- Physical Causes of National Wealth
Nations exhibit great diversity of civilization (*)
Their condition is dependent on physical and moral causes (*)
The principal physical causes are four (*)
Fertility of Soil -- its diversities (*)
The proximate causes of fertility (*)
It may be increased by human industry (*)
Climate -- its influence on national wealth (*)
Influence of heat on vegetation (*)
The climate affected by elevation (*)
Difference between the east and west coasts of continents (*)
Explanation of this difference (*)
Mines -- their influence on national wealth (*)
Their annual addition to the national income (*)
This does not indicate the whole of their benefit (*)
Waters -- contribute to the national wealth (*)
In the supply of fish (*)
In facilitating transportation (*)
In supplying a motive-power (*)
- Moral Causes of National Wealth
There are principally four moral causes (*)
Without industry the bounty of nature unavailing (*)
It is employed in three ways (*)
These the main constituents of material wealth (*)
II. Skill or knowledge -- above the average degree (*)
By this he has obtained the materials of clothing (*)
Has extracted from the earth metallic ores (*)
Also glass, porcelain, marble, &c (*)
Has enabled himself to traverse the ocean (*)
The achievements of his skill best seen in its results (*)
Great skill sometimes exhibited in particular places (*)
Examples from England, France, and other countries (*)
Knowledge and art always a source of power and wealth (*)
III. Frugality. -- Without some saving, man could make no progress (*)
He could acquire no capital (*)
Example of Holland (*)
Why commercial nations are commonly rich (*)
IV. Government. -- Its agency necessary to national prosperity (*)
Man will not be industrious or frugal under a rapacious government (*)
He must be protected from foreign violence (*)
And from domestic injustice and fraud (*)
Contracts must be strictly enforced (*)
Governments should comply with their own engagements (*)
By a breach of faith they may even lose in a pecuniary view (*)
But a loss of character cannot be compensated (*)
Modes by which governments impede national prosperity (*)
They sometimes err by too much regulation (*)
The forbearance of a Government one of its highest attributes (*)
- Principles of Value
Value, what in Political Economy (*)
Exchanges, indispensable to all (*)
The articles exchanged regarded as equivalents (*)
But no evidence of the valuation by the parties (*)
Exchangeable value -- its two elements (*)
When air, light, water, and heat, have value in exchange (*)
The difficulty of attainment of two kinds (*)
Examples of value from the cost of production (*)
Examples of value from the scarcity of the article (*)
Monopolies, what (*)
The rule as to price in monopolies (*)
All articles liable to fluctuation of price (*)
Supply, what (*)
Demand, what (*)
Addition to the supply lowers price (*)
Addition to the demand raises price (*)
Rise of price sometimes anticipated by sellers (*)
Change of price not proportional to change of supply (*)
Change of supply produces change of demand (*)
Example from gold and silver (*)
Error of Say on this subject (*)
The natural demand, what (*)
Illustration from the price of hats (*)
Values as various as the tastes and wants of man (*)
No unvarying standard of value (*)
Gold and silver the best measures for the same time and place (*)
But their value varies greatly in different ages (*)
Labor has different values in different countries (*)
It falls with the increase of population (*)
Corn varies in value in different countries (*)
It rises in value with the increase of population (*)
Corn and labor combined considered (*)
Approximations sufficient for practical use (*)
- The Progress of Society
In the first, or Hunter State, land had no value in exchange (*)
Characteristics of savage life (*)
Tribes claimed a right to the soil they occupied (*)
The means of subsistence then precarious (*)
Population scarce one to the square mile (*)
The Pastoral State, how it probably originated (*)
Its population compared with that of the Hunter State (*)
The taming of such animals as could be useful (*)
All countries not suited to the Pastoral State (*)
The North American Indians might never have been pastoral (*)
The nations of Western Asia were pastoral (*)
Transition from this state to agriculture (*)
The progress hastened by the art of making iron (*)
The consequent increase of population (*)
- Rent
When land first became private property (*)
Its annual use would then have value, or afford rent (*)
Rent, the value of the product beyond the cost of production (*)
Labor, from its relative scarcity, at first high (*)
Why it falls, compared with raw produce (*)
The rise of raw produce causes the rise of rents (*)
Difference of fertility unimportant in causing rents (*)
It merely graduates the difference of rents (*)
The resort to worse soils the effect of a previous rise of rents (*)
A certain degree of fertility necessary to rent (*)
This limit gradually extending to poorer soils (*)
The rise of raw produce checked by three circumstances (*)
Extending the cultivation to inferior soils (*)
Drawing supplies from a greater distance (*)
Improving soils by a greater outlay of capital (*)
All these are the effects, not the causes, of rent (*)
Improvements in husbandry tend to raise rents (*)
The contrary proposition examined (*)
The consumption of corn not a fixed amount in value (*)
Improvements in transportation tend to raise rents (*)
Rents are lowered by a decline of population (*)
By heavy taxation (*)
Town lots -- the source of their rents (*)
The origin of cities and towns (*)
They increase with the density of population (*)
What is their proportionate population in the United States (*)
What in England (*)
Their peculiar benefits and disadvantages (*)
Their tendency to increase inevitable (*)
The rule which determines the value of town lots (*)
What determines the rent of houses in town (*)
Why the profits of land are below the average profits of capital (*)
Ground-rents (*)
- The Different Species of Rent
Owners of land often prefer renting to cultivating it (*)
Advantage of long over short leases (*)
In the United States lands commonly leased from year to year (*)
Rents sometimes in kind -- different rates (*)
Money rents -- the best mode in rich countries (*)
Metayer rents, what -- occasion in this country (*)
Objections to them. They succeed in some parts of Europe (*)
Cultivation by slaves (*)
Where land is cultivated by the owner, its supplies part of the rent (*)
Mines -- difference between them and land (*)
On what depends the ability of mines to yield rent (*)
Coal-mines -- their national value (*)
Iron-mines -- their value (*)
Mines of gold and silver sometimes yield rent (*)
Salt-mines -- the value of this mineral (*)
When salt-works yield a high rent (*)
Salt may in time be obtained wholly from the ocean (*)
Fisheries sometimes yield a high rent (*)
General law of rent (*)
- On Labor
Man's comforts mainly dependent on his own efforts (*)
Civilized and savage men compared (*)
Examples of man's power over matter (*)
From the mineral world (*)
From the animal world (*)
From the vegetable world (*)
Threefold division of his industry (*)
- Agricultural Industry
At first, agriculture rude, and yielding small returns (*)
Then rented to tenants (*)
Rents at first low (*)
Gradual fall in the price of labor (*)
This fall necessarily implied by the rise of raw produce (*)
To suppose the rise of both, a contradiction (*)
Source of the error (*)
Diversity in the modes of human subsistence (*)
Its influence on the numbers a country can support (*)
Different rates of subsistence in different stages of society (*)
The decline in the third stage not inevitable (*)
Possible effect from the high standard of comfort here (*)
Argument drawn from the Census of the United States (*)
Inquiry into the minimum wages of labor (*)
Cultivation by slaves-difference of views (*)
Some facts opposed to theoretical objections (*)
Emancipation in the British West Indies (*)
Wise course of some slave-owners (*)
Slave-owners fitted for the exercise of authority (*)
Its influence on manners by cherishing self-respect (*)
Opinions of Jefferson on its influence (*)
The African race regarded by the whites as inferior (*)
The Southern States are, therefore, more averse to emancipation, (*)
The slaves, however, well treated and happy (*)
This institution not permanent in the United States (*)
It will disappear here as serfdom did in Europe (*)
The value of a slave will in time exceed the cost of rearing him (*)
This is inconsistent with the continuance of slavery (*)
Estimate of our population in less than eighty years (*)
The density then seventy to a square mile (*)
This is probably greater than is consistent with slavery (*)
Reference to a former hypothesis on this subject (*)
How far affected by subsequent changes (*)
The present high price of slaves does not affect this question (*)
That caused by the high price of cotton (*)
With the future increase of slaves cotton must fall in price (*)
The value of labor varies in different countries (*)
Effects of climate (*)
Of moral causes (*)
Of free government (*)
Of popular education (*)
Raw produce is furnished principally by agriculture (*)
In part also by mining and fisheries (*)
- Manufacturing Industry
This branch most requires manual adroitness (*)
Diversities of labor and skill among individuals (*)
Advantages of co-operation, or a division of labor (*)
Illustration from the manufacture of pins (*)
The advantage the result of three circumstances (*)
The benefits derived from machinery (*)
Illustration from the card-making machine (*)
The cotton-gin -- its immense national benefit (*)
The English improvements in spinning and weaving cotton (*)
The value of labor varies from several circumstances (*)
Difference of skill -- examples (*)
Its greater or less agreeableness (*)
Remuneration to clergymen (*)
Rewards by conferring honors (*)
The dangers attending an occupation (*)
Moral qualities affect the rewards of labor (*)
Remuneration of public functionaries (*)
Of superintendents (*)
The unsteadiness of an employment (*)
The greater or less probability of success (*)
The learned professions (*)
The effect of irregularity and precariousness of reward (*)
The influence of custom (*)
In manufactures, three elements (*)
They enter different manufactures in different proportions (*)
In no long time this country must manufacture for itself (*)
A large part of our manufactures now supplied by commerce (*)
This commerce must be modified by our increase of numbers (*)
In two duplications our population will be 120,000,000 (*)
This will require four times as many manufactures as now (*)
The foreign demand for our exports will not increase as much (*)
It may hardly meet a two-fold increase (*)
A part of the labor now employed in agriculture must then be transferred to manufactures (*)
Several commodities the joint product of agriculture and manufactures (*)
- Commercial Industry
Commerce caused by diversity of products of different countries (*)
By its exchanges both parties are benefited (*)
The cost of carriage causes the difference of value (*)
Advantage of canals, roads, and other facilities of transport (*)
They also enlarge the sphere of the market (*)
The contributions of commerce illustrated (*)
Different classes of mercantile men (*)
In some trades integrity of peculiar importance (*)
Error of the mercantile system as to gold and silver (*)
Error as to the balance of trade (*)
But the correction of this error may lead to an opposite one (*)
Excess of imports may indicate national extravagance (*)
Commerce between the United States and Great Britain (*)
This trade justifies a high impost (*)
Two modes of supplying manufactures (*)
Each has its advocates (*)
The tariff question -- the parties geographically divided (*)
Arguments in favor of protection (*)
Arguments in favor of free trade (*)
In what case protection is clearly expedient (*)
When it is clearly both unjust and injurious (*)
- Mental Industry
The importance of mental labor to the best interests of the State (*)
Public functionaries, their rewards partly in the honor conferred (*)
Lawyers, the chance of political preferment a part of their reward (*)
Their professional remuneration high (*)
Physicians, their rewards -- success of quacks. (*)
Surgeons-dentists (*)
Professors (*)
Civil engineers (*)
Why inventors are often ill rewarded (*)
The remuneration of authors commonly small (*)
Cases of exception (*)
The ministers to our pleasure are well rewarded (*)
The cultivators of the fine arts (*)
The pecuniary reward should be liberal but not very high (*)
That of legislators considered (*)
Their compensation should not be very high nor very low (*)
The change of compensation should be always prospective (*)
Strange instance of popular inconsistency (*)
Examples of diversified forms of useful human labor (*)
They show man to be the artificer of his own condition (*)
- Capital
Capital -- of what it consists (*)
It contributes to production in three ways (*)
It is divided into circulating and fixed (*)
Circulating capital, what (*)
Fixed capital, what (*)
The profits of capital indicated by the interest of money (*)
Profits often comprehend the rewards of labor (*)
Why interest was once deemed immoral (*)
Allowed after men became commercial and industrious (*)
Money as much entitled to interest, as land to rent (*)
It is also a just reward to abstinence and forbearance (*)
It is higher or lower, according to the supply and demand (*)
It is high in newly-settled countries (*)
It tends to fall with the progress of population (*)
It is sometimes high from the exactions of the government (*)
It is high, too, from the indebtedness of a country (*)
It is lower for large loans than small ones (*)
The duration of the loan affects the rate of interest (*)
But a difference between large and small loans (*)
No necessary connection between fall of interest and of labor, 141
Interest may be high where population is dense (*)
Usury laws -- their singular policy (*)
They tend to make interest higher (*)
They lessen the amount of loanable money (*)
They induce the lender to demand more by way of indemnity (*)
They also increase the popular odium against lenders (*)
High interest, when legal, as unpopular as usury (*)
The effect of the repeal of the usury laws considered (*)
It would make the laws more consistent (*)
It would take from the borrower the inducement to act dishonorably (*)
But it would not much increase the loanable capital (*)
Hence the repeal has disappointed expectation (*)
The repealing law has been soon repealed (*)
It might be wise to postpone the operation of the repealing law (*)
The injustice to the moneyed class lessened by banks, &c (*)
The rate of interest sometimes raised by the employment (*)
Inquiry into the lowest point to which interest can fall (*)
The transfer of capital to other countries checks the fall (*)
- Money
This species of capital has functions and laws of its own (*)
Its origin (*)
Cattle, salt, cocoa, &c., have thus become a currency (*)
Gold and silver at length found preferable to all commodities (*)
They were recommended by their beauty, scarcity, and utility (*)
In countries not able to produce these metals, various substitutes were used (*)
The useful functions of money are very great (*)
It saves much time and trouble (*)
It encourages productive industry (*)
It aids governments in collecting and disbursing the revenue (*)
It should not exceed the wants of the community (*)
The quantity wanted depends on the number and value of the exchanges (*)
The value of gold and silver has varied in different ages (*)
Effect of the discovery of America (*)
It varies in different countries according to distance from the richest mines (*)
Its value increased by the expense of two voyages (*)
The quantity wanted in a country increased by its wealth (*)
Paper money lessens the amount wanted (*)
It is also affected by the circumstances of local traffic (*)
The disadvantages of a redundant currency (*)
In the United States it produces excessive imports (*)
The value of specie does not vary in proportion to the quantity (*)
How the excess is counterbalanced (*)
How the deficiency is counterbalanced (*)
To fit gold and silver for currency it is coined by the Government (*)
The principal regulations of the United States Mint (*)
Denominations and value of the coins (*)
The decimal divisions -- popular preference for the binary (*)
Alloy of gold and silver -- two reasons for (*)
Seignorage of the mint, what (*)
Advantages of a seignorage (*)
Standards of value -- different rules in different countries (*)
Disadvantages of a double standard (*)
Gold and silver will circulate, though not a legal tender (*)
The relative value of the two metals liable to change (*)
Effect of the California and Australian mines (*)
Estimate of the consumption of gold (*)
It greatly exceeds the production (*)
A depreciation of gold must be the consequence (*)
That will cause a decreased supply and increased demand (*)
The depreciation will thus finally cease (*)
The proportion between the amount produced and that previously existing (*)
Bank paper the best substitute for specie (*)
- Banks
Two kinds of banks (*)
Banks of deposit, what (*)
The Bank of Amsterdam-its history (*)
Banks of circulation, what (*)
The source of their profits (*)
They are commonly also banks of deposit and discount (*)
The usual length of their loans (*)
The useful functions of banks (*)
But they sometimes cause a depreciated currency (*)
Examples in 1836 and 1857 (*)
The restrictions commonly imposed by themselves or the stock-holders (*)
Business paper and accommodation, what (*)
Why the former should be preferred in their loans (*)
Small notes are injurious to the public (*)
The restrictions advisable in their charters (*)
They should have an adequate capital (*)
It should be paid in gold or silver coin (*)
Their suspension of specie payments should subject them to penalties (*)
Their smallest notes should be prescribed (*)
Frequent statements of their condition should be published (*)
The policy of "free banks," lately created, examined (*)
Some think banks of deposit may afford a better currency (*)
Several objections to the plan (*)
It would increase the consumption of gold and silver (*)
It would be the same for the time as an annihilation of capital (*)
Its promised benefits would not long continue (*)
In seasons of difficulty its idle hoards would be used (*)
The bank of deposit would thus become a bank of circulation (*)
- Consumption
Consumption is the end of production (*)
Illustrated by a loaf of bread, &c (*)
The whole amount produced is consumed with small exception (*)
Consumption divided between individuals and the government (*)
How the power in free governments is distributed (*)
The public revenue chiefly derived from taxation (*)
Taxes ought to conform to four maxims (*)
They are sometimes levied for other purposes than revenue (*)
To prevent nuisances (*)
To encourage manufactures (*)
Land tax -- how it should be regulated (*)
Tax on houses (*)
Tax on imports-its recommendations (*)
Excise on distilled spirits (*)
Objections made to it in Pennsylvania (*)
Stamps - objection that they tax the time as well as the purse (*)
Tax on banks -- a compensation for the privilege granted them (*)
Tax on auctions (*)
Capitation taxes (*)
Direct and indirect taxes compared (*)
Indirect greatly preferable (*)
Tax on estates of deceased persons (*)
- Public Debts
A resource in great national emergencies (*)
Sometimes they arise from public dues to individuals (*)
Hence arose the practice of funding a debt (*)
Sometimes they arise from contracts with foreign nations (*)
The money can be obtained more easily, and is that which can be best spared (*)
In lightening the present burdens, it increases the future (*)
The annual interest may in time suffice to pay the expense of the Government (*)
They seldom fail to increase (*)
The loss incurred not so great as it at first seems (*)
Much spent by armies would have been as unproductively spent (*)
Difference between a debt by individuals and the Government (*)
Relief from public debts sought in different ways (*)
Depreciation of the coin (*)
Repudiation (*)
- The Public Expenditure
For the national defense (*)
Effect of improvements in the art of war (*)
Jails and penitentiaries (*)
Some establishments supported by the State Governments, &c (*)
Religion -- free in the United States (*)
This freedom sanctioned both by justice and policy (*)
Objections to it answered (*)
It probably multiplies sects (*)
Question as to the Mormons (*)
- Education
The great benefits of a good system of juvenile instruction (*)
Three classes of schools - their several purposes (*)
Female instruction considered (*)
Employments suited to women (*)
The periodical press -- its agency in popular instruction (*)
- Public Charities
Who are their proper objects (*)
The system of poor laws considered (*)
The influence of education in lessening the number of poor (*)
- Roads and Canals
The advantages of facility of transport (*)
The best system of supporting canals and railroads (*)
Benefit of railroads (*)