The Online Library of Liberty

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• Preface
• Introduction and Plan of the Work
• Book I: Of the Causes of Improvement In the Productive Powers of Labour, and of the Order According to Which Its Produce Is Naturally Distributed Among the Different Ranks of the People
• Chapter I: Of the Division of Labour
• Chapter II: Of the Principle Which Gives Occasion to the Division of Labour
• Chapter III: That the Division of Labour Is Limited By the Extent of the Market 1
• Chapter IV: Of the Origin and Use of Money 1
• Chapter V: Of the Real and Nominal Price of Commodities, Or of Their Price In Labour, and Their Price In Money
• Chapter VI: Of the Component Parts of the Price of Commodities
• Chapter VII: Of the Natural and Market Price of Commodities 1
• Chapter VIII: Of the Wages of Labour
• Chapter IX: Of the Profits of Stock
• Chapter X: Of Wages and Profit In the Different Employments of Labour and Stock
• Chapter XI: Of the Rent of Land
• Book II: Of the Nature, Accumulation, and Employment of Stock
• Introduction
• Chapter I: Of the Division of Stock
• Chapter II: Of Money Considered As a Particular Branch of the General Stock of the Society, Or of the Expence of Maintaining the National Capital
• Chapter III: Of the Accumulation of Capital, Or of Productive and Unproductive Labour
• Chapter IV: Of Stock Lent At Interest
• Chapter V: Of the Different Employment of Capitals
• Book III: Of the Different Progress of Opulence In Different Nations
• Chapter I: Of the Natural Progress of Opulence
• Chapter II: Of the Discouragement of Agriculture In the Antient State of Europe After the Fall of the Roman Empire 1
• Chapter III: Of the Rise and Progress of Cities and Towns, After the Fall of the Roman Empire
• Chapter IV: How the Commerce of the Towns Contributed to the Improvement of the Country
• Book IV: Of Systems of Political Oeconomy
• Introduction
• Chapter I: Of the Principle of the Commercial, Or Mercantile System 1
• Chapter II: Of Restraints Upon the Importation a From Foreign Countries of Such Goods a As Can Be Produced At Home
• Chapter III: Of the Extraordinary Restraints Upon the Importation of Goods of Almost All Kinds, From Those Countries With Which the Balance Is Supposed to Be Disadvantageous
• Chapter IV: Of Drawbacks
• Chapter V: Of Bounties

CHAPTER III

Of the Rise and Progress of Cities and Towns, after the Fall of the Roman Empire

1The inhabitants of cities and towns were, after the fall of the Roman empire, not more favoured than those of the country. They consisted, indeed, of a very different order of people from the first inhabitants of the antient republicks of Greece and Italy. These last were composed chiefly of the proprietors of lands, among whom the publick territory was originally divided, and who found it convenient to build their houses in the neighbourhood of one another, and to surround them with a wall, for the sake of common defence.1 After the fall of the Roman empire, on the contrary, the proprietors of land seem generally to have lived in fortified castles on their own estates, and in the midst of their own tenants and dependants. The towns were chiefly inhabited by tradesmen and mechanicks, who seem in those days to have been of servile, or very nearly of servile condition. The privileges which we find granted by antient charters to the inhabitants of some of the principal towns in Europe, sufficiently shew what they were before those grants.2 The people to whom it is granted as a privilege, that they might give away their own daughters in marriage without the consent of their lord, that upon their death their own children, and not their lord, should succeed to their goods, and that they might dispose of their own effects by will, must, before those grants, have been either altogether, or very nearly in the same state of villanage with the occupiers of land in the country.

2They seem, indeed, to have been a very poor, mean sett of people, who used to travel about with their goods from place to place, and from fair to fair, like the hawkers and pedlars of the present times.3 In all the different countries of Europe then, in the same manner as in several of the Tartar governments of Asia at present, taxes used to be levied upon the persons and goods of travellers, when they passed through certain manors, when they went over certain bridges, when they carried about their goods from place to place in a fair, when they erected in it a booth or stall to sell them in. These different taxes were known in England by the names of passage, pontage, lastage, and stallage.4 Sometimes the king, sometimes a great lord, who had, it seems, upon some occasions, authority to do this, would grant to particular traders, to such particularly as lived in their own demesnes, a general exemption from such taxes. Such traders, though in other respects of servile, or very nearly of servile condition, were upon this account called Free–traders.5 They in return usually paid to their protector a sort of annual poll–tax. In those days protection was seldom granted without a valuable consideration, and this tax might, perhaps, be considered as compensation for what their patrons might lose by their exemption from other taxes. At first, both those poll–taxes and those exemptions seem to have been altogether personal, and to have affected only particular individuals, during either their lives, or the pleasure of their protectors. In the very imperfect accounts which have been published from Domesdaybook, of several of the towns of England, mention is frequently made, sometimes of the tax which particular burghers paid, each of them, either to the king, or to some other great lord, for this sort of protection;6 and sometimes of the general amount only of all those taxes* .

3 But how servile soever may have been originally the condition of the inhabitants of ^bthe^b towns, it appears evidently, that they arrived at liberty and independency much earlier than the occupiers of land in the country. That part of the king’s revenue which arose from such poll–taxes in any particular town, used commonly to be lett in farm, during a term of years for a rent certain, sometimes to the sheriff of the county, and sometimes to other persons. The burghers themselves frequently got credit enough to be admitted to farm the revenues of this sort which arose out of their own town, they becoming jointly and severally answerable for the whole rent* . To lett a farm in this manner was quite agreeable to the usual œconomy of, I believe, the sovereigns of all the different countries of Europe;7 who used frequently to lett whole manors to all the tenants of those manors, they becoming jointly and severally answerable for the whole rent; but in return being allowed to collect it in their own way, and to pay it into the king’s exchequer by the hands of their own bailiff, and being thus altogether freed from the insolence of the king’s officers; a circumstance in those days regarded as of the greatest importance.8

4At first, the farm of the town was probably lett to the burghers, in the same manner as it had been to other farmers, for a term of years only. In process of time, however, it seems to have become the general practice to grant it to them in fee, that is for ever, reserving a rent certain never afterwards to be augmented. The payment having thus become perpetual, the exemptions, in return for which it was made, naturally became perpetual too. Those exemptions, therefore, ceased to be personal, and could not afterwards be considered as belonging to individuals as individuals, but as burghers of a particular burgh, which, upon this account, was called a Free–burgh, for the same reason that they had been called Free–burghers or Free–traders.9

5Along with this grant, the important privileges above mentioned, that they might give away their own daughters in marriage, that their children should succeed to them, and that they might dispose of their own effects by will, were generally bestowed upon the burghers of the town to whom it was given. Whether such privileges had before been usually granted along with the freedom of trade, to particular burghers, as individuals, I know not. I reckon it not improbable that they were, though I cannot produce any direct evidence of it. But however this may have been, the principal attributes of villanage and slavery being thus taken away from them, they now, at least, became really free in our present sense of the word Freedom.

6Nor was this all. They were generally at the same time erected into a commonality or corporation,10 with the privilege of having magistrates and a town–council of their own, of making bye–laws for their own government, of building walls for their own defence, and of reducing all their inhabitants under a sort of military discipline, by obliging them to watch and ward; that is, as antiently understood, to guard and defend those walls against all attacks and surprises by night as well as by day.11 In England they were generally exempted from suit to the hundred and county courts; and all such pleas as should arise among them, the pleas of the crown excepted, were left to the decision of their own magistrates. In other countries much greater and more extensive jurisdictions were frequently granted to them* .

7It might, probably, be necessary to grant to such towns as were admitted to farm their own revenues, some sort of compulsive jurisdiction to oblige their own citizens to make payment. In those disorderly times it might have been extremely inconvenient to have left them to seek this sort of justice from any other tribunal. But it must seem extraordinary that the sovereigns of all the different countries of Europe, should have exchanged in this manner for a rent certain, never more to be augmented, that branch of their revenue, which was, perhaps, of all others the most likely to be improved by the natural course of things, without–either expence or attention of their own: and that they should, besides, have in this manner voluntarily erected a sort of independent republicks in the heart of their own dominions.12

8In order to understand this, it must be remembered, that in those days the sovereign of perhaps no country in Europe, was able to protect, through the whole extent of his dominions, the weaker part of his subjects from the oppression of the great lords.13 Those whom the law could not protect, and who were not strong enough to defend themselves, were obliged either to have recourse to the protection of some great lord, and in order to obtain it to become either his slaves or vassals; or to enter into a league of mutual defence for the common protection of one another. The inhabitants of cities and burghs, considered as single individuals, had no power to defend themselves: but by entering into a league of mutual defence with their neighbours, they were capable of making no contemptible resistance. The lords despised the burghers, whom they considered not only as of a different order, but as a parcel of emancipated slaves, almost of a different species from themselves.14 The wealth of the burghers never failed to provoke their envy and indignation, and they plundered them upon every occasion without mercy or remorse. The burghers naturally hated and feared the lords. The king hated and feared them too; but though perhaps he might despise, he had no reason either to hate or fear the burghers.15 Mutual interest, therefore, disposed them to support the king, and the king to support them against the lords. They were the enemies of his enemies, and it was his interest to render them as secure and independent of those enemies as he could. By granting them magistrates of their own, the privilege of making bye–laws for their own government, that of building walls for their own defence, and that of reducing all their inhabitants under a sort of military discipline, he gave them all the means of security and independency of the barons which it was in his power to bestow. Without the establishment of some regular government of this kind, without some authority to compel their inhabitants to act according to some certain plan or system, no voluntary league of mutual defence could either have afforded them any permanent security, or have enabled them to give the king any considerable support. By granting them the farm of their town in fee, he took away from those whom he wished to have for his friends, and, if one may say so, for his allies, all ground of jealousy and suspicion that he was ever afterwards to oppress them, either by raising the farm rent of their town, or by granting it to some other farmer.

9The princes who lived upon the worst terms with their barons, seem accordingly to have been the most liberal in grants of this kind to their burghs. King John of England,16 for example, appears to have been a most munificent benefactor to his towns* . Philip the First of France lost all authority over his barons. Towards the end of his reign, his son Lewis, known afterwards by the name of Lewis the Fat, consulted, according to Father Daniel,17 with the bishops of the royal demesnes, concerning the most proper means of restraining the violence of the great lords. Their advice consisted of two different proposals. One was to erect a new order of jurisdiction, by establishing magistrates and a town council in every considerable town of his demesnes. The other was to form a new militia, by making the inhabitants of those towns, under the command of their own magistrates, march out upon proper occasions to the assistance of the king. It is from this period, according to the French antiquarians, that we are to date the institution of the magistrates and councils of cities in France.18 It was during the unprosperous reigns of the princes of the house of Suabia that the greater part of the free towns of Germany received the first grants of their privileges, and that the famous Hanseatic19 league first became formidable* .

10The militia of the cities seems, in those times, not to have been inferior to that of the country, and as they could be more readily assembled upon any sudden occasion, they frequently had the advantage in their disputes with the neighbouring lords. In countries, such as Italy and Switzerland, in which, on account either of their distance from the principal seat of government, of the natural strength of the country itself, or of some other reason, the sovereign came to lose the whole of his authority, the cities generally became independent republicks, and conquered all the nobility in their neighbourhood; obliging them to pull down their castles in the country, and to live, like other peaceable inhabitants, in the city.20 This is the short history of the republick of Berne, as well as of several other cities in Switzerland. If you except Venice, for of that city the history is somewhat different, it is the history of all the considerable Italian republicks, of which so great a number arose and perished, between the end of the twelfth and the beginning of the sixteenth century.

11In countries such as France or England, where the authority of the sovereign, though frequently very low, never was destroyed altogether, the cities had no opportunity of becoming entirely independent.21 They became, however, so considerable that the sovereign could impose no tax upon them, besides the stated farm–rent of the town, without their own consent. They were, therefore, called upon to send deputies to the general assembly of the states of the kingdom, where they might join with the clergy and the barons in granting, upon urgent occasions, some extraordinary aid to the king. Being generally too more favourable to his power, their deputies seem, sometimes, to have been employed by him as a counterbalance ^gin those assemblies^g to the authority of the great lords^h . Hence the origin of the representation of burghs in the states general of all the great monarchies in Europe.22

12Order and good government, and along with them the liberty and security of individuals, were, in this manner, established in cities at a time when the occupiers of land in the country were exposed to every sort of violence. But men in this defenceless state naturally content themselves with their necessary subsistence; because to acquire more might only tempt the injustice of their oppressors. On the contrary, when they are secure of enjoying the fruits of their industry, they naturally exert it to better their condition,23 and to acquire not only the necessaries, but the conveniencies and elegancies of life.24 That industry, therefore, which aims at something more than necessary subsistence, was established in cities long before it was commonly practised by the occupiers of land in the country. If in the hands of a poor cultivator, oppressed with the servitude of villanage, some little stock should accumulate, he would naturally conceal it with great care from his master, to whom it would otherwise have belonged, and take the first opportunity of running away to a town. The law was at that time so indulgent to the inhabitants of towns, and so desirous of diminishing the authority of the lords over those of the country, that if he could conceal himself there from the pursuit of his lord for a year, he was free for ever.25 Whatever stock, therefore, accumulated in the hands of the industrious part of the inhabitants of the country, naturally took refuge in cities, as the only sanctuaries in which it could be secure to the person that acquired it.

13The inhabitants of a city, it is true, must always ultimately derive their subsistence, and the whole materials and means of their industry from the country. But those of a city, situated near either the sea–coast or the banks of a navigable river, are not necessarily confined to derive them from the country in their neighbourhood.26 They have a much wider range, and may draw them from the most remote corners of the world, either in exchange for the manufactured produce of their own industry, or by performing the office of carriers between distant countries, and exchanging the produce of one for that of another.27 A city might in this manner grow up to great wealth and splendor, while not only the country in its neighbourhood, but all those to which it traded, were in poverty and wretchedness.28 Each of those countries, perhaps, taken singly, could afford it but a small part, either of its subsistence, or of its employment; but all of them taken together could afford it both a great subsistence and a great employment. There were, however, within the narrow circle of the commerce of those times, some countries that were opulent and industrious. Such was the Greek empire as long as it subsisted, and that of the Saracens during the reigns of the Abassides. Such too was Egypt till it was conquered by the Turks, some part of the coast of Barbary, and all those provinces of Spain which were under the government of the Moors.29

14 The cities of Italy seem to have been the first in Europe which were raised by commerce to any considerable degree of opulence. Italy lay in the center of what was at that time the improved and civilized part of the world.30 The cruzades too, though by the great waste of stock and destruction of inhabitants which they occasioned, they must necessarily have retarded the progress of the greater part of Europe, were extremely favourable to that of some Italian cities. The great armies which marched from all parts to the conquest of the Holy Land, gave extraordinary encouragement to the shipping of Venice, Genoa, and Pisa,31 sometimes in transporting them thither, and always in supplying them with provisions. They were the commissaries, if one may say so, of those armies; and the most destructive frenzy that ever befel the European nations, was a source of opulence to those republicks.32

15The inhabitants of trading cities, by importing the improved manufactures and expensive luxuries of richer countries, afforded some food to the vanity of the great proprietors, who eagerly purchased them with great quantities of the rude produce of their own lands. The commerce of a great part of Europe in those times accordingly, consisted chiefly in the exchange of their own rude, for the manufactured produce of more civilized nations. Thus the wool of England used to be exchanged for the wines of France, and the fine cloths of Flanders, in the same manner as the corn ⁱofⁱ Poland is at this day exchanged for the wines and brandies of France, and for the silks and velvets of France and Italy.

16A taste for the finer and more improved manufactures, was in this manner introduced by foreign commerce into countries where no such works were carried on. But when this taste became so general as to occasion a considerable demand, the merchants, in order to save the expence of carriage, naturally endeavoured to establish some manufactures of the same kind in their own country. Hence the origin of the first manufactures for distant sale that seem to have been established in the western provinces of Europe, after the fall of the Roman empire.

17No large country, it must be observed, ever did or could subsist without some sort of manufactures being carried on in it; and when it is said of any such country that it has no manufactures, it must always be understood of the finer and more improved, or of such as are fit for distant sale. In every large country, both the cloathing and houshold furniture of the far greater part of the people, are the produce of their own industry. This is even more universally the case in those poor countries which are commonly said to have no manufactures, than in those rich ones that are said to abound in them. In the latter, you will generally find, both in the cloaths and houshold furniture of the lowest rank of people, a much greater proportion of foreign productions than in the former.

18 Those manufactures which are fit for distant sale, seem to have been introduced into different countries in two different ways.

19Sometimes they have been introduced, in the manner above mentioned, by the violent operation, if one may say so, of the stocks of particular merchants and undertakers, who established them in imitation of some foreign manufactures of the same kind. Such manufactures, therefore, are the offspring of foreign commerce, and such seem to have been the antient manufactures of silks, velvets, and brocades^j, which flourished in Lucca during^j the thirteenth century. ^kThey were banished from thence by the tyranny of one of Machiavel’s heroes, Castruccio Castracani. In 1310, nine hundred families were driven out of Lucca , of whom thirty–one retired to Venice, and offered to introduce there the silk manufacture* . Their offer was accepted; many privileges were conferred upon them, and they began the manufacture with three hundred workmen.^k Such too seem to have been the manufactures of fine cloths that antiently flourished in Flanders, and which were introduced into England in the beginning of the reign of Elizabeth; and such are the present silk manufactures of Lyons and Spitalfields.33 Manufactures introduced in this manner are generally employed upon foreign materials, being ^m imitations of foreign manufactures. When the Venetian manufacture ⁿwas first established the materials were all brought from Sicily and the Levant. The more antient manufacture of Lucca was likewise carried on with foreign materials. The cultivation of mulberry trees, and the breeding of silk worms, seem not to have been common in the northern parts of Italy before the sixteenth century. Those arts were not introduced into France till the reign of Charles IX.ⁿ The manufactures of Flanders were carried on chiefly with Spanish and English wool. Spanish wool was the material, not of the first woollen manufacture of England, but of the first that was fit for distant sale.34 More than one half the materials of the Lyons manufacture is at this day foreign silk; when it was first established, the whole or very nearly the whole was so. No part of the materials of the Spital–fields manufacture is ever likely to be the produce of England. The seat of such manufactures, as they are generally introduced by the scheme and project of a few individuals, is sometimes established in a maritime city, and sometimes in an inland town, according as their interest, judgment or caprice happen to determine.

20At other times manufactures for distant sale grow up naturally, and as it were of their own accord, by the gradual refinement of those houshold and coarser manufactures which must at all times be carried on even in the poorest and rudest countries.35 Such manufactures are generally employed upon the materials which the country produces, and they seem frequently to have been first refined and improved in such inland countries as were, not indeed at a very great, but at a considerable distance from the sea coast, and sometimes even from all water carriage. An inland country naturally fertile and easily cultivated, produces a great surplus of provisions beyond what is necessary for maintaining the cultivators, and on account of the expence of land carriage, and inconveniency of river navigation, it may frequently be difficult to send this surplus abroad. Abundance, therefore, renders provisions cheap, and encourages a great number of workmen to settle in the neighbourhood, who find that their industry can there procure them more of the necessaries and conveniencies of life than in other places.36 They work up the materials of manufacture which the land produces, and exchange their finished work, or what is the same thing the price of it, for more materials and provisions. They give a new value to the surplus part of the rude produce, by saving the expence of carrying it to the water side, or to some distant market; and they furnish the cultivators with something in exchange for it that is either useful or agreeable to them, upon easier terms than they could have obtained it before. The cultivators get a better price for their surplus produce, and can purchase cheaper other conveniencies which they have occasion for. They are thus both encouraged and enabled to increase this surplus produce by a further improvement and better cultivation of the land; and as the fertility of the land had given birth to the manufacture, so the progress of the manufacture re–acts upon the land, and increases still further its fertility. The manufacturers first supply the neighbourhood, and afterwards, as their work improves and refines, more distant markets. For though neither the rude produce, nor even the coarse manufacture, could, without the greatest difficulty, support the expence of a considerable land carriage, the refined and improved manufacture easily may. In a small bulk it frequently contains the price of a great quantity of rude produce. A piece of fine cloth, for example, which weighs only eighty pounds, contains in it, the price, not only of eighty pounds weight of wool, but sometimes of several thousand weight of corn, the maintenance of the different working people, and of their immediate employers. The corn, which could with difficulty have been carried abroad in its own shape, is in this manner virtually exported in that of the complete manufacture, and may easily be sent to the remotest corners of the world.37 In this manner have grown up naturally, and as it were of their own accord, the manufactures of Leeds, Halifax, Sheffield, Birmingham, and Wolverhampton. Such manufactures are the offspring of agriculture.38 In the modern history of Europe, their extension and improvement have generally been posterior to those which were the offspring of foreign commerce.39 England was noted for the manufacture of fine cloths made of Spanish wool, more than a century before any of those which now flourish in the places above mentioned were fit for foreign sale. The extension and improvement of these last could not take place but in consequence of the extension and improvement of agriculture, the last and greatest effect of foreign commerce, and of the manufactures immediately introduced by it, and which I shall now proceed to explain.

[1 ]Smith considers the origins of cities in ancient Greece in LJ (B) 32–3, ed. Cannan 23.

[2 ]In LJ (A) i.112, Smith comments on the servile condition of those living on the land and adds: ‘It is . . . certain, tho’ not equally known, that the burghers and traders in towns, tho’ they might have some greater liberties, were also in a state of villainage. This is evident from the charters granted them in the earliest times . . .’ Smith then went on to make similar points to those cited in the text, with regard to the rights of marriage, succession, etc.

[3 ]Smith refers to taxes on hawkers and pedlars at V.ii.g.2.

[4 ]Duties of passage are considered below, V.ii.k.56.

[5 ]See below, V.ii.k.20, where Smith comments on the position of merchants at this period.

[6 ]Cf. Hume (History of England (1778), i.205–6): ‘we find, by the extracts which Dr. Brady has given us from Domesday, that almost all the inhabitants even of towns, had placed themselves under the clientship of some particular nobleman, whose patronage they purchased by annual payments, and whom they were obliged to consider as their sovereign, more than the king himself, or even the legislature.’ The Domesday Book is also cited at V.ii.c.21 and LJ (B) 301, ed. Cannan 232–3. In LJ (A) iv.143 it is stated that at the time of William the Conqueror, towns such as York were very small:

The lawless and disorderly state of the country rendered communication dangerous, and besides there was little demand for any of the produce of the mechanick. There were therefore but few of them in the country and very small towns. The tradesman or merchant in a country in that state would be altogether helpless. They were generally slaves of some lord, or if they were poor freemen they became dependents either on the king or on some great lord, according as their lands lay most contiguous and were best able to afford them protection and liberty. By this means they were very little better than villains or slaves of these great men. In LJ (B) 302, ed. Cannan 233, Smith commented on the impediment to economic progress represented by the ‘mean and despicable idea’ which men had of merchants at this time. He added:

when merchants were so despicable and laid under so great taxations for liberty of trade, they could never amass that degree of stock which is necessary for making the division of labour and improving manufactures. The only persons in those days who made any money by trade were the Jews, who, as they were considered as vagabonds, had no liberty of purchasing lands, and had no other way to dispose of themselves but by becoming mechanics or merchants. Their character could not be spoiled by the merchandize, because they could not be more odious than their religion made them. Even they were grievously oppressed and consequently the progress of opulence was greatly retarded. See below, V.iii.1 where Smith comments that at one time to trade was ‘disgraceful to a gentleman’ and the lending of money at interest even more so. Very similar ideas with regard to the mean condition of merchants and the persecution of the Jews are stated by Montesquieu, Esprit, XXI.xx, in a section entitled ‘How Commerce broke through the Barbarism of Europe’.

[a * ]See Brady’s historical treatise of Cities and Burroughs, p. 3, &c.a [For example: ‘. . . the Kings of England kept this Burg [Yarmouth] in their own Hands, and received by their Officers the Profits of the Port, until the time of King John, who in the 9th year of his Reign Granted the Burg in Fee–Farm to the Burgesses for ever, at the Rent of Fifty Five Pounds by the Year to be paid by the Provost or Bayliff of Yarmouth, and Granted they should yearly chuse a Bayliff amongst themselves, fit both to serve him, and themselves.’ After a number of similar instances from Domesday Brady continued, ‘By these instances we find the Burgesses or Tradesmen in great Towns, had in those times their Patrons under whose Protection they Traded, and paid an acknowledgement therefor, or else were in a more Servile Condition, as being in Dominio Regis vel aliorum, altogether under the power of the King, or other Lords, and it seems to me that then they Traded not, as being in any Merchant–Gild, Society and Community, but meerly under the Liberty and Protection given them by their Lords and Patrons, who probably might have Power from the King to Licence such a number in this or that Port, or Trading Town . . .’ (R. Brady, Cities and Boroughs, 3 and 16.)

[b–b]2–6

[cc* ]See Madox Firma Burgi, p. 18, also History of the Exchequer, chap. 10. Sect. v. p. 223, first edition.c [‘The yearly profit which the King made of his Cities Towns or Burghs was commonly raised and paid to Him in a sundry manner . . . sometimes the King was pleased to demise or let his Town to the Townsmen thereof at Ferm, that is to say, either in Fee–ferm, or at Ferm for Years.’ But Madox does not suggest the development came necessarily from the farming of the poll tax. ‘The yearly Ferme of Towns arose out of certain locata or demised things that yielded Issues or profit. Insomuch that when a Town was committed to a Sherif Fermer or Custos, such Fermer or Custos well knew how to raise the Ferme out of the ordinary issues of the Towns, with an overplus of profit to himself.’ (T. Madox, Firma Burgi 18 and 251.) ‘From the reign of K. William I, down to the succeeding times, the King . . . used to let–out the several Counties of England upon a yearly Ferm or Rent concerted between the Crown and the Fermer, or else to commit them to Custody.’ (Madox, The History and Antiquities of the Exchequer (London, 1711), 223.) In Letter 115 addressed to Lord Hailes, dated 15 January 1769 Smith also described Madox’s work as the History of the Exchequer.]

[7 ]‘Then the King if he pleased demised his Towns to the Townsmen or others, in like manner as he demised any of his Manors to the Tenants thereof.’ (T. Madox, Firma Burgi, 21.) Wotton–under–Edge in Gloucestershire is cited as an example.

[8 ]In LJ (A) iv.144 Smith explained the origins of the cities as part of a general drive to reduce the power of the nobles. He went on to remark that the units thus created: ‘were afterwards formed into corporations holding in capite of the king, having a jurisdiction and territory for which they paid a certain rent. At first this was taken up from every individual, but afterwards the community farmed it, which made the burthen much easier than when it was exacted without distinction by the king’s officers.’ See also LJ (A) iv.151–2, and LJ (B) 57, ed. Cannan 40.

[9 ]Brady (Cities and Boroughs, 17) explained the development: ‘How long in most Burghs, very many Burgesses remained in this Servile State, or others in a Middle or Neutral State of between Servitude and Freedom; I cannot say certainly, but do suppose, until our Ancient Norman Kings granted by their Charters, there should be Merchant or Trading–Gilds, Communities and Societies, in Burghs, and gave them Free Liberty of Trade, without paying Toll or Custom anywhere, other than their Fee–Farm–Rent in Lieu of them, where that was Reserved; or to Raise and Multiply such Payments by Incouragement of Trade, which by the Grants of such Liberties did mightily Increase, where the Kings Bayliffs collected them.’

[10 ]See I.x.c.17.

[11 ]In LJ (A) ii.39 Smith found the origins of corporations in the need to ensure that the inhabitants of cities had the means of defending themselves, while pointing out that they also gave a degree of security to individuals working in particular trades, encouraging by this means the division of labour. See above I.ii.1.

[dd* ]See Madox Firma Burgi: See also Pfeffel in the remarkable events under Frederick II. and his successors of the house of Suabia.d [The heading ‘evénements remarquables sous Frédéric II’ is used by Pfeffel for several similar chapters. C. F. Pfeffel von Kriegelstein, Nouvel Abrégé chronologique de l’histoire et du droit publique d’Allemagne (Paris, 1766), i.284–307.]

[12 ]Hume also noted that ‘The government of cities . . ., even under absolute monarchies, is commonly republican.’ (History of England (1778), vi.295.)

[13 ]This point is elaborated in the following chapter, III.iv. especially 8 and 9.

[14 ]That did not prevent medieval lords from trying to set up ‘towns’ on their lands. M. W. Beresford, The New Towns of the Middle Ages: Town Plantations in England, Wales and Gascony (1967).

[15 ]The additional problem which was presented by the power of the Church is considered below, V.i.g.17.

[16 ]The king is identified as John in LJ (A) iii.74. It is also pointed out in LJ (A) iv.154 that the feudal emoluments tended to decline at the very time that the needs of government increased, and that in consequence the reigns most favourable to liberty were ‘those of martiall, conquering, military kings. Edward the 1st and Henry the 4th, the two most warlike of the English kings, granted greater immunities to the people than any others.’ Two reasons are suggested: first, that such kings became dependent on the people for funds, and, secondly, that ‘it soon became a rule with the people that they should grant no subsidies till their requests were first granted’.

[ee* ]See Madox.e [‘King John granted some of his Towns in Normandy, to wit, to Falaise, Danfront, and Caen, that they might have a Communa during his pleasure.’ (T. Madox, Firma Burgi, 35.)]

[17 ]G. Daniel, Histoire de France (Amsterdam 1720) was a work which Smith ordered for Glasgow University Library. His Quaestor’s accounts are printed in Scott, 178–9.

[18 ]C. Du Fresne, Sieur du Cange, Glossarium (1688) s.v. Commune (Paris, 1842 edn., ii.482). Brady, quoting du Fresne, states ‘The Kings of France erected these Communities to cheque the Insolencies of their great Vassals, and to protect them from their over–grown Dominion and Extravagant Power over them, that they reputed such Cities and Towns their own, where there were such Communities; and truley, for that the Inhabitants were in a manner Freed from the Dominion of their Lords thereby, and became immediately Subject to their Kings.’ (Cities and Boroughs, 17.) Hume, citing the same source, held that ‘the erecting of these communities was an invention of Lewis the Gross, in order to free the people from slavery under the lords, and to give them protection, by means of certain privileges and a separate jurisdiction.’ (History of England (1778), ii.118.)

[19 ]See above, III.iii.7.

[ff* ]See Pfeffel.f

[20 ]Smith comments on Italian, Swiss, and German experience in LJ (A) v.46–50 and LJ (B) 77, ed. Cannan 54.

[21 ]See above, III.iii.6.

[g–g]2–6

[h]in those assemblies 1

[22 ]The origins and development of the British House of Commons are considered in LJ (A) iv.134–57, and rather more briefly in LJ(B) 58–9, ed. Cannan 40–1. Smith argues in LJ (B) 60–1, ed. Cannan 42, that the initial result of the rising importance of the Commons was the absolutist state, the point being that ‘the power of the nobility was diminished, and that too before the House of Commons had established its authority’. The same point is made in LJ (A) iv.159–60, with regard to the emergence of absolutism in Scotland and England, while in addition the examples of France, Spain, and Portugal are cited at pp. 162 and 167. In LJ (A) iv.167–8, it is emphasized that ‘In England alone a different government has been established from the naturall course of things’, partly no doubt as a consequence of her pattern of economic development, but also as a result of factors of a more ‘accidental’ kind. For example, Smith cited a number of forces which militated against the preservation of the absolute power of kings, including:

• (1) Ease of defence by sea which minimized the danger of foreign invasion, together with the political solution to the Scottish problem through union—both of which reduced the need for a standing army as a potential instrument of oppression.
• (2) The need of the King to summon Parliament on any extraordinary contingency, allied to the dependence of the Crown on the Commons for supplies—a trend which had been accelerated by the sale of Crown lands by Elizabeth I.
• (3) The gradual growth in the significance of the Commons who were eventually enabled to look upon themselves as in power ‘equall or perhaps greater’ than the nobles.
• (4) The dissipation of the civil list through the ‘extravagant and luxurious turn of Charles’ who chose to employ it in the pursuit of his pleasures so that ‘he became as necessitous and dependent on Parliament as any of the preceding monarchs had been’.
• (5) The fact that once a standing army had been formed, it became a source of security rather than of oppression owing to the fact that ‘Many of the persons of chief rank and station in the army have also large estates of their own and are members of the House of Commons.’ LJ (A) iv.168–79 (and see below, V.i.a.41). Similar points are made in LJ (A) v.1–15 where Bolingbroke’s authority is cited with regard to the conduct of Elizabeth, whose willingness to sell Crown lands was linked with her lack of a direct heir. Smith also adverts to the role of the Courts as a security for English liberties in LJ (B) 63–4, ed. Cannan 45–6. See generally, LJ (B) 60–4, ed. Cannan 42–6, and below, V.i.b.25.

[23 ]This term is used, for example, at II.iii.28, IV.v.b.43, and IV.ix.28.

[24 ]See above, II.i.30 and II.iii.36, where Smith elaborates on the importance of security for industry; and see also III.iv.4 and IV.v.b.43.

[25 ]The fact that slaves could receive their freedom after a residence of one year is mentioned in LJ (A) iv.144 and LJ (B) 57, ed. Cannan 40.

[26 ]Cantillon, Essai, 22–3, ed. Higgs 19, also noted that ‘Great Cities are usually built on the seacoast or on the banks of large Rivers for the convenience of transport; because water–carriage of the produce and merchandise necessary for the subsistence and comfort of the inhabitants is much cheaper than Carriages and Land Transport.’ See also Essai, 202–3, ed. Higgs 153.

[27 ]The importance of water carriage is emphasized in I.iii, and see also II.v.33.

[28 ]See above, I.xi.o.14, where it is pointed out that ‘It was not then the policy of Europe to restrain, by high duties, the importation of foreign manufactures, but rather to encourage it.’

[29 ]In Astronomy, IV.22, Smith refers to the development of science and the translation of classical works on astronomy into Arabic as a result of the ‘munificence of the Abassides, the second race of the Califfs’. He also remarked at § 23 that the ‘victorious arms of the Saracens carried into Spain the learning, as well as the gallantry, of the East; and along with it, . . . the Arabian translations of Ptolemy and Aristotle’.

[30 ]See LJ (A) iv.111: ‘The Italian republicks had in their hands at that time the most profitable branches of trade. They had the whole of the silk manufacture, a very profitable one, and the greatest part of the linnen trade. Their situation also gave them an opportunity of having the whole of the East Indian trade that came into Europe pass thro their hands. The Cape of Good Hope was not then discovered; the goods brought from the East Indies were conveyed up the Red Sea, from thence into the Nile, and by that means to Alexandria, where they were bought up by the Venetian and Genoese merchants chiefly, and by them dispersed thro Europe. Milan, too, tho no sea port, had great commerce. It was the centre of the trade betwixt the other towns, and had besides the greatest share of the silk trade, which all centered in it.’ Cf. LJ (B) 49, ed. Cannan 34, and below, IV.vii.a.5.

[31 ]In LJ (A) iv.68 Smith cites Genoa, Milan, and Venice as examples of democracies in former times, while pointing out that in these cases the power of the state was now in the hands of the nobility. Cf. LJ (A) v.48 and LJ (B) 34, ed. Cannan 24.

[32 ]In LJ (B) 347–8, ed. Cannan 272, the Holy War is also associated with an improvement in military manners. Smith suggested that as the European princes ‘had all been on one side in that common cause, and as they thought that Christians should not be treated in the same manner with infidels, a greater degree of humanity was introduced. From those causes, moderns behave differently from the ancients with regard to the persons of prisoners . . .’ Cf. V.i.g.21.

[i–i]in 4–6

[j–j]that were introduced into Venice in the beginning of 1

[k–k]2–6 [includes the following 3 sentences]

[ll* ]See Sandi Istoria Civile de Vinezia, Part 2. vol. 1. page 247, and 256.l [V. Sandi, Principj di Storia Civile della Republica de Venezia (Venice, 1755), part 2, i.258.]

[33 ]The manufactures of Lyons are mentioned at II.v.15. It is stated at IV.ii.1 that the British manufacturers of completed goods based on silk had been successful in prohibiting the import of foreign commodities.

[m]in 1

[n–n]flourished, there was not a mulberry tree, nor consequencely a silkworm in all Lombardy. They brought the materials from Sicily and from the Levant, the manufacture itself being in imitation of those carried on in the Greek empire. Mulberry trees were first planted in Lombard in the beginning of the sixteenth century, by the encouragement of Ludovico Sforza Duke of Milan. 1

[34 ]See above, II.v.15.

[35 ]See below, V.i.a.6.

[36 ]See above, I.xi.c.3. In discussing the location of industry, Steuart argued that the situation of manufactures which did not depend on the residence of the consumer would tend to be dictated by the conveniency of transportation, the cheapness of subsistence, and: ‘Relative to the place and situation of the establishment, which gives a preference to the sides of rivers and rivulets, when machines wrought by water are necessary; to the proximity of forests and collieries when fire is employed; to the place which produces the substance of the manufacture; as in mines, collieries, brick–works, &c.’ (Principles, i.49, ed. Skinner, i.58.) See especially, I.ix.

[37 ]See below, IV.i.29 and IV.ix.41, where the finer manufactures are stated to be the basis of foreign trade.

[38 ]The manufactures of Birmingham and Sheffield are mentioned at I.x.b.42, where the former are said to be based on fashion, and the latter on necessity.

[39 ]In his essay ‘Of Commerce’ Hume took a rather similar view to Smith’s, emphasizing the role of imitation and emulation of foreign manufactures and stating that ‘If we consult history, we shall find, that, in most nations, foreign trade has preceded any refinement in home manufactures, and given birth to domestic luxury.’ (Essays Moral, Political, and Literary, ed. Green and Grose, i.295.) A similar point is made in the essay ‘Of the Jealousy of Trade’ where it is stated that every improvement made in the last two hundred years in Great Britain had ‘arisen from our imitation of foreigners’ (ibid. i.346).

[a * ]See Brady’s historical treatise of Cities and Burroughs, p. 3, &c.a [For example: ‘. . . the Kings of England kept this Burg [Yarmouth] in their own Hands, and received by their Officers the Profits of the Port, until the time of King John, who in the 9th year of his Reign Granted the Burg in Fee–Farm to the Burgesses for ever, at the Rent of Fifty Five Pounds by the Year to be paid by the Provost or Bayliff of Yarmouth, and Granted they should yearly chuse a Bayliff amongst themselves, fit both to serve him, and themselves.’ After a number of similar instances from Domesday Brady continued, ‘By these instances we find the Burgesses or Tradesmen in great Towns, had in those times their Patrons under whose Protection they Traded, and paid an acknowledgement therefor, or else were in a more Servile Condition, as being in Dominio Regis vel aliorum, altogether under the power of the King, or other Lords, and it seems to me that then they Traded not, as being in any Merchant–Gild, Society and Community, but meerly under the Liberty and Protection given them by their Lords and Patrons, who probably might have Power from the King to Licence such a number in this or that Port, or Trading Town . . .’ (R. Brady, Cities and Boroughs, 3 and 16.)

[cc* ]See Madox Firma Burgi, p. 18, also History of the Exchequer, chap. 10. Sect. v. p. 223, first edition.c [‘The yearly profit which the King made of his Cities Towns or Burghs was commonly raised and paid to Him in a sundry manner . . . sometimes the King was pleased to demise or let his Town to the Townsmen thereof at Ferm, that is to say, either in Fee–ferm, or at Ferm for Years.’ But Madox does not suggest the development came necessarily from the farming of the poll tax. ‘The yearly Ferme of Towns arose out of certain locata or demised things that yielded Issues or profit. Insomuch that when a Town was committed to a Sherif Fermer or Custos, such Fermer or Custos well knew how to raise the Ferme out of the ordinary issues of the Towns, with an overplus of profit to himself.’ (T. Madox, Firma Burgi 18 and 251.) ‘From the reign of K. William I, down to the succeeding times, the King . . . used to let–out the several Counties of England upon a yearly Ferm or Rent concerted between the Crown and the Fermer, or else to commit them to Custody.’ (Madox, The History and Antiquities of the Exchequer (London, 1711), 223.) In Letter 115 addressed to Lord Hailes, dated 15 January 1769 Smith also described Madox’s work as the History of the Exchequer.]

[dd* ]See Madox Firma Burgi: See also Pfeffel in the remarkable events under Frederick II. and his successors of the house of Suabia.d [The heading ‘evénements remarquables sous Frédéric II’ is used by Pfeffel for several similar chapters. C. F. Pfeffel von Kriegelstein, Nouvel Abrégé chronologique de l’histoire et du droit publique d’Allemagne (Paris, 1766), i.284–307.]

[ee* ]See Madox.e [‘King John granted some of his Towns in Normandy, to wit, to Falaise, Danfront, and Caen, that they might have a Communa during his pleasure.’ (T. Madox, Firma Burgi, 35.)]

[ff* ]See Pfeffel.f

[ll* ]See Sandi Istoria Civile de Vinezia, Part 2. vol. 1. page 247, and 256.l [V. Sandi, Principj di Storia Civile della Republica de Venezia (Venice, 1755), part 2, i.258.]

[a]2–6

[c]2–6

[d]2–6

[e]2–6

[f]2–6

[l]2–6