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Often appears with: labor, wages, and the division of work · trade, markets, and merchants · value, price, and exchange · agriculture and the land · money, coin, and credit · crafts, industry, and manufacture · poverty and wealth · public finance and debt · wages, profit, and rent · taxation, tribute, and revenue · famine, scarcity, and plenty · conquest, plunder, and captives
Usually: argument (126) · detachment (78) · skepticism (40) · curiosity (22) · narrative (14) · censure (13) · exhortation (11) · commentary or gloss (9) · indignation (8) · letter or document (5)
“The life which men praise and regard as successful is but one kind. Why should we exaggerate any one kind at the expense of the others?” Henry David Thoreau, Walden, and On The Duty Of Civil Disobedience · insight
“It is a labor to task the faculties of a man,—such problems of profit and loss, of interest, of tare and tret, and gauging of all kinds in it, as demand a universal knowledge.” Henry David Thoreau, Walden, and On The Duty Of Civil Disobedience · observation
“My dear,” says he, “thou has twice saved my life; from henceforward it shall be all employed for you, and I’ll always take your advice.” Daniel Defoe, The Fortunes and Misfortunes of the Famous Moll Flan · insight
“In other words, the worker is, in law and in fact, the slave of the property-holding class, so effectually a slave that he is sold like a piece of goods, rises and falls in value like a commodity.” Friedrich Engels, The Condition of the Working-Class in England in 184 · insight
“But every further word of the assertion is a lie. The bourgeoisie ignores the fact that it takes years for these results of the decrease in price to follow and for new factories to be built.” Friedrich Engels, The Condition of the Working-Class in England in 184 · wit
“Since only six hours' work is necessary to maintain the laborer for twenty-four hours, it does not follow that the laborer cannot work twelve hours out of the twenty-four.” Friedrich Engels, Landmarks of Scientific Socialism: "Anti-Duehring" · insight
“The laborer then costs the owner of money according to our calculation the value product of six hours' labor, but he gives him daily the value product of twelve hours' labor.” Friedrich Engels, Landmarks of Scientific Socialism: "Anti-Duehring" · observation
“Capitalistic superiority is inseparable from landlordism. A portion of the peasantry is transformed in the cities into factory hands and in the final analysis into factory material. Profit appears as another form of rent.” Friedrich Engels, Landmarks of Scientific Socialism: "Anti-Duehring" · observation
“Gold is always the most powerful instrument for the destruction of the communal society.” Friedrich Engels, Landmarks of Scientific Socialism: "Anti-Duehring" · insight
“Still there is one factor which has not really appreciably changed, one factor which is always confronted by the same necessity, the necessity of maintaining its existence. This factor is the working class.” Friedrich Engels, Landmarks of Scientific Socialism: "Anti-Duehring" · observation
“Thus, then, with every improvement of society, with every increase in its capital, the market wages of labour will rise; but the permanence of their rise will depend on the question, whether the natural price of wages has also risen.” David Ricardo, On The Principles of Political Economy, and Taxation · insight
“It is not, therefore, in consequence of the extension of the market that the rate of profits is raised, although such extension may be equally efficacious in increasing the mass of commodities.” David Ricardo, On The Principles of Political Economy, and Taxation · insight
Jacob proposes a new wage arrangement: only speckled/party and black among lambs and kids; he uses peeled rods to influence breeding, becomes exceedingly wealthy with flocks, servants, camels, and asses.
If I have found favour in thy sight (for I suppose that the LORD {|God|} hath blessed me for thy sake) appoint what thy reward shall be, and I will give it thee. But he said unto him, thou knowest what service I have done thee, and in what taking thy cattle have been under me: For it was but little that thou hadst before I came, and now it is increased into a multitude, and the LORD hath blessed thee for my sake. But…
Plutarch describes Cato managing slaves with strict isolation, punishment, and controlled reproduction, investing in agriculture and ponds, and using sea-venture risk-sharing through partners and loans.
Scipio; nor was he admitted into this family less for his own worth than his father's. So that Cato's care in his son's education came to a very fitting result. He purchased a great many slaves out of the captives taken in war, but chiefly bought up the young ones, who were capable to be, as it were, broken and taught like whelps and colts. None of these ever entered another man's house, except sent either by Cato …
Ricardo extends the idea to capital and tools, arguing that relative value reflects total labor embodied not only in immediate production but also in forming the implements and capital used.
its mark; one beaver would naturally be of more value than two deer, and precisely for this reason, that more labour would on the whole be necessary to its destruction. All the implements necessary to kill the beaver and deer might belong to one class of men, and the labour employed in their destruction might be furnished by another class; still, their comparative prices would be in proportion to the actual labour b…
He continues by showing that when wages rise, commodities produced with more circulating capital rise relatively in value versus those using more fixed capital, and he provides numerical comparisons for hunter and fisherman cases.
To replace his circulating capital of 53*l.* with a profit of 4 per cent. 55.12*l.* To replace fixed capital, annually wasted, the present value of an annuity of 18.49*l.* for ten years, when money is at 4 per cent., being 150*l.* 18.49 ----- £73.61 The fisherman would sell his fish …
Ricardo uses examples to argue that if improvements equalize returns across capital employed, rent falls, while changes increasing inequality in returns raise rent.
of an improvement to diminish the quantity of labour before required to produce a commodity; and this diminution cannot take place without a fall of its price or relative value. The improvements which increase the productive powers of the land, are such as the more skilful rotation of crops, or the better choice of manure. These improvements absolutely enable us to obtain the same produce from a smaller quantity of …
He distinguishes improvements in land productivity from efficiency in tools and capital formation, claiming such changes may lower corn rent only when they reduce differences between productive capitals.
115 = 10 } adequate to the wants of the { 115 -- } population, for it would be 345 { 105 30 } quarters, or { --- { 345 the demand being only for 340 quarters.--But there are improvements which may lower the relative value of produce without lowering the corn rent, though they will lower the money rent of land. Such improvements do not increase the productive powers of the land, but they enable us to obtain its produ…
He defines natural versus market price, arguing market prices fluctuate around natural prices as profits change and capital shifts across employments to equalize returns.
ON NATURAL AND MARKET PRICE. In making labour the foundation of the value of commodities, and the comparative quantity of labour which is necessary to their production, the rule which determines the respective quantities of goods which shall be given in exchange for each other, we must not be supposed to deny the accidental and temporary deviations of the actual or market price of commodities from this, their primar…
Ricardo defines capital as the means of production and argues that whether capital grows with or without rising value changes the natural and market wages differently, affecting labourers’ welfare over time.
may produce the same effect; and thus if the increase of capital be gradual and constant, the demand for labour may give a continued stimulus to an increase of people. Capital is that part of the wealth of a country, which is employed in production, and consists of food, clothing, tools, raw material, machinery, &c. necessary to give effect to labour. Capital may increase in quantity at the same time that its value…
He explains that wages rise or fall due to labour supply and demand and the prices of wage-bought commodities, with fertility and settlement conditions affecting population and capital accumulation rates.
life is cheap," and his wants easily satisfied. Many of the conveniences now enjoyed in an English cottage, would have been thought luxuries at an early period of our history. From manufactured commodities always falling, and raw produce always rising, with the progress of society, such a disproportion in their relative value is at length created, that in rich countries a labourer, by the sacrifice of a very small q…
He adds that long before profits hit zero there’s little incentive to accumulate, and the profit rate falls faster than his arithmetic because the value of farmers’ own stock also rises, aiding some trades unequally.
increase which would be the consequence of the increased value of the raw material from which they are made, and which would of course further increase wages, and lower profits. I have already said, that long before this state of prices was become permanent, there would be no motive for accumulation; for no one accumulates but with a view to make his accumulation productive, and it is only when so employed that it o…
Ricardo argues that accumulation requires both more physical output and higher total value because new land is harder to produce, and in large economies landlords gain while profits fall and laborers’ real condition worsens.
6 per cent., 66,000*l.* or a diminution of 4000*l.* will be received by the owners of stock, although the whole amount of stock will be increased from 1,000,000*l.* to 1,100,000*l.* There can, however, be no accumulation of capital, so long as stock yields any profit at all, without its yielding not only an increase of produce, but an increase of value. By employing 100,000*l.* additional capital, no part of the for…
Ricardo argues that if foreign prices change or imports expand, capital reallocates across sectors, so profits of “favoured” trades tend to return to the general level and prices cannot permanently rise.
profits will be brought about by the general rise of profits; and I am of opinion, that the profits of the favoured trade will speedily subside to the general level. For, first, I deny that less capital will necessarily be devoted to the growth of corn, to the manufacture of cloth, hats, shoes, &c., unless the demand for these commodities be diminished; and if so, their price will not rise. In the purchase of foreig…
He explains capital accumulation can come from higher revenue or lower consumption, using an example of increased merchant profits and savings, and compares machinery and cheap imports as routes to saving.
which were before exported, or any others for which they had an inclination. The capital required for their production would be supplied by the capital liberated from the foreign trade. There are two ways in which capital may be accumulated: it may be saved either in consequence of increased revenue, or of diminished consumption. If my profits are raised from 1000*l.* to 1200*l.* while my expenditure continues the s…
He contrasts profit leveling within a country versus across countries, and uses England–Portugal examples of comparative advantage to show exchanges depend on capital mobility and international barriers.
determines that wine shall be made in France and Portugal, that corn shall be grown in America and Poland, and that hardware and other goods shall be manufactured in England. In one and the same country, profits are, generally speaking, always on the same level; or differ only as the employment of capital may be more or less secure and agreeable. It is not so between different countries. If the profits of capital em…
Ricardo notes that if capital could freely emigrate, England’s cloth production would shift to Portugal where wine and cloth could be made more advantageously; but insecurity and attachment restrain such movement.
capital moves from one country to another, to seek a more profitable employment, and the activity with which it invariably passes from one province to another in the same country.[14] It would undoubtedly be advantageous to the capitalists of England, and to the consumers in both countries, that under such circumstances, the wine and the cloth should both be made in Portugal, and therefore that the capital and labou…
He argues a production improvement raises local prices and changes precious-metal distribution: the improving country gains in real output while the other may seem advantaged by lower prices but produces less overall.
cloth, or in Portugal in producing wine, or let there be more facility in England in producing wine, or in Portugal in producing cloth, and the trade must immediately cease. No change whatever takes place in the circumstances of Portugal; but England finds that she can employ her labour more productively in the manufacture of wine, and instantly the trade of barter between the two countries changes. Not only is the …
In his chapter on taxes, Ricardo defines taxes as portions of national land and labor output ultimately paid from revenue or capital, then explains how government spending financed by new taxes can shift the burden onto capital.
ON TAXES. Taxes are a portion of the produce of the land and labour of a country, placed at the disposal of the government; and are always ultimately paid, either from the capital, or from the revenue of the country. We have already shewn how the capital of a country is either fixed or circulating, according as it is of a more or of a less durable nature. It is difficult to define strictly, where the distinction be…
Ricardo addresses objections to corn taxes—unequal effects, delay between corn and wages, discouraged accumulation, and trade disadvantage—then argues policy can offset inequality and that wage adjustments vary by cause.
if wages had been raised from the increased demand for labour compared with the supply, or from an increasing difficulty of obtaining the food and necessaries required by the labourer. In as far as the tax might affect consumers, it would be an equal tax, but in as far as it would affect profits, it would be a partial tax; for it would neither operate on the landlord nor on the stockholder, since they would continue…
Ricardo defends taxes on raw produce by claiming they need not reduce corn quantity or the laborer’s real wages, because any tax-driven shortfall would correct via price changes and capital shifting.
necessarily any excess in the supply of labour, nor any abatement of demand, and therefore there can be no reason why the labourer should sustain a real diminution of wages. A tax on corn does not necessarily diminish the quantity of corn, it only raises its money price; it does not necessarily diminish the demand compared with the supply of labour; why then should it diminish the portion paid to the labourer? Suppo…
He explains that a raw-material tax affects commodities unevenly depending on their raw-input labor composition, which may distort the best allocation of capital, but still won’t place England at lasting competitive disadvantage.
of money; whilst hats, which had risen from 30*s.* to 33*s.*, will again fall from 33*s.* to 30*s.*, at which point the relation between cloth and hats will be restored. To simplify the consideration of this subject, I have been supposing that a rise in the value of raw materials would affect, in an equal proportion, all home commodities; that if the effect on one were to raise it 10 per cent., it would raise all 10…
Ricardo argues that when only some prices are affected by taxation and money’s value is stable, relative commodity prices change, altering profit equality across industries.
tax; in the first case it is only an eleventh of his income, in the second it is a tenth; money in the two cases being of a different value. But although, if money be not taxed, and do not alter in value, all commodities will rise in price, they will not rise in the same proportion; they will not after the tax bear the same relative value to each other which they did before the tax. In a former part of this work, we…
He proposes a principle: in untaxed countries, money value changes affect all commodity prices proportionally, but under taxation, price changes are uneven, reshuffling capital until profit equilibrium returns.
the first commodity was 10,000*l.*, the price of the second should be 4000*l.*; and when the price of the first was 10,200*l.*, the price of the other should be 4200*l.* The consideration of this fact will lead to the understanding of a very important principle, which I believe has never been adverted to. It is this; that in a country where no taxation subsists, the alteration in the value of money arising from scar…
He critiques Jean-Baptiste Say for inconsistency, then explains how taxes can reduce individuals’ consumption, reallocate demand toward government spending, and thereby change capital allocation across industries.
people, than what is received by Government, the rich consumer will only pay his equitable share; if more is paid, Adam Smith should have stated by whom it is received. M. Say does not appear to me to have consistently adhered to the obvious principle, which I have quoted from his able work; for in the next page, speaking of taxation, he says, "When it is pushed too far, it produces this lamentable effect, it depriv…
He continues that political utility and “saving” do not justify sacrificing integrity, and that only saving and retrenching expenditure can increase national capital rather than shifting burdens across classes.
continue to be paid, and that those who have advanced their capitals for the general benefit, should not be required to forego their equitable claims, on the plea of expediency. But independently of this consideration, it is by no means certain, that political utility would gain any thing by the sacrifice of political integrity; it does by no means follow, that the party exonerated from the payment of the interest o…
Ricardo explains how sudden changes like war-to-peace or peace-to-war cause temporary trade distress because capital is relocated more easily between industries than between regions of specialization, affecting exporters and dependent markets.
ON SUDDEN CHANGES IN THE CHANNELS OF TRADE. A great manufacturing country is peculiarly exposed to temporary reverses and contingencies, produced by the removal of capital from one employment to another. The demands for the produce of agriculture are uniform, they are not under the influence of fashion, prejudice, or caprice. To sustain life, food is necessary, and the demand for food must continue in all ages, and …
Ricardo distinguishes trade revulsion distress from a true decline in national capital, arguing that if the cause is war-to-peace, prosperity should resume; he also contrasts fixed capital-heavy rich nations with poorer ones.
long been accustomed. It is often protracted too by the restrictions and prohibitions, to which the absurd jealousies which prevail between the different states of the commercial commonwealth give rise. The distress which proceeds from a revulsion of trade, is often mistaken for that which accompanies a diminution of the national capital, and a retrograde state of society; and it would perhaps be difficult to point …
Ricardo argues that even if some agricultural investments can’t be withdrawn, other capital can be sold or redeployed, and if it truly couldn’t, a fall in corn prices would still change rent, wages, and profits while leaving national production largely unchanged.
more corn by growing it on land for which he paid no rent, than by manufacturing a commodity with which he purchased it, its price could not be under 4*l.* It has, however, been said that capital cannot be withdrawn from the land; that it takes the form of expenses, which cannot be recovered, such as manuring, fencing, draining, &c., which are necessarily inseparable from the land. This is in some degree true; but t…
Ricardo argues that when capital is tied to land, owners still rationally shift or “sink” it; he likens this to machinery depreciation and criticizes bans on importing corn that harm production.
the maintenance of labour, inasmuch as more will be allotted, under the name of profit, to the productive class, a less, under the name of rent, to the unproductive class. This is true, even if the capital cannot be withdrawn from the land, and must be employed there, or not be employed at all: but if great part of the capital could be withdrawn, as it evidently could, it will be only withdrawn, when it will yield m…
Ricardo argues that “carrying trade” profits reflect choice, not necessity, and that capital would be redeployed at home if foreign trade were blocked, constrained only by workers’ upkeep.
in the carrying trade, it is always from choice, and never from necessity: it is because in that trade their profits will be somewhat greater than in the home trade. Adam Smith has justly observed "that the desire of food is limited in every man by the narrow capacity of the human stomach, but the desire of the conveniences and ornaments of building, dress, equipage, and household furniture, seems to have no limit o…
He compares exchequer bills and consols-like government securities, showing how differing risk, discounts, and temporary withdrawals of money make funded prices unreliable as interest-rate indicators.
the prices of commodities in proportion to the increased quantity of money; but there is probably always an interval, during which some effect is produced on the rate of interest. The price of funded property is not a steady criterion by which to judge of the rate of interest. In time of war, the stock market is so loaded by the continual loans of Government, that the price of stock has not time to settle at its fai…
Ricardo examines bounties on production by imagining a tax that funds a corn-production bounty, arguing it mainly shifts prices—corn lower, manufactures higher—without increasing national produce or permanently changing capital allocation.
ON BOUNTIES ON PRODUCTION. It may not be uninstructive to consider the effects of a bounty on the *production* of raw produce and other commodities, with a view to observe the application of the principles which I have been endeavouring to establish, with regard to the profits of stock, the annual produce of the land and labour, and the relative prices of manufactures and raw produce. In the first place, let us supp…
Ricardo continues the critique of colonial trade monopoly, saying it changes the direction of capital and shifts burdens to the domestic population, while profits and wages do not directly explain price changes as Adam Smith suggests.
countries. Their own country must both buy dearer and sell dearer; must both buy less and sell less; must both enjoy less and produce less than she otherwise would do." "Our merchants frequently complain of the high wages of British labour as the cause of their manufactures being undersold in foreign markets; but they are silent about the high profits of stock. They complain of the extravagant gain of other people, …
Ricardo argues against Adam Smith’s claim that foreign trade provides only half the encouragement to productive labour, using an example of Scotland-England exchanging linen and silks with Germany and France.
maintained at home: such as the carrying trade, the distant foreign trade, where profits are in proportion to the capital, and not in proportion to the quantity of labour employed.[44] Although I admit, that from the nature of rent, a given capital employed in agriculture, on any but the land last cultivated, puts in motion a greater quantity of labour than an equal capital employed in manufactures and trade, yet I …
He compares banking to an establishment selling inputs below market price, claiming it reallocates profits unfairly and cannot increase total trade capital, then critiques Scottish bankers’ “cash accounts” as redundant under fixed circulation limits.
rate at which the merchants could have borrowed elsewhere; but I confess that to me this seems rather an objection to their establishment, than an argument in favour of it. What should we say of an establishment which should regularly supply half the clothiers with their wool under the market price? Of what benefit would it be to the community? It would not extend our trade, because the wool would equally have been …
He argues that falling wages raise profits rather than rent, and that agricultural improvements reducing labor needs should not raise rent because they lower raw-produce prices and withdraw capital.
and retain all which they relinquished. It has been my endeavour to shew in this work, that a fall of wages would have no other effect than to raise profits. Another cause of the rise of rent, according to Mr. Malthus, is "such agricultural improvements, or such increase of exertions, as will diminish the number of labourers necessary to produce a given effect." This would not raise the value of the whole produce, a…
Ricardo clarifies his disagreement with Malthus over “real price,” insisting production incentives depend on market price exceeding natural price, and that “real price” can’t mean only labor-and-capital quantities.
may be laid down as a principle uniformly true, that the only encouragement to the increased production of a commodity, is its market value exceeding its natural or necessary value. But this is not the meaning which Mr. Malthus, on other occasions, attaches to the term, real price. In the Essay on Rent, Mr. Malthus says, by "the real growing price of corn, I mean the real *quantity* of labour and capital, *which has…
Ricardo argues that rent falls when corn prices drop, eventually causing capital to leave marginal land and shift to other uses, so lower prices reduce estimated value but can increase real output and wealth.
is due to the old stockholders; for they have been receiving the same money dividends for more than a century, although corn has, perhaps, been doubled or trebled in price.[66] Mr. Malthus says, "It is true, that the last additions to the agricultural produce of an improving country are not attended with a large proportion of rent; and it is precisely this circumstance that may make it answer to a rich country to im…
Engels details the iron industry’s rise—puddling, hot blasts, large-scale furnaces, bridge-building in cast iron, and expanding coal use—along with pottery and scientific agriculture, all driven by industrial demand.
of hot blasts, and iron could thus be produced so cheaply that a multitude of objects which had before been made of stone or wood were now made of iron. In 1788, Thomas Paine, the famous democrat, built in Yorkshire the first iron bridge, which was followed by a great number of others, so that now nearly all bridges, especially for railroad traffic, are built of cast- iron, while in London itself a bridge across the…
Engels describes Ancoats in Manchester as a district dominated by mills and overcrowded working housing, arguing that landlords’ land-leasing customs and poor construction create cottages that rapidly decay after about forty years.
in the great working-men's district east of St. George's Road and Ancoats Street, and is the one most often found in the other working-men's quarters of Manchester and its suburbs. In the last-mentioned broad district included under the name Ancoats, stand the largest mills of Manchester lining the canals, colossal six and seven-storied buildings towering with their slender chimneys far above the low cottages of the…
Engels sets wages’ average and fluctuation: when demand rises wages rise slightly above the minimum, but when demand falls idle workers become unsaleable and die, with workers portrayed as commodities sold and bought.
a part of his extraordinary profit, runs into danger of sacrificing any part of his ordinary average profit, he takes very good care not to pay more than average wages. From this we can determine the average rate of wages. Under average circumstances, when neither workers nor capitalists have reason to compete, especially among themselves, when there are just as many workers at hand as can be employed in producing …
Engels claims that mechanization in cotton spinning and weaving throws workers out of employment, describes productivity increases from inventions like the jenny and mule, and cites James Leach’s tables to show spinners and wages declining.
of industry as well. Hand-work is superseded by machine-work almost universally, nearly all manipulations are conducted by the aid of steam or water, and every year is bringing further improvements. In a well-ordered state of society, such improvements could only be a source of rejoicing; in a war of all against all, individuals seize the benefit for themselves, and so deprive the majority of the means of subsistenc…
This passage restates Ricardo’s claim that there is no uniform set of production conditions across commodities—varying capital durability, proportion, and time—so simple universal value measures are impossible.
there is no uniformity in the conditions under which commodities are produced, the time taken and the proportion and durability of the capital employed being, for example, very different (LXXXIV). LETTERS OF DAVID RICARDO TO THOMAS ROBERT MALTHUS. I. STOCK EXCHANGE, *25th Feb., 1810*. MY DEAR SIR, I have just time, after a very busy day, to tell you that I will endeavour to get Mr. Mushet[28] to meet you at my…
Ricardo accepts that war brought wealth and prosperity, but argues profit rates do not necessarily rise; he suggests profits rose temporarily due to faster capital accumulation offset by improved agriculture and that additional money enters only because other goods become cheaper.
it from the general law of competition, and why it should not certainly and invariably (invariably only as that term is applied to other commodities) seek the most advantageous market. It is probable that the word 'redundancy' has not been happily chosen by me to express the impression made on my mind of the cause of an unfavourable balance of trade; but on looking over the article in the Review[40] I find that you …
On 16 September 1814 from Gatcomb Park, Ricardo argues that the permanent cause of high profits is the state of land cultivation and output relative to production means, shaping effective demand via power and will.
partially on particular trades. The state of production from the land, compared with the means necessary to make it produce, operates on all, and is alone lasting in its effects. We agree too that effectual demand consists of two elements, the *power* and the *will* to purchase; but I think the will is very seldom wanting where the power exists, for the desire of accumulation will occasion demand just as effectually…
Ricardo tells Malthus that he and Malthus disagree on whether profit changes come from capital accumulation or from the cost of necessaries and explains how accumulation affects food access and wages.
return here quite time enough to receive a visit from Mrs. Malthus and you next summer vacation, so I trust you will not project an excursion to any other quarter. I perceive that we are not nearly agreed on the subject which we have been lately discussing. I have been endeavouring to get you to admit that the profits on stock employed in manufactures and commerce are seldom permanently lowered or raised by any othe…
Ricardo argues against Malthus’s rent-and-population conclusions by showing that if corn prices rise only with higher wages, profits cannot fall enough to justify cultivating poor land without corn’s price rising too.
for wages will then be for fifteen millions of produce 7.875.000, and for ten millions 5.250.000. Before, it was only five millions; consequently the proportion of surplus produce has diminished. In making this calculation I have very much favoured your view of the question, because the price of corn would not, I think, rise in proportion to the greater number of men employed but to the greater amount of wages paid;…
Ricardo argues Malthus’s position contradicts incentives for employing more labor on land by noting that even if rents don’t exist, surplus beyond workers’ consumption would induce landlords, stockholders, and investors to expand employment.
production.' I do not see how the admission of this fact can assist your argument, which relates only to the ratio of the surplus produce to the whole capital employed. I cannot conceive by what argument you could shew that it might be possible that the addition of another labourer on the land would not pay his expenses, although not more than a quarter of the population were employed upon the land. Allowing, as I m…
Ricardo says his diminishing-rate-of-profit theory isn’t disproved by higher old-land revenues, because profits depend on what farmers receive, and he argues that in principle more labor could be profitably employed even on rentless land.
MY DEAR SIR, You think that my theory of a diminishing rate of profit in consequence of being obliged to cultivate poorer lands is affected by my admission that there will be a greater quantity of surplus produce and a greater money value from the old land. This would be true if any part of either the additional quantity or additional value belonged to the owner of stock. You, however, expressly say that this additi…
A note states that Ricardo and J.-B. Say corresponded, with Ricardo praising Say’s work but faulting him for not clearly distinguishing value from utility and for overlooking how money’s changing value affects capital measurement.
Metiers that the Glasgow professors had made him sit in the chair of Adam Smith. After an active life of teaching and writing, he died in Paris, 15th November, 1832. Ricardo writes to him from Gatcomb Park on 18th Aug., 1815, thanking him for the copy of the (first edition of the) 'Catechisme de l'Economie Politique,' which he had just sent. Though complimenting him highly on the work, he thinks that Say…
Ricardo disputes Malthus’s wage-profit proposition by arguing wages rise mainly through accumulation and demand for labor, while improved productivity can exist without requiring higher wages or lower profits if capital isn’t merely more productive.
he consumed in his family the whole increased produce, without augmenting his capital, wages would remain stationary, and not be in any way affected by the increased facility of production. I cannot agree with your proposition, namely, [']That the means of employing capital profitably can never co-exist with an abundant capital and produce and a stationary population, on account of the necessary effect of such a sta…
Ricardo tells Malthus he’s working privately on his rent-and-wages theory, concedes a special case where profits fall if population is held back, and plans to meet in London with further correspondence about country visits.
I am not at a loss for amusement within doors, I contrive to take my walks while it is fine, and return to my library with the recommencement of rain.... I hope your additional volume will soon follow your new edition of the old work[138]. I shall be glad to see in a connected form your matured opinions on the progress of rent, profits, and wages, and in what manner they are affected by the increasing difficulty of …
A quotation/insert reports Ricardo’s letter to Say dated 18 Dec 1817, including Say’s claim of retiring from business, huge debts, withdrawing capital into land, and praise for Mill’s forthcoming book on India.
says amongst other things: 'Since your visit to England, I have been by degrees retiring from business; and, as our debt is enormous and the price of stock very high, I have from time to time withdrawn my capital, and have laid out much of it in land.... My life is made up of successes and cares; hence I am providing for the future as much as I can, that I may get rid of anxiety altogether. Our fr…
Ricardo continues his letter to Malthus, disputing Malthus’s silver-and-labour example, arguing about money, capital, profits, and wages, and inviting Mrs. Malthus and him to visit at Christmas.
now have hopes it will be finished. You have been very indolent, and are not half so industrious nor so anxious as I am when I have anything on hand. I have not been able to give a proper degree of attention to the subject of your letter. The supposition you make of half an ounce of silver being picked up on the sea shore by a day's labour is, you will confess, an extravagant one. Under such circumstances silver cou…
Ricardo discusses a key economic term—“neat surplus from the land”—and shows how its ambiguous meanings affect conclusions about capital, landlords, and what share reaches the capitalist, labourer, or both.
Road. If you prefer this coach, we will send for you to the place where the roads diverge. This is of course in case Mrs. Malthus does not accompany you.... It is true the case[236] in my book is stated to be temporary, and in my opinion it can only be temporary because it cannot exist when the population has increased with the demand for people. When we meet we must agree upon the meaning to be attached to 'a neat …
Ricardo rejects “stagnation” as a misdescription, insisting low profits from capital accumulation would stop further saving but still allow production at fair prices without a general glut or forced unemployment lowering wages.
in fact there would be little diminution in the quantity of commodities produced; the distribution only would be different; more would go to the capitalists and less to the labourers. I do not think that stagnation is a proper term to apply to a state of things, in which for a time there is no motive to a further increase of production. When in the course of things profits shall be so low from a great accumulation o…
He lays out expected commodities and national gains from discovering the North-West Passage—wealth, cheaper goods, spices and precious materials, colonization, and expanded shipping—framing it as mutually non-harmful to Christian powers.
WHAT COMMODITIES WOULD ENSUE, THIS PASSAGE ONCE DISCOVERED. 1. It were the only way for our princes to possess the wealth of all the east parts (as they term them) of the world, which is infinite; as appeareth by the experience of Alexander the Great in the time of his conquest of India and the east parts of the world, alleged by Quintus Curtius, which would be a great advancement to our country, wonderful enrichin…
He describes the carboniferous record as marine limestones mixed with coal-forming freshwater/brackish deposits, arguing coal largely grew in-place in low alluvial delta swamps like those of the Mississippi and Ganges.
these calcareous strata over large areas in Europe, Canada, and the United States. The same group has also been traced in North America, towards the borders of the arctic sea.[196] There are also several regions in Scotland, and in the central and northern parts of England, as well as in the United States, where marine carboniferous limestones alternate with strata containing coal, in such a manner as to imply the d…
He generalizes that many parasitic insects and even human-associated species achieve near-universal distribution because humans unintentionally carry them worldwide in a way analogous to animals and plants.
from Sumatra to Madagascar, and by such causes a portion of the Malayan language, with some useful plants, have been transferred to that island, which is principally peopled by negroes. The space traversed in some of these instances was so great, that similar accidents might suffice to transport canoes from various parts of Africa to the shores of South America, or from Spain to the Azores, and thence to North Ameri…
It continues the critique by explaining that manufacturing’s value added reflects exchanges and consumer demand, while the land’s products need labor and transformation to become actual wealth.
advancement of national wealth; or, are they not as idle, as if we busied ourselves in inquiring, whether the right or the left foot is the most useful in walking? It is true, indeed, that in every species of manufacture, the workman adds to the value of the raw material a value exactly equal to that which was expended during the process of manufacture; and what is the conclusion we are to draw this? It is merely, t…
It classifies wealth into immediate consumption and capital, distinguishes fixed from circulating capital, breaks community wealth into three major funds, and describes how fixed and circulating capital renew via lands, mines, and fisheries.
Wealth, accumulated in the possession of an individual, is of two descriptions, according to its destination or employment: 1. That reserved for immediate consumption. 2. That employed as capital, for the production of a revenue--book 2, chap. i. Capital is also of two kinds: 1. Fixed capital, which produces a revenue and still remains in the same hands 2. Circulating capital, which yields no revenue unless …