August 11, 2003

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Title: An Inquiry into the Nature and Causes of the Wealth of Nations

Author: Adam Smith

Release Date: April, 2002  [Etext #3300] [Yes, we are about one year
ahead of schedule] [The actual date this file first posted = 03/17/01]

Edition: 10

Language: English

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AN INQUIRY INTO THE NATURE AND CAUSES OF THE WEALTH OF NATIONS.

by Adam Smith

BOOK     I.

OF THE CAUSES OF IMPROVEMENT IN THE PRODUCTIVE POWERS OF LABOUR, AND OF
THE ORDER ACCORDING TO WHICH ITS PRODUCE IS NATURALLY DISTRlBUTED AMONG
THE DIFFERENT RANKS OF THE PEOPLE.

CHAPTER  I.

OF THE DIVISlON OF LABOUR.

The greatest improvements in the productive powers of labour, and the
greater part of the skill, dexterity, and judgment, with which it is
anywhere directed, or applied, seem to have been the effects of the
division of labour. The effects of the division of labour, in the
general business of society, will be more easily understood, by
considering in what manner it operates in some particular manufactures.
It is commonly supposed to be carried furthest in some very trifling
ones ; not perhaps that it really is carried further in them than in
others of more importance: but in those trifling manufactures which are
destined to supply the small wants of but a small number of people, the
whole number of workmen must necessarily be small ; and those employed
in every different branch of the work can often be collected into the
same workhouse, and placed at once under the view of the spectator.

In those great manufactures, on the contrary. which are destined to
supply the great wants of the great body of the people, every different
branch of the work employs so great a number of workmen, that it is
impossible to collect them all into the same workhouse. We can seldom
see more, at one time, than those employed in one single branch.
Though in such manufactures, therefore, the work may really be divided
into a much greater number of parts, than in those of a more trifling
nature, the division is not near so obvious, and has accordingly been
much less observed.

To take an example, therefore, from a very trifling manufacture, but one
in which the division of labour has been very often taken notice of, the
trade of a pin-maker: a workman not educated to this business (which the
division of labour has rendered a distinct trade, nor acquainted with
the use of the machinery employed in it (to the invention of which the
same division of labour has probably given occasion), could scarce,
perhaps, with his utmost industry, make one pin in a day, and certainly
could not make twenty. But in the way in which this business is now
carried on, not only the whole work is a peculiar trade, but it is
divided into a number of branches, of which the greater part are
likewise peculiar trades. One man draws out the wire; another straights
it; a third cuts it; a fourth points it; a fifth grinds it at the top
for receiving the head; to make the head requires two or three distinct
operations ; to put it on is a peculiar business; to whiten the pins is
another ; it is even a trade by itself to put them into the paper ; and
the important business of making a pin is, in this manner, divided into
about eighteen distinct operations, which, in some manufactories, are
all performed by distinct hands, though in others the same man will
sometimes perform two or three of them. I have seen a small manufactory
of this kind, where ten men only were employed, and where some of them
consequently performed two or three distinct operations. But though they
were very poor, and therefore but indifferently accommodated with the
necessary machinery, they could, when they exerted themselves, make
among them about twelve pounds of pins in a day. There are in a pound
upwards of four thousand pins of a middling size. Those ten persons,
therefore, could make among them upwards of forty-eight thousand pins in
a day. Each person, therefore, making a tenth part of forty-eight
thousand pins, might be considered as making four thousand eight hundred
pins in a day. But if they had all wrought separately and independently,
and without any of them having been educated to this peculiar business,
they certainly could not each of them have made twenty, perhaps not one
pin in a day; that is, certainly, not the two hundred and fortieth,
perhaps not the four thousand eight hundredth, part of what they are at
present capable of performing, in consequence of a proper division and
combination of their different operations.

In every other art and manufacture, the effects of the division of
labour are similar to what they are in this very trifling one, though,
in many of them, the labour can neither be so much subdivided, nor
reduced to so great a simplicity of operation. The division of labour,
however, so far as it can be introduced, occasions, in every art, a
proportionable increase of the productive powers of labour. The
separation of different trades and employments from one another, seems
to have taken place in consequence of this advantage. This separation,
too, is generally carried furthest in those countries which enjoy the
highest degree of industry and improvement; what is the work of one man,
in a rude state of society, being generally that of several in an
improved one. In every improved society, the farmer is generally nothing
but a farmer ; the manufacturer, nothing but a manufacturer. The labour,
too, which is necessary to produce any one complete manufacture, is
almost always divided among a great number of hands. How many different
trades are employed in each branch of the linen and woollen
manufactures, from the growers of the flax and the wool, to the
bleachers and smoothers of the linen, or to the dyers and dressers of
the cloth ! The nature of agriculture, indeed, does not admit of so many
subdivisions of labour, nor of so complete a separation of one business
from another, as manufactures. It is impossible to separate so entirely
the business of the grazier from that of the corn-farmer, as the trade
of the carpenter is commonly separated from that of the smith. The
spinner is almost always a distinct person from the, weaver; but the
ploughman, the harrower, the sower of the seed, and the reaper of the
corn, are often the same. The occasions for those different sorts of
labour returning with the different seasons of the year, it is
impossible that one man should be constantly employed in any one of
them. This impossibility of making so complete and entire a separation
of all the different branches of labour employed in agriculture, is
perhaps the reason why the improvement of the productive powers of
labour, in this art, does not always keep pace with their improvement in
manufactures. The most opulent nations, indeed, generally excel all
their neighbours in agriculture as well as in manufactures ; but they
are commonly more distinguished by their superiority in the latter than
in the former. Their lands are in general better cultivated, and having
more labour and expense bestowed upon them, produce more in proportion
to the extent and natural fertility of the ground. But this superiority
of produce is seldom much more than in proportion to the superiority of
labour and expense. In agriculture, the labour of the rich country is
not always much more productive than that of the poor ; or, at least, it
is never so much more productive, as it commonly is in manufactures. The
corn of the rich country, therefore, will not always, in the same degree
of goodness, come cheaper to market than that of the poor. The corn of
Poland, in the same degree of goodness, is as cheap as that of France,
notwithstanding the superior opulence and improvement of the latter
country. The corn of France is, in the corn-provinces, fully as good,
and in most years nearly about the same price with the corn of England,
though, in opulence and improvement, France is perhaps inferior to
England. The corn-lands of England, however, are better cultivated than
those of France, and the corn-lands of France are said to be much better
cultivated than those of Poland. But though the poor country,
notwithstanding the inferiority of its cultivation, can, in some
measure. rival the rich in the cheapness and goodness of its corn, it
can pretend to no such competition in its manufactures, at least if
those manufactures suit the soil, climate, and situation, of the rich
country. The silks of France are better and cheaper than those of
England, because the silk manufacture, at least under the present high
duties upon the importation of raw silk, does not so well suit the
climate of England as that of France. But the hardware and the coarse
woollens of England are beyond all comparison superior to those of
France, and much cheaper, too, in the same degree of goodness. In Poland
there are said to be scarce any manufactures of any kind, a few of those
coarser household manufactures excepted, without which no country can
well subsist.

This great increase in the quantity of work, which, in consequence of
the division of labour, the same number of people are capable of
performing, is owing to three different circumstances ; first, to the
increase of dexterity in every particular workman ; secondly, to the
saving of the time which is commonly lost in passing from one species of
work to another ; and, lastly, to the invention of a great number of
machines which facilitate and abridge labour, and enable one man to do
the work of many.

First, the improvement of the dexterity of the workmen, necessarily
increases the quantity of the work he can perform; and the division of
labour, by reducing every man's business to some one simple operation,
and by making this operation the sole employment of his life,
necessarily increases very much the dexterity of the workman. A common
smith, who, though accustomed to handle the hammer, has never been used
to make nails, if, upon some particular occasion, he is obliged to
attempt it, will scarce, I am assured, be able to make above two or
three hundred nails in a day, and those, too, very bad ones. A smith who
has been accustomed to make nails, but whose sole or principal business
has not been that of a nailer, can seldom, with his utmost diligence,
make more than eight hundred or a thousand nails in a day. I have seen
several boys, under twenty years of age, who had never exercised any
other trade but that of making nails, and who, when they exerted
themselves, could make, each of them, upwards of two thousand three
hundred nails in a day. The making of a nail, however, is by no means
one of the simplest operations. The same person blows the bellows, stirs
or mends the fire as there is occasion, heats the iron, and forges every
part of the nail: in forging the head, too, he is obliged to change his
tools. The different operations into which the making of a pin, or of a
metal button, is subdivided, are all of them much more simple, and the
dexterity of the person, of whose life it has been the sole business to
perform them, is usually much greater. The rapidity with which some of
the operations of those manufactures are performed, exceeds what the
human hand could, by those who had never seen them, he supposed capable
of acquiring.

Secondly, The advantage which is gained by saving the time commonly lost
in passing from one sort of work to another, is much greater than we
should at first view be apt to imagine it. It is impossible to pass very
quickly from one kind of work to another, that is carried on in a
different place, and with quite different tools. A country weaver, who
cultivates a small farm, must loose a good deal of time in passing from
his loom to the field, and from the field to his loom. When the two
trades can be carried on in the same workhouse, the loss of time is, no
doubt, much less. It is, even in this case, however, very considerable.
A man commonly saunters a little in turning his hand from one sort of
employment to another. When he first begins the new work, he is seldom
very keen and hearty; his mind, as they say, does not go to it, and for
some time he rather trifles than applies to good purpose. The habit of
sauntering, and of indolent careless application, which is naturally, or
rather necessarily, acquired by every country workman who is obliged to
change his work and his tools every half hour, and to apply his hand in
twenty different ways almost every day of his life, renders him almost
always slothful and lazy, and incapable of any vigorous application,
even on the most pressing occasions. Independent, therefore, of his
deficiency in point of dexterity, this cause alone must always reduce
considerably the quantity of work which he is capable of performing.

Thirdly, and lastly, everybody must be sensible how much labour is
facilitated and abridged by the application of proper machinery. It is
unnecessary to give any example. I shall only observe, therefore, that
the invention of all those machines by which labour is to much
facilitated and abridged, seems to have been originally owing to the
division of labour. Men are much more likely to discover easier and
readier methods of attaining any object. when the whole attention of
their minds is directed towards that single object, than when it is
dissipated among a great variety of things. But, in consequence of the
division of labour, the whole of every man's attention comes naturally
to be directed towards some one very simple object. It is naturally to
be expected, therefore, that some one or other of those who are employed
in each particular branch of labour should soon find out easier and
readier methods of performing their own particular work, whenever the
nature of it admits of such improvement. A great part of the machines
made use of in those manufactures in which labour is most subdivided,
were originally the invention of common workmen, who, being each of them
employed in some very simple operation, naturally turned their thoughts
towards finding out easier and readier methods of performing it. Whoever
has been much accustomed to visit such manufactures, must frequently
have been shewn very pretty machines, which were the inventions of such
workmen, in order to facilitate and quicken their own particular part of
the work. In the first fire engines {this was the current designation
for steam engines}, a boy was constantly employed to open and shut
alternately the communication between the boiler and the cylinder,
according as the piston either ascended or descended. One of those boys,
who loved to play with his companions, observed that, by tying a string
from the handle of the valve which opened this communication to another
part of the machine, the valve would open and shut without his
assistance, and leave him at liberty to divert himself with his play-
fellows. One of the greatest improvements that has been made upon this
machine, since it was first invented, was in this manner the discovery
of a boy who wanted to save his own labour.

All the improvements in machinery, however, have by no means been the
inventions of those who had occasion to use the machines. Many
improvements have been made by the ingenuity of the makers of the
machines, when to make them became the business of a peculiar trade; and
some by that of those who are called philosophers, or men of
speculation, whose trade it is not to do any thing, but to observe every
thing, and who, upon that account, are often capable of combining
together the powers of the most distant and dissimilar objects. in the
progress of society, philosophy or speculation becomes, like every other
employment, the principal or sole trade and occupation of a particular
class of citizens. Like every other employment, too, it is subdivided
into a great number of different branches, each of which affords
occupation to a peculiar tribe or class of philosophers ; and this
subdivision of employment in philosophy, as well as in every other
business, improve dexterity, and saves time. Each individual becomes
more expert in his own peculiar branch, more work is done upon the
whole, and the quantity of science is considerably increased by it.

It is the great multiplication of the productions of all the different
arts, in consequence of the division of labour, which occasions, in a
well-governed society, that universal opulence which extends itself to
the lowest ranks of the people. Every workman has a great quantity of
his own work to dispose of beyond what he himself has occasion for; and
every other workman being exactly in the same situation, he is enabled
to exchange a great quantity of his own goods for a great quantity or,
what comes to the same thing, for the price of a great quantity of
theirs. He supplies them abundantly with what they have occasion for,
and they accommodate him as amply with what he has occasion for, and a
general plenty diffuses itself through all the different ranks of the
society.

Observe the accommodation of the most common artificer or daylabourer in
a civilized and thriving country, and you will perceive that the number
of people, of whose industry a part, though but a small part, has been
employed in procuring him this accommodation, exceeds all computation.
The woollen coat, for example, which covers the day-labourer, as coarse
and rough as it may appear, is the produce of the joint labour of a
great multitude of workmen. The shepherd, the sorter of the wool, the
wool-comber or carder, the dyer, the scribbler, the spinner, the weaver,
the fuller, the dresser, with many others, must all join their different
arts in order to complete even this homely production. How many
merchants and carriers, besides, must have been employed in transporting
the materials from some of those workmen to others who often live in a
very distant part of the country ? How much commerce and navigation in
particular, how many ship-builders, sailors, sail-makers, rope-makers,
must have been employed in order to bring together the different drugs
made use of by the dyer, which often come from the remotest corners of
the world ? What a variety of labour, too, is necessary in order to
produce the tools of the meanest of those workmen ! To say nothing of
such complicated machines as the ship of the sailor, the mill of the
fuller, or even the loom of the weaver, let us consider only what a
variety of labour is requisite in order to form that very simple
machine, the shears with which the shepherd clips the wool. The miner,
the builder of the furnace for smelting the ore the feller of the
timber, the burner of the charcoal to be made use of in the smelting-
house, the brickmaker, the bricklayer, the workmen who attend the
furnace, the millwright, the forger, the smith, must all of them join
their different arts in order to produce them. Were we to examine, in
the same manner, all the different parts of his dress and household
furniture, the coarse linen shirt which he wears next his skin, the
shoes which cover his feet, the bed which he lies on, and all the
different parts which compose it, the kitchen-grate at which he prepares
his victuals, the coals which he makes use of for that purpose, dug from
the bowels of the earth, and brought to him, perhaps, by a long sea and
a long land-carriage, all the other utensils of his kitchen, all the
furniture of his table, the knives and forks, the earthen or pewter
plates upon which he serves up and divides his victuals, the different
hands employed in preparing his bread and his beer, the glass window
which lets in the heat and the light, and keeps out the wind and the
rain, with all the knowledge and art requisite for preparing that
beautiful and happy invention, without which these northern parts of the
world could scarce have afforded a very comfortable habitation, together
with the tools of all the different workmen employed in producing those
different conveniencies ; if we examine, I say, all these things, and
consider what a variety of labour is employed about each of them, we
shall be sensible that, without the assistance and co-operation of many
thousands, the very meanest person in a civilized country could not be
provided, even according to, what we very falsely imagine, the easy and
simple manner in which he is commonly accommodated. Compared, indeed,
with the more extravagant luxury of the great, his accommodation must no
doubt appear extremely simple and easy ; and yet it may be true,
perhaps, that the accommodation of an European prince does not always so
much exceed that of an industrious and frugal peasant, as the
accommodation of the latter exceeds that of many an African king, the
absolute masters of the lives and liberties of ten thousand naked
savages.

CHAPTER II.

OF THE PRINCIPLE WHICH GIVES OCCASION TO THE DIVISION OF LABOUR.

This division of labour, from which so many advantages are derived, is
not originally the effect of any human wisdom, which foresees and
intends that general opulence to which it gives occasion. It is the
necessary, though very slow and gradual, consequence of a certain
propensity in human nature, which has in view no such extensive utility
; the propensity to truck, barter, and exchange one thing for another.

Whether this propensity be one of those original principles in human
nature, of which no further account can be given, or whether, as seems
more probable, it be the necessary consequence of the faculties of
reason and speech, it belongs not to our present subject to inquire. It
is common to all men, and to be found in no other race of animals, which
seem to know neither this nor any other species of contracts. Two
greyhounds, in running down the same hare, have sometimes the appearance
of acting in some sort of concert. Each turns her towards his companion,
or endeavours to intercept her when his companion turns her towards
himself. This, however, is not the effect of any contract, but of the
accidental concurrence of their passions in the same object at that
particular time. Nobody ever saw a dog make a fair and deliberate
exchange of one bone for another with another dog. Nobody ever saw one
animal, by its gestures and natural cries signify to another, this is
mine, that yours ; I am willing to give this for that. When an animal
wants to obtain something either of a man, or of another animal, it has
no other means of persuasion, but to gain the favour of those whose
service it requires. A puppy fawns upon its dam, and a spaniel
endeavours, by a thousand attractions, to engage the attention of its
master who is at dinner, when it wants to be fed by him. Man sometimes
uses the same arts with his brethren, and when he has no other means of
engaging them to act according to his inclinations, endeavours by every
servile and fawning attention to obtain their good will. He has not
time, however, to do this upon every occasion. In civilized society he
stands at all times in need of the co-operation and assistance of great
multitudes, while his whole life is scarce sufficient to gain the
friendship of a few persons. In almost every other race of animals, each
individual, when it is grown up to maturity, is entirely independent,
and in its natural state has occasion for the assistance of no other
living creature. But man has almost constant occasion for the help of
his brethren, and it is in vain for him to expect it from their
benevolence only. He will be more likely to prevail if he can interest
their self-love in his favour, and shew them that it is for their own
advantage to do for him what he requires of them. Whoever offers to
another a bargain of any kind, proposes to do this. Give me that which I
want, and you shall have this which you want, is the meaning of every
such offer; and it is in this manner that we obtain from one another the
far greater part of those good offices which we stand in need of. It is
not from the benevolence of the butcher the brewer, or the baker that we
expect our dinner, but from their regard to their own interest. We
address ourselves, not to their humanity, but to their self-love, and
never talk to them of our own necessities, but of their advantages.
Nobody but a beggar chooses to depend chiefly upon the benevolence of
his fellow-citizens. Even a beggar does not depend upon it entirely. The
charity of well-disposed people, indeed, supplies him with the whole
fund of his subsistence.     But though this principle ultimately
provides him with all the necessaries of life which he has occasion for,
it neither does nor can provide him with them as he has occasion for
them. The greater part of his occasional wants are supplied in the same
manner as those of other people, by treaty, by barter, and by purchase.
With the money which one man gives him he purchases food. The old
clothes which another bestows upon him he exchanges for other clothes
which suit him better, or for lodging, or for food, or for money, with
which he can buy either food, clothes, or lodging, as he has occasion.

As it is by treaty, by barter, and by purchase, that we obtain from one
another the greater part of those mutual good offices which we stand in
need of, so it is this same trucking disposition which originally gives
occasion to the division of labour. In a tribe of hunters or shepherds,
a particular person makes bows and arrows, for example, with more
readiness and dexterity than any other. He frequently exchanges them for
cattle or for venison, with his companions; and he finds at last that he
can, in this manner, get more cattle and venison, than if he himself
went to the field to catch them. From a regard to his own interest,
therefore, the making of bows and arrows grows to be his chief business,
and he becomes a sort of armourer. Another excels in making the frames
and covers of their little huts or moveable houses. He is accustomed to
be of use in this way to his neighbours, who reward him in the same
manner with cattle and with venison, till at last he finds it his
interest to dedicate himself entirely to this employment, and to become
a sort of house-carpenter. In the same manner a third becomes a smith or
a brazier; a fourth, a tanner or dresser of hides or skins, the
principal part of the clothing of savages. And thus the certainty of
being able to exchange all that surplus part of the produce of his own
labour, which is over and above his own consumption, for such parts of
the produce of other men's labour as he may have occasion for,
encourages every man to apply himself to a particular occupation, and to
cultivate and bring to perfection whatever talent of genius he may
possess for that particular species of business.

The difference of natural talents in different men, is, in reality, much
less than we are aware of ; and the very different genius which appears
to distinguish men of different professions, when grown up to maturity,
is not upon many occasions so much the cause, as the effect of the
division of labour. The difference between the most dissimilar
characters, between a philosopher and a common street porter, for
example, seems to arise not so much from nature, as from habit, custom,
and education. When they came in to the world, and for the first six or
eight years of their existence, they were, perhaps, very much alike, and
neither their parents nor play-fellows could perceive any remarkable
difference. About that age, or soon after, they come to be employed in
very different occupations. The difference of talents comes then to be
taken notice of, and widens by degrees, till at last the vanity of the
philosopher is willing to acknowledge scarce any resemblance. But
without the disposition to truck, barter, and exchange, every man must
have procured to himself every necessary and conveniency of life which
he wanted. All must have had the same duties to perform, and the same
work to do, and there could have been no such difference of employment
as could alone give occasion to any great difference of talents.

As it is this disposition which forms that difference of talents, so
remarkable among men of different professions, so it is this same
disposition which renders that difference useful. Many tribes of
animals, acknowledged to be all of the same species, derive from nature
a much more remarkable distinction of genius, than what, antecedent to
custom and education, appears to take place among men. By nature a
philosopher is not in genius and disposition half so different from a
street porter, as a mastiff is from a grey-hound, or a grey-hound from a
spaniel, or this last from a shepherd's dog. Those different tribes of
animals, however, though all of the same species are of scarce any use
to one another. The strength of the mastiff is not in the least
supported either by the swiftness of the greyhound, or by the sagacity
of the spaniel, or by the docility of the shepherd's dog. The effects of
those different geniuses and talents, for want of the power or
disposition to barter and exchange, cannot be brought into a common
stock, and do not in the least contribute to the better accommodation
and conveniency of the species. Each animal is still obliged to support
and defend itself, separately and independently, and derives no sort of
advantage from that variety of talents with which nature has
distinguished its fellows. Among men, on the contrary, the most
dissimilar geniuses are of use to one another ; the different produces
of their respective talents, by the general disposition to truck,
barter, and exchange, being brought, as it were, into a common stock,
where every man may purchase whatever part of the produce of other men's
talents he has occasion for,

CHAPTER       III.

THAT THE DIVISION OF LABOUR IS LIMITED BY THE EXTENT OF THE MARKET.

As it is the power of exchanging that gives occasion to the division of
labour, so the extent of this division must always be limited by the
extent of that power, or, in other words, by the extent of the market.
When the market is very small, no person can have any encouragement to
dedicate himself entirely to one employment, for want of the power to
exchange all that surplus part of the produce of his own labour, which
is over and above his own consumption, for such parts of the produce of
other men's labour as he has occasion for.

There are some sorts of industry, even of the lowest kind, which can be
carried on nowhere but in a great town. A porter, for example, can find
employment and subsistence in no other place. A village is by much too
narrow a sphere for him; even an ordinary market-town is scarce large
enough to afford him constant occupation. In the lone houses and very
small villages which are scattered about in so desert a country as the
highlands of Scotland, every farmer must be butcher, baker, and brewer,
for his own family. In such situations we can scarce expect to find even
a smith, a carpenter, or a mason, within less than twenty miles of
another of the same trade. The scattered families that live at eight or
ten miles distance from the nearest of them, must learn to perform
themselves a great number of little pieces of work, for which, in more
populous countries, they would call in the assistance of those workmen.
Country workmen are almost everywhere obliged to apply themselves to all
the different branches of industry that have so much affinity to one
another as to be employed about the same sort of materials. A country
carpenter deals in every sort of work that is made of wood ; a country
smith in every sort of work that is made of iron. The former is not only
a carpenter, but a joiner, a cabinet-maker, and even a carver in wood,
as well as a wheel-wright, a plough-wright, a cart and waggon-maker. The
employments of the latter are still more various. It is impossible there
should be such a trade as even that of a nailer in the remote and inland
parts of the highlands of Scotland. Such a workman at the rate of a
thousand nails a-day, and three hundred working days in the year, will
make three hundred thousand nails in the year. But in such a situation
it would be impossible to dispose of one thousand, that is, of one day's
work in the year. As by means of water-carriage, a more extensive market
is opened to every sort of industry than what land-carriage alone can
afford it, so it is upon the sea-coast, and along the banks of navigable
rivers, that industry of every kind naturally begins to subdivide and
improve itself, and it is frequently not till a long time after that
those improvements extend themselves to the inland parts of the country.
A broad-wheeled waggon, attended by two men, and drawn by eight horses,
in about six weeks time, carries and brings back between London and
Edinburgh near four ton weight of goods. In about the same time a ship
navigated by six or eight men, and sailing between the ports of London
and Leith, frequently carries and brings back two hundred ton weight of
goods. Six or eight men, therefore, by the help of water-carriage, can
carry and bring back, in the same time, the same quantity of goods
between London and Edinburgh as fifty broad-wheeled waggons, attended by
a hundred men, and drawn by four hundred horses. Upon two hundred tons
of goods, therefore, carried by the cheapest land-carriage from London
to Edinburgh, there must be charged the maintenance of a hundred men for
three weeks, and both the maintenance and what is nearly equal to
maintenance the wear and tear of four hundred horses, as well as of
fifty great waggons. Whereas, upon the same quantity of goods carried by
water, there is to be charged only the maintenance of six or eight men,
and the wear and tear of a ship of two hundred tons burthen, together
with the value of the superior risk, or the difference of the insurance
between land and water-carriage. Were there no other communication
between those two places, therefore, but by land-carriage, as no goods
could be transported from the one to the other, except such whose price
was very considerable in proportion to their weight, they could carry on
but a small part of that commerce which at present subsists between
them, and consequently could give but a small part of that encouragement
which they at present mutually afford to each other's industry. There
could be little or no commerce of any kind between the distant parts of
the world. What goods could bear the expense of land-carriage between
London and Calcutta ? Or if there were any so precious as to be able to
support this expense, with what safety could they be transported through
the territories of so many barbarous nations? Those two cities, however,
at present carry on a very considerable commerce with each other, and by
mutually affording a market, give a good deal of encouragement to each
other's industry.

Since such, therefore, are the advantages of water-carriage, it is
natural that the first improvements of art and industry should be made
where this conveniency opens the whole world for a market to the produce
of every sort of labour, and that they should always be much later in
extending themselves into the inland parts of the country. The inland
parts of the country can for a long time have no other market for the
greater part of their goods, but the country which lies round about
them, and separates them from the sea-coast, and the great navigable
rivers. The extent of the market, therefore, must for a long time be in
proportion to the riches and populousness of that country, and
consequently their improvement must always be posterior to the
improvement of that country. In our North American colonies, the
plantations have constantly followed either the sea-coast or the banks
of the navigable rivers, and have scarce anywhere extended themselves to
any considerable distance from both.

The nations that, according to the best authenticated history, appear to
have been first civilized, were those that dwelt round the coast of the
Mediterranean sea. That sea, by far the greatest inlet that is known in
the world, having no tides, nor consequently any waves, except such as
are caused by the wind only, was, by the smoothness of its surface, as
well as by the multitude of its islands, and the proximity of its
neighbouring shores, extremely favourable to the infant navigation of
the world; when, from their ignorance of the compass, men were afraid to
quit the view of the coast, and from the imperfection of the art of
ship-building, to abandon themselves to the boisterous waves of the
ocean. To pass beyond the pillars of Hercules, that is, to sail out of
the straits of Gibraltar, was, in the ancient world, long considered as
a most wonderful and dangerous exploit of navigation. It was late before
even the Phoenicians and Carthaginians, the most skilful navigators and
ship-builders of those old times, attempted it; and they were, for a
long time, the only nations that did attempt it.

Of all the countries on the coast of the Mediterranean sea, Egypt seems
to have been the first in which either agriculture or manufactures were
cultivated and improved to any considerable degree. Upper Egypt extends
itself nowhere above a few miles from the Nile; and in Lower Egypt, that
great river breaks itself into many different canals, which, with the
assistance of a little art, seem to have afforded a communication by
water-carriage, not only between all the great towns, but between all
the considerable villages, and even to many farm-houses in the country,
nearly in the same manner as the Rhine and the Maese do in Holland at
present. The extent and easiness of this inland navigation was probably
one of the principal causes of the early improvement of Egypt.

The improvements in agriculture and manufactures seem likewise to have
been of very great antiquity in the provinces of Bengal, in the East
Indies, and in some of the eastern provinces of China, though the great
extent of this antiquity is not authenticated by any histories of whose
authority we, in this part of the world, are well assured. In Bengal,
the Ganges, and several other great rivers, form a great number of
navigable canals, in the same manner as the Nile does in Egypt. In the
eastern provinces of China, too, several great rivers form, by their
different branches, a multitude of canals, and, by communicating with
one another, afford an inland navigation much more extensive than that
either of the Nile or the Ganges, or, perhaps, than both of them put
together. It is remarkable, that neither the ancient Egyptians, nor the
Indians, nor the Chinese, encouraged foreign commerce, but seem all to
have derived their great opulence from this inland navigation.

All the inland parts of Africa, and all that part of Asia which lies any
considerable way north of the Euxine and Caspian seas, the ancient
Scythia, the modern Tartary and Siberia, seem, in all ages of the world,
to have been in the same barbarous and uncivilized state in which we
find them at present. The sea of Tartary is the frozen ocean, which
admits of no navigation ; and though some of the greatest rivers in the
world run through that country, they are at too great a distance from
one another to carry commerce and communication through the greater part
of it. There are in Africa none of those great inlets, such as the
Baltic and Adriatic seas in Europe, the Mediterranean and Euxine seas in
both Europe and Asia, and the gulfs of Arabia, Persia, India, Bengal,
and Siam, in Asia, to carry maritime commerce into the interior parts of
that great continent; and the great rivers of Africa are at too great a
distance from one another to give occasion to any considerable inland
navigation. The commerce, besides, which any nation can carry on by
means of a river which does not break itself into any great number of
branches or canals, and which runs into another territory before it
reaches the sea, can never be very considerable, because it is always in
the power of the nations who possess that other territory to obstruct
the communication between the upper country and the sea. The navigation
of the Danube is of very little use to the different states of Bavaria,
Austria. and Hungary, in comparison of what it would be, if any of them
possessed the whole of its course, till it falls into the Black sea.

  ...

CHAPTER   IX.

OF THE PROFITS OF STOCK.

The rise and fall in the profits of stock depend upon the same causes
with the rise and fall in the wages of labour, the increasing or
declining state of the wealth of the society ; but those causes affect
the one and the other very differently.

The increase of stock, which raises wages, tends to lower profit. When
the stocks of many rich merchants are turned into the same trade, their
mutual competition naturally tends to lower its profit; and when there
is a like increase of stock in all the different trades carried on in
the same society, the same competition must produce the same effect in
them all.

It is not easy, it has already been observed, to ascertain what are the
average wages of labour, even in a particular place, and at a particular
time. We can, even in this case, seldom determine more than what are the
most usual wages. But even this can seldom be done with regard to the
profits of stock. Profit is so very fluctuating, that the person who
carries on a particular trade, cannot always tell you himself what is
the average of his annual profit. It is affected, not only by every
variation of price in the commodities which he deals in, but by the good
or bad fortune both of his rivals and of his customers, and by a
thousand other accidents, to which goods, when carried either by sea or
by land, or even when stored in a warehouse, are liable. It varies,
therefore, not only from year to year, but from day to day, and almost
from hour to hour. To ascertain what is the average profit of all the
different trades carried on in a great kingdom, must be much more
difficult; and to judge of what it may have been formerly, or in remote
periods of time, with any degree of precision, must be altogether
impossible.

But though it may be impossible to determine, with any degree of
precision, what are or were the average profits of stock, either in the
present or in ancient times, some notion may be formed of them from the
interest of money. It may be laid down as a maxim, that wherever a great
deal can be made by the use of money, a great deal will commonly be
given for the use of it; and that, wherever little can be made by it,
less will commonly he given for it. Accordingly, therefore, as the usual
market rate of interest varies in any country, we may be assured that
the ordinary profits of stock must vary with it, must sink as it sinks,
and rise as it rises. The progress of interest, therefore, may lead us
to form some notion of the progress of profit.

By the 37th of Henry VIII. all interest above ten per cent. was declared
unlawful. More, it seems, had sometimes been taken before that. In the
reign of Edward VI. religious zeal prohibited all interest. This
prohibition, however, like all others of the same kind, is said to have
produced no effect, and probably rather increased than diminished the
evil of usury. The statute of Henry VIII. was revived by the 13th of
Elizabeth, cap. 8. and ten per cent. continued to be the legal rate of
interest till the 21st of James I. when it was restricted to eight per
cent. It was reduced to six per cent. soon after the Restoration, and by
the 12th of Queen Anne, to five per cent. All these different statutory
regulations seem to have been made with great propriety. They seem to
have followed, and not to have gone before, the market rate of interest,
or the rate at which people of good credit usually borrowed. Since the
time of Queen Anne, five per cent. seems to have been rather above than
below the market rate. Before the late war, the government borrowed at
three per cent. ; and people of good credit in the capital, and in many
other parts of the kingdom, at three and a-half, four, and four and a-
half per cent.

Since the time of Henry VIII. the wealth and revenue of the country have
been continually advancing, and in the course of their progress, their
pace seems rather to have been gradually accelerated than retarded. They
seem not only to have been going on, but to have been going on faster
and faster. The wages of labour have been continually increasing during
the same period, and, in the greater part of the different branches of
trade and manufactures, the profits of stock have been diminishing.

It generally requires a greater stock to carry on any sort of trade in a
great town than in a country village. The great stocks employed in every
branch of trade, and the number of rich competitors, generally reduce
the rate of profit in the former below what it is in the latter. But the
wages of labour are generally higher in a great town than in a country
village. In a thriving town, the people who have great stocks to employ,
frequently cannot get the number of workmen they want, and therefore bid
against one another, in order to get as many as they can, which raises
the wages of labour, and lowers the profits of stock. In the remote
parts of the country, there is frequently not stock sufficient to employ
all the people, who therefore bid against one another, in order to get
employment, which lowers the wages of labour, and raises the profits of
stock.

In Scotland, though the legal rate of interest is the same as in
England, the market rate is rather higher. People of the best credit
there seldom borrow under five per cent. Even private bankers in
Edinburgh give four per cent. upon their promissory-notes, of which
payment, either in whole or in part may be demanded at pleasure. Private
bankers in London give no interest for the money which is deposited with
them. There are few trades which cannot be carried on with a smaller
stock in Scotland than in England. The common rate of profit, therefore,
must be somewhat greater. The wages of labour, it has already been
observed, are lower in Scotland than in England. The country, too, is
not only much poorer, but the steps by which it advances to a better
condition, for it is evidently advancing, seem to be much slower and
more tardy. The legal rate of interest in France has not during the
course of the present century, been always regulated by the market rate
{ See Denisart, Article Taux des Interests, tom. iii, p.13}. In 1720,
interest was reduced from the twentieth to the fiftieth penny, or from
five to two per cent. In 1724, it was raised to the thirtieth penny, or
to three and a third per cent. In 1725, it was again raised to the
twentieth penny, or to five per cent. In 1766, during the administration
of Mr Laverdy, it was reduced to the twenty-fifth penny, or to four per
cent. The Abbé Terray raised it afterwards to the old rate of five per
cent. The supposed purpose of many of those violent reductions of
interest was to prepare the way for reducing that of the public debts ;
a purpose which has sometimes been executed. France is, perhaps, in the
present times, not so rich a country as England; and though the legal
rate of interest has in France frequently been lower than in England,
the market rate has generally been higher; for there, as in other
countries, they have several very safe and easy methods of evading the
law. The profits of trade, I have been assured by British merchants who
had traded in both countries, are higher in France than in England ; and
it is no doubt upon this account, that many British subjects chuse
rather to employ their capitals in a country where trade is in disgrace,
than in one where it is highly respected. The wages of labour are lower
in France than in England. When you go from Scotland to England, the
difference which you may remark between the dress and countenance of the
common people in the one country and in the other, sufficiently
indicates the difference in their condition. The contrast is still
greater when you return from France. France, though no doubt a richer
country than Scotland, seems not to be going forward so fast. It is a
common and even a popular opinion in the country, that it is going
backwards ; an opinion which I apprehend, is ill-founded, even with
regard to France, but which nobody can possibly entertain with regard to
Scotland, who sees the country now, and who saw it twenty or thirty
years ago.

The province of Holland, on the other hand, in proportion to the extent
of its territory and the number of its people, is a richer country than
England. The government there borrow at two per cent. and private people
of good credit at three. The wages of labour are said to be higher in
Holland than in England, and the Dutch, it is well known, trade upon
lower profits than any people in Europe. The trade of Holland, it has
been pretended by some people, is decaying, and it may perhaps be true
that some particular branches of it are so; but these symptoms seem to
indicate sufficiently that there is no general decay. When profit
diminishes, merchants are very apt to complain that trade decays, though
the diminution of profit is the natural effect of its prosperity, or of
a greater stock being employed in it than before. During the late war,
the Dutch gained the whole carrying trade of France, of which they still
retain a very large share. The great property which they possess both in
French and English funds, about forty millions, it is said in the latter
(in which, I suspect, however, there is a considerable exaggeration ),
the great sums which they lend to private people, in countries where the
rate of interest is higher than in their own, are circumstances which no
doubt demonstrate the redundancy of their stock, or that it has
increased beyond what they can employ with tolerable profit in the
proper business of their own country; but they do not demonstrate that
that business has decreased. As the capital of a private man, though
acquired by a particular trade, may increase beyond what he can employ
in it, and yet that trade continue to increase too, so may likewise the
capital of a great nation.

In our North American and West Indian colonies, not only the wages of
labour, but the interest of money, and consequently the profits of
stock, are higher than in England. In the different colonies, both the
legal and the market rate of interest run from six to eight percent.
High wages of labour and high profits of stock, however, are things,
perhaps, which scarce ever go together, except in the peculiar
circumstances of new colonies. A new colony must always, for some time,
be more understocked in proportion to the extent of its territory, and
more underpeopled in proportion to the extent of its stock, than the
greater part of other countries. They have more land than they have
stock to cultivate. What they have, therefore, is applied to the
cultivation only of what is most fertile and most favourably situated,
the land near the sea-shore, and along the banks of navigable rivers.
Such land, too, is frequently purchased at a price below the value even
of its natural produce. Stock employed in the purchase and improvement
of such lands, must yield a very large profit, and, consequently, afford
to pay a very large interest. Its rapid accumulation in so profitable an
employment enables the planter to increase the number of his hands
faster than he can find them in a new settlement. Those whom he can
find, therefore, are very liberally rewarded. As the colony increases,
the profits of stock gradually diminish. When the most fertile and best
situated lands have been all occupied, less profit can be made by the
cultivation of what is inferior both in soil and situation, and less
interest can be afforded for the stock which is so employed. In the
greater part of our colonies, accordingly, both the legal and the market
rate of interest have been considerably reduced during the course of the
present century. As riches, improvement, and population, have increased,
interest has declined. The wages of labour do not sink with the profits
of stock. The demand for labour increases with the increase of stock,
whatever be its profits; and after these are diminished, stock may not
only continue to increase, but to increase much faster than before. It
is with industrious nations, who are advancing in the acquisition of
riches, as with industrious individuals. A great stock, though with
small profits, generally increases faster than a small stock with great
profits. Money, says the proverb, makes money. When you have got a
little, it is often easy to get more. The great difficulty is to get
that little. The connection between the increase of stock and that of
industry, or of the demand for useful labour, has partly been explained
already, but will be explained more fully hereafter, in treating of the
accumulation of stock.

The acquisition of new territory, or of new branches of trade, may
sometimes raise the profits of stock, and with them the interest of
money, even in a country which is fast advancing in the acquisition of
riches. The stock of the country, not being sufficient for the whole
accession of business which such acquisitions present to the different
people among whom it is divided, is applied to those particular branches
only which afford the greatest profit. Part of what had before been
employed in other trades, is necessarily withdrawn from them, and turned
into some of the new and more profitable ones. In all those old trades,
therefore, the competition comes to be Jess than before. The market
comes to be less fully supplied with many different sorts of goods.
Their price necessarily rises more or less, and yields a greater profit
to those who deal in them, who can, therefore, afford to borrow at a
higher interest. For some time after the conclusion of the late war, not
only private people of the best credit, but some of the greatest
companies in London, commonly borrowed at five per cent. who, before
that, had not been used to pay more than four, and four and a half per
cent. The great accession both of territory and trade by our
acquisitions in North America and the West Indies, will sufficiently
account for this, without supposing any diminution in the capital stock
of the society. So great an accession of new business to be carried on
by the old stock, must necessarily have diminished the quantity employed
in a great number of particular branches, in which the competition being
less, the profits must have been greater. I shall hereafter have
occasion to mention the reasons which dispose me to believe that the
capital stock of Great Britain was not diminished, even by the enormous
expense of the late war.

The diminution of the capital stock of the society, or of the funds
destined for the maintenance of industry, however, as it lowers the
wages of labour, so it raises the profits of stock, and consequently the
interest of money. By the wages of labour being lowered, the owners of
what stock remains in the society can bring their goods at less expense
to market than before ; and less stock being employed in supplying the
market than before, they can sell them dearer. Their goods cost them
less, and they get more for them. Their profits, therefore, being
augmented at both ends, can well afford a large interest. The great
fortunes so suddenly and so easily acquired in Bengal and the other
British settlements in the East Indies, may satisfy us, that as the
wages of labour are very low, so the profits of stock are very high in
those ruined countries. The interest of money is proportionably so. In
Bengal, money is frequently lent to the farmers at forty, fifty, and
sixty per cent. and the succeeding crop is mortgaged for the payment. As
the profits which can afford such an interest must eat up almost the
whole rent of the landlord, so such enormous usury must in its turn eat
up the greater part of those profits. Before the fall of the Roman
republic, a usury of the same kind seems to have been common in the
provinces, under the ruinous administration of their proconsuls. The
virtuous Brutus lent money in Cyprus at eight-and-forty per cent. as we
learn from the letters of Cicero.

In a country which had acquired that full complement of riches which the
nature of its soil and climate, and its situation with respect to other
countries, allowed it to acquire, which could, therefore, advance no
further, and which was not going backwards, both the wages of labour and
the profits of stock would probably be very low. In a country fully
peopled in proportion to what either its territory could maintain, or
its stock employ, the competition for employment would necessarily be so
great as to reduce the wages of labour to what was barely sufficient to
keep up the number of labourers, and the country being already fully
peopled, that number could never be augmented. In a country fully
stocked in proportion to all the business it had to transact, as great a
quantity of stock would be employed in every particular branch as the
nature and extent of the trade would admit. The competition, therefore,
would everywhere be as great, and, consequently, the ordinary profit as
low as possible.

But, perhaps, no country has ever yet arrived at this degree of
opulence. China seems to have been long stationary, and had, probably,
long ago acquired that full complement of riches which is consistent
with the nature of its laws and institutions. But this complement may be
much inferior to what, with other laws and institutions, the nature of
its soil, climate, and situation, might admit of. A country which
neglects or despises foreign commerce, and which admits the vessel of
foreign nations into one or two of its ports only, cannot transact the
same quantity of business which it might do with different laws and
institutions. In a country, too, where, though the rich, or the owners
of large capitals, enjoy a good deal of security, the poor, or the
owners of small capitals, enjoy scarce any, but are liable, under the
pretence of justice, to be pillaged and plundered at any time by the
inferior mandarins, the quantity of stock employed in all the different
branches of business transacted within it, can never be equal to what
the nature and extent of that business might admit. In every different
branch, the oppression of the poor must establish the monopoly of the
rich, who, by engrossing the whole trade to themselves, will be able to
make very large profits. Twelve per cent. accordingly, is said to be the
common interest of money in China, and the ordinary profits of stock
must be sufficient to afford this large interest.

A defect in the law may sometimes raise the rate of interest
considerably above what the condition of the country, as to wealth or
poverty, would require. When the law does not enforce the performance of
contracts, it puts all borrowers nearly upon the same footing with
bankrupts, or people of doubtful credit, in better regulated countries.
The uncertainty of recovering his money makes the lender exact the same
usurious interest which is usually required from bankrupts. Among the
barbarous nations who overran the western provinces of the Roman empire,
the performance of contracts was left for many ages to the faith of the
contracting parties. The courts of justice of their kings seldom
intermeddled in it. The high rate of interest which took place in those
ancient times, may, perhaps, be partly accounted for from this cause.

When the law prohibits interest altogether, it does not prevent it. Many
people must borrow, and nobody will lend without such a consideration
for the use of their money as is suitable, not only to what can be made
by the use of it, but to the difficulty and danger of evading the law.
The high rate of interest among all Mahometan nations is accounted for
by M. Montesquieu, not from their poverty, but partly from this, and
partly from the difficulty of recovering the money.

The lowest ordinary rate of profit must always be something more than
what is sufficient to compensate the occasional losses to which every
employment of stock is exposed. It is this surplus only which is neat or
clear profit. What is called gross profit, comprehends frequently not
only this surplus, but what is retained for compensating such
extraordinary losses. The interest which the borrower can afford to pay
is in proportion to the clear profit only. The lowest ordinary rate of
interest must, in the same manner, be something more than sufficient to
compensate the occasional losses to which lending, even with tolerable
prudence, is exposed. Were it not, mere charity or friendship could be
the only motives for lending.

In a country which had acquired its full complement of riches, where, in
every particular branch of business, there was the greatest quantity of
stock that could be employed in it, as the ordinary rate of clear profit
would be very small, so the usual market rate of interest which could be
afforded out of it would be so low as to render it impossible for any
but the very wealthiest people to live upon the interest of their money.
All people of small or middling fortunes would be obliged to superintend
themselves the employment of their own stocks. It would be necessary
that almost every man should be a man of business, or engage in some
sort of trade. The province of Holland seems to be approaching near to
this state. It is there unfashionable not to be a man of business.
Necessity makes it usual for almost every man to be so, and custom
everywhere regulates fashion. As it is ridiculous not to dress, so is
it, in some measure, not to be employed like other people. As a man of a
civil profession seems awkward in a camp or a garrison, and is even in
some danger of being despised there, so does an idle man among men of
business.

The highest ordinary rate of profit may be such as, in the price of the
greater part of commodities, eats up the whole of what should go to the
rent of the land, and leaves only what is sufficient to pay the labour
of preparing and bringing them to market, according to the lowest rate
at which labour can anywhere be paid, the bare subsistence of the
labourer. The workman must always have been fed in some way or other
while he was about the work, but the landlord may not always have been
paid. The profits of the trade which the servants of the East India
Company carry on in Bengal may not, perhaps, be very far from this rate.

The proportion which the usual market rate of interest ought to bear to
the ordinary rate of clear profit, necessarily varies as profit rises or
falls. Double interest is in Great Britain reckoned what the merchants
call a good, moderate, reasonable profit; terms which, I apprehend, mean
no more than a common and usual profit. In a country where the ordinary
rate of clear profit is eight or ten per cent. it may be reasonable that
one half of it should go to interest, wherever business is carried on
with borrowed money. The stock is at the risk of the borrower, who, as
it were, insures it to the lender ; and four or five per cent. may, in
the greater part of trades, be both a sufficient profit upon the risk of
this insurance, and a sufficient recompence for the trouble of employing
the stock. But the proportion between interest and clear profit might
not be the same in countries where the ordinary rate of profit was
either a good deal lower, or a good deal higher. If it were a good deal
lower, one half of it, perhaps, could not be afforded for interest ; and
more might be afforded if it were a good deal higher.

In countries which are fast advancing to riches, the low rate of profit
may, in the price of many commodities, compensate the high wages of
labour, and enable those countries to sell as cheap as their less
thriving neighbours, among whom the wages of labour may be lower.

In reality, high profits tend much more to raise the price of work than
high wages. If, in the linen manufacture, for example, the wages of the
different working people, the flax-dressers, the spinners, the weavers,
etc. should all of them be advanced twopence a-day, it would be
necessary to heighten the price of a piece of linen only by a number of
twopences equal to the number of people that had been employed about it,
multiplied by the number of days during which they had been so employed.
That part of the price of the commodity which resolved itself into the
wages, would, through all the different stages of the manufacture, rise
only in arithmetical proportion to this rise of wages. But if the
profits of all the different employers of those working people should be
raised five per cent. that part of the price of the commodity which
resolved itself into profit would, through all the different stages of
the manufacture, rise in geometrical proportion to this rise of profit.
The employer of the flax dressers would, in selling his flax, require an
additional five per cent. upon the whole value of the materials and
wages which he advanced to his workmen. The employer of the spinners
would require an additional five per cent. both upon the advanced price
of the flax, and upon the wages of the spinners. And the employer of the
weavers would require alike five per cent. both upon the advanced price
of the linen-yarn, and upon the wages of the weavers. In raising the
price of commodities, the rise of wages operates in the same manner as
simple interest does in the accumulation of debt. The rise of profit
operates like compound interest. Our merchants and master manufacturers
complain much of the bad effects of high wages in raising the price, and
thereby lessening the sale of their goods, both at home and abroad. They
say nothing concerning the bad effects of high profits ; they are silent
with regard to the pernicious effects of their own gains; they complain
only of those of other people.

CHAPTER  X.

OF WAGES AND PROFIT IN THE DIFFERENT EMPLOYMENTS OF LABOUR AND STOCK.

The whole of the advantages and disadvantages of the different
employments of labour and stock, must, in the same neighbourhood, be
either perfectly equal, or continually tending to equality. If, in the
same neighbourhood, there was any employment evidently either more or
less advantageous than the rest, so many people would crowd into it in
the one case, and so many would desert it in the other, that its
advantages would soon return to the level of other employments. This, at
least, would be the case in a society where things were left to follow
their natural course, where there was perfect liberty, and where every
man was perfectly free both to choose what occupation he thought proper,
and to change it as often as he thought proper. Every man's interest
would prompt him to seek the advantageous, and to shun the
disadvantageous employment.

Pecuniary wages and profit, indeed, are everywhere in Europe extremely
different, according to the different employments of labour and stock.
But this difference arises, partly from certain circumstances in the
employments themselves, which, either really, or at least in the
imagination of men, make up for a small pecuniary gain in some, and
counterbalance a great one in others, and partly from the policy of
Europe, which nowhere leaves things at perfect liberty.

The particular consideration of those circumstances, and of that policy,
will divide this Chapter into two parts.

PART I. Inequalities arising from the nature of the employments
themselves.

The five following are the principal circumstances which, so far as I
have been able to observe, make up for a small pecuniary gain in some
employments, and counterbalance a great one in others. First, the
agreeableness or disagreeableness of the employments themselves;
secondly, the easiness and cheapness, or the difficulty and expense of
learning them ; thirdly, the constancy or inconstancy of employment in
them ; fourthly, the small or great trust which must be reposed in those
who exercise them; and, fifthly, the probability or improbability of
success in them.

First, the wages of labour vary with the ease or hardship, the
cleanliness or dirtiness, the honourableness or dishonourableness, of
the employment. Thus in most places, take the year round, a journeyman
tailor earns less than a journeyman weaver. His work is much easier. A
journeyman weaver earns less than a journeyman smith. His work is not
always easier, but it is much cleanlier. A journeyman blacksmith, though
an artificer, seldom earns so much in twelve hours, as a collier, who is
only a labourer, does in eight. His work is not quite so dirty, is less
dangerous, and is carried on in day-light, and above ground. Honour
makes a great part of the reward of all honourable professions. In point
of pecuniary gain, all things considered, they are generally under-
recompensed, as I shall endeavour to shew by and by. Disgrace has the
contrary effect. The trade of a butcher is a brutal and an odious
business ; but it is in most places more profitable than the greater
part of common trades. The most detestable of all employments, that of
public executioner, is, in proportion to the quantity of work done,
better paid than any common trade whatever.

Hunting and fishing, the most important employments of mankind in the
rude state of society, become, in its advanced state, their most
agreeable amusements, and they pursue for pleasure what they once
followed from necessity. In the advanced state of society, therefore,
they are all very poor people who follow as a trade, what other people
pursue as a pastime. Fishermen have been so since the time of
Theocritus. {See Idyllium xxi.}. A poacher is everywhere a very poor man
in Great Britain. In countries where the rigour of the law suffers no
poachers, the licensed hunter is not in a much better condition. The
natural taste for those employments makes more people follow them, than
can live comfortably by them; and the produce of their labour, in
proportion to its quantity, comes always too cheap to market, to afford
any thing but the most scanty subsistence to the labourers.

Disagreeableness and disgrace affect the profits of stock in the same
manner as the wages of labour. The keeper of an inn or tavern, who is
never master of his own house, and who is exposed to the brutality of
every drunkard, exercises neither a very agreeable nor a very creditable
business. But there is scarce any common trade in which a small stock
yields so great a profit.

Secondly, the wages of labour vary with the easiness and cheapness, or
the difficulty and expense, of learning the business.

When any expensive machine is erected, the extraordinary work to be
performed by it before it is worn out, it must be expected, will replace
the capital laid out upon it, with at least the ordinary profits. A man
educated at the expense of much labour and time to any of those
employments which require extraordinary dexterity and skill, may be
compared to one of those expensive machines. The work which he learns to
perform, it must be expected, over and above the usual wages of common
labour, will replace to him the whole expense of his education, with at
least the ordinary profits of an equally valuable capital. It must do
this too in a reasonable time, regard being had to the very uncertain
duration of human life, in the same manner as to the more certain
duration of the machine.

The difference between the wages of skilled labour and those of common
labour, is founded upon this principle.

The policy of Europe considers the labour of all mechanics, artificers,
and manufacturers, as skilled labour ; and that of all country labourers
us common labour. It seems to suppose that of the former to be of a more
nice and delicate nature than that of the latter. It is so perhaps in
some cases ; but in the greater part it is quite otherwise, as I shall
endeavour to shew by and by. The laws and customs of Europe, therefore,
in order to qualify any person for exercising the one species of labour,
impose the necessity of an apprenticeship, though with different degrees
of rigour in different places. They leave the other free and open to
every body. During the continuance of the apprenticeship, the whole
labour of the apprentice belongs to his master. In the meantime he must,
in many cases, be maintained by his parents or relations, and, in almost
all cases, must be clothed by them. Some money, too, is commonly given
to the master for teaching him his trade. They who cannot give money,
give time, or become bound for more than the usual number of years ; a
consideration which, though it is not always advantageous to the master,
on account of the usual idleness of apprentices, is always
disadvantageous to the apprentice. In country labour, on the contrary,
the labourer, while he is employed about the easier, learns the more
difficult parts of his business, and his own labour maintains him
through all the different stages of his employment. It is reasonable,
therefore, that in Europe the wages of mechanics, artificers, and
manufacturers, should be somewhat higher than those of common labourers.
They are so accordingly, and their superior gains make them, in most
places, be considered as a superior rank of people. This superiority,
however, is generally very small: the daily or weekly earnings of
journeymen in the more common sorts of manufactures, such as those of
plain linen and woollen cloth, computed at an average, are, in most
places, very little more than the day-wages of common labourers. Their
employment, indeed, is more steady and uniform, and the superiority of
their earnings, taking the whole year together, may be somewhat greater.
It seems evidently, however, to be no greater than what is sufficient to
compensate the superior expense of their education. Education in the
ingenious arts, and in the liberal professions, is still more tedious
and expensive. The pecuniary recompence, therefore, of painters and
sculptors, of lawyers and physicians, ought to be much more liberal; and
it is so accordingly.

The profits of stock seem to be very little affected by the easiness or
difficulty of learning the trade in which it is employed. All the
different ways in which stock is commonly employed in great towns seem,
in reality, to be almost equally easy and equally difficult to learn.
One branch, either of foreign or domestic trade, cannot well be a much
more intricate business than another.

Thirdly, the wages of labour in different occupations vary with the
constancy or inconstancy of employment.

Employment is much more constant in some trades than in others. In the
greater part of manufactures, a journeyman maybe pretty sure of
employment almost every day in the year that he is able to work. A mason
or bricklayer, on the contrary, can work neither in hard frost nor in
foul weather, and his employment at all other times depends upon the
occasional calls of his customers. He is liable, in consequence, to be
frequently without any. What he earns, therefore, while he is employed,
must not only maintain him while he is idle, but make him some
compensation for those anxious and desponding moments which the thought
of so precarious a situation must sometimes occasion. Where the computed
earnings of the greater part of manufacturers, accordingly, are nearly
upon a level with the day-wages of common labourers, those of masons and
bricklayers are generally from one-half more to double those wages.
Where common labourers earn four or five shillings a-week, masons and
bricklayers frequently earn seven and eight; where the former earn six,
the latter often earn nine and ten ; and where the former earn nine and
ten, as in London, the latter commonly earn fifteen and eighteen. No
species of skilled labour, however, seems more easy to learn than that
of masons and bricklayers. Chairmen in London, during the summer season,
are said sometimes to be employed as bricklayers. The high wages of
those workmen, therefore, are not so much the recompence of their skill,
as the compensation for the inconstancy of their employment.

A house-carpenter seems to exercise rather a nicer and a more ingenious
trade than a mason. In most places, however, for it is not universally
so, his day-wages are somewhat lower. His employment, though it depends
much, does not depend so entirely upon the occasional calls of his
customers; and it is not liable to be interrupted by the weather.

When the trades which generally afford constant employment, happen in a
particular place not to do so, the wages of the workmen always rise a
good deal above their ordinary proportion to those of common labour. In
London, almost all journeymen artificers are liable to be called upon
and dismissed by their masters from day to day, and from week to week,
in the same manner as day-labourers in other places. The lowest order of
artificers, journeymen tailors, accordingly, earn their half-a-crown a-
day, though eighteen pence may be reckoned the wages of common labour.
In small towns and country villages, the wages of journeymen tailors
frequently scarce equal those of common labour ; but in London they are
often many weeks without employment, particularly during the summer.

When the inconstancy of employment is combined with the hardship,
disagreeableness, and dirtiness of the work, it sometimes raises the
wages of the most common labour above those of the most skilful
artificers. A collier working by the piece is supposed, at Newcastle, to
earn commonly about double, and, in many parts of Scotland, about three
times, the wages of common labour. His high wages arise altogether from
the hardship, disagreeableness, and dirtiness of his work. His
employment may, upon most occasions, be as constant as he pleases. The
coal-heavers in London exercise a trade which, in hardship, dirtiness,
and disagreeableness, almost equals that of colliers ; and, from the
unavoidable irregularity in the arrivals of coal-ships, the employment
of the greater part of them is necessarily very inconstant. If colliers,
therefore, commonly earn double and triple the wages of common labour,
it ought not to seem unreasonable that coal-heavers should sometimes
earn four and five times those wages. In the inquiry made into their
condition a few years ago, it was found that, at the rate at which they
were then paid, they could earn from six to ten shillings a-day. Six
shillings are about four times the wages of common labour in London;
and, in every particular trade, the lowest common earnings may always be
considered as those of the far greater number. How extravagant soever
those earnings may appear, if they were more than sufficient to
compensate all the disagreeable circumstances of the business, there
would soon be so great a number of competitors, as, in a trade which has
no exclusive privilege, would quickly reduce them to a lower rate.

The constancy or inconstancy of employment cannot affect the ordinary
profits of stock in any particular trade. Whether the stock is or is not
constantly employed, depends, not upon the trade, but the trader.

Fourthly, the wages of labour vary according to the small or great trust
which must be reposed in the workmen.

The wages of goldsmiths and jewellers are everywhere superior to those
of many other workmen, not only of equal, but of much superior
ingenuity, on account of the precious materials with which they are
entrusted. We trust our health to the physician, our fortune, and
sometimes our life and reputation, to the lawyer and attorney. Such
confidence could not safely be reposed in people of a very mean or low
condition. Their reward must be such, therefore, as may give them that
rank in the society which so important a trust requires. The long time
and the great expense which must be laid out in their education, when
combined with this circumstance, necessarily enhance still further the
price of their labour.

When a person employs only his own stock in trade, there is no trust;
and the credit which he may get from other people, depends, not upon the
nature of the trade, but upon their opinion of his fortune, probity and
prudence. The different rates of profit, therefore, in the different
branches of trade, cannot arise from the different degrees of trust
reposed in the traders.

Fifthly, the wages of labour in different employments vary according to
the probability or improbability of success in them.

The probability that any particular person shall ever be qualified for
the employments to which he is educated, is very different in different
occupations. In the greatest part of mechanic trades success is almost
certain; but very uncertain in the liberal professions. Put your son
apprentice to a shoemaker, there is little doubt of his learning to make
a pair of shoes; but send him to study the law, it as at least twenty to
one if he ever makes such proficiency as will enable him to live by the
business. In a perfectly fair lottery, those who draw the prizes ought
to gain all that is lost by those who draw the blanks. In a profession,
where twenty fail for one that succeeds, that one ought to gain all that
should have been gained by the unsuccessful twenty. The counsellor at
law, who, perhaps, at near forty years of age, begins to make something
by his profession, ought to receive the retribution, not only of his own
so tedious and expensive education, but of that of more than twenty
others, who are never likely to make any thing by it. How extravagant
soever the fees of counsellors at law may sometimes appear, their real
retribution is never equal to this. Compute, in any particular place,
what is likely to be annually gained, and what is likely to be annually
spent, by all the different workmen in any common trade, such as that of
shoemakers or weavers, and you will find that the former sum will
generally exceed the latter. But make the same computation with regard
to all the counsellors and students of law, in all the different Inns of
Court, and you will find that their annual gains bear but a very small
proportion to their annual expense, even though you rate the former as
high, and the latter as low, as can well be done. The lottery of the
law, therefore, is very far from being a perfectly fair lottery ; and
that as well as many other liberal and honourable professions, is, in
point of pecuniary gain, evidently under-recompensed.

      Those professions keep their level, however, with other
occupations ; and, notwithstanding these discouragements, all the most
generous and liberal spirits are eager to crowd into them. Two different
causes contribute to recommend them. First, the desire of the reputation
which attends upon superior excellence in any of them ; and, secondly,
the natural confidence which every man has, more or less, not only in
his own abilities, but in his own good fortune.

To excel in any profession, in which but few arrive at mediocrity, it is
the most decisive mark of what is called genius, or superior talents.
The public admiration which attends upon such distinguished abilities
makes always a part of their reward; a greater or smaller, in proportion
as it is higher or lower in degree. It makes a considerable part of that
reward in the profession of physic ; a still greater, perhaps, in that
of law; in poetry and philosophy it makes almost the whole.

There are some very agreeable and beautiful talents, of which the
possession commands a certain sort of admiration, but of which the
exercise, for the sake of gain, is considered, whether from reason or
prejudice, as a sort of public prostitution. The pecuniary recompence,
therefore, of those who exercise them in this manner, must be
sufficient, not only to pay for the time, labour, and expense of
acquiring the talents, but for the discredit which attends the
employment of them as the means of subsistence. The exorbitant rewards
of players, opera-singers, opera-dancers, etc. are founded upon those
two principles ; the rarity and beauty of the talents, and the discredit
of employing them in this manner. It seems absurd at first sight, that
we should despise their persons, and yet reward their talents with the
most profuse liberality. While we do the one, however, we must of
necessity do the other, Should the public opinion or prejudice ever
alter with regard to such occupations, their pecuniary recompence would
quickly diminish. More people would apply to them, and the competition
would quickly reduce the price of their labour. Such talents, though far
from being common, are by no means so rare as imagined. Many people
possess them in great perfection, who disdain to make this use of them;
and many more are capable of acquiring them, if any thing could be made
honourably by them.

The over-weening conceit which the greater part of men have of their own
abilities, is an ancient evil remarked by the philosophers and moralists
of all ages. Their absurd presumption in their own good fortune has been
less taken notice of. It is, however, if possible, still more universal.
There is no man living, who, when in tolerable health and spirits, has
not some share of it. The chance of gain is by every man more or less
over-valued, and the chance of loss is by most men under-valued, and by
scarce any man, who is in tolerable health and spirits, valued more than
it is worth.

That the chance of gain is naturally overvalued, we may learn from the
universal success of lotteries. The world neither ever saw, nor ever
will see, a perfectly fair lottery, or one in which the whole gain
compensated the whole loss; because the undertaker could make nothing by
it. In the state lotteries, the tickets are really not worth the price
which is paid by the original subscribers, and yet commonly sell in the
market for twenty, thirty, and sometimes forty per cent. advance. The
vain hopes of gaining some of the great prizes is the sole cause of this
demand. The soberest people scarce look upon it as a folly to pay a
small sum for the chance of gaining ten or twenty thousand pounds,
though they know that even that small sum is perhaps twenty or thirty
per cent. more than the chance is worth. In a lottery in which no prize
exceeded twenty pounds, though in other respects it approached much
nearer to a perfectly fair one than the common state lotteries, there
would not be the same demand for tickets. In order to have a better
chance for some of the great prizes, some people purchase several
tickets ; and others, small shares in a still greater number. There is
not, however, a more certain proposition in mathematics, than that the
more tickets you adventure upon, the more likely you are to be a loser.
Adventure upon all the tickets in the lottery, and you lose for certain
; and the greater the number of your tickets, the nearer you approach to
this certainty.

That the chance of loss is frequently undervalued, and scarce ever
valued more than it is worth, we may learn from the very moderate profit
of insurers. In order to make insurance, either from fire or sea-risk, a
trade at all, the common premium must be sufficient to compensate the
common losses, to pay the expense of management, and to afford such a
profit as might have been drawn from an equal capital employed in any
common trade. The person who pays no more than this, evidently pays no
more than the real value of the risk, or the lowest price at which he
can reasonably expect to insure it. But though many people have made a
little money by insurance, very few have made a great fortune; and, from
this consideration alone, it seems evident enough that the ordinary
balance of profit and loss is not more advantageous in this than in
other common trades, by which so many people make fortunes. Moderate,
however, as the premium of insurance commonly is, many people despise
the risk too much to care to pay it. Taking the whole kingdom at an
average, nineteen houses in twenty, or rather, perhaps, ninety-nine in a
hundred, are not insured from fire. Sea-risk is more alarming to the
greater part of people ; and the proportion of ships insured to those
not insured is much greater.     Many sail, however, at all seasons, and
even in time of war, without any insurance. This may sometimes, perhaps,
be done without any imprudence. When a great company, or even a great
merchant, has twenty or thirty ships at sea, they may, as it were,
insure one another. The premium saved up on them all may more than
compensate such losses as they are likely to meet with in the common
course of chances. The neglect of insurance upon shipping, however, in
the same manner as upon houses, is, in most cases, the effect of no such
nice calculation, but of mere thoughtless rashness, and presumptuous
contempt of the risk.

The contempt of risk, and the presumptuous hope of success, are in no
period of life more active than at the age at which young people choose
their professions. How little the fear of misfortune is then capable of
balancing the hope of good luck, appears still more evidently in the
readiness of the common people to enlist as soldiers, or to go to sea,
than in the eagerness of those of better fashion to enter into what are
called the liberal professions.

What a common soldier may lose is obvious enough. Without regarding the
danger, however, young volunteers never enlist so readily as at the
beginning of a new war ; and though they have scarce any chance of
preferment, they figure to themselves, in their youthful fancies, a
thousand occasions of acquiring honour and distinction which never
occur. These romantic hopes make the whole price of their blood. Their
pay is less than that of common labourers, and, in actual service, their
fatigues are much greater.

The lottery of the sea is not altogether so disadvantageous as that of
the army. The son of a creditable labourer or artificer may frequently
go to sea with his father's consent ; but if he enlists as a soldier, it
is always without it. Other people see some chance of his making
something by the one trade; nobody but himself sees any of his making
any thing by the other. The great admiral is less the object of public
admiration than the great general ; and the highest success in the sea
service promises a less brilliant fortune and reputation than equal
success in the land. The same difference runs through all the inferior
degrees of preferment in both. By the rules of precedency, a captain in
the navy ranks with a colonel in the army ; but he does not rank with
him in the common estimation. As the great prizes in the lottery are
less, the smaller ones must be more numerous. Common sailors, therefore,
more frequently get some fortune and preferment than common soldiers ;
and the hope of those prizes is what principally recommends the trade.
Though their skill and dexterity are much superior to that of almost any
artificers; and though their whole life is one continual scene of
hardship and danger ; yet for all this dexterity and skill, for all
those hardships and dangers, while they remain in the condition of
common sailors, they receive scarce any other recompence but the
pleasure of exercising the one and of surmounting the other.     Their
wages are not greater than those of common labourers at the port which
regulates the rate of seamen's wages. As they are continually going from
port to port, the monthly pay of those who sail from all the different
ports of Great Britain, is more nearly upon a level than that of any
other workmen in those different places ; and the rate of the port to
and from which the greatest number sail, that is, the port of London,
regulates that of all the rest. At London, the wages of the greater part
of the different classes of workmen are about double those of the same
classes at Edinburgh. But the sailors who sail from the port of London,
seldom earn above three or four shillings a month more than those who
sail from the port of Leith, and the difference is frequently not so
great. In time of peace, and in the merchant-service, the London price
is from a guinea to about seven-and-twenty shillings the calendar month.
A common labourer in London, at the rate of nine or ten shillings a
week, may earn in the calendar month from forty to five-and-forty
shillings. The sailor, indeed, over and above his pay, is supplied with
provisions. Their value, however, may not perhaps always exceed the
difference between his pay and that of the common labourer ; and though
it sometimes should, the excess will not be clear gain to the sailor,
because he cannot share it with his wife and family, whom he must
maintain out of his wages at home.

The dangers and hair-breadth escapes of a life of adventures, instead of
disheartening young people, seem frequently to recommend a trade to
them. A tender mother, among the inferior ranks of people, is often
afraid to send her son to school at a sea-port town, lest the sight of
the ships, and the conversation and adventures of the sailors, should
entice him to go to sea. The distant prospect of hazards, from which we
can hope to extricate ourselves by courage and address, is not
disagreeable to us, and does not raise the wages of labour in any
employment. It is otherwise with those in which courage and address can
be of no avail. In trades which are known to be very unwholesome, the
wages of labour are always remarkably high. Unwholesomeness is a species
of disagreeableness, and its effects upon the wages of labour are to be
ranked under that general head.

In all the different employments of stock, the ordinary rate of profit
varies more or less with the certainty or uncertainty of the returns.
These are, in general, less uncertain in the inland than in the foreign
trade, and in some branches of foreign trade than in others ; in the
trade to North America, for example, than in that to Jamaica. The
ordinary rate of profit always rises more or less with the risk. it does
not, however, seem to rise in proportion to it, or so as to compensate
it completely. Bankruptcies are most frequent in the most hazardous
trades. The most hazardous of all trades, that of a smuggler, though,
when the adventure succeeds, it is likewise the most profitable, is the
infallible road to bankruptcy. The presumptuous hope of success seems to
act here as upon all other occasions, and to entice so many adventurers
into those hazardous trades, that their competition reduces the profit
below what is sufficient to compensate the risk. To compensate it
completely, the common returns ought, over and above the ordinary
profits of stock, not only to make up for all occasional losses, but to
afford a surplus profit to the adventurers, of the same nature with the
profit of insurers. But if the common returns were sufficient for all
this, bankruptcies would not be more frequent in these than in other
trades.

Of the five circumstances, therefore, which vary the wages of labour,
two only affect the profits of stock ; the agreeableness or
disagreeableness of the business, and the risk or security with which it
is attended. In point of agreeableness or disagreeableness, there is
little or no difference in the far greater part of the different
employments of stock, but a great deal in those of labour ; and the
ordinary profit of stock, though it rises with the risk, does not always
seem to rise in proportion to it. It should follow from all this, that,
in the same society or neighbourhood, the average and ordinary rates of
profit in the different employments of stock should he more nearly upon
a level than the pecuniary wages of the different sorts of labour.

They are so accordingly. The difference between the earnings of a common
labourer and those of a well employed lawyer or physician, is evidently
much greater than that between the ordinary profits in any two different
branches of trade. The apparent difference, besides, in the profits of
different trades, is generally a deception arising from our not always
distinguishing what ought to be considered as wages, from what ought to
be considered as profit.

Apothecaries' profit is become a bye-word, denoting something uncommonly
extravagant. This great apparent profit, however, is frequently no more
than the reasonable wages of labour. The skill of an apothecary is a
much nicer and more delicate matter than that of any artificer whatever
; and the trust which is reposed in him is of much greater importance.
He is the physician of the poor in all cases, and of the rich when the
distress or danger is not very great. His reward, therefore, ought to be
suitable to his skill and his trust ; and it arises generally from the
price at which he sells his drugs. But the whole drugs which the best
employed apothecary in a large market-town, will sell in a year, may not
perhaps cost him above thirty or forty pounds. Though he should sell
them, therefore, for three or four hundred, or at a thousand per cent.
profit, this may frequently be no more than the reasonable wages of his
labour, charged, in the only way in which he can charge them, upon the
price of his drugs. The greater part of the apparent profit is real
wages disguised in the garb of profit.

In a small sea-port town, a little grocer will make forty or fifty per
cent. upon a stock of a single hundred pounds, while a considerable
wholesale merchant in the same place will scarce make eight or ten per
cent. upon a stock of ten thousand. The trade of the grocer may be
necessary for the conveniency of the inhabitants, and the narrowness of
the market may not admit the employment of a larger capital in the
business. The man, however, must not only live by his trade, but live by
it suitably to the qualifications which it requires. Besides possessing
a little capital, he must be able to read, write, and account and must
be a tolerable judge, too, of perhaps fifty or sixty different sorts of
goods, their prices, qualities, and the markets where they are to be had
cheapest. He must have all the knowledge, in short, that is necessary
for a great merchant, which nothing hinders him from becoming but the
want of a sufficient capital. Thirty or forty pounds a year cannot be
considered as too great a recompence for the labour of a person so
accomplished. Deduct this from the seemingly great profits of his
capital, and little more will remain, perhaps, than the ordinary profits
of stock. The greater part of the apparent profit is, in this case too,
real wages.

The difference between the apparent profit of the retail and that of the
wholesale trade, is much less in the capital than in small towns and
country villages. Where ten thousand pounds can be employed in the
grocery trade, the wages of the grocer's labour must be a very trifling
addition to the real profits of so great a stock. The apparent profits
of the wealthy retailer, therefore, are there more nearly upon a level
with those of the wholesale merchant. It is upon this account that goods
sold by retail are generally as cheap, and frequently much cheaper, in
the capital than in small towns and country villages. Grocery goods, for
example, are generally much cheaper ; bread and butchers' meat
frequently as cheap. It costs no more to bring grocery goods to the
great town than to the country village ; but it costs a great deal more
to bring corn and cattle, as the greater part of them must be brought
from a much greater distance. The prime cost of grocery goods,
therefore, being the same in both places, they are cheapest where the
least profit is charged upon them. The prime cost of bread and butchers'
meat is greater in the great town than in the country village; and
though the profit is less, therefore they are not always cheaper there,
but often equally cheap. In such articles as bread and butchers' meat,
the same cause which diminishes apparent profit, increases prime cost.
The extent of the market, by giving employment to greater stocks,
diminishes apparent profit; but by requiring supplies from a greater
distance, it increases prime cost. This diminution of the one and
increase of the other, seem, in most cases, nearly to counterbalance one
another ; which is probably the reason that, though the prices of corn
and cattle are commonly very different in different parts of the
kingdom, those of bread and butchers' meat are generally very nearly the
same through the greater part of it.

Though the profits of stock, both in the wholesale and retail trade, are
generally less in the capital than in small towns and country villages,
yet great fortunes are frequently acquired from small beginnings in the
former, and scarce ever in the latter. In small towns and country
villages, on account of the narrowness of the market, trade cannot
always be extended as stock extends. In such places, therefore, though
the rate of a particular person's profits may be very high, the sum or
amount of them can never be very great, nor consequently that of his
annual accumulation. In great towns, on the contrary, trade can be
extended as stock increases, and the credit of a frugal and thriving man
increases much faster than his stock. His trade is extended in
proportion to the amount of both ; and the sum or amount of his profits
is in proportion to the extent of his trade, and his annual accumulation
in proportion to the amount of his profits. It seldom happens, however,
that great fortunes are made, even in great towns, by any one regular,
established, and well-known branch of business, but in consequence of a
long life of industry, frugality, and attention. Sudden fortunes,
indeed, are sometimes made in such places, by what is called the trade
of speculation. The speculative merchant exercises no one regular,
established, or well-known branch of business. He is a corn merchant
this year, and a wine merchant the next, and a sugar, tobacco, or tea
merchant the year after. He enters into every trade, when he foresees
that it is likely to lie more than commonly profitable, and he quits it
when he foresees that its profits are likely to return to the level of
other trades. His profits and losses, therefore, can bear no regular
proportion to those of any one established and well-known branch of
business. A bold adventurer may sometimes acquire a considerable fortune
by two or three successful speculations, but is just as likely to lose
one by two or three unsuccessful ones. This trade can be carried on
nowhere but in great towns. It is only in places of the most extensive
commerce and correspondence that the intelligence requisite for it can
be had.

The five circumstances above mentioned, though they occasion
considerable inequalities in the wages of labour and profits of stock,
occasion none in the whole of the advantages and disadvantages, real or
imaginary, of the different employments of either. The nature of those
circumstances is such, that they make up for a small pecuniary gain in
some, and counterbalance a great one in others.

In order, however, that this equality may take place in the whole of
their advantages or disadvantages, three things are requisite, even
where there is the most perfect freedom. First the employments must be
well known and long established in the neighbourhood; secondly, they
must be in their ordinary, or what may be called their natural state ;
and, thirdly, they must be the sole or principal employments of those
who occupy them.

First, This equality can take place only in those employments which are
well known, and have been long established in the neighbourhood.

Where all other circumstances are equal, wages are generally higher in
new than in old trades. When a projector attempts to establish a new
manufacture, he must at first entice his workmen from other employments,
by higher wages than they can either earn in their own trades, or than
the nature of his work would otherwise require ; and a considerable time
must pass away before he can venture to reduce them to the common level.
Manufactures for which the demand arises altogether from fashion and
fancy, are continually changing, and seldom last long enough to be
considered as old established manufactures. Those, on the contrary, for
which the demand arises chiefly from use or necessity, are less liable
to change, and the same form or fabric may continue in demand for whole
centuries together. The wages of labour, therefore, are likely to be
higher in manufactures of the former, than in those of the latter kind.
Birmingham deals chiefly in manufactures of the former kind ; Sheffield
in those of the latter ; and the wages of labour in those two different
places are said to be suitable to this difference in the nature of their
manufactures.

The establishment of any new manufacture, of any new branch of commerce,
or of any new practice in agriculture, is always a speculation from
which the projector promises himself extraordinary profits. These
profits sometimes are very great, and sometimes, more frequently,
perhaps, they are quite otherwise ; but, in general, they bear no
regular proportion to those of other old trades in the neighbourhood. If
the project succeeds, they are commonly at first very high. When the
trade or practice becomes thoroughly established and well known, the
competition reduces them to the level of other trades.

Secondly, this equality in the whole of the advantages and disadvantages
of the different employments of labour and stock, can take place only in
the ordinary, or what may be called the natural state of those
employments.

The demand for almost every different species of labour is sometimes
greater, and sometimes less than usual. In the one case, the advantages
of the employment rise above, in the other they fall below the common
level. The demand for country labour is greater at hay-time and harvest
than during the greater part of the year ; and wages rise with the
demand. In time of war, when forty or fifty thousand sailors are forced
from the merchant service into that of the king, the demand for sailors
to merchant ships necessarily rises with their scarcity ; and their
wages, upon such occasions, commonly rise from a guinea and seven-and-
twenty shillings to forty shilling's and three pounds a-month. In a
decaying manufacture, on the contrary, many workmen, rather than quit
their own trade, are contented with smaller wages than would otherwise
be suitable to the nature of their employment.

The profits of stock vary with the price of the commodities in which it
is employed. As the price of any commodity rises above the ordinary or
average rate, the profits of at least some part of the stock that is
employed in bringing it to market, rise above their proper level, and as
it falls they sink below it. All commodities are more or less liable to
variations of price, but some are much more so than others. In all
commodities which are produced by human industry, the quantity of
industry annually employed is necessarily regulated by the annual
demand, in such a manner that the average annual produce may, as nearly
as possible, be equal to the average annual consumption. In some
employments, it has already been observed, the same quantity of industry
will always produce the same, or very nearly the same quantity of
commodities. In the linen or woollen manufactures, for example, the same
number of hands will annually work up very nearly the same quantity of
linen and woollen cloth. The variations in the market price of such
commodities, therefore, can arise only from some accidental variation in
the demand. A public mourning raises the price of black cloth. But as
the demand for most sorts of plain linen and woollen cloth is pretty
uniform. so is likewise the price. But there are other employments in
which the same quantity of industry will not always produce the same
quantity of commodities. The same quantity of industry, for example,
will, in different years, produce very different quantities of corn,
wine, hops, sugar tobacco, etc. The price of such commodities,
therefore, varies not only with the variations of demand, but with the
much greater and more frequent variations of quantity, and is
consequently extremely fluctuating; but the profit of some of the
dealers must necessarily fluctuate with the price of the commodities.
The operations of the speculative merchant are principally employed
about such commodities. He endeavours to buy them up when he foresees
that their price is likely to rise, and to sell them when it is likely
to fall.

Thirdly, this equality in the whole of the advantages and disadvantages
of the different employments of labour and stock, can take place only in
such as are the sole or principal employments of those who occupy them.

When a person derives his subsistence from one employment, which does
not occupy the greater part of his time, in the intervals of his leisure
he is often willing to work at another for less wages than would
otherwise suit the nature of the employment.

There still subsists, in many parts of Scotland, a set of people called
cottars or cottagers, though they were more frequent some years ago than
they are now. They are a sort of out-servants of the landlords and
farmers. The usual reward which they receive from their master is a
house, a small garden for pot-herbs, as much grass as will feed a cow,
and, perhaps, an acre or two of bad arable land. When their master has
occasion for their labour, he gives them, besides, two pecks of oatmeal
a-week, worth about sixteen pence sterling. During a great part of the
year, he has little or no occasion for their labour, and the cultivation
of their own little possession is not sufficient to occupy the time
which is left at their own disposal. When such occupiers were more
numerous than they are at present, they are said to have been willing to
give their spare time for a very small recompence to any body, and to
have wrought for less wages than other labourers.     In ancient times,
they seem to have been common all over Europe. In countries ill
cultivated, and worse inhabited, the greater part of landlords and
farmers could not otherwise provide themselves with the extraordinary
number of hands which country labour requires at certain seasons. The
daily or weekly recompence which such labourers occasionally received
from their masters, was evidently not the whole price of their labour.
Their small tenement made a considerable part of it. This daily or
weekly recompence, however, seems to have been considered as the whole
of it, by many writers who have collected the prices of labour and
provisions in ancient times, and who have taken pleasure in representing
both as wonderfully low.

The produce of such labour comes frequently cheaper to market than would
otherwise be suitable to its nature. Stockings, in many parts of
Scotland, are knit much cheaper than they can anywhere be wrought upon
the loom. They are the work of servants and labourers who derive the
principal part of their subsistence from some other employment. More
than a thousand pair of Shetland stockings are annually imported into
Leith, of which the price is from fivepence to seven-pence a pair. At
Lerwick, the small capital of the Shetland islands, tenpence a-day, I
have been assured, is a common price of common labour. In the same
islands, they knit worsted stockings to the value of a guinea a pair and
upwards.

The spinning of linen yarn is carried on in Scotland nearly in the same
way as the knitting of stockings, by servants, who are chiefly hired for
other purposes. They earn but a very scanty subsistence, who endeavour
to get their livelihood by either of those trades. In most parts of
Scotland, she is a good spinner who can earn twentypence a-week.

In opulent countries, the market is generally so extensive, that any one
trade is sufficient to employ the whole labour and stock of those who
occupy it. Instances of people living by one employment,  and,  at the
same time, deriving some little advantage from another, occur chiefly in
pour countries. The following instance, however, of something of the
same kind, is to be found in the capital of a very rich one. There is no
city in Europe, I believe, in which house-rent is dearer than in London,
and yet I know no capital in which a furnished apartment can be hired so
cheap. Lodging is not only much cheaper in London than in Paris; it is
much cheaper than in Edinburgh, of the same degree of goodness ; and,
what may seem extraordinary, the dearness of house-rent is the cause of
the cheapness of lodging. The dearness of house-rent in London arises,
not only from those causes which render it dear in all great capitals,
the dearness of labour, the dearness of all the materials of building,
which must generally be brought from a great distance, and, above all,
the dearness of ground-rent, every landlord acting the part of a
monopolist, and frequently exacting a higher rent for a single acre of
bad land in a town, than can be had for a hundred of the best in the
country; but it arises in part from the peculiar manners and customs of
the people, which oblige every master of a family to hire a whole house
from top to bottom. A dwelling-house in England means every thing that
is contained under the same roof. In France, Scotland, and many other
parts of Europe, it frequently means no more than a single storey. A
tradesman in London is obliged to hire a whole house in that part of the
town where his customers live. His shop is upon the ground floor, and he
and his family sleep in the garret ; and he endeavours to pay a part of
his house-rent by letting the two middle storeys to lodgers. He expects
to maintain his family by his trade, and not by his lodgers. Whereas at
Paris and  Edinburgh, people who let lodgings have commonly no other
means of subsistence ; and the price of the lodging must pay, not only
the rent of the house, but the whole expense of the family.

PART II. ˜  Inequalities occasioned by the Policy of Europe.

Such are the inequalities in the whole of the advantages and
disadvantages of the different employments of labour and stock, which
the defect of any of the three requisites above mentioned must occasion,
even where there is the most perfect liberty. But the policy of Europe,
by not leaving things at perfect liberty, occasions other inequalities
of much greater importance.

It does this chiefly in the three following ways. First, by restraining
the competition in some employments to a smaller number than would
otherwise be disposed to enter into them ; secondly, by increasing it in
others beyond what it naturally would be; and, thirdly, by obstructing
the free circulation of labour and stock, both from employment to
employment, and from place to place.

First, The policy of Europe occasions a very important inequality in the
whole of the advantages and disadvantages of the different employments
of labour and stock, by restraining the competition in some employments
to a smaller number than might otherwise be disposed to enter into them.

The exclusive privileges of corporations are the principal means it
makes use of for this purpose.

The exclusive privilege of an incorporated trade necessarily restrains
the competition, in the town where it is established, to those who are
free of the trade. To have served an apprenticeship in the town, under a
master properly qualified, is commonly the necessary requisite for
obtaining this freedom. The bye-laws of the corporation regulate
sometimes the number of apprentices which any master is allowed to have,
and almost always the number of years which each apprentice is obliged
to serve. The intention of both regulations is to restrain the
competition to a much smaller number than might otherwise be disposed to
enter into the trade. The limitation of the number of apprentices
restrains it directly. A long term of apprenticeship restrains it more
indirectly, but as effectually, by increasing the expense of education.

In Sheffield, no master cutler can have more than one apprentice at a
time, by a bye-law of the corporation. In Norfolk and Norwich, no master
weaver can have more than two apprentices, under pain of forfeiting five
pounds a-month to the king. No master hatter can have more than two
apprentices anywhere in England, or in the English plantations, under
pain of forfeiting; five pounds a-month, half to the king, and half to
him who shall sue in any court of record. Both these regulations, though
they have been confirmed by a public law of the kingdom, are evidently
dictated by the same corporation-spirit which enacted the bye-law of
Sheffield. The silk-weavers in London had scarce been incorporated a
year, when they enacted a bye-law, restraining any master from having
more than two apprentices at a time. It required a particular act of
parliament to rescind this bye-law.

Seven years seem anciently to have been, all over Europe, the usual term
established for the duration of apprenticeships in the greater part of
incorporated trades. All such incorporations were anciently called
universities, which, indeed, is the proper Latin name for any
incorporation whatever. The university of smiths, the university of
tailors, etc. are expressions which we commonly meet with in the old
charters of ancient towns. When those particular incorporations, which
are now peculiarly called universities, were first established, the term
of years which it was necessary to study, in order to obtain the degree
of master of arts, appears evidently to have been copied from the term
of apprenticeship in common trades, of which the incorporations were
much more ancient. As to have wrought seven years under a master
properly qualified, was necessary, in order to entitle my person to
become a master, and to have himself apprentices in a common trade ; so
to have studied seven years under a master properly qualified. was
necessary to entitle him to become a master, teacher, or doctor (words
anciently synonymous), in the liberal arts, and to have scholars or
apprentices (words likewise originally synonymous) to study under him.

By the 5th of Elizabeth, commonly called the Statute of Apprenticeship,
it was enacted, that no person should, for the future, exercise any
trade, craft, or mystery, at that time exercised in England, unless he
had previously served to it an apprenticeship of seven years at least ;
and what before had been the bye-law of many particular corporations,
became in England the general and public law of all trades carried on in
market towns. For though the words of the statute are very general, and
seem plainly to include the whole kingdom, by interpretation its
operation has been limited to market towns; it having been held that, in
country villages, a person may exercise several different trades, though
he has not served a seven years apprenticeship to each, they being
necessary for the conveniency of the inhabitants, and the number of
people frequently not being sufficient to supply each with a particular
set of hands. By a strict interpretation of the words, too, the
operation of this statute has been limited to those trades which were
established in England before the 5th of Elizabeth, and has never been
extended to such as have been introduced since that time. This
limitation has given occasion to several distinctions, which, considered
as rules of police, appear as foolish as can well be imagined. It has
been adjudged, for example, that a coach-maker can neither himself make
nor employ journeymen to make his coach-wheels, but must buy them of a
master wheel-wright; this latter trade having been exercised in England
before the 5th of Elizabeth. But a wheel-wright, though he has never
served an apprenticeship to a coachmaker, may either himself make or
employ journeymen to make coaches; the trade of a coachmaker not being
within the statute, because not exercised in England at the time when it
was made. The manufactures of Manchester, Birmingham, and Wolverhampton,
are many of them, upon this account, not within the statute, not having
been exercised in England before the 5th of Elizabeth.

In France, the duration of apprenticeships is different in different
towns and in different trades. In Paris, five years is the term required
in a great number; but, before any person can be qualified to exercise
the trade as a master, he must, in many of them, serve five years more
as a journeyman. During this latter term, he is called the companion of
his master, and the term itself is called his companionship.

In Scotland, there is no general law which regulates universally the
duration of apprenticeships. The term is different in different
corporations. Where it is long, a part of it may generally be redeemed
by paying a small fine. In most towns, too, a very small fine is
sufficient to purchase the freedom of any corporation. The weavers of
linen and hempen cloth, the principal manufactures of the country, as
well as all other artificers subservient to them, wheel-makers, reel-
makers, etc. may exercise their trades in any town-corporate without
paying any fine. In all towns-corporate, all persons are free to sell
butchers' meat upon any lawful day of the week. Three years is, in
Scotland, a common term of apprenticeship, even in some very nice
trades; and, in general, I know of no country in Europe, in which
corporation laws are so little oppressive.

The property which every man has in his own labour, as it is the
original foundation of all other property, so it is the most sacred and
inviolable. The patrimony of a poor man lies in the strength and
dexterity of his hands ; and to hinder him from employing this strength
and dexterity in what manner he thinks proper, without injury to his
neighbour. is a plain violation of this most sacred property.     It is
a manifest encroachment upon the just liberty, both of the workman, and
of those who might be disposed to employ him. As it hinders the one from
working at what he thinks proper, so it hinders the others from
employing whom they think proper. To judge whether he is fit to be
employed, may surely be trusted to the discretion of the employers,
whose interest it so much concerns. The affected anxiety of the
lawgiver, lest they should employ an improper person, is evidently as
impertinent as it is oppressive.

The institution of long apprenticeships can give no security that
insufficient workmanship shall not frequently be exposed to public sale.
When this is done, it is generally the effect of fraud, and not of
inability ; and the longest apprenticeship can give no security against
fraud. Quite different regulations are necessary to prevent this abuse.
The sterling mark upon plate, and the stamps upon linen and woollen
cloth, give the purchaser much greater security than any statute of
apprenticeship. He generally looks at these, but never thinks it worth
while to enquire whether the workman had served a seven years
apprenticeship.

The institution of long apprenticeships has no tendency to form young
people to industry. A journeyman who works by the piece is likely to be
industrious, because he derives a benefit from every exertion of his
industry. An apprentice is likely to be idle, and almost always is so,
because he has no immediate interest to be otherwise. In the inferior
employments, the sweets of labour consist altogether in the recompence
of labour. They who are soonest in a condition to enjoy the sweets of
it, are likely soonest to conceive a relish for it, and to acquire the
early habit of industry. A young man naturally conceives an aversion to
labour, when for a long time he receives no benefit from it. The boys
who are put out apprentices from public charities are generally bound
for more than the usual number of years, and they generally turn out
very idle and worthless.

Apprenticeships were altogether unknown to the ancients. The reciprocal
duties of master and apprentice make a considerable article in every
modern code. The Roman law is perfectly silent with regard to them. I
know no Greek or Latin word (I might venture, I believe, to assert that
there is none) which expresses the idea we now annex to the word
apprentice, a servant bound to work at a particular trade for the
benefit of a master, during a term of years, upon condition that the
master shall teach him that trade.

Long apprenticeships are altogether unnecessary. The arts, which are
much superior to common trades, such as those of making clocks and
watches, contain no such mystery as to require a long course of
instruction. The first invention of such beautiful machines, indeed, and
even that of some of the instruments employed in making them, must no
doubt have been the work of deep thought and long time, and may justly
be considered as among the happiest efforts of human ingenuity. But when
both have been fairly invented, and are well understood, to explain to
any young man, in the completest manner, how to apply the instruments,
and how to construct the machines, cannot well require more than the
lessons of a few weeks; perhaps those of a few days might be sufficient.
In the common mechanic trades, those of a few days might certainly be
sufficient. The dexterity of hand, indeed, even in common trades, cannot
be acquired without much practice and experience. But a young man would
practice with much more diligence and attention, if from the beginning
he wrought as a journeyman, being paid in proportion to the little work
which he could execute, and paying in his turn for the materials which
he might sometimes spoil through awkwardness and inexperience. His
education would generally in this way be more effectual, and always less
tedious and expensive. The master, indeed, would be a loser. He would
lose all the wages of the apprentice, which he now saves, for seven
years together. In the end, perhaps, the apprentice himself would he a
loser. In a trade so easily learnt he would have more competitors, and
his wages, when he came to be a complete workman, would be much less
than at present. The same increase of competition would reduce the
profits of the masters, as well as the wages of workmen. The trades, the
crafts, the mysteries, would all be losers. But the public would be a
gainer, the work of all artificers coming in this way much cheaper to
market.

It is to prevent his reduction of price, and consequently of wages and
profit, by restraining that free competition which would most certainly
occasion it, that all corporations, and the greater part of corporation
laws have been established. In order to erect a corporation, no other
authority in ancient times was requisite, in many parts of Europe, but
that of the town-corporate in which it was established.     In England,
indeed, a charter from the king was likewise necessary.     But this
prerogative of the crown seems to have been reserved rather for
extorting money from the subject, than for the defence of the common
liberty against such oppressive monopolies. Upon paying a fine to the
king, the charter seems generally to have been readily granted ; and
when any particular class of artificers or traders thought proper to act
as a corporation, without a charter, such adulterine guilds, as they
were called, were not always disfranchised upon that account, but
obliged to fine annually to the king, for permission to exercise their
usurped privileges {See Madox Firma Burgi p. 26 etc.}. The immediate
inspection of all corporations, and of the bye-laws which they might
think proper to enact for their own government, belonged to the town-
corporate in which they were established; and whatever discipline was
exercised over them, proceeded commonly, not from the king, but from
that greater incorporation of which those subordinate ones were only
parts or members.

The government of towns-corporate was altogether in the hands of traders
and artificers, and it was the manifest interest of every particular
class of them, to prevent the market from being overstocked, as they
commonly express it, with their own particular species of industry;
which is in reality to keep it always understocked. Each class was eager
to establish regulations proper for this purpose, and, provided it was
allowed to do so, was willing to consent that every other class should
do the same. In consequence of such regulations, indeed, each class was
obliged to buy the goods they had occasion for from every other within
the town, somewhat dearer than they otherwise might have done. But, in
recompence, they were enabled to sell their own just as much dearer ; so
that, so far it was as broad as long, as they say ; and in the dealings
of the different classes within the town with one another, none of them
were losers by these regulations.     But in their dealings with the
country they were all great gainers; and in these latter dealings
consist the whole trade which supports and enriches every town.

Every town draws its whole subsistence, and all the materials of its
industry, from the: country. It pays for these chiefly in two ways.
First, by sending back to the country a part of those materials wrought
up and manufactured ; in which case, their price is augmented by the
wages of the workmen, and the profits of their masters or immediate
employers ; secondly, by sending to it a part both of the rude and
manufactured produce, either of other countries, or of distant parts of
the same country, imported into the town; in which case, too, the
original price of those goods is augmented by the wages of the carriers
or sailors, and by the profits of the merchants who employ them. In what
is gained upon the first of those branches of commerce, consists the
advantage which the town makes by its manufactures; in what is gained
upon the second, the advantage of its inland and foreign trade. The
wages of the workmen, and the profits of their different employers, make
up the whole of what is gained upon both. Whatever regulations,
therefore, tend to increase those wages and profits beyond what they
otherwise: would be, tend to enable the town to purchase, with a smaller
quantity of its labour, the produce of a greater quantity of the labour
of the country. They give the traders and artificers in the town an
advantage over the landlords, farmers, and labourers, in the country,
and break down that natural equality which would otherwise take place in
the commerce which is carried on between them. The whole annual produce
of the labour of the society is annually divided between those two
different sets of people. By means of those regulations, a greater share
of it is given to the inhabitants of the town than would otherwise fall
to them, and a less to those of' the country.

The price which the town really pays for the provisions and materials
annually imported into it, is the quantity of manufactures and other
goods annually exported from it. The dearer the latter are sold, the
cheaper the former are bought. The industry of the town becomes more,
and that of the country less advantageous.

That the industry which is carried on in towns is, everywhere in Europe,
more advantageous than that which is carried on in the country, without
entering into any very nice computations, we may satisfy ourselves by
one very simple and obvious observation. In every country of Europe, we
find at least a hundred people who have acquired great fortunes, from
small beginnings, by trade and manufactures, the industry which properly
belongs to towns, for one who has done so by that which properly belongs
to the country, the raising of rude produce by the improvement and
cultivation of land.     Industry, therefore, must be better rewarded,
the wages of labour and the profits of stock must evidently be greater,
in the one situation than in the other. But stock and labour naturally
seek the most advantageous employment. They naturally, therefore, resort
as much as they can to the town, and desert the country.

The inhabitants of a town being collected into one place, can easily
combine together. The most insignificant trades carried on in towns
have, accordingly, in some place or other, been incorporated ; and even
where they have never been incorporated, yet the corporation-spirit, the
jealousy of strangers, the aversion to take apprentices, or to
communicate the secret of their trade, generally prevail in them, and
often teach them, by voluntary associations and agreements, to prevent
that free competition which they cannot prohibit by bye-laws. The trades
which employ but a small number of hands, run most easily into such
combinations. Half-a-dozen wool-combers, perhaps, are necessary to keep
a thousand spinners and weavers at work. By combining not to take
apprentices, they can not only engross the employment, but reduce the
whole manufacture into a sort of slavery to themselves, and raise the
price of their labour much above what is due to the nature of their
work.

The inhabitants of the country, dispersed in distant places, cannot
easily combine together. They have not only never been incorporated, but
the incorporation spirit never has prevailed among them. No
apprenticeship has ever been thought necessary to qualify for husbandry,
the great trade of the country. After what are called the fine arts, and
the liberal professions, however, there is perhaps no trade which
requires so great a variety of knowledge and experience. The innumerable
volumes which have been written upon it in all languages, may satisfy
us, that among the wisest and most learned nations, it has never been
regarded as a matter very easily understood. And from all those volumes
we shall in vain attempt to collect that knowledge of its various and
complicated operations which is commonly possessed even by the common
farmer ; how contemptuously soever the very contemptible authors of some
of them may sometimes affect to speak of him. There is scarce any common
mechanic trade, on the contrary, of which all the operations may not be
as completely and distinctly explained in a pamphlet of a very few
pages, as it is possible for words illustrated by figures to explain
them. In the history of the arts, now publishing by the French Academy
of Sciences, several of them are actually explained in this manner. The
direction of operations, besides, which must be varied with every change
of the weather, as well as with many other accidents, requires much more
judgment and discretion, than that of those which are always the same,
or very nearly the same.

Not only the art of the farmer, the general direction of the operations
of husbandry, but many inferior branches of country labour require much
more skill and experience than the greater part of mechanic trades. The
man who works upon brass and iron, works with instruments, and upon
materials of which the temper is always the same, or very nearly the
same. But the man who ploughs the ground with a team of horses or oxen,
works with instruments of which the health, strength, and temper, are
very different upon different occasions. The condition of the materials
which he works upon, too, is as variable as that of the instruments
which he works with, and both require to be managed with much judgment
and discretion. The common ploughman, though generally regarded as the
pattern of stupidity and ignorance, is seldom defective in this judgment
and discretion. He is less accustomed, indeed, to social intercourse,
than the mechanic who lives in a town. His voice and language are more
uncouth, and more difficult to be understood by those who are not used
to them. His understanding, however, being accustomed to consider a
greater variety of objects, is generally much superior to that of the
other, whose whole attention, from morning till night, is commonly
occupied in performing one or two very simple operations. How much the
lower ranks of people in the country are really superior to those of the
town, is well known to every man whom either business or curiosity has
led to converse much with both. In China and Indostan, accordingly, both
the rank and the wages of country labourers are said to be superior to
those of the greater part of artificers and manufacturers. They would
probably be so everywhere, if corporation laws and the corporation
spirit did not prevent it.

The superiority which the industry of the towns has everywhere in Europe
over that of the country, is not altogether owing to corporations and
corporation laws. It is supported by many other regulations. The high
duties upon foreign manufactures, and upon all goods imported by alien
merchants, all tend to the same purpose. Corporation laws enable the
inhabitants of towns to raise their prices, without fearing to be
undersold by the free competition of their own countrymen. Those other
regulations secure them equally against that of foreigners. The
enhancement of price occasioned by both is everywhere finally paid by
the landlords, farmers, and labourers, of the country, who have seldom
opposed the establishment of such monopolies. They have commonly neither
inclination nor fitness to enter into combinations; and the clamour and
sophistry of merchants and manufacturers easily persuade them, that the
private interest of a part, and of a subordinate part, of the society,
is the general interest of the whole.

In Great Britain, the superiority of the industry of the towns over that
of the country seems to have been greater formerly than in the present
times. The wages of country labour approach nearer to those of
manufacturing labour, and the profits of stock employed in agriculture
to those of trading and manufacturing stock, than they are said to have
none in the last century, or in the beginning of the present. This
change may be regarded as the necessary, though very late consequence of
the extraordinary encouragement given to the industry of the towns. The
stocks accumulated in them come in time to be so great, that it can no
longer be employed with the ancient profit in that species of industry
which is peculiar to them. That industry has its limits like every other
; and the increase of stock, by increasing the competition, necessarily
reduces the profit. The lowering of profit in the town forces out stock
to the country, where, by creating a new demand for country labour, it
necessarily raises its wages. It then spreads itself, if I my say so,
over the face of the land, and, by being employed in agriculture, is in
part restored to the country, at the expense of which, in a great
measure, it had originally been accumulated in the town. That everywhere
in Europe the greatest improvements of the country have been owing to
such over flowings of the stock originally accumulated in the towns, I
shall endeavour to shew hereafter, and at the same time to demonstrate,
that though some countries have, by this course, attained to a
considerable degree of opulence, it is in itself necessarily slow,
uncertain, liable to be disturbed and interrupted by innumerable
accidents, and, in every respect, contrary to the order of nature and of
reason The interests, prejudices, laws, and customs, which have given
occasion to it, I shall endeavour to explain as fully and distinctly as
I can in the third and fourth books of this Inquiry.

People of the same trade seldom meet together, even for merriment and
diversion, but the conversation ends in a conspiracy against the public,
or in some contrivance to raise prices. It is impossible, indeed, to
prevent such meetings, by any law which either could be executed, or
would be consistent with liberty and justice. But though the law cannot
hinder people of the same trade from sometimes assembling together, it
ought to do nothing to facilitate such assemblies, much less to render
them necessary.

A regulation which obliges all those of the same trade in a particular
town to enter their names and places of abode in a public register,
facilitates such assemblies. It connects individuals who might never
otherwise be known to one another, and gives every man of the trade a
direction where to find every other man of it.

A regulation which enables those of the same trade to tax themselves, in
order to provide for their poor, their sick, their widows and orphans,
by giving them a common interest to manage, renders such assemblies
necessary.

An incorporation not only renders them necessary, but makes the act of
the majority binding upon the whole. In a free trade, an effectual
combination cannot be established but by the unanimous consent of every
single trader, and it cannot last longer than every single trader
continues of the same mind. The majority of a corporation can enact a
bye-law, with proper penalties, which will limit the competition more
effectually and more durably than any voluntary combination what. ever.

The pretence that corporations are necessary for the better government
of the trade, is without any foundation. The real and effectual
discipline which is exercised over a workman, is not that of his
corporation, but that of his customers. It is the fear of losing their
employment which restrains his frauds and corrects his negligence. An
exclusive corporation necessarily weakens the force of this discipline.
A particular set of workmen must then be employed, let them behave well
or ill. It is upon this account that, in many large incorporated towns,
no tolerable workmen are to be found, even in some of the most necessary
trades. If you would have your work tolerably executed, it must be done
in the suburbs, where the workmen, having no exclusive privilege, have
nothing but their character to depend upon, and you must then smuggle it
into the town as well as you can.

It is in this manner that the policy of Europe, by restraining the
competition in some employments to a smaller number than would otherwise
be disposed to enter into them, occasions a very important inequality in
the whole of the advantages and disadvantages of the different
employments of labour and stock.

Secondly, The policy of Europe, by increasing the competition in some
employments beyond what it naturally would be, occasions another
inequality, of an opposite kind, in the whole of the advantages and
disadvantages of the different employments of labour and stock.

It has been considered as of so much importance that a proper number of
young people should be educated for certain professions, that sometimes
the public, and sometimes the piety of private founders, have
established many pensions, scholarships, exhibitions, bursaries, etc.
for this purpose, which draw many more people into those trades than
could otherwise pretend to follow them. In all Christian countries, I
believe, the education of the greater part of churchmen is paid for in
this manner. Very few of them are educated altogether at their own
expense. The long, tedious, and expensive education, therefore, of those
who are, will not always procure them a suitable reward, the church
being crowded with people, who, in order to get employment, are willing
to accept of a much smaller recompence than what such an education would
otherwise have entitled them to ; and in this manner the competition of
the poor takes away the reward of the rich. It would be indecent, no
doubt, to compare either a curate or a chaplain with a journeyman in any
common trade. The pay of a curate or chaplain, however, may very
properly be considered as of the same nature with the wages of a
journeyman. They are all three paid for their work according to the
contract which they may happen to make with their respective superiors.
Till after the middle of the fourteenth century, five merks, containing
about as much silver as ten pounds of our present money, was in England
the usual pay of a curate or a stipendiary parish priest, as we find it
regulated by the decrees of several different national councils. At the
same period, fourpence a-day, containing the same quantity of silver as
a shilling of our present money, was declared to be the pay of a master
mason; and threepence a-day, equal to ninepence of our present money,
that of a journeyman mason. {See the Statute of Labourers, 25, Ed. III.}
The wages of both these labourer's, therefore, supposing them to have
been constantly employed, were much superior to those of the curate. The
wages of the master mason, supposing him to have been without employment
one-third of the year, would have fully equalled them. By the 12th of
Queen Anne, c. 12. it is declared, "That whereas, for want of sufficient
maintenance and encouragement to curates, the cures have, in several
places, been meanly supplied, the bishop is, therefore, empowered to
appoint, by writing under his hand and seal, a sufficient certain
stipend or allowance, not exceeding fifty, and not less than twenty
pounds a-year". Forty pounds a-year is reckoned at present very good pay
for a curate; and, notwithstanding this act of parliament, there are
many curacies under twenty pounds a-year. There are journeymen
shoemakers in London who earn forty pounds a-year, and there is scarce
an industrious workman of any kind in that metropolis who does not earn
more than twenty. This last sum, indeed, does not exceed what frequently
earned by common labourers in many country parishes. Whenever the law
has attempted to regulate the wages of workmen, it has always been
rather to lower them than to raise them. But the law has, upon many
occasions, attempted to raise the wages of curates, and, for the dignity
of the church, to oblige the rectors of parishes to give them more than
the wretched maintenance which they themselves might be willing to
accept of. And, in both cases, the law seems to have been equally
ineffectual, and has never either been able to raise the wages of
curates, or to sink those of labourers to the degree that was intended;
because it has never been able to hinder either the one from being
willing to accept of less than the legal allowance, on account of the
indigence of their situation and the multitude of their competitors, or
the other from receiving more, on account of the contrary competition of
those who expected to derive either profit or pleasure from employing
them.

The great benefices and other ecclesiastical dignities support the
honour of the church. notwithstanding the mean circumstances of some of
its inferior members. The respect paid to the profession, too, makes
some compensation even to them for the meanness of their pecuniary
recompence. In England, and in all Roman catholic countries, the lottery
of the church is in reality much more advantageous than is necessary.
The example of the churches of Scotland, of Geneva, and of several other
protestant churches, may satisfy us, that in so creditable a profession,
in which education is so easily procured, the hopes of much more
moderate benefices will draw a sufficient number of learned, decent, and
respectable men into holy orders.

In professions in which there are no benefices, such as law and physic,
if an equal proportion of people were educated at the public expense,
the competition would soon be so great as to sink very much their
pecuniary reward. It might then not be worth any man's while to educate
his son to either of those professions at his own expense. They would be
entirely abandoned to such as had been educated by those public
charities, whose numbers and necessities would oblige them in general to
content themselves with a very miserable recompence, to the entire
degradation of the now respectable professions of law and physic.

That unprosperous race of men, commonly called men of letters, are
pretty much in the situation which lawyers and physicians probably would
be in, upon the foregoing supposition. In every part of Europe, the
greater part of them have been educated for the church, but have been
hindered by different reasons from entering into holy orders. They have
generally, therefore, been educated at the public expense; and their
numbers are everywhere so great, as commonly to reduce the price of
their labour to a very paltry recompence.

Before the invention of the art of printing, the only employment by
which a man of letters could make any thing by his talents, was that of
a public or private teacher, or by communicating to other people the
curious and useful knowledge which he had acquired himself ; and this is
still surely a more honourable, a more useful, and, in general, even a
more profitable employment than that other of writing for a bookseller,
to which the art of printing has given occasion. The time and study, the
genius, knowledge, and application requisite to qualify an eminent
teacher of the sciences, are at least equal to what is necessary for the
greatest practitioners in law and physic. But the usual reward of the
eminent teacher bears no proportion to that of the lawyer or physician,
because the trade of the one is crowded with indigent people, who have
been brought up to it at the public expense ; whereas those of the other
two are encumbered with very few who have not been educated at their
own. The usual recompence, however, of public and private teachers,
small as it may appear, would undoubtedly be less than it is, if the
competition of those yet more indigent men of letters, who write for
bread, was not taken out of the market. Before the invention of the art
of printing, a scholar and a beggar seem to have been terms very nearly
synonymous. The different governors of the universities, before that
time, appear to have often granted licences to their scholars to beg.

In ancient times, before any charities of this kind had been established
for the education of indigent people to the learned professions, the
rewards of eminent teachers appear to have been much more considerable.
Isocrates, in what is called his discourse against the sophists.
reproaches the teachers of his own times with inconsistency. 'They make
the most magnificent promises to their scholars," says he, " and
undertake to teach them to be wise, to be happy, and to be just; and, in
return for so important a service, they stipulate the paltry reward of
four or five minae." "They who teach wisdom," continues he, "ought
certainly to be wise themselves ; but if any man were to sell such a
bargain for such a price, he would be convicted of the most evident
folly." He certainly does not mean here to exaggerate the reward, and we
may be assured that it was not less than he represents it. Four minae
were equal to thirteen pounds six shillings and eightpence ; five minae
to sixteen pounds thirteen shillings and fourpence.Something not less
than the largest of those two sums, therefore, must at that time have
been usually paid to the most eminent teachers at Athens. Isocrates
himself demanded ten minae, or £ 33:6:8 from each scholar. When he
taught at Athens, he is said to have had a hundred scholars. I
understand this to be the number whom he taught at one time, or who
attended what we would call one course of lectures ; a number which will
not appear extraordinary from so great a city to so famous a teacher,
who taught, too, what was at that time the most fashionable of all
sciences, rhetoric. He must have made, therefore, by each course of
lectures, a thousand minae, or £ 3335:6:8. A thousand minae,
accordingly, is said by Plutarch, in another place, to have been his
didactron, or usual price of teaching. Many other eminent teachers in
those times appear to have acquired great fortunes. Georgias made a
present to the temple of Delphi of his own statue in solid gold. We must
not, I presume, suppose that it was as large as the life. His way of
living, as well as that of Hippias and Protagoras, two other eminent
teachers of those times, is represented by Plato as splendid, even to
ostentation. Plato himself is said to have lived with a good deal of
magnificence. Aristotle, after having been tutor to Alexander, and most
munificently rewarded, as it is universally agreed, both by him and his
father, Philip, thought it worth while, notwithstanding, to return to
Athens, in order to resume the teaching of his school. Teachers of the
sciences were probably in those times less common than they came to be
in an age or two afterwards, when the competition had probably somewhat
reduced both the price of their labour and the admiration for their
persons. The most eminent of them, however, appear always to have
enjoyed a degree of consideration much superior to any of the like
profession in the present times. The Athenians sent Carneades the
academic, and Diogenes the stoic, upon a solemn embassy to Rome; and
though their city had then declined from its former grandeur, it was
still an independent and considerable republic.

Carneades, too, was a Babylonian by birth; and as there never was a
people more jealous of admitting foreigners to public offices than the
Athenians, their consideration for him must have been very great.

This inequality is, upon the whole, perhaps rather advantageous than
hurtful to the public. It may somewhat degrade the profession of a
public teacher ; but the cheapness of literary education is surely an
advantage which greatly overbalances this trifling inconveniency. The
public, too, might derive still greater benefit from it, if the
constitution of those schools and colleges, in which education is
carried on, was more reasonable than it is at present through the
greater part of Europe.

Thirdly, the policy of Europe, by obstructing the free circulation of
labour and stock, both from employment to employment, and from place to
place, occasions, in some cases, a very inconvenient inequality in the
whole of the advantages and disadvantages of their different
employments.

The statute of apprenticeship obstructs the free circulation of labour
from one employment to another, even in the same place. The exclusive
privileges of corporations obstruct it from one place to another, even
in the same employment.

It frequently happens, that while high wages are given to the workmen in
one manufacture, those in another are obliged to content themselves with
bare subsistence. The one is in an advancing state, and has therefore a
continual demand for new hands ; the other is in a declining state, and
the superabundance of hands is continually increasing. Those two
manufactures may sometimes be in the same town, and sometimes in the
same neighbourhood, without being able to lend the least assistance to
one another. The statute of apprenticeship may oppose it in the one
case, and both that and an exclusive corporation in the other. In many
different manufactures, however, the operations are so much alike, that
the workmen could easily change trades with one another, if those absurd
laws did not hinder them. The arts of weaving plain linen and plain
silk, for example, are almost entirely the same. That of weaving plain
woollen is somewhat different ; but the difference is so insignificant,
that either a linen or a silk weaver might become a tolerable workman in
a very few days. If any of those three capital manufactures, therefore,
were decaying, the workmen might find a resource in one of the other two
which was in a more prosperous condition; and their wages would neither
rise too high in the thriving, nor sink too low in the decaying
manufacture. The linen manufacture, indeed, is in England, by a
particular statute, open to every body ; but as it is not much
cultivated through the greater part of the country, it can afford no
general resource to the work men of other decaying manufactures, who,
wherever the statute of apprenticeship takes place, have no other
choice, but dither to come upon the parish, or to work as common
labourers ; for which, by their habits, they are much worse qualified
than for any sort of manufacture that bears any resemblance to their
own. They generally, therefore, chuse to come upon the parish.

Whatever obstructs the free circulation of labour from one employment to
another, obstructs that of stock likewise; the quantity of stock which
can be employed in any branch of business depending very much upon that
of the labour which can be employed in it. Corporation laws, however,
give less obstruction to the free circulation of stock from one place to
another, than to that of labour. It is everywhere much easier for a
wealthy merchant to obtain the privilege of trading in a town-corporate,
than for a poor artificer to obtain that of working in it.

The obstruction which corporation laws give to the free circulation of
labour is common, I believe, to every part of Europe. That which is
given to it by the poor laws is, so far as I know, peculiar to England.
It consists in the difficulty which a poor man finds in obtaining a
settlement, or even in being allowed to exercise his industry in any
parish but that to which he belongs. It is the labour of artificers and
manufacturers only of which the free circulation is obstructed by
corporation laws. The difficulty of obtaining settlements obstructs even
that of common labour. It may be worth while to give some account of the
rise, progress, and present state of this disorder, the greatest,
perhaps, of any in the police of England.

When, by the destruction of monasteries, the poor had been deprived of
the charity of those religious houses, after some other ineffectual
attempts for their relief, it was enacted, by the 43d of Elizabeth, c.
2. that every parish should be bound to provide for its own poor, and
that overseers of the poor should be annually appointed, who, with the
church-wardens, should raise, by a parish rate, competent sums for this
purpose.

By this statute, the necessity of providing for their own poor was
indispensably imposed upon every parish. Who were to be considered as
the poor of each parish became, therefore, a question of some
importance. This question, after some variation, was at last determined
by the 13th and 14th of Charles II. when it was enacted, that forty days
undisturbed residence should gain any person a settlement in any parish;
but that within that time it should be lawful for two justices of the
peace, upon complaint made by the church-wardens or overseers of the
poor, to remove any new inhabitant to the parish where he was last
legally settled ; unless he either rented a tenement of ten pounds a-
year, or could give such security for the discharge of the parish where
he was then living, as those justices should judge sufficient.

Some frauds, it is said, were committed in consequence of this statute;
parish officers sometime's bribing their own poor to go clandestinely to
another parish, and, by keeping themselves concealed for forty days, to
gain a settlement there, to the discharge of that to which they properly
belonged. It was enacted, therefore, by the 1st of James II. that the
forty days undisturbed residence of any person necessary to gain a
settlement, should be accounted only from the time of his delivering
notice, in writing, of the place of his abode and the number of his
family, to one of the church-wardens or overseers of the parish where he
came to dwell.

But parish officers, it seems, were not always more honest with regard
to their own than they had been with regard to other parishes, and
sometimes connived at such intrusions, receiving the notice, and taking
no proper steps in consequence of it. As every person in a parish,
therefore, was supposed to have an interest to prevent as much as
possible their being burdened by such intruders, it was further enacted
by the 3rd of William III. that the forty days residence should be
accounted only from the publication of such notice in writing on Sunday
in the church, immediately after divine service.

" After all," says Doctor Burn, "this kind of settlement, by continuing
forty days after publication of notice in writing, is very seldom
obtained ; and the design of the acts is not so much for gaining of
settlements, as for the avoiding of them by persons coming into a parish
clandestinely, for the giving of notice is only putting a force upon the
parish to remove. But if a person's situation is such, that it is
doubtful whether he is actually removable or not, he shall, by giving of
notice, compel the parish either to allow him a settlement uncontested,
by suffering him to continue forty days, or by removing him to try the
right."

This statute, therefore, rendered it almost impracticable for a poor man
to gain a new settlement in the old way, by forty days inhabitancy. But
that it might not appear to preclude altogether the common people of
one' parish from ever establishing themselves with security in another,
it appointed four other ways by which a settlement might be gained
without any notice delivered or published. The first was, by being taxed
to parish rates and paying them; the second, by being elected into an
annual parish office, and serving in it a year ; the third, by serving
an apprenticeship in the parish ; the fourth, by being hired into
service there for a year, and continuing in the same service during the
whole of it. Nobody can gain a settlement by either of the two first
ways, but by the public deed of the whole parish, who are too well aware
of the consequences to adopt any new-comer, who has nothing but his
labour to support him, either by taxing him to parish rates, or by
electing him into a parish office.

No married man can well gain any settlement in either of the two last
ways. An apprentice is scarce ever married ; and it is expressly
enacted, that no married servant shall gain any settlement by being
hired for a year. The principal effect of introducing settlement by
service, has been to put out in a great measure the old fashion of
hiring for a year; which before had been so customary in England, that
even at this day, if no particular term is agreed upon, the law intends
that every servant is hired for a year. But masters are not always
willing to give their servants a settlement by hiring them in this
manner ; and servants are not always willing to be so hired, because, as
every last settlement discharges all the foregoing, they might thereby
lose their original settlement in the places of their nativity, the
habitation of their parents and relations.

No independent workman, it is evident, whether labourer or artificer, is
likely to gain any new settlement, either by apprenticeship or by
service. When such a person, therefore, carried his industry to a new
parish, he was liable to be removed, how healthy and industrious soever,
at the caprice of any churchwarden or overseer, unless he either rented
a tenement of ten pounds a-year, a thing impossible for one who has
nothing but his labour to live by, or could give such security for the
discharge of the parish as two justices of the peace should judge
sufficient.

What security they shall require, indeed, is left altogether to their
discretion; but they cannot well require less than thirty pounds, it
having been enacted, that the purchase even of a freehold estate of less
than thirty pounds value, shall not gain any person a settlement, as not
being sufficient for the discharge of the parish. But this is a security
which scarce any man who lives by labour can give; and much greater
security is frequently demanded.

In order to restore, in some measure, that free circulation of labour
which those different statutes had almost entirely taken away, the
invention of certificates was fallen upon. By the 8th and 9th of William
III. it was enacted that if any person should bring a certificate from
the parish where he was last legally settled, subscribed by the church-
wardens and overseers of the poor, and allowed by two justices of the
peace, that every other parish should be obliged to receive him; that he
should not be removable merely upon account of his being likely to
become chargeable, but only upon his becoming actually chargeable ; and
that then the parish which granted the certificate should be obliged to
pay the expense both of his maintenance and of his removal. And in order
to give the most perfect security to the parish where such certificated
man should come to reside, it was further enacted by the same statute,
that he should gain no settlement there by any means whatever, except
either by renting a tenement of ten pounds a-year, or by serving upon
his own account in an annual parish office for one whole year ; and
consequently neither by notice nor by service, nor by apprenticeship,
nor by paying parish rates. By the 12th of Queen Anne, too, stat. 1,
c.18, it was further enacted, that neither the servants nor apprentices
of such certificated man should gain any settlement in the parish where
he resided under such certificate.

How far this invention has restored that free circulation of labour,
which the preceding statutes had almost entirely taken away, we may
learn from the following very judicious observation of Doctor Burn. "It
is obvious," says he, " that there are divers good reasons for requiring
certificates with persons coming to settle in any place; namely, that
persons residing under them can gain no settlement, neither by
apprenticeship, nor by service, nor by giving notice, nor by paying
parish rates; that they can settle neither apprentices nor servants ;
that if they become chargeable, it is certainly known whither to remove
them, and the parish shall be paid for the removal, and for their
maintenance in the mean time ; and that, if they fall sick, and cannot
be removed, the parish which gave the certificate must maintain them ;
none of all which can be without a certificate. Which reasons will hold
proportionably for parishes not granting certificates in ordinary cases;
for it is far more than an equal chance, but that they will have the
certificated persons again, and in a worse condition." The moral of this
observation seems to be, that certificates ought always to be required
by the parish where any poor man comes to reside, and that they ought
very seldom to be granted by that which he purposes to leave. " There is
somewhat of hardship in this matter of certificates," says the same very
intelligent author, in his History of the Poor Laws, "by putting it in
the power of a parish officer to imprison a man as it were for life,
however inconvenient it may be for him to continue at that place where
he has had the misfortune to acquire what is called a settlement, or
whatever advantage he may propose himself by living elsewhere."

Though a certificate carries along with it no testimonial of good
behaviour, and certifies nothing but that the person belongs to the
parish to which he really does belong, it is altogether discretionary in
the parish officers either to grant or to refuse it. A mandamus was once
moved for, says Doctor Burn, to compel the church-wardens and overseers
to sign a certificate; but the Court of King's Bench rejected the motion
as a very strange attempt.

The very unequal price of labour which we frequently find in England, in
places at no great distance from one another, is probably owing to the
obstruction which the law of settlements gives to a poor man who would
carry his industry from one parish to another without a certificate. A
single man, indeed who is healthy and industrious, may sometimes reside
by sufferance without one ; but a man with a wife and family who should
attempt to do so, would, in most parishes, be sure of being removed ;
and, if the single man should afterwards marry, he would generally be
removed likewise. The scarcity of hands in one parish, therefore, cannot
always be relieved by their superabundance in another, as it is
constantly in Scotland, and. I believe, in all other countries where
there is no difficulty of settlement.    In such countries, though wages
may sometimes rise a little in the neighbourhood of a great town, or
wherever else there is an extraordinary demand for labour, and sink
gradually as the distance from such places increases, till they fall
back to the common rate of the country ; yet we never meet with those
sudden and unaccountable differences in the wages of neighbouring places
which we sometimes find in England, where it is often more difficult for
a poor man to pass the artificial boundary of a parish, than an arm of
the sea, or a ridge of high mountains, natural boundaries which
sometimes separate very distinctly different rates of wages in other
countries.

To remove a man who has committed no misdemeanour, from the parish where
he chooses to reside, is an evident violation of natural liberty and
justice. The common people of England, however, so jealous of their
liberty, but like the common people of most other countries, never
rightly understanding wherein it consists, have now, for more than a
century together, suffered themselves to be exposed to this oppression
without a remedy. Though men of reflection, too, have some. times
complained of the law of settlements as a public grievance ; yet it has
never been the object of any general popular clamour, such as that
against general warrants, an abusive practice undoubtedly, but such a
one as was not likely to occasion any general oppression. There is
scarce a poor man in England, of forty years of age, 1 will venture to
say, who has not, in some part of his life, felt himself most cruelly
oppressed by this ill-contrived law of settlements.

I shall conclude this long chapter with observing, that though anciently
it was usual to rate wages, first by general laws extending over the
whole kingdom, and afterwards by particular orders of the justices of
peace in every particular county, both these practices have now gone
entirely into disuse " By the experience of above four hundred years,"
says Doctor Burn, " it seems time to lay aside all endeavours to bring
under strict regulations, what in its own nature seems incapable of
minute limitation ; for if all persons in the same kind of work were to
receive equal wages, there would be no emulation, and no room left for
industry or ingenuity."

Particular acts of parliament, however, still attempt sometimes to
regulate wages in particular trades, and in particular places. Thus the
8th of George III. prohibits, under heavy penalties, all master tailors
in London, and five miles round it, from giving, and their workmen from
accepting, more than two shillings and sevenpence halfpenny a-day,
except in the case of a general mourning. Whenever the legislature
attempts to regulate the differences between masters and their workmen,
its counsellors are always the masters. When the regulation, therefore,
is in favour of the workmen, it is always just and equitable; but it is
sometimes otherwise when in favour of the masters. Thus the law which
obliges the masters in several different trades to pay their workmen in
money, and not in goods, is quite just and equitable. It imposes no real
hardship upon the masters. It only obliges them to pay that value in
money, which they pretended to pay, but did not always really pay, in
goods. This law is in favour of the workmen; but the 8th of George III.
is in favour of the masters. When masters combine together, in order to
reduce the wages of their workmen, they commonly enter into a private
bond or agreement, not to give more than a certain wage, under a certain
penalty. Were the workmen to enter into a contrary combination of the
same kind, not to accept of a certain wage, under a certain penalty, the
law would punish them very severely; and, if it dealt impartially, it
would treat the masters in the same manner. But the 8th of George III.
enforces by law that very regulation which masters sometimes attempt to
establish by such combinations. The complaint of the workmen, that it
puts the ablest and most industrious upon the same footing with an
ordinary workman, seems perfectly well founded.

In ancient times, too, it was usual to attempt to regulate the profits
of merchants and other dealers, by regulating the price of provisions
and ether goods. The assize of bread is, so far as I know, the only
remnant of this ancient usage. Where there is an exclusive corporation,
it may, perhaps, be proper to regulate the price of the first necessary
of life ; but, where there is none, the competition will regulate it
much better than any assize. The method of fixing the assize of bread,
established by the 31st of George II. could not be put in practice in
Scotland, on account of a defect in the law, its execution depending
upon the office of clerk of the market, which does not exist there. This
defect was not remedied till the third of George III. The want of an
assize occasioned no sensible inconveniency; and the establishment of
one in the few places where it has yet taken place has produced no
sensible advantage. In the greater part of the towns in Scotland,
however, there is an incorporation of bakers, who claim exclusive
privileges, though they are not very strictly guarded. The proportion
between the different rates, both of wages and profit, in the different
employments of labour and stock, seems not to be much affected, as has
already been observed, by the riches or poverty, the advancing,
stationary, or declining state of the society. Such revolutions in the
public welfare, though they affect the general rates both of wages and
profit, must, in the end, affect them equally in all different
employments. The proportion between them, therefore, must remain the
same, and cannot well be altered, at least for any considerable time, by
any such revolutions.