Front Page Titles (by Subject) [I.xi.j] Different Effects of the Progress of Improvement upon the real price of three different Sorts of rude Produce - Glasgow Edition of the Works and Correspondence Vol. 2a An Inquiry Into the Nature and Causes of the Wealth of Nations, Vol. 1
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[I.xi.j] Different Effects of the Progress of Improvement upon the real price of three different Sorts of rude Produce - Adam Smith, Glasgow Edition of the Works and Correspondence Vol. 2a An Inquiry Into the Nature and Causes of the Wealth of Nations, Vol. 1 
An Inquiry Into the Nature and Causes of the Wealth of Nations, Vol. I ed. R. H. Campbell and A. S. Skinner, vol. II of the Glasgow Edition of the Works and Correspondence of Adam Smith (Indianapolis: Liberty Fund, 1981).
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Different Effects of the Progress of Improvement upon the real price of three different Sorts of rude Produce
1These different sorts of rude produce may be divided into three classes. The first comprehends those which it is scarce in the power of human industry to multiply at all. The second, those which it can multiply in proportion to the demand. The third, those in which the efficacy of industry is either limited or uncertain. In the progress of wealth and improvement, the real price of the first may rise to any degree of extravagance, and seems not to be limited by any certain boundary. That of the second, though it may rise greatly, has, however, a certain boundary beyond which it cannot well pass for any considerable time together. That of the third, though its natural tendency is to rise in the progress of improvement, yet in the same degree of improvement it may sometimes happen even to fall, sometimes to continue the same, and sometimes to rise more or less, according as different accidents render the efforts of human industry, in multiplying this sort of rude produce, more or less successful.
1The first sort of rude produce of which the price rises in the progress of improvement, is that which it is scarce in the power of human industry to multiply at all. It consists in those things which nature produces only in certain quantities, and which being of a very perishable nature, it is impossible to accumulate together the produce of many different seasons. Such are the greater part of rare and singular birds and fishes, many different sorts of game, almost all wild–fowl, all birds of passage in particular, as well as many other things. When wealth and the luxury which accompanies it increase, the demand for these is likely to increase with them, and no effort of human industry may be able to increase the supply much beyond what it was before this increase of the demand. The quantity of such commodities, therefore, remaining the same, or nearly the same, while the competition to purchase them is continually increasing, their price may rise to any degree of extravagance, and seems not to be limited by any certain boundary. If woodcocks should become so fashionable as to sell for twenty guineas a–piece, no effort of human industry could increase the number of those brought to market, much beyond what it is at present. The high price paid by the Romans, in the time of their greatest grandeur, for rare birds and fishes, may in this manner easily be accounted for. These prices were not the effects of the low value of silver in those times, but of the high value of such rarities and curiosities as human industry could not multiply at pleasure. The real value of silver was higher at Rome, for some time before and after the fall of the republick, than it is through the greater part of Europe at present. Three sestertii, equal to about sixpence sterling, was the price which the republick paid for the modius or peck of the tithe wheat of Sicily.1 This price, however, was probably below the average market price, the obligation to deliver their wheat at this rate being considered as a tax upon the Sicilian farmers. When the Romans, therefore, had occasion to order more corn than the tithe of wheat amounted to, they were bound by capitulation to pay for the surplus at the rate of four sestertii, or eight–pence sterling the peck;2 and this had probably been reckoned the moderate and reasonable, that is, the ordinary or average contract price of those times; it is equal to about one–and–twenty shillings the quarter. Eight–and–twenty shillings the quarter was, before the late years of scarcity,3 the ordinary contract price of English wheat, which in quality is inferior to the Sicilian, and generally sells for a lower price in the European market. The value of silver, therefore, in those antient times, must have been to its value in the present, as three to four inversely, that is, three ounces of silver would then have purchased the same quantity of labour and commodities which four ounces will do at present.4 When we read in Pliny, therefore, that Seius*5 bought a white nightingale, as a present for the empress Agrippina, at the price of six thousand sestertii, equal to about fifty pounds of our present money; and that Asinius Celer†6 purchased a surmullet at the price of eight thousand sestertii equal to about sixty–six pounds thirteen shillings and four–pence of our present money; the extravagance of those prices, how much soever it may surprise us, is apt, notwithstanding, to appear to us about one–third less than it really was. Their real price, the quantity of labour and subsistence which was given away for them, was about one–third more than their nominal price is apt to express to us in the present times. Seius gave for the nightingale the command of a quantity of labour and subsistence, equal to what 66l. 13s. 4d. would purchase in the present times; and Asinius Celer gave for the surmullet the command of a quantity equal to what 88l. 17s. 9⅓d. would purchase. What occasioned the extravagance of those high prices was, not so much the abundance of silver, as the abundance of labour and subsistence, of which those Romans had the disposal, beyond what was necessary for their own use. The quantity of silver, of which they had the disposal, was a good deal less than what the command of the same quantity of labour and subsistence would have procured to them in the present times.
1The second sort of rude produce of which the price rises in the progress of improvement, is that which human industry can multiply in proportion to the demand. It consists in those useful plants and animals, which, in uncultivated countries, nature produces with such profuse abundance,1 that they are of little or no value, and which, as cultivation advances, are therefore forced to give place to some more profitable produce.2 During a long period in the progress of improvement, the quantity of these is continually diminishing, while at the same time the demand for them is continually increasing. Their real value, therefore, the real quantity of labour which they will purchase or command, gradually rises, till at last it gets so high as to render them as profitable a produce as any thing else which human industry can raise upon the most fertile and best cultivated land. When it has got so high it cannot well go higher. If it did, more land and more industry would soon be employed to increase their quantity.
2When the price of cattle, for example, rises so high that it is as profitable to cultivate land in order to raise food for them, as in order to raise food for man, it cannot well go higher. If it did, more corn land would soon be turned into pasture. The extension of tillage, by diminishing the quantity of wild pasture, diminishes the quantity of butcher’s–meat which the country naturally produces without labour or cultivation, and by increasing the number of those who have either corn, or, what comes to the same thing, the price of corn, to give in exchange for it, increases the demand. The price of butcher’s meat, therefore, and consequently of cattle, must gradually rise till it gets so high, that it becomes as profitable to employ the most fertile and best cultivated lands in raising food for them as in raising corn.3 But it must always be late in the progress of improvement before tillage can be so far extended as to raise the price of cattle to this height; and till it has got to this height, if the country is advancing at all, their price must be continually rising. There are, perhaps, some parts of Europe in which the price of cattle has not yet got to this height. It had not got to this height in any part of Scotland before the union.4 Had the Scotch cattle been always confined to the market of Scotland, in a country in which the quantity of land, which can be applied to no other purpose but the feeding of cattle, is so great in proportion to what can be applied to other purposes, it is scarce possible, perhaps, that their price could ever have risen so high as to render it profitable to cultivate land for the sake of feeding them. In England, the price of cattle, it has already been observed,5 seems, in the neighbourhood of London, to have got to this height about the beginning of the last century; but it was much later probably before it got to it through the greater part of the remoter counties; in some of which, perhaps, it may scarce yet have got to it. Of all the different substances, however, which compose this second sort of rude produce, cattle is, perhaps, that of which the price, in the progress of improvement, afirst risesa to this height.
3Till the price of cattle, indeed, has got to this height, it seems scarce possible that the greater part, even of those lands which are capable of the highest cultivation, can be completely cultivated. In all farms too distant from any town to carry manure from it, that is, in the far greater part of those of every extensive country, the quantity of well–cultivated land must be in proportion to the quantity of manure which the farm itself produces; and this again must be in proportion to the stock of cattle which are maintained upon it. The land is manured either by pasturing the cattle upon it, or by feeding them in the stable, and from thence carrying out their dung to it. But unless the price of the cattle be sufficient to pay both the rent and profit of cultivated land, the farmer cannot afford to pasture them upon it; and he can still less afford to feed them in the stable. It is with the produce of improved and cultivated land only, that cattle can be fed in the stable; because to collect the scanty and scattered produce of waste and unimproved lands would require too much labour and be too expensive. If the price of the cattle, therefore, is not sufficient to pay for the produce of improved and cultivated land, when they are allowed to pasture it, that price will be still less sufficient to pay for that produce when it must be collected with a good deal of additional labour, and brought into the stable to them. In these circumstances, therefore, no more cattle can, with profit, be fed in the stable than what are necessary for tillage. But these can never afford manure enough for keeping constantly in good condition, all the lands which they are capable of cultivating. What they afford being insufficient for the whole farm, will naturally be reserved for the lands to which it can be most advantageously or conveniently applied; the most fertile, or those, perhaps, in the neighbourhood of the farm–yard. These, therefore, will be kept constantly in good condition and fit for tillage. The rest will, the greater part of them, be allowed to lie waste, producing scarce any thing but some miserable pasture, just sufficient to keep alive a few straggling, half–starved cattle; the farm, though much understocked in proportion to what would be necessary for its complete cultivation, being very frequently overstocked in proportion to its actual produce. A portion of this waste land, however, after having been pastured in this wretched manner for six or seven years together, may be ploughed up, when it will yield, perhaps, a poor crop or two of bad oats, or of some other coarse grain, and then, being entirely exhausted, it must be rested and pastured again as before and another portion ploughed up to be in the same manner exhausted and rested again in its turn. Such accordingly was the general system of management all over the low country of Scotland before the union. The lands which were kept constantly well manured and in good condition, seldom exceeded a third or a fourth part of the whole farm, and sometimes did not amount to a fifth or a sixth part of it. The rest were never manured, but a certain portion of them was in its turn, notwithstanding, regularly cultivated and exhausted. Under this system of management, it is evident, even that part of the lands of Scotland which is capable of good cultivation, could produce but little in comparison of what it may be capable of producing. But how disadvantageous soever this system may appear, yet before the union the low price of cattle seems to have rendered it almost unavoidable. If, notwithstanding a great rise in their price, it still continues to prevail through a considerable part of the country, it is owing, in many places, no doubt, to ignorance and attachment to old customs, but in most places to the unavoidable obstructions which the natural course of things opposes to the immediate or speedy establishment of a better system: first, to the poverty of the tenants, to their not having yet had time to acquire a stock of cattle sufficient to cultivate their lands more compleatly, the same rise of price which would render it advantageous for them to maintain a greater stock, rendering it more difficult for them to acquire it; and, secondly, to their not having yet had time to put their lands in condition to maintain this greater stock properly, supposing they were capable of acquiring it. The increase of stock and the improvement of land are two events which must go hand in hand, and of which the one can no where much out–run the other. Without some increase of stock, there can be scarce any improvement of land, but there can be no considerable increase of stock but in consequence of a considerable improvement of land; because otherwise the land could not maintain it. These natural obstructions to the establishment of a better system, cannot be removed but by a long course of frugality and industry; and half a century or a century more, perhaps, must pass away before the old system, which is wearing out gradually, can be compleatly abolished through all the different parts of the country. Of all btheb commercial advantages, however, which Scotland has derived from the union with England, this rise in the price of cattle is, perhaps, the greatest.6 It has not only raised the value of all highland estates, but it has, perhaps, been the principal cause of the improvement of the low country.
4In all new colonies the great quantity of waste land, which can for many years be applied to no other purpose but the feeding of cattle, soon renders them extremely abundant, and in every thing great cheapness is the necessary consequence of great abundance. Though all the cattle of the European colonies in America were originally carried from Europe, they soon multiplied so much there, and became of so little value, that even horses were allowed to run wild in the woods without any owner thinking it worth while to claim them.7 It must be a long time after the first establishment of such colonies, before it can become profitable to feed cattle upon the produce of cultivated land. The same causes, therefore, the want of manure, and the disproportion between the stock employed in cultivation, and the land which it is destined to cultivate, are likely to introduce there a system of husbandry not unlike that which still continues to take place in so many parts of Scotland. Mr. Kalm, the Swedish traveller, when he gives an account of the husbandry of some of the English colonies in North America, as he found it in 1749, observes, accordingly, that he can with difficulty discover there the character of the English nation, so well skilled in all the different branches of agriculture.8 They make scarce any manure for their corn fields, he says; but when one piece of ground has been exhausted by continual cropping, they clear and cultivate another piece of fresh land; and when that is exhausted, proceed to a third. Their cattle are allowed to wander through the woods and other uncultivated grounds, where they are half–starved; having long ago extirpated almost all the annual grasses by cropping them too early in the spring, before they had time to form their flowers, or to shed their seeds* . The annual grasses were, it seems, the best natural grasses in that part of North America; and when the Europeans first settled there, they used to grow very thick, and to rise three or four feet high. A piece of ground which, when he wrote, could not maintain one cow, would in former times, he was assured, have maintained four, each of which would have given four times the quantity of milk, which that one was capable of giving. The poorness of the pasture had, in his opinion, occasioned the degradation of their cattle, which degenerated sensibly from one generation to another. They were probably not unlike that stunted breed which was common all over Scotland thirty or forty years ago, and which is now so much mended through the greater part of the low country, not so much by a change of the breed, though that expedient has been employed in some places, as by a more plentiful method of feeding them.
5Though it is late, therefore, in the progress of improvement before cattle can bring such a price as to render it profitable to cultivate land for the sake of feeding them; yet of all the different parts which compose this second sort of rude produce, they are perhaps the first which bring this price; because till they bring it, it seems impossible that improvement can be brought near even to that degree of perfection to which it has arrived in many parts of Europe.
6As cattle are among the first, so perhaps venison is among the last parts of this sort of rude produce which bring this price. The price of venison in Great Britain; how extravagant soever it may appear, is not near sufficient to compensate the expence of a deer park, as is well known to all those who have had any experience in the feeding of deer. If it was otherwise, the feeding of deer would soon become an article of common farming; in the same manner as the feeding of those small birds called Turdi was among the antient Romans. Varro and Columella assure us that it was a most profitable article.9 The fattening of Ortolans, birds of passage which arrive lean in the country, is said to be so in some parts of France. If venison continues in fashion, and the wealth and luxury of Great Britain increase as they have done for some time past, its price may very probably rise still higher than it is at present.
7Between that period in the progress of improvement which brings to its height the price of so necessary an article as cattle, and that which brings to it the price of such a superfluity as venison, there is a very long interval, in the course of which many other sorts of rude produce gradually arrive at their highest price, some sooner and some later, according to different circumstances.
8Thus in every farm the offals of the barn and stables will maintain a certain number of poultry. These, as they are fed with what would otherwise be lost, are a mere save–all; and as they cost the farmer scarce any thing, so he can afford to sell them for very little. Almost all that he gets is pure gain, and their price can scarce be so low as to discourage him from feeding this number. But in countries ill cultivated, and, therefore, but thinly inhabited, the poultry, which are thus raised without expence, are often fully sufficient to supply the whole demand. In this state of things, therefore, they are often as cheap as butcher’s–meat, or any other sort of animal food. But the whole quantity of poultry, which the farm in this manner produces without expence, must always be much smaller than the whole quantity of butcher’s–meat which is reared upon it; and in times of wealth and luxury what is rare, with only nearly equal merit, is always preferred to what is common.10 As wealth and luxury increase, therefore, in consequence of improvement and cultivation, the price of poultry gradually rises above that of butcher’s–meat, till at last it gets so high that it becomes profitable to cultivate land for the sake of feeding them. When it has got to this height, it cannot well go higher. If it did, more land would soon be turned to this purpose. In several provinces of France, the feeding of poultry is considered as a very important article in rural œconomy, and sufficiently profitable to encourage the farmer to raise a considerable quantity of Indian corn and buck–wheat for this purpose. A middling farmer will there sometimes have four hundred fowls in his yard. The feeding of poultry seems scarce yet to be generally considered as a matter of so much importance in England. They are certainly, however, dearer in England than in France, as England receives considerable supplies from France. In the progress of improvement, the period at which every particular sort of animal food is dearest, must naturally be that which immediately precedes the general practice of cultivating land for the sake of raising it. For some time before this practice becomes general, the scarcity must necessarily raise the price. After it has become general, new methods of feeding are commonly fallen upon, which enable the farmer to raise upon the same quantity of ground a much greater quantity of that particular sort of animal food. The plenty not only obliges him to sell cheaper, but in consequence of these improvements he can afford to sell cheaper; for if he could not afford it, the plenty would not be of long continuance. It has been probably in this manner that the introduction of clover, turnips, carrots, cabbages, &c. has contributed to sink the common price of butcher’s–meat in the London market somewhat below what it was about the beginning of the last century.11
9 The hog, that finds his food among ordure, and greedily devours many things rejected by every other useful animal, is, like poultry, originally kept as a save–all. As long as the number of such animals, which can thus be reared at little or no expence, is fully sufficient to supply the demand, this sort of butcher’s–meat comes to market at a much lower price than any other. But when the demand rises beyond what this quantity can supply, when it becomes necessary to raise food on purpose for feeding and fattening hogs, in the same manner as for feeding and fattening other cattle, the price necessarily rises, and becomes proportionably either higher or lower than that of other butcher’s–meat, according as the nature of the country, and the state of its agriculture, happen to render the feeding of hogs more or less expensive than that of other cattle. In France, according to Mr. Buffon,12 the price of pork is nearly equal to that of beef. In most parts of Great Britain it is at present somewhat higher.
10The great rise in the price both of hogs and poultry has in Great Britain been frequently imputed to the diminution of the number of cottagers and other small occupiers of land; an event which has in every part of Europe been the immediate fore–runner of improvement and better cultivation, but which at the same time may have contributed to raise the price of those articles, both somewhat sooner and somewhat faster than it would otherwise have risen.13 As the poorest family can often maintain a cat or a dog, without any expence; so the poorest occupiers of land can commonly maintain a few poultry, or a sow and a few pigs, at very little. The little offals of their own table, their whey, skimmed milk, and butter–milk, supply those animals with a part of their food, and they find the rest in the neighbouring fields without doing any sensible damage to any body. By diminishing the number of those small occupiers, therefore, the quantity of this sort of provisions which is thus produced at little or no expence, must certainly have been a good deal diminished, and their price must consequently have been raised both sooner and faster than it would otherwise have risen. Sooner or later, however, in the progress of improvement, it must at any rate have risen to the utmost height to which it is capable of rising; or to the price which pays the labour and expence of cultivating the land which furnishes them with food as well as these are paid upon the greater part of dotherd cultivated land.
11The business of the dairy, like the feeding of hogs and poultry, is originally carried on as a save–all. The cattle necessarily kept upon the farm, produce more milk than either the rearing of their own young, or the consumption of the farmer’s family requires; and they produce most at one particular season. But of all the productions of land, milk is perhaps the most perishable. In the warm season, when it is most abundant, it will scarce keep four–and–twenty hours. The farmer, by making it into fresh butter, stores a small part of it for a week: by making it into salt butter, for a year: and by making it into cheese, he stores a much greater part of it for several years. Part of all these is reserved for the use of his own family. The rest goes to market, in order to find the best price which is to be had, and which can scarce be so low as to discourage him from sending thither whatever is over and above the use of his own family. If it is very low, indeed, he will be likely to manage his dairy in a very slovenly and dirty manner, and will scarce perhaps think it worth while to have a particular room or building on purpose for it, but will suffer the business to be carried on amidst the smoke, filth, and nastiness of his own kitchen; as was the case of almost all the farmers dairies in Scotland thirty or forty years ago, and as is the case of many of them still. The same causes which gradually raise the price of butcher’s–meat, the increase of the demand, and, in consequence of the improvement of the country, the diminution of the quantity which can be fed at little or no expence, raise, in the same manner, that of the produce of the dairy, of which the price naturally connects with that of butcher’s–meat, or with the expence of feeding cattle. The increase of price pays for more labour, care, and cleanliness. The dairy becomes more worthy of the farmer’s attention, and the quality of its produce gradually improves. The price at last gets so high that it becomes worth while to employ some of the most fertile and best cultivated lands in feeding cattle merely for the purpose of the dairy; and when it has got to this height, it cannot well go higher. If it did, more land would soon be turned to this purpose. It seems to have got to this height through the greater part of England, where much good land is commonly employed in this manner. If you except the neighbourhood of a few considerable towns, it seems not yet to have got to this height any where in Scotland, where common farmers seldom employ much good land in raising food for cattle merely for the purpose of the dairy. The price of the produce, though it has risen very considerably within these few years, is probably still too low to admit of it. The inferiority of the quality, indeed, compared with that of the produce of English dairies, is fully equal to that of the price. But this inferiority of quality is, perhaps, rather the effect of this lowness of price than the cause of it. Though the quality was much better, the greater part of what is brought to market could not, I apprehend, in the present circumstances of the country, be disposed of at a much better price; and the present price, it is probable, would not pay the expence of the land and labour necessary for producing a much better quality. Through the greater part of England, notwithstanding the superiority of price, the dairy is not reckoned a more profitable employment of land than the raising of corn, or the fattening of cattle, the two great objects of agriculture. Through the greater part of Scotland, therefore, it cannot yet be eeven soe profitable.
12 The lands of no country, it is evident, can ever be compleatly cultivated and improved, till once the price of every produce, which human industry is obliged to raise upon them, has got so high as to pay for the expence of compleat improvement and cultivation. In order to do this, the price of each particular produce must be sufficient, first, to pay the rent of good corn land, as it is that which regulates the rent of the greater part of other cultivated land;14 and, secondly, to pay the labour and expence of the farmer as well as they are commonly paid upon good corn–land; or, in other words, to replace with the ordinary profits the stock which he employs about it. This rise in the price of each particular produce, must evidently be previous to the improvement and cultivation of the land which is destined for raising it. Gain is the end of all improvement, and nothing could deserve that name of which loss was to be the necessary consequence. But loss must be the necessary consequence of improving land for the sake of a produce of which the price could never bring back the expence. If the compleat improvement and cultivation of the country be, as it most certainly is, the greatest of all publick advantages, this rise in the price of all those different sorts of rude produce, instead of being considered as a publick calamity, ought to be regarded as the necessary forerunner and attendant of the greatest of all publick advantages.
13This rise too in the nominal or money–price of all those different sorts of rude produce has been the effect, not of any degradation in the value of silver, but of a rise in their real price. They have become worth, not only a greater quantity of silver, but a greater quantity of labour and subsistence than before. As it costs a greater quantity of labour and subsistence to bring them to market, so when they are brought thither, they represent or are equivalent to a greater quantity.
1The third and last sort of rude produce, of which the price naturally rises in the progress of improvement, is that in which the efficacy of human industry, in augmenting the quantity, is either limited or uncertain. Though the real price of this sort of rude produce, therefore, naturally tends to rise in the progress of improvement, yet, according as different accidents happen to render the efforts of human industry more or less successful in augmenting the quantity, it may happen sometimes even to fall, sometimes to continue the same in very different periods of improvement, and sometimes to rise more or less in the same period.
2There are some sorts of rude produce which nature has rendered a kind of appendages to other sorts; so that the quantity of the one which any country can afford, is necessarily limited by that of the other. The quantity of wool or of raw hides, for example, which any country can afford, is necessarily limited by the number of great and small cattle that are kept in it. The state of its improvement, and the nature of its agriculture, again necessarily determine this number.
3The same causes, which, in the progress of improvement, gradually raise the price of butcher’s–meat, should have the same effect, it may be thought, upon the prices of wool and raw hides, and raise them too nearly in the same proportion. It probably would be so, if in the rude beginnings of improvement the market for the latter commodities was confined within as narrow bounds as that for the former. But the extent of their respective markets is commonly extremely different.
4The market for butcher’s–meat is almost every–where confined to the country which produces it. Ireland, and some part of British America indeed, carry on a considerable trade in salt provisions; but they are, I believe, the only countries in the commercial world which do so, or which export to other countries any considerable part of their butcher’s–meat.
5The market for wool and raw hides, on the contrary, is in the rude beginnings of improvement very seldom confined to the country which produces them. They can easily be transported to distant countries, wool without any preparation, and raw hides with very little: and as they are the materials of many manufactures, the industry of other countries may occasion a demand for them, though that of the country which produces them might not occasion any.
6In countries ill cultivated, and therefore but thinly inhabited, the price of the wool and the hide bears always a much greater proportion to that of the whole beast, than in countries where, improvement and population being further advanced, there is more demand for butcher’s–meat. Mr. Hume observes, that in the Saxon times, the fleece was estimated at two–fifths of the value of the whole sheep, and that this was much above the proportion of its present estimation.1 In some provinces of Spain, I have been assured, the sheep is frequently killed merely for the sake of the fleece and the tallow. The carcase is often left to rot upon the ground, or to be devoured by beasts and birds of prey. If this sometimes happens even in Spain, it happens almost constantly in Chili, at Buenos Ayres, and in many other parts of Spanish America, where the horned cattle are almost constantly killed merely for the sake of the hide and the tallow.2 This too used to happen almost constantly in Hispaniola, while it was infested by the Buccaneers, and before the settlement, improvement, and populousness of the French plantations (which now extend round the coast of almost the whole western half of the island) had given some value to the cattle of the Spaniards, who still continue to possess, not only the eastern part of the coast, but the whole inland and mountainous part of the country.
7 Though in the progress of improvement and population, the price of the whole beast necessarily rises, yet the price of the carcase is likely to be much more affected by this rise than that of the wool and the hide. The market for the carcase, being in the rude state of society confined always to the country which produces it, must necessarily be extended in proportion to the improvement and population of that country. But the market for the wool and the hides even of a barbarous country often extending to the whole commercial world, it can very seldom be enlarged in the same proportion. The state of the whole commercial world can seldom be much affected by the improvement of any particular country; and the market for such commodities may remain the same or very nearly the same, after such improvements, as before. It should, however, in the natural course of things rather upon the whole be somewhat extended in consequence of them. If the manufactures, especially, of which those commodities are the materials, should ever come to flourish in the country, the market, though it might not be much enlarged, would at least be brought much nearer to the place of growth than before; and the price of those materials might at least be increased by what had usually been the expence of transporting them to distant countries. Though it might not rise therefore in the same proportion as that of butcher’s–meat, it ought naturally to rise somewhat, and it ought certainly not to fall.
8 In England, however, notwithstanding the flourishing state of its woollen manufacture, the price of English wool has fallen very considerably since the time of Edward III. There are many authentick records which demonstrate that during the reign of that prince (towards the middle of the fourteenth century, or about 1339) what was reckoned the moderate and reasonable price of the tod or twenty–eight pounds of English wool was not less than ten shillings of the money of those times* ,3 containing, at the rate of twenty–pence the ounce, six ounces of silver Tower–weight, equal to about thirty shillings of our present money. In the present times, one–and–twenty shillings the tod may be reckoned a good price for very good English wool. The money–price of wool, therefore, in the time of Edward III, was to its money–price in the present times as ten to seven. The superiority of its real price was still greater. At the rate of six shillings and eight–pence the quarter, ten shillings was in those antient times the price of twelve bushels of wheat. At the rate of twenty–eight shillings the quarter, one–and–twenty shillings is in the present times the price of six bushels only. The proportion between the real prices of antient and modern times, therefore, is as twelve to six, or as two to one. In those antient times a tod of wool would have purchased twice the quantity of subsistence which it will purchase at present; and consequently twice the quantity of labour, if the real recompence of labour had been the same in both periods.
9This degradation both in the real and nominal value of wool, could never have happened in consequence of the natural course of things. It has accordingly been the effect of violence and artifice: First, of the absolute prohibition of exporting wool from England;4 Secondly, of the permission of importing it from bSpainb duty free;5 Thirdly, of the prohibition of exporting it from Ireland to any other country but England.6 In consequence of these regulations, the market for English wool, instead of being somewhat extended in consequence of the improvement of England, has been confined to the home market, where the wool of cseveralc other countries is allowed to come into competition with it, and where that of Ireland is forced into competition with it. As the woollen manufactures too of Ireland are fully as much discouraged as is consistent with justice and fair dealing, the Irish can work up but a small part of their own wool at home, and are, therefore, obliged to send a greater proportion of it to Great Britain, the only market they are allowed.7
10I have not been able to find any such authentick records concerning the price of raw hides in antient times. Wool was commonly paid as a subsidy to the king, and its valuation in that subsidy ascertains, at least in some degree, what was its ordinary price. But this seems not to have been the case with raw hides. Fleetwood, however, from an account in 1425, between the prior of Burcester Oxford and one of his canons, gives us their price, at least as it was stated, upon that particular occasion; viz. five ox hides at twelve shillings; five cow hides at seven shillings and three pence; thirty–six dsheepd skins of two years old at nine shillings; sixteen ecalvese skins at two shillings.8 In 1425, twelve shillings contained about the same quantity of silver as four–and–twenty shillings of our present money. An ox hide, therefore, was in this account valued at the same quantity of silver as 4s. ⅘ths of our present money. Its nominal price was a good deal lower than at present. But at the rate of six shillings and eight–pence the quarter, twelve shillings would in those times have purchased fourteen bushels and four–fifths of a bushel of wheat, which, at three and six–pence the bushel, would in the present times cost 51s. 4d. An ox hide, therefore, would in those times have purchased as much corn as ten shillings and three–pence would purchase at present. Its real value was equal to ten shillings and three–pence of our present money. In those antient times, when the cattle were half starved during the greater part of the winter, we cannot suppose that they were of a very large size. An ox hide which weighs four stone of sixteen pounds averdupois, is not in the present times reckoned a bad one; and in those antient times would probably have been reckoned a very good one. But at half a crown the stone, which at this moment (February, 1773) I understand to be the common price, such a hide would at present cost only ten shillings. Though its nominal price, therefore, is higher in the present than it was in those antient times, its real price, the real quantity of subsistence which it will purchase or command, is rather somewhat lower. The price of cow hides, as stated in the above account, is nearly in the common proportion to that of ox hides. That of sheep skins is a good deal above it. They had probably been sold with the wool. That of calves skins, on the contrary, is greatly below it. In countries where the price of cattle is very low, the calves, which are not intended to be reared in order to keep up the stock, are generally killed very young; as was the case in Scotland twenty or thirty years ago. It saves the milk, which their price would not pay for. Their skins, therefore, are commonly good for little.
11The price of raw hides is a good deal lower at present than it was a few years ago; owing probably to the taking off the duty upon seal skins, and to the allowing, for a limited time, the importation of raw hides from Ireland and from the plantations duty free, which was done in 1769.9 Take the whole of the present century at an average, their real price has probably been somewhat higher than it was in those antient times. The nature of the commodity renders it not quite so proper for being transported to distant markets as wool. It suffers more by keeping. A salted hide is reckoned inferior to a fresh one, and sells for a lower price. This circumstance must necessarily have some tendency to sink the price of raw hides produced in a country which does not manufacture them, but is obliged to export them; and comparatively to raise that of those produced in a country which does manufacture them. It must have some tendency to sink their price in a barbarous, and to raise it in an improved and manufacturing country. It must have had some tendency therefore to sink it in antient, and to raise it in modern times. Our tanners besides have not been quite so successful as our clothiers, in convincing the wisdom of the nation, that the safety of the commonwealth depends upon the prosperity of their particular manufacture.10 They have accordingly been much less favoured. The exportation of raw hides has, indeed, been prohibited, and declared a nuisance:11 but their importation from foreign countries has been subjected to a duty;12 and though this duty has been taken off from those of Ireland and the plantations (for the limited time of five years only), yet Ireland has not been confined to the market of Great Britain for the sale of its surplus hides, or of those which are not manufactured at home. The hides of common cattle have but within these few years been put among the enumerated commodities which the plantations can send nowhere but to the mother country; neither has the commerce of Ireland been in this case oppressed hitherto, in order to support the manufactures of Great Britain.
12Whatever regulations tend to sink the price either of wool or of raw hides below what it naturally would be, must, in an improved and cultivated country, have some tendency to raise the price of butcher’s–meat. The price both of the great and small cattle, which are fed on improved and cultivated land, must be sufficient to pay the rent which the landlord, and the profit which the farmer has reason to expect from improved and cultivated land. If it is not, they will soon cease to feed them. Whatever part of this price, therefore, is not paid by the wool and the hide, must be paid by the carcase. The less there is paid for the one, the more must be paid for the other. In what manner this price is to be divided upon the different parts of the beast, is indifferent to the landlords and farmers, provided it is all paid to them. In an improved and cultivated country, therefore, their interest as landlords and farmers cannot be much affected by such regulations, though their interest as consumers may, by the rise in the price of provisions.13 It would be quite otherwise, however, in an unimproved and uncultivated country, where the greater part of the lands could be applied to no other purpose but the feeding of cattle, and where the wool and the hide made the principal part of the value of those cattle. Their interest as landlords and farmers would in this case be very deeply affected by such regulations, and their interest as consumers very little. The fall in the price of the wool and the hide, would not in this case raise the price of the carcase; because the greater part of the lands of the country being applicable to no other purpose but the feeding of cattle, the same number would still continue to be fed. The same quantity of butcher’s–meat would still come to market. The demand for it would be no greater than before. Its price, therefore, would be the same as before. The whole price of cattle would fall, and along with it both the rent and the profit of all those lands of which cattle was the principal produce, that is, of the greater part of the lands of the country. The perpetual prohibition of the exportation of wool, which is commonly, but very falsely, ascribed to Edward III,14 would, in the then circumstances of the country, have been the most destructive regulation which could well have been thought of. It would not only have reduced the actual value of the greater part of the lands of the kingdom, but by reducing the price of the most important species of small cattle, it would have retarded very much its subsequent improvement.
13The wool of Scotland fell very considerably in its price in consequence of the union with England, by which it was excluded from the great market of Europe, and confined to the narrow one of Great Britain.15 The value of the greater part of the lands in the southern counties of Scotland, which are chiefly a sheep country, would have been very deeply affected by this event, had not the rise in the price of butcher’s–meat fully compensated the fall in the price of wool.
14As the efficacy of human industry, in increasing the quantity either of wool or of raw hides, is limited, so far as it depends upon the produce of the country where it is exerted; so it is uncertain so far as it depends upon the produce of other countries. It so far depends, not so much upon the quantity which they produce, as upon that which they do not manufacture; and upon the restraints which they may or may not think proper to impose upon the exportation of this sort of rude produce. These circumstances, as they are altogether independent of domestick industry, so they necessarily render the efficacy of its efforts more or less uncertain. In multiplying this sort of rude produce, therefore, the efficacy of human industry is not only limited, but uncertain.
15In multiplying another very important sort of rude produce, the quantity of fish that is brought to market, it is likewise both limited and uncertain. It is limited by the local situation of the country, by the proximity or distance of its different provinces from the sea, by the number of its lakes and rivers, and by what may be called the fertility or barrenness of those seas, lakes and rivers, as to this sort of rude produce. As population increases, as the annual produce of the land and labour of the country grows greater and greater, there come to be more buyers of fish, and those buyers too have a greater quantity and variety of other goods, or, what is the same thing, the price of a greater quantity and variety of other goods, to buy with. But it will generally be impossible to supply the great and extended market without employing a quantity of labour greater than in proportion to what had been requisite for supplying the narrow and confined one. A market which, from requiring only one thousand, comes to require annually ten thousand ton of fish, can seldom be supplied without employing more than ten times the quantity of labour which had before been sufficient to supply it. The fish must generally be sought for at a greater distance, larger vessels must be employed, and more expensive machinery of every kind made use of. The real price of this commodity, therefore, naturally rises in the progress of improvement. It has accordingly done so, I believe, more or less in every country.
16Though the success of a particular day’s fishing may be a very uncertain matter, yet, the local situation of the country being supposed, the general efficacy of industry in bringing a certain quantity of fish to market, taking the course of a year, or of several years together, it may perhaps be thought, is certain enough; and it, no doubt, is so. As it depends more, however, upon the local situation of the country, than upon the state of its wealth and industry; as upon this account it may in different countries be the same in very different periods of improvement, and very different in the same period; its connection with the state of improvement is uncertain, and it is of this sort of uncertainty that I am here speaking.
17In increasing the quantity of the different minerals and metals which are drawn from the bowels of the earth, that of the more precious ones particularly, the efficacy of human industry seems not to be limited, but to be altogether uncertain.
18The quantity of the precious metals which is to be found in any country is not limited by any thing in its local situation, such as the fertility or barrenness of its own mines. Those metals frequently abound in countries which possess no mines. Their quantity in every particular country seems to depend upon two different circumstances; first, upon its power of purchasing, upon the state of its industry, upon the annual produce of its land and labour, in consequence of which it can afford to employ a greater or a smaller quantity of labour and subsistence in bringing or purchasing such superfluities as gold and silver, either from its own mines or from those of other countries; and, secondly, upon the fertility or barrenness of the mines which may happen at any particular time to supply the commercial world with those metals. The quantity of those metals in the countries most remote from the mines, must be more or less affected by this fertility or barrenness, on account of the easy and cheap transportation of those metals, of their small bulk and great value. Their quantity in China and Indostan must have been more or less affected by the abundance of the mines of America.
19So far as their quantity in any particular country depends upon the former of those two circumstances (the power of purchasing), their real price, like that of all other luxuries and superfluities, is likely to rise with the wealth and improvement of the country, and to fall with its poverty and depression. Countries which have a great quantity of labour and subsistence to spare, can afford to purchase any particular quantity of those metals at the expence of a greater quantity of labour and subsistence, than countries which have less to spare.
20So far as their quantity in any particular country depends upon the latter of those two circumstances (the fertility or barrenness of the mines which happen to supply the commercial world) their real price, the real quantity of labour and subsistence which they will purchase or exchange for, will, no doubt, sink more or less in proportion to the fertility, and rise in proportion to the barrenness of those mines.
21The fertility or barrenness of the mines, however, which may happen at any particular time to supply the commercial world, is a circumstance which, it is evident, may have no sort of connection with the state of industry in a particular country. It seems even to have no very necessary connection with that of the world in general. As arts and commerce, indeed, gradually spread themselves over a greater and a greater part of the earth, the search for new mines, being extended over a wider surface, may have somewhat a better chance for being successful, than when confined within narrower bounds. The discovery of new mines, however, as the old ones come to be gradually exhausted, is a matter of the greatest uncertainty, and such as no human skill or industry can ensure. All indications, it is acknowledged, are doubtful, and the actual discovery and successful working of a new mine can alone ascertain the reality of its value, or even of its existence. In this search there seem to be no certain limits either to the possible success, or to the possible disappointment of human industry. In the course of a century or two, it is possible that new mines may be discovered more fertile than any that have ever yet been known; and it is just equally possible that the most fertile mine then known may be more barren than any that was wrought before the discovery of the mines of America. Whether the one or the other of those two events may happen to take place, is of very little importance to the real wealth and prosperity of the world, to the real value of the annual produce of the land and labour of mankind. Its nominal value, the quantity of gold and silver by which this annual produce could be expressed or represented, would, no doubt, be very different; but its real value, the real quantity of labour which it could purchase or command, would be precisely the same. A shilling might in the one case represent no more labour than a penny does at present; and a penny in the other might represent as much as a shilling does now. But in the one case he who had a shilling in his pocket, would be no richer than he who has a penny at present; and in the other he who had a penny would be just as rich as he who has a shilling now. The cheapness and abundance of gold and silver plate, would be the sole advantage which the world could derive from the one event, and the dearness and scarcity of those trifling superfluities the only inconveniency it could suffer from the other.
[1 ]The same figures are cited above, I.xi.b.12. cf. Steuart, Principles, II.xxx. ‘Quest. 3’.
[2 ]‘There were two kinds of purchase to be carried out, the first of a tithe, the second an additional purchase to be distributed fairly among the various communities. . . . The price fixed was 3 sesterces a peck for the tithe corn and 3½ sesterces a peck for the requisitioned corn’. (Cicero, Verrine Orations, iii.70, translated by L. H. G. Greenwood in Loeb Classical Library (1935), ii.200–1.)
[3 ]See above, I.xi.g.17.
[4 ]Further examples are provided below, IV.ix.47.
[5 ]‘I know of one bird, a white one it is true, which is nearly unprecedented, that was sold for 600,000 sesterces to be given as a present to the emperor Claudius’s consort Agrippina.’ (Pliny, Natural History, X.xliii, translated by H. Rackham in Loeb Classical Library (1950), iii.347.)
[6 ]‘With a fish of this kind one of the proconsulur body, Asinius Celer, in the principate of Gaius, issued a challenge—it is not so easy to say who won the match—to all the spend–thrifts by giving 8,000 sesterces for a mullet.’ (Ibid. IX.xxxi, trans. Rackham, iii.207.)
[1 ]Above, I.xi.e.27.
[2 ]See above, I.xi.b.7, for an analysis of this issue.
[3 ]See I.xi.b.8.
[4 ]Not till almost a century after the Union. The difficulties of wintering cattle proved a major hurdle in the expansion of the Scottish cattle trade.
[5 ]See above, I.xi.b.15 and I.xi.l.8.
[a–a]rises first 1
[6 ]Smith argued that this particular advantage was less likely to accrue to Ireland at IV.ii.17. He describes some of the political advantages arising from union at V.iii.89. In Letter 50 addressed to Strahan, dated 4 April 1760, Smith commented with regard to Scotland that in the short run, Union with England had depressed the dignity of the nobility, gentry, clerical, and even the merchant classes. He added: ‘Nothing, however, appears to me more excusable than the disaffection of Scotland at that time. The Union was a measure from which infinite Good had been derived to this country. The Prospect of that good, however, must then have appeared very remote and very uncertain. . . . The dignity of the nobility was undone by it . . . Even the merchants seemed to suffer at first.’ In connection with the latter point, Smith argued that although the colonial trade was opened as a result of union, Scottish merchants were less familiar with the new trade patterns than they were with the more traditional continental routes, now ‘laid under new embaressments’.
[7 ]See above, I.xi.b.7.
[8 ]‘Aoke Helm . . . upwards of seventy years of age . . . told us, that in his youth there was grass in the woods, which grew very close, and was every where two feet high; but that it was so much lessened at present, that the cattle hardly find food enough, and that therefore four cows now give no more milk than one at that time; but the causes of this alteration are easy to find. In the younger years of old Helm, the country was little inhabited, and hardly the tenth part of the cattle kept which is at present; a cow had therefore as much food at that time, as ten now have. Further, most kinds of grass here are annual . . . they must sow themselves every year . . . The great numbers of cattle hinder this sowing, as the grass is eaten before it can produce flowers and fruit.’ (P. Kalm, Travels into North America, translated by J. R. Forster (Warrington, 1770), i.343–4.)
[9 ]‘Thanks to the expenditure in this way of money and care, so Marcus Terentius [Varro] informs us, these birds were often bought for three denarii a piece in our grandfather’s time, when those who celebrated triumphs gave a feast to the people. But at the present day luxury has made this their everyday price; wherefore this source of income must not be despised even by farmers.’ (Columella, De Re Rustica, viii.10, translated by E. S. Forster and E. H. Heffner in Loeb Classical Library (1954), ii.373–5.) ‘From the aviary alone which is in that villa I happen to know that there were sold 5,000 fieldfares, for three denarii apiece, so that that department of the villa in that year brought in sixty thousand sesterces—twice as much as your farm of 200 iugera at Reate brings in’. (Varro, De Re Rustica, iii.2, translated by W. D. Hooper, revised by H. B. Ash in the Loeb Classical Library (1934), 436–7.)
[10 ]See above, I.xi.c.31.
[11 ]See above, I.xi.b.15 and I.xi.l.2.
[12 ]‘No one who lives in the country is ignorant of the profits arising from the hog; his flesh sells for more than that of the ox.’ (Buffon, Histoire naturelle, translated as Barr’s Buffon’s Natural History (London, 1797), v.299.) In his Edinburgh Review article of 1755, Smith referred to Buffon as a gentleman of ‘the most universally acknowledged merit’ and as being connected with the writing of ‘a compleat system of natural history’.
[13 ]It is remarked above, I.x.b.49, that cottagers still subsist in Scotland, although in smaller numbers than formerly.
[d–d]their 4 <corrected 4e–6>
[14 ]See above, I.xi.b.35.
[1 ]‘A sheep by the laws of Athelstan was estimated at a shilling; that is, fifteen–pence of our money. The fleece was two–fifths of the value of the whole sheep; much above its present estimation; and the reason probably was, that the Saxons, like the ancients, were little acquainted with any clothing but what was made of wool.’ (D. Hume, The History of England (1778), i.226.)
[2 ]‘It is the usual custom to buy the hides of the beast, the carcase being in some measure a gratuitous addition; and the meat is always fat and very palateable.’ (Juan and Ulloa, Voyage historique, i.552, trans. John Adams, ii.187.)
[* ]See Smith’s Memoirs of Wool, avol.i.c.5, 6, and 7; also, vol.ii.c.176.a [In the Parliament of 1339, ‘the Laity granted the King one half of all their Wool for the next Summer. At the same time he took the whole from the Clergy, making them pay nine Marks for every Sack of the best Wool. Which nine Marks per Sack was equal to 14s. per Stone of our present Money.’ John Smith, Chronicon Rusticum Commerciale; or Memoirs of Wool, etc. (London, 1747), i.25, n.]
[3 ]See below, IV.viii.25, where Smith is described as the ‘very accurate and intelligent author of the Memoirs of Wool’.
[4 ]14 Charles II, c.18 (1662) in Statutes of the Realm, v.410–412; 13 and 14 Charles II, c.18 in Ruffhead’s edition. See below, IV.viii.18, IV.viii.33, IV.viii.35, V.ii.k.23.
[b–b]all other countries 1–2
[5 ]H. Saxby, The British Customs (London, 1757), 263, states that Spanish wool for clothing and Spanish felt–wool was duty free.
[6 ]10 William III, c.16 (1698) in Statutes of the Realm, vii.524–8; 10 and 11 William III, c.10 in Ruffhead’s edition.
[7 ]In Letter 201 addressed to Henry Dundas, dated 1 November 1779, and in Letter 202 addressed to Lord Carlisle, dated 8 November 1779, Smith referred to the restraints which had been placed on the Irish woollen industry. He wrote to Carlisle that:
[8 ]W. Fleetwood, Chronicon Preciosum, 100.
[9 ]9 George III, c.39 (1769), extended by 14 George III, c.86 (1774) and 21 George III, c.29 (1781). See below, IV.viii.3.
[10 ]It is stated at IV.viii.17 that the manufacturers of woollen goods had been ‘more successful than any other class of workmen’ in persuading the legislature to give protection to the trade. See generally I.xi.p.10.
[11 ]By 5 Elizabeth I, c.22 (1562), amended and confirmed by 8 Elizabeth I, c.14 (1566), and 18 Elizabeth I, c.9 (1575). 14 Charles II, c.7 (1662) in Statutes of the Realm, v. 397; 13 and 14 Charles II, c.7 in Ruffhead’s edition declares that ‘all such Exportation and Transportation of any Hides or Leather contrary to this Act is hereby adjudged and declared to be a common and publick Nusance’. See below, IV.viii.34.
[12 ]9 Anne, c.12 (1710) in Statutes of the Realm, ix.405–17; 9 Anne, c.11 in Ruffhead’s edition.
[13 ]This passage, from the beginning of the paragraph, is quoted below at IV.viii.26.
[14 ]John Smith (Memoirs of Wool, i.25) commented that the words of the statute ‘are far from implying a fixed Resolution of prohibiting absolutely, for ever, the Exportation of Wool; on the contrary, they only denote at the most a temporary Expedient or Revulsion in Favour of the Woolen Manufacture, then about to be enlarged in England.’
[15 ]An Act of 1704 permitted the export of wool (Acts of the Parliament of Scotland, xi.190) to meet the claims of the politically powerful woolmasters. The wider market gave better prices for Scottish wool, though the removal of cheaper wool was a factor in the collapse of the Scottish woolen industry which had been encouraged by a policy of protection. W. R. Scott, The New Mills Cloth Manufactory (Edinburgh, 1905), lxxix–lxxxiii. The woolmasters suffered by the Union but the major benefit of the Union to the English woollen trade was that of closing an illicit outlet for their wool through Scotland to foreign producers. C. Gulvin, ‘The Union and the Scottish Woollen Industry 1707–1760’, Scottish Historical Review, l (1971), 122–3. In general the Scottish clip was not of interest to the English producers. See also IV.viii.25.
[* ]See Smith’s Memoirs of Wool, avol.i.c.5, 6, and 7; also, vol.ii.c.176.a [In the Parliament of 1339, ‘the Laity granted the King one half of all their Wool for the next Summer. At the same time he took the whole from the Clergy, making them pay nine Marks for every Sack of the best Wool. Which nine Marks per Sack was equal to 14s. per Stone of our present Money.’ John Smith, Chronicon Rusticum Commerciale; or Memoirs of Wool, etc. (London, 1747), i.25, n.]