressed, and cannot but anticipate from your efforts their progress and general dissemination.
You go a little farther than I go in estimating the value of commodities by the quantity of labour required to produce them: you appear to admit of no exception or qualification whatever, whereas I am always willing to allow that some of the variations in the relative value of commodities may be referred to causes distinct from the quantity of labour necessary to produce them. If 1000 bricks vary in relative value to a certain quantity of muslin, produced by the aid of valuable machinery, it may be owing to one of two causes: more or less labour may be required to produce one of them; or wages may have risen or fallen generally. With respect to the first being a cause of variation we entirely agree, but you do not appear to admit that although the same quantities of labour shall be respectively employed on the bricks and the muslin that their relative values may vary solely because the value of labour rises or falls, and yet the fact appears to me undeniable. To this second cause I do not attach near so much importance as Mr. Malthus and others but I cannot wholly shut my eyes to it.—
There is another passage in your lecture which I think requires a slight correction; you say “Every produce may be employed to satisfy the wants or to add to the enjoyment of its possessor; or it may be employed as capital and made to reproduce a greater value than itself ”. It may be employed as capital if it be a commodity that can be used in reproduction, or if it can be exchanged for such, but if you produced wine and I produced fine cloth we could neither use them as capital, nor exchange them with each other for commodities which could be used as such.
I was much pleased with your leading article in the Scotsman, which reached me to-day, on the proofs of prosperity; and shall look with interest to the promised article on profits. I have however one remark to make and that is on the observation that profits and wages may both be high. In what medium can they both be high? They may indeed be both paid by an abundance of the quantity of the commodity produced, but then the commodity will be of comparatively low value and profits will be high, if the proportion of the whole quantity produced paid for profits be great—if the proportion be small profits will be low and wages high.
I am glad that The Edinb. Police Bill is likely to be framed to your satisfaction—We should have made a good fight for you.