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consistently with affording to the capital employed the ordinary rate of profit.

"As, however, differences of fertility slide into one another by insensible gradations; and differences of accessibility, that is of distance from market, do the same; and since there is land so barren that it could not pay for its cultivation at any price; it is evident that whatever the price may be, there must in any extensive region be some land which at that price will just pay the wages of the cultivators, and yield to the capital employed the ordinary profit, and no more. Until therefore the price rises higher, or until some improvement raises that particular land to a higher place in the scale of fertility, it can not pay any rent.” Now this no doubt is true, but unfortunately it is exactly contrary to the theory of Ricardo in his chapter on Rent, which Mill declares to be the pons asinorum of Political Economy!

23. We have thus shewn that Mill contradicts himself on the very definition of Rent, and that Ricardo's theory, which he so much extols, does not account for the existence of Rent, but only for the differences in its amount. And it needs no ghost to tell us that lands which possess superior advantages of fertility and situation will pay a higher rent than inferior lands; and this is all that Ricardo's theory of Rent really amounts to.

But Ricardo is contradictory to himself. In his chapter on Rent he most clearly makes the price of corn to depend on the cost of producing the worst portion of it: and that it is bringing inferior lands into cultivation which raises the price of corn, and enables Rents to be paid on the superior lands.

But in combatting Malthus he says precisely the reverse1" It is the rise in the market price of corn which alone encourages its production; for it may be laid down as a principle uniformly true, that the only great encouragement to the increased production of a commodity is its market value exceeding its natural or necessary value." This doctrine is manifestly contradictory to his other theory.

In fact, as soon as it is admitted that all lands and mines can pay Rent, Ricardo's Theory, as well as all Theories of Rent that make differences of advantage as essential to the payment of Rent, vanish into air. For they wholly fail to account for the Rent of 1 Principles of Political Economy, ch. 32.

the worst portion. But when we adopt the General Law of Value, or the General Equation of Economics we have obtained, the whole subject becomes clear and harmonious. The Value of the product is determined, like as in all other cases, exclusively by the General Law of Supply and Demand; and if the Value is sufficiently high, all lands and mines may pay rent; and whether or not there are differences of advantage in various lands or mines, or not, is a mere accident, quite independent of the General Theory.

Ricardo has also contradicted himself on the only really important point in his theory. In his former chapter he maintains that the payment of Rent does not affect the general price of corn: that the cost of producing the worst portion regulates the price of the whole that if the landlords did not receive their rents the farmers would; and that, therefore, the division of the profits between landlords and farmers in no way affects the consumer, but if the landlords gave up their rents they would simply go into the pockets of the farmers.

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But in the chapter combatting Malthus he says that he agrees with Sismondi and Buchanan in saying that "rent is a value purely nominal, and as forming no addition to the national wealth, but merely as a transfer of value, advantageous only to the landlords, and proportionably injurious to the consumer."

Now, here he says that rent is injurious to the consumer; the meaning of which is that it increases the price of corn, and that if landlords gave up their rents corn would be so much the cheaper; a doctrine which is a most plain and striking contradiction to his other theory, and which we have shewn to be untrue.

24. Now, this is not mere logomachy. It is a fundamental difference between two distinct systems of Economics. We have shewn that Smith and Ricardo are contradictory to themselves on the very fundamental conceptions of Wealth and Value.

What can be more contradictory and absurd than for Smith to assert1"Labour, therefore, it appears evidently is the only universal, as well as the only accurate, measure of value, or the only standard by which we can compare the values of different commodities at all times and all places"-and then to say that there are products of the earth which have a value far beyond any labour that was ever bestowed on them-then afterwards to assert that

1 Wealth of Nations, B. I., ch. 5.

unless they are exchangeable they have no value at all, whatever labour may have been bestowed on them—and then to admit that Bank Notes have the value of money, when no labour is bestowed on them?

If labour is the sole measure of all value at all times and all places, how can Money and Bank Notes be of exactly equal value, when the one is due entirely to labour, and the other is not in any way due to labour?

What can be more contradictory and absurd than for Ricardo in one place to assert that it is the labour of producing the worst portion of corn that regulates the price of the whole quantity of corn, and that the payment of rent in no way affects the consumer, -and in another place to say that it is the increased price of corn which enables worse portions of corn to be produced, and that the payment of rent is injurious to the consumer?

If, as Ricardo says, the theory of the Rent of Mines is exactly the same as the theory of the Rent of Land, and if, as he says, Rent only proceeds from decaying fertility, and the application of equal portions of capital with decreasing returns-how could it be possible that a single mine or quarry in which there are no differences of returns should be capable of yielding a Rent? It is surprising that the absurdity of this doctrine, which is the logical consequence of this theory of Rent, did not strike Ricardo and Mill, and shew them the entire fallacy of the whole theory.

25. We have seen that Smith, Ricardo and Mill are entirely contradictory to themselves in the very fundamental conceptions of the Science. In some parts of their works they make labour to be the essence of all wealth, and of all value, and they refuse to consider as wealth anything except material things produced by labour; and they consider the Value of a thing to be simply the labour embodied in it.

But in other parts of their works they admit that it is precisely the contrary. They see that Value proceeds from Demand, and that it is not Labour which is the Cause of Value, but Value which is the Inducement to Labour. We have shewn that all ancient writers unanimously agree that the essence of wealth consists in Exchangeability exclusively, a doctrine which even those writers who have dwelt so much on Labour are constrained to admit.

Now, when we adopt exchangeability as the fundamental con

ception of wealth it makes the Science immensely more extensive than the conception which bases it on Labour and Materiality. For there are innumerable things, even material, which are exchangeable, and which are not the produce of labour. It is this fundamental idea which renders the Theory of Credit intelligible; which consists in the exchange, or commerce, of Debts, valuable property, which are bought and sold, though they are neither material nor the produce of labour.

Thus when Wealth and Value are relieved from the shackles of Labour and Materiality, and based on the single idea of Exchangeability, Economics becomes for the first time a General Science, with a strictly defined purpose and limit. The phenomena of Value may be erected into a great Inductive Science based upon fundamental General Conceptions and governed by General Laws, precisely in the same manner as the phenomena of any of the other great Inductive Sciences, such as those of Force and Light, by simply following analogous methods to those by which the Laws of Mechanics and Optics have been demonstrated.

We have shewn by abundant extracts in the beginning of this work that Bacon was the first to proclaim emphatically the great doctrine of the essential continuity of science: and among many others Herschel says "that natural philosophy is essentially united in all its departments, through all which one spirit reigns, and one method of inquiry applies." Many Economists have acknowledged the same doctrine, and especially Mill, who in one place says that Economics is a physical science, and can only be brought to perfection by adopting the methods already adopted in physical science duly extended and generalised. Now, is the system of breaking up the phenomena of Economics into separate classes, and assigning a distinct Theory of Value for each case, in accordance with the method adopted in any physical science? There is no person whatever conversant with the most elementary principles of any Physical Science who would not at once say that this method, commenced by Ricardo and extended by Mill, is utterly repugnant to the fundamental principles of Natural Philosophy, and those who believe in such a system should at once restore the Mechanics of Aristotle, and the Astronomy of Ptolemy.

But we entirely repudiate and reject such a method of procedure. We have shewn that Economics is the Science of Value, or Commerce, in its widest extent; and that it may be erected into

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a great general science, based upon fundamental general ideas, and governed by general laws precisely in the same way as Mechanics or Optics. It affords a splendid example of demonstrative Inductive reasoning, leading to results of as great certainty, though not the same precision, as any of the Physical Sciences. By adopting the same general principles of reasoning as are universally employed in every other Physical Science, and an exposition of the facts of Economics, we have annihilated those false distinctions set up by Ricardo and Mill, and reduced all the phenomena to a single General Equation, or Law. We shall have in a future chapter to examine the further application of this General Law, and shew its important consequences in the progress of society.

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