531.: ricardo to malthus1[Answered by 532] - 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
[Answered by 532]
London 13 July 1823
My Dear Malthus
McCulloch and I did not settle the question of value before we parted,—it is too difficult a one to settle in a conversation.—I heard every thing he had to urge in favor of his view, and promised, during my holiday, to bestow a good deal of consideration on it.
He means exactly what you say:—he does not contend that commodities exchange for each other according to the quantity of labour actually worked up in them, but he constitutes a commodity the general measure, by which he estimates the value of all others. A pipe of wine kept for 3 years has no more labour worked up in it than a pipe of wine kept for a day, but he says the additional value on account of time must be estimated by the accumulations which a like amount of capital actively employed in the support of labour would make in the same time. An oak tree which has been growing for 200 years has very little labour actually worked up in it, but its value is to be estimated by the accumulated capital which the original labour employed would give in the same time. He and you in fact differ as to your original measure. I think he could not give any other good reason for chusing a medium which requires labour and capital to produce it, rather than one which requires labour only, excepting that commodities in general require the combination of the two, and that a measure, to have any claim to be even an approximation to an accurate one, should itself be produced under circumstances somewhat similar to the commodities which it is to measure. If all things required precisely the same quantities of capital and labour, and for the same length of time, to produce them, any one of them would be an accurate measure of the rest; but this is not the case; the conditions admit of infinite variety, and therefore whichever we chuse it can only be an approximation to truth, and we are bound to give good reasons for preferring it.
I should indeed be wanting in candour if I refused to admit that my money measure would not measure the quantity of labour worked up in commodities. I have admitted it over and over again. I am also ready to admit that your money measure will measure exactly the quantity of labour and profits together of which commodities are composed, but so will my money measure. Neither of them will measure the quantity of labour alone worked up in commodities, but they will both measure the quantity of labour and profits together of which commodities are composed. Suppose gold always to require the same quantity of labour, for one year, before it can be brought to market, will you say that all variations in wages and profits may not be estimated in this medium? You would indeed say that many of those variations would be ascribable to the variations in the value of the medium, and not to any alteration in the value of the thing measured, because you do not think that it is any proof of invariability in a commodity that it requires always the same quantity of labour, and the same duration of time to produce it. If I allow the justice of your objection, I am at liberty to apply the same to your medium. The same quantity of labour applied for a day will always produce the same given quantity of gold, gold is therefore an invariable measure you say. I find this gold vary in relation to another commodity which always requires the same quantity of labour and capital to produce it, you say it is never the gold but it is always the commodity which varies, and when you are asked why, you answer because labour never varies. Double the quantity of labour in a country, or diminish it one half, always leaving the funds which are to employ it at precisely the same amount, and you tell us notwithstanding the condition of the labourer is in the one case a very distressed one, in the other a very prosperous one—that the value of his labour has not varied. I cannot subscribe to the justness of this language. The question is whether you are right not whether I am wrong.
Suppose that a man in India could pick up in a day precisely the same quantity of gold as in England, and that all trade in provisions were forbid between the two countries. The small quantity of rice and clothing in India which are necessary for the support of a labourer would be of precisely the same value as the quantity of wheat and clothing necessary for a labourer in England. But this would not long continue. All manufactured commodities would be of a high comparative money value in India, and consequently we should export manufactured commodities, and import gold; the reward of a labourer in England would come to be a much larger quantity of gold than he could actually pick up here. No gold would be then obtained in England but by means of importation. Under these circumstances you would say that money was of a low value in England and you would be correct if all men agreed to constitute labour the measure of value; but in this they do not agree, and as we should find that at the very moment that gold was low, relatively to labour, in England, it was high relatively to manufactured commodities of every description, with which in fact gold would be purchased from India, if we took these commodities for the measure we should be bound to say that gold was cheap in England and dear in India. You must remember that the point in dispute is whether labour be the correct measure of value, you must not then take the fact for granted, and then offer it as a proof of your correct conclusion.—
We leave London for Gatcomb early to-morrow morning. Next week we expect to have my sister and her family with us—we shall have one bed disengaged if you and Mrs. Malthus will come over to us.—I am sorry I cannot ask all your party.
Ever truly Yrs.