Econlib

The Library

Other Sites

 Front Page arrow Titles (by Subject) arrow [III.iv] CHAPTER IV: How the Commerce of the Towns contributed to the Improvement of the Country - Glasgow Edition of the Works and Correspondence Vol. 2a An Inquiry Into the Nature and Causes of the Wealth of Nations, Vol. 1

Return to Title Page for Glasgow Edition of the Works and Correspondence Vol. 2a An Inquiry Into the Nature and Causes of the Wealth of Nations, Vol. 1

Search this Title:

[III.iv] CHAPTER IV: How the Commerce of the Towns contributed to the Improvement of the Country - 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 [1776]

Edition used:

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).

Part of: The Glasgow Edition of the Works and Correspondence of Adam Smith, 7 vols.

About Liberty Fund:

Liberty Fund, Inc. is a private, educational foundation established to encourage the study of the ideal of a society of free and responsible individuals.


CHAPTER IV

How the Commerce of the Towns contributed to the Improvement of the Country

1The increase and riches of commercial and manufacturing towns, contributed to the improvement and cultivation of the countries to which they belonged, in three different ways.

2First, by affording a great and ready market for the rude produce of the country, they gave encouragement to its cultivation and further improvement. This benefit was not even confined to the countries in which they were situated, but extended more or less to all those with which they had any dealings. To all of them they afforded a market for some part either of their rude or manufactured produce, and consequently gave some encouragement to the industry and improvement of all. Their own country, however, on account of its neighbourhood, necessarily derived the greatest benefit from this market. Its rude produce being charged with less carriage, the traders could pay the growers a better price for it, and yet afford it as cheap to the consumers as that of more distant countries.

3Secondly, the wealth acquired by the inhabitants of cities was frequently employed in purchasing such lands as were to be sold, of which a great part would frequently be uncultivated.1 Merchants are commonly ambitious of becoming country gentlemen, and when they do, they are generally the best of all improvers.2 A merchant is accustomed to employ his money chiefly in profitable projects; whereas a mere country gentleman is accustomed to employ it chiefly in expence. The one often sees his money go from him and return to him again with a profit: the other, when once he parts with it, very seldom expects to see any more of it. Those different habits naturally affect their temper and disposition in every sort of business. A merchant is commonly a bold; a country gentleman, a timid undertaker. The one is not afraid to lay out at once a large capital upon the improvement of his land, when he has a probable prospect of raising the value of it in proportion to the expence. The other, if he has any capital, which is not always the case, seldom ventures to employ it in this manner. If he improves at all, it is commonly not with a capital, but with what he can save out of his annual revenue. Whoever has had the fortune to live in a mercantile town situated in an unimproved country, must have frequently observed how much more spirited the operations of merchants were in this way, than those of mere country gentlemen. The habits, besides, of order, œconomy and attention, to which mercantile business naturally forms a merchant, render him much fitter to execute, with profit and success, any project of improvement.3

4Thirdly, and lastly, commerce and manufactures gradually introduced order and good government,4 and with them, the liberty and security of individuals, among the inhabitants of the country, who had before lived almost in a continual state of war with their neighbours, and of servile dependency upon their superiors.5 This, though it has been the least observed, is by far the most important of all their effects. Mr. Hume is the only writer who, so far as I know, has hitherto taken notice of it.6

5In a country which has neither foreign commerce, nor any of the finer manufactures, a great proprietor, having nothing for which he can exchange the greater part of the produce of his lands which is over and above the maintenance of the cultivators, consumes the whole in rustick hospitality at home.7 If this surplus produce is sufficient to maintain a hundred or a thousand men, he can make use of it in no other way than by maintaining a hundred or a thousand men. He is at all times, therefore, surrounded with a multitude of retainers and dependants, who having no equivalent to give in return for their maintenance, but being fed entirely by his bounty, must obey him, for the same reason that soldiers must obey the prince who pays them. Therefore the extension of commerce and manufactures in Europe, the hospitality of the rich and the great, from the sovereign down to the smallest baron, exceeded every thing which in the present times we can easily form a notion of. Westminster–hall was the dining–room of William Rufus, and might frequently, perhaps, not be too large for his company.8 It was reckoned a piece of magnificence in Thomas Becket, that he strowed the floor of his hall with clean hay or rushes in the season, in order that the knights and squires, who could not get seats, might not spoil their fine cloaths when they sat down on the floor to eat their dinner.9 The great earl of Warwick is said to have entertained every day at his different manors, thirty thousand people; and though the number here may have been exaggerated, it must, however, have been very great to admit of such exaggeration.10 A hospitality nearly of the same kind was exercised not many years ago in many different parts of the highlands of Scotland. It seems to be common in all nations to whom commerce and manufactures are little known. I have seen, says Doctor Pocock,11 an Arabian chief dine in the streets of a town where he had come to sell his cattle, and invite all passengers, even common beggars, to sit down with him and partake of his banquet.12

6The occupiers of land were in every respect as dependent upon the great proprietor as his retainers.13 Even such of them as were not in a state of villange, were tenants at will, who paid a rent in no respect equivalent to the subsistence which the land afforded them.14 A crown, half a crown, a sheep, a lamb, was some years ago in the highlands of Scotland a common rent for lands which maintained a family. In some places it is so at this day; nor will money at present purchase a greater quantity of commodities there than in other places. In a country where the surplus produce of a large estate must be consumed upon the estate itself, it will frequently be more convenient for the proprietor, that part of it be consumed at a distance from his own house, provided they who consume it are as dependent upon him as either his retainers or his menial servants. He is thereby saved from the embarrassment of either too large a company or too large a family. A tenant at will, who possesses land sufficient to maintain his family for little more than a quit–rent, is as dependent upon the proprietor as any servant or retainer whatever, and must obey him with as little reserve. Such a proprietor, as he feeds his servants and retainers at his own house, so he feeds his tenants at their houses. The subsistence of both is derived from his bounty, and its continuance depends upon his good pleasure.

7Upon the authority which the great proprietors necessarily had in such a state of things over their tenants and retainers, was founded the power of the antient barons.15 They necessarily became the judges in peace, and the leaders in war, of all who dwelt upon their estates.16 They could maintain order and execute the law within their respective demesnes, because each of them could there turn the whole force of all the inhabitants against the injustice of any one. No other person had sufficient authority to do this. The king in particular had not.17 In those antient times he was little more than the greatest proprietor in his dominions, to whom, for the sake of common defence against their common enemies, the other great proprietors paid certain respects. To have enforced payment of a small debt within the lands of a great proprietor, where all the inhabitants were armed and accustomed to stand by one another, would have cost the king, had he attempted it by his own authority, almost the same effort as to extinguish a civil war.18 He was, therefore, obliged to abandon the administration of justice through the greater part of the country, to those who were capable of administering it; and for the same reason to leave the command of the country militia to those whom that militia would obey.

8It is a mistake to imagine that those territorial jurisdictions took their origin from the feudal law. Not only the highest jurisdictions both civil and criminal, but the power of levying troops, of coining money, and even that of making bye–laws for the government of their own people, were all rights possessed allodially by the great proprietors of land several centuries before even the name of the feudal law was known in Europe. The authority and jurisdiction of the Saxon lords in England, aappeara to have been as great before the conquest,19 as that of any of the Norman lords after it. But the feudal law is not supposed to have become the common law of England till after the conquest.20 That the most extensive authority and jurisdictions were possessed by the great lords in France allodially, long before the feudal law was introduced into that country, is a matter of fact that admits of no doubt.21 That authority and those jurisdictions all necessarily flowed from the state of property and manners just now described.22 Without remounting to the remote antiquities of either the French or English monarchies, we may find in much later times many proofs that such effects must always flow from such causes. It is not thirty years ago since Mr. Cameron of Lochiel, a gentleman of Lochabar in Scotland, without any legal warrant whatever, not being what was then called a lord of regality, nor even a tenant in chief, but a vassal of the duke of Argyle, and without being so much as a justice of peace, used, notwithstanding, to exercise the highest criminal jurisdiction over his own people. He is said to have done so with great equity, though without any of the formalities of justice; and it is not improbable that the state of that part of the country at that time made it necessary for him to assume this authority in order to maintain the publick peace.23 That gentleman, whose rent never exceeded five hundred pounds a year, carried, in 1745, eight hundred of his own people into the rebellion with him.24

9 The introduction of the feudal law, so far from extending, may be regarded as an attempt to moderate the authority of the great allodial lords.25 It established a regular subordination, accompanied with a long train of services and duties, from the king down to the smallest proprietor. During the minority of the proprietor, the rent, together with the management of his lands, fell into the hands of his immediate superior, and, consequently, those of all great proprietors into the hands of the king, who was charged with the maintenance and education of the pupil, and who, from his authority as guardian, was supposed to have a right of disposing of him in marriage, provided it was in a manner not unsuitable to his rank.26 But though this institution necessarily tended to strengthen the authority of the king, and to weaken that of the great proprietors, it could not do either sufficiently for establishing order and good government among the inhabitants of the country; because it could not alter sufficiently that state of property and manners from which the disorders arose. The authority of government still continued to be, as before, too weak in the head and too strong in the inferior members, and the excessive strength of the inferior members was the cause of the weakness of the head. After the institution of feudal subordination, the king was as incapable of restraining the violence of the great lords as before. They still continued to make war according to their own discretion, almost continually upon one another, and very frequently upon the king; and the open country still continued to be a scene of violence, rapine, and disorder.27

10But what all the violence of the feudal institutions could never have effected, the silent and insensible operation of foreign commerce and manufactures gradually brought about.28 These gradually furnished the great proprietors with something for which they could exchange the whole surplus produce of their lands, and which they could consume themselves without sharing it either with tenants or retainers.29 All for ourselves, and nothing for other people, seems, in every age of the world, to have been the vile maxim of the masters of mankind. As soon, therefore, as they could find a method of consuming the whole value of their rents themselves, they had no disposition to share them with any other persons.30 For a pair of diamond buckles perhaps, or for something as frivolous and useless, they exchanged the maintenance, or what is the same thing, the price of the maintenance of a thousand men for a year, and with it the whole weight and authority which it could give them.31 The buckles, however, were to be all their own, and no other human creature was to have any share of them; whereas in the more antient method of expence they must have shared with at least a thousand people. With the judges that were to determine the preference, this difference was perfectly decisive; and thus, for the gratification of the most childish, the meanest and the most sordid of all vanities, they gradually bartered their whole power and authority.32

11In a country where there is no foreign commerce, nor any of the finer manufactures, a man of ten thousand a year cannot well employ his revenue in any other way than in maintaining, perhaps, a thousand families, who are all of them necessarily at his command.33 In the present state of Europe, a man of ten thousand a year can spend his whole revenue, and he generally does so, without directly maintaining twenty people, or being able to command more than ten footmen not worth the commanding.34 Indirectly, perhaps, he maintains as great or even a greater number of people than he could have done by the antient method of expence. For though the quantity of precious productions for which he exchanges his whole revenue be very small, the number of workmen employed in collecting and preparing it, must necessarily have been very great. Its great price generally arises from the wages of their labour, and the profits of all their immediate employers. By paying that price he indirectly pays all those wages and profits, and thus indirectly contributes to the maintenance of all the workmen and their employers.35 He generally contributes, however, but a very small proportion to that of each, to very few perhaps a tenth, to many not a hundredth, and to some not a thousandth, nor even a ten thousandth part of their whole annual maintenance. Though he contributes, therefore, to the maintenance of them all, they are all more or less independent of him, because generally they can all be maintained without him.36

12When the great proprietors of land spend their rents in maintaining their tenants and retainers, each of them maintains entirely all his own tenants and all his own retainers. But when they spend them in maintaining tradesmen and artificers, they may, all of them taken together, perhaps, maintain as great, or, on account of the waste which attends rustick hospitality, a greater number of people than before. Each of them, however, taken singly, contributes often but a very small share to the maintenance of any individual of this greater number. Each tradesman or artificer derives his subsistence from the employment, not of one, but of a hundred or a thousand different customers. Though in some measure obliged to them all, therefore, he is not absolutely dependent upon any one of them.

13The personal expence of the great proprietors having in this manner gradually increased, it was impossible that the number of their retainers should not as gradually diminish, till they were at last dismissed altogether. The same cause gradually led them to dismiss the unnecessary part of their tenants. Farms were enlarged, and the occupiers of land, notwithstanding the complaints of depopulation, reduced to the number necessary for cultivating it, according to the imperfect state of cultivation and improvement in those times. By the removal of the unnecessary mouths, and by exacting from the farmer the full value of the farm, a greater surplus, or what is the same thing, the price of a greater surplus, was obtained for the proprietor, which the merchants and manufacturers soon furnished him with a method of spending upon his own person in the same manner as he had done the rest. The same cause continuing to operate, he was desirous to raise his rents above what his lands, in the actual state of their improvement, could afford. His tenants could agree to this upon one condition only, that they should be secured in their possession, for such a term of years as might give them time to recover with profit whatever they should lay out in the further improvement of the land. The expensive vanity of the landlord made him willing to accept of this condition; and hence the origin of long leases.37

14Even a tenant at will, who pays the full value of the land, is not altogether dependent upon the landlord. The pecuniary advantages which they receive from one another, are mutual and equal, and such a tenant will expose neither his life nor his fortune in the service of the proprietor. But if he has a lease for a long term of years, he is altogether independent; and his landlord must not expect from him even the most trifling service beyond what is either expressly stipulated in the lease, or imposed upon him by the common and known law of the country.

15The tenants having in this manner become independent, and the retainers being dismissed, the great proprietors were no longer capable of interrupting the regular execution of justice, or of disturbing the peace of the country. Having sold their birth–right, not like Esau for a mess of pottage in time of hunger and necessity, but in the wantonness of plenty, for trinkets and baubles, fitter to be the play–things of children than the serious pursuits of men, they became as insignificant as any substantial burgher or tradesman in a city. A regular government was established in the country as well as in the city, nobody having sufficient power to disturb its operations in the one, any more than in the other.38

16It does not, perhaps, relate to the present subject, but I cannot help remarking it, that very old families, such as have possessed some considerable estate from father to son for many successive generations, are very rare in commercial countries. In countries which have little commerce, on the contrary, such as Wales or the highlands of Scotland, they are very common.39 The Arabian histories seem to be all full of genealogies, and there is a history written by a Tartar Khan, which has been translated into several European languages, and which contains scarce any thing else;40 a proof that antient families are very common among those nations. In countries where a rich man can spend his revenue in no other way than by maintaining as many people as it can maintain, he is not apt to run out, and his benevolence it seems is seldom so violent as to attempt to maintain more than he can afford. But where he can spend the greatest revenue upon his own person, he frequently has no bounds to his expence, because he frequently has no bounds to his vanity, or to his affection for his own person. In commercial countries, therefore, riches, in spite of the most violent regulations of law to prevent their dissipation, very seldom remain long in the same family. Among simple nations, on the contrary, they frequently do without any regulations of law; for among nations of shepherds, such as the Tartars and Arabs, the consumable nature of their property necessarily renders all such regulations impossible.

17A revolution of the greatest importance to the publick happiness, was in this manner brought about by two different orders of people, who had not the least intention to serve the publick. To gratify the most childish vanity was the sole motive of the great proprietors. The merchants and artificers, much less ridiculous, acted merely from a view to their own interest, and in pursuit of their own pedlar principle of turning a penny wherever a penny was to be got. Neither of them had either knowledge or foresight of that great revolution which the folly of the one, and the industry of the other, was gradually bringing about.41

18It is thus that through the greater part of Europe the commerce and manufactures of cities, instead of being the effect, have been the cause and occasion of the improvement and cultivation of the country.

19This order, however, being contrary to the natural course of things, is necessarily both slow and uncertain. Compare the slow progress of those European countries of which the wealth depends very much upon their commerce and manufactures, with the rapid advances of our North American colonies, of which the wealth is founded altogether in agriculture.42 Through the greater part of Europe, the number of inhabitants is not supposed to double in less than five hundred years. In several of our North American colonies, it is found to double in twenty or five–and–twenty years.43 In Europe, the law of primogeniture, and perpetuities of different kinds, prevent the division of great estates, and thereby hinder the multiplication of small proprietors.44 A small proprietor, however, who knows every part of his little territory, bwhob views it cwith allc the affection which property, especially small property, naturally inspires, and who upon that account takes pleasure not only in cultivating but in adorning it, is generally of all improvers the most industrious, the most intelligent, and the most successful.45 The same regulations, besides, keep so much land out of the market, that there are always more capitals to buy than there is land to sell, so that what is sold always sells at a monopoly price. The rent never pays the interest of the purchase–money, and is besides burdened with repairs and other occasional charges, to which the interest of money is not liable. To purchase land is every where in Europe a most unprofitable employment of a small capital. For the sake of the superior security, indeed, a man of moderate circumstances, when he retires from business, will sometimes chuse to lay out his little capital in land. A man of profession too, whose revenue is derived from another source, often loves to secure his savings in the same way. But a young man, who, instead of applying to trade or to some profession, should employ a capital of two or three thousand pounds in the purchase and cultivation of a small piece of land, might indeed expect to live very happily, and very independently, but must bid adieu, for ever, to all hope of either great fortune or great illustration, which by a different employment of his stock he might have had the same chance of acquiring with other people. Such a person too, though he cannot aspire at being a proprietor, will often disdain to be a farmer. The small quantity of land, therefore, which is brought to market, and the high price of what is brought dthitherd prevents a great number of capitals from being employed in its cultivation and improvement which would otherwise have taken that direction. In North America, on the contrary, fifty or sixty pounds is often found a sufficient stock to begin a plantation with. The purchase and improvement of uncultivated land, is there the most profitable employment of the smallest as well as of the greatest capitals, and the most direct road to all the fortune and illustration which can be acquired in that country. Such land, indeed, is in North America to be had almost for nothing, or at a price much below the value of the natural produce; a thing impossible in Europe, or, indeed, in any country where all lands have long been private property.46 If landed estates, however, were divided equally among all the children, upon the death of any proprietor who left a numerous family, the estate would generally be sold. So much land would come to market, that it could no longer sell at a monopoly price. The free rent of the land would go nearer to pay the interest of the purchase–money, and a small capital might be employed in purchasing land as profitably as in any other way.

20England, on account of the natural fertility of the soil, of the great extent of ethee sea–coast in proportion to that of the whole country, and of the many navigable rivers which run through it, and afford the conveniency of water carriage to some of the most inland parts of it, is perhaps as well fitted by nature as any large country in Europe, to be the seat of foreign commerce, of manufactures for distant sale, and of all the improvements which these can occasion. From the beginning of the reign of Elizabeth too, the English legislature has been peculiarly attentive to the interests of commerce and manufactures, and in reality there is no country in Europe, Holland itself not excepted, of which the law is, upon the whole, more favourable to this sort of industry. Commerce and manufactures have accordingly been continually advancing during all this period. The cultivation and improvement of the country has, no doubt, been gradually advancing too: But it seems to have followed slowly, and at a distance, the more rapid progress of commerce and manufactures. The greater part of the country must probably have been cultivated before the reign of Elizabeth; and a very great part of it still remains uncultivated, and the cultivation of the far greater part, much inferior to what it might be. The law of England, however, favours agriculture not only indirectly by the protection of commerce, but by several direct encouragements. Except in times of scarcity, the exportation of corn is not only free, but encouraged by a bounty.47 In times of moderate plenty, the importation of foreign corn is loaded with duties that amount to a prohibition.48 The importation of live cattle, except from Ireland, is prohibited at all times,49 and it is but of late that it was permitted from thence.50 Those who cultivate the land, therefore, have a monopoly against their countrymen for the two greatest and most important articles of land produce, bread and butcher’s meat. These encouragements, though at bottom, perhaps, as I shall endeavour to show hereafter,51 altogether illusory, sufficiently demonstrate at least the good intention of the legislature to favour agriculture. But what is of much more importance than all of them, the yeomanry of England are rendered as secure, as independent, and as respectable as law can make them.52 No country, therefore, in which the right of primogeniture takes place, which pays tithes, and where perpetuities, though contrary to the spirit of the law, are admitted in some cases, can give more encouragement to agriculture than England. Such, however, notwithstanding, is the state of its cultivation. What would it have been, had the law given no direct encouragement to agriculture besides what arises indirectly from the progress of commerce, and had left the yeomanry in the same condition as in most other countries of Europe? It is now more than two hundred years since the beginning of the reign of Elizabeth, a period as long as the course of human prosperity usually endures.53

21France seems to have had a considerable share of foreign commerce near a century before England was distinguished as a commercial country. The marine of France was considerable, according to the notions of the times, before the expedition of Charles the VIIIth to Naples. The cultivation and improvement of France, however, is, upon the whole, inferior to that of England. The law of the country has never given the same direct encouragement to agriculture.

22The foreign commerce of Spain and Portugal to the other parts of Europe, though chiefly carried on in foreign ships, is very considerable. That to their colonies is carried on in their own, and is much greater, on account of the great riches and extent of those colonies. But it has never introduced any considerable manufactures for distant sale into either of those countries, and the greater part of both still remains uncultivated. The foreign commerce of Portugal is of older standing than that of any great country in Europe, except Italy.54

23Italy is the only great country of Europe which seems to have been cultivated and improved in every part, by means of foreign commerce and manufactures for distant sale. Before the invasion of Charles the VIIIth, Italy, according to Guicciardin,55 was cultivated not less in the most mountainous and barren parts of the country, than in the plainest and most fertile. The advantageous situation of the country, and the great number of independent states which at that time subsisted in it, probably contributed not a little to this general cultivation. It is not impossible too, notwithstanding this general expression of one of the most judicious and reserved of modern historians, that Italy was not at that time better cultivated than England is at present.

24The capital, however, that is acquired to any country by commerce and manufactures, is all a very precarious and uncertain possession, till some part of it has been secured and realized in the cultivation and improvement of its lands. A merchant, it has been said very properly, is not necessarily the citizen of any particular country. It is in a great measure indifferent to him from what place he carries on his trade; and a very trifling disgust will make him remove his capital, and together with it all the industry which it supports, from one country to another. No part of it can be said to belong to any particular country, till it has been spread as it were over the face of that country, either in buildings, or in the lasting improvement of lands.56 No vestige now remains of the great wealth, said to have been possessed by the greater part of the Hans towns, except in the obscure histories of the thirteenth and fourteenth centuries. It is even uncertain where some of them were situated, or to what towns in Europe the Latin names given to some of them belong. But though the misfortunes of Italy in the end of the fifteenth and beginning of the sixteenth centuries greatly diminished the commerce and manufactures of the cities of Lombardy and Tuscany, those countries still continue to be among the most populous and best cultivated in Europe. The civil wars of Flanders, and the Spanish government which succeeded them, chased away the great commerce of Antwerp, Ghent, and Bruges. But Flanders still continues to be one of the richest, best cultivated, and most populous provinces of Europe. The ordinary revolutions of war and government easily dry up the sources of that wealth which arises from commerce only. That which arises from the more solid improvements of agriculture, is much more durable, and cannot be destroyed but by those more violent convulsions occasioned by the depredations of hostile and barbarous nations continued for a century or two together; such as those that happened for some time before and after the fall of the Roman empire in the western provinces of Europe.

BOOK IV

Of Systems of political Oeconomy

[1 ]See above, I.x.c.26.

[2 ]The merchant improver is contrasted with the country gentleman in LJ (B) 295, ed. Cannan 228. See below, V.ii.a.18 where Smith advocates the sale of Crown lands to those who might improve them, and cf. III.ii.7.

[3 ]For an example of such activities, see T. M. Devine, ‘Glasgow Colonial Merchants and Land, 1770–1815’, in J. T. Ward and R. G. Wilson (eds.), Land and Industry (Newton Abbot, 1971), chapter 6.

[4 ]However, it is pointed out in the concluding sentence of I.xi.n.1 that the abolition of the feudal government in the case of Spain and Portugal had not produced anything better.

[5 ]See above, I.xi.n.1, where the fall of the feudal system is linked with the establishment of a form of government which gives industry the only encouragement which it requires, namely liberty.

[6 ]Hume remarked, for example, that ‘If we consider the matter in a proper light, we shall find, that a progress in the arts is rather favourable to liberty, and has a natural tendency to preserve, if not produce a free government.’ He then described the state of disorder found in ‘rude unpolished nations’ and went on to argue that the development of commerce had the effect of drawing ‘authority and consideration to that middling rank of men, who are the best and firmest basis of public liberty.’ Essays Moral, Political, and Literary, ed. Green and Grose, i.306. He also concluded in the essay ‘Of Commerce’ that ‘The greatness of the sovereign and the happiness of the state are, in a great measure, united with regard to trade and manufactures.’ (Ibid. i.294.) Another close student of Hume’s History, Sir James Steuart, also drew attention to the link between commerce and liberty, and having drawn attention to the changing patterns of dependence, together with changes in the balance of power, made the further comment that ‘When once a state begins to subsist by the consequences of industry, there is less danger to be apprehended from the power of the sovereign. The mechanism of his administration becomes more complex, and . . . he finds himself so bound up by the laws of his political œconomy, that every transgression of them runs him into new difficulties.’ (Principles, i.249, ed. Skinner 217; see especially, II.xiii.) Apart from Steuart, Smith’s comment that Hume was the only writer to have noticed a link between commerce and liberty seems a little odd when it is recalled that a number of works by people known to Smith had included comment on this issue: for example, Adam Ferguson’s History of Civil Society (1767) and Kames’s Sketches of the History of Man (1774). In addition John Millar’s Origin of the Distinction of Ranks (1771), chapter v, provides a close parallel with the argument of the present section. However, of the works written prior to 1776, perhaps William Robertson’s introduction to the History of Charles V (1769) provides the closest parallel to the argument of this book taken as a whole, where he traced the progress of society in Europe from the fall of the Roman empire. It has even been suggested that Robertson owed a good deal to lectures which Smith had delivered in Edinburgh, which, if true, is an interesting commentary on the age of this part of Smith’s work. See, for example, Scott, 55. Smith’s citation of Hume alone among the writers above mentioned may itself be a reflection of the age of this part of his work, and of the fact that Hume was the first author known to Smith to have commented on the subjects of this chapter.

[7 ]With regard to the relationship between dependence and the power of a superior, see below V.i.b.7. See also LJ (B) 21, 51, 159, ed. Cannan 16, 35, 116, where it is remarked that: ‘As the great had no way of spending their fortunes but by hospitality, they necessarily acquired prodigious influence over their vassals.’

[8 ]Smith comments on the hospitality (and enforced frugality) of sovereigns in this situation at IV.i.30 See also V.i.g.22, where he comments on the hospitality of the clergy. Hume describes the rustic hospitality of the great and the general conditions of the economy found in the ‘first and more uncultivated ages of any state’ in his essay ‘Of Money’ Essays Moral, Political and Literary, ed. Green and Grose, i.317.

[9 ]Hume cites the same example in The History of England (1778), i.384.

[10 ]This figure is cited in LJ (A) i.120. Smith also cites the examples of Becket, Warwick, and Rufus, pointing out in the latter case that his hall, ‘now called Westminster Hall, is three hundred feet long and proportionably wide, and was not reckoned too large for a dining room to him and the nobles who attended his court’. In LJ (B) 59, ed. Cannan 42, the number dined by Warwick is given as 40,000 rather than the 30,000 also cited in LJ (A) iv.158. Hume gives the figure of 30,000 in The History of England (1778), iii.182.

[11 ]‘. . . an Arab Prince will often dine in the street, before his door, and call to all that pass, even beggars, in the usual expression, Bismillah, that is, In the name of God; who come and sit down, and when they have done, give their Hamdellilah, that is, God be praised. For the Arabs are great levellers, put everybody on a footing with them; and it is by such generosity and hospitality that they maintain their interest; but the middling people among them, and the Coptis, live but poorly.’ (R. Pococke, A Description of the East and some other Countries (London, 1743), i.183.)

[12 ]In Letter 116 addressed to Lord Hailes, dated 5 March 1769, Smith mentioned an additional problem found in barbarous countries, namely the dependence of travellers on the hospitality of private families, and added that ‘the danger too, of travelling either alone or with few attendants, made all men of any consequence carry along with them a numerous suite of retainers which rendered this Hospitality still more oppressive.’ Smith added that ‘Travelling, from the disorders of the Country, must have been extremely dangerous, & consequently very rare.’

[13 ]In LJ (A) iv.118–19 Smith used the distinction between tenants and retainers to explain a source of disorder within the individual estate. The lord’s ‘tenants naturally hated these idle fellows who eat up the fruits of their labours at their ease, and were allways ready to give their assistance to curb the insolence of his retainers; they again were no less ready to give their assistance to bring the tenants into proper order.’ The same point is made in LJ (B) 51, 204, ed. Cannan 35, 155, where Smith remarked that ‘great numbers of retainers were kept idle about the noblemen’s houses’ as late as the reign of Queen Elizabeth I. Similar points are made in LJ (A) vi.3–7 where Hume’s authority is cited, and see above, II.iii.12.

[14 ]Cf. Steuart: ‘I deduce the origin of the great subordination under the feudal government from the necessary dependence of the lower classes for their subsistence. They consumed the produce of the land, as the price of their subordination, not as the reward of their industry in making it produce.’ (Principles, i.240, ed. Skinner i.208.) Steuart comments extensively on the relation between the degree of dependence and the mode of earning subsistence in II.xiii. LJ (A) i. 119 reads:

The possessors of these farms pay’d a small rent to the possessor rather as an acknowledgment of their dependence than as the value of the land. This rent again he could dispose of no other way than by bestowing it on those who came to his table. The rent of the land was accordingly paid in victualls, and the term Farm signifies properly lands which paid victualls for their rent; the world Farm signifying in the old Saxon or German language victualls.’ See above, I.iv.8. Similar points are made in LJ (A) iv. 135.

[15 ]By implication Smith recognizes the strategic benefits of maintaining a large number of retainers.

[16 ]Cf. LRBL ii.198–9: ‘In the early periods the same persons generally exercise the duties of Judge, General, and Legislator: at least the two former are very commonly conjoined . . . When men, especially in a barbarous state, are accustomed to submit themselves in some points, they naturally do it in others. The same persons therefore who judged them in peace, lead them also to battle.’ (ed. Lothian, 168) See also LJ (B) 141, ed. Cannan 101: ‘By the feudal law, the lord had an absolute sway over his vassals. In peace he was the administrator of justice, and they were obliged to follow him in war.’

[17 ]The inability of the king to enforce payment and to administer justice in the feudal period is mentioned in LJ (A) i.128 and LJ (B) 51, ed. Cannan 36. Hume remarked with reference to Scotland that: ‘Amidst the contentions of such powerful vassals, who may be considered as petty princes rather than eminent nobles, the authority of the king, which was the same with that of the laws, was very uncertain and precarious. Like the Roman pontiff in the ages of superstition, the Scottish monarch, tho’ possessed of extensive claims, enjoyed but little power; and when provoked by the rebellion of any potent baron, his usual resource was to animate some hostile clans against him, and to arm them with legal authority.’ (History of England (1754), i.60–1.)

[18 ]A similar point is made above, III.iii.8. Hume highlights the weak position of the monarch when considering the case of the Earl of Warwick: ‘The military men, allured by his munificence and hospitality, as well as by his bravery, were zealously attached to his interests: His numerous retainers were more devoted to his will, than to the prince or to the laws: And he was the greatest, as well as the last, of those mighty barons, who formerly overawed the crown, and rendered the people incapable of any regular system of civil government.’ (History of England (1778), iii.182.)

[a–a]appears 1–2

[19 ]According to Hume ‘The great influence of the lords over their slaves and tenants, the clientship of the burghers, the total want of a middling rank of men, the extent of the monarchy, the loose execution of the laws, the continued disorders and convulsions of the state; all these circumstances evince, that the Anglo–Saxon government became at last extremely aristocratical.’ The History of England (1778), i.214–15.

[20 ]Smith states that the allodial system preceded the feudal in LJ (A) i.122 and argues that there ‘is no mention of the word feodum in the English law till a few years after the Norman conquest, nor in the French till after the time of 50 or 60 years after Conrad.’ A similar point is made in LJ (B) 54–5, ed. Cannan 38, and the argument is elaborated in LJ (A) iv where Smith cites the authority of Spelman, ‘tho he does not seem to have understood it’, and that of Bouquet who is said to have ‘explaind it extremely well’. (132). Smith suggests at p. 134 that the change from allodial to feudal ‘happend in the whole of Europe about the 9th, 10th and 11th centuries’. The contrast between the two forms of constitution is explained in LJ (A) i.67 where Smith refers to countries where lands were ‘what we call allodial, i.e. held of no one, but were intirely the property of the proprietor, so that the state could not limit the use he was to make of any part of his estate. But in the feudal governments, the king was considered as the dominus directus, which had then a considerable benefit attending on it.’ The allodial system is described in LJ (B) 49–52, ed. Cannan 34–6, and in LJ (A) iv.121–4, where the popular courts which feature in this system are also mentioned. It is stated in LJ (A) iv.137 that the feudal government ‘took away every thing which was popular in the allodial form’. The transition from allodial to feudal is also described in LJ (B) 52–7, ed. Cannan 36–40. The distinction between allodial and feudal would also appear to have been grasped also by Montesquieu. See for example, Esprit, XXXI.viii. Hume also remarked that the Saxons ‘found no occasion for the feudal institutions’, and that William I ‘introduced into England the feudal law, which he found established in France and Normandy’ (History of England (1778), i.225 and 253).

[21 ]See below, V.i.a.7, where Smith refers to ‘what is properly called the feudal law’.

[22 ]A similar argument appears at V.i.b.7, where Smith considers the great authority enjoyed by the Tartar (shepherd) chiefs.

[23 ]Lochiel’s situation was not necessarily so devoid of legal authority as Smith implies. Lochiel, and others, could possess baronial rights, derived from their subject superior, in Lochiel’s case from Argyll. No written charter need exist, so long as the rights were customarily recognized. The judicial functions of Cameron of Lochiel are mentioned in LJ (A) i.129. In LJ (B) 159, ed. Cannan 116, Smith notes that ‘So lately as in the year 1745 this power remained in the Highlands of Scotland, and some gentlemen could bring several hundreds of men into the field’, and he remarks at 171, ed. Cannan 126, that in general the ‘duty of vassals to their lords continued longer in Scotland than in England’. In an interesting comment on Scottish affairs, Smith stated in LJ (A) ii.174 that Lochiel’s relative, Dr. Cameron, was ‘executed in the year ’50 or ’51 on the sentence passed on him in the year 1745. The government were then not altogether free from the fear of another rebellion, and thought it necessary to take that precaution. But had he kept out of the way for some years longer he would probably have been altogether safe.’ See also LJ (B) 200, ed. Cannan 152.

[24 ]The Highlanders are described at V.i.a.26 as ‘stationary shepherds’ unwilling to stay in arms for long periods, or to travel great distances from home—as the events of the ’45 Rebellion had proved.

[25 ]It is remarked in LJ (B) 55, ed Cannan 38–9, that ‘these historians who give an account of the origin of feudal laws from the usurpation of the nobility are quite mistaken’ since ‘it required great influence in the king to make the lords hold their land feudally’. The same point is made in LJ (A) iv.133–4, where Smith also dates the beginning of orderly government from the introduction of the feudal system, remarking that ‘the times after the conquest seem clear and enlightend compared with those of the Saxon race’. Smith argues in the same way that in France comparative order was to be found in the times of Hugh Capet as contrasted with the situation under the ‘Merovingian and Carlovingian races’. An account of the introduction of feudal law is given by Montesquieu, Esprit, XXXI.xxx.

[26 ]The burdens of wardship and marriage are mentioned in LJ (A) i.125–7, ii.17–18, and iv.128; LJ (B) 160, ed. Cannan 117. See below, V.ii.h.5, 6.

[27 ]Cf. LJ (A) i.127–8: ‘It is to be observed that this government was not at all cut out for maintaining civill government, or Police. The king had property in the land superior indeed to what the others had, but not so greatly superior as that they had any considerable power over them. The only person who had any command in the remoter parts of the kingdom was the superior or lord.’ A similar point is made in LJ (A) iv.119. See above, I.xi.e.23. Smith also refers to ‘feudal anarchy’ at III.ii.7. He comments on the superior power of the clergy as compared to the temporal lords at V.i.g.22, attributing this to their unity of interest.

[28 ]Cf. LJ (A) iv.157: ‘the power of the nobles . . . declin’d in the feudall governments from the same causes as everywhere else, viz, from the introduction of arts, commerce, and luxury.’ Cf. LJ (B) 36, ed. Cannan 25. In referring to the transition from the feudal state, Kames remarked that ‘after the Arts of Peace began to be cultivated, Manufactures and Trade to revive in Europe, and Riches to encrease, this institution behoved to turn extreme burdensome. It first tottered, and then fell by its own Weight, as wanting a solid Foundation.’ (Essays upon several Subjects Concerning British Antiquities (Edinburgh, 1747), 155.)

[29 ]By contrast, Montesquieu remarks that in Poland, despite the introduction of foreign commerce, some of the lords ‘possess entire provinces; they oppress the husbandmen, in order to have greater quantities of corn, which they send to strangers, to procure the superfluous demands of luxury. If Poland had no foreign trade, its inhabitants would be happier.’ Montesquieu seems to attribute the fact that the riches of the great had done little or nothing, directly or indirectly, to encourage domestic manufactures to the sheer size of their land holdings. Montesquieu, Esprit, XX.xxiii.4. See below, n. 38.

[30 ]Cf. LJ (A) i.117: ‘men are so selfish that when they have an opportunity of laying out on their own persons what they possess, tho on things of no value, they will never think of giving it to be bestowed on the best purposes by those who stand in need of it.’ It is also stated in LJ (A) vi.7 that commerce gives the rich ‘an opportunity of spending their fortunes with fewer servants, which they never fail of embracing’. Smith comments in this context on the improvement of manners which arises as a result of reducing the number of retainers. See also LJ (B) 205–6, ed. Cannan 155–6 and cf. II.iii.12. The same theme is developed in Hume’s History of England (1778), iii.400:

The encrease of the arts, more effectually than all the severities of law, put an end to the pernicious practice [of maintaining armies of retainers]. The nobility, instead of vying with each other, in the number and boldness of their retainers, acquired by degrees a more civilized species of emulation, and endeavoured to excel in the splendour and elegance of their equipage, houses, and tables. The common people, no longer maintained in vicious idleness by their superiors, were obliged to learn some calling or industry, and became useful both to themselves and to others . . . Hume also noted in his essay ‘Of Refinement in the Arts’ (Essays Moral, Political, and Literary, ed. Green and Grose, i.301), that: Another advantage of industry and of refinements in the mechanical arts, is, that they commonly produce some refinements in the liberal; nor can one be carried to perfection, without being accompanied, in some degree, with the other. The same age, which produces great philosophers and politicians, renowned generals and poets, usually abounds with skilful weavers, and ship–carpenters.

[31 ]LJ (A) i.117–18 comments on the limited dependence of the tradesman and adds: ‘This manner of laying out ones money is the chief cause that the balance of property conferrs so small a superiority of power in modern times. A tradesman to retain your custom, may perhaps vote for you in an election, but you need not expect that he will attend you to battle.’ In LRBL ii.144, ed. Lothian 144, the same point is made with reference to Greek experience; commerce and luxury ‘gave the lowest an opportunity of raising themselves to an equality with the nobles, and the nobles an easy way of reducing themselves to the state of the meanest citizen’. See especially lectures 25 and 26. Cf. LJ (B) 36, ed. Cannan 25: ‘When a man becomes capable of spending on domestic luxury what formerly supported an hundered retainers, his power and influence naturaly decrease.’ See also LJ (B) 59, ed. Cannan 42, and below, V.iii.3.

[32 ]Smith examines the breakdown in the power of the clergy at V.i.g.24, 25, and attributes it to the same process. He suggests, however, that this decline took place more rapidly than in the case of the lords. See also IV.i.30.

[33 ]Cf. LJ (A) iii.135: ‘A man who consumes 10,000 pounds appears to destroy what ought to give maintenance to 1000 men. He therefore appears to be the most destructive member of society we can possibly conceive. But if we observe this man we will find that he is in no way prejudiciall to society, but rather of advantage to it.’ A similar example occurs in LJ (A) i.119.

[34 ]A similar point is made at V.i.b.7 where it is stated that the power of the landlord in an opulent state must be diminished, since ‘as he gives scarce any thing to any body but in exchange for an equivalent, there is scarce any body who considers himself as entirely dependent upon him’.

[35 ]See above, I.xi.c.7.

[36 ]Cf. III.i.5, where Smith comments on the attitude of the American colonists to even this degree of dependence.

[37 ]The same point is made with regard to the clergy as landowners at V.i.g.25.

[38 ]This general statement is further qualified in LJ (A) iv.166: ‘The ruin of the feudall government which followed on arts and luxury had a very different effect in Germany: it occasioned the increase of the power and absolute authority of the great nobles or princes of the empire, and not of the emperor.’ This is explained as being due to the sheer size of the country and the extent of the fortunes held by the nobility. See LJ (A) iv.161–4, LJ (B) 60, ed. Cannan 43, and above, n. 29. Smith comments on the military consequences of this situation, and of the decay of the feudal militia, at V.i.a.37.

[39 ]In TMS VI.ii.1.12 Smith commented on the importance of family in another sense, with regard to pastoral communities: an ‘extensive regard to kindred is said to take place among the Tartars, the Arabs, the Turkomans, and, I believe, among all other nations who are nearly in the same state of society in which the Scots Highlanders were about the beginning of the present century.’ Smith contrasts this situation with that prevailing in commercial countries.

[40 ]It is remarked in LJ (B) 28, ed. Cannan 20, that ‘In no age is antiquity of family more respected than in this’, and in LJ (A) iv.44, with regard to the respect shown for antiquity and family at certain stages of society, Smith refers to a history recently translated from the French (in turn translated from the Swedish) of a man taken prisoner while with Charles XII of Sweden, and carried into Russia. Smith refers to this history as providing ‘just such an account as we should expect to meet with in the history of one of the clans in the remoter parts of this country’. In the same place, Smith points out that ‘the Jews, who were originally a tribe of Arabs, paid the greatest respect to genealogies and were at great pains to preserve them.’ It is stated at V.i.b.10 with regard to the shepherd state that there are ‘no nations . . . who abound more in families revered and honoured on account of their descent . . .’

[41 ]A similar form of argument is used below when speaking of the collapse in the temporal power of the clergy. V.i.g.24.

[42 ]See above, II.v.21 and IV.vii.b.17.

[43 ]The same figures are cited above, I.viii.23.

[44 ]See above, III.ii.2, and below, IV.vii.b.19.

[b–b]om. 5–6

[c–c]all with 1

[45 ]See above, III.ii.7, where Smith comments that great proprietors are seldom great improvers, and III.iv.3, where it is stated that merchants are the best of all. Smith also recommends the sale of crown lands to accelerate improvement at V.ii.a.18.

[d–d]2–6

[46 ]See below, IV.vii.b.2.

[e–e]2–6

[47 ]See above, I.xi.g.4, and below, IV.v.a.5, IV.v.b.37, V.ii.k.13.

[48 ]22 Charles II, c.13 (1670). See below, IV.ii.1, IV.ii.16, IV.v.a.23, IV.v.b.33 and 37, IV.vii.b.33, V.ii.k.13.

[49 ]18 and 19 Charles II, c.2 (1666) in Statutes of the Realm, v.597; 18 Charles II, c.2 in Ruffhead’s edition declared that from 2 February 1666 the importation of cattle is a ‘publique and common Nusance’. Earlier 15 Charles II, c.7 (1663) had imposed a levy on any cattle imported: 20s. for each head to the King; 10s to the informer; 10s. to the poor of the parish where the information was laid. See also 32 Charles II, c.2 (1680). See below, IV.ii.1, 16 and V.ii.k.13.

[50 ]32 George II, c.11 (1758), extended by 5 George III, c.10 (1765) and 12 George III, c.2 (1772). See also IV.ii.17 and V.ii.k.13. Salt provisions from Ireland were allowed on payment of duty by 4 George III, c.1 (1763), later extended and without duty by 8 George III, c.9 (1768) and 12 George III, c.2 (1772).

[51 ]See below, IV.ii.16–22, and generally IV.v.b.

[52 ]See above, III.ii.14 and 15.

[53 ]See above, II.v.22. Cantillon, Essai, 244, ed. Higgs 185, also remarked that ‘When a State has arrived at the highest point of wealth . . . it will inevitably fall into poverty by the ordinary course of things.’ He cites as examples the fate of Venice, the Hanseatic Towns, etc. at 246–7, ed. Higgs 187. It is also stated at 312, ed. Higgs 235, that ‘States who rise by trade do not fail to sink afterwards.’ The thesis of ‘growth and decay’ also features in Hume’s essay ‘Of Money’ and in a letter to Lord Kames, dated 4 March 1758, where he says that ‘Great empires, great cities, great commerce, all of them receive a check, not from accidental events, but necessary principles.’ (J. Y. T. Greig, The Letters of David Hume (Oxford, 1932), i.270–2.) The same thesis appears in Hutcheson, System, ii.377, where it is stated that states ‘have within them the seeds of death and destruction’. Sir James Steuart also uses the argument, Principles, i.224–5, ed. Skinner i.195–6, and see also Kame’s Sketches of the History of Man (Edinburgh, 1774), II.iv.

[54 ]See above, I.xi.n.1, where Spain and Portugal are described as the ‘two most beggarly countries in Europe’. It is suggested at IV.vii.c.82 that the colonies of these two countries may give more encouragement to the industry of others than to their own domestic output.

[55 ]Guicciardini, Della Istoria d’Italia (Venice, 1738), i.2. In LRBL ii.69–70, ed. Lothian 110, Guicciardini and Machiavelli are described as ‘the two most famous modern Italian historians’. Machiavelli was especially admired, being ‘of all modern Historians the only one who has contented himself with that which is the chief purpose of History, to relate events and connect them with their causes, without becoming a party on either side.’

[56 ]See above, II.v.14, and below, V.ii.f.6.