Front Page Titles (by Subject) Section VIII.—: On the strict and necessary Connection of the Interests of the Landlord and of the State. - Principles of Political Economy
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Section VIII.—: On the strict and necessary Connection of the Interests of the Landlord and of the State. - Thomas Robert Malthus, Principles of Political Economy 
Principles of Political Economy (London: W. Pickering, 1836).
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On the strict and necessary Connection of the Interests of the Landlord and of the State.
It has been stated by Adam Smith, that the interest of the landholder is “strictly and inseparably connected with the general interest of the society:” and that whatever either promotes or obstructs the one, necessarily promotes or obstructs the other.* The theory of rent, as laid down in the present chapter, seems strongly to confirm this statement. If under any given natural resources in land, the main causes which conduce to the interest of the landholder are increase of capital, increase of population, improvements in agriculture, and an increasing demand for raw produce occasioned by the prosperity of commerce, it seems scarcely possible to consider the interests of the landlord as separated from the general interests of the society.
Yet it has been said by Mr. Ricardo that, “the interest of the landlord is always opposed to that of the consumer and the manufacturer,”† that is, to all the other orders in the state. To this opinion he has been led, very consistently, by the peculiar view he has taken of rent, which makes him state, that it is for the interest of the landlord that the cost attending the production of corn should be increased,‡ and that improvements in agriculture tend rather to lower than to raise rents.
If this view of the theory of rent were just, and it were really true, that the income of the landlord is increased by increasing the difficulty, and diminished by increasing the facility of production, the opinion would unquestionably be well founded. But if, on the contrary, the landlord’s income is practically found to depend chiefly upon natural fertility of soil, improvements in agriculture, and inventions to save labour, we may still think, with Adam Smith, that the landlord’s interest is not opposed to that of the country.
It is so obviously true, as to be hardly worth stating, that if the land of the greatest fertility were in such excessive plenty compared with the population, that every man might help himself to as much as he wanted, there would be no rents or landlords properly so called. It will also be readily allowed, that if in this or any other country you could suppose the soil suddenly to be made so fertile, that a tenth part of the surface, and a tenth part of the labour now employed upon it, could more than support the present population, you would for some time considerably lower rents.
But it is of no sort of use to dwell upon, and draw general inferences from suppositions which never can take place.
What we want to know is, whether, living as we do in a limited world, and in countries and districts still more limited, and under such physical laws relating to the produce of the soil and the increase of population as are found by experience to prevail, the interests of the landlord are generally opposed to those of the society. And in this view of the subject, the question may be settled by an appeal to the most incontrovertible principles confirmed by the most glaring facts.
Whatever fanciful suppositions we may make about sudden improvements in fertility, nothing of this kind which we have ever seen or heard of in practice, approaches to what we know of the power of population to increase up to the additional means of subsistence.
Improvements in agriculture, however considerable they may finally prove, are always found to be partial and gradual. And as, where they prevail to any extent, there is generally an effectual demand for labour, the increase of population occasioned by the increased facility of procuring food, soon overtakes the additional produce. Instead of land being thrown out of cultivation, more land is cultivated, owing to the cheapness of the instruments of cultivation, and under these circumstances rents rise instead of fall. These results appear to me to be so completely confirmed by experience, that I doubt, if a single instance in the history of Europe, or any other part of the world, can be produced, where improvements in agriculture have been practically found to lower rents.
I should further say, that not only have improvements in agriculture never lowered rents, but that they have been hitherto, and may be expected to be in future, the main source of the increase of rents, in almost all the countries with which we are acquainted.*
It is a fundamental part of the theory which has been explained in this chapter, that, as most countries consist of a gradation of soils, rents rise as cultivation is pushed on poorer lands; but still the connexion between rent and fertility subsists in undiminished force. The rich lands are those which yield the mass of rents, not the poor ones. The poor lands are cultivated, because the increasing capital and population are calling for more produce, and if there were no poor soils, there would still be rents; a limited territory, however fertile, would soon be peopled; and as the demand for corn increased compared with the supply, rents would rise.
It is evident then, that difficulty of production has no connection with increase of rent, except as, in the actual state of most countries, it is the natural consequence of an increase of capital and population, and a fall of profits and corn wages; or, in other words, of an increase of wealth.
But after all, the increase of rents which results from an increase of price occasioned solely by the greater quantity of labour and other conditions of supply, necessary to produce a given quantity of corn on fresh land, is very much more limited than has been supposed; and by a reference to most of the countries with which we are acquainted, it will be seen that, practically, improvements in agriculture and the saving of labour on the land, both have been, and may be expected in future to be, a very much more powerful source of increasing rents.
It has already been shown, that for the very great increase of rents which has taken place in this country during nearly the last hundred years, we are mainly indebted to improvements in agriculture, as profits have rather risen than fallen, and little or nothing has been taken from the wages of families, if we include parish allowances, and the earnings of women and children. Consequently these rents must have been a creation from the skill and capital employed upon the land, and not a transfer from profits and wages, as they existed nearly a hundred years ago.
The peculiar increase of rents, which has taken place in Scotland during the last half century, is well known to have been occasioned by improvements in agriculture, a greater expenditure in manure, a better rotation of crops, and the saving of labour on the land.
In Ireland, neither the wages of the individual labourer, nor the profits of agricultural capital, seem as if they could admit of any considerable reduction; but there can be no doubt that a great augmentation of rents might be effected by an improved system of cultivation, and a prosperous commerce, which, at the same time that it would sweep into flourishing cities the idlers which are now only half employed upon the land, would occasion an increasing demand for the products of agriculture, while the rates of profits and wages might remain as high as before.
Similar observations may be made with regard to Poland, and indeed almost all the countries of Europe. There is not one in which the real wages of labour are high, and scarcely one in which the profits of agricultural capital are known to be considerable. If no improvements whatever in agriculture were to take place in these countries, and the future increase of their rents were to depend upon an increase of price occasioned solely by the increased quantity of labour necessary to produce food, I am inclined to think that the progress of their rents would be very soon stopped. The present rates of profits and wages are not such as would admit of much diminution; and without increased skill in cultivation, and especially the saving of labour on the land, it is probable that no soils much poorer than those which are at present in use, would pay the expense of cultivation.
Even the rich countries of India and South America are not very differently circumstanced. From all the accounts we have received of these countries, it does not appear that agricultural profits are high, and it is certain that wages in reference to the condition of the labourer are in general small in amount. And although rents might receive some augmentation from such profits and wages, yet I conceive that their possible increase in this way would be quite trifling, compared with what it might be under an improved system of cultivation, a prosperous commerce, and an effectual demand for a greater quantity of raw produce, even without any transfer from the labourer or cultivator.
The United States of America seem to be almost the only country with which we are acquainted where the present wages of labour and the profits of agricultural stock are sufficiently high to admit of a considerable transfer to rents without improvements in agriculture. And probably it is only when the skill and capital of an old and industrious country are employed upon a new, rich, and extensive territory, under a free government, and in a favourable situation for the export of raw produce, that this state of things can take place.
In old states, experience tells us that the wages of the individual labourer may be inconsiderable,* and the profits of the cultivator not high, while vast tracts of good land remain uncultivated. It is obvious, indeed, that an operose and ignorant system of cultivation, combined with such a faulty distribution of property as to check the progress of demand, might keep the profits of cultivation low, even in countries of the richest soil. And there is little doubt, from the very large proportion of people employed in agriculture in most unimproved territories, that this is a case which not unfrequently occurs. But in all instances of this kind, it must be allowed, that the great source of the future increase of rents will be improvements in agriculture, and the demand occasioned by a prosperous external and internal commerce, and not the increase of price occasioned by the additional quantity of labour required to produce a given quantity of corn.
If, however, in a country which continues to grow nearly its own consumption of corn, or the same proportion of that consumption, it appears that every sort of improvement which has ever been known to take place in agriculture, manufactures, or commerce, by which a country has been enriched, tends to increase rents, and every thing by which it is impoverished, tends to lower them, it must be allowed that the interests of the landlord, and those of the state are, under the circumstances supposed, inseparable.
Mr. Ricardo, as I have before intimated, appears to take only one simple and confined view of the progress of rent. He considers it as occasioned solely by the increase of price, arising from the increased difficulty of production.* But if rents in many countries may be doubled or trebled by improvements in agriculture, while in few countries they could be raised a fourth or a fifth, and in some not a tenth, by the increase of price arising from the increased difficulty of production, must it not be acknowledged, that such a view of rent embraces only a very small part of the subject, and consequently that any general inferences from it must be utterly inapplicable to practice?
It should be further observed, in reference to improvements in agriculture, that the mode in which Mr. Ricardo estimates the increase or decrease of rents is quite peculiar; and this peculiarity in the use of his terms tends to separate his conclusions still farther from truth as enunciated in the accustomed language of political economy.
In speaking of the division of the whole produce of the land and labour of the country between the three classes of landlords, labourers, and capitalists, he has the following passage.
“It is not by the absolute quantity of produce obtained by either class, that we can correctly judge of the rate of profit, rent, and wages, but by the quantity of labour required to obtain that produce. By improvements in machinery and agriculture the whole produce may be doubled; but if wages, rent and profits be also doubled, they will bear the same proportions to one another as before. But if wages partook not of the whole of this increase; if they, instead of being doubled, were only increased one half; if rent, instead of being doubled, were only increased three-fourths, and the remaining increase went to profit, it would, I apprehend, be correct for me to say, that rent and wages had fallen while profits had risen. For if we had an invariable standard by which to measure the value of this produce, we should find that a less value had fallen to the class of labourers and landlords, and a greater to the class of capitalists than had been given before.”*
A little farther on, having stated some specific proportions, he observes, “In that case I should say, that wages and rent had fallen and profits risen, though, in consequence of the abundance of commodities, the quantity paid to the labourer and landlord would have increased in the proportion of 25 to 44.”†
But, to estimate rent and wages by the proportion which they bear to the whole produce, must, in an inquiry into the nature and causes of the wealth of nations, lead to perpetual confusion and error. For what does it require us to say? We must say that the rents of the landlord have fallen and his interests have suffered, when he obtains as rent above three-fourths more of raw produce than before, and with that produce will shortly be able, according to Mr. Ricardo’s own doctrines, to command three-fourths more labour. In applying this language to our own country, we must say that rents have fallen considerably during the last forty years, because, though rents have greatly increased in exchangeable value,—in the command of money, corn, labour and manufactures, it appears, by the returns to the Board of Agriculture, that they are now only a fifth of the gross produce,‡ whereas they were formerly a fourth or a third.
In reference to the price of labour, we must say that it is low in America, although we have been hitherto in the habit of considering it as very high. And we must call it high in Sweden; because, although the labourer only earns low money wages, and with them can obtain but few of the necessaries and conveniences of life; yet, in the division of the whole produce of a laborious cultivation on a poor soil, a larger proportion may go to labour.*
Into this unusual language Mr. Ricardo has been betrayed by the fundamental error of adopting a measure of value, which varied with the thing to be measured.
If, however, we were to use a really invariable measure, the result would be totally different from that which he has stated. Let us suppose, for instance, that a produce of 110 quarters of corn were divided into 60 quarters for the advances of labour and other capital, 40 for rent, and 10 for the farmer’s profits, and that subsequently labour became doubly productive, so that the same quantity of labour and other capital produced 220 quarters instead of 110, and were divided as supposed by Mr. Ricardo, that is one half more produce awarded to the labourer, three fourths to rent, and the remainder to profits. The result would be as follows:
Now, if we measure these incomes in money of an invariable value, and with a view to simplify the calculation, suppose that in the first case each quarter is worth £1, that four men are employed for the year in immediate labour, and advances equivalent in value to the wages of two men are made in accumulated labour and profits, that the capital employed is therefore £60, and that the wages of labour are 10 quarters, or £10 a year, the following will be the results on the increase of produce.
1. The price of the quarter will fall from £1 to 13s. 4d.,* £60 being the price of 90 quarters.
2. The price of the whole produce will rise from £110 to £146. 13s. 4d., this sum being the price of 220 quarters, at 13s. 4d. a quarter.
3. The money will rise from £40 to £46. 13s. 4d., this sum being the price of 70 quarters, at 13s. 4d. a quarter.
4. The rate of profits will rise from 16⅔ per cent. to 66⅔ per cent. the difference being the advance of 60 quarters with the return of 70, and of 90 with the return of 150.
5. The corn wages of labour will increase from 10 quarters to 15 quarters, 90 quarters instead of 60 being divided among the six labourers; but the price of the 90 quarters being the same as that of the 60 quarters, the value of the wages paid will remain exactly the same.
It will indeed be perfectly true that the 15 quarters of corn now paid to each labourer can be raised at a less expense of mere labour than the 10 quarters were before, and it is on this account specifically that Mr. Ricardo would say that labour had fallen; but he throws quite out of consideration the prodigious difference of profits under which the wages of the labourer are produced in the two cases considered. Now though it may be said that when the value of commodities is made up of labour and profits, if profits be the same, their relative value will depend exclusively on the labour employed, yet it is obviously quite impossible that this should be the case, when profits are most essentially different, as in the case stated.
In the present instance the difference is between a profit of 16⅔ per cent., and 66⅔ per cent. Supposing the 60 quarters which in the first case pay the wages of 6 men to be produced with a profit of 16⅔ per cent., the quantity of labour employed to produce them would be 5.14. Supposing the 90 quarters which in the second case pay the wages of the 6 men to be produced with a profit of 66⅔ per cent., the quantity of labour employed would be 3.6. This is no doubt a very great difference; but the very great difference in the rate of profits exactly counterbalances it, and renders the value of the labour of 6 men for the year in both cases just the same.
The foregoing cases shew further how fundamentally erroneous it is to consider the rise of rent, when measured by an invariable standard, as depending entirely upon a rise in the price of corn, which must proportionally injure the consumer. We have here an instance of the fall of the money price of corn from £1 a quarter to 13s. 4d., while the money rent rises on the first division proposed, from £40 to £46. 13s. 4d.* But it is not consistent with the natural tendency to accumulation, and the principle of population, that such profits as 66⅔ per cent., and such wages as 15 quarters a year, should continue for any length of time; and if owing to the rapid increase of capital and population which, if the produce were properly distributed, would unquestionably take place, we were to suppose them gradually to return to their former rates, and the money price of corn to its former price, we should find that after an interval of great prosperity to all classes, and without any subsequent pressure upon the capitalist, the labourer, or consumer, greater than before the extraordinary improvement supposed, corn rent on the same land would have risen from 40 quarters to 160 quarters, and money rent from £40 to £160.
Now if we compare this prodigious increase of rent, occasioned by facility of production, with any increase which could have taken place owing to difficulty of production, we shall see the great superiority of the former source of rent over the latter.
The labouring classes could not probably admit of a greater reduction in their corn wages than from 10 quarters a year to 8 quarters a year, in which case if corn were estimated in money of a fixed value, the price could not rise higher than from £1 to £1. 5s. Nor is it probable that profits would admit of a greater reduction than from 16⅔ to 6⅔ before accumulation would be nearly at a stand. On these suppositions the division of the produce of 110 quarters would be as follows:—
The remainder of the 110 quarters, equal to 58⅘ quarters, will be corn rent; and 58⅘ quarters, at £1. 5s., equal to £73. 10s., will be money rent.
It is obvious that if we had set out with a lower and more usual rate of profits and corn wages, such as profits of 10 or 9 per cent, and wages of 9 or 8½ quarters, the increase of rent would have been comparatively trifling, and that in those countries where the wages of labour are at what Mr. Ricardo has called the natural price, that is, at such a price as is only sufficient to maintain a stationary population, no permanent rise in the price of corn or increase of rent arising solely from the reduction of profits and wages is possible.
The only doubt which can exist respecting the strictest union between the interest of the landlord, and that of the state, is in the question of importation. And here it is evident that at all events the landlord cannot be considered as placed in a more invidious situation than other producers. No person has ever doubted that if some foreign nations were to excel us in machinery, the individual interests of the actual manufacturers of woollen, silk, linen, or cotton goods, in this country might be injured by foreign competition; and few would deny that the importation of a large body of labourers would tend to reduce wages. Under the most unfavourable view therefore that we can take of the subject, the case of the landlord is not separated from that of other producers.*
And if to this we add that in a state of perfectly free intercourse, it is eminently the interest of those who live upon the rents of land that capital and population should increase, while to those who live upon the profits of stock and the wages of labour, an increase of capital and population is, to say the least of it, a much more doubtful benefit, it may be most safely asserted that the interest of no other class in the state is so nearly and necessarily connected with its wealth, prosperity, and power, as the interest of the landowner.
[* ] Wealth of Nations, Book I. c. xi. p. 394. 6th edit.
[† ] Mr. Ricardo in his 3rd edit. (c. xxiv. p. 399.) allows that the landlord has a remote interest in improvements; but still dwells without sufficient reason on the interval of injury which he sustains.
[‡ ] Ibid.
[* ] In an article of the Edinburgh Review, on Mr. Jones’ Theory of Rent, the reviewer alludes to the error of Mr. Ricardo in regard to the effects of agricultural improvements on the rents of the landlords; and says, “Had Mr. Jones been the first to point out this mistake of Mr. Ricardo, and to rectify it, he would have done some little service to the science.” For the first rectification of the mistake, a reference is made to what had been published twelve months previously to the appearance of Mr. Jones’ work, in the second edition of Mr. M‘Culloch’s Political Economy.
Now as the reviewer was so ready to accuse Mr. Jones of not knowing what had been done by others, he should not himself have been ignorant that the mistake had been rectified in this work, not merely twelve months, but nearly twelve years before, that is, in 1820, before Mr. Ricardo’s 3rd edit. came out.
[* ] If, partly from indolence, and partly from the want of demand for labour, which is the great parent of indolence in these countries, the labourer works only two or three days in the week, wages, though they may be low in reference to the condition of the labourer, may be high in reference to the outgoings of the capitalist.
[* ] Mr. Ricardo always seems to assume, that increased difficulties thrown in the way of production will be overcome by increased price, and that the same quantity will be produced as would have been produced if no increased difficulty had occurred. But this is quite an unwarranted assumption.
[* ] Principles of Political Economy, ch. i. p. 49, 3rd edit.
[† ] Id. p. 50.
[‡ ] Reports from the Lords on the Corn Laws, p. 66.
[* ] It is specifically this unusual application of common terms which has rendered Mr. Ricardo’s work so difficult to be understood by many people. It requires indeed a constant and laborious effort of the mind to recollect at all times what is meant by high and low rents, and high or low wages. In other respects, it has always appeared to me that the style in which the work is written, is perfectly clear. It is never obscure, but when either the view itself is erroneous, or terms are used in an unusual sense.
[* ] Mr. Ricardo thought that it would fall to 10s., because he supposes the same amount of labour and capital to yield double the amount of corn. But as according to his own supposition, 90 quarters, instead of 120, will pay the six labourers, it is obvious that the price of the quarter will only fall to 13s. 4d.: and the values of the whole produce, and of the rent vary accordingly.
[* ] Mr. Ricardo by his proposed division of the produce has assumed that the demand is such as to occasion the produce to be so divided; and then the results stated will follow. But in reality if the labour on the land were to become at once doubly productive, there would certainly be a glut of corn, and the division of the produce would be very different from that which he has supposed.
[* ] Colonel Torrens concludes the second edition of his Treatise on a Free Corn Trade with the following passage: “The class of land proprietors have not any more than the capitalists and labourers an interest in imposing restrictions on the importation of foreign corn.” If this be so, the identity of the interests of landlords and of the state is even more complete than I had ventured to express it.