520.: ricardo to mcculloch1[Reply to 518] - 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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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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ricardo to mcculloch
[Reply to 518]
London 25 March 1823
My Dear Sir
I had just finished reading your essay “Political Economy” for the Supplement to the Encyclopedia when I received your letter. If you had written two days later our letters would have crossed on the road for I should not have lost any time in expressing to you the pleasure which I felt in the perusal of your excellent article. Besides a valuable historical sketch, you have given so clear an exposition of all the important principles of the science that you have left nothing for me to wish for. The objections which have been made to the doctrines concerning Value, Rent, Profit, Wages, Demand, and Markets have been perspicuously and fairly pointed out, and most satisfactorily answered. My only regret is that the Essay is not published independently of the work in which it will appear: it will I fear not meet with so numerous a class of reader in the Supplement as its merits would ensure if it were a separate publication.
I am happy to find by your letter that you are about to visit London—I have long desired to know you personally, and to express by word of mouth to you the esteem and respect which I entertain for you. I quite agree in opinion with you about Mr. Blake’s publication. He shewed it to me before he printed it, and I used the privelege of a friend in freely giving him my sentiments upon it: he was kind enough to give to my remarks the most attentive consideration, but he at last came to the conclusion that he had taken a correct view of the subject. Mr. Blake appears to me to agree with those whose opinions he attacks without being himself aware of it. He agrees with them that paper money should agree with the standard whatever variations in value that standard may undergo:—he agrees that in our case the restriction bill which he says ought never to have been enacted, prevented that equalization of value:—he agrees that if the ministers had had to raise loans from 1800 to 1815, and there had been no restriction bill, they would have raised sums, much less in nominal amount, than what they actually did raise, and consequently for those loans we should now have had a much less nominal sum to pay for the dividends on such loans. In what then does Mr. Blake differ from us? In the meaning of the word depreciation, and as to the fact whether the difference between gold and paper was owing to a rise in gold, or a fall in paper. In both these points he appears to me to be wrong: depreciation as applied to money must be understood to mean relative lowness as compared with the standard, and nothing else, and therefore money may be depreciated although it should rise in absolute value. As to the second point whether in point of fact gold really rose or paper really fell, there is no criterion by which this can be positively ascertained but all the appearances are against Mr. Blake. If money continued of the same value whilst gold rose, why did commodities rise also? Mr. Blake’s solution is most unsatisfactory—he attributes it to an increased Government expenditure. I should deny that an increased Govt. expenditure could raise for any length of time the prices of those commodities even for which Governt. has a demand, but it is impossible to attribute to it the prices of all other things for which Govt. has no demand. When £120 of the money in England is worth only £100 of the money of Hamburgh or of France all having been before of the same value it is impossible I think to deny either that Hamburgh and French money have risen or English money fallen. Mr. Blake denies both propositions. The case you put of America is unanswerable. You need not I assure you have the l[east] distrust of your judgment respecting exchanges, because you are unacquainted with the practical details on the subject, the theory, as you know, is very simple, and practice is in strict conformity with it.
I am glad to hear that your lectures have been successful—you are doing a great deal of good in the world—I wish I was as usefully employed, but my powers of writing or speaking are very limited. There have been several good pamphlets on the East and West India sugar question—these pamphlets shew how much way the good doctrines are making. I have no doubt you will give us a good article on the subject.—I have at different times seen some good papers from your pen in the Scotsman—It gives me the greatest satisfaction that we so exactly agree on all the great questions respecting commerce and Political Economy.—
I am with great esteem Truly Yrs.