An Inquiry into the Nature and Causes of the Wealth of Nations, Adam Smith [e book reader pdf TXT] 📗
- Author: Adam Smith
- Performer: 0226763749
Book online «An Inquiry into the Nature and Causes of the Wealth of Nations, Adam Smith [e book reader pdf TXT] 📗». Author Adam Smith
to market, therefore, may be disposed of to those who are willing to give
more than what is sufficient to pay the rent of the land which produced
them, together with the wages of the labour and the profits of the stock
which were employed in preparing and bringing them to market, according to
their natural rates. Such commodities may continue for whole centuries
together to be sold at this high price ; and that part of it which resolves
itself into the rent of land, is in this case the part which is generally
paid above its natural rate. The rent of the land which affords such
singular and esteemed productions, like the rent of some vineyards in France
of a peculiarly happy soil and situation, bears no regular proportion to the
rent of other equally fertile and equally well cultivated land in its
neighbourhood. The wages of the labour, and the profits of the stock
employed in bringing such commodities to market, on the contrary, are seldom
out of their natural proportion to those of the other employments of labour
and stock in their neighbourhood.
Such enhancements of the market price are evidently the effect of natural
causes, which may hinder the effectual demand from ever being fully
supplied, and which may continue, therefore, to operate for ever.
A monopoly granted either to an individual or to a trading company, has the
same effect as a secret in trade or manufactures. The monopolists, by
keeping the market constantly understocked by never fully supplying the
effectual demand, sell their commodities much above the natural price, and
raise their emoluments. whether they consist in wages or profit, greatly
above their natural rate.
The price of monopoly is upon every occasion the highest which can be got.
The natural price, or the price of free competition, on the contrary, is the
lowest which can be taken, not upon every occasion indeed, but for any
considerable time together. The one is upon every occasion the highest which
can be squeezed out of the buyers, or which it is supposed they will
consent to give; the other is the lowest which the sellers can commonly
afford to take, and at the same time continue their business.
The exclusive privileges of corporations, statutes of apprenticeship, and
all those laws which restrain in particular employments, the competition to
a smaller number than might otherwise go into them, have the same tendency,
though in a less degree. They are a sort of enlarged monopolies, and may
frequently, for ages together, and in whole classes of employments, keep up
the market price of particular commodities above the natural price, and
maintain both the wages of the labour and the profits of the stock employed
about them somewhat above their natural rate.
Such enhancements of the market price may last as long as the regulations of
policy which give occasion to them.
The market price of any particular commodity, though it may continue long
above, can seldom continue long below, its natural price. Whatever part of
it was paid below the natural rate, the persons whose interest it affected
would immediately feel the loss, and would immediately withdraw either so
much land or no much labour, or so much stock, from being employed about it,
that the quantity brought to market would soon be no more than sufficient to
supply the effectual demand. Its market price, therefore, would soon rise to
the natural price; this at least would be the case where there was perfect
liberty.
The same statutes of apprenticeship and other corporation laws, indeed,
which, when a manufacture is in prosperity, enable the workman to raise his
wages a good deal above their natural rate, sometimes oblige him, when it
decays, to let them down a good deal below it. As in the one case they
exclude many people from his employment, so in the other they exclude him
from many employments. The effect of such regulations, however, is not near
so durable in sinking the workman’s wages below, as in raising them above
their natural rate. Their operation in the one way may endure for many
centuries, but in the other it can last no longer than the lives of some of
the workmen who were bred to the business in the time of its prosperity.
When they are gone, the number of those who are afterwards educated to the
trade will naturally suit itself to the effectual demand. The policy must be
as violent as that of Indostan or ancient Egypt (where every man was bound
by a principle of religion to follow the occupation of his father, and was
supposed to commit the most horrid sacrilege if he changed it for another),
which can in any particular employment, and for several generations
together, sink either the wages of labour or the profits of stock below
their natural rate.
This is all that I think necessary to be observed at present concerning the
deviations, whether occasional or permanent, of the market price of
commodities from the natural price.
The natural price itself varies with the natural rate of each of its
component parts, of wages, profit, and rent; and in every society this rate
varies according to their circumstances, according to their riches or
poverty, their advancing, stationary, or declining condition. I shall, in
the four following chapters, endeavour to explain, as fully and distinctly
as I can, the causes of those different variations.
First, I shall endeavour to explain what are the circumstances which
naturally determine the rate of wages, and in what manner those
circumstances are affected by the riches or poverty, by the advancing,
stationary, or declining state of the society.
Secondly, I shall endeavour to shew what are the circumstances which
naturally determine the rate of profit ; and in what manner, too, those
circumstances are affected by the like variations in the state of the
society.
Though pecuniary wages and profit are very different in the different
employments of labour and stock ; yet a certain proportion seems commonly to
take place between both the pecuniary wages in all the different employments
of labour, and the pecuniary profits in all the different employments of
stock. This proportion, it will appear hereafter, depends partly upon the
nature of the different employments, and partly upon the different laws and
policy of the society in which they are carried on. But though in many
respects dependent upon the laws and policy, this proportion seems to be
little affected by the riches or poverty of that society, by its advancing,
stationary, or declining condition, but to remain the same, or very nearly
the same, in all those different states. I shall, in the third place,
endeavour to explain all the different circumstances which regulate this
proportion.
In the fourth and last place, I shall endeavour to shew what are the
circumstances which regulate the rent of land, and which either raise or
lower the real price of all the different substances which it produces.
CHAPTER VIII.
OF THE WAGES OF LABOUR.
The produce of labour constitutes the natural recompence or wages of labour.
In that original state of things which precedes both the appropriation of
land and the accumulation of stock, the whole produce of labour belongs to
the labourer. He has neither landlord nor master to share with him.
Had this state continued, the wages of labour would have augmented with all
those improvements in its productive powers, to which the division of labour
gives occasion. All things would gradually have become cheaper. They would
have been produced by a smaller quantity of labour ; and as the commodities
produced by equal quantities of labour would naturally in this state of
things be exchanged for one another, they would have been purchased likewise
with the produce of a smaller quantity.
But though all things would have become cheaper in reality, in appearance
many things might have become dearer, than before, or have been exchanged
for a greater quantity of other goods. Let us suppose, for example, that in
the greater part of employments the productive powers of labour had been
improved to tenfold, or that a day’s labour could produce ten times the
quantity of work which it had done originally ; but that in a particular
employment they had been improved only to double, or that a day’s labour
could produce only twice the quantity of work which it had done before. In
exchanging the produce of a day’s labour in the greater part of employments
for that of a day’s labour in this particular one, ten times the original
quantity of work in them would purchase only twice the original quantity in
it. Any particular quantity in it, therefore, a pound weight, for example,
would appear to be five times dearer than before. In reality, however, it
would be twice as cheap. Though it required five times the quantity of other
goods to purchase it, it would require only half the quantity of labour
either to purchase or to produce it. The acquisition, therefore, would be
twice as easy as before.
But this original state of things, in which the labourer enjoyed the whole
produce of his own labour, could not last beyond the first introduction of
the appropriation of land and the accumulation of stock. It was at an end,
therefore, long before the most considerable improvements were made in the
productive powers of labour ; and it would be to no purpose to trace further
what might have been its effects upon the recompence or wages of labour.
As soon as land becomes private property, the landlord demands a share of
almost all the produce which the labourer can either raise or collect from
it. His rent makes the first deduction from the produce of the labour which
is employed upon land.
It seldom happens that the person who tills the ground has wherewithal to
maintain himself till he reaps the harvest. His maintenance is generally
advanced to him from the stock of a master, the farmer who employs him, and
who would have no interest to employ him, unless he was to share in the
produce of his labour, or unless his stock was to be replaced to him with a
profit. This profit makes a second deduction from the produce of the labour
which is employed upon land.
The produce of almost all other labour is liable to the like deduction of
profit. In all arts and manufactures, the greater part of the workmen stand
in need of a master, to advance them the materials of their work, and their
wages and maintenance, till it be completed. He shares in the produce of
their labour, or in the value which it adds to the materials upon which it
is bestowed; and in this share consists his profit.
It sometimes happens, indeed, that a single independent workman has stock
sufficient both to purchase the materials of his work, and to maintain
himself till it be completed. He is both master and workman, and enjoys the
whole produce of his own labour, or the whole value which it adds to the
materials upon which it is bestowed. It includes what are usually two
distinct revenues, belonging to two distinct persons, the profits of stock,
and the wages of labour.
Such cases, however, are not very frequent; and in every part of Europe
twenty workmen serve under a master for one that is independent, and the
wages of labour are everywhere understood to be, what they usually are, when
the labourer is one person, and the owner of the stock which employs him
another.
What are the common wages of labour, depends everywhere upon the contract
usually made between those two parties, whose interests are
Comments (0)