An inquiry into the nature and causes of the wealth of nations. / Smith, Adam, 1723-1790

Presented to the 
LIBRARY of the 

UNIVERSITY OF TORONTO 

by 

TRIiJITI COLL3GS 



AN 

V 

INQUIRY 

INTO THE 

NATURE AND CAUSES 

OF THE 

WEALTH OF NATIONS. 

i 

VOL. III. 



AN 

INQUIRY 

INTO THE 

NATURE AND CAUSES 

OF THE 

WEALTH OF NATIONS. 

BY 

ADAM SMITH, LL.D. 

AND F. R. S. OF LONDON AND EDINBURGH: 

ONE OF THE COMMISSIONERS OF HIS MAJESTY'S CUSTOMS 

IN SCOTLAND; 

AND FORMERLY PROFESSOR OF MORAL PHILOSOPHY 
IN THE UNIVERSITY OF GLASGOW. 

IN JTHREE VOLUMES. 
VOL. III. 

THE NINTH EDITION. 



LONDON: 

Printed for A. STRAHAN; and T. CADELL jun. and 

W. DAVIES in the Strand. 

MDCCXCIX, 



A/-' 






MAY 2 3 ''972 




/s 









CONTENTS 



OF THE 



THIRD VOLUME. 



BOOK IV. 

CHAR IX. 

S\ F the Agricultural Syftems, or of thofe Syf- 
terns of Political (Economy , which reprefent 
ihe Produce of Land as either the fole or the 
principal Source of the Revenue and Wealth 
of every Country Page I 



BOOK v. 

Of the Revenue of the Sovereign or Com- 
monwealth. 

CHAP. I. 

Of the Expences of the Sovereign or Common- 
wealth -*- _ 44 

PART I. Of the Expence of Defence ibid. 



vi CONTENTS. 

PART II. Of the Expence of Juftice Page 72 

PART III. Of the 'Expence of Public Works 
and Public Inftitutions 92 

I 

ARTICLE ift. Of the Public Works and In- 
ftitutions for facilitating the Commerce of 
Society. ift, For facilitating the general 
Commerce of the Society. 2dly, For facili- 
tating particular Branches of Commerce 93 

ARTICLE id. Of the Expence of the Inftitu- 
t ions for the Education of Tout h 150 

ARTICLE 3d. Of the Expence of the Inftitu- 
tions for the Inftrudion of People of all Ages 192 

PART IV. Of the Expence of fupporting the 
Dignity of the Sovereign -237 

Conclufion of the Chapter 238 

CHAP. II. 

Of the Sources of the general or public Reve- 
nue of the Society 241 

PART I. Of the Funds or Sources of Revenue 
which may peculiarly belong to the Sovereign 
or Commonwealth ibid. 

PART II. Of Taxes 255 

ARTICLE ift. Taxes Upon Rent ; Taxes upon 
the Rent of Land ~. 259 



CONTENTS. vii 

Taxes which are proportioned, not to the Rent, 
but to the Produce of Land Page 274 

Taxes upon the Rent of Houfes 280 

ARTICLE 2d. Taxes upon Profit, or upon the 
Revenue ari/ingfrom Stock 292 

Taxes upon the Profit of particular Employments 301 

APPENDIX TO ARTICLES ift and 2d. Taxes 
upon the Capital Value of Lands, Houfes, 
and Stock 311 

ARTICLE 3d. Taxes upon the Wages of La- 
bour 321 

ARTICLE 4th. Taxes which, it is intended, 
Jhould fall indifferently upon every different 
Species of Re-venue 327 

Capitation Taxes ibid. 

Taxes upon confumable Commodities 331 



CHAP. III. 

Of Public Debts 394 



AN 

INQUIRY 

INTO THE 

NATURE AND CAUSES 

OF THE 

WEALTH OF NATIONS. 



BOOK IV. 

CHAP. IX. 

Of the agricultural Syftems, or of thofe Syftems of 
political GEconomy, which reprefent the Produce of 
Land as either the fole or the principal Source of 
the Revenue and Wealth of every Country. 

TH E agricultural fyftems of political oeco- BOOK 
nomy will not require fo long an expla- CHAP. 
nation as that which I have thought it neceffary 
to beftow upon the mercantile or commercial 
fyftem. 

THAT fyftem which reprefents the produce of 
land as the fble fource of the revenue and wealth 
of every country has, fo far as I know, never been 
adopted by any nation, and it at prefent exifts 
only in the fpeculations of a few men of great 

VOL. in. B learning 




THE NATURE AND CAUSES OF 

learning and ingenuity in France. It would not, 
furely, be worth while to examine at great length 
the 'errors of a fyftem which never has done, and 
probably never will do any harm in any part of 
the world. I fhall endeavour to explain, how- 
ever, as diftinclly as I can, the great outlines of 
this very ingenious fyftem. 

MR. COLBERT, the famous minifler of Lewis 
XIV. was a man of probity, of great induftry 
and knowledge of detail ; of great experience 
and acutenefs in the examination of public ac- 
counts, and of abilities, in fhort, every way fitted 
for introducing method and good order into the 
collection and expenditure of the public revenue. 
That minifler had unfortunately embraced all the 
prejudices -of the mercantile fyftem, in its nature 
and efience a fyftem of reftraint and regulation-, 
and fuch as could fcarce fail to be agreeable to a 
laborious and plodding man of bufmefs, who had 
been accuftomed to regulate the different depart* 
ments of public offices, and to eftablifh the ne- 
ceflary checks and controuls for confining each 
to its proper fphere. The induftry and com- 
merce of a great country he endeavoured to re- 
gulate upon the fame model as the departments 
of a public office ; and inftead of allowing every 
man to purfue his own intereft his own way, upon 
the liberal plan of equality, liberty and juftice, 
he beftowed upon certain branches of induftry 
extraordinary privileges, while he laid others 
under as extraordinary reftraints. ' He was not 
enly difpofed, like other European minifters, to 

encourage 



THE WEALTH OF NATIONS; $ 

encourage more the induflry of the towns than c H A p 
that of the country, but, in order to fupport the 
induftry of the towns^ he was willing even to de- 
prefs and keep down that of the country. In 
order to render provifions cheap to the inhabit- 
ants of the towns, and thereby to encourage ma- 
nufaftures and foreign commerce, he prohibited 
altogether the exportation of corn, and thus ex- 
cluded the inhabitants of the country from every 
foreign market for by far the moft important part 
of the produce of their induftry. This prohibi- 
tion, joined to the reftraints impofed by the antient 
provincial laws of France upon the tranfportation 
of corn from one province to another, and to the 
arbitrary and degrading taxes which are levied 
upon the cultivators in almoft all the provinces, 
difcouraged and kept down the agriculture of 
that country very much below the Hate to which, 
it would naturally have rifen in fo very fertile a 
foil and fo very happy a climate. This ftate of 
difcouragement and depreffion was felt more or 
lefs in every different part of the country, and 
many different inquiries were fet on foot con- 
cerning the caufes of it. One of thofe caufes 
appeared to be the preference given by the infti- 
tutions of Mr. Colbert, to the induftry of the 
towns above that of the country. 

IF the rod be bent too much one way, fays the 
proverb, in order to make it ftraight you muffc 
bend it as much the other. The French phi- 
lofophers, who have propofed the fyftem which 
reprefents agriculture as the fole fource of the re- 
venue and wealth of every country, feem to have 

B % adopted 




THE NATURE AND CAUSES OF 

adopted this proverbial maxim; and as in the 
plan of Mr. Colbert the induftry of the towns was 
certainly over-valued in companion with that of 
the country ; fo in their fyftem it feems to be as 
certainly under-valued. 

THE different orders of people who have ever 
been fuppofed to contribute in any refpeft to- 
wards the annual produce of the land and labour 
of the country, they divide into three clafles* 
The firft is the clafs of the proprietors of land. 
The fecond is the clafs of the cultivators, of 
farmers and country labourers, whom they ho- 
nour with the peculiar appellation of the pro- 
ductive clafs. The third is the clafs of artificers, 
manufacturers and merchants, whom they endea- 
vour to degrade by the humiliating appellation of 
the barren or unproductive clafs. 

THE clafs of proprietors contributes to the an- 
nual produce by the expence which they may oc- 
cafionally lay out upon the improvement of the 
land, upon the buildings, drains, enclofures and 
other ameliorations, which they may either make 
or maintain upon it, and by means of which the 
cultivators are enabled, with the fame capital, to 
raife a greater produce, and confequently to pay 
a greater rent. This advanced rent may be con- 
fidered as the intereft or profit due to the proprie- 
tor upon the expence or capital which he thus 
employs in the improvement of h his land. Such 
expences are in this fyftem called ground expences 
(depenfes foncieres). 

THE cultivators or farmers contribute to the 
annual produce by what are in this fyftem called 

. the 



THE WEALTH OF NATIONS. 

the original and annual expences (depenfes pri- 
mitives et depenfes annuelles) which they lay 
out upon the cultivation of the land. The ori- 
ginal expences confift in the inftruments of huf- 
bandry, in the flock of cattle, in the feed, and 
in the maintenance of the farmer's family, fer- 
vants and cattle, during at lead a great part of 
the firft year of his occupancy, or till he can re- 
ceive fome return from the land. The annual 
expences confift in the feed, in the wear and tear 
of the inftruments of hufbandry, and in the an- 
nual maintenance of the farmer's fervants and 
cattle, and of his family too, fo far as any part 
of them can be confidered as fervants employed 
in cultivation. That part of the produce of the 
land which remains to him after paying the rent, 
ought to be fufficient, firft, .to replace to him 
within a reafonable time, at leaft during the term 
of his occupancy, the whole of his original ex- 
pences, together with the ordinary profits of 
flock ; and, fecondly, to replace to him annually 
the whole of his annual expences, together like- 
wife with the ordinary profits of flock. Thofe 
two forts of expences are two capitals which the 
farmer employs in cultivation ; and unlefs they 
are regularly reftored to him, together with a 
reafonable profit, he cannot carry on his employ- 
ment upon a level with other employments ; but, 
from a regard to his own intereft, muft defert 
it as foon as poffible, and feek fome other. That 
part of the produce of the land which is thus ne- 
ceflary for enabling the farmer to continue his 
bufmefs, ought to be confidered as a fund facred 

B 3 to 





6 -THE NATURE AND CAUSES OF 

BOOK to cultivation, which if the landlord violates, he 
jieceiTarily reduces the produce of his own land, 
and in a few years not only difables the farmer 
from paying this- racked rent, but from paying 
the reafonable rent which he might otherwife 
have got for his land. The rent which properly 
belongs to the landlord, is no more than the neat 
produce which remains after paying in the com- 
pleteft manner all the neeeflary expences which 
muft be previoufly laid out in order to raife the 
grofs, or the whole produce. It is becaufe the 
labour of the cultivators, over and above paying 
completely all thofe neceffary expences, affords 
a neat produce of this kind, that this clafs of 
people are in this fyftem peculiarly diftinguifhed 
by the honourable appellation of the productive 
clafs. Their original and annual expences are 
for the fame reafon called, in this fyftem, pro- 
du&ive expences, becaufe, over and above re- 
placing their own value, they occafion the annual 
reproduction of this neat produce. 

THE ground expences, as they are called, or 
what the landlord lays out upon the improve- 
ment of his land, are in this fyftem too honoured 
with the appellation of productive expences. 
Till the whole of thofe expences, together with 
the ordinary profits of flock, have been com- 
pletely repaid to him by the advanced rent which 
he gets from his land, that advanced rent ought 
to be regarded as facred and inviolable, both by 
the church and by the king ; ought to be fubjeCt 
neither to tithe nor to taxation. If it is other- 
wife, by difceuraging the improvement of land, 

the 



THE WEALTH OF NATIONS. 7 

the church difcourages the future increafe of her c H A p. 
own tithes, and the king the future increafe of 
his own taxes. As in a well-ordered ftate of 
things, therefore, thofe ground expences, over 
and above reproducing in the completed man- 
ner their own value, occafion likewise after a cer- 
tain time a reproduction of a neat produce, they 
are in this fyflem confidered as productive ex- 
pences, 

THE ground expences of the landlord, how- 
ever, together with the original and the annual 
expences of the farmer, are the only three forts 
of expences which in this fyflem are confidered 
as productive. All other expences and all other 
orders of people, even thofe who in the common 
apprehenfions of men are regarded as the mod 
productive, are in this account of things repre- 
fented as altogether barren and unproductive. 

ARTIFICERS and manufacturers, in particular, 
whofe induflry, in the common apprehenfions of 
men, increafes fo much the value of the rude 
produce of land, are in this fyflem reprefented 
as a clafs of people altogether barren and un- 
productive. Their labour, it is faid, replaces 
only the flock which employs them, together 
with 'its ordinary profits. That flock confifts in 
the materials, tools, and wages, advanced to them 
by their employer ; and is the fund deflined for 
their employment and maintenance. Its profits 
are the fund deflined for the maintenance of their 
employer. Their employer, as he advances to 
them the flock of materials, tools and wages 
jieceflary for their employment, fo he advances 

* 4 to 




THE NATURE AND CAUSES OF 

to himfelf what is neceflary for his own mainte- 
nance, and this maintenance /he generally pro- 
portions to the profit which he expects to make 
by the price of their work. Unlefs its price re- 
pays tp him the maintenance which he advances 
to himfelf, as well as the materials, tools and 
wages which he advances to his workmen, it evi- 
dently does not repay to him the whole expence 
which he lays out upon it. The profits of ma* 
nufacturing flock, therefore, are not, like the rent 
of land, a neat produce which remains after com- 
pletely repaying the whole expence which muft 
be laid out in order to obtain them. The ftock 
of the farmer yields him a profit as well as that 
of the mafter manufacturer ; and it yields a rent 
likewife to another perfon, which that of the 
mafter manufacturer does not. The expence, 
therefore, laid out in employing and maintain* 
ing artificers and manufacturers, does no more 
than continue, if one may fay fo, the exiftence 
of its own value, and does not produce any new 
value. It is therefore altogether a barren and 
unproductive expence. The expence, on the 
contrary, laid out in employing farmers and 
country labourers, over and above continuing 
the exiftence of its own value, produces a new 
value, ' the rent of the landlord. It is therefore a 
productive expence. 

MERCANTILE ftock is equally barren and un- 
produftive with manufacturing ftock. It only 
continues the exiftence of its own value, without 
producing any new value. Its profits are only 
the repayment of the maintenance which its em- 

ployer 



THE WEALTH OF NATIONS. 9 

ployer advances to himfelf during the time that CHAP. 
he employs it, or till he receives the returns of 
it. They are only the repayment of a part of 
the expence which muft be laid out in employ- 
ing it. 

THE labour of artificers and manufacturers 
never adds any thing to the value of the whole 
annual amount of the rude produce of the land. 
It adds indeed greatly to the value of fome par- 
ticular parts of it. But the confumption which 
in the mean time it occafions of other parts, is 
precifely equal to the value which it adds to thofe 
parts ; fo that the value of the whole amount is 
not, at any one moment of time, in the lead 
augmented by it. The perfon who works the 
lace of a pair of fine ruilles, for example, will 
fometimes raife the value of perhaps a penny- 
worth of flax to thirty-pounds fterling. But 
though at firft fight he appears thereby to mul- 
tiply the value of a part of the rude produce 
about feven thoufand and two hundred itimes, he 
in reality adds nothing to the value of the whole 
annual amount of the rude produce. The work- 
ing of that lace coils him perhaps two years la- 
bour. The thirty pounds which he gets for it 
when it is finiftied, is no more than the repay- 
ment of the fubfiftence which he advances to 
himfelf during the two years that he is employ- 
ed about it. The value which, by every day's, 
month's, or year's labour, he adds to the flax, 
does no more than replace the value of his own 
confumption during that day, month, or year. 
At no moment of time, therefore, does he add 

any 



10 



THE NATURE AND CAUSES OF 



BOOK any thing to the value of the whole annual 
amount of the rude produce of the land : the 
portion of that produce which he is continually 
confuming, being always equal to the value 
which he is continually producing. The extreme 
poverty of the greater part of the perfons employed 
in this expenfive, though trifling manufacture, 
may fatisfy us that the price of their work does 
not in ordinary cafes exceed the value of their 
fubfiftence. It is otherwife with the work of 
farmers and country labourers. The rent of the 
landlord is a value, which, in ordinary cafes, it is 
continually producing, over and above replacing, 
in the moil complete manner, the whole con* 
fumption, the whole expence laid out upon the, 
employment and maintenance both of the work- 
men and of their employer. 

ARTIFICERS, manufacturers, and merchants, can 
augment the revenue and wealth of their fociety, 
, by parfimony only ; or, as it is exprefled in this 
fyftem, by privation, that is, by depriving them- 
felves of a part of the funds deflined for their 
own fubfiftence. They annually reproduce no- 
thing but thofe funds. Unlefs, therefore, they 
annually fave fome part of them, unlefs they an- 
nually deprive themfelves of the enjoyment of 
foine part of them, the revenue and wealth of 
their fociety can never be in the fmalleft degree 
augmented by means of their induftry. Farmers 
and country labourers, on the contrary, may en- 
joy completely the whole funds deftined for their 
own fubfiftence, and yet augment at the fame 
^me the revenue and wealth of their fociety, 

Over 



THE WEALTH OF NATIONS. n 

Over and above what is deftined for their own CHAP. 
fubfiftence their induftry annually affords a neat 
produce, of which the augmentation neceflarily 
augments the revenue and wealth of their fociety. 
Nations, therefore, which, like France or Eng- 
land, confifl in a great meafure of proprietors and 
cultivators, can be enriched by induftry and en- 
joyment. Nations, on the contrary, which, like 
Holland and Hamburgh, are compofed chiefly 
of merchants, artificers, and manufacturers, can, 
grow rich only through parfimony and privation. 
As the intereft of nations fo differently circum- 
flanced, is very different, fo is likewife the com- 
mon character of the people. In thofe of the 
former kind, liberality, franknefs, and good fel- 
lowfliip naturally make a part of that common 
character. In the latter, narrownefs, meannefs, 
and a felfifh difpofition, averfe to all focial plea- 
fure and enjoyment. 

THE unproductive clafs, that of merchants, 
artificers, and manufacturers, is maintained and 
employed altogether at the expence of the two 
other claffes, of that of proprietors, and of that 
of cultivators. They furnifh it both with the 
materials of its work and with the fund of its 
fubfiftence, >vith the corn and cattle which it 
confumes while it is employed about that work. 
The proprietors and cultivators finally pay both 
the wages of all the workmen of the unproduc- 
tive clafs, and the profits of all their employers. 
Thofe workmen and their employers are properly 
the fervants of the proprietors and cultivators. 
They are only fervants who work without doors, 

as 




12 THE NATURE AND CAUSES OF 

BOOK as menial fervants work within. Both the one and 
the other, however, are equally maintained at the 
expence of the fame matters. The labour of both 
is equally unproductive. It adds nothing to the 
value of the fum total of the rude produce of the 
land. Inftead of increafmg the value of that fum 
total, it is a charge and expence which muft be 
paid out of it. 

THE unproductive clafs, however, is not only 
ufeful, but greatly ufeful to the other two clafles. 
By means of the induftry of merchants, artifi- 
cers and [manufacturers, the proprietors and cul- 
tivators can purchafe both the foreign goods and 
the manufactured produce of their own country 
which they have occafion for, with the produce 
of a much fmaller quantity of their own labour, 
than what they would be obliged to employ, if 
they were to attempt, in an aukward and unfldl- 
ful manner, either to import the one or to make 
the other for their own ufe. By means of the 
unproductive clafs, the cultivators are delivered 
from many cares which would otherwife diftract 
their attention from v the cultivation of land. 
The fuperiority of produce, which, in confe- 
quence of this undivided attention, they are en- 
abled to raife, is fully fufficient to pay the whole 
expence which the maintenance and employment 
of the unproductive clafs cofts either the pro- 
prietors, or themfelves. The induftry of mer- 
chants, artificers, and manufacturers, though in 
its own nature altogether unproductive, yet con- 
tributes in this manner indirectly to increafe the 
produce of the land. It increafes the productive 
15 powers 



THE WEALTH OF NATIONS. 

powers of productive labour, by leaving it at c 
liberty to confine itfelf to its proper employment, 
the cultivation of land ; and the plough goes fre- 
quently the eafier and the better by means of the 
labour of the man whofe bufmefs is moil remote 
from the plough. 

IT can never be the intereft of the proprietors 
and cultivators to reft rain or to difcourage in any 
refpect the induftry of merchants, artificers and 
manufacturers. The greater the liberty which 
this unproductive clafs enjoys, the greater will 
be the competition in all the different trades 
which compofe it, and the cheaper will the other 
two claffes be fupplied, both with foreign goods 
and with the manufactured produce of their own 
country. 

: IT can never be the intereft of the unproduc- 
tive clafs to opprefs the other two ^claffes. It is 
the furplus produce of the land, or what remains 
after deducting the maintenance, firft, of the 
cultivators, and afterwards, of the proprietors, 
that maintains and employs the unproductive 
clafs. The greater this furplus, the greater muft 
likewife be the maintenance and employment of 
that clafs. The' eftablifhment of perfect juftice, 
of perfect liberty, and of perfect equality, is the 
very fimple fecret which moft effectually fecures 
the higheft degree of profperity to all the three 
claffes. 

THE merchants, artificers and manufacturers 
of thofe mercantile ftates which, like Holland 
and Hamburgh, confift chiefly of this unpro- 
ductive clafs, are in the fame manner maintained, 

and 




14 THE -NATURE AND CAUSES 0$ 

BOOK and employed altogether at the expence of the 
proprietors and cultivators of land. The only 
difference is, that thofe proprietors and cultiva- 
tors are, the greater part of them, placed at 
a moft inconvenient diflance from the mer- 
chants, artificers and manufacturers whom they 
fupply with the materials of their work and the 
fund of their fubfiftence, are the inhabitants of 
other countries, and the fubjects of other govern- 
ments. 

SUCH mercantile ftates, however, are not only 
ufeful, but greatly ufeful to the inhabitants of 
thofe other countries. They fill up, in fome 
meafure, a very important void, and fupply the_ 
place of the merchants, artificers and manufac- 
turers, whom the inhabitants of thofe countries 
ought to find at home, but whom, from fome 
defect in their policy, they do not find at home. 

IT can never be the intereft of thofe landed 
nations, if I may call them fo, to difcourage or 
diftrefs the induftry of fuch mercantile dates, by 
impofing high duties upon their trade, or upon 
the commodities which they furnifh. Such 
duties, by rendering thofe commodities dearer, 
could ferve only to fink the real value of the 
furplus produce of their own land, with which, 
or, what comes to the fame thing, with the price 
of which thofe commodities are purchafed. 
Such duties could ferve only to difcourage the 
increafe of that furplus produce, and confequently 
the improvement and cultivation of their own 
land. The moft effectual expedient, on the con- 
trary, for raifing the value of that furplus pro- 
duce, 



THE WEALTH OF NATIONS. 15 

dace, for encouraging its increafe, and confe- CHAP. 
quently the improvement and cultivation of their 
own land, would be to allow the moil perfect 
freedom to the trade of all fuch mercantile na- 
tions. 

THIS perfect freedom of trade would even be 
the moft effectual expedient for fupplying them; 
in due time, with all the artificers, manufacturers 
and merchants whom they wanted at home, and 
for filling up in the properefl and mofl advan- 
tageous manner that very important void which 
they felt there. 

THE continual increafe of the furplus produce 
of their land would, in due time, create a 
greater capital than what could be employed 
with the ordinary rate of profit in the improve- 
ment and cultivation of land ; and the furplus 
part of it would naturally turn itfelf to the em- 
ployment of artificers and manufacturers at home. 
But thofe artificers and manufacturers, finding at 
h6me both the materials of their work and the 
fund of their fubfiftence, might immediately, 
even with much lefs art and fkill, be able to 
work as cheap as the little artificers and manu- 
facturers of fuch mercantile ftates, who had both 
to bring from a greater diflance. Even though, 
from want of art and fkill, they might not for 
fome time be able to work as cheap, yet, finding a 
market at home, they might be able to fell their 
work there as cheap as that of the artificers and 
manufacturers of fuch mercantile ftates, \vhich 
could not be brought to that market but from fa 
.great a diflance ; and as their art and (kill im- 
G . proved, 



t6 THE NATURE AND CAUSES OF 

BOOK proved, they would foon be able to fell it cheaper. 
The artificers and manufacturers of fuch mer- 
cantile dates, therefore, would immediately be 
rivalled in the market of thofe landed nations, 
and foon after underfold and juftled out of it alto- 
gether. The cheapnefs of the manufactures of 
thofe landed nations, in confequence of the gra- 
dual improvements of art and ikill, would, in 
due time, extend their fale beyond the home mar- 
ket, and carry them to many foreign markets, 
from which they would in the fame manner gra- 
dually juftle out many of the manufacturers of fuch 
mercantile nations. 

THIS continual increafe both of the rude and 
manufactured produce of thofe landed nations 
would in due time create a greater capital than 
could, with the ordinary rate of profit, be em- 
ployed either in agriculture or in manufactures. 
The furplus of this capital would naturally turn 
itfelf to foreign trade, and be employed in ex- 
porting, to foreign countries, fuch parts of the 
rude and manufactured produce of its own 
country, as exceeded the demand of the home 
market. In the exportation of the produce of 
their own country, the merchants of a landed 
nation would have an advantage of the fame kind 
over thofe of mercantile nations, which its arti- 
ficers and manufacturers had over the artificers 
and manufacturers of fuch nations ; the advan- 
tage of finding at home that cargo, and thofe 
ftores and provifions, which the others were 
obliged to feek fqr at a diitance. With inferior 
art and ikill in navigation, therefore, they would 

be 



THE WEALTH OF NATIONS. 17 

be able to fell that cargo as cheap in foreign mar- CHAP. 
kets as the merchants of fuch mercantile nations ; 
and with equal art and fkill they would be able to 
fell it cheaper. They would foon, therefore, rival 
thofe mercantile nations in this branch of foreign 
trade, and in due time would juftle them out of it 
altogether. 

ACCORDING to this liberal and generous fyftem, 
therefore, the mod advantageous method in which 
a landed nation can raife up artificers, manufac- 
turers and merchants of its own, is to grant the 
moil perfect freedom of trade to the artificers, 
manufacturers and merchants of all other nations. 
It thereby raifes the value of the furplus produce 
of its own land, of which the continual increafe 
gradually eltablifhes a fund, which in due time ne- 
ceflarily raifes up all the artificers, manufacturers 
and merchants whom it has occafion for. 

WHEN a landed nation, on the contrary, op- 
preffes, either by high duties or by prohibitions, 
the trade of foreign nations, it neceflarily hurts 
its own intereft in two different ways. Firft, by 
raifing the price of all foreign goods and of all 
forts of manufactures it neceflarily finks the real 
value of the furplus produce of its own land, with 
which, or, what cornes to the fame thing, with 
the price of which, it purchafes thofe foreign- 
goods and manufactures. Secondly, by giving a 
fort of monopoly of the home market to its own 
merchants, artificers and manufacturers, it raifes 
the rate of mercantile and manufacturing profit, 
in proportipn to that of agricultural profit, and 

VOL. in. c confe- 




1 8 THE NATURE AND CAUSES OF 

confequently either draws from agriculture a part 
of the capital which had before been employed 
in it, or hinders from going to it a part of what 
would otherwife have gone to it. This policy, 
therefore, difcourages agriculture in two differ- 
ent ways j firft by finking the real value of its 
produce, and thereby lowering the rate of its 
profits ; and, fecondly, by raifing the rate of 
profit in all other employments. Agriculture is 
rendered lefs advantageous, and trade and manu- 
factures more advantageous than they otherwife 
would be ; and every man is tempted by his own 
intereft to turn, as much as he can, both his capi- 
tal and his induftry from the former to the latter 
employments. 

THOUGH, by this opprefTive policy, a landed 
nation mould be able to raife up artificers^ 
manufacturers and merchants of its own, fome- 
what fooner than it could do by the freedom of 
trade ; a matter, however, which is not a little 
doubtful ; yet it would raife them up, if one 
may fay fo, prematurely, and before it was per- 
fectly ripe for them. By raifing up too haitily 
one fpecies of induftry, it would deprefs another 
more valuable fpecies of induftry. By raifing 
up loo haftily a fpecies of induftry which only 
replaces the ftock which employs it, together 
with the ordinary profit, it would deprefs a 
fpecies of induftry which, over and above re- 
placing that ftock with its profit, affords like- 
wife neat produce, a free rent to the landlord. 
It wqald deprefs productive labour, by encou- 
raging 



THE WEALTH OF NATIONS. 19 

higing too haitily that labour which is altogether C/H A P. 
barren and unproductive. 

IN what manner, according to this fyftem, the 
fum total of the annual produce of the land is 
diitributed among the three clafles above men- 
tioned, and in what manner the labour of the 
unproductive clafs does no more than replace 
the value of its own confumption, without in- 
creafmg in any refpect the value of that fum 
total, is reprefented by Mr. Quefnai, the very 
ingenious and profound author of this fyftem, 
in fome arithmetical formularies. The fiffl of 
thefe formularies, which by way of eminence he 
peculiarly diftinguimes by the name of the CEco- 
nomical Table, reprefents the manner in which 
he fuppofes thUs distribution takes place, in a 
ftate of the moft perfect liberty* and therefore of 
the higheft profperity ; in a ftate where the an- 
nual produce is fuch as to afford the greatefl 
poffible neat produce, and where each clafs en- 
joys its proper mare of the whole annual pro- 
duce. Some fubfequent formularies reprefent 
the manner, in which, he fuppofes, this diftri- 
bution is made in different ftates of reftraint and 
regulation ; in which, either the clafs of proprie- 
tors, or the barren and unproductive .clafs, is 
more favoured than the clafs of cultivators, 
and in' which, either the one or the other en- 
croaches more or lefs upon -the {hare which ought 
properly to belong to this productive clafs. Every 
fuch encroachment, every violation of that na- 
tural diftribution, whieh the moft perfect liberty 
would eftablifh, muft, according to this fyftem, 
c 2 neceffarily 



ao THE NATURE AND CAUSES OF 

BOOK neceffarily degrade more or lefs, from one year 
_J^1._ to another, the value and fum total of the 
annual produce, and muft neceflfarily occafion a 
gradual declenfion in the real wealth and revenue 
of the fociety ; a declenfion of which the progrefs 
muft be quicker or flower, according to the de- 
gree of this encroachment, according as that 
natural diflribution, which the moft perfect li- 
berty would eftablifh, is more or lefs violated. 
Thofe fubfequent formularies reprefent the dif- 
ferent degrees of declenfion, which, according 
to this fyftem, correfpond to the different degrees 
in which this natural diflribution .of things is 
violated. 

SOME fpeculative phyficians feem to have ima- 
gined that the health of the human body could 
be preferved only by a certain precife regimen 
of diet and exercife, of which every, the fmalleft, 
violation necefiarily dccafioned fome degree of 
difeafe or diforder proportionate to the degree of 
the violation. Experience, however, would feem 
to mow, that the human body frequently pre- 
fer ves, to all ippearance at lead, the mofl per- 
fect ftate of health under a vaft variety of differ- 
ent regimens ; even under fome which are ge- 
nerally believed to be very far from being per- 
fectly wholefome. But the healthful ftate of the 
human body, it would feem, contains in itfelf 
fome unknown principle of prefervation, capable 
either of preventing or of correcting, in many 
refpects, the bad effects even of a very faulty 
regimen. Mr. Quefnai, who was himfelf a phy- 
fician, and a very fpeculative phyiician, feems to 

have 



THE WEALTH OF NATIONS. ai 

have entertained a notion of the fame kind con- c H A H. 
cerning the political body, and to have imagined 
that it would thrive and profper only under a 
certain precife regimen, the exact regimen of 
perfect liberty and perfect juflice. He feems not 
to have confidered that in the political body, 
the natural effort which every man is continually 
making to better his own condition, is a prin- 
ciple of prefervation capable of preventing and 
correcting, in many refpects, the bad effects of a 
political ceconomy, in fome degree both partial 
and oppreflive. Such a political ceconomy, 
though it no doubt retards more or lefs, is not 
always capable of flopping altogether the natural 
progrefs of a nation towards wealth and pro- 
fperity, and (till lefs of making it go backwards. 
If a nation could not profper without the enjoy- 
ment of perfect liberty and perfect juflice, there 
is not in the world a nation which could ever 
have profpered. In the political body, however, 
the wifdom of nature has fortunately made ample 
provifion for remedying many 'of the bad effects 
of the folly and injuflice of man ; in the fame 
manner as it has done in the natural body, for 
remedying thofe of his floth and intemperance. 

THE capital error of this fyflem, however, feems 
to lie in its reprefenting the clafs of artificers, ma- 
facturers and merchants, as altogether barren 
and unproductive. The following obfervations 
may ferve to mew the impropriety of this repre- 
fentation. v 

FIRST, this clafs, iPis acknowledged, repro- 
duces annually the value of its own annual con- 
c 3 fumption^ 



^^ THE NATURE AND CAUSES OP 

BOOK, fumption, and continues, at leaft, the exiftence 
of the (lock or capital which maintains and em- 
ploys it. But upon this account alone the de- 
nomination of barren or unproductive fliould 
feein to be very improperly applied to it. We 
mould not call a marriage barren or unproduc- 
tive, though it produced only a fon and a 
daughter, to replace the father and mother, and 
though it did not increafe the number of the 
human fpecies, but only continued it as Jt was 
before. Farmers and country labourers, indeed, 
over and above the flock which maintains and 
employs them, reproduce annually a neat pro- 
duce, a free rent to the landlord, As a marriage 
which affords three cMldren is certainly more 
productive than one which affords only two ; fo 
the labour of farmers and country labourers is 
certainly more productive than that of merchants, 
artificers acid manufacturers. The fuperior pro- 
duce of the one clafs, however, does not render 
the other barren or unproductive. 

SECONDLY, it feems, upon this account, alto* 
gether improper to confider artificers, manufac- 
turers and merchants in the fame light as me- 
nial fervants. The labour of menial fervants 
does not continue the exiftence of the fund which 
maintains and employs them. Their mainte- 
nance and employment is altogether at the ex- 
pence of their mafters, and the work which they 
perform is not of a nature to repay that expence. 
That work confifls in fervices which perifh ge- 
perally in the very inilani of their performance, 
and does not fix or realize itfelf in any vendible 

commodity 



THE WEALTH OF NATIONS. . 25 

commodity which can replace the value of their CHAP. 
wages and maintenance. The labour, on the con- 
trary, of artificers, manufacturers and merchants, 
naturally does fix and realize itfelf in lome fuch 
vendible commodity. It is upon this account that, 
in the chapter in which I treat of productive and 
unproductive labour, I have clafTed artificers, 
manufacturers and merchants, among the produc- 
tive labourers, and menial fervants among the 
barren or unproductive. 

THIRDLY, it feems, upon every fuppofition, 
improper to fay, that ' the labour of artificers, 
manufacturers and merchants, does not increafe 
the real revenue of the fociety. Though we 
Ihould fuppofe, for example, as it feems to be 
fuppofed in this fyftem, that the value of the 
daily, monthly, and yearly confumption of 
this clafs was exactly equal to that of its 
daily, monthly, and yearly production ; yet it 
would not from thence follow that its labour 
added nothing to the real revenue, to the real 
value of the annual produce of the land and la- 
bour of the fociety. An artificer, for example, 
who, in the firft fix months after harveft, executes 
ten pounds worth of work, though he mould in the 
fame time confume ten pounds worth of corn and 
other neceflaries, yet really adds the value of ten 
pounds to the annual produce of the land and 
labour of the fociety. While he has been con- 
fuming a half yearly revenue of ten pounds worth 
of corn and other neceffaries, he has produced an 
equal value of work capable of purchafing, either 
to himfelf or to fome other perfon, an equal half 
yearly revenue. The value, therefore, of what 
c 4 has 



24 THE NATURE AND CAUSES OF 

BOOK has been confumed and produced during thefe 
i_ M - |/ l x . fix months is equal, not to ten, but to twenty 
pounds. It is poflible, indeed, that no more 
than ten pounds worth of this value, may ever 
have exifled at any one moment of time. But if 
the ten pounds worth of corn and other necef- 
faries, which were confumed by the artificer, had 
been confumed by a foldier or by a menial fer- 
vant, the value of that part of the annual produce 
which exifted at the end of the fix months, would 
have been ten pounds lefs than it actually is in 
confequence of the labour of the artificer. Though 
the value of what the artificer produces, there- 
fore, mould not at any one moment of time be 
fuppofed greater than the value he confumes, 
yet at every moment of time the actually exifting 
value of goods in the market is, in confequence 
of what he produces, greater than it otherwife 
would be, 

WHEN the patrons of this fyftem aflert, that the 
confumption of artificers, manufacturers and 
merchants, is equal to the value of what they 
produce, they probably mean no more than that 
their revenue, or the fund deftined for their con- 
fumption, is equal to it. But if they had ex~ 
pretfed themfelves more accurately, and only 
afferted, that the revenue of this clafs was equal 
tq the va,Jue of what they produced, it might 
readily have occurred to the reader, that \vh?,t 
would naturally be faved out of this revenue, 
mufl neceflarily increafe more 01 lefs the real 
wealth of the fociety. In order, therefore, to 
make out fomething like an argument, it .was 
necefiary that they fhould exprefs themfelves as 

they 



THE WEALTH OF NATIONS. 25 

they have; done ; and this argument, even fup- CHAP. 
pofing things actually were as it feems to pre- 
fume them to be, turns out to be a very incon- 
clufive one. 

FOURTHLY, farmers and country labourers pan 
no more augment, without parfimony, the real 
revenue, the annual produce of the land and la- 
bour of their fociety, than artificers, manufactu- 
rers and merchants. The annual produce of 
the land and labour of any fociety can be aug- 
mented only in two ways ; either, firft, by fome 
improvement in the productive powers of the 
ufeful labour actually maintained within it ; or, 
fecondly, by fome increafe in the quantity of 
that labour. 

THE improvement in the productive powers of 
ufeful labour depend, firft, upon the improve- 
ment in the ability of the workman ; and, 
fecondly, upon that of the machinery with which 
he works. But the labour of artificers and ma- 
nufactures, as it is capable of being more fub- 
divided, and the labour of each workman re- 
duced to a greater fimplicity of operation, than 
that of farmers and country labourers, fo it is 
likewife capable of both thefe forts of improve- 
ment in a much higher degree *. In this re- 
fpect, therefore', the clafs of cultivators can have 
no fort of advantage over that of artificers and 
manufacturers. 

THE increafe in the quantity of ufeful labour 
actually employed within any fociety, mud de- 

* See Book I. Chap. I. 

pend 




THE NATURE AND CAUSES OF 

pend altogether upon the increafe of the capital 
which employs it ; and the increafe of that capi- 
tal again mud be exactly equal to the amount 
of the favings from the revenue, either of the 
particular perfons . who manage and direct the 
employment of that capital, or of fome other 
perions who lend it to them. If merchants, artifi- 
cers and manufacturers are, as this fydem feems 
*to fuppofe, naturally more inclined to parfimony 
and faving than proprietors and cultivators., they 
are, ib far, more likely to augment the quantity of 
ufeful labour employed within their fociety, rand 
confequently to increafe its real revenue, the annual 
produce of its land and labour. 

FIFTHLY and ladly, though the revenue of the 
inhabitants of every country was fuppofed to 
confifl altogether, as this fyftem feems to fup- 
pofe, in tile quantity of fubfidence which their 
indudry could procure to them; yet, even upon 
this fuppofition, the revenue of a trading and 
manufacturing country mud, other things being 
equal, always be much greater than that of one 
without trade or manufactures. 'By means of 
trade and manufactures, a greater quantity of 
fubfidence can be annually imported into a par* 
t-icular- country than what its own lands, in the 
actual date of their cultivation, could afford. 
The inhabitants of a town, though they fre- 
quently poflefs no lands of their own, yet draw 
to themfelves by their indudry fuch a quantity 
of the rude produce of the lands of other people 
as fupplies them, not only with the materials of 
their work, but with the fund of their fubfidence. 

What 



THE WEALTH OF NATIONS. 2- 

What a town ' always is with regard to the CHAP, 
country in its neighbourhood, one independent 
flate or country may frequently be with regard 
to other independent dates or countries. It is 
thus that Holland draws a great part of its fub- 
fiftence from other countries ; live cattle- from 
Holftein and Jutland, and corn from almoil all 
the different countries of Europe. A ^ fmall 
quantity of manufactured produce purchafes a 
great quantity of rude produce. A trading and 
manufacturing country, therefore, naturally pur- 
chafes with a fmall part of its manufactured pro- 
duce a great part of the rude produce of other 
countries ; while, on the contrary, a country 
without trade and manufactures is generally 
obliged to purchafe, at the expence of a great 
part of its rude produce, a very fmall parf of the 
manufactured produce of other countries. The 
one exports what can fubfift and accommodate 
but a very few, and imports the fubfiflence and 
accommodation of a great number. The other 
exports the accommodation and fubfiftence of a 
great number, and imports that of a very few 
only. The inhabitants of the one mud always 
enjoy a much greater quantity of fubfiftence than 
what their own lands, in the actual ftate of their 
cultivation, could afford. The inhabitants of 
the other muft always enjoy a much fmaller 
quantity. 

THIS fyftem, however, with all its imperfec- 
tions, is, perhaps, the nearefl approximation to the 
truth that has yet been publiflied upon the fubjecl: 
of political (Economy, and is upon that account 

well 




2 8 THE NATURE AND CAUSES OF 

y 

BOOK, well worth the confideration of every man who 
iv. J 

vvifhes to examine with attention the principles 

of that very important fcience. Though in re- 
prefenting the labour which is employed upon 
land as the only productive labour, the notions 
which it inculcates are perhaps too narrow and 
confined ; yet in reprefenting the wealth of na- 
tions as confiding, not in th^ unconfumable riches 
of money, but in the confumable .goods annually 
reproduced by the labour of the fociety ; and in 
reprefenting perfect liberty as the only effectual 
expedient for rendering this annual reproduction 
the greateft poffible, its doctrine feems to be in 
every refpect as juil as it is generous and liberal. 
Its followers are very numerous ; and as men are 
fond of paradoxes, and of appearing to under- 
ftand what furpalfes the compreheniion of ordi- 
nary people, the paradox which it maintains, 
concerning the unproductive nature of manu- 
facturing labour, has not perhaps contributed a 
little to increafe the number of its admirers. 
They have for fome years paft made a pretty 
confiderable feet, diftinguifhed in the French re- 
public of letters by the name of, The CEcono- 
miits. Their works have certainly been of fome 
fervice to their country ; not only by bringing 
into general clifcuffion, many fubjects which had 
never been well examined before, but by influ- 
encing in fome meafure 'the public admimftra- 
tion in favour -of agriculture. It has been in 
confequence of their reprefentations, according- 
ly, that the agriculture of France has been de- 
livered from feveral of the oppreflions which it 

before 



THE WEALTH OF NATIONS. 29 

before laboured under. The term during which CHAP. 
fuch a leafe can be granted, as will be valid 
againft every future purchafer or proprietor of 
the land, has been prolonged from nine to twenty- 
feven years. The antient provincial reftraints upon 
the tranfportation of corn from one province of 
the kingdom to another, have been entirely taken 
away, and the liberty of exporting it to all fo- 
reign countries, has been eftablifhed as the com- 
mon law of the kingdom in all ordinary cafes. 
This feet, in their works, which are, very nume- 
rous,' and which treat not only of what is pro- 
perly called Political CEconomy, or of the na- 
ture and caufes of the wealth of nations, but of 
every other branch of the fyflem of 'civil go- 
vernment, all follow implicitly, and without any 
fenfible variation, the doctrine of Mr. Quefnai. 
There is upon this account little variety in. the 
greater part of their works. The mod diflincl: 
and beft connected account of this doctrine is to 
be found in a little book written by Mr. Mercier, 
de la Riviere, fome time intendant of Martinico, 
in titled, The natural and efiential Order of Po- 
litical Societies. The admiration of this whole 
iect for their mafter, who was himfelf a man of 
the greatefl modefty and Simplicity, is not infe- 
rior to that of any of the antient philofophers 
for the founders of their refpective fy Items. 
" There have been, fmce the world began,' 3 fays 
a very diligent and refpectable author, the Mar- 
quis de Mirabeau, " three great inventions 
" which have principally given (lability to po- 
" litical focieties, independent of many other in- 
4 ** ventions 





THE NATURE AND CAUSES OF 

" ventions which have enriched and adorned 
" them. The firft, is the ^invention of writing, 
66 which alone gives human nature the power of 
" tranfmitting^ without alteration, its laws, its 
* contracts, its annals, and its difcoveries. The 
" fecond, is the invention of money, which binds 
" together all the relations between civilized fo- 
<c cieties. The third, is the (Economical Table* 
tc the refult of the other two, which completes 
" them both by perfecting their object ; the great 
" difcovery of our age, but of which our pofte- 
" rity will reap the benefit." 

As the political ceconomy of the nations of 
modern Europe has been more favourable to' 
manufactures and foreign trade, the induftry of 
the towns, than to agriculture, the induftry of the 
country ; fo that of other nations has followed a 
different plan, and has been more favourable to 
agriculture than to manufactures and foreign 
trade. 

THE policy of China favours agriculture more 
than all other employments* In China, the con- 
dition of a labourer is faid to be as much fupe- 
rior to that of an artificer, as in moft parts of 
Europe that of an artificer is to that of a la- 
bourer. In China, the great ambition of every 
man is to get poffeffion of fome little bit of land, 
either in property or in leafe ; and leafes are there 
faid to be granted upon very moderate terms, and 
to be fufHciently feeured to the leflees. The Chi- 
nefe have little refpecl for foreign trade. Your 
beggarly commerce ! was the language in which 
the Mandarins of Pekin ufed to talk to Mr. 
9 De 



THE WEALTH OF NATIONS. 3 1 

De Lange, the Ruffian envoy, concerning it *, c H A P 
Except with Japan, the Chinefe carry on, them- 
felves, and in their own bottoms, little or no fo- 
reign trade ; and it is only into one or two ports 
of their kingdom that they even admit the mips 
of foreign nations. Foreign trade, therefore, is, 
in China, every way confined within a much nar- 
rower circle than that to which it would natu- 
rally extend itfelf, if more fre<idjpm was allowed to 
it, % either in their own mips, o* in thofe of foreign 
nations. 

MANUFACTURES, as in a fmall bulk they fre- 
quently contain a great value, and can upon that 
account be tranfported at lefs expence from one 
country to another than moft parts of rude pro- 
duce, are, in almoft all countries, the principal 
fupport of foreign trade. In countries, befides, 
lefs extenfive and lefs favourably circumftanced 
for interior commerce than China, they generally 
require the fupport of foreign trade. Without 
an extenfive foreign market, they could not well 
fiourifh, either in countries fo moderately exten- 
five as to afford but a narrow home market ; or 
in countries where the communication between 
one province and another was fo difficult, as to 
render it impoffible for the goods of any parti- 
cular place to enjoy the whole of that home 
market which the country could afford. The 
perfe&ion of manufacturing induftry, it mufl be 
remembered, depends altogether upon the divi- 
fion of labour ; and the degree to which the di- 

See the Journal of Mr. De Lange in Bell's Travels, 
vol. ii. p. 258. 276. and 293. 

vifion 




TrfE NATURE AND CAUSES OF 

vifion of labour can be introduced into any ma* 
nufacture, is necefiarily regulated, it has already 
been fhown, by the extent of the market. But 
the great extent of the empire of China, the vaft 
multitude of its inhabitants, the variety of cli- 
mate, and confequently of productions in its dif- 
ferent provinces, and the eafy communication by 
means of water carriage between the greater part 
of them, render tl?e home market of that country 
of fo great extent,* fcs to be alone fufficient to fup- 
port very great manufactures, and to admit of 
very confiderable fubdivifions of labour. The 
home market of China is, perhaps, in extent, not 
much inferior to the market of all the different 
countries of Europe put together. A more ex- 
.tenfive foreign trade, however, which to this great 
home market added the foreign market of all the 
reft of the world; efpecially if any confiderable 
part of this trade was carried on in Chinefe (hips ; 
could fcarce fail to increafe very much the ma* 
nufacture.s of China, and to improve very much 
the productive powers of its manufacturing in- 
duftry. By a more extenfive navigation, the Chi- 
nefe would naturally learn the art of ufing and 
conftructing themfelves all the different machines 
made ufe of in other countries, as well as the 
other improvements of art and induftry which 
are practifed in all the different parts of the 
world. Upon their prefent plan they have little 
opportunity of improving themfelves by the ex- 
ample of any other nation 5 except that of the 
Japanefe. 

THE policy of antient Egypt too, and that of 
the Gentoo government of Indoftan, feem to have 
1 favoured 



THE WEALTH OF NATIONS. .53 

favoured agriculture more than all other employ- CHAP. 
ments. 



in antient Egypt and Indoftan, -the 
.whole body .of the people was divided into dif- 
ferent cafts or tribes, each of which was confined, 
,from .father to fon, to a particular . employment 
or clafs of employments. The fon of 3. prieft 
avas neceiTarily a prieft ; the fon of a foldier, a 
foldier ; the fon of a labourer, a labourer ; the 
fon of a weaver, a weaver ; the fon of a taylor, 
a taylor ; &c. In both countries, the caft of the 
priefts held the higheft rank, and that of the fol- 
diers the next ; and in both countries,- the caft of 
the farmers and labourers was fuperior to the cafls 
of merchants and manufacturers. 

THE government of both countries was parti- 
cularly attentive to the intereft of agriculture* 
The works conftrucled by the antient fovereigns 
of Egypt for the proper diilribution of the wa- 
ters of the Nile were famous in antiquity ; and 
the ruined remains of fome of them are (till the 
admiration of travellers. Thofe of the fame 
kind which were conftrucled by the antient fo- 
vereigns of Indoftan, for the proper diftribution 
of the waters of the Ganges as well as of many 
other rivers, though 'they have been lefs cele- 
brated, feem to have been equally great. Both 
countries, accordingly, though fubjecl occafion- 
ally to dearths, have been famous for their great 
fertility. Though both were, .extremely popu- 
lous, yet, in years of moderate plenty, they were 
both able to export great quantities, of grain tp 
their neighbours. 

VOJL. in. D THE 




34 *HE NATURE AND CAUSES OF 

THE antient Egyptians had a fuperftitious 
averfion to the fea ; and as the Gentoo religion 
does not permit its followers to light a fire, nor 
confequently to drefs any victuals upon the wa- 
ter, it in effect prohibits them from all diftant 
fea voyages. Both 'the Egyptians and Indians 
mufl have depended almoft altogether upon the 
navigation of other nations for the exportation 
of their furplus produce ; and this dependency, 
as it mud have confined the market, fo it mufl: 
have difcouraged the increafe of this furplus pro- 
duce. It mufl have difcouraged too the increafe 
of the manufactured produce more than that of 
the rude produce. Manufactures require a much 
more extenfive market than the moft important 
parts of the rude produce of the land. A fmgle 
ihoemaker will make more than three hundred 
pairs of fhoes in the year ; and his own family 
will not perhaps wear out fix pairs. Unlefs 
therefore he has the cuftom of at lead fifty fuch 
families as his own, he cannot difpofe of the 
whole produce of his own labour. The moft 
numerous clafs of artificers will feldom, in a large 
country, make more than one in fifty or one in a 
hundred of the whole number of families con* 
tained in it. But in fuch large countries as 
France and England, the number of people em- 
ployed in agriculture has by fome authors beea 
computed at a half, by others at a third, and by 
no author that I know o at lefs than a fifth of 
the whole inhabitants of the country. But as 
the produce of the agriculture of both France 
and England is, the far greater part of it, con- 
fumed 



THE WEALTH OF NATIONS. 3-j 

fumed at home, each perfon employed in it mu'ft, CHAP. 
according to thefe computations, require little 
more than the cuftom of one, two, or$ at moft, 
of four fuch families as his own, in order to dif- 
pofe of the whole produce of his own labour* 
Agriculture, therefore, can fupport itfelf under 
the difcouragement of a confined market, much 
better than manufacturers. In both antient Egypt 
and Indoftan, indeed, the confinement of the 
foreign market was in fome meafure compenfated 
by the conveniency of many inland navigations* 
which opened, in the moft advantageous manner, 
the whole extent of the home market to every 
part of the produce of every different diftricl of 
thole countries. The great extent of Indoftart 
too rendered the home market of that country 
very great, and fufficient to fupport a great va- 
riety of manufactures. But the fmall extent of 
antient Egypt, which was never equal to Eng- 
land, muft at all times have rendered the home 
market of that country too narrow for fupport- 
ing any great variety of manufactures. Bengal* 
accordingly, the province of Indoftan which 
commonly exports the greateft quantity of rice, 
lias always been more remarkable for the 
exportation of a great variety of manufactures, 
than for that of its grain- Antient Egypt, on the 
contrary, though it exported fome manufactures* 
fine linen in particular, as well as fome other 
gpods, was always moft diftinguifhed for its great 
exportation of grain. It was long the granary of 
the Roman empire. 

* THE 




THE NATURE AND CAUSES OF 

THE fovereigns of China, of antient Egypt, 
and of the different kingdoms into which In- 
doftan has at different times been divided, have 
always derived the .whole, or by far the mod 
confiderable part, of their revenue from fome fort 
of land-tax of land-rent. This land-tax or land- 
rent, like the tithe in Europe, confifted in a cer- 
-tain proportion, a fifth, it is faid, of the produce 
of the land, which was either delivered in kind, 
or paid in money, according to a certain valua- 
tion, and which therefore varied from year to 
year according to all the variations of the pro- 
duce. It was natural, therefore, that the fove- 
reigns of thofe countries, fliould be particularly 
attentive to the interefls of agriculture, upon the 
profperity or declenfion of which immediately de- 
pended the yearly inoreafe or diminution of their 
own revenue. 

THE policy of the antknt republics of Greece, 
and that of Rome, though it honoured agricul- 
ture more than manufactures or foreign trade, 
yet feems rather to have difcouraged the latter 
employments, than to have given any direct or 
intentional encouragement to the former. In 
feveral of the antient dates -of Greece, foreign 
trade was prohibited altogether ; and in feverai 
others the employments of artificers and ma- 
nufacturers were confidered as hurtful to the 
ftrength and agility of the human body, as ren- 
dering it incapable of thofe habits which their 
military and gymnaftic exercifes endeavoured to 
form in it, and as thereby difqualifying it more 

or 



THE WEALTH OF NATIONS. - 

or lefs for undergoing the fatigues and encoun- 
tering the dangers of war. Such occupations 
were confidered as fit only for flaves, and the free 
citizens of the ftate were prohibited from exercifmg 
them. Even in thofe ftates where no fuch prp- 
hibition took place, as in Rome and Athens, the 
great body cf the people were in effect excluded 
from all the trades which are now commonly exer- 
cifed by the lower fort of the inhabitants of towns. 
Such trades were, at Athens and Rome, all oc- 
cupied by the Haves of the rich, who exercifed 
them for the benefit of their matters, whofe wealth, 
power, and protection, made it almoft impoflible 
for a poor freeman to find a market for his work, 
when it came into competition with that of the 
flaves of the 'rich. Slaves, however, are very fel- 
dom inventive ; an,d all the mod important im* 
provements, either in machinery, or in the arrange- 
ment and distribution of work, which facilitate and 
abridge labour, have been the difcoveries of free- 
men. Should a flave propofe any improvement 
of this kind, his matter would be very apt to con? 
fider the propofal as the fuggettion of lazinefs, and 
of a defire to fave his own labour at the matter's 
expence. The poor (lave, .mtteacl of reward, 
would probably meet with much abufe, perhaps 
with fome punifliment. In the manufactures 
carried on by Haves, therefore, more labour muft 
generally have been employed to execute the 
fame quantity of work, than in thofe carried on 
by freemen. The work of the 'former rnutt, 
upon that account, generally have been dearer 
D 3 than 





38 THE NATURE AND CAUSES OF 

B o^o K than that of the latter. The Hungarian mines, 
it is remarked by Mr. Montefquieu, though not 
richer, have always been wrought with lefs expence, 
and therefore with more profit, than the Turkifh 
mines in their neighbourhood. The Turkifh mines 
are wrought by flaves ; and the arms of thofe 
flaves are the only machines which the Turks have 
ever thought of employing. The Hungarian 
mines are wrought by freemen, who employ a great 
deal of machinery, by which they facilitate and 
abridge their own labour. From the very little 
that is known about the price of manufactures in 
the times of the Greeks and Romans, it would 
appear that thofe of the finer fort were exceffively 
(dear. Silk fold for its weight in gold. It was 
not, indeed, in thofe times a European manufac- 
ture ; and as it was, all brought from the Eafl 
Indies, the diftance of the carriage may in fome 
meafure account for the greatnefs of the price. 
The price, however, which a lady, it is faid, would 
fometimes pay for a piece of very fine linen, feems 
to have been equally extravagant ; and as linen was 
always either an European, or, at fartheft, an 
Egyptian manufacture, this high price can be ac- 
counted for only by the great expence of the la- 
bour which mufl have been employed about it, 
and the expence of this labour again could arife 
from nothing but the awkwardnefs of the ma-* 
chinery which it made ufe of. The price of fine 
^oollens too, though not quite fo extravagant, 
feems however to have been much above that of 
the prefent times. Some cloths, we are told by 

Pliny, 



THE WEALTH OF NATIONS. 39 

Pliny, dyed in a particular manner, cod a hundred CHAP. 
denarii, or three pounds fix fhillings and eight 
pence the pound weight*. Others dyed in an- 
other manner cod a thoufand denarii the pound 
weight, or thirty-three pounds fix fhillings and 
eight pence. The Roman pound, it muft be re- 
membered, contained only twelve of our avoirdu- 
pois ounces. This high price, indeed, feems to 
have been principally owing to the dye. But had 
not the cloths themfelves been much dearer than 
any which are made in the prefent times, fo very 
expenfive a dye would not probably have been 
beftowed upon them. The difproportion would 
have been too great between the value of the 
acceflory and that of the principal. The price 
mentioned by the fame t author of fome Tri^li- 
naria, a fort of woollen pillows or cufhions made 
ufe of to lean upon as they reclined upon their 
couches at table, pafles all credibility ; fome of 
them being faid to have cod more than thirty 
thoufand, others more than three hundred thoufand 
pounds. This high price too is not faid to have 
arifen from the dye. In the drefs of the people of 
fafhion of both fexes, there feems to have been 
much lefs variety, it is obferved by Dr. Ar- 
buthnot, in antient than in modern times ; and the 
very little variety which \ve find in that of the an- 
tient flatues confirms his obfervation. He infers 
from this, that their drefs muft upon the whole have 
been cheaper than ours ; but the conclufion does 
pot feem to follow. When the expence of fafhion- 

Plin. 1. ix. c. 35, f Plin. 1. viii. c. 48. 

D 4 able 




40 THE NATURE AND CAUSES OF 

able drefs is very great, the variety niuft be very 
fmall. But when, by the improvements in the 
productive powers of manufacturing art and in- 
duftry, the experiee of any one drefs comes to be 
very moderate, the variety will naturally be very 
great. The rich not being able to. diftinguiih 
themfelves by the expence of any one drefs, will 
naturally endeavour to do fo by the multitude and 
variety of their dreffes. 

THE greateft and mod important branch of the 
commerce of every nation, -if has already been ob- 
ferved, is that which is carried on between the in- 
habitants of the town and thofeof the country. The 
inhabitants of the town draiv from the country the 
rude produce which conftitutes both the materials 
of their work and the fund of their fubfiftence ; 
and they pay for this rude produce by fending back 
to the country a certain portion of it manufactured 
and prepared for immediate ufe. The trade which 
is carried on between thefe two different fets of 
people, confiits ultimately in a certain quantity of 
rude produce exchanged for a certain quantity of 
manufactured produce. The dearer the latter, 
therefore, the cheaper the former; and* whatever 
tends in any country to raife the price of manu- 
factured produce, tends .to lower that of the rude 
produce of the land, ^nd thereby to difcourage 
agriculture. The fmaller the quantity of ma- 
nufactured produce w 7 hich any given quantity of 
rude produce,, or, what comes to the fame thing, 
which the price of any given quantity of rude 
produce is capable of purchafmg, the fmaller 
the exchangeable value of that given quantity 

of 



THE WEAftTH OF -NATIONS. 41 

of rude produce ; the fmaller the encouragement CHAP. 
Xvhich either the landlord has to increafe its quan- 
tky by improving, or the farmer by cultivating 
the land. Whatever, befides, tends to diminifh 
in any country the number of artificers and ma- 
nufactures, tends to diininifh the home market, 
the moft important of all markets for the rude 
produce of the land, and thereby ftill further to 
difcourage agriculture. 

THOSE fyftems, therefore, which preferring 
agriculture to all* other employments, in order 
to promote it, impofe reftraints upon manufac- 
tures and foreign trade, act contrary to the very 
end which they propofe, and indirectly difcou- 
rage that very fpecies of induftry which they 
mean to promote. They are fo far, perhaps, 
more inconfiftent than even the mercantile fyftem. 
That fyftem, by encouraging manufactures and 
foreign trade more than agriculture, turns a cer- 
tain portion of the capital of the fociety from- 
fupporting a more advantageous, to fupport a 
lefs advantageous fpecies of induftry. But {till 
it really and in the end encourages that fpecies 
of induftry which it means to promote. Thofe 
agricultural fyftems, on the contrary, really and 
in the end difcourage their own favourite fpecies 
of induftry. 

IT is thus that every fyftem which endeavours, 
either, by extraordinary encouragements, to draw 
towards a particular fpecies of induftry a greater 
fhare of the capital of the fociety than what would 
naturally go to it ; or, by extraordinary reftraints, 
to force from a particular fpecies of induftry fome 
7 mare 




42 THE NATURE ANI> CAUSES OF 

ftare of the capital which would otherwife be 
employed in it ; is in reality fubverfive of the 
great purpofe which it means to promote. It 
retards^ inftead of accelerating, the progrefs of 
the fociety towards real wealth and greatnefs ; and 
diminiihes, inflead of increafing, the real value of 
the annual produce of its land and labour. 

ALL fyftems either of preference or of reflraint, 
therefore, being thus completely taken away, the 
obvious and fimple fyftem of natural liberty efta- 
blifhes itfelf of its own accord* Every man, as 
long as he does not violate the laws of juflice, is 
left perfectly free to purfue his own interefl his 
own way, and to bring both his induflry and capi- 
tal into competition with thofe of any other man 5 
or order of men. The fovereign is completely 
difcharged from a duty, in the attempting to per- 
form which he muft always be expofed to innu- 
merable delufions, and for the proper performance 
of which no human wifdom er knowledge could 
ever be fufficient ; the duty of fuperintending the 
indudry of private people, and of directing it 
towards the employments moft fuitable to the in- 
tereft of the fociety. According to the fyftem of 
natural liberty, the fovereign has only three duties 
to attend to; three duties of great importance, 
indeed, but plain and intelligible to common un- 
derftandings ; firit, the duty of protecting the fo- 
ciety from the violence and invafion of other in- 
dependent focieties ; fecondly, the duty of pro- 
tecting, as far as poflible, every member of the 
Hfociety from the injuftjge or oppreflion of every 
other member of it, or the duty of eflablilhing 




THE WEALTH OF NATIONS, 45 

an exat adminiftration of juftice ; and, thirdly, c 
the duty of ere&ing and maintaining certain pub- 
lic works and certain public inflitutions, which 
it can never be for the interefl of any individual, 
or finall number of individuals, to erect and main- 
tain ; becaufe the profit could never repay the ex- 
pence to any individual or fmall number of indi- 
viduals, though it may frequently do much more 
than repay it to a great fociety. 

THE proper performance of thofe feveral duties 
of the fovereign neceflarily fuppofes a certain ex- 
pence ; and this expence again neceflarily requires 
a certain revenue to fupport it. In the following 
book, therefore, I mail endeavour to explain ; firft, 
what are the neceflary expences of the fovereign 
or commonwealth ; and which of thofe expences 
ought to be defrayed by the general contribution 
of the whole fociety ; and which of them, by that 
of fome particular part only, or of fome particular 
members of the fociety : fecondly, what are the 
different methods in which the whole fociety may 
be made to contribute towards defraying the ex- 
pences incumbent on the whole fociety, and what 
are the principal advantages and inconveniencies 
of each of thofe methods : and, thirdly, what are 
the reafons and caufes which have induced almofl 
all modern governments to mortgage fome part 
of this revenue, or to contract debts, and what 
have been the effects of thofe debts upon the real 
wealth, the annual produce of the land and labour 
of the fociety. The following book, therefore, 
naturally be divided intfc three chapters. 



THE NATURE AND CAUSES OF , 



' B O Q K V. 

Of the Revenue of the Sovereign or Com- 
monwealth. 



CHAP. I. 

Of the Expences of the Sovereign or Common- 
wealth. 



PART FIRST. 



Of the Expence of Defence. 




duty of the fovereign, that of 
protecting the fociety from the violence 
and invafion of other independent focieties, can 
be performed only by means of a military force. 
But the expence both of preparing this military 
force in time of peace, and of employing it in 
time of war, is very different in the different 
flates of fociety, in the different periods of im- 
provement. 

AMONG nations of hunters, the lowefl and 
rudeft ftate of fociety, fuch as we find it among 
the native tribes of North America, every man 
is a warrior as well as a hunter. When he goes 
to war, either to defend his fociety, or to revenge 
the injuries which have been done to it by other 
focieties, he maintain himfelf Jby his own labour, 

in 



THE WEALTH OF NATIONS. 45 

m the fame manner as when he liv.es at home. CHAP. 
His fociety, for in this fb-te of things there is 
properly neither fovereign nor commonwealth, is 
at no fort of expence, either to prepare him for 
the field, or to maintain him while he is in it. 

AMONG nations of fhepherds, a more advanced 
ftate of fociety, fuch as we find it among the 
Tartars and Arabs, every man is, in the fame 
manner, a warrior. Such nations have com- 
monly no fixed habitation, but live, either in 
tents, or in a fort of covered waggons which are 
eafily tranfported from place to place. The 
whole tribe or nation changes its fituation ac- 
cording to the different feafons of the year, as 
well as according to other accidents. When its 
herds and flocks have confumed the forage of 
one part of the country, it removes to another, 
and from that to a tkird. In the dry feafon, it 
comes down to the banks of the rivers; in the 
wet feafon it retires to the -upper country. When 
fuch a nation goes to war, the warriors will not 
truft their herds and flocks to the feeble defence 
of their old men, their women and children, 
and their old men, their women and children, 
will not be left behind without defence and 
without fubfiftence. The whole nation, befides, 
being accuflomed to a wandering life, even in 
time of peace, eafily takes the field in time of 
war. , Whether it marches as an army, or moves 
about as a company of herdfmen, the way of life 
is nearly the fame, though the object propofed 
by it be very different. They all go to war to- 
gether, therefore, and every ,one does as well as 

he 




4$ THE NATURE AND CAUSES OF 

he can. Among the Tartars, even the women 
have been frequently known to engage in battle. 
If they conquer, whatever belongs to the hoflile 
tribe is the recompdnce of the victory. But if 
they are vanquifhed, all is loft, and not only 
their herds and flocks, but their women and chil- 
dren, become the booty of the conqueror. Even 
the greater part of thofe who furvive the adiorr 
are obliged to fubmit to him for the fake of im- 
mediate fubfiftence. The reft are commonly dif- 
fipated and difperfed in the defart. 

THE ordinary life, the ordinary exercifes of a 
Tartar or Arab, prepare him fufficiently for war. 
Running, wreftling, cudgel-playing, throwing 
the javelin, drawing the bow, &c. are the com- 
mon paftimes of thofe who live in the open air, 
and are all of them the images of war. When a 
Tartar or Arab actually goes to war, he is main- 
tained by his own herds and flocks which he car- 
ties with him, in the fame manner as in peace. 
His chief or fovereign, for thofe nations have all 
chiefs or fovereigns, is at no fort of expence in 
preparing him for the field ; and when he is in it, 
the chance of plunder is the only pay which he 
either expects or requires. 

AN army of hunters can feldom exceed two or 
three hundred men. The precarious fubfiftence 
which the chace affords could feldom allow a 
greater number to keep together for any coiv 
fiderable time. An army of fhepherds, on the 
contrary, may fometimes amount to two or three 
hundred thoufand. As long as nothing flops 
their progrds, as long as they can go on from 

one 



THE WEALTH OF NATIONS. 47 

one diflricl, of which they have confumed the c H A p. 
forage, to another which is yet entire ; there 
feems to be fcarce any limit to the number 
who can march on together. A nation of hunters 
can never be formidable to the civilized 'nations 
in their neighbourhood. A nation of fhepherds 
may. Nothing can be more contemptible than 
an Indian war in North America. Nothing, on 
the contrary, can be more dreadful than a Tartar 
invafion has frequently been in Afia. The 
judgment of Thucydides, that both Europe and 
Afia could not refift the Scythians united, has 
been verified by the experience of all ages. The 
inhabitants of the extenfive, but defencelefs 
plains of Scythia or Tartary, have been fre- 
quently united under the dominion of the chief of 
fome conquering horde or clan ; and the ha- 
voc and devaftation of Afia have always lig- 
nalized their union. The inhabitants of the m- 
hofpitable defarts of Arabia, the other great na- 
tion of fhepherds, have never been united but 
once; under Mahomet and his immediate fuc- 
ceflbrs. Their union, which was more the effect 
of religious enthufiafm than of conquefl, was 
fignalized in the fame manner. If the hunting 
nations of America Ihould ever become fhep- 
herds, their neighbourhood would be much more 
dangerous to the European colonies than it is 
at prefent. 

IN a yet more advanced ftate of fociety, among 

thofe nations of huibandmen who have little 

foreign commerce, and no other manufactures 

but thofe coarfe and houfehold ones which almofl 

6 every 



48 THE NATURE AND CAUSES OF 

BOOK every private family prepares for its own ufe; 
every man, in the fame manner, either is a war- 
rior, or eafily becomes fuch. They who live by 
agriculture generally pafs the whole day in the 
open air, expofed to all the inclemencies of the 
feafons. The hardinefs of their ordinary life 
prepares them for the fatigues of war, to fome 
of which tKeir.neceflary occupations bear a great 
analogy. The necelfary occupation of a ditcher 
prepares him to work in the trenches, and to 
fortify a camp as well as to enclofe a field. The 
ordinary paflimes of fuch hufbandmen are the 
fame as ihofe of ihepherds, and are in the fame 
manner the images of war. But as hufbandmen 
Jhave lefs leifure than fhepherds, they are not fo 
frequently employed in thofe paftimes. They are 
foldiers, but foldiers not quite fp much matters 
of their exercife. Such as they are, however, it 
feldom colls the fovereign or commonwealth any 
.expence to prepare them for the field. 

AGRICULTURE, even in its rudeil and loweft 
ftate, fuppofes a fettlement, fome fort of fixed 
habitation which cannot be abandoned without 
great lofs. When a nation of mere hufbandmen,, 
therefore, goes to war, the whole people cannot 
take the field together. The old men, the -wo- 
men and children, at leaft, mult remain at home * 
to take care of the habitation. All the men of 
the military age, however, may take the field* 
and, in fmall nations of this kind, have fre- 
quently done fo. In every nation the men of the 
military age are fuppofed to amount to about a 
fourth or a fifth part of the whole body of the 

people. 



THE WEALTH OF NATIONS. 49 

people. If the campaign too fhould begin after c H^A P. 
feed time, and end before harveft, both the 
hufbandman and his principal labourers can be 
fpared from the farm without much lofs. He 
trufts that the work which mud be done in the 
mean time can be well enough executed by the 
old men, the women, and the children. He is 
not unwilling, therefore, to ferve without pay 
during a fhort campaign, and it frequently cofts 
the fovereign or commonwealth as little to main- 
tain him in the field as to prepare him for it. 
The citizens of all the different dates of antient 
Greece feem to have ferved in this manner till 
after the fecond Perfian war ; and the people of 
Peloponefus till after the Peloponefian war. 
The Peloponefians, Thucydides obferves, gene- 
rally left the field in the fummer, and returned 
home to reap the harveft. The Roman people 
under their kings, and during the firft ages of 
the republic, ferved in the fame manner. It 
was not till the fiege of Veii, that they, who ftaid 
at home, began to contribute fomething towards 
/ maintaining thofe who went to war. In the Eu- 
ropean monarchies, which were founded upon the 
ruins of the Roman empire, both before and for 
fome time after the eftablifhment of what is pro- 
perly called the feudal law, the great lords, with 
all their immediate dependents, ufed to ferve the 
crown at their own expence. In the field, in the 
fame manner as at home, they maintained them- 
felves by their own revenue, and not by any fti- 
pend or pay which they received from the king 
upon that particular occafion, 

- VOL. IIJ. E 




THE NATURE AND CAUSES OF 

IN a more advanced ftate of fociety, two dif- 
ferent caufes contribute to render it altogether 
impoflible that they, who take the field, fhould 
maintain themfelves at their own expence. Thofe 
two caufes are, the progrefs of manufactures, and 
the improvement in the art of war. 

THOUGH a hufbandman ihould be employed, 
in an expedition, provided it begins after feed- 
time and ends before harveft, the interruption 
of his bufinefs will not always occalion any con- 
fiderable diminution of his revenue. Without 
the intervention of his labour, nature does her- 
felf the greater part of the work which remains 
to be done. But the moment that an artificer, 
a fmith, a carpenter, or a weaver, for example, 
quits his workhoufe, the fole fource of his re- 
venue is completely dried up. Nature does no- 
thing for him, he does all for himfelf. When 
he takes the field, therefore, in defence of the 
public, as he has no revenue to maintain himfelf, 
he rnuft neceiTanly be maintained by the public. 
But in a country of which a great part of the in- 
habitants are artificers and manufacturers, a great 
part of the people who go to war muft be drawn 
from thofe clafles, and mufl therefore be main- 
tained by the public as long as they are employed 
in its fervice. 

WHEN the art of war too has gradually grown 
up to be a very intricate and complicated fcience, 
when the event of war ceafes to be determined, 
as in the firfl ages of fociety, by a fingle irregu- 
lar ikirmifh or battle, but when the conteft is 
generally fpun out through feveral different cam- 
paigns* 




THE WEALTH OF NATIONS. 51 

paignS, each of which lads during the greater 
part of the year ; it becomes univerfally necef- 
fary that the public fhould maintain thofe who 
ferve the public in war, at lead while they are 
employed in that fervice. Whatever in time of 
peace might be the ordinary occupation of thofe 
who- go to war, fo very tedious and expenfive a 
fervice would otherwife be by far too heavy a 
burden upon them. After the fecoiid Perfian 
war, accordingly, the armies of Athens feem to 
have been generally compofed of mercenary 
troops, confiding, indeed, partly of citizens, 
but partly too of foreigners ; and all of them, 
equally hired and paid at the expence of the 
flare. From the time of the fiege of Veii, the 
armies of Rome received pay for their fervice 
during the time which they remained in the 
field. Under the feudal governments the mili- 
tary fervice both of the great lords and of their 
immediate dependents was, after a certain period, 
univerfally exchanged for a payment in money, 
which was employed to maintain thofe who ferved 
ih their dead. 

THE number of thofe who can go to war, in 
proportion to the whole number of the people 
is neceflarily -much fmaller in a civilized, than in 
a rude date of fociety. In a civilized fociety, 
as the foldiers are maintained altogether by the 
labour of thofe who are not foldiers, the number 
of the former can never exceed what the latter can 
maintain, over and above maintaining, in a man- 
ner fuitable to their refpeclive dations, both them- 
felves and the other officers of government, and 

E 2 law, 



p THE MATURE AND CAUSES OF 

B o^o K j aw ^ w hom they are obliged to maintain. In the 
little agrarian ftates of antient Greece, a fourth 
or a fifth parth of the whole body of the people 
conlidered themfelves as foldiers, and would fome- 
times, it is faid, take the field. Among the civilized 
nations of modern Europe, it is commonly com- 
puted, that not more than one hundredth part of 
the inhabitants of any country can be employed as 
foldiers, without ruin to the country which pays 
the expence of their fervice. 

THE expence of preparing the army for the 
field feems not to have become confiderable in 
any nation, till long after that of maintaining it 
in the field had devolved entirely upon the fove- 
reign or common-wealth. In all the different re- 
publics of antient Greece, to learn his military 
exercifes, was a neceffary part of education im- 
pofed by the (late upon every free citizen. In 
every city there feems to have been a public 
field, in which, under the protection of the pub- 
lic magiftrate, the young people were taught 
their different exercifes by different matters. In 
this very fimple inftitution, confided the whole 
expence which any Grecian flate feems ever to 
have been at, in preparing its citizens for war. 
In antient Rome the exercifes of the Campus 
Martius anfwered the fame purpofe with thofe 
of the Gymnafium in antient Greece. -Under 
the feudal governments, the many public ordk 
nances that the citizens of every diftrict mould 
practife archery as well as feveral other military 
exercifes, were intended for promoting tl*e fame 
purpofe, but do not feem to have promoted it fo 

well. 



THE WEALTH OF NATIONS. 53 

well. Either from want of interefl in the officers CHAP. 

entrufted with the execution of thofe ordinances, 

or from fome other caufe, they appear to have 

been univerfally neglected ; and in the progrefs of 

all tfcofe governments, military exercifes feem to 

have goce gradually into difufe among the great 

body of the people. 

IN the republics of amient Greece and Rome, 
during the whole period of their exiftence, and 
under the feudal governments for a confiderable 
time after their firft eftablilhment, the trade of 
a foldier was not a feparate, diftinct trade, which 
conftituted the fole or principal occupation of a 
particular clafs of citizens. Every fubjedt of the 
ftate, whatever might be the ordinary trade or 
occupation by. which he gained his livelihood, 
confidered himfelf, upon all ordinary occaiions, 
as fit likewife to exercife the trade of a foldier, 
and upon many extraordinary occafions as bound 
to exercife it. 

THE art of war, however, as it is certainly the 
nobleft of all arts, fo in the progrefs of improve- 
ment it neceiTarily becomes one of the mod 
complicated among them. The flate of the me- 
chanical, as well as of fome other arts, with which 
it is neceflarily connected, determines the degree 
of perfection to which it is capable of being 
carried at any particular time. But in order to 
carry it to this degree of perfection, it is necef- 
fary that it mould become the fole or principal 
occupation of a particular clafs of citizens, and 
the divifion of labour is as necelTary for the im- 
provement of this, as of every other art. Into 

r. 3 other 



54 THE NATURE AND CAUSES OF 

BOOK other arts the divifion of labour is naturally in-* 
troduced by the prudence of individuals, who 
find that they promote their private intereft bet- 
ter by confining themfelves to a particular trade, 
than by exercifing a great number. But it is the 
wifdom of the ftate only which can render the 
trade of a foldier a particular trade feparate and 
diftinct from all others. A private citizen, who 
in time of profound peace a and without any par- 
ticular encouragement from the public, mould 
fpend the greater part of his time in military ex- 
ercifes, might, no doubt, both improve himfelf 
very much in them, and amufe himfelf very well ; 
but he certainly would not promote his own in- 
tereft. It is the wifdom of the ftate only which 
can render it for his intereft to give up the greater 
part of his time to this peculiar occupation : and 
ftates have not always had this wifdom, even 
when their circumftances had become fuch, that 
the prefervation of their exiftence required that 
they mould have it. 

A SHEPHERD has a greacj'deal of leifpre ; a huf- 
bandman, in the rude uate of hufbandry, has 
fome ; an artificer or manufacturer has none at 
all. The firft may, without aiiy lofs employ a 
great deal of his time in martial exercifes ; the 
fecond may employ fome part of it ; but the laft 
cannot employ a fingle hour in them without 
ibme lofs ; and his attention to his own intereft 
naturally leads him to neglect them altogether* 
Thofe improvements in hufbandry too, which the 
jirogrefs of arts and manufactures neceflarily iri- 
froduces 5 leave the hufbandman as little leifure 



THE WEALTH OF NATIONS. 55. 

as the artificer. Military exercifes come to be c H J A p - 
as much neglected by^the inhabitants of the coun- 
try as by thofe of the town, and the great body of 
the people becomes altogether unwarlike. That 
wealth, at the fame time, which always follows 
the improvements of agriculture and manufactures, 
and which in reality is no more than the accumu- 
lated produce of thofe improvements, provokes 
the invafion of all their neighbours. An induftrl- 
ous, and upon that account a wealthy nation, is 
of all nations the mod likely to be attacked ; and 
unlefs the flate takes fome new meafures for the 
public defence, the natural habits of the people 
render them altogether incapable of defending 
themfelves. 

IN thefe circumftances, there feem to be but 
two methods by which the (late can make any 
tolerable provifion for the public defence. 

IT may either, firft, by means of a very rigor- 
ous police, and in fpite of the whole bent of the 
intereft, genius and inclinations of the people, en* 
force the practice of military exercifes, and oblige 
either all the citizens of the military age, or a cer- 
tain number of them, to join in fome meafure the 
trade of a foldier to whatever other trade or pro- 
feflion they may happen to carry on. 

OR, fecondly, by maintaining and employing a 
certain number of citizens in the conftant practice 
of military exercifes, it may render the trade of a 
foldier a particular trade, feparate and diftinft from 
all others. 

IF the ftate has recourfe to the firft of thofe 
two expedients, its military force is faid. to con- 

E 4 fift 



5<$ THE NATURE AND CAUSES OF 

B o^o K fift i n a militia; if to the fecond, it is faid to 
confiil in a (landing army. The practice of mi- 
litary exercifes h the fole or principal occupa- 
tion of the foldiers of a ftanding army, and the 
maintenance or pay which the ilate affords them 
is the principal and ordinary fund of their fub- 
fiftence. The practice of military exercifes i$ 
only the occafional occupation of the foldiers of 
a militia, and they derive the principal and or- 
dinary fund of their fubfiftence from fome other 
occupation. In a militia, the character of tfie 
labourer, artificer, or tradefman, predominates 
over that of the foldier : in a ftanding army, that 
of the foldier predominates over every other cha- 
racter ; and in this diftinction feems to confift the 
effential difference between thole two different 
fpecies of military force, 

MILITIAS have been of feveral different kinds* 
In fome countries the citizens deftined for de- 
fending the Hate, feem to have been exercifed 
only, without being, if I may fay fo, tegimented; 
that is, without being divided into feparate and 
diftinct bodies of troops, each of which per- 
formed its exercifes under its own proper and per- 
manent officers. In the republics of antient 
Greece and Rome, each citizen, as long as he 
remained at home, feems to have practifed his 
exercifes either feparately and independently, or 
with fuch of his equals as he liked befl : and not 
to have been attached to any particular body of 
troops till he was actually called upon to , take 
the field. In other countries, the militia has not 
pnly been exercifed, -but regimented. , In Eng-, 

land. 



THE WEALTH OF NATIONS. $7 

land, in Switzerland, and, I believe, in every CHAP. 
other country of modern Europe, where any im- 
perfect military force of this kind has been efta* 
blilhed, every militia man is, even in time of 
peace, attached to a particular body of troops, 
which performs its exercifes under its own proper 
and permanent officers. 

BEFORE the invention of fire arms, that army 
was fuperior in which the foldiers had, each in- 
dividually, the greatefl fkill and dexterity in the 
ufe of their arms. Strength and agility of body 
were of the higheft confequence, and commonly 
determined the fate of battles. But this fkill 
and dexterity in the ufe of their arms, could be 
acquired only, in the fame manner as fencing is 
at prefent, by practifing, not in great bodies, but 
each man feparately, in a particular fchool, under 
a particular matter, or with his own particular 
equals and companions. Since the invention of 
fire-arms, fbrength and agility of body, or even 
extraordinary dexterity and fkill in the ufe of 
arms, though they are far from being of no 
confequence, are, however, of lefs confequence. 
The nature of the weapon, though it by no 
means puts the awkward upon a level with the 
fkilful, puts him more nearly fo than he ever 
was before. All the dexterity and fkill, it is 
fuppofed, which are neceflary for ufing it, can 
be well enough acquired by pra&ifmg in great 
bodies. 

REGULARITY, order, and prompt obedience to 
command, are qualities which, in modern armies, 
are of more importance towards determining the 

fate 



58 THE NATURE AND CAUSES OF 

BOOK fate of battels, than the dexterity and (kill of 
the foldiers in the ufe of their arms. But the 
noife of fire-arms, the frnoke, and the invifible 
death to which every man feels himfelf every 
moment expofed, as foon as he comes within 
cannon-mot, and frequently a long time before 
the battle can be well faid to be engaged, mud 
render it very difficult to maintain any confider- 
able degree of this regularity, order, and prompt 
obedience, even in the beginning of a modern 
battle. In an antient battle there was no noife 
but what arofe from the human voice ; there was 
no fmoke, there was no invifible caufe of wounds 
or death. Every man, till fome mortal weapon 
actually did approach him, faw clearly that no 
fuch weapon was near him. In thefe circum* 
fiances, and among troops who had fome confi- 
dence in their own {kill and dexterity in the ufe 
of their arms, it muft have been a good deal lefs 
difficult to preferve fome degree of regularity and 
order, not only in the beginning, but through the 
-whole progrefs of an antient battle, and till one of 
the two armies was fairly defeated. But the habits 
of regularity, order, and prompt obedience to com- 
mand, can be acquired only by troops which are 
exercifed in great bodies. 

A MILITIA, however, in whatever manner it 
may be either difciplined or exercifed, muft al- 
ways , be much inferior to a well-difciplined and 
\veli-exercifed Handing army. 

THE foldiers, who are exercifed only once a 
week, or once a month, can never be fo expert 
in the ufe of their arms, as thofe who are exer- 

cifecj 



THE WEALTH OF NATIONS. 59 

cifed every day or every other day ; and though CHAP. 
this circumftance may not be of fo much confe- 
quence in modern, as it was in antient times, 
yet the acknowledged fuperiority of the PruiTian 
troops, owing, it is laid, very much to their fupe- 
rior expertnefs in their exercife, may fatisfy us 
that it is, even at this day, of very confiderable 
confequence. 

THE foldiers, who are bound to obey their of- 
ficer only once a week or once a month, and who 
are at all other times at liberty to manage their 
own affairs their own way, without being in any 
refpect accountable to him, can never be under 
the fame awe in his prefence, can never have the 
fame difpofition to ready obedience, with thofe 
whofe whole life and conduct are every day di- 
rected by him, and who every day even rife and 
go to bed, or at lead retire to their quarters, ac- 
cording to his orders. In what is called difci- 
pline, or in the habit of ready obedience, a militia 
mufl always be (till more inferior to a ftanding 
army, than it may fometimes be in what is called 
the manual exercife, or in the management and 
ufe of its arms. But in modern war the habit 
of ready and inftant obedience is of much greater 
confequence than a confiderable fuperiority in the 
management of arms. 

THOSE militias which, like the Tartar or Arab 
militia, go to war under the fame chieftains whom 
they are accuftomed to obey in peace, are by far 
the bed. In refpect for their officers, in the ha- 
bit of ready obedience, they approach neareft to 
ftanding armies. The highland militia, when it 

ferved 



6o THE NATURE AND CAUSES OF 

B o^o K. f erve d under its own chieftains, had fome ad- 
vantage of the fame kind. As the highlanders, 
however, were not wandering, but (lationary fhep- 
herds, as they had all a fixed habitation, and were 
not, in peaceable times, accuflomed to follow 
their chieftain from place to place; fo in time 
of war they were lefs willing to follow him to 
any confiderable diilance, or to continue for any 
long time in the field. When they had acquired 
any booty they were eager to return home, and his 
authority was feldom fufficient to detain them. In 
point of obedience they were always much inferior 
to what is reported of the Tartars and Arabs. As 
the highlanders too, from their fl^tionary life, 
fpend lefit of their time in the open air, they were 
always lefs accuflomed to military exercifes, an4 
were lefs expert in the ufe of their arms than the 
Tartars and Arabs are faid to be, 

A MILITIA of any kind, it muft be obferved, 
however, which has ferved for feveral fucceffive 
campaigns in the field, becomes in every refpect 
a (landing army. The foldiers are every day ex- 
ercifed in the ufe of their arms, and, being con* 
ftantly under the command of their officers, are 
habituated to the fame prompt obedience which 
takes place in (landing armies. What they were 
before they took the field, is of little import- 
ance. They neceflarily become in every refpecl 
a (landing army, after they have pafled a few 
campaigns in it. Should the war in America 
drag out through another campaign, the Ameri- 
can militia may become in every refpecl: a match 
for that (landing army of which the valour ap- 
15 peare-d, 



'THE WEALTH O? NATIONS. to 

peared, in the laft war, at leaft not inferior to that c "^ F - 
of the har elicit veterans of France and Spain. 

THIS di(lintion being well understood, the 
hiftory of all ages, it will be found, be'ars tefti- 
mony to the irrefiftible fuperiority which a well- 
regulated (landing army has over a militia. 

ONE of the firft (landing armies of which we 
have any diftinct account, in any well authen- 
ticated hiftory, is that of Philip of Macedon. 
His frequent wars with the Thracians, Illyrians, 
Theffalians, and fome of the Greek cities in the 
neighbourhood of Macedon, gradually formed 
his troops, which in the beginning were probably 
militia, to the exacl: difcipline of a (landing army. 
When he was at peace, which he was very fel- 
dom, and never for any long time together, he 
was careful not to di(band that army. It van- 
quimed and fubdued, after a long and violent 
ftruggle, indeed, the gallant and well-exercifed 
militias of the principal republics of antient 
Greece ; and afterwards, with very little druggie, 
the effeminate and ill-exercifed militia of the 
great Perfian empire. The fall of the Greek re- 
publics and of the Perfian empire, was the ef- 
fect of the irrefiftible fuperiority which a (land- 
ing army has over every fort of militia. It is 
the firft great revolution in the affairs of man- 
kind, of whkh hiftory has preferved any diftinft 
or circumftantial account. 

THE fall of Carthage, and the confequent ele- 
vation of Rome, is the fecond. All the varie- 
ties in the fortune of thofe two famous repub- 
lics may very well be accounted for from the 
fame caufe. 

FROM 




THE NATURE AND CAUSES OF 

FROM the end of the firfl to the beginning of 
the fecond Carthaginian war, the armies of Car- 
thage were continually in the field, and employed 
under three great generals, who fucceeded one 
another in the command ; Amilcar, his fon-in- 
law Afdrubal, and his fon Annibal ; firfl in chaf- 
tifing their own rebellious flaves, afterwards in 
fubduing the revolted nations of Africa, and 
laftly, in conquering the great kingdom of Spain. 
The army which Annibal led from Spain into 
Italy muft necefiarily, in thofe different wars, 
have been gradually formed to the exact difci- 
pline of a flanding army. The Romans, in the 
mean time, though they had not been altogether 
at, peace, yet they had not, during this period, 
been engaged in any war of very great confe- 
quence ; and their military difcipline, it is gene- 
rally faid, was a good deal relaxed. The Roman 
armies which Annibal encountered at Trebia, 
Thrafymenus and Cannse, were militia oppofed 
to a flanding army. This circumflance, it is 
probable, contributed more than any other to 
determine the fate of thofe battles. 

THE fianding army which Annibal left behind 
him in Spain, had the like fuperiority over the 
militia which the Romans fent to oppofe it, and 
in a few years, under the command of his brother, 
the younger Afdrubal, expelled them almoft en- 
tirely from thai country. 

. ANNIBAL was ill fupplied from home. The 
Roman militia, being continually in the field, 
became in the progrefs of the war a well-difci- 
plined and well-exercifed flanding army \ and the 
fuperiority of Annibal grew every day lefs and 

lefs. 



THE WEALTH OF NATIONS. 63 

lefs. Afdrubal judged it neceflary to lead the CHAP. 
whole, or almoft the whole of the ftanding army 
which he commanded in Spain, to the ailiftance 
of his brother in Italy. In this march he is faid 
to have been milled by his guides ; and in a 
country which he did not know, was furprifed 
and attacked by another ftanding army, in every 
refpecl: equal or fuperior to his own, and was en- 
tirely defeated. 

WHEN Afdrubal had left Spain, the great Scipio 
found nothing to oppofe him but a militia inferior 
to his own. He conquered and fubdued that mi- 
litia, and, in the courfe of the war, his own mili- 
tia neceflarily became a well-difciplined and well- 
exercifed ftanding army. That ftanding army 
was afterwards carried to Africa, where it found 
nothing but a militia to oppofe it. In order to 
defend Carthage it became neceifary to recall the 
ftanding army of Annibal. The difheartened and 
frequently defeated African militia joined it, and 
at the battle of Zama, compofed the greater part 
of the troops of Annibal. The event of that day 
determined the fate of the two rival republics. 

FROM the end of the fecond Carthaginian war 
till the fall of the Roman republic, the armies 
of Rome were in every refpecl: ftanding armies. 
The ftanding army of Macedon made fome re- 
fiftance to their arms. In the height of their 
grandeur, it coft them two great wars, and three 
great battles, to fubdue that little kingdom ; of 
which the conqueft would probably have been 
ftill more difficult, had it not been for the cow- 
ardice of hs laft king. The militias of all the ci- 
4 jilizcd 



6* THE NATURE AND CAUSES OF 

BOOK vilized nations of the antient world, of Greece, 
of Syria, and of Egypt, made but a feeble refifl- 
ance to the (landing armies of Rome. The mi- 
litias of fome barbarous nations defended them- 
felves much better. The Scythian or Tartar 
militia, which Mithridates drew from the coun- 
tries north of the Euxine and Cafpian feas, were 
the moft formidable enemies whom the Romans 
had to encounter after the fecond Carthaginian 
war. The, Parthian and Germaa militias too 
were always refpe&able, and, upon feveral occa- 
fions, gained very confiderable advantages over 
the Roman armies. In general, however, and 
when the Roman armies were well commanded, 
they appear to have been very much fuperior ; 
and if the Romans did not purfue the final con- 
queft either of Parthia or Germany, it was pro- 
bably becaufe they judged, that it was not worth 
while to add thofe two barbarous countries to an 
empire which was already too large. The an- 
tient Parthians appear to have been a nation of 
Scythian or Tartar extraction, and to have always 
retained a good deal of the manners of their 
anceftors. The antient Germans were, like the 
Scythians or Tartars, a nation of wandering 
fhepherds, who went to war under the fame 
chiefs whom they were accuftomed to follow in 
peace. Their militia was exaclly of the fame 
kind with that of the Scythians or Tartars, from 
whom too they were probably defcended. 

MANY different caufes contributed to relax the 
difcipline of the Roman armies. Its extreme 
fcverity was, perhaps, one of thofe caufes. In 

the 



THE WEALTH OF NATIONS. 65 

the days of their grandeur, when no enemy ap- c H A P. 
peared capable of oppofing them, their heavy 
armour was laid afide as unneceffarily burden- 
fome, their laborious exercifes were neglected as 
unneceffarily toilfome. Under the Roman em- 
perors befides, the (landing armies of Rome, thofe 
particularly which guarded the German and Pan- 
nonian frontiers, became dangerous to their maf- 
ters, againfl whom they ufed frequently to fet up 
their own generals. In order to render them lefs 
formidable, according to fome authors, Diocle- 
fian, according to others, Conftantine, firfl with- 
drew them from the frontier, where they had 
always before been encamped in great bodies, 
generally of two or three legions each, and dif- 
perfed them in fmall bodies through the different 
provincial towns, from whence they were fcarce 
ever removed, but when it became neceffary to 
repel an invafion. Small bodies of foldiers quar- 
tered in trading and manufacturing towns, and 
feldom removed from thofe quarters, became 
themfeives. tradefmen, artificers, and manufac- 
turers. The civil came to predominate over the 
military character ; and the Handing armies of 
Rome gradually degenerated into a corrupt, ne- 
glected, and undiiciplined militia, incapable of 
refitting the attack of the German and Scythian 
militias, which foon afterwards invaded the welt- 
ern empire. It was only by hiring the militia of 
fome of thofe nations to oppofe to that of others, 
that the emperors were for fome time able to de- 
fend themfeives. The fall of the weftern em- 
pire is the third great revolution in the affairs of 
VOL. in. F maakind, 



66 ' THE NATURE AND CAUSES OF 

BOOK mankind, of which antient hiftory has preferred 
any diflincl or circumftantial account. It -was 
brought about by the irrefiftible fuperiority which 
the militia of a barbarous, has over that of a ci- 
vilized nation ; which the militia of a nation of 
fhepherds, has over that of a nation of hufband- 
men, artificers, and manufacturers. The victo- 
ries which have been gained by militias have gene- 
rally been, not over {landing armies, but over 
other militias in exercifd and difcipline inferior to 
'themfelves. Such were the victories which the 
Greek militia gained over that of the Perfian em- 
pire ; and fuch too were thofe which in later times 
the Swif's militia gained over that of the Auftrians 
and Bufguridians. 

THE military force of the German and Scythian 
nations who eftablifhed themfelves upon the ruins 
of the weftern empire, continued for fome time to 
be of the fame kind in their new fettlements, as 
it had been in their original country. It was a 
militia of Ihepherds and hufbandmen, which, in 
time of war, took the field under the command 
of the fame chieftains whom it was accuilomed 
to obey in peace. It was, therefore, 'tolerably 
well exercifed, and tolerably well difciplined. As 
arts and induftry advanced, however^ the autho- 
rity of the chieftains gradually decayed, and the 
great body of the people had lefs time to fpare 
'for military exercifes. Both the difcipline and 
the exercife of the feudal militia, therefore, went 
gradually to ruin, and {landing armies were gra- 
dually introduced to fupply the place of it. 
When the expedient of a ftanding army, befides, 

had 



THE WEALTH OF NATIONS. e 7 

had once been adopted by one civilized nation, CHAP. 
it became neceflary that all its neighbours fhould 
follow the example. They foon found that their 
fafety depended upon their doing fo, and that their 
own militia was' altogether incapable of refifting the 
attack of fuch an army. 

THE foldiers of a (landing army, though they 
may never have feen an enemy, yet have fre- 
quently appeared to poflefs all the courage of 
veteran troops, and the .very moment that they 
took the field to have been fit to face the hardieft 
and moft experienced veterans. In 1756, when 
the Ruffian army marched into Poland, the va- 
lour of the Ruffian foldiers did not appear inferior 
to that of the Pruffians, at that time fuppofed to 
be the hardieft and moft experienced veterans 
in Europe. The Ruffian empire, however, had 
enjoyed a profound peace for near twenty years 
before, and could at that time have very few 
foldiers who had ever feen an enemy. When the 
Spanifh war broke out in 1739, England had 
enjoyed a profound peace for about eight and 
twenty years. The valour of her foldiers, however, 
far from being corrupted by that long peace, was 
never more diftinguifhed than in the attempt 
upon Carthagena, the firft unfortunate exploit of 
that unfortunate war. In a long peace the gene- 
rals, perhaps, may fometimes forget their fkill ; 
but, where a well-regulated (landing army has 
been kept up, the foldiers feem never to forget 
their valour. 

WHEN a civilized nation depends for its de- 
fence upon a militia, it is at all times expofed to 

F 2 be 



8 THE NATURE AND CAUSES OF 

BOOK be conquered by any barbarous nation which 
happens to be in its neighbourhood. The frequent 
conquefls of all the civilized countries in Afia by 
the Tartars, fufficiently demonftrates the natural 
fuperiority, which the militia of a barbarous, ha,s 
over that of a civilized nation. A well-regulated 
{landing army is fuperior to every militia. Such 
an army, as it can bed be maintained by an opu- 
lent and civilized nation, fo it can alone defend 
fuch a nation againfl the invafion of a poor and 
barbarous neighbour. It is only by means of a 
(landing army, therefore, that the civilization of 
any country can be perpetuated, or even preferred 
for any confiderable time. 

As it is only by means of a well-regulated 
{landing army that a civilized country can be 
defended 5 fo it is only by means of it, that a 
barbarous country can be fuddenly and tolerably 
.civilized. . A {landing army eftablifhes, with an 
irrefiflible force, the law of the fovereign through 
the remotefl provinces of the empire, and main- 
tains fome degree of regular government in 
countries which could not other wife admit of 
any. Whoever examines, with attention, the 
improvements which Peter the Great introduced 
into the Ruffian empire, will find that they 
almoft all refolve themfelves into the eftablifh- 
ment of a well-regulated {landing army. It is 
the inftrument which executes and maintains all 
his other regulations. That degree of prder and 
internal peace, which that empire has ever'fmce 
enjoyed, is altogether owing to the influence of 
that army. 

MEN 



THE WEALTH OF NATIONS. 6 

MEN of republican principles have been jealous CHAP. 
of a {landing army as dangerous to liberty. It 
certainly is fo, wherever the intereft of the ge- 
neral and that of the principal officers are not 
neceflfarily connected with the fupport of the 
conftitution of the (late. The ftanding army of 
Casfar deftroyed the Roman republic. The 
ftanding army of Cromwel turned the long par- 
liament out of doors. But where the fovereign 
is himfelf the general, and the principal nobility 
and gentry of the country the chief officers of 
the army ; where the military force is placed 
under the command of thofe who have the 
greateft intereft in the fupport of the civil autho- 
rity, becaufe they have themfelves the greateft 
{hare of that authority, a ftanding army can never 
be dangerous to liberty. On the contrary, it 
may in fome cafes be favourable to liberty. The 
fecurity which it gives to the fovereign renders 
unnecefiary that troublefome jealoufy, which, in 
fome modern republics, feems to watch over 
the minuted actions, and to be at all times ready 
to difturb the peace of every citizen. Where 
the fecurity of the magiftrate, though fupported 
by the principal people of the country, is en- 
dangered by every popular difcontent ; where LI 
fmall tumult is capable of bringing about in a 
few hours a great revolution, the whole autho- 
rity of government muft be employed to fup- 
prefs and punifh every murmur and complaint 
againft it. To a fovereign, on the contrary, 
who feels himfelf fupported, not only by the na- 
tural ariftocracy of the country, but by a well- 

F 3 regulated 




THE NATURE AND CAUSES OF 

regulated Handing army, the rudeft, the moft 
groundlefs, and the moil licentious remonftrances 
can give little difturbance. He can fafely pardon 
or neglect them, and his confciouihefs of his own 
fuperiority naturally difpofes him to do fo. That 
degree of liberty which approaches to licentioufnefs 
can be tolerated only in countries where the fove- 
reign is fecured by a well-regulated Handing army. 
It is in fuch countries only, that the public 
fafety does not require, that the fovereign fliould 
be trufted with any difcretionary power, for fup- 
pr effing even the impertinent wantonnefs of this 
licentious liberty. 

THE firft duty of the fovereign, therefore, that 
of defending the fociety from the violence and 
injuftice of other independent focieties, grows gra- 
dually more and more expenfive, as the fociety 
advances in civilization. The military force of 
the fociety, which originally coft the fovereign no 
expence either in time of peace or in time of war, 
muft, in the pfogrefs of improvement, firft be 
maintained by him in time of war, and afterwards 
even in time of peace. 

THE great change introduced into the art of 
war by the invention of fire-arms, has enhanced 
ftill further both the expence of exercifmg and 
difciplining any particular number of foldiers in 
time of peace, and that of employing them in 
time of war. Both their arms 'and their ammu- 
nition are become more "expenfive, A mufquet 
is a more expenfive machine than a javelin or a 
bow and arrows ; a cannon or a mortar, than a 

bajifta 



THE. WEALTH OF NATIONS. 

balifta or a catapulta. The powder which is 
fpent in a modern review, is loft irrecoverably, 
and occafions a very confiderable expence. The 
javelins and arrows which were thrown or (hot in 
an antient one, could eafily be picked up again, 
and were befides of very little value. The can- 
non and the mortar are, not only much dearer, 
but much heavier machines than the balifta or 
catapulta, and require a greater expence, not 
only to prepare them for the field, but to carry 
them to it. As the fuperiority of the modern 
artillery, too, over that of the antients is very 
great ; it has become much more difficult, and 
confequently much more expenfive, to fortify a 
town fo as to refifl, even for a few weeks, the at- 
tack of that fuperior artillery. In modern times 
many different caufes contribute to render the 
defence of the fociety more expenfive. The un- 
avoidable , effeds of the natural progrefs of im- 
provement, have, in this refpect, been a good deal 
enhanced by a great revolution in the art of war, 
to which a mere accident, the invention of gun- 
powder, feems to have given occafion. 

IN modern war the great expence of fire-arms 
gives an evident advantage to the nation which 
can belt afford that expence ; and confequently, 
to an opulent and civilized, over a poor and bar- 
barous nation. In antient times the opulent and 
civilized found it difficult to defend' themfelves 
againft the poor and barbarous nations. In mo- 
dern times the poor and barbarous find it diffi- 
cult to defend themfelves againft the opulent and 
civilized. The invention of fire-arms, an inven- 

F 4 tion 




72 THE NATURE AND CAUSES OF 

BOOK tion which at firft fight appears to be fo pernicious, 
is certainly favourable both to the permanency anc} 
to the extenfion of civilization. 



PART II. 

Of the Expence of Juftice. 

E fecond duty "of the fovereign, that of 
protecting, as far as poffible, every member 
of the fociety from the injuftice or oppreflion of 
every other member of it, or the duty of eftablifhr 
ing an exact adminiftration of juftice, requires two 
very different degrees of expence in the different 
periods of fociety. 

AMONG nations of hunters, as there is fcarce 
any property, or at leaft none that exceeds the 
value of two or three days labour; fo there is 
feldom any eftablimed magiftrate, or any regular 
adminiftration of juftice. Men who have no 
property can injure one another only in their 
perfons or. reputations. But when one man kills, 
wounds, beats, or defames another, though he 
to whom the injury is done fuffers, he who does 
it receives no benefit. It is otherwife with the 
injuries to property. The benefit of the perfon 
who does the injury is often equal to the lofs of 
him who fuffers it. Envy, malice, or refent- 
ment, are the only paflions which can prompt 
one man to injure another in his perfon or repu- 
tation. But the greater part of men are not very 
frequently under the influence of thofe paflions ; 

and 



THE WEALTH OF NATIONS. 73 

and "the very word men are fo only occafionally. CHAP. 
As their gratification too, how agreeable foever 
it may be to certain characters, is not attended 
with any real or permanent advantage, it is in 
the greater part of men commonly reftrained by 
prudential confiderations. Men may live to- 
gether in fociety with fome tolerable degree of 
fecurity, though there is no civil magiflrate to 
proteft them from the injuftice of thofe paffions^ 
put avarice and ambition in the rich, in the poor 
the hatred of labour and the love of prefent eafe 
and enjoyment, are the paffions which prompt to 
invade property, paffions much more fteady in 
their operation, and much more univerfal in 
their influence. Wherever there is great pro- 
perty, there is gre^t inequality. For one very 
rich man, there muft be at leaft five hundred 
poor, and the affluence of the few fuppofes the 
indigence of the many. The affluence of the 
rich excites the indignation of the poor, who are 
often both driven by want, and prompted by 
envy, to invade his pofieflions. It is only under 
the fhelter of the civil magillrate that the owner 
of that valuable property, which is acquired by 
the labour of many years, or perhaps of many 
fuccedive generations, can fleep a fmgle night in 
fecurity. He is at all times furrounded by un- 
known enemies, whom, though he never pro- 
yoked, he can never appeafe, and from whofc 
injuftice he can be prote&ed only by the power- 
ful arm of the civil magiftrate continually held 
up to chaftife it. The acquifition of valuable 
and extenfive property, therefore 3 necefiarily re- 
quires 





74 THE NATURE AND CAUSES OF 

quires the eftablifhment of civil government. 
Where there is no property, or at lead none that 
exceeds the value of two or three days labour, civil 
government is riot fo necelTary. 

CIVIL government fuppofes a certain fubordi- 
nation. But as the neceflity of civil government 
gradually grows up with the acquifition of valu- 
able property, fo the principal caufes which na- 
turally introduce fubordination gradually grow up 
with the growth of that valuable property. 

THE caufes or circumftances which naturally in- 
troduce fubordination, or which naturally, and an- 
tecedent to any civil inftitution, give fome men 
fome fuperiority over the greater part of their bre- 
thren, .feem to be four in number. . 

THE firft of thofe caufes or circumftances 
is the fuperiority of perfonal qualifications, of 
ftrength, beauty, and agility of body ; of wif- 
dorh, and virtue, of prudence, juftice, forti- 
tude, and moderation of mind. The qualifica- 
tions of the body, unlefs fupported by thofe of 
the mind, can give little authority in any period 
of fociety. He is a very ftrong man, who by 
mere ftrength of body can force two weak ones 
to obey him. The qualifications of the mind 
can alone give very great authority. They are, 
however, invifible qualities ; always difputable, 
and generally difputed". > No fociety, whether 
barbarous or civilized, has ever found it con- 
venient to fettle the rules of precedency of rank 
*4nd fubordination, according to thofe invifible 
qualities ; but according to fomething that is 
more plain and palpable. 

THE 



THE WEALTH OF NATIONS. 

THE fecond of thofe caufes or circumftances is 
the fuperiority of age. An old man, provided 
his age is not fo far advanced as to give fufpicion 
of dotage, is everywhere more refpe&ed than a 
young man of equal rank, fortune, and abilities. 
Among nations of hunters, fuch as the native 
tribes of North America, age is the fole founda- 
tion of rank and precedency. Among them 
father is thp appellation of a fuperior ; brother, 
of an equal ; and fon, of an inferior. In the 
moft opulent and civilized nations, age regulates 
rank among thofe who are in every other refpeft 
equal ; and among whom, therefore, there is 
nothing elfe to regulate it. Among brothers 
and among filters, the eldeft always takes place ; 
and in the fucceflion of the paternal eftate, every 
thing which cannot be divided, but muft go 
entire to one perfon, fuch as a title of honour, is in 
moft cafes given to the eldeft. Age is a plain and 
palpable quality which admits of no difpute. 

THE third of thofe caufes or circumftances is 
the fuperiority of fortune. The authority of 
riches, -however, though great in every age of 
fociety, is perhaps greateft in the rudeft ages of 
fociety which admits of any confiderable ine- 
quality of fortune. A Tartar chief, the increafe 
of whofe herds and flocks is fufficient to main- 
tain a thoufand men, cannot well employ that 
increafe in any other way than in maintaining a 
thoufand men. The rude ftate of his fociety 
does* not afford him any manufactured produce, 
any trinkets or baubles of any kind, for which 
he can exchange that part of his rude produce, 

which 




-6 THE NATURE AND CAUSES OF 

BOOK which is over and above his own confumption. 
The thoufand men whom he thus maintains, de- 
pending entirely upon him for their fubfiftence, 
muft both obey his orders in war, and fubmit to 
his jurifdiction in peace. He is neceflarily both 
their general and their judge, and his chieftain- 
fhip is the neceiiary effect of the fuperiority of 
his fortune. In an opulent and civilized fociety, 
a man may pofiefs a much greater fortune, and 
yet not be able to command a dozen of people. 
Though the produce of his eftate may be fuffi- 
cient to maintain, and may perhaps actually 
maintain, more than a thoufand people, yet as 
thofe people pay for every thing which they get 
from him, as he gives fcarce any thing to any 
body but in exchange for an equivalent, there is 
fcarce any body who confiders himfelf as entirely 
dependent upon him, and his authority extends 
only over a few menial fervants. The authority 
of fortune, however, is very great even in an 
opulent and civilized fociety. That it is much 
greater than that, either of age, or of perfonal 
qualities, has been the conftant complaint of 
every period of fociety which admitted of any 
confuierable inequality of fortune. The firft 
period of fociety, that of hunters, admits of 'no 
iuch inequality. Univerfal poverty eftablifhes 
their "univerfal equality, and the fuperiority, 
either of age .or of perfonal qualities are the 
feeble bnt the fole foundations of authority and 
Subordination. There 'is therefore little or no 
authority or fubordination in this period of fo- 
ciety. The fecond period of fociety, that of 

Ihepherds, 



THE WEALTH OF NATIONS. 77 

fhepherds, admits of very great inequalities of c H A P. 
fortune, and there is no period in which the 
fuperiority of fortune gives fo great authority to 
thofe who poffefs it. There is no period ac- 
cordingly in which authority and fubordination 
are more perfectly eftablifhed. The authority 
of an Arabian fcherif is very great ; that of a 
Tartar khan altogether defpotical. 

THE fourth of thofe caufes or circumftances is 
the fuperiority of birth. Superiority of birth 
fuppofes an antient fuperiority of fortune in the 
family of the perfon who claims it. All families 
are equally antient ; and the anceftors of the 
prince, though they may be better known, can- 
not well be more numerous than thofe of the 
beggar. Antiquity f family means every where 
the antiquity 'either of wealth, or, of that great- 
nefs which is commonly either founded upon 
wealth, or accompanied with it. Upftart great- 
nefs is everywhere lefs refpecled than antient 
greatnefs. The hatred of uiurpers, the love of 
the family of an antient monarch, are, in a great 
meafure, founded upon the contempt which men 
naturally have for the former, and upon their 
veneration for the latter. As a military officer 
fubmits without reluctance to the authority of a 
fuperior by whom he has always been com- 
manded, but cannot bear that his inferior fhould 
be fet over his head ; fo men eafily fubmit to 
a family to whom they and their anceftors 
have always fubmitted ; but are fired with in- 
dignation when another family, in whom they 

had 



7 $ THE NATURE AND CAUSES OF 

BOOK, had never acknowledged any fuch fuperiority, 
v * . aiTumcs a dominion over them. 

THE diftinclion of birth, being fubfequent to 
the inequality of fortune, can have no place in 
nations of hunters, among whom all men, being 
equal in fortune, mufl likewife be very nearly 
equal in birth. The fon of a wife and brave 
man may, indeed, even among them, be fome- 
\vhat more refpe&ed than a man of equal merit 
who has the misfortune to be the fon of a fool, or 
a coward. The difference, however, will not 
be very great ; and there never was, I believe, a 
great family in the world whofe illuftration was 
entirely derived from the inheritance of wifdom 
and virtue. . 

THE diftinclion of birth not only may, but 
always does take place among nations of fhep- 
herds. Such nations are always ftrangers to 
every fort of luxury, and great wealth can fcarce 
ever be diffipated among them ' by improvident 
profufion. There are no nations accordingly 
who abound more in families revered and ho- 
noured on account of their defcent from a long race 
of great and illuftrious anceftors ; becaufe there 
are no nations among whom wealth is likely to 
continue longer in the fame families. 

BIRTH and fortune are evidently the two cir- 
cumftances which principally fet one man above 
another. They are the two great fources of per- 
fonal diftinction, and are therefore the principal 
caufes which naturally eftablifh authority and 
fubor dinar io-n among men. Among nations of 
5 jfhepherds 



*THE WEALTH OF NATIONS. 

fliepherds both thofe caufes operate with their c H^A p. 

full force. The great ihepherd or herdfman, 

refpected on account of his great wealth, and of 

the great number of thofe who depend upon him 

for fubfiftence, and revered on account of the 

noblenefs of his birth, and of the immemorial 

antiquity of his illuftrious family, has a natural 

authority over all the inferior fhepherds or herdf- 

men of his horde or clan. He can command 

the united force of a greater number of people 

than any of them. His military power is greater 

than that of any of them. In time of war they 

are all of them naturally difpofed to mufter 

themfelves under his banner, rather than under 

that of any other pcrfon, and his birth and 

fortune thus naturally procure to him fome fort 

of executive power. By commanding too the 

united force of a greater number of people than 

any of them, he is beft able to contpel any one 

of them who may have injured another to com- 

penfate the wrong. He is the perfon, therefore, 

to whom all thofe who are too weak to defend 

themfelves naturally look up for protection. It is, 

.to him that they naturally complain of the injuries 

which they imagine have been done to them, 

and his interpofition in fuch cafes is more eafily 

fubmitted to, even by the perfon complained of, 

than that of any other perfon would be. His 

birth and fortune thus naturally procure him 

fome fort of judicial authority. 

IT is in the age of ihepherds, in the feconj 
period of fociety, that the inequality of fortune 
nrit begins to take place, and introduces among 

mea 



*o THE NATURE AND CAUSES OF 

BOOK men a degree of authority and fubordination 
which could not poffibly exift before. It thereby 
introduces fome degree of that civil government 
which is indifpenfably neceflary for its own pre- 
fervation : and it feems to do this naturally, and 
even independent of the confideration of that 
neceility. The confideration of that neceflity 
comes no doubt afterwards to contribute Very 
much to maintain and fecure that authority and 
fubordination. The rich, in particular, are 
necefTarily interefted to fupport that order of 
things, which can alone fecure them in the pof- 
feflion of their own advantages. Men of inferior 
wealth combine to defend thofe of fuperior wealth 
in the pofTefiion of their property, in order that 
men of fuperior wealth may combine to defend 
them in the poffeilion of theirs. All the in- 
ferior fhepherds and herdfmen feel that the fecu- 
rity of their own herds and flocks depends upon 
the fecurity of thofe of the great fhepherd or 
herdfinan; that the maintenance of their lefler 
authority depends upon that of his greater au- 
thority, and that upon their fubordination to 
him depends his power of keeping their inferiors 
in fubordination to them. They conftitute a 
fort of little nobility, who feel themfelves in- 
terefted to defend the property and to fupport 
the authority of their own little fovereign, in 
order that he may be able to defend their pro- 
perty and to fupport their authority. Civil 
government, fo far as it is inftituted for the fecu- 
n'ty of property, is in reality inftituted for the 
defence of, the rich againft the poor, or of thofe 
12 who 



THE WEALTH OF NATIONS. 

who have fome property againft thofe who have 
none at all. 

THE judicial authority of fuch a fovereign, how- 
ever, far from being a caufe of expence, was for 
a long time a fource of revenue to him. The per- 
fons who applied to him for juftice were always will- 
ing to pay for it, and a prefent never failed to ac- 
company a petition. After the authority of the 
fovereign too was thoroughly eftablifhed, the per- 
fon found guilty, over and above the fatisfaciion 
which he was obliged to make to the party, was 
likewife forced to pay an amercement to the fove- 
reign. He had given trouble, Ke had difturbed, 
he had broke the peace of his lord the king, and 
for thofe offences an amercement was thought due. 
In the Tartar governments of Afia, in the govern- 
ments of Europe which were founded by the Ger- 
man anc. Scythian nations who overturned the 
Roman empire, the adminiflration of juftice was a 
confiderable fource of revenue, both to the fove- 
reign. and to all the lelfer chiefs or lords who exer- 
cifed under him any particular jurifdiction, either 
over fome particular tribe or clan, or over fome 
particular territory or diftrict. Originally both the 
fovereign and the inferior chiefs ufed to exercife 
this jurifdiction in their own perfons. Afterwards 
they univerfally found it convenient to delegate 
it to fome fubftitute, bailiff, or judge. This fub- 
ftitute, however, was flill obliged to account to 
his principal or conflituent for the profits of the 
jurifdi&ion. Whoever reads the * inflruclions 

* They are to be found in Tyrrel's Hiftory of England. 

VOL. in. Q which 



THE NATURE AND CAUSES OF 

which were given to the judges of the circuit in 
the time of Henry II. will fee clearly that thofe 
judges were a fort of itinerant fadors, fent round 
the country for the purpofe of levying certain, 
branches of the king's revenue. In thofe days 
the adminiftration of juftice, not only afforded a 
certain revenue to the fovereign, but to procure 
this revenue feems.to have been one of the princi- 
pal advantages which he propofed to obtain by the 
adminiftration of juftice. 

THIS fcheme of making the adminiftration of 
juftice fubfervient to the purpofes of revenue, 
could fcarce fail to be productive of feveral very 
grofs abufes. The perfon, who applied for 
juftice with a large prefent in his hand, was likely 
to get fomething more than juftice ; while he* 
who applied for it with a mi all one, was likely 
to get fomething lefs. Juftice too might fre- 
quently be delayed, in order that this prefent 
might be repeated. The amercement, befides, 
of the pcrfon complained of, might frequently 
fuggeft a very ftrong reafon for finding him in the 
wrong, even when he had not really been fo. That 
fuch abufes were far from being uncommon, the 
antient hiftory of every country in Europe bears 
witnefs. 

WHEN the fovereign or chief exercifed his ju- 
dicial authority in his own perfon, how much 
foever he might abufe it, it muft have been fcarce 
poffible to get any redrefs ; becaufe there could 
feldom be any body powerful enough to call him 
to account. When he exercifed it by a bailiff, 
indeed, redrefs might fometimcs be had, Jf it 

was 



WEALTH OF NATIONS. S 3 

\vas for "his own benefit only, that the bailiff had CHAP. 
been guilty of an aft of injuftice, the fovereign 
himfelf might not always be Unwilling to punifli 
him, or to oblige him to repair the wrong. But 
if it was for the benefit of his fovereign, if it was 
in order to make court to the perfon who ap- 
pointed him and who might prefer him, that he 
had committed any aft of oppreflion, redrefs 
would Upon moft occafions be as impoffible as if 
the fovereign had committed it himfelf. In all 
barbarous governments, accordingly, in all thofe 
antient governments of Europe in particular, 
which were founded upon the ruins of the Roman 
empire, the adminiftration of juftice appears fof 
a long time to have been extremely corrupt 5 far 
from being quite equal and impartial even under 
the beft monarchs, and altogether profligate un- 
der the word; 

AMONG nations of fhepherds, where the fo- 
vereign or chief is only the greateft fhepherd or 
herdfman of the horde or clan, he is maintained 
in the fame manner as any of his vafTals or fub- 
jefts, by the increafe of his own herds or flocks. 
Among thofe nations of hufbandmen who are but 
juft come out of the fhepherd ftate, and who are 
not much advanced beyond that ftate ; fuch as 
the Greek tribes appear to have been about the 
time of the Trojan war, and our German and 
Scythian anceftors when they firft fettled upon 
the ruins of the weftern empire ; the fovereign or 
chief is, in the fame manner, only the greateft 
landlord of the country, and is maintained, in 
the fame manner as any other landlord, by a 
G 2 revenue 




$4 THE NATURE AND CAUSES OF 

revenue derived from his own private eftate, or 
from what, in modern Europe, was called the 
demefne of the crown. His fubjects, upon 
ordinary occafions, contribute nothing to his fup- 
port, except when, in order to protect them from 
the oppreffion of fome of their fellow-fubjects, 
they (land in need of his authority. The pre- 
fents which they make him upon fuch occafions, 
conflitute the whole ordinary revenue, the whole 
of the emoluments which, except perhaps upon 
fome very extraordinary emergencies, he derives 
from his dominion over them. When Agamem- 
non, in Homer, offers to Achilles for his friend- 
fhip the fovereignty of feven Greek cities, the 
fole advantage which he mentions as likely to be 
derived from it, was, that the people would 
honour him with prefents. As long -as fuch pre* 
fents, as long as the emoluments of juftice, or 
what may be called the fees of court, conftituted 
in this manner the whole ordinary revenue which 
the fovereign derived from his fovereignty, it could 
not well be expected, it could not even decently be 
propofed, that he fhould give them up altogether. 
It might, and it frequently was propofed, that he 
fliould regulate and afcertain them. But after they 
had been fo regulated and afcertained, how to hin- 
der a perfon who was all-powerful from extending 
them beyond thofe regulations, was flill very diffi- 
cult, not to fay impoflible. During the continuance 
of this (late of things, therefore, the corruption of 
juftice, naturally refulting from the arbitrary and 
uncertain nature of thofe prefents, fcarce admitted 
of any effectual remedy. 

BUT 



THE WEALTH OF NATIONS. $ 

BUT when from different caufes, chiefly from CHAP* 
the continually increafing expence of defending 
the nation againft the invafion of other nations, 
the private eftate of the fovereign had become 
altogether infufficient for defraying the expence 
of the fovereignty ; and when it had become 
neceflary that the people fhould, for their own 
fecurity,* contribute towards this expence by taxes 
of different kinds, it feems to have been very 
commonly ftipulated, that no prefent for the ad- 
miniftration of juftice fhould, under any pre- 
tence, be accepted either by the fovereign, or by 
his bailiffs and fubftitutes, the judges. Thofe 
prefents, it feems to have been fuppofed, could 
more eafily be abolifhed altogether, than effectu- 
ally regulated and afcertained. Fixed falaries were 
appointed to the judges, which were fuppofed to 
compenfate to them the lofs of whatever might 
have been their {hare of the antient emoluments of 
juftice ; as the taxes more than compenfated to the 
fovereign the lofs of his. Juftice was then faid to 
be adminiftered gratis. 

JUSTICE, however, never was in reality ad- 
miniftered gratis in any country. Lawyers and 
attornies, at leaft, muft always be paid by the 
parties ; and, if they were not, they would per- 
form their duty ftill worfe than they actually per- 
form it. The fees annually paid to lawyers and 
attornies amount, in every court, to a much 
greater fum than the falaries of the judges. The 
circumftance of thofe falaries being paid by the 
crown, can nowhere much diminifh the neceflary 
expence of a law-fuit. But it was not fo much 

03 to 




8$ THE NATURE AND CAUSES OF 

to diminifh the expence, as to prevent the Cor- 
ruption of juftice, that the judges we're prohibited 
from receiving any prefent or fee from the parties. 

THE office of judge is in itfelf fo very ho- 
nourable, that men are willing to accept of it, 
though accompanied with very fmall emoluments. 
The inferior office of juftice of peace, though at- 
tended with a good deal of trouble, and in moil 
cafes with no emoluments at all, is an object of 
ambition to the greater part of our country gen- 
tlemen. The falaries of all the different judges, 
high and low, together with the whole ex;pence 
of the adminiftration and execution of juftice, 
even where it is not managed with very good 
ceconomy, makes, in any civilized country, but 
a very inconfiderable part of the whole expence of 
government. 

THE whole expence of juflice too might eafily 
be defrayed by the fees of court ; and, without 
expofing the adminiftration of juftice to any real 
hazard of corruption, the public revenue might 
thus be entirely difcharged from a certain, 
{hough, perhaps, but a fmall incumbrance. It 
is difficult to regulate the fees of court effectu- 
ally, where a perfon fo powerful as the fovereign 
is to mare in .{hem, and to derive any confider- 
able part of his revenue from them. It is very 
cafy, where the judge is the principal perfon who 
can reap any benefit from them. The law can 
very eafily oblige the judge to refpect the regula- 
tion, though it might not always be able to 
make the fovereign refpect it. Where the fees 
pf court are precifely regulated and afcertained, 

where 



THE WEALTH OF NATIONS. 7 

where they are paid all at once, at a certain ' H j A p * 
period of every procefs, into the hands of a 
cafhier or receiver, to be by him diftributed in 
certain known proportions among the different 
judges after the procefs is decided, and not till 
it is decided, there feems to be no more danger 
of corruption than where fuch fees are prohibited 
altogether. Thofe fees, without occafioning any 
confiderable increafe in the expence of a law- 
fuit, might be rendered fully fufficient for de- 
fraying the whole expence of juflice. By not 
being paid to the judges till the procefs was de- 
termined, they might be fome incitement to the 
diligence of the court in examining and deciding 
it. In courts which confifted of a confiderable 
number of judges, by proportioning the {hare of 
each judge' to the, number of hours and days 
which he had employed in examining the procefs, 
cither in the court or in a committee by order of 
the court, thofe fees might give fome encourage- 
ment to the diligence of each particular judge. 
Public fervices are never better performed than 
when their reward comes only in confequence of 
their being performed, and is proportioned to 
the diligence employed in performing them. In 
the different parliaments of France, the fees of 
court (called Epices and vacations) conftitute 
the far greater part of the emoluments of the 
judges. After all deductions are made, the neat 
falary paid by the crown to a counfellor or judge 
in the parliament of Touloufe, in rank and dig- 
nity the fecond parliament of the kingdom, 
amounts only to a hundred and fifty livres, about 

G 4 fix 



$S THE NATURE AND CAUSES OF 

BOOK fix pounds eleven (hillings fterling a year. About 
feven years ago that fum was in the fame place 
the ordinary yearly wages of a common footman. 
The diftribution of thofe Epices too is according 
to the diligence of the judges. A diligent judge 
gains a comfortable, though moderate, revenue 
by his office : an idle one gets little more than 
his falary. Thofe parliaments are perhaps, in 
many refpe&s, not very convenient courts of 
juftice ; but they have never been accufed ; they 
feem never even to have been fufpefted of cor- 
ruption. 

THE fees of court feem originally to have been 
the principal fupport of the different courts of 
juftice in England. Each court endeavoured to 
draw to itfelf as much bufmefs as it could, and 
was, upon that account, willing to take cogni- 
zance of many fuits which were not originally in- 
tended to fall under its jurifdiclion. The court of 
king's bench, inftituted for the trial of criminal 
caufes only, took cognizance of civil fuits ; the 
plaintiff pretending that the defendant, in not 
doing him juftice, had been guilty of fome tref- 
pafe or mifdemeanor. The court of exchequer, 
inftituted for the levying of the king's revenue, 
and for enforcing the payment of fuch debts 
only as were due to the king, took cognizance 
of all other contract debts ; the plaintiff alleg- 
ing that he could not pay the king, becaufe the 
defendant would not pay him. In confequence 
qf fuch fictions it came, in many cafes, to depend 
altogether upon the parties before what court 
they would chufe to have their caufe tried , and 



THE WEALTH OF NATIONS. 

each court endeavoured, by fuperior difpatch 
and impartiality to draw to itfelf as many caufes 
as it could. The prefent admirable constitution 
of the courts of juftice in England was, perhaps, 
originally, in a great meafure, formed by this 
emulation, which antiently took place between 
their refpe&ive judges ; each judge endeavour- 
ing to give, in his own court, the fpeedieft and 
mofl effectual remedy, which the law would ad* 
mit, for every fort of injuflice. Originally the 
courts of law gave damages only for breach of 
contract. The court of chancery, as a court of 
confcience, firlt took upon it to enforce the fpe- 
cific performance of agreements. When the 
breach of contract confifted in the non-payment 
of money, the damage fuftained could be com- 
penfated in no other way than by ordering pay- 
ment, which was equivalent to a fpecific perform- 
ance of the agreement. In fuch cafes, therefore, 
the remedy of the courts of law was fufficient. It 
was not fo in others. When the tenant fued his 
lord for having unjuftly outed him of his leafe, 
the damages which he recovered were by no- 
means equivalent to the poffeffion of the land. 
Such caufes, therefore, for fome time, went all to 
the court of chancery, to the no fmall lofs of the 
courts of law. It was to draw back fuch caufes 
to themfeives that the courts of law are faid to have' 
invented the artificial and fictitious writ of eject- 
ment, the mod effectual remedy for an unjuft 
outer or difpofleflion of land. 

A STAMP-DUTY upon the law proceedings of 
each particular court, to be levied by that court, 

and 






THE NATURE AND CAUSES OF 

and applied towards the maintenance of the judges 
and other officers belonging to it, might, in the 
fame manner, afford a revenue fufficient for de- 
fraying the expence of the adminiftration of juf- 
tice, without bringing any burden upon the ge- 
neral revenue of -the fociety. The judges indeed 
might, in this cafe, be under the temptation of 
multiplying unneceffarily the proceedings upon 
.every caufe, in order to increafe, as. much as pof- 
fible, the produce of fuch a {lamp-duty. It has 
been the cuftom in modern Europe to regulate, 
upon mod occafions, the payment of the attor- 
jpes .and clerks of court, according to the num- 
ber of pages which 1 they had occafion to write ; 
the-r court, however, requiring that each page 
fhould contain fo many lines, and each line fo 
jnai)y v/prds. In order to increafe their pay- 
ment, ^he gttorjiies ^^ clerks have contrived to 
multiply \vprds^ beyond all neceflity, to the cor- 
ruption 'of; the law language of, I believe, every 
court of j Lidice in Europe. A like temptation 
might perhaps occafion a like corruption in the 
form of law proceedings. 

BUT whether the adminiftration of juftice be 
fo contrived as to defray its own expence, or 
whether the judges be maintained by fixed fa- 
laries paid to them from fome other fund, it does 
not feem necefTary that the perfon or perfons 
Intruded with the executive power mould be 
charged with the, management of that fund, or 
with the payment of thofe falaries. That fund 
might arife from the rent of landed eftates, the 
management of each e/tate .being, entrufted to the 

particular 



THE WEALTH OF NATIONS, 91 

particular court which was to be maintained by CHAP. 
it. That fund might arife even from the inte- 
reft of a fum of money, the lending out of which 
might, in the fame manner, be entrufted to the 
court which was to be maintained by it. A part, 
though indeed but a fmall part, of the falary of 
the judges of the court of Seflibn in Scotland, 
arifes from the intereft of a fum of money. The 
neceflary inftability of fuch a fund feems, how- 
ever, to render it an improper one for the main- 
tenance of an inftitution which ought to lad for 
ever. 

THE feparation of the judicial from the execu- 
tive power ' feems originally to have arifen from 
the increafmg bufinefs of the fociety, in confe- 
quence of its increaflng improvement. The ad- 
miniftration of juftice became fo laborious and 
fo complicated a duty as to require the undi- 
vided attention of the perfons to whom it was 
entrufted. The perfon entrufted with the exe- 
cutive power, not having leifuie to attend to the 
decifion of private caufes himfelf, a deputy was 
appointed to decide them in his (lead. In the 
progrefs of the Roman greatnefs, the conful was 
too much occupied with the political affairs of 
the ftate, to attend to the adminiftration of juf- 
tice. A prgetor, therefore, was appointed to ad- 
minifter it in his ftead. In the progrefs of the 
European monarchies which were founded upon 
the ruins of the Roman empire, the fovereigns 
and the great lords came univerfally to confider 
the adminiftration of juftice as an office, both 
too laborious and too ignoble for them to exe- 
cute in their own perfons. They univerfally, 

therefore, 




$2 THE NATURE AND CAUSES OF 

therefore, difcharged themfelves of it by appoint- 
ing a deputy, bailiff, or judge, 

WHEN the judicial is united to the executive 
power, it is fcarce pofTible that juilice fhould not 
frequently be facrificed to, what is vulgarly called, 
politics. The perfons entrufted with the great 
interefls of the (late may, even without any cor- 
rupt views, fometimes imagine it necefiary to 
facrifice to thofe interefls the rights of a private 
man. But upon the impartial adminiftration of 
juftice depends the liberty of every individual, 
the fenfe which he has of his own fecurity. In 
order to make every individual feel himfelf per- 
fectly fecure in the pofleffion of every right which 
belongs to him, it is not only neceffary that the 
judicial fhould be feparated from the executive 
power, but that it fhould be rendered as much as 
poflible independent of that power. The judge 
mould not be liable to be removed from his office 
according to the caprice of that power. The re- 
gular payment of his falary fhould not depend upon 
the good-will, or even upon the good ceconomy 
of that power. 

PART III. 

Of ihe Expence of public Works and public 
Inftitutions. 

nrHE third and laft duty of the fovereign or 
commonwealth is that of creeling and main- 
taining thofe public inflitutions and thofe public 
works, which, though they may be in the highefl 
degree advantageous to a great fociety, are, how- 
ever, 



THE WEALTH OF NATIONS. 93 

ever, of fuch a nature, that the profit could never CHAP. 
repay the expence to any individual or fmall num- 
ber of individuals, and which it therefore can- 
not be expected that any individual or fmall 
number of individuals fhould erect or maintain. 
The performance of this duty requires too very 
different degrees of expence in the different pe- 
riods of fociety. 

AFTER the public inftitutions and public 
works neceflary for the defence of the fociety, 
and for the adminiflration of juftice, both of 
which have already been mentioned, the other 
works and inftitutions of this kind are chiefly 
thofe for facilitating the commerce of the fo- 
ciety, and thofe for promoting the inftruction of 
the people. The inftitutions for inftruclion are 
of two kinds ; thofe for the education of the 
youth, and thofe for the inftruclion of people of 
all ages. The confideration of the manner in 
which the expence of thofe different forts of pub- 
lic works and inftitutions may be moft properly 
defrayed, will divide this third part of the prefent 
chapter into three different articles. 

ARTICLE I. 

Of the public Works and Inftitutions for facilitating 
the Commerce of the Society. 



y frft, of thofe which are necejjary for facili* 
tat ing Commerce in general. 

THAT the erection and maintenance of the 

public works which facilitate the commerce of 

any country, fuch as good roads, bridges, navi- 

13 gable 



94 THfc NATURE AND CAUSES OF 

B v K gable canals, harbours, &c. muft require very 
Different degrees of expence in the different pe- 
riods of fociety, is evident without any proof. 
The expence of making and maintaining the 
public roads of any country muft evidently in- 
creafe with the annual produce of the land and 
labour of that country, or with the quantity and 
weight of the goods which it becomes neceflary 
to fetch and carry upon thofe roads. The 
flrength of a bridge muft be fuited to the num- 
ber and weight of the carriages, which are likely 
to pafs over it. The depth and the fupply of 
water for a navigable canal muft be proportioned 
to the number and tunnage df the lighters, which 
are likely to carry goods upon it ; the extent of 
a harbour to the number of the fhipping which 
are likely to take fhelter in it. 

IT does not feem neceffary that the expence of 
thole public works fhould be defrayed from that 
public revenue, as it is commonly called, of 
which the collection and application are in moft 
countries affigned to the executive power. The 
greater part of fuch public works may eafily be 
fo managed, as to afford a particular revenue 
fufficient for defraying their own expence, with- 
out bringing any burden upon the general revenue 
of the fociety. 

A HIGHWAY, a bridge, a navigable canal, for 
example, may in moft cafes be both made and 
maintained by a fmall toll upon the carriages 
which make ufe of them : a harbour, by a mo- 
derate port-duty upon the tunnage of the fhip- 
ping which load or unload in it. The coinage, 

another 



THE WEALTH OF NATIONS., 95 

another inftitution for facilitating commerce, in e H ^A P. 
many countries, not only defrays its own ex- 
pence, but affords a fmall revenue or feignorage 
to the fovereign. The poft-office, another infti- 
tution for the fame purpofe, over and above de- 
fraying its own expence, affords in almoft all 
countries a very confiderable revenue to the fo- 
vereign. 

WHEN the carriages which pafs over a high- 
way or a bridge, arid the lighters which fail upon 
a navigable canal, pay toll in proportion to their 
weight or their tunnage, they pay for the main- 
tenance of thofe public works exactly in pro- 
portion to the wear and tear which they occafion 
of them. It feems fcarce poffible to invent a 
more equitable way of maintaining fuch works. 
This tax or toll too, though it is advanced by 
the carrier, is finally paid by the confumer, to 
whom it muft .always be charged in the price 
of the goods. As the expence of carriage, how- 
ever, is very much reduced by means of fuch 
public works, the/ goods, notwithftanding the 
toll, come cheaper to the confumer than they 
could otherwife have done; their price not being 
fo much raifed by the toll, as it is lowered by 
the cheapnefs of the carriage. The perfon who 
finally pays this tax, therefore, gains by the ap^ 
plication, more than he lofts by the payment of 
it. His payment is exactly in proportion to his 
gain. It is in reality no more than a part of that 
gain which he is obliged to give up in order to' 
get the reft. It feems impoffible to imagine a 
more equitable method of raifing a tax. ; 

9 .WHEN 




THE NATURE AND CAUSES OF 

WHEN the toll upon carriages of luxury, upon 
coaches, poft-chaifes, &c. is made fomewhat 
higher in proportion to their weight, than upon 
carriages of neceffary ufe, fuch as carts, wag. 
gons, &c. the indolence and vanity of the rich 
is made to contribute in a very eafy manner to 
the relief of the poor, by rendering cheaper the 
tranfportation of heavy goods to all the different 
parts of the country. 

WHEN high roads, bridges, canals, &c. are in 
this manner made and fupported by the com- 
merce which is carried on by means of them, 
they can be made only where that commerce re- 
quires them, and confequently where it is pro- 
per to make them. Their expence too, their 
grandeur and magnificence, mufl be fuited to 
what that commerce can afford to pay. They 
muft be made confequently as it is proper to 
make them. A magnificent high road cannot 
be made through a defart country where there is 
little or no commerce, or merely becaufe it hap- 
pens to lead to the country villa of the intend- 
ant of the province, or to that of fome great lord 
to whom the intend ant finds it convenient to make 
his court. A great bridge cannot be thrown over 
a river at a J)lace were nobody paffes, or merely 
to embellifh the view from the windows of a 
neighbouring palace: things which fometimes 
happen, in countries where works of this kind are 
carried on by any other revenue than that which 
they themfeves are capable of affording. 

IN feveral different parts of Europe the toll 
or lock-duty upon a canal is the property of 
private perfons, whofe private intereft obliges 

them 



THE WEALTH OF NATIONS. 97 

them to keep up the canal. If it is not kept 'in CHAP. 
tolerable order, the navigation neceflarily ceafes 
altogether, and along with it the whole profit 
which they can make by the tolls. If thofe tolls 
were put under the management of commif- 
fioners, who had themfelves no intereft in them, 
they might be lefs attentive to the maintenance 
of the works which produced them. The canal 
of Languedoc coft the king of France and the 
province upwards of thirteen millions of livres, 
which (at twenty-eight livres the mark of filver, 
the value of French money in the end of the laft 
century) amounted to upwards of nine hundred 
thoufand pounds fterling. When that great work 
was finifhed, the moft likely method it was found, 
of keeping it in conflant repair, was to make a 
prefent of the tolls to Riquet the engineer, who 
planned and conducted the work. Thofe tolls 
conftitute at prefent a very large eftate to the dif- 
ferent branches of the family of that gentleman, 
who have, therefore, a great intereft to keep the 
work in conftant repair. But had thofe tolls 
been put under the management of commiflioners, 
who had no fuch intereft, they might perhaps have 
been diflipated in ornamental and unneceflary ex- 
pences, while the moft efiential parts of the work 
were allowed to go to ruin. 

THE tolls for the maintenance of a high road, 
cannot with any fafety be made the property of 
private perfons. A high foad, though entirely 
neglected, does not become altogether impaflable, 
though a canal does. The proprietors of the 
tolls upon a high road, therefore, might negleft 

VOL. in. H altoge- 





THE NATURE AND CAUSES OF 

altogether the repair of the road, and yet continue 
to levy very nearly the fame tolls. It is proper, 
therefore, that the tolls for the maintenance of fuch 
a work mould be put under the management of 
commifli oners or truftees. 

IN Great Britain, t^e abufes which the truftees 
have committed in the management of thofe tolls, 
have in many cafes been very juftly complained 
of. At many turnpikes, it has been faid, the 
money levied is niore than double of what is ne- 
ceffary for executing, in the completeft manner, 
the work, which is often executed in a very flbvenly 
manner, and fometimes not executed at all. The 
fyfterri of repairing the high roads by tolls of this 
kind, it mud be obferved, is not of very long 
{landing. We mould not wonder, therefore, if 
it has not yet been brought to that degree of 
perfection of which it feems capable.. If mean 
and improper perfons are frequently appointed 
truftees ; and if proper courts of infpe&ion and 
account have not yet been eftablifhed for con- 
trolling their conduct, and for reducing the tolls 
to what is barely iufficient for executing the work 
to be done by them ; the recency of the inftitu- 
tion both accounts and apologizes for thofe de- 
fefts, of which, by the wifdom of parliament, the 
greater part may in due time be gradually re- 
medied. 

THE money levied at the different turnpikes 
in Great Britain is fuppofed to exceed fo much 
what is neceflary for repairing the roads, that the 
favings, which, with proper ceconomy, might be 
made from it, have been confidered, even by fome 
13 minifters, 



THE WEALTH OF NATIONS. 9 

mimfters, as a very great refource, which might CHAP. 
at fome time or another be applied to the exi- u -,^t 
gencies of the ftate. Government, it , has been 
faid, by taking the management of the turnpikes 
into its own hands, and by employing the foldiers, 
who would work for a very fmall addition to their 
pay, could keep the roads in good order at a much 
lefs expence than it can be done by truftees, who 
have no other workmen to employ, but fuch as 
derive their whole fubfiftence from their wages. 
A great revenue, half a million, perhaps *, it has 
been pretended, might in this manner be gained, 
without laying any new burden upon the people ; 
and the turnpike roads might be made to contri- 
bute to the general expence of the ftate, in the fame 
manner as the poft-office does at prefent. 

THAT a confiderable revenue might be" gained 
in this manner, I have no doubt, though probably 
not near fo much, as the projectors of this plan 
have fuppofed. The plan itfelf, however, feems 
liable to feveral very important objections. 

FIRST, if the tolls which are levied at the 
turnpikes fhould ever be confidered as one of 
the refources for fupplying the exigencies of the 
ftate, they would certainly be augmented as thofe 
exigencies were fuppofed to require. According 
to the policy of Great Britain, therefore, they 

* Since publifliing the two firfl editions of this book, I have 
got good reafons to believe that all the turnpike tolls levied in 
Great Britain do not produce a neat revenue that amounts to 
half a million ; , a fum which, under the management of Go- 
vernment, would not be fufficient to keep in repair five of the 
principal roads in the kingdom. 

H 2 Would 



io THE NATURE AND CAUSES OF 

BOOK would probably be augmented very faft. The 
facility with which a great revenue could be drawn 
from them, would probably encourage admini- 
flration to recur very frequently to this refource. 
Though it may, perhaps, be more than doubtful, 
whether half a million could by any ceconomy be 
faved out of the prefent tolls, it can fcarcely be 
doubted but that a million might be faved out of 
them, if they were doubled; and perhaps two 
millions, if they were tripled *. This great re- 
venue too might be levied without the appointment 
of a fmgle new officer to collect and receive it. But 
the turnpike tolls being continually augmented in 
this manner, inftead of facilitating the inland com- 
merce of the country, as at prefent, would fooia 
become a very great incumbrance upon it. The 
cxpence of tranfporting all heavy goods from one 
part of the country to another, would foon be fo 
much increafed, the market for all fuch goods, 
confequently, would foon be fo much narrowed, 
that their production would be in a great meafure 
difcouraged, and the mod important branches of 
the domeftic induftry of the country annihilated 
altogether. 

SECONDLY, a tax upon carriages in proportion 
to their weight, though a very equal tax when 
applied to the fole purpofe of repairing the 
roads, is a very unequal one, when applied to 
any other purpofe, or to fupply the common exi- 
gencies of the ftate. When it is applied to the 
fole purpofe above mentioned, each carriage is 

* I have now good reafons to believe that all thefe conjec- 
tural fums are by much tgo large. 

fuppofed 



THE WEALTH OF NATIONS. 101 

fuppofed to pay exactly for the wear and tear CHAP. 
which that carriage occafions of the roads. But 
when it is applied to any other purpofe, each car- 
riage is fuppofed to pay for more than that wear 
and tear, and contributes to the fupply of fome 
other exigency of the flate. But as the turnpike 
toll raifes the price of goods in proportion to 
their weight, and not to their value, it is chiefly 
paid by the confumers of coarfe and bulky, not 
by thofe of precious and light commodities. 
Whatever exigency of the ftate therefore this tax 
might be intended to fupply, that exigency would 
be chiefly fupplied at the expence of the poor, 
not of the rich ; at the expence of thofe who are 
lead able to fupply it, not of thofe who are moft 
able. 

THIRDLY, if government fhould at any time 
neglect the reparation of the high roads, it would 
be ftill more difficult, than it is at prefent, to 
compel the proper application of any part of 
the turnpike tolls. A large revenue might thus 
be levied upon the people, without any part of 
it being applied to the only purpofe to which a 
revenue levied in this manner ought ever to be 
applied. If the meannefs and poverty of the 
truftees of turnpike roads render it fometimes 
difficult at prefent to oblige them to repair their 
wrong ; their wealth and greatnefs would render 
it ten times more fo in the cafe which is here 
fuppofed. 

IN France, the funds deftined for the repa- 
ration of the high roads are under the immediate 
direction of the executive power. Thofe funds 
H 3 confift, 




THE NATURE AND CAUSES OF 

BOOK confift, partly in a certain number of days labour 
wtiich <the country people are in mofl parts of 
Europe obliged to give to the reparation of the 
highways ; and partly in fuch a portion of the ge- 
neral revenue of the ftate as the king chufes to 
fpare from his other expences, 

BY the antient law of France, as well as by 
that of mofl other parts of Europe, the labour 
of the country people was under the direction of 
a local or provincial niagiftracy, which had no 
immediate dependency upon the king's council. 
But by the prefent praciice both the labour of 
the country people, and whatever other fund the 
king may chufe to affign for the reparation of 
the high roads in any particular province or ge- 
nerality, are entirely under the management of 
the intendant ; an officer who is appointed and 
removed by the king's council, who receives his 
orders from it, and is in conftant correfpondence 
with it. In the progrefs of defpotifm the au- 
thority of the executive power gradually abforbs 
that of every other power in the (late, and af- 
fumes to itfelf the management of every branch 
of revenue which is deflined for any public pur- 
pofe. In France, however, the great pofl-roads, 
the roads which make the communication be- 
tween the principal towns of the kingdom, are 
in general kept in good order ; and in fome 
provinces are even a good deal fuperior to the 
greater part of the turnpike roads of England, 
But what we call the crofs roads, that is, the 
far greater part of the roads in the country, are 
entirely neglected, and are in many places abfp- 

lutely 



THE WEALTH OF NATIONS. 103 

lately impafiable for any heavy carriage. In CHAP. 
fome places it is even dangerous to travel on 
horfeback, and mules are the only conveyance 
which can fafely be trufted. The proud mini- 
fter of an often tatious court may frequently take 
pleafure in executing a -work of fplendour and 
magnificence, fuch as a great highway, which is 
frequently feen by the principal nobility, whofe 
applaufes not only flatter his vanity, but even 
contribute to fupport his intereft at court. But 
to execute a great number of little works, in 
which nothing that can be done can make any 
great appearance, or excite the fmalleft degree 
of admiration in any traveller, and which, in 
fhort, have nothing to recommend them but 
their extreme utility, is a bufmefs which appears 
in every refpeft too mean and paltry to merit 
the attention of fo great a magiftrate. Under 
fuch an adminiftration, therefore, fuch works are 
almoft always entirely neglected. 

IN China, and in feveral other governments 
of Afia, the executive power charges itfelf both 
with the reparation of the high roads, and with 
the maintenance of the navigable canals. In 
the inftruclions which are given to the governor 
of each province, thofe objects, it is faid, are 
conftanily recommended to him, and the judg- 
ment which the court forms of his conduct is 
very much regulated by the attention which he 
appears to have paid to *this part of his inftruc- 
tions. This branch of public police accordingly 
is faid to be very much attended to in all thofe 
ouiitries ? but particularly in China, where the 

H 4 high 



104 THE NATURE A&D CAUSES OF 

BOOK high roads, and ftill more the navigable canals, 
it is pretended, exceed very much every thing of 
the fame kind which is known in Europe. The 
accounts of thofe works, however, which have 
been tranfmitted to Europe, have generally been 
drawn up by weak ' and wondering travellers ; 
frequently by ftupid and lying miflionaries. If 
they had been examined by more intelligent eyes, 
and if the accounts of them had been reported 
by more faithful witneffes, they would not, per- 
haps, appear to be fo wonderful. The account 
which Bernier gives of fome works of this kind 
in Indoftan, falls very much fhort of what had 
been reported of them by other travellers, more 
difpofed to the marvellous than he was. It may 
too, perhaps, be in thofe countries, as it is in 
France, where the great roads, the great com- 
munications which are likely to be the fubjecls 
of converfation at the court and in the capital, 
are attended to, and all the reft neglected. In 
China, befides, in Indoftan, and in feveral other 
governments of Afia, the revenue of the fove- 
reign arifes almoft altogether from a land-tax or 
land-rent, which rifes or falls with the rife and 
fall of the annual produce of the land. The 
great intereft of the fovereign, therefore, his re- 
venue, is in fuch countries neceflarily and im- 
mediately connected with the cultivation of the 
land, with the greatnefs of its produce, and with 
the value of its produce. But in order to render 
that produce both as great and as valuable as 
poflible, it is neceflary to procure to it as exten- 
five a market as poilible, and confequently to 

eftablilh 



THE WEALTH OF NATIONS. . lft 

eftablifh the freeft, the eafieft, and the lead ex- c H A p 
penfive communication between all the different 
parts of the country ; which can be done only 
by means of the beft roads and the bed navi- 
gable canals. But the revenue of the fovereign 
does not, in any part of Europe, arife chiefly from 
a land-tax or land-rent. In all the great king- 
doms of Europe, perhaps, the greater part of it 
may ultimately depend upon the produce of the 
land : But that dependency is neither fo imme- 
diate, nor fo- evident. In Europe, therefore, the 
fovereign does not feel himfelf fo directly called 
upon to promote the increafe, both in quantity 
and value, of the produce of the land, or, by 
maintaining good roads and canals, to provide 
the moil extenfive market for that produce. 
Though it mould be true, therefore, , what I ap- 
prehend is not a little doubtful, that in fome 
parts 'of Afia this department of the public 
police is very properly managed by the execu- 
tive power, there is not the leaft probability 
that, during the prefent ftate of things, it could 
be tolerably managed by that power in any part 
of Europe. 

EVEN thofe public works which are of fuch a 
nature that they cannot afford any revenue for 
maintaining themfelves, but of which the con- 
veniency is nearly confined to fome particular 
place or diftricl, are always better maintained by 
a local or provincial revenue, under the manage- 
ment of a local and provincial adminiflration, 
than by the general revenue of the ftate, of which 
the executive power muft always have the ma- 
nagement. 



io6 THE NATURE AND ^CAUSES OF 

BOOK nagement. Were the ftreets of London to be 
lighted and paved at the expence of the treafury, 
is there any probability that they would be fo 
well lighted and paved as they are at prefent, or 
even at fo fmall an expence ? The expence, be- 
fides, inftead of being raifed by a local tax upon 
the inhabitants of each particular ftreet, parifh, or 
diftrict in London, would, in this cafe, be de- 
frayed out of the general revenue of the Hate, and 
would confequently be raifed by a tax upon all the 
' inhabitants of the kingdom, of whom the greater 
part derive no fort of benefit from the lighting and 
paving of the ftreets of London. 

THE abufes which fometimes creep into the 
local and provincial adminiftration of a local and 
provincial revenue, how enormous foever they 
may appear, are in reality, however, almoft al- 
ways very trifling, in comparifon of thofe which 
commonly take place in the adminiftration and 
expenditure of the revenue of a great empire. 
They are, befides, much more eafily corrected. 
Under the local or provincial adminiftration of 
the juftices of the peace in Great Britain, the fix 
days labour which the country people are obliged 
to give to the reparation of the highways, is not 
always perhaps very judicioufly applied, but it 
is fcarce ever exacted with any circumftance of 
cruelty or oppreffion. In France, under the 
adminiftration of the intendants, the application. 
is not always more judicious, and the exaction is 
frequently the rnoft cruel and oppreffive. Such 
Corvees, as they are called, make one of the 
principal inftruments of tyranny by which thofe 

* officers 



THE WEALTH OF NATIONS. 207 

officers chaftife any parifh or communeaute which CHAP. 
has had the misfortune to fall under their dif- 
pleafure. 



Of the Public Works and Inftitutions wbicb are 
necefjary for facilitating particular Branches of 
Commerce. 

THE object of the public works and inftitu- 
tions above-mentioned is to facilitate commerce 
in general. But in order to facilitate fome par- 
ticular branches of it, particular inftitutions are 
neceffary, which again require a particular and 
extraordinary expence. 

SOME particular branches of commerce, which 
are carried on with barbarous and. uncivilized 
nations, require extraordinary protection. An 
ordinary ftore or counting-houfe could give lit- 
tle fecurity to the goods of the merchants who 
trade to the weftern coafl of Africa. To defend 
them from the barbarous natives, it is necefiary 
that the place where they are depofited, mould 
be, in fome meafure, fortified. The diforders 
in the government of Indoftan have been fup- 
pofed to render a like precaution neceflary even 
among that mild and gentle people ; and it was 
under pretence of fecuring their perfons and pro- 
perty from violence, that both the Englifh and 
French Eaft India Companies were allowed to 
erect the firft -forts which they poffefled in that 
country. Among other nations, whofe vigorous 
government will fuffer no ftrangers to poflefs 

any 



to & THE NATURE AND CAUSES OF 

ROOK any fortified place within their territory, it may- 
be neceffary to maintain fome ambaffador, mi- 
nifter, or conful, who may both decide, accord- 
ing to their own cuftoms, the differences arifing. 
among his own countrymen ; and, in their 
difputes with the natives, may, by means of his 
public character, interfere with more authority, 
and afford them a more powerful protection, than 
they could expect from any private man. The 
mterefts of commerce have frequently made it 
neceffary to maintain miniflers in foreign coun- 
tries, where the purpofes, either of war or al- 
jiance, would not have required any. The com- 
merce of the Turkey Company firft occafioned 
the eftablifhment of an ordinary ambaifador at 
Conftantinople. The firfl Engiifh embaflies to 
Ruffia arofe altogether from commercial interefts. 
The conflant interference with thofe interefts 
neceffarily occafioned between the fubjects of the 
different dates of Europe, has probably intro- 
duced the cufiom of keeping, in all neighbour- 
ing countries, amhaffadors or minifters conftantly 
refident even in the time of peace. This cufiom, 
unknown to antient times, feems not to be older 
than the end of the fifteenth or beginning of the 
fixteenth century ; that is, than the time when 
commerce firft began to extend itfelf to the greater 
part of the nations of Europe, and when they firfl 
began to attend to its interefts. 

IT feems not unreasonable, that the extra- 
ordinary expence, which the protection of any 
particular branch of commerce may occafion, 
fliould be defrayed by a moderate t ix upon that 
1 5 particular 



THE WEALTH 'OF NATIONS. 109 

particular branch ; by a moderate fine, for example, c H ^A i>. 
to be paid by the traders when they firfl enter into 
it, or, what is more equal, by a particular duty 
of fo much per cent, upon the goods which they 
either import into, or export out of, the particular 
countries with which it is carried on. The pro- 
tection of trade in general, from pirates and fre,e- 
booters, is faid to have given occafion to the firfl: 
inftitution of the duties of cuftoms. But, if it was 
thought reafonable to lay a general tax upon trade, 
in order to defray the expence of protecting trade 
in general, it mould feem equally reafonable to 
lay a particular tax upon a particular branch of 
trade, in order to defray the extraordinary expence 
of protecting that branch. 

THE protection of trade in general has always 
been confidered as efTential to the defence of the 
commonwealth, and, upon that account a ne- 
ceffary part of the duty of the executive power. 
The collection and application of the general 
duties of cuftoms, therefore, have always been 
left to that power. But the protection of any 
particular branch of trade is a part of the general 
protection of trade ; a part, therefore, of the duty 
of that power ; and if nations always acted con- 
fidently, the particular duties levied for the pur- 
pofes of fuch particular protection, mould always 
have been left equally to its difpofal. But in 
this refpect, as well as in many others, nations 
have not always acted confidently ; and in the 
greater part of the commercial ftates of Europe, 
particular companies 1 of merchants have had the 
addrcfs to pcriuade the legillature to entruft to 

them 



jio. THE NATURE AND CAUSES OF 

BOOK them the performance of this part of the duty of 
the fovereign, together with all the powers which 
are neceffarily connected with it. 

THESE' companies, though they may, perhaps, 
have been ufeful for the.firfl introduction of fome 
branches of commerce, by making, at their own 
expence, an "experiment which the flate might 
not think it prudent to make, have in the long- 
run proved, univerfally, either burdenfome or 
ufelefs, and have either mifmanaged or confined 
the trade. 

WHEN thofe companies do not trade upon a 
joint -flock, but are obliged to admit any perfon, 
properly qualified, upon paying a certain fine, 
and agreeing to fubmit to the regulations of the 
company, each member trading upon his own 
flock, and at hfs own riik, they are called re- 
gulated companies^ When they trade upon a 
joint flock, each member fharing in the common 
profit or lofs in proportion to his fhare in this 
flock, they are called joint flock companies. 
Such companies, whether regulated or joint 
flock, fometimes have, and fometimes have not 
exclufive privileges. 

REGULATED companies referable, in every 
refpect, the corporations of trades, fo common 
in the cities and towns of all the different coun- 
tries of Europe ; and are a fort of enlarged mo- 
nopolies of the fame kind. As no inhabitant of 
a town can exercife an incorporated trade, with- 
out firll obtaining his freedom in the corporation, 
fo in moil cafes no fubject of the flate can law- 
fully carry on any branch of foreign, trade,- for 

which 



THE WEALTH OF NATIONS, Iu 

"which a regulated company is eftabliftied, with- CHAP. 
out firfl becoming a member of that company. 
The monopoly is more or lefs Uriel according as 
the terms of admiffion are more or lefs difficult ; 
and according as the directors of the company 
have more or lefs authority, or have it more or 
lefs in their power to manage in fuch a manner 
as to confine the greater part of the trade to 
themfelves and their particular friends. In the 
moil antierit regulated companies the privileges 
of apprenticeihip weie the fame as in other cor- 
porations ; and entitled the perfon who had ferved 
his time to a member of the company, to become 
himfelf a member, either without paying any 
fine, or upon paying a much fmaller one than 
what was exacted of other people. The ufual 
corporation fpirit, wherever the law does not 
reftrain it, prevails in all regulated companies. 
When they have been allowed to act according 
to their natural genius, they have always, in order 
to confine the competition to as fmall a number 
of perfons as poflible, endeavoured to fubject 
the trade to many burdenfome regulations. 
When the law has reflrained them from doing 
this, they have become altogether ufelefs and in- 
fignificant. 

THE regulated companies for foreign com- 
merce, which at prefent fubfift in Great Britain, 
are, the antient merchant adventurers company, 
now commonly called the Hamburgh [Company, 
the Ruflia Company, the Eaftland ' Company, 
the Turkey Company, and the African Com- 
pany. 

THE 




THE NATURE AND CAUSES OF 



BOOK THE terms of dmiflion into the Harni 
v. 

Company are now faid to be quite eafy ; and 

the directors either have it not in their power to 
ftibjeft the trade to any burdenfome reftraint or 
regulations, or, at leafly have not of late exer- 
cifed that power. It has not always been fo. 
About the middle of the lad century, the fine for 
admiffion was fifty, and at one time one hundred 
pounds, and the conduct of the company was 
faid to be extremely oppreffive. In 1643, in 
1645, anc * m 1 66 1, the clothiers and free traders 
of the Weft of England complained of them to 
parliament, as of monopolifts who confined the 
trade and opprefled the manufactures of the 
country. Though thofe complaints produced 
no aft of parliament, they had probably inti- 
midated the company fo far, as to oblige them 
to reform their conduct. Since that time, at 
leaft, there have been no complaints againft them. 
By the loth and nth of William III. c. 6. the 
fine for admiffion into the Ruffian Company was 
reduced to five pounds; and by the 25th of 
Charles II. c. 7. that for admiflion into the Eaft- 
land Company, to forty millings, while, at the 
fame time, Sweden, Denmark, and Norway, all 
the countries on the north fide of the Baltic, 
were exempted from their exclufive charter. 
The conduct of thofe companies had probably 
given occafion to thofe two acts of parliament. 
Before that time, Sir Jofiah Child had repre-' 
fented both thefe and the Hamburgh Company 
as extremely oppreffive, and imputed to their 
bad management the low ftate of the trade, which 

we 



THE WEALTH OF NATIONS. 1*3 

We at that time carried on tcxthe countries compre- CHAP. 
hended within their refpe&ive charters. But though 
fuch companies may not, in the prefent times, be 
very oppreflive, they are certainly altogether ufe- 
lefs. To be merely ufelefs, indeed, is perhaps the 
highefl eulogy which can ever juftly be beflowed 
upon a regulated company ; and all the three 
companies above mentioned feem, in their prefent 
ftate, to deferve this eulogy. 

THE fine for admiffion into the Turkey Conu 
pany was formerly twenty-five pounds for all 
perfons under twenty-fix years of age^ and fifty 
pounds for all perfons above that age* Nobody 
but mere merchants could be admitted a re- 
ftriclion which excluded all mop-keepers and 
retailers. By a bye-law, no Britifli manufactures 
could be exported to 3 Turkey but in the general 
fliips of the company ; and as thofe mips failed 
always from the port of London, this reftri&ion 
confined the trade to that expenfiye port, and 
the traders to thofe who lived in London and 
in its neighbourhood. By another bye-law, no 
perfon living within twenty miles of London, 
and not free of the city, could be admitted a 
member > another reflriction, which, joined to 
the foregoing, neceifarily excluded all but the 
freemen of London. As the time for the load- 
ing and failing of thofe general fhips depended 
altogether upon the directors, they could eafily 
fill them with their own goods and thofe of their 
particular friends, to the exclufion of others, 
who, they might pretend, had made their pro- 
pofels too late. In this ftate of things, there- 
voj-. in. I fore, 




ii 4 THE NATURE AND CAUSES OF 

HOOK fore, this company^ was in every refpect a ftrict 
and oppreffive monopoly. Thofe abufes gave 
occafion to the aft of the 26th of George II. 
c. 1 3. reducing the fine for admiffion to twenty 
pounds for all perfons, without any diftinction 
of ages, or any reftriction, either to mere mer- 
chants, or to the freemen of London ; and 
granting to all fuch perfons the liberty of ex- 
porting, from all the ports of Great Britain to 
any port in Turkey, all Britifli goods of which 
the exportation was not prohibited ; and of im- 
porting from thence all Turkifh goods of which 
the importation was not prohibited, upon paying 
both the general duties of cuftoms, and the par- 
ticular duties aifefTed for defraying the neceffary 
expences of the company ; and fubmitting, at 
the fame time, to the lawful authority of the Bri- 
tifh ambaffador and confuls refident in Turkey, 
and to the bye-laws of the company duly en- 
acted. To prevent any oppreffion by thofe bye- 
laws, it was by jhe fame act ordained, that if 
any feven members of the company conceived 
themfelves aggrieved by any bye-law which 
ftould be enacted after the palling of this act, 
they might appeal to the Board of Trade and 
Plantations (to the authority of which, a com- 
mittee of the privy council has now fucceeded), 
provided fuch appeal was brought within twelve 
months after the bye-law was enacted ; and that 
if any feven members conceived themfelves ag- 
grieved by any bye-law which had been enacted 
before the pafling of this act, they might bring 
U like appeal, 'provider! it was within twelve 

months 



THE WEALTH OF NATIONS. -115 

months after the day on which this aft was to c H^A p. 
take place. The experience of one year, how- 
ever, may not always be fufficient to difcover to 
all the members of a great company the per- 
nicious tendency of a particular bye-law; and if 
feveral of them fhould afterwards difcover it, 
neither the Board of Trade, nor the committee 
of council, can afford them any redrefs. The 
object, befides, of the greater part of the bye-laws 
of all regulated companies, as well as of all 
other corporations, is not fo much to opprefs 
thofe who are already members, as to difcourage 
others from becoming fo ; which may be done, 
not only by a high fine, but by many other con- 
trivances. The conftant view of fuch companies 
is always to raife the rate of their own profit as 
high as they can ; to keep the market, both for 
the goods which they export, and for thofe 
which they import, as much underftocked as they 
can : which can be done only by reftraining the 
competition, or by difcouraging new adventurers 
from entering into the trade. A fine even of 
twenty pounds, befides, though it may not, per- 
haps, be fufficient to difcourage any man from 
entering into the Turkey trade, with an intention 
to continue in it, may be enough to difcourage 
a fpeculative merchant from hazarding a Jingle 
adventure in it. In all trades, the regular efta- 
blifhed traders, even though not incorporated, 
naturally combine to raife profits, which are no- 
xvay fo likely to be kept, at all tiraes, down to 
their proper level, as by the occafional compe- 
tition of fpeculative adventurers. The Turkey 
i a trade, 



n6 THE, NATURE AND CAUSES OF 

trade, though in forae meafure laid open by this 
aft of parliament, is flill confidered by many 
people as very far from being altogether free. The 
Turkey Company contribute to maintain an am- 
baflador and two or three confuls, who, like other 
public miniflers, ought to be maintained altoge- 
ther by the (late, and the trade laid open to all his 
majeflyVfubje&s. The different taxes levied by 
the company, for this and other corporation pur- 
pofes, might afford a [revenue much more than 
fufficient to enable the ftate to maintain fuch mi- 
niflers. 

REGULATED companies, it was obferved by 
Sir Jofiah Child, though they had frequently 
fupported public minifters, had never main- 
tained any forts or garrifons in the countries to 
which they traded ; whereas joint flock corcu 
panics frequently had. And in reality the former 
fecm to be much more unfit for this fort of fer- 
vice than the latter. Firfl, the directors of a 
regulated company have no particular interefl in 
the profperity of the general trade of the com- 
pany, for the fake of which, fuch forts and gar- 
rifons are maintained. The decay of that general 
trade may even frequently contribute to the ad- 
vantage of their own private trade ; as by di- 
minifliing the number of their competitors, it 
may enable them both to buy cheaper, and to fell 
dearer. The directors of a joint flock company, 
on the contrary, having only their fhare in the 
profits which are made upon the common flock 
committed to their management, have no private 
trade of their own, of which the intereft can be 

feparated 



THE WEALTH Of NATIONS. 11 

feparated from that of the general trade of the e HA p. 
company. Their private intereft is connected 
with the profperity of the general trade of the 
company ; and with the maintenance of the forts 
and garrifons which are neceflary for its defence. 
They are more likely, therefore, to have that 
continual and careful attention which that main- 
tenance neceflarily requires. Secondly, The 
directors of a joint flock company have always 
the management of a large capital, the joint 
{lock of the company, a part of which they may 
frequently employ, with propriety, in building, 
repairing, and maintaining fuch neceflary forts 
and garrifons. put the directors of a regulated 
company, having the management of no com* 
mon capital, have no other fund to employ in 
this way, but the cafual revenue arifmg from the 
admiffion fines, and from the corporation duties, 
impofed upon the trade of the company. Though 
they had the fame inter eft, therefore, to attend to 
the maintenance of fuch forts and garrifons, they 
can feldom have the fame ability to render that at- 
tention effectual. The maintenance of a public 
minifler requiring fcarce any attention, and but a 
moderate and limited, expence, is a bufmefs much 
more fuitable both to the temper and abilities of a 
regulated company. 

LONG after the time of Sir Jofiah Child, how- 
ever, in 1750, a regulated company was efta- 
blifhed, the prefent company of merchants trad- 
ing to Africa, which was exprefsly charged at 
fif ft with the maintenance of all the Britifh forts 
ajid garrifons that lie between Cape Blanc and 

13 the 




THB NATURE AND CAUSES OF 

the Cape of Good Hope, and afterwards with that 
of thofe only which lie between Cape Rouge and 
the Cape of Good Hope. The ad: which eftablifhes 
this company (the 23d of George II. c. 31.) feems 
to have had two diftinct objects in view ; firft, to 
reftrain effectually the oppreffive and monopolizing 
fpirit which is natural to the directors of a regu- 
lated company ; and, fecondly, to force them, as 
much as poffible, to give an attention, which is 
not natural to them, towards the maintenance of 
forts and garrifons. 

FOR the fir ft of thefe purpofes, the fine for 
admiflion is Jimited to forty millings. The com- 
pany is prohibited from trading in their corporate 
capacity, or upon a joint flock ; from borrowing 
rnoney upon common feal, or from laying any 
restraints upon the trade which may be carried 
on freely from all places, and by all perfons 
being Britiih fubjects, and paying the fine. The 
government is in a committee of nine perfons 
who meet at London, but who are chofen annu- 
ally by the freemen of the company at London, 
Briftol, and Liverpool ; three from each place. 
No committee-man can be continued in office for 
more than three years together. Any committee- 
man might be removed ^by the Board of Trade 
and Plantations ; now by a committee of council, 
after being heard in his own defence. The com- 
mittee are forbid to export negroes from Africa, 
or to import any African goods into Great Bri- 
tain. But as they are charged with the main- 
tenance of forts and garrifons, they may, for that 
purpole, export from Great Britain to Africa, 

goods 



THE WEALTH OF NATIONS. n 

goods and ftores of different kinds. Out of the c H A p. 
monies which they fhall receive from the com- 
pany, they are allowed a furn not exceeding eight 
hundred pounds for the falaries of their clerks 
and agents at London, Briftol, and Liverpool, the 
houfe-rent of their office at London, afid all 
other expences of management, commiffion and 
agency in England. What remains of this fum, 
after defraying thefe different expences, they may 
divide among themfelves, as compenfation for 
their trouble, in what manner they think proper* 
By this conftitution, it might have been ex- 
peded, that the fpirit of monopoly would have 
been effectually retrained, and the firft of thefe 
purpofes fufficiently anfwered. It would feem, 
however, that it had not. Though by the 4th 
of George III. c. 20. the fort of Senegal, with 
all its dependencies, had been vefted in the com- 
pany of merchants trading to Africa, yet in the 
year following (by the fth of George III. c. 44.), 
not only Senegal and its dependencies, but the 
whole coaft from the port of Sallee, in fouth 
Barbary, to Cape Rouge, was exempted from 
the jurifdiction of that company, was vefted in 
the crown, and the trade to it declared free to 
all his majefty's fubje&s. The company had 
been fufpeded of retraining the trade, and of 
eftablifhing fome fort of improper monopoly. It is 
not, however, very eafy to conceive how, under the 
regulations of the 23d George II. they could do fo, 
In the printed debates of the Houfe of Commons, 
not always the mod authentic records of truth, 
I obferve^ however, that they have been ac- 

1 4 cufed 



f2o THE NATURE AND CAUSES* OF 

BOOK cufed of this. The members of the committee 
of nine being all merchants, and the governors 
and factors in their different forts and fettle- 
ments being all dependent upon them, it is not 
unlikely that the latter might have given peculiar 
attention to the confignments and commiflions 
of the former, which would eftablifh a real mo- 
nopoly. 

FOR the fecond of thefe purpofes, the main-, 
tenance of the forts and garrifons, an annual fum 
has been allotted to them by parliament, gene- 
rally about i3,ooo/. For the proper application 
pf this fum, the committee is obliged to account 
annually to the Curfitor Baron of Exchequer ; 
which account is afterwards to be laid before 
parliament. But parliament, which gives fo 
little attention to the application of millions, is 
not likely to give much to that of 13,0007, 
a-year; and the Curfitor Baron of Exchequer, 
from his profeflion and education, is not likely to 
be profoundly Ikilled in the proper expence of 
forts and garrifons. The captains of his ma- 
jefty's navy, indeed, or any' other commiffioned 
officers, appointed by the Board of Admiralty, 
may enquire into the condition of the forts and 
garrifons, and report their obfervations to that 
board. But that board feems to have no direct 
jurifdi&ion over the committee, nor any autho- 
rity to cprre.ft thctfe wfrpfe conduct jt may thus 
enquire into ; and the captains of his majefty'fc 
navy, fcefides, are not fuppofed to be always 
deeply learned in the fcience of fortification. Re- 
moval from an office, which can be enjoyed onty 

for 



THE/WEALTH OF NATIONS. 121 

for the term of three years, and of which the CHAP. 
lawful emoluments, even during that term, arc 
fo very fmall, feems to be the utmoft punifh- 
ment to which any committee-man is liable, for 
any fault, except direct malverfation, or em- 
bezzlement, either of the public money, or of 
that of the company ; and the fear of that punifh- 
ment can never be a motive of fufficient weight 
to force a continual and careful attention to a 
bufmefs, to which he has no other intereft to 
attend. The committee are accufed of having 
fent out bricks and ftones from England for the 
reparation of Cape Coaft Caftle on the coafl of 
Guinea, a bufmefs for which parliament had 
feveral times granted an extraordinary fum of 
money. Thefe bricks and ftones too, which had 
thus been fent upon fo long a voyage, were faid 
to have been of fo bad a quality, that it was ne- 
cefiary to rebuild from the foundation the walls 
which had been repaired with them. The forts 
and garrifons which lie north of Cape Rouge, arc 
not only maintained at the expence of the ft ate, 
but are under the immediate government of the 
executive power ; and why thofe which lie fouth 
of that Cape, and which too are, in part at leaft, 
maintained at the expence of the ftate, mould be 
under a different government, it feems not very 
cafy even to' imagine a good reafon. The pro- 
tection of the Mediterranean trade was the ori- 
ginal purpofe or pretence of the garrifons of 
^Gibraltar and Minorca, and the maintenance and 
government of thofe garrifons have always been, 
Very properly, committed, not to the Turkey 

Company, 



THE NATURE AND CAUSES OF 

Company, but to the executive power. In the 
extent of its dominion confifls, in a great mea- 
fure, the ride and dignity of that power ; and 
it is not very likely to fail in attention to what is 
neceifary for the defence of that dominion. The 
garrifons at Gibraltar and Minorca, accordingly, 
have never been neglected; though Minorca has 
been twice taken, and is now probably loft for 
ever, that difafter was never even imputed to any 
neglect in the executive . power. I would not, 
however, be underftood to infmuate, that either 
of thofe expenfive garrifons was ever, even in the 
fmalleft degree, neceifary for the purpofe for 
\vhic~h they were originally difmembered from 
the Spariifh monarchy. That difmemberment, 
perhaps, never ferved any other real purpofe than 
to alienate from England her natural ally the, 
King of Spain, and to unite the two principal 
branches of the houfe of Bourbon in a much 
drifter and more permanent alliance than the ties 
of blood could ever have united them. 

x JOINT flock companies, eftablifhed either by 
royal charter or by aft of parliament, differ in 
feveral refpefts, not only from regulated compa- 
nies, but from private copartneries. 

FIRST, In a private copartnery, no partner, 
without the confent of the company, can trani- 
fer his fhare to another perfon, or introduce a 
new member into the company. Each member, 
however, may, upon proper warning, withdraw 
from the copartnery, and demand payment from- 
them of his fhare of the common flock. In a 
joint flock company, on the contrary, no member 
4 can 



THE WEALTH OF NATIONS. 

can demand payment of his (hare from the com- 
pany ; but each member can, without their con- 
fent, transfer his {hare to another 'perfon, and 
thereby introduce a new member. The value of 
a mare in a joint flock is always the price which 
it will bring in the market ; and this may be 
either greater or lefs in any proportion, than 
the fum which its owner (lands credited for in the 
flock of the company. 

SECONDLY, In a private copartnery, each part- 
ner is bound for the debts contracted by the com- 
pany to the whole extent of his fortune. In a joint 
flock company, on the contrary, each partner is 
bound only to the extent of his fliare. 

THE trade of a joint flock company is always 
managed by a court of directors. This court, 
indeed, is frequently fubjeft, in many refpe&s, 
to the controul of a general court of proprietors. 
But the greater part of thefe proprietors feldom 
pretend to underfland any thing of the bufmefs of 
the company ; and when the fpirit of faction hap- 
pens not to prevail among them, give them* 
felves no trouble about it, but receive content- 
edly fuch half-yearly or yearly* dividend, as the 
directors think proper to make to them. This 
total exemption from trouble and from rifk, be- 
yond a limited fum, encourages many people to 
become adventurers in joint flock companies, who 
would, upon no account, hazard their fortunes 
in any private copartnery.. Such companies, 
therefore, commonly draw to themfelves much 
greater flocks than any private copartnery can 
boaft of. The trading flock of the South Sea 

Company, 



124 THE NATURE AND CAUSES OF 

B CH& K Company, at one time, amounted to upwards of 
thirty-three millions eight hundred thoufand 
pounds. The divided capital of the Bank of 
England amounts, at r efent, to ten millions 
feven hundred and eight- *houfand pounds. The 
directors of fuch com- ;, however, being the 
managers rather of othc. people's money than of 
their own, it cannot well be expected, that they 
ihould watch over it with the fame anxious vi- 
gilance with which the partners in a private co- 
partnery frequently watch over their own. Like 
the flewards of a rich rnan> they are apt to con- 
fider attention to fmall matters as not for their 
matter's honour, and very eafily give themfelves 
a difpenfation from having it. Negligence and 
profufion, therefore,, muft always prevail, more 
or lefs, in the management of the affairs of fuch 
a company. It is upon this account that joint 
flock companies for foreign trade have feldom 
been able, to maintain the competition againft 
private adventurers. They have, accordingly, 
very feldom fucceeded without an exclufive ^>ri, 
vilege; and frequently have not fucceeded with 
one. Without an exclufive privilege they have 
commonly mifnianaged the trade. With an ex- 
clufive privilege they have both mifmanaged and 
confined it. 

THE Royal African Company, the predecefibr 
of the prefent African Company, had an exclu- 
five privilege by charter ; but as that charter had 
not been confirmed by act of parliament, the 
trade, in confequence of the declaration of 
rights, was, foon after the revolution, laid open 

to 



THE WEALTH OF NATIONS. 11$ 

to all his majefly's fubjefts. The Hudfon's Bay c n\ P, 
Company are, as to their legal rights, in the 
fame iituation as the Royal African Company. 
Their exclufive charter has not been confirmed 
by acl: of parliament. The South Sea Company, 
as long as they continued to be a trading com- 
pany, had an exclufive privilege confirmed by 
acl: of parliament; as have likewife the prefent 
United Company of Merchants trading to the 
Eaft Indies. 

THE Royal African Company foon found that 
they could not maintain the competition againft 
private adventurers, whom, notwithftanding the 
declaration of rights, they continued for fome 
time to call interlopers, and to perfecute as fuch. 
In 1698, however, the private adventurers were 
fubjeded to a duty of ten per cent, upon almoft 
all the different branches of their trade, to be 
employed by the company in the maintenance of 
their forts and garrifons. But, notwithftanding 
this heavy tax, the company were flill unable to 
maintain the competition. Their ftock and 
credit gradually declined. In 1712, their debts 
had become fo great, that a particular acl: of par- 
liament was thought neceflary, both for their 
fecurity and for that of their creditors. It was 
enafted, that the refolution of two-thirds of thefe 
creditors in number and value, fnould bind the 
reft, both with regard to the time which fhould 
be allowed to the company for the payment of 
their debts ; and with regard to any other agree- 
ment which it might be thought proper to make 
with them concerning thofe debts- In 1730, 

their 



ji6 f.HE NATURE AND CAUSES OF 

BOOK their affairs were in fo great diforder, that they 
were altogether incapable of maintaining their 
forts and garrifons, the fole purpofe and pretext 
of their inftitution. From that year, till their 
final diflblution, the parliament judged it ne- 
cefiary to allow the annual fum of ten thoufand 
pounds for that purpofe. In 1732, after having 
been for many years Jofers by the trade of carry- 
ing negroes to the Weft Indies, they at laft re- 
folved to give it up altogether ; to fell to the 
private traders to America the negroes which 
they purchafed upon the coaft; and to employ 
their fervants in a trade to the inland parts of 
Africa for gold duft, elephants teeth, dying 
drugs, &c. But their fuccefs in this more con- 
fined trade was not greater than in their former 
extenfive one. Their affairs continued to go gra- 
dually to decline, till at laft, being in every 
refpecl a bankrupt company, they were diflblved 
by act of parliament, and their forts and gar- 
rifons vefted in the prefent regulated company of 
merchants trading to Africa. Before the erec- 
tion of the Royal African Company, there had 
been three other joint ftock companies fuccefiively 
eftablifhed, one after another, for the African 
trade. They Were all equally unfuccefsful. They 
all, however, had exclufive charters, which, 
though not confirmed by aft of parliament, were 
in thofe days fuppofed to convey a real exclulive 
privilege. 

THE Hudfon's Bay Company, before their mif- 
fortunes in the late war, had been much more for- 
tunate than the Royal African Company. Their 

neceflary 



THE WEALTH OF NATIONS. 127 

neceffary expence is much fmaller. The whole c H A p 
number of people whom they maintain in their 
different fettlements and habitations, which they 
have honoured with the name of forts, is faid not 
to exceed a hundred anfi twenty perfons. This 
number, however, is fufficient to prepare before- 
hand the cargo of furs and other goods neceflary 
for loading their mips, which, on account of the 
ice, can feldom remain above fix or eight weeks 
in thofe feas. This advantage of having a cargo 
ready prepared, could not for feveral years be 
acquired by private adventurers, and without it 
there feems to be no pofTibility of trading to Hud- 
fon's Bay. The moderate capital of the- com- 
pany, which it is faid, does not exceed one hun- 
dred and ten thoufand pounds, may befides be 
fufficient to enable them to engrofs the whole, 
or almoft the whole, trade and furplus produce 
of the miferable, though extenfive country, com- 
prehended within their charter. No private ad- 
venturers, accordingly, haver ever attempted to 
trade to that country in competition with them. 
This company, therefore, have always enjoyed an 
exclufive trade in fa6t, though they may have no 
right to it in law. Over and above all this, the 
moderate capital of this company is faid to be 
divided among a very fmall number of proprie- 
tors. But a joint ilock company, confiding of 
a fmall number of proprietors, with a moderate 
capital, approaches very nearly to the nature of 
a private coparmery, arid may be capable of 
nearly the fame degree of vigilance and atten- 
tion. It is not to be wondered at, therefore, if, 

in 



13 j THE NATURE AND CAUSES OP 

BOOK in confequence of thefe different advantages, the 
Hudfon's Bay Company had, before the late war, 
been able to carry on their trade with a confider- 
able degree of fuccefs. It does not feeni pro- 
bable, however, that their profits ever approached 
to what the late Mr* Dobbs imagined them. A 
much more fober and judicious writer, Mr. An- 
derfon, author of The Hiflorical and Chronolo- 
gical Deduction of Commerce, very juflly ob- 
ferves, that upon examining the accounts which 
Mr. Dobbs himfeif has given for fever al years 
together, of their exports and imports, and upon 
making proper allowances for their extraordinary 
rifk and expence, it does not appear that their 
profits deferve to be envied, or that they can 
much, if at all, exceed the ordinary profits of 
trade. 

THK South Sea Company never had any forts 
or garrifons to maintain, and therefore were en- 
tirely exempted from one great expence, to which 
other joint flock companies for foreign trade are 
fubject. But they had an immenfe capital dr- 
vided among an immenfe number of proprietors. 
It was naturally to be expected, therefore, that 
folly, negligence, and profufion mould prevail in 
the whole management of their affairs. The 
knavery and extravagance of their flock-jobbing 
projects are fufficiently known, and the explica- 
tion of them would be foreign to the prefent 
fubject. Their mercantile projects were not 
much better conducted. The firft trade which 
they engaged in was that of fupplying the Spa-? 
Well Indies with negroes, of which (in con- 
1 2 fequence 



THE WEALTH OF NATIONS. 129 

fequence of what was called the Affiento contract c H^A p. 
granted them by the treaty of Utrecht) they had 
the exclufive privilege. But as it was not ex- 
pected that much profit could be made by this 
trade, both the Portugueze and French compa- 
nies, who had enjoyed it upon the fame terms 
before them, having been ruined by it, they were 
allowed, as compenfation, to fend annually a fhip 
of a certain burden to trade directly to the Spa- 
ni(h Weft Indies. Of the ten voyages which 
this annual fhip was allowed to make, they ar 
faid to have gained confiderably by one, that of 
the Royal Caroline in 1731, and to have been 
lofers, more or lefs, by almoft all the reft. 
Their ill fuccefs was imputed, by their factors 
and agents, to the extortion and oppreffion of 
the Spanifh government ; but was, perhaps, prin- 
cipally owing to the profufion and depredations 
of thofe very factors and agents ; fome of whom 
are faid to have acquired great fortunes even in 
one year. In 1734, the company petitioned the 
king, that they might be allowed to difpofe of 
the trade and tonnage of their annual (hip, on 
account of the little profit which they made by it, 
and to accept of fuch equivalent as they could ob- 
tain from the king of Spain. 

IN 1724, this company had undertaken the 
whale fifhery. Of this, indeed, they had no 
monopoly ; but as long as they carried it on, no 
other Britifh fubjects appear to have engaged in 
it. Of the eight voyages which their mips 
irtade to Greenland, they were gainers by one, 
and lofers by all the reft. After their eighth 
and laft voyage, when they had fold their ihips, 

vol. in, x, ftores, 



, 5 o THE NATURE AND CAUSES OF 

BOOK (lores, and utenfils, they found that their whole 
lofs, upon this branch, capital and intereil in- 
cluded, amounted to upwards of two hundred and 
thirty-feven thoufand pounds. 

IN 1722, this company petitioned the parlia- 
ment to be allowed to divide their immenfe 
capital of more than thirty-three millions eight 
hundred thoufand pounds, the whole of which 
had been lent to government, into two equal 
parts : The one half, or upwards of fixteen mil- 
lions nine hundred thoufand pounds, to be put 
upon the fame footing with other government 
annuities, and not to be fubjecl to the debts con- 
tracted, or loffes incurred, by the directors of the 
company, in the profecution of their mercantile 
projects ; the other half to remain as before, 
a trading flock, and to be fubject to thofe debts 
and lolfes. The petition was too reafonable not 
to be granted. In 1733, they again petitioned 
the parliament, that three-fourths of their trading 
flock might be turned into annuity flock, and 
only one-fourth remain as trading flock, or ex- 
pofed to the hazards arifing from the bad ma- 
nagement of their directors. Both their annuity 
and trading flocks had, by this time, been re* 
duced more than two millions each, by feveral 
different payments from government ; fo that 
this fourth amounted only to 3,662,784!. 8s. 6d. 
In 1748, all the demands of the company upon 
the king of Spain, m confequence of the Afliento 
contract, were, by the treaty of Aix-la-Chapelle, 
given up for what was fuppofed an equivalent. 
An end was put to their trade with the Spanifh 
Weft Indies, the remainder of their trading 

flock 



THE WEALTH OF NATIONS. 13 

ftock was turned into an annuity flock, and the CHAP, 
company ceafed in every refpeft to be a trading 
company. 

IT ought to be obferved, that in the trade which 
the South Sea Company carried on by means of 
their annual fhip, the only trade by which it ever 
was expeded that they could make any confider- 
able profit, they were not without competitors, 
either in the foreign or in the home market. At 
Carthagena, Porto Bello, and La Vera Cruz, 
they had to encounter the competition of the Spa- 
nifh merchants, who brought from Cadiz, to thofe 
markets, European goods, of the fame kind with 
the outward cargo of their fhip ; and in England 
they had to encounter that of the Englifh mer- 
chants, who imported from Cadiz goods of the 
Spanifh Weft Indies, of the fame kind with the 
inward cargo. The goods both of the Spanifh 
and Englifh merchants, indeed, were, perhaps, 
fubjeft to higher duties. But the lofs occafioned 
by the negligence, profufion, and malverfation of 
the fervants of the company, had probably been a 
tax much heavier than all thofe duties. That a 
joint ftock company mould be able to carry on 
fuccefsfully any branch of foreign trade, when 
private adventurers can come into any fort of open, 
and fair competition with them, feems contrary to 
all experience. 

THE old Englifh Eaft India Company was 
cftablifhed in 1600, by a charter from Queen 
Elizabeth. In the iirft twelve voyages which they 
fitted out for India, they appear to have traded as 
a regulated company, with feparate flocks, though 
K ? only 




THE NATURE AND CAUSES OF 

only in the general fhips of the company. In 
1612, they united into a joint flock. Their char- 
ter was exclufive, and though not confirmed by 
acl of parliament, was in thofe days fuppofed to 
convey a real exclufive privilege. For many years, 
therefore, they were not much diflurbed by inter- 
lopers. Their capital, which never exceeded feven 
hundred and forty-four thoufand pounds, and of 
xvhich fifty pounds was a mare, was not fo exorbi- 
tant, nor their dealings fo extenfive, as to afford 
either a pretext for grofs negligence and profufion, 
or a cover to grofs malverfation. Notwithflanding 
Ibme extraordinary lofTes, occafioned partly by the 
malice of the Dutch Eaft India Company, and 
partly by other accidents, they carried on for many 
years a fuccefsful trade. But in procefs of time, 
when the principles of liberty were better under- 
ftood, it became every day more and more doubt- 
ful how far a royal charter, not confirmed by aft 
of parliament, could convey an exclufive privilege. 
Upon this queflion the decifions of the courts of 
juftice were not uniform, but varied with the 
authority of government and the humours of the 
times. Interlopers multiplied upon them ; and 
towards the end of the reign of Charles II, 
through the whole of that of James II. and du- 
ring a part of that of William III. reduced them, 
to great diftrefs. In 1698, a propofal was made 
to parliament of advancing two millions to go- 
vernment at eight per cent provided the fub- 
fcribers were ereded into a new Eaft India Com- 
pany with exclufive privileges. The old Eaft 
India Cpmpany offered feven hundred thoufand 

pounds, 



THE WEALTH OF NATIONS. 133 

pounds, nearly the amount of their capital, at four CHAP. 
per cent, upon the fame conditions. But fuch was 
at that time the ftate of public credit, that it was 
more convenient for government to borrow two 
millions at eight per cent, than feven hundred 
thoufand pounds at four. The propofal of the 
new fubfcribers was accepted, and a new Eaft 
India Company eftablifhed in confequence. The 
old Eaft India Company, however, had a right 
to continue their trade till 1701. They had, at 
the fame time, in the name of their treafurer, fub- 
fcribed very artfully, three hundred and fifteen 
thoufand pounds into the ftock of the new. By a 
negligence in the expreffion of the ad of parlia- 
ment, which vefted the Eaft India trade in the fub- 
fcribers to this loan of two millions, it did not 
appear evident that they were all obliged to unite 
into a joint ftock. A few private traders, whofe 
fubfcriptions amounted only to feven thoufand two 
hundred pounds, infifted upon the privilege of 
trading feparately upon their own (locks and at 
their own rifk. The old Eaft India Company had 
a right to a feparate trade upon their old ftock till 
1701 ; and they had likewife, both before and 
after that period, a right, like that of other pri- 
vate traders, to a feparate trade upen the three 
hundred and fifteen thoufand pounds, which they 
had fubfcribed into the ftock of the new com- 
pany. The competition of the two companies 
with the private traders, and with one another, is 
faid to have well nigh ruined both. Upon a fub- 
fequent occafjon, in 1730, when a propofal was 
niade to parliament for putting the trade under 
K the 




THE NATURE AND CAUSES PF 

the management of a regulated company, and 
thereby laying it in fome itieafure open, the Eait 
India Company, in oppofition to this propofal, 
reprefented in very ftrong terms, what had been, 
at this time, the miferable effects, as they thought 
them, of this competition. In India, they faid ? 
it raifed the price of goods fo high, that they were 
not worth the buying ; and in England, by over- 
flocking the market, it funk their price fo low, 
that no profit could be made by them. That by a 
more plentiful fupply, to the great advantage and 
conveniency of the public, it muft have reduced, 
very much, the price of India goods in the Englifh 
market, cannot well be doubted ; but that it fhould 
have raifed very much their price in the Indian 
market, feems not very probable, as, all the ex- 
traordinary demand which that competition could 
occafion, mufl have been but as a drop of water 
in the immenfe ocean of Indian commerce. The 
increafe of demand, befides, though in the begin- 
ning it may fometimes raife the price of goods, 
never fails to lower it in the long run. It encou- 
rages production, and thereby increafes the com- 
petition of the producers, who, in order to under- 
fell one another, have recourfe to new divifions of 
labour and new improvements of art, which might 
never otherwife have been thought of. The 
miferable effects of which the company com- 
plained, were the cheapnefs of confumption 
and the encouragement given to production, pre- 
cifely the two effects which it is the great bu- 
fmefs of political ceconomy to promote. The 
competition, however, of which they gave this 

'doleful 



THE WEALTH OF NATIONS. 

doleful account, had not been allowed to be of c H A P. 
long continuance. In 1702, the two companies 
were, in fome meafure, united by an indenture 
tripartite, to which the queen was the third party ; 
and in 1708, they were, by act of parliament, per- 
fectly confolidated into one company by their 
prefent name of The United Company of Mer- 
chants trading to the Eafl Indies. Into this act 
it was thought worth while to infert a claufe, al- 
lowing the feparate traders to continue their trade 
till Michaelmas 1711, but at the fame time em- 
powering the directors, upon three years notice, 
to redeem their little capital of feven thoufand 
two hundred pounds, and thereby to convert the 
whole flock of the company into a joint flock. 
By 'the fame act, the capital of the company, in 
confequence of a new loan to government, was 
augmented from two millions to three millions 
two hundred thoufands pounds. In 1743, the 
company advanced another million to govern- 
ment. But this million being raifed, not by a 
call upon the proprietors, but by felling annuities 
and contracting bond-debts, it did not augment 
the flock upon which the proprietors could claim 
a dividend. It augmented, however, their trading 
flock, it being equally liable with the other three 
millions two hundred thoufand pounds to the 
lofies fuflained, and debts contracted, by the 
company in profecution of their mercantile pro- 
jects. From 1708, or at leafl from 1711, this 
company, being delivered from all competitors, 
and fully eflablifhed in the monopoly of the 
Englifli commerce to the Eaft Indies, carried on 
a luccefsful trade, and from their profits made 
K 4 annually 



i$6 THE NATURE AND CAUSES OF 

BOOK annually a moderate dividend to their proprie- 
tors. During the French war, which began hi 
1741, the ambition of Mr. Dupleix, the French 
governor of Pondicherry, involved them in the 
wars of the Carnatic, and in the politics of the 
Indian princes. After many fignal fuccefles, and 
equally fignal loffes, they at laft loft Madras, at 
that time their principal fettlement in India. It 
was reftored to them by the treaty of Aix-la* 
Chapelle ; and about this time the fpirit of war 
and conqueft feerns to have taken pofieffion of 
their fervants in India, and never fmce to have 
left them. During the French war which began 
in 1755) their arms partook of the general good 
fortune of thofe of Great Britain. They de- 
fended Madras, took Pondicherry, recovered 
Calcutta, and acquired the revenues of a rich 
arid extenfive territory, amounting, it was then 
faid, to upwards of three millions a-year. They 
remained for feveral years in quiet pofTeflion of 
this revenue: But in 1767, adminiflration laid 
claim to their territorial acquisitions, and the re- 
venue arifing from them, as of right belonging 
to the crown ; and the company, in compenfa- 
tion for this claim, agreed to pay to government 
four hundred thoufand pounds a-year. They 
had before this gradually augmented their divi- 
dend from about fix to ten per cent. ; that is, 
upon their capital of three millions two hundred 
thoufand pounds, they had increafed it by a hun- 
dred and twenty-eight thoufand pounds, or had 
taifed it from one hundred and ninety-two thou- 
fand, to three hundred and twenty thoufand 
pounds a-year. They were attempting about 

this 




THE WEALTH OF NATIONS. 137 

this time to raife it {till further, to twelve and a 
half per cent, which would have made their an- 
nual payments to their proprietors equal to what 
they had agreed to pay annually to government, 
or to four hundred thoufand pounds a-year. But 
during the two years in which their agreement 
with government was to take place, they were 
reflrained from any further increafe of dividend 
by two fucceffive acts of parliament, of which 
the object was to enable them to make a fpeedier 
progrefs in the payment of their debts, which 
were at this time eftimated at upwards of fix or 
feven millions fterling. In 1769, they renewed 
their agreement with government for five years 
more, and flipulated, that during the courfe of 
that period, they fhould be allowed gradually to 
increafe their dividend to twelve and a half per 
cent. ; never increafing it, however, more than 
one per cent, in one year. This increafe of di- 
vidend, therefore, when it had v rifen to irs utmoft 
height, could augment their annual payments, to 
their proprietors and government together, but 
by fix hundred and eight thoufand pounds, be- 
yond what they had been before their late terri- 
torial acquifitions. What the grofs revenue of 
thofe territorial acquifitions was fuppoled to 
amount to, has already been mentioned ; and: 
by an account brought by the Cruttenden Eait 
Indiaman in 1768, the nett revenue, clear of all 
deductions and military charges, was dated at 
two millions forty-eight thoufand feven hundred 
and forty-feven pounds. They were faid at the 
fame time to polfefs another revenue, arifmg 
partly from lands, but chiefly from the cuftoms 

eftablrfhed 



THE NATURE AND CAUSES OF 

BOOK eftablifhed at their different fettlements, amount- 
ing to four hundred and thirty-nine thoufand 
pounds. The profits of their trade, too, accord- 
ing to the evidence of their chairman before the 
Houfe of Commons, amounted at this time to 
at leaft four hundred thoufand pounds a-year ; 
according to that of their accomptant, to at leaffc 
five hundred thoufand; according to the loweft 
account, at lead equal to the higheft dividend 
diat was to be paid to their proprietors. So 
great a revenue might certainly have afforded an 
augmentation of fix hundred and eight thoufand 
pounds in their annual payments ; and at the fame 
time have left a large finking fund fufEcient for 
the fpeedy reduction of their debt. In 1773, 
however, their debts, inftead of being reduced, 
were augmented by an arrear to the treafury in 
the payment of the four hundred thoufand pounds, 
by another to the cuftom-houfe for duties unpaid, 
by a large debt to the bank for money borrowed, 
and by a fourth for bills drawn upon them from 
India, and wantonly accepted, to the amount of 
upwards of twelve hundred thoufand pounds. 
The diftrefs which thefe accumulated claims 
brought upon them, obliged them not only to 
reduce all at once their dividend to fix per cent, 
but to throw themfelves upon the mercy of go- 
vernment, and to fupplicate, firft, a releafe from 
the further payment of the ftipulated four hun- 
dred thoufand pounds a-year ; and, fecondly, .a 
loan of fourteen hundred thoufand, to fave them 
from immediate bankruptcy. The great increafe 
of their fortune had, it feems, only ferved to fur- 
nifn their fervants with a pretext for greater pro- 

fufion, 



THE WEALTH OF NATIONS. 139 

lufion, and a cover for greater malverfation, than CHAP, 
in proportion even to that increafe of fortune. 
The conduct of their fervants in India, and the 
general ftate of their affairs both in India and in 
Europe, became the fubject of a parliamentary 
inquiry : in confequence of which feveral very 
important alterations were made in the conftitu- 
tion of their government, both at home and 
abroad. In India, their principal fettlements of 
Madras, Bombay, and Calcutta, which had be- 
fore been altogether independent of one another, 
were fubjeded to a governor-general, afiifted by 
a council of four afleflbrs, parliament affuming 
to itfelf the firft nomination of this governor and 
council who were to refide at Calcutta ; that city 
having now become, what Madras was before, 
fhe moft important of the Englifh fettlements ia 
India. The court of the mayor of Calcutta, 
originally inftituted for the trial of mercantile 
caufes, which arofe in the city and neighbour- 
hood, had gradually extended its jurifdi&ion with 
the extenfion of the empire. It was now reduced 
and confined tp the original purpofe of its infti- 
tution. Inftead of it a new fupreme court of 
judicature was eftablifhed, confiding of a chief 
juftice and three judges to be appointed by the 
crown. In Europe the qualification neceflary to 
entitle a proprietor to vote at their general courts 
was raifed, from five hundred pounds, the ori- 
ginal price of a fhare in the ftock of the company, 
to a thoufand pounds. In order to vote upon 
this qualification too, it was declared neceflary, 
that he mould have poflefled it, if acquired by 
his own purchafe, and not by inheritance, for at 

lead 



i 4 o THE NATURE AND CAUSfeS OF 

BOOK leaft one year, inftead of fix months, the term 
requifite before. The court of twenty-four di- 
rectors had before been chofen annually ; but it 
was now enabled that each director fhould, for 
the future, be chofen for four years \ fix of them, 
however, to go out of office by rotation every 
year, and not to be capable of being re-chofen 
at the election of the fix new directors for the 
enfuing year. In confequence of thefe altera- 
tions, the courts, both of the proprietors and di- 
rectors, it was expected, would be likely to ad 
with more dignity and fteadinefs than they had 
ufually done before. But it feems impoflible, 
by any alterations, to render thofe courts, in any 
refpect, fit to govern, or even to fhare in the go- 
vernment of a great empire ; becaufe the greater 
part of their members muft always have too little 
intereft in the profperity of that empire, to give 
any ferious attention to what may promote it. 
Frequently a man of great, fometimes even a 
man of fmall fortune, is willing to purchafe a 
thoufand pounds fhare in India flock, merely for 
the influence which he expects to acquire by a 
vote in the court of proprietors. It gives him 
a fhare, though not in the plunder, yet in the ap- 
pointment of the plunderers of India ; the court 
of directors, though they make that appoint^ 
ment, being necefTarily more or leis under the 
influence of the proprietors, who not only elect 
thofe directors, but fometimes over-rule the ap- 
pointments of their fervants in India. Provided 
he can enjoy this influence for a few years, and 
thereby provide for a certain number of his 
friends, he frequently cares little about the di- 
vidend \ 



THE WEALTH OF NATION'S. i 4 i 

vidend ; or even about the value of the (lock c H A P. 
Upon which his vote is founded. About the 
profperity of the great empire, in the govern- 
ment of which that vote gives him a (hare, he 
feldom cares at all. No other fovereigns ever 
were, or, from the nature of things, ever could 
be, fo perfectly indifferent about the happinefe 
or inifery of their fubjects, the improvement or 
wafte of their dominions, the glory or difgrace of 
their admmiflration ; as, from irrefftlible moral 
caufes, the greater part of the proprietors of 
fuch a mercantile company are, and necefTarily 
mufl be. This indifference too was more likely 
to be increafed than diminifhed by fome of the 
new regulations which were made in confequence 
of the parliamentary inquiry. By a refolution of 
the Houfe of Commons, for example, it was de- 
clared, that when the fourteen hundred thoufand 
pounds lent to the company by government mould 
'be paid, and their "bond-debts be reduced to fifteen 
hundred thoufand pounds, they might then, and 
not till then, divide eight per cent, upon their 
capital ; and that whatever remained of their re- 
venues and nett profits at home, fhould be di- 
vided into four parts ; three of them to be paid 
into the exchequer for the ufe of the public, and 
the fourth to be referved as a fund, either for the 
further reduction of their bond-debts, or for the 
jlifcharge of other contingent exigencies, which 
the co'mpany might labour under. But if the 
company were bad ftewards, and bad fovereigns, 
when the whole of their nett revenue and profits 
belonged to themfelves, and were at their own 
difpofal, they were furely not likely to be better, 

when 



142 THE NATURE AND CAUSES OF 

BOOK when three-fourths of them were to belong to other 
people, and the other fourth, though to be laid 
out for the benefit of the company, yet to be fo, 
under the infpe&ion, and with the approbation, 
of other people. 

IT might be more agreeable to the company 
that their own fervants and dependants mould 
have either the pleafure of wafting, or the pro- 
fit of embezzling whatever furplus might remain, 
after paying the propofed dividend of eight per 
cent., than that it mould come into the hands of 
a fet of people with whom thofe refolutions could 
fcarce fail to fet them, in fome meafure, at va- 
riance. The intereft of thofe fervants and de- 
pendants might fo far predominate in the court 
of proprietors, as fometimes to difpofe it to fup- 
port the authors of depredations which had been 
committed, in direct violation of its own autho- 
rity. With the majority of proprietors, the fup- 
port even of the authority of their own court 
might fometimes be a matter of lefs confequence, 
than the fupport of thofe who had fet that autho- 
ity at defiance. 

THE regulations of 1773, accordingly, did 
not put an end to the diforders of the company's 
government in India. Notwithstanding that> 
during a momentary fit of good conduct, they 
had at one time collected, into the treafury of 
Calcutta, more than three millions flerling ; not- 
withftanding that they had afterwards extended, 
either their dominion, or their depredations over 
a vaft accefiion of fome of the richeft and moft 
fertile countries in India ; all was wafted and de- 
ftroyed. They found themfelves altogether un- 
prepared 



* THE WEALTH CTP NATIONS. 143 

prepared to flop or refift the incur fion of Hyder CHAP. 
AH ; and, in confequeuce of thofe diforders, the 
company is now (1784) in greater diftrefs than, 
ever ; and, in order to prevent immediate bank- 
ruptcy, is once more reduced to fupplicate the 
afiiflance of government. Different plans have 
been propofed by the different parties in parlia- 
ment, for the better management of its affairs; 
And all thofe plans feem to agree in fuppofing, 
what was indeed always abundantly evident, that 
it is altogether unfit to govern its territorial pof- 
fefllons. Even the company itfelf feems to be 
convinced of its own incapacity fo far, and feems, 
upon that account, willing to give them up to 
government. 

WITH the right of poffeflmg forts and garri- 
fons in diflant and barbarous countries, is necef- 
farily conneded the right of making peace and 
war in thofe countries. The joint ftock compa- 
nies which have had the one right, have conflantly 
exercifed the other, and have frequently had it 
exprefsly conferred upon them. How unjuflly, 
how capricioufly, how cruelly they have com- 
monly exercifed it, is too well known from recent 
experience. 

WHEN a company of merchants undertake, at 
their own rifk and expence, to eftablifh a new trade 
with fome remote and barbarous nation, it may 
not be unreaibnable to incorporate them into a 
joint flock company, and to grant them, in cafe 
of their fuccefs, a monopoly of the trade for a 
certain number of years. It is the eafieft and 
mod natural way in which the ftate can recom- 
p^nfe them for hazarding a dangerous and ex- 

penfive 



j 44 THE NATURE AND CAUSES OF 

BOOK penfive experiment, of which the public is after- 
wards to reap the benefit. A temporary mono- 
poly of this kind may be vindicated upon the 
fame principles upon which a like monopoly of 
a new machine is granted to its inventor, and 
that of a new book to its author. But upon the 
expiration of the term, the monopoly ought cer- 
tainly to determine ; the forts and garrifons, if 
it was found neceflary to eltabliih any, to be 
taken into the hands of government, their value 
to be paid to the company, and the trade to be 
laid open to all the fubjecls of the ftate. By a 
perpetual monopoly, all the other fubjects of the 
flate are taxed very abfurdly in two different 
ways ; firft, by the high price of goods, which, 
in the cafe of a free trade, they could buy much 
cheaper; and, fecondly, by their total exclufion 
from a branch of bufinefs which it might be 
both convenient and profitable for many of them 
to carry on. It is for the mod worthlefs of all 
purpofes too that they are taxed in this manner. 
It is merely to enable the company to fupport 
the negligence, profufion, and malverfation of 
their own fervants, whofe diforderly conduct fel- 
dom allows the dividend of the company to ex- 
ceed the ordinary rate of profit in trades which 
are altogether free, and very frequently makes it 
fall even a good deal fhort of that rate. With- 
out a monopoly, however, a joint flock com- 
pany, it would appear from experience, cannot 
long carry en any branch of foreign trade. To 
buy in one market, in order to fell, with profit, 
in another, when there are many competitors in 
both -y to \vatch over, not only the occafional 

6 variations 



THE WEALTH OF NATIONS. 

variations in the; demand, but the much greater and 
more frequent variations in the competition, or in 
the fupply which that demand is likely to get from 
other people, and to fuit with dexterity and judg- 
ment both the quantity and quality of each aflbrt- 
ment of goods to all thefe circumftances, is a fpecies 
of warfare of which the operations are continually 
changing, and which can fcarce ever be conduced 
fuccefsfully, without fuch an unremitting exertion 
of vigilance and attention, as cannot long be ex- 
peeled from the directors of a joint (lock company. 
The Eaft India Company, upon the redemption of 
their funds, and the expiration of their exclufive 
privilege, have a right, by act of parliament, to 
continue a corporation with a joint ftock, and to 
trade in their corporate capacity to the Eaft Indies 
in common with the reft of their fellow fubjects. 
But in this fituation, the fuperior vigilance and 
attention of private adventurers would, in all pro- 
bability, foon make them weary of the trade. 

AN eminent French author, of great know- 
ledge in matters of political ceconomy, the Abbe 
Morellet, gives a lift of fifty-five joint (lock 
companies for foreign trade, which have been 
eftablifhed in different parts of Europe fince the 
year 1600, and which, according to him, have 
all failed from mifmanagement, notwithftanding 
they had exclufive privileges. He has been mif- 
informed with regard to the hiftory of two or 
three of them, which were not joint ftock com- 
panies, and have not failed. But, in compenfa- 
tion, there have been feveral joint ftock compa- 
nies which have failed, and which he has omitted. 

VOL. in, JL, THB 





THE NATURE AND CAUSES -OF 

THE only trades which it feems pofiible for a 
joint flock company to carry on fuccefsfully, 
without an exclufive privilege, are thofe, of 
which all the operations are capable of being re- 
duced to what is called a routine, or to fuch a 
uniformity of method as admits of little or no va- 
riation. Of this kind is, firfl, the banking trade ; 
fecondly, the trade of infurance from fire, and from 
fea rifk a*nd capture in time of war ; thirdly, the 
trade of making and maintaining a navigable cut 
or canal ; and, fourthly, the fimilar trade of bring- 
ing water for the fupply of a great city. 

Ttiough the principles of the banking trade 
may appear fomewhat abflrufe, the practice is 
capable of being reduced to Uriel: rules. To 
depart upon any occafion from thofe rules, in 
confequence of fome flattering fpeculation of ex- 
traordinary gain, is almofl always extremely 
dangerous, and frequently fatal to, the banking 
company which attempts it. But the conftitu- 
tion of joint flock companies renders them in 
general more tenacious of eflablifhed rules than 
any private copartnery. Such companies, there- 
fore, feem extremely well fitted for this trade. 
The principal banking companies in Europe, ac- 
cordingly, are joint flock companies, many of 
which manage their trade very fuccefsfully with- 
out any exclufive privilege. The bank of Eng- 
land has no other exclufive privilege, except that 
no other banking company in England fhall confifl 
of more than fix perfons. The two banks of 
Edinburgh are joint flock companies without any 
exclufive privilege. 

THIS 



THE WEALTH OF NATIONS. 147 

THE value of the rifk, either from fire, or from C H A P. 
lofs by lea, or by capture, though it cannot, per- 
haps, be calculated very exactly, admits, how- 
ever, of fuch a grofs eftimation as renders it, in 
fome degree, reducible to flricl rule and method. 
The trade of infurance, therefore, may be carried 
on fuccefsfully by a joint flock company, without 
any exclufive privilege. Neither the London 
Affurancej nor the Royal Exchange AfTurance 
companies, have any fuch privilege. 

WHEN a navigable cut or canal has been once 
made, the management of it becomes quite fimple 
and eafy, and it is reducible to ftricl rule and me- 
thod* Even tlie making of it is fo, as it may be 
contracted for with undertakers at fo much a mile, 
and fo much a lock. The fame thing may be faid 
of a canal, an aqueduct, or a great pipe for bring- 
ing water to fupply a great city. Such under- 
takings, therefore, may be, and accordingly fre- 
quently are, very fuccefsfully managed by joint 
flock companies without any exclufive privilege. 

To eflablifh a joint flock company, however, 
for any undertaking, merely becaufe fuch a 
company might be capable of managing it fuc- 
cefsfully ; or to exempt a particular fet of dealers 
from fome of the general laws which take place 
with regard to all their neighbours, merely be- 
caufe they might be capable of thriving, if they 
had fuch an exemption, would certainly not be 
reafonable. To render fuch an eflablifhment 
perfectly 'reafonable, with the circum fiance of 
being reducible to flric~l rule and method, two 
other circumftances ought to concur. Firfl, it 
L 2 ought 




THE NATURE AND CAUSES OF 
ought to appear with the cleared evidence, that the 
undertaking is of greater and more general utility 
than the greater part of common trades ; and fe- 
condly, that it requires a greater capital than can 
eafily be collected into a private copartnery. If a 
moderate capital were fufficient, the great utility of 
the undertaking would not be a fufEcient reafon 
for eftabliihing a joint flock company ; becaufe, in 
this cafe, the demand for what it was to produce* 
would readily and eafily be fupplied by private ad- 
venturers. In the four trades above mentioned, 
both thofe circumftances concur. 

THE great and general utility of the banking 
trade when prudently managed, has been fully ex- 
plained in theTecond book of this Inquiry. But a 
publick bank which is to fupport public credit, and 
upon particular emergencies to advance to govern- 
ment the whole produce of a tax, to the amount 
perhaps, of feveral millions, a year or two before 
it comes in, requires a greater capital than car* 
eafily be collected into any private copartnery. 

THE trade of infurance gives great fecurity to 
the fortunes of private people, and by dividing 
among a great many that lofs which would ruin 
an individual, makes it fall light and eafy upon 
the whole fociety. In order to give this fecurity, 
however, it is neceflary that the infurers mould 
have a very large capital. Before the eftablifh- 
ment of the two joint Hock companies for infur- 
ance in London, a lift, it is faid, was laid before 
the attorney-general, of one hundred and fifty 
private infurers who had failed in the courfe of a 
few years. 

THAT 



THE WEALTH OF NATIONS. 149 

THAT navigable cuts and canals, and the works CHAP. 

are fometimes neceffary for fupplying a great 
city with water, are of great and general utility, 
while at the fame time they frequently require a 
greater expence than fuits the fortunes of private 
people, is fufficiently obvious. 

EXCEPT the four trades above mentioned, I have 
not been able to recoiled any other in which all the 
three circumftances, requifite for rendering reafon- 
able the eflablifhment of a joint flock company, 
concur. The Englifh copper company of London, 
the lead fmelting company, the glafs grinding 
company, have not even the pretext of any great 
or fingular utility in the object which they purfue ; 
nor does the purfuic of that object feem to require 
any expence urifuitable to the fortunes of many 
private men. Whether the trade which thofe com- 
panies carry on, is reducible to fuch flrict rule and 
method, as to render it fit for the management of 
a joint flock company, or whether they have any 
reafon to boaft of their extraordinary -profits, I do 
not pretend to know. The mine-adventurers 
company has been long ago bankrupt. A fhare in 
the flock of the Britifh Linen Company of Edin- 
burgh fells, at prefent, very much below par, 
though lefs fo than it did fome years ago. The 
joint flock companies, which are eftablifhed for 
the public-fpirited purpofe of promoting fome 
particular manufacture, over and above managing 
their own affairs ill, to the diminution of the 
general flock of the fociety, can in other refpects 
fcarce ever fail to do more harm than good. 
J^otwithflanding the mod upright intentions, the 
;L 3 . 



I5 o THE NATURE AND CAUSES OF 

BOOK unavoidable partiality of their directors to partU 
cular branches of the manufacture, of which the 
undertakers miflead an4 impctfe upon them, is a. 
real difcouragement to the reft, ^ncl neceflarily 
breaks, more or lefs, that natural proportion 
which would otherwife eftablifli itfejf between 
judicious induftry and profit, and which,, to the 
general induftry of the country, is of all encou* 
ragements the greateft and the moft effectual. 

ARTICLE II. 

Of the Expence of the Inftitutions for the Education 
ofTouth. 

THE inftitutions for the education of the youth 
may, in the fame manner, furnifh a revenue fufr 
fkient for defraying their own expence. The fee 
or honorary which the fcholar pays to the mafter 
naturally constitutes a revenue of this kind, 

EVEN where the reward of the mafter does not 
arife altogether from this natural revenue, it ftill is, 
not neceffary that it fhould be derived from that ge- 
neral revenue of the fociety, of which the collection 
and application are, irj moft countries, afligned tq 
the executive power. Through the greater part of 
Europe, accordingly, theendowment of fchoojs and 
colleges makes either no charge upon that general 
revenue, or b'ut a very fmall one. It every where 
?.rifes chiefly from fome local or provincial revenue, 
from the rent of fome landed eftate, or from the 
intereft of fome. fum of money allotted and put 
under the management of truftees for this parti- 
cular purpofe, fometimes by the fovereign himfelf, 
and fometimes by fome private donor. 

HAV* 



THE WEALTH OF NATIONS. 151 

HAVE thofe public endowments contributed in C H A p- 
general to promote the end of their inftitution ? 
Have they contributed to encourage the dili- 
gence, and to improve the abilities of the 
teachers ? Have they directed the courfe of edu- 
cation towards objects more ufeful, both to the 
individual and to the public, than thofe to which 
it would naturally have gone of its own accord ? 
It fhould not feem very difficult to give at leaft a 
probable anfwer to each of thofe queftions. 

IN every profeflion, the exertion of the greater 
part of thofe who exercife it, is always in pro- 
portion to the necellity they are under of making 
that exertion. This neceflity is greateft with 
thofe to whom the emoluments of their profef- 
fion are the only fource from which they expect 
their fortune, or even their ordinary revenue and 
fubfiftence. In order to acquire this fortune, or 
even to -get this fubfiftence, they muft, in the 
courfe of a year, execute a certain quantity of 
work of a known value ; and, where the compe- 
tition is free, the rivalfhip of competitors, who 
are all endeavouring to juftle one another out of 
employment, obliges every man to endeavour to 
execute his work with a certain degree of exact- 
nefs. The greatnefs of the objects which are to 
be acquired by fuccefs in fome particular profef- 
fions may, no doubt, fometimes animate the ex* 
ertion of a few men of extraordinary fpirit and 
ambition. Great objects, however, are evidently 
not neceffary in order to occafion the greateft ex- 
ertions. Rivalfhip and emulation render excel- 
lency, even in mean profefffems, an object of am- 

L 4 bition, 



THE NATURE AND CAUSES OF 
BOOK bition, and frequently occafion the very greateft 
exertions. Great obje&s, on the contrary, alone 
and unfupported by the neceflity of application, 
have feldom been fufficient to occafion any con- 
fiderable exertion. In England, fuccefs in the 
profdlior of the law leads to fome very great 
objects of ambition ; and yet how few men, born 
to eafy fortunes, have ever in this country been 
eminent in that profeilion ? 

THE endowments of fchools and colleges have 
necefTarily diminiihed more or Ids the neceflity 
of application in the teachers. Their fubfiftence, 
fo far as it arifes from their falaries, is evidently 
derived from a fund altogether independent of 
their fuccefs and reputation in their particular 
profeffions. 

IN fome univerfities the falary makes but a 
part, and frequently but a fmall part of the emo- 
luments of the teacher, of which the greater part 
arifes from the honoraries or fees of his pupils. 
The neceflity of application, though always more 
or lefs diminimed, is not in .this cafe entirely 
< 'ken away. Reputation in his profeflion is ftill 
me importance to him, and he ftill has fome 
dep ./ upon the affection, gratitude, and 

favourable report of thofe who have attended 
.xis infL actions ; and thefe , favourable fen- 
:iits he is likely to gain in no way fo well as 
deferving them, that is, by the abilities and 
diligence with which he difcharges every part of 
bis duty. 

IN other univerfities the teacher is prohibited 
from receiving anj honorary or fee from his pu- 
pils, 



THE WEALTH OF NATIONS. 15$ 

pHs, and his falary conftitutes the whole of the C H A p 
revenue which he derives from his office. His 
intereft is, in this cafe, fet as directly in oppofi- 
tion to his duty as it is poflible to fet it. It is 
the intereft of every man to live as much at his 
cafe as he can ; and if his emoluments are to be 
precifely the fame, whether he does, or does not 
perform fome very laborious duty, it is certainly 
his intereft, at leaft as intereft is vulgarly under- 
flood, either to neglect it altogether, or, if he is 
fubject to fome authority which will not fuifer him 
to do this, to perform it in as carelefs and flovenly 
a manner as that authority will permit. If he is 
naturally active, and a lover of labour, it is his 
intereft to employ that activity in any way, from 
which he can derive fome advantage, rather than 
in the performance of his duty, from which he can 
derive none. 

IF the authority to which he is fubject refides in 
the body corporate, the college, or univerfity, of 
which he himfelf is a member, and in which the 
greater part of the other members are, like himfeif, 
perfons who either are, or ought to be teachers ; 
they are likely to make a common caufe, to be all 
very indulgent to one another, and every man to 
content that his neighbour may neglect his duty, 
provided he himfelf is allowed to neglect his own. 
In the univerfity of Oxford, the greater part of the 
public profeffors have, for thefe many years, given 
up altogether even the pretence of teaching. 

IF the authority to which he is fubject refides, 
not fo much in the body corporate of which he/ 

is 




THE NATURE AND CAUSES OF 
is a member, as in foine other extraneous perfons, 
in the bifhop of the diocele for example ; in the 
governor of the province ; or, perhaps, in fornc 
minifter of ftate ; it is not indeed in this cafe very 
likely that he will be fuiFered to neglect his duty 
altogether. All that fuch fuperiors, however, can 
force him to do, is to attend upon his pupils a 
certain number of hours, that is, to give a certain, 
number of lectures in the week, or in the year. 
What thofe le&ures fhall be, muft ftill depend 
upon the diligence of the teacher , and that dili- 
gence is likely to be proportioned to the motives 
which he has for exerting it. An extraneous jurif- 
di&ion of this kind, befides, is liable to be exer- 
cifed both ignorantly and capricioufly. In its 
nature it is arbitrary and difcretionary, and the 
perfons who exercife it, neither attending upon the 
lectures of the teacher themfelves, nor perhaps 
underftanding the fciences which it is his bufmefs 
to teach, are feldom capable of exercifmg it with 
judgment. From the infolence of office too they 
are frequently indifferent how they exercife it, and 
are very apt to cenfure or deprive him of his office 
wantonly, and without any juft caufe. The per* 
fon fubject to fuch jurifdi&ion is neceflarily de- 
graded by it, and, inflead of being one of the 
moft refpectable, is rendered one of the meaneft 
and moft contemptible perfons in the fociety. It 
Is by powerful protection only that he can ef- 
fectually guard himfelf againfl the bad ufage to 
which he is at all times expofed ; and this pro- 
te&ion he is moft likejy to gain, not by ability 

or 



THE WEALTH OF NATIONS. 155 

or diligence in his profefiion, but by obfequiouf- c H ? A p - 
nefs to the will of his fuperiors, and by being 
ready, at all times, to facrifice to that will the 
rights, the intereft, and the honour of the body 
corporate of which he is a member. Whoever 
has attended for any confiderable time to the admi- 
piftration of a French univerfity, muft have had 
occafion to remark the effects which naturally re- 
fult from an arbitrary and extraneous jurifdiction of 
ithis kind. 

WHATEVER forces a certain number of ftudents 
to any college or univerfity, independent of the 
merit or reputation of the teachers, tends more 
or lefs to diminifh the neceflity of that merit or 
reputation. 

THE privileges of graduates in arts, in law, 
phyfic, and divinity, when they can be obtained 
only by refiding a certain number of years in cer- 
tain univerfities, neceffarily force a certain num- 
ber of ftudents to fuch univerfities, independent 
of the merit or reputation of the teachers. The 
privileges of graduates are a fort of ftatutes of 
apprenticefhip, which have contributed to -the 
improvement of education, juft as the other fta- 
tutes of apprenticefhip have to that of arts and 
manufactures. 

THE charitable foundations of fcholarfhips, 
exhibitions, burfaries, &c. neceflarily attach a 
certain number of ftudents to certain colleges, 
independent altogether of the merit of thofe 
particular colleges. Were the ftudents upon 
fuch charitable foundations left free to chufe 

what 



156 THE NATURE AND CAUSES OF 

BOOK what college they liked heft, fuch liberty might per* 
haps contribute to excite ibme emulation among 
different colleges, A regulation, on the contrary, 
which prohibited even the independent members of 
every particular college from leaving it, and going 
to any other, without leave firft afked and obtained 
of that which they meant to abandon, would tend 
very much to extinguifh that emulation. 

IF in each college the tutor or teacher, who was 
to inftrucl each ftudent in all arts and fciences, 
fhould f not be voluntarily chofen by the ftudent, 
bu^ appointed by the head of the college ; and if, 
in cafe of neglect, inability, or bad ufage, the 
ftudent mould not be allowed to change him for 
another, without leave firft afked and obtained ; 
iuch a regulation would not only tend very much 
to extinguifh all emulation among the different 
tutors of the fame college, but to diminifh very 
much in all of them the neceffity of diligence and 
of attention to their refpedive pupils. Such teach- 
ers, though very well paid by their ftudents, might 
be as much difpofed to neglect them, as thole who 
are net paid by them at all, or who have no other 
recompence but their falary. 

IF the teacher happens to be a man of fenfe, it 
muft be an unpleafant thing to him to be con- 
fcious, while he is lecturing his ftudents, that he 
is either fpeaking or reading nonfenfe, or what 
is very little better than nonfenfe. It muft too 
be unpleafant to him to obferve that the greater 
part of his ftudents defert his lectures ; or per- 
haps attend upon them with plain enough marks 
9 of 



THE WEALTH OF NATIONS. 157 

of neglect, contempt, and derifion. If he is c H A p. 
obliged, therefore, to give a certain number of 
lectures, thefe motives alone, without any other 
intereft, might difpofe him to take fome pains to 
give tolerably good ones. Several different ex- 
pedients, however, may be fallen upon, which 
will effectually blunt the edge of all thofe incite- 
ments to diligence. The teacher, inftead of ex- 
plaining to his pupils himfelf the fcience in 
which he propofes to inftruct them, may read 
fome book upon it ; and if this book is written 
in a foreign and dead language, by interpreting 
it to them into their own ; or, what would give 
him ftill left trouble, by making them interpret 
it to him, and by now and then making an oc- 
cafional remark upon it, he may flatter himfelf 
that he is giving a lecture. The flighfeft degree 
of knowledge and application will enable him to 
do this, without expofing himfelf to contempt or 
derifion, of faying any thing that is really foolifh, 
abfurd, or ridiculous. The difcipline of the col- 
lege, at the fame time, may enable him to force all 
his pupils to the mod regular attendance upon this 
fham lecture, and to maintain the moft decent and 
refpectful behaviour during the whole time of the 
performance. 

THE difcipline of colleges and univerfities is 
in general contrived, not for the benefit of the 
fludents, but for the inlereft, or, more properly 
fpeaking, for the eafe of the matters. Its object 
is, in all cafes, to maintain the authority of the 
matter, and whether he neglects or performs his 
duty, to oblige the fludents in ail cafes to be- 
have 




THE NATURE AND CAUSES OF 

have to him as if he performed it with the greateft 
diligence and ability. It feems to prefume per- 
feel wifdom and virtue in the one order, and the 
greateft weaknefs and folly in the other. Where 
the matters, however, really perform their duty, 
there are no examples, I believe, that the greater 
part of the fludents ever negleft theirs. No 
difcipline is ever requifite to force attendance 
upon leclures which are really worth the attend- 
ing, as is well known wherever any fuch lee* 
tures are given. Force and reftraint may, no 
doubt, be in fome degree requifite in order to 
oblige children, or very young boys r to attend 
to thofe parts of education which if is thought 
neceflary for them to acquire during that early 
period of life ; but after twelve or thirteen years 
of age, provided the mailer does his duty, force 
or reftraint can fcarce ever be neceflary to carry 
on any part of education. Such is the generofity 
of the greater part of young men, that fo far from 
being difpofed to neglecl: or defpife the inftructions 
of their mafter, provided he fhews fome ferious in- 
tention of being of ufe to them, they are generally 
inclined to pardon a great deal of incorreclnefs in 
the performance of his duty, and fometimes even 
to conceal from the public a good deal of grofs 
negligence. 

THOSE parts of education, it is to be obferved, 
for the teaching of which there are no public in- 
flitutions, are generally the bcft taught. When 
a young man goes to a fencing or a dancing fchool, 
he does not indeed always learn to fence or to dance 
very well > but he feldom fails of learning to fence 

or 



THE WEALTH OF NATIONS. 

cr to dance. The good effe&s of the riding 
fchool are not commonly fo evident. The ex- 
pence of a riding fchool is fo great, that in moft 
places it is a public inftitution. The three moll 
eflential parts of literary education, to read, write, 
and account, it (till continues to be more common 
to acquire in private than in public fchools ; and 
it very feldom happens that any body fails of ac- 
quiring them to the degree in which it is neceflary 
to acquire them. 

IN England the public fchools are much lefs 
corrupted than the univerfities. In the fchools the 
youth are taught, or at lead may be taught, Greek 
and Latin ; that is, every thing which the mailers 
pretend to teach, or which, it is expe&ed, they 
mould teach. In the univerfities the youth neither 
are taught, nor always can find any proper means 
of being taught the fciences, which it is the bun*- 
nefs of thofe incorporated bodies to teach. The 
reward of the fchoolmafler in moft cafes depends 
principally, in fome cafes almoft entirely, upon the 
fees or honoraries of his fcholars. Schools have no 
exclufive privileges. In order to obtain the ho- 
nours of graduation, it is not neceflary that a per- 
fon ihould bring a certificate of his having fludied 
a certain number of years at a public fchool. If 
upon examination he appears to underftand what is 
taught there, no queftlons are afked about the place 
where he learnt it. 

THE parts of education which are commonly 
taught in univerfities, it may, perhaps, be faid 
are not very well taught. But had it not been 
for thofe inftitutions they would not have been 

commonly 




t6a T&E NATURE AND CAUSES OF 

BOOK commonly taught at all, and both the individual 
and the public would have fuffered a good deal 
from the want of thofe important parts of edu- 
cation. 

THE prefent univerfities of Europe were ori- 
ginally, the greater part of them, ecclefiaftical 
corporations ; inflituted for the education of 
churchmen. They were founded by the autho- 
rity of the pope, and were fo entirely under his 
immediate protection, that their members, whether 
maftersor ftudents, had ail of them what was then 
called the benefit of clergy, that is, were exempted 
from the civil jurifdi6Hon of the countries in which 
their reipe6tive univerfities were fituated, and were 
amenable only to the ecclefiaftical tribunals. What 
was taught in the greater part of thofe univerfities 
was fuitable to the end of their inftitution, either 
theology, or fomething that was merely prepara- 
tory to theology. 

WHEN chnflianity was firft eftablifhed by law, 
a corrupted Latin had become the common lan- 
guage of all the weftera parts of Europe. The 
fervice of the church accordingly, and the tranfla- 
tion of the Bible which was read in churches, 
were both in that corrupted Latin ; that is, in the 
common language of the country. After the ir- 
ruption of the barbarous nations who overturned 
the Roman empire, Latin gradually ceafed to be 
the language of any part of Europe. But the re- 
verence of the people naturally preferves the efta- 
blifhed forms and ceremonies of religion, long 
after the circumftances which firft introduced and 
rendered them reafonable arc no more. Though 

Latin, 



THE WEALTH OF NATIONS. 161 

Latin, therefore, was no longer underftood any CHAP, 
where by the great body of the people, the whole 
fervice of the church Rill continued to be per- 
formed in that language. Two different Ian- 
guagcs were thus eftablifhed in Europe, in the 
fame manner as in ancient Egypt ; a language of 
the priefts, and a language of the people ; a 
facred and a prophane ; a learned and an unlearned 
language. But it was necefiary that the priefts 
fhould underftand fomething of that facred and 
learned language in which they were to officiate ; 
and the (ludy of the Latin language therefore made* 
from the beginning, an eflential part of univerfity 
education* 

IT was not fo with that either of the Greek, or 
of the Hebrew language. The infallible decrees 
of the church had pronounced the Latin tranflation 
of the Bible, commonly called the Latin Vul- 
gate, to have been equally dictated by divine in- 
fpiration, and therefore of equal authority with 
the Greek and Hebrew originals. The know- 
ledge of thofe two languages, therefore, not 
being indifpenfably requifite to a churchman, 
the fludy of them did not for a long time make a 
neceflary part of the common courfe of nniverfity 
education* There are fome Spanifh univerfities, 
I am affured, in which the fludy of the Greek 
language has never yet made any part cf that 
courfe. The firfl reformers found the Greek text 
of the New Teftament, and even the Hebrew text 
of the Old, more favourable to their opinions, 
than the vulgate tranflation, which, as might 
naturally be fuppofed, had been gradually ao 

VOL. in. M com- 



;6* THE NATURE AND CAUSES OF 

BOOK eommodated to fupport the doctrines of the ca- 
tholic church. They fet themfelves, therefore, 
to expofe the many errors of that tranflatio-n, 
xvhich the Roman catholic clergy were thus put 
under the necefilty of defending or explaining. 
But this could not well be done without fome 
knowledge of the original languages, of which 
the ftudy was therefore gradually introduced into 
the greater part of univerfities ; both of thofe 
which embraced, and of thofe which rejected, the 
doctrines of the reformation. The Greek lan- 
guage was connected with every part of that 
claflical learning, which, though at firft princi- 
pally cultivated by catholics and Italians, hap- 
pened to come into fafhion much about the fame 
time that the doctrines of the reformation were 
fet on foot.. In the greater part of univerfities, 
therefore/ that language was taught previous to 
the fludy of philofophy, and as foon as the 
ftudent had made fome progrefs in the Latin. The 
Hebrew language having no connection with 
claflical learning, and, except the holy fcriptures, 
being the language of not a fmgle book in any 
efteem, the fludy of it did not commonly com- 
mence till after that of : philofophy, and when 
the ftudent had entered upon the fludy of theo- 
logy- 

ORIGINALLY the firft rudiments both of the 
Greek and Latin languages were taught in univer- 
fities, and in fome univerfities they flill continue 
to be fo. In others it is expected that the ftudent 
mould have previoufly acquired at leaft the rudi- 
ments of one or both of thofe languages, of which, 

the 



THE WEALTH OF NATIONS. 163 

the ftudy continues to make every where a very CHAP, 
confiderable part of univerfity education. 

THE ancient Greek philofophy was divided into 
three great branches ; phyfics, or natural philo- 
fophy ; ethics, or moral philofophy ; and logic. 
This general divifion feems perfectly agreeable to 
the nature of things. 

THE great phenomena of nature, the revolu- 
tions of the heavenly bodies, eclipfes, comets; 
thunder, lightning, and other extraordinary 
me'teors ; the generation, the life, growth, and 
diflolution of plants and animals ; are objects 
which, as they neceffarily excite the wonder, fo 
they naturally call forth the curiofity, of mankind 
to enquire into their caufes. Superftition firft 
attempted to fatisfy this curiofity, by referring all 
thofe wonderful appearances to the immediate 
agency of the gods. Philofophy afterwards en- 
deavoured to account for them, from more fa- 
miliar caufes, or from fuch as mankind were 
better acquainted with, than the agency of the 
gods. As thofe great phenomena are the firft 
objects of human curiofity, fo the fcience which 
pretends to explain them muft naturally have been 
the firft branch of philofophy that was cultivated. 
The fir ft philofophers, accordingly, of whom hif- 
tory has preferved any account, appear to have 
been natural philofophers. 

IN every age and country of the world men 
muft have attended to the characters, defigns, 
and actions of one another, and many reputable 
rules and maxams for the conduct of human life 

M 2 muft 



164 TIIE NATURE AND CAUSES OF 

BOOK mud have been laid down and approved of by 
common confent. As foon as writing came into 
fafhion, wife men, or thofe who fancied them- 
'felves fuch, would naturally endeavour to increafe 
the number of thofe eftablimed and refpected 
maxims, and to exprefs their own fenfe of what was 
either proper or improper conduct, fometimes in 
the more artificial form of apologues, like what arc 
called the fables of -ZEfop; and fometimes in the more 
firnple one of apophthegms, or wife fayings, like 
the Proverbs of Solomon, the verfes of Theognis 
and Phocyliides, and fome part of the works of 
Hefiod. They might continue in this manner for 
a long time merely to multiply the number of thofe 
maxims of prudence and morality, without even 
attempting to arrange them in any very diftinct or 
methodical order, much lefs to connect them to- 
gether by one or more general principles, from 
which they were all deducible, like effects from their 
natural caufes, The beauty of a fyftematical ar- 
rangement of different obfervations connected by a 
few common principles, was firfl feen in the rude 
effays of thofe ancient times towards a fyftem of 
natural philofophy. Something of the fame kind 
w-as afterwards attempted in morals. The maxims 
of common life were arranged in fome methodical 
order, and connected together by a few common 
principles, in the fame manner as they had at- 
tempted to arrange and connect the phenomena of 
nature. The fcience which pretends to inveftigate 
and explain thofe connecting principles, is what is 
properly called moral philofophy. 

DIFFERENT 



THE WEALTH OF NATIONS. 165 

DIFFERENT authors gave different fyftems both CH 4 P. 
of natural and moral philofophy. But the argu- 
ments by which they fupported thofe different 
fyftems, far from being always demonftrations, 
were frequently at beft but very flender probabi- 
lities, and foinetimes mere fophifms, which had 
no other foundation but the inaccuracy and am- 
biguity of common language. Speculative fyf- 
tems have in all ages of the world been adopted 
for reafons too frivolous to have determined the 
judgment of any man of common fenfe, in a 
matter of the fmallefl pecuniary intereft. Grofs 
fophiflry has fcarce ever had any influence upon 
the opinions of mankind, except in matters 'of 
philofophy and fpeculation ; and in thefe It has 
frequently had the greatefl. The patrons of each 
fyftem of natural and moral philofophy naturally 
endeavoured to expofe the weaknefs of the argu- 
ments adduced to fupport the fyftems which were 
oppofite to their own. In examining thofe argu- 
ments, they were rieceffarily led 'to confider the 
difference between a probable and a demonftra- 
live argument, between a fallacious and a con- 
clufive one ; and Logic, or the fcience of the 
general principles of good and bad reafoning, 
neceflarily arofe out of the obfervations which a 
fcrutiny of this kind gave occafion to. Though 
in its origin, pofterior both to phyfics and to 
ethics, it was commonly taught, not indeed ir* 
all, but in the greater part of the ancient fchools 
of philofophy, previoufly to either of thofe 
fciences. The fludent, it feems to have been. 
thought, ought to underftand well the difference 
M 3 between 



166 THE NATURE AND CAUSES OF 

BOOK between good and bad reafoning, before he was 
led to reafon upon fubjects of fo great import- 
ance. 

THIS ancient divifion of philofophy into three 
parts was, in the greater part of the univerfities of 
Europe, changed for another into five. 

IN the ancient philofophy, whatever was taught 
concerning the nature either of the human mind 
or of the Deity, made a par^ of the fyftem of 
phyfics. Thofe beings, in whatever their effence 
might be fuppofed to confift, were parts of the 
great fyftem of the univerfe, and parts too pro- 
ductive of the moft important effects. Whatever 
human reafon could either conclude, or con- 
jecture, concerning them, made, as it were, two 
chapters, though no doubt two very important 
ones, of the fcience which pretended to give an 
account of the origin and revolutions of the great 
fyftem of the univerfe. But in the univerfities 
of Europe, where philofophy was taught only as 
fubfervient to theology, it was natural to dwell 
longer upon thefe two chapters than upon any 
other of the fcience. They were gradually more 
and more extended, and were divided into many 
inferior .chapters, till at laft the doctrine of fpirits, 
of which fo little can be known, came to take 
up as much room in the fyftem of philofophy as 
the doctrine of bodies, of which fo much can be 
known. The doctrines concerning thofe two 
fubjects were confidered as making two diftindt 
fciences. What are called Metaphyfics or Pneu- 
matics were fet in oppofition to Phyfics, and 
were cultivated not only as the more fublime, 

but, 



THE WEALTH OF NATIONS. 167 

but, for the purpofes of a particular profefTion, CHAP. 
as the more ufeful fcience of the two. The proper 
fubjed: of experiment and obfervation, a fubject 
in which a careful attention is capable of making 
fo many ufeful difcoveries, was almoft entirely 
neglected. The fubjec~t in which, after a few very 
fimple and almofl obvious truths, the moil careful 
attention can difcover nothing but obfcurity and 
uncertainty, and can confequently produce no- 
thing but fubtleties and fophifms, was greatly 
cultivated. 

WHEN thofe two fciences had thus been fet i 
oppofition to one another, the comparifon be- 
tween them naturally give birth to a third, to 
what was called Ontology, or the fcience which 
treated of the qualities and attributes which were 
common to both the fubjecls of the other two 
fciences. But if fubdeties and fophifms compofed 
the greater part of the Metaphyfics or Pneumatics 
of the fchools, they compofed the whole of this 
cobweb fcience of Ontology, which was likewife 
fometimes called Metaphyfics. 

WHEREIN confided the happinefs and perfec- 
tion of a man, confidered not only as an indi- 
vidual, but as the member of a family, of a ftate, 
and of the great fociety of mankind, was the ob- 
jeft which the ancient moral philofophy propofed 
to inveftigate. In that philofophy the duties of 
human life were treated of as fubfervient to the 
happinefs and perfection of human life. But 
when moral, as well as natural philofophy, came 
to be taught only as fubfervient to theology, the 
duties of human life were treated of as chiefly 
M 4 fubfer* 



168 THE NATURE AND CAUSES OF 

BOOK fubfervient to the happinefs of a life to come. In 
the ancient philofophy the perfection of virtue was 
reprefented as necerlarily productive, to the perfon 
who pofTeffed it, of the moil perfect happinefs in 
this life. In the modern philofophy it was fre- 
quently reprefented as generally, or rather as al- 
inoft always inconfiftent with any degree of happi- 
nefs in this life ; and heaven was to be earned only 
by penance and mortification, by the aufterities 
and abafement of a monk; not by the liberal, ge- 
nerous, and fpirited conduct of a man, Cafuiftry 
and an afcetic morality made up, in mod cafes, the 
greater part of the moral philofophy of the fchools. 
By far the mod important of all the different 
branches of philofophy, became in this manner by 
far the mod corrupted. 

SUGH, therefore, was the common courfe of 
philofophical education in the greater part of the 
univerfities in Europe. Logic was taught firfl: 
Ontology came in the fecond place : Pneumato- 
logy, comprehending the doctrine concerning the 
nature of the human foul and of the Deity, in the 
third : In the fourth followed a debafed fyflem of 
moral philofophy, which was confidered as imme- 
diately connected with the doctrines of Pneumato- 
logy,' with the immortality of the human foul, and 
with the rewards and punimments which, from the 
juftice of the Deity, were to be expected in a life 
to come : A fhort and fuperficial fyftem of phyfics 
ufually concluded the courfe. 

THE alterations which the univerfities of Eu- 
rope thus introduced into the ancient courfe of 
philofophy, were all meant for the education of 

ecclefiaftics. 



THE WEALTH OF NATIONS. 

ecclefiaftics, and to render it a more proper in- 
troduction to the ftudy of theology. But the 
additional quantity of fubtlety and fophiftry ; 
the cafuiftry and the afcetic morality which thofe 
alterations introduced into it, certainly did not 
render it more proper for the education of gentle- 
men or men of the world, or more likely either 
to improve the underftanding, or to mend the 
heart. 

THIS courfe of philofophy is what ftill con- 
tinues to be taught in the greater part of the uni- 
verfities of Europe, with more or lefs diligence, 
according as the conftitution of each particular 
univerfity happens to render diligence more or 
lefs neceflary to the teachers. In fome of the 
richeft and beft endowed univerfities, the tutors 
content themfelves with teaching a few uncon- 
nected mreds and parcels of this corrupted courfe ; 
and even thefe they commonly teach very negli- 
gently and fuperficially. 

THE improvements which, in modern times, 
have been made in feverai different branches of 
philofophy, have not, the greater part of them, 
been made in univerfities ; though fome no doubt 
have. The greater part of univerfities have not 
even been very forward to adopt thofe improve- 
ments, after they were made ; and feverai of 
thofe learned focieties have chofen to remain, for 
a long time, the fanctuaries in which exploded 
fyftems and obfolete prejudices found fhelter and 
protection, after they had been hunted out of 
every other corner of the world. In general, 
the richeft and beft endowed univerfities have 

been 




i 7 o THE NATURE AND CAUSES OF 

BOOK been the flowed in adopting thofe improvements, 
and the mofl averfe to permit any confiderable 
change in the eftablifhed plan of education. Thofe 
improvements were more eafily introduced into 
fome of the poorer univerfities., in which the 
teachers, depending upon their reputation for the 
greater part of their fubfiftence, were obliged to 
pay more attention to the current opinions of the 
world. 

BUT though the public fchools and univerfities 
of Europe were originally intended only for the 
education of a particular profeflion, that of 
churchmen ; and though they were not always 
very diligent in inftru&ing their pupils even in 
the fciences which were fuppofed neceflary for 
that profeilion ; yet they gradually drew to them- 
felves the education of almoft all other people, 
particularly of almoft all gentlemen and men of 
fortune. No better method, it feems, could be 
fallen upon of fpending, with any advantage, 
the long interval between infancy and that period 
of life at which men begin to apply in good 
earned to the real bufmefs of the world, the 
bufmefs which is to employ them during the re- 
mainder of their days. The greater part of what 
is taught in fchools and univerfities, however, does 
not feem to be the moft proper preparation for that 
bufmefs. 

IN England, it becomes every day more and 
more the cuftom to fend young people to travel 
in foreign countries immediately upon their leaving 
fchool, and without fending them to any uni- 
verfity. Our young people, it is faid, generally 

return 



THE WEALTH OF NATIONS. 171 

return home much improved by their travels. A CHAP. 
young man who goes abroad at feventeen or eigh- 
teen, and returns home at one and twenty, re- 
turns three or four years older than he was when 
he went abroad ; and at that age it is very dif- 
ficult not to improve a good deal in three or 
four years. In the courfe of his travels, he ge- 
nerally acquires fome knowledge of one or two 
foreign languages ; a knowledge, however, which 
is feldom fufficient to enable him either to fpeak 
or write them with propriety. In other refpects, 
he commonly returns home more conceited, more 
unprincipled, more diffipated, and more inca- 
pable of any ferious application either to ftudy or 
to bufmefs, than he could well have become in 
fo fliort a time, had he lived at home. By travel- 
ling fo very young, by fpending in the moft fri- 
volous diflipation the moft precious years of his 
life, at a diflance from the infpe&ion and con- 
troul of his parents and relations, every ufeful 
habit, which the earlier parts of his education 
might have had fome tendency to form in him, 
inflead of being ri vetted and confirmed, is almofl 
neceflarily either weakened or effaced. Nothing 
but the difcredit into which the univerfities are 
allowing themfelves to fall, could ever have 
brought into repute fo very abfurd a practice as 
that of travelling at this early period of life. By 
fending his fon abroad, a father delivers himfelf, 
at lead for fome time, from fo difagreeable an 
objecl as that of a fon unemployed, neglected, and 
going to ruin before his eyes. 

Sucn 




THE NATURE AND CAUSES OF 

SUCH have been the effects of fome of the mo- 
dern inftitutions for education. 

DIFFERENT plans and different inftitutions for 
education feem to have taken place in other ages 
and nations. 

IN the republics of ancient Greece, every free 
citizen was initrucled, under the direction of the 
public magiftrate, in gynlnaftic exercifes and in 
mufic. By gymnaftic exercifes, it was intended 
to harden his body, to fharpen his courage, and 
to prepare him for the fatigues and dangers of 
war ; and as the Greek militia was, by all ac- 
counts, one of the beft that ever was in the world, 
this part of their public education mud have an^ 
fwered completely the purpofe for which it was in- 
tended. By the other part, mufic, it was propofed, 
at leaft by the philofophers and hiflorians who have 
given us an account of thofe inflitutions, to hu- 
manize the mind, to foften the temper, and to 
difpofe it for performing all the focial and moral 
duties of public and private life. 

IN ancient Rome, the exercifes of the Campus 
Martius anfwered the fame purpofe as thofe of the 
Gymnazium in ancient Greece, and they feem to 
have anfwered it equally well. But among the 
Romans there was nothing which correfponded to 
the mufical education of the Greeks. The 
morals of the Romans, however, both in private 
and public life, feem to have been, not only 
equal, but, upon the whole, a good deal fuperior 
to thofe of the Greeks. That they were fuperior 
in private life, we have the exprefs teftimony of 
Polybius and of Dionyfius of lialicarnaflus, two 

authors 



THE WEALTH OF NATIONS. 173 

authors well acquainted with both nations ; and c H A p. 
the whole tenor of the Greek and Roman hiftory 
bears witnefs to the fuperiority of the public 
morals of the Romans. The good temper and 
moderation of contending factions feems to be 
the mod eflential circumftance in the public 
morals of a free people. But the factions of the 
Greeks were almoft always violent and fangui- 
nary; whereas till the time of the Gracchi, no 

blood had ever been fhed in any Roman faction ; 
and from the time of, the Gracchi, the Roman re- 
public may be confidered as in reality difTolved. 
Notwithftanding, therefore, the very refpecbablc 
authority of Plato, Ariftotle, and Polybius, and 
notwithftanding the very ingenious reafons by 
which Mr. Montefquieu endeavours to fupport 
that authority, it feems probable that the muficai 
education of the Greeks had no great effect in. 
mending their morals, fmce> without any fuch 
education, thofe of the Romans were upon the 
whole fuperior. The refpect of thofe ancient 
fages for the inftitutions of their anceitors, had 
probably difpofed them to find much political 

. wifdom in what was, perhaps, merely an ancient 
cuftom, continued, without interruption, from 
the earlieft period of thofe focieties, to the times 
in which they had arrived at a conficlerable de- 
gree of refinement. Mufic and dancing are the 
great amufements of almoft all barbarous na- 
tions, and the great accomplishments which are 
fuppofed to fit any man for entertaining his 
focicty. It is fo at this day among the negroes 
on the eoafl of Africa. It was fo among the 

ancient 



174 THE NATURE AND CAUSES OF 

BOOK ancient Celtes, among the ancient Scandinavians, 
and, as we may learn from Homer, among the 
ancient Greeks in the times preceding the Trojan 
war. When the Greek tribes had formed them- 
felves into little republics, it was natural that the 
ftudy of thofe accomplifhments Ihould, for a long 
time, make a part of the public and common edu- 
cation of the people. 

THE mafters who inftru&ed the young people 
either in mufic or in military exercifes, do not 
feem to have been paid, or even appointed by the 
ftate, either in Rome or even in Athens, the 
Greek republic of whofe laws and cuftoms we 
are the bed informed. The 'ftate required that 
every free citizen Ihould fit himfelf for defending 
it in war, and fhould, upon that account, learn his 
military exercifes. But it left him to learn them 
of fuch mafters as he could find, and it feems to 
have advanced nothing for this purpofe, but a 
public field or place of ^exercife, in which he fhould 
pra&ife and perform them. , 

IN the early ages both of ithe Greek and Ro- 
man republics, the other parts of education 
feerrr to have confided in learning to read, write, 
and account according to the arithmetic of the 
times. Thefe accomplifhments the -richer citizens 
feem frequently to have acquired at home, by 
the affiftance of fome domeftic pedagogue, who 
was, generally, either a Have or a freedman; 
and the poorer citizens, in the fchools of fuch 
mafters as made a trade of teaching for hire* 
Such parts of education, however, were aban- 
doned altogether to the care of the parents or 

guardians 



THE WEALTH OF NATIONS, 
guardians of each individual. It does not appear 
that the ftate ever affumed any infpe&ion or di- 
redion of them. By a law of Solon, indeed, 
the children were acquitted from- maintaining 
thofe parents in their old age, who had neg- 
lected to inftruft them in fome profitable trade or 
buimefs. 

IN the progrefs of refinement, when philofophy 
and rhetoric came into fafhion, the better fort of 
people ufed to fend their children to the fchools 
of philofophers and rhetoricians, in order to be 
inftruded in thefe fafhionable fciences. But 
thofe fchools were not fupported by the public. 
They were for a long time barely tolerated by it. 
The demand for philofophy and rhetoric was 
for a long time fo fmall, that the firfl profefled 
teachers of either could not find conftant employ- 
ment in any one city, but were obliged to travel 
about from place to place. In this manner lived 
Zeno of Elea, Protagoras, Gorgias, Hippias, 
and many others. As the demand increafed, the 
fchools both of philofophy and rhetoric became 
flationary ; firfl: in Athens, and afterwards in 
feveral other cities. The ftate, however, feems 
never to have encouraged them further than by 
afligning to fome of them a particular place to 
teach in, which was fometimes done too by pri- 
vate donors. The ftate feerns to have afllgned 
the acadamy to Plato, the Lyceum to Ariftotle, 
and the Portico to Zeno of Citta, the founder of 
the Stoics. But Epicurus bequeathed his gardens 
to his own fchool. Till about the time of 
Marcus Antoninus, however, no teacher ap- 
8 pears 





THE NATURE AND CAUSES Of 

pears to have had any falary from the public, 
or to have had any other emoluments, but what 
arofe from the honoraries or fees of his fcholars. 
The bounty which that philofophical emperor, as 
we learn from Lucian, beftowed upon one of the 
teachers of philofophy, probably lafted no longer 
than his own life. There was nothing equivalent 
to the privileges of graduation, and to have at- 
tended any of thofe fchools was not necefTary, in 
order to be permitted to praclife any particular 
trade or profeffion. If the opinion of their own 
utility could not draw fcholars to them, the law 
neither forced any body to go to them, nor re* 
warded any body for having gone to them. The 
teachers had no jurifdiclion over their pupils, 
nor any other authority befides that natural au- 
thority which fuperior virtue and abilities never 
fail to procure from young people towards thofe 
who are entrufled with any part of their educa- 
tion. 

AT Rome, the fludy of the civil law made a 
part of the education, not of the greater part of 
the citizens, but of fome particular families* 
The young people, however, who wifhed to ac- 
quire knowledge ^ in the law, had no public 
fchool to go to, and had no other method of 
ftudyingit, than by frequenting the company of 
fuch of their relations and friends as were fup* 
pofed to underfland it. It is perhaps worth while 
to remark, that though the laws of the twelve 
tables were, many of them, copied from thofe of 
fome ancient Greek republics, yet law never 
feems to have grown up to be a fcience in any 

republic 



THE WEALTH OF NATIONS, 
republic of ancient Greece. In Rome it be- 
came a fcience very early, and gave a confider- 
able degree of illuftraticn to thofe citizens who 
had the reputation of underflanding it. In the 
republics of ancient Greece, particularly in 
Athens, the ordinary coutts of jiiflice confided of 
numerous, and therefore diforderly, bodies of 
people, who frequently decided almoft at ran- 
dom, or as clamour, faction, and party fpirit hap- 
pened to determine. The ignominy of an unjuft 
decifion, when it was to be divided among five 
hundred, a thoufand, or fifteen hundred people 
(for fome of their courts were fo very numerous), 
could not fall very heavy upon any individual. 
At Rome, on the contrary, the principal courts 
of juftice confided either of a fingle judge, or of 
a fmall number of judges, whofe characters, 
efpecially as they deliberated always in public, 
could not fail to be very much affected by any 
rafli or mijufl decifion. In doubtful cafes, fuch 
courts, from their anxiety to avoid blame, wouiJ 
naturally endeavour to fhelter themfelves under 
the example, or precedent, of the judges who 
had fat before them, cither in the fame, or in 
fome other court. This attention to practice and 
precedent, necefTarily formed the R.otnan law 
into that regular and orderly fyftem in which it 
has been delivered down to us j and the like at- 
tention has had the like effects upon the laws of 
every other country where fuch attention has 
taken place. The fu;> \iority of character in the 
Romans over that of the Greeks, fo much re- 
marked by Pol\.bius ar>d Dlonyfius of Halicar- 
VOL. in. N a{Tu&, 





THE NATURE AND CAUSES -OF 
naffus, was probably more owing to the better 
conftitution of their courts of juftice, than to any 
of the circumftances to which thofe authors 
afcribe it. The Romans are" faid to have been 
particularly diftinguiflied for their fuperior refped 
to an oath. But the people who were accuftomed 
to' 'make oath only before fome diligent and well- 
informed court of juftice, would naturally be much 
more attentive to what they fwore, than they who 
were accuftomed to do the fame thing before 
mobbifh and diforderly aiTemblies. 

THE abilities, both civil and military, of the 
Greeks and Romans, will readily be allowed to 
have been, at lead, equal to thofe of any modern 
nation. Our prejudice is perhaps rather to over- 
rate them. But except in what related to mi- 
litary exercifes, the ftatq feems to have been at 
no pains to form thofe great abilities : for I can- 
not be induced to believe, that the mufical educa- 
tion of the Greeks could be of much confequence 
in forming them. Matters, however, had been 
found, it feems, for inflruding the better fort of 
people among thofe nations in every art and 
Icience'in which the circumflances of their fociety 
rendered it neceffary or convenient for them to 
be inflrucled. The demand for fuch inftru&ion 
produced, what it always produces, the talent 
for giving it ; and the emulation which an un- 
rcftrained competition never fails to excite, ap- 
pears to have brought that' talent to a very high 
degree of perfection. In the attention which the 
ancient philofophers excited, in the empire which 
th'ey acquired over the opinions and principles of 

their 



THE WEALTH OF ^ NATIONS. 179 

their auditors, in the faculty which they poffefled CH A P. 
of giving a certain tone and character to the con- 
dud and converfation of thofe auditors ; they 
appear to have been much fuperior to any modern 
teachers. In modern times, the diligence of 
public teachers is more or lefs corrupted by the 
circurnftances which render them more or lefs 
independent of their fuccefs and reputation in 
their particular profeflions. Their ialaries too 
put the private teacher, who would pretend to 
come into competition with them, in the fame 
ftate with a merchant who attempts to trade 
without a bounty, in competition with thofe who 
trade with a confidevable one. If he fells his 
goods at nearly the fame price, he cannot have 
the fame profit, and poverty and beggary at leafl, 
if not bankruptcy and Tuin, will infallibly be his 
lot. If he attempts to fell them much dearer he 
is likely to have fo few cuftomers that his cir- 
c.umftances will not be much mended* The 
privileges of graduation, befides, are in many 
countries neceffary, or at lead extremely con- 
venient to mofl men of learned profeflions ; than 
is, to the far greater part of thofe v/ho have oc- 
cafion for a learned education. But thofe pri- 
vileges can be -obtained only by attending the 
lectures of the public teachers. The mod care- 
ful attendance upon the ablefl inftru&ions of any 
private teacher, cannot always give any title to 
demand them. It is' from thefe different caufes 
that the private teacher of any of the fciences, 
which are commonly 'taught in univerfuks, is in 
N 2 modern 



r8b THE NATURE AND CAUSES OF 

BOOK modern times generally confidered as in the very 
v> . lowefl order of men of letters. A man of real 
abilities can fcarce find out a more humiliating or 
a more unprofitable employment to turn them to. 
The endowments of fchools and colleges have, in 
this manner, not only corrupted the diligence of 
publick teachers, but have rendered it almoft im- 
poflible to have any good private ones. 

WERE there no public inftitutions for education, 
no fyftem, no fcience would be taught for which 
there was not fome demand ; or which the cir- 
cumftances of the times did not render it either 
neceflary, or convenient, or at leaft fafhionable r 
to learn. A private teacher could never find his 
account in teaching either an exploded and an- 
tiquated fyftem of a fcience acknowledged to be 
Vifcful, or a fcience univerfally believed to be a. 
mere uielefs and pedantic heap of fophiflry and 
nonfenfe. Such fyftems, fuch fciences, can fubfilt 
no where, but in thole incorporated focieties for 
education whofc profperity and revenue are in a- 
great -meafure independent of their reputation, and 
altogether independent of their induflry. Were 
there no public inftitutjons for education, a gen- 
tleman, after going through, with application and 
abilities, the mod complete courfe of education 
\vhich the circumftances of the times were fup- 
poied to- afford,, could not come into, the world 
completely ignorant of every thing which is the 
common fubjecl of converfation among gentlemta 
and men of the world. 



THE WEALTH OF NATIONS. 181 

THERE are no public inflitutions for the educa- CHAP. 
lion of women, and there is accordingly nothing 
ufelefs, abfurd, or fantaftical in the common 
courfe of their education. They are taught what 
their parents or guardians judge it neceffary or ufe- 
ful for them to learn ; and they are taught nothing 
elfe. Every part of their education tends evi- 
dently to fome ufeful purpofe ; either to improve 
the natural attractions of their perfon, or to form 
their mind to referve, to modefty, to chaftity, 
and to ceconomy ; to render them both likely to 
become the miftreffes of a family, and to behave 
properly when they have become fuch. In every 
part of her life a woman feels fome conveniency or 
advantage from every part of her education. It 
feldom happens that a man, in any part of his 
life, derives any conveniency or advantage from 
fome of the mod laborious and troublefome parts 
of his education. 

OUGHT the public, therefore, to give no atten- 
tion, it may be afked, to the education of the 
people ? Or if it ought to give any, what are the 
different parts of education which it ought to at- 
tend to in the different orders of the people ? and 
in what manner ought it to attend to them ? 

IN fome cafes the ftate of fociety necefTarily 
places the greater part of individuals in fuch 
(Icuations as naturally form in them, without any 
attention of government, almoib all the abilities 
and virtues which that ftate requires, or perhaps 
can admit of. In other cafes the ftate of the 
fociety does not place the greater part of indi- 
viduals in fuch fituations, and fome attention of 
N 3 govern- 




i&2 THE NATURE AND CAUSES OF 

BOOK government is necefiary in order to prevent the 
almoft entire corruption and degeneracy of the 
great body of the people. 

IN the progrefs of the divifion of labour, the 
employment of the far greater part of thole who 
live by labour, that is, of the great body of the 
people, comes to be confined to a few very fimple 
operations 5 frequently to one or two. But the 
Vinderftandings of the greater part of men arc 
neceffarily formed by their ordinary employ- 
ments. The man v/hofe whole life is fpent ia 
performing a few fimple operations of which the 
effeds too are, perhaps, always the fame, or very 
nearly the fame, has no occaflon to exert his un- 
der (landing, or to exercife his invention in find- 
ing out expedients for removing difficulties which 
never occur. lie naturally lofes, therefore, the 
habit of fuch exertion, and generally becomes as 
flupid and ignorant as it is poflible for a human 
creature to become. The torpor of his mind 
renders him, not only incapable of reliming or 
bearing a part in any rational converfation, but 
of conceiving a ; ny generous, noble, or tender 
fentiment, and confequently of forming any juft 
judgment concerning many even of the ordinary 
duties of private life. Of the great and extenfive 
intereils of his country he is altogether incapable 
of judging; and unlefs very particular pains 
have been taken to render him otherwife, he is 
equally incapable of defending jiis country in 
war. The uniformity of his flationary life na- 
turally corrupts the courage of his mind, and 
makes him regard with abhorrence the irregular, 

uncertain. 



THE WEALTH OF NATIONS, 
uncertain, and adventurous life of a foldier. It 
corrupts even the activity of his body ; and renders 
him incapable of exerting his ftrength with vigour 
and perfeverance, in any other employment than 
that to which he has been bred. His dexterity at 
his own particular trade feems, in this manner, to 
be acquired at the expence of his intellectual, focial, 
and martial virtues. But in every improved and 
civilized fociety this is the ftate into which the 
labouring poor, that is, the great body of the 
people, mud neceflarily fall, unlefs government 
takes fome pains to prevent it. 

IT is otherwife in the barbarous focieties, as 
they are commonly called, of hunters, of fhep- 
herds, and even of hufbandmen in that rude (late 
of hufbandry which precedes the improvement of 
manufactures, and the extenfion of foreign com- 
merce. In fuch focieties the varied occupations 
of every man oblige every man to exert his ca- 
pacity, and to invent expedients for removing 
difficulties which are continually occurring. In- 
vention is kept alive, and the mind is not furTered 
to fall into that drowfy ftupidity, which, in a ci- 
vilized fociety, feems to benumb the underitand- 
ing of almoft all the inferior ranks of people. In 
thofe barbarous focieties, as they are called, every 
man, it has already been obferved,* is a warrior. 
Every man too is in fome meafure a ftatefman, 
and can form a tolerable judgment concerning 
the intereft of the fociety, and the conduct of 
thofe who govern it. How far their chiefs are 
good judges in peace, or good leaders in war, is 
obvious to the obfervation of almofl every fingle 

N 4 man 




184 THE NATURE AND CAUSES OF 

BOOK man among them. In fuch a fociety, indeed, no 
man can well acquire that improved and refined 
imderftanding, which a few men fometimes 
poffefs in a more civilized ftate. Though in a 
ruds fociety there is a good deal of variety in the 
occupations of every individual, there is not a 
great deal in t hole of the whole fociety. Every 
man does, or is capable of doing, almofl every 
thing which any other man does, or is capable 
of doing. Every man has a confiderable degree 
of knowledge, ingenuity, and invention ; but 
fcarce any man has a great degree. The degree, 
however, which is commonly pofTefied, is gene- 
rally fufficient for conducting the whole fimple 
bufmefs of the fociety. In a civilized Hate, on 
the contrary, though there is little variety in the 
occupations of the greater part of individuals, 
there is an almofl infinite variety in thofe of the 
whole fociety. Thefe varied occupations prefent 
an almofl infinite variety of objects to the con- 
templation of thofe few, who, being attached to 
no particular occupation themfelves, have leifure 
and inclination to examine the occupations of 
other people. The contemplation of fo great a 
variety of objects necefTarily exercifes their minds 
in endlefs ccmparifons and combinations, and 
renders their underilandings, in an extraordinary 
degree, both acute and comprehenfive. UnJefs 
thofe few, however, happen to be placed in fome 
very particular fituations, their greut abilities, 
though honourable to themfelves, may contribute 
very little to the good government or happinels 
of their fociety. Notwitliftanding the great abi- 
^ llties 



THE WEALTH OF NATIONS. if 

lities of thofe few, all the nobler parts of the CHAP 
human chara&er may be, in a great meafure, 
obliterated and extinguifhed in the great body of 
the people. 

THE education of the common people re- 
quires, perhaps, in a civilized and commercial 
fociety, the attention of the public more than 
that of people of fome rank and fortune. People 
of fome rank and fortune are generally eighteen 
or nineteen years of age before they enter upon 
that particular bufmefs, profeflion, or trade, by 
which they propofe to dittinguifh themfelves in 
the world. They have before that full time to 
acquire, or at leaft to fit themfelves for after- 
wards acquiring, every accomplifhment which 
can recommend them to the public efteem, or 
render them worthy of it. Their parents or 
guardians are generally fufficiently anxious that 
they mould be ib accompljfhed, and are, in moft 
cafes, willing enough to lay out the expence 
which is necefiary for that purpofe. If they are 
not always properly educated, it is feldom from 
the want of expence laid out upon their educa- 
tion ; but from the improper application of that 
expence. It is feldom from the want of matters ; 
but from the negligence and incapacity of the 
matters who are to be had, and from the dif- 
ficulty, or rather from the impoffibility which 
there is, in the prefent ftate of things, of finding 
any better. The employments too in which 
people of fome rank or fortune fpend the greater 
part of their lives,, are not, like thofe of the 
common people, fimple and uniform. They are 

aim oft 



86 THE NATURE AND CAUSES OF 

BOOK almoft all of them extremely complicated, and 
. fuch as exercife the head more than the hands. 
The underftandings of thofe who are engaged in 
fuch employments can feldom grow torpid for 
want of exercife. The employments of people of 
fome rank, and fortune, befides, are feldom fuch 
as harafs them from morning to night. They 
generally have a good deal of leifure, during 
which they may perfect themfelves in every branch 
either of ufeful or ornamental knowledge of which 
they may have laid the foundation, or for which 
they may have acquired fome tafte in the earlier 
part of lifec 

IT is otherwife with the common people, They 
have little time to fpare for education. Their 
parents can fear ce afford to maintain them even 
in infancy. As foon as they are able to work>, 
they mufl apply to fome trade by which they can 
earn their fubfiftence. That trade too is gene- 
rally fo fimple and uniform as to give little ex- 
ercife to the understanding; while, at the fame 
time, their labour is both fo conflant and fa 
fevere, that it leaves them little leifure and lefs in- 
clination to apply to, or even to think of any 
thing elfe. 

BUT though the common people cannot, in 
any civilized fociety, be fo well inflrucled as 
people of fome rank and fortune, the moft 
effential parts of education, however, to read, 
\vrite, and account, can be acquired at fo early a 
period of life, that the greater part even of thpfe 
who are to be bred to the lowed occupations, 
have time to acquire them before they can be 

employed 



THE WEALTH OF NATIONS. 187 

employed .in thofe occupations. For a very fmall c H A p ' 
expence the public can facilitate, can encourage, 
and can even impofe upon almofl the whole body 
of the people, the neceflity of acquiring thofe mod 
effential parts of education. 

THE public can facilitate this acquifition by 
efhbliming in every parifh or diftrict a little 
fchool, where children may be taught for a reward 
io moderate, that even a common labourer 
may afford it ; the matter being partly,, but not 
wholly paid by the public ; beouife, if he was 
wholly, or even principally paid by it, he would 
loon learn to neglect his bufmefs. In Scotland 
the eftablifhment of fuch parifh fchools has taught 
aimed the whole common people to read, and a 
very great proportion of them to write and ac- 
count. In England the eflablifhment of charity 
fchools has had an effect of the fame kind, though 
not fo univerfally, becaufe the eflablimment is not 
fo univerfal. If in thofe little fchools the books 
by which the children are taught to read, were 
a little more inftructive than they commonly 
are; and if, inftead of a little fmattering 
of Latin which the children of the common 
people are fometimes taught there, and which 
can fcarce ever be of any ufe to them ; they were 
inftrucled in the elementary parts of geometry and 
mechanics, the literary education of this rank of 
people would perhaps be as complete as can be. 
There is fcarce a common trade which does not 
afford fome opportunities of applying to it the 
principles of geometry and mechanics, and which 
would not therefore gradually exercife and im- 
prove 



z$S THE NATURE AND CAUSES OF 

BOOK prove the common people in thofe principles, the 
neceflary introduction to the mofl fublime as well 
as to the mod ufeful fciences. 

THE public can encourage the acquifition of 
thofe mod eifential parts of education by giving 
fmall premiums, and little badges of diftinclion, 
to the children of the common people who excel 
in them, 

THE public can impofe upon almod the whole 
body of the people the neceffity of acquiring 
the mod eflential parts of education, by obliging 
every man to undergo an examination or probation 
in them before he can obtain the freedom in any 
corporation, or be allowed to fet up any trade either 
in a village or town corporate. 

IT was in this manner, by facilitating the ac- 
quifition of their military and gymnaftic exer- 
cifes, by encouraging it, and even by impbfing 
upon the whole body of the people the neceffity 
of learning thofe exercifes, that the Greek and 
Roman republics maintained the martial fpirit 
of their refpe&ive citizens. They facilitated the 
acquifition of thofe exercifes by appointing a 
certain place for learning and praclifing them, 
and by granting to certain mailers the privilege 
of teaching in that place* Thofe maders do not 
appear to have had either falaries or exclufive 
privileges of any kind. Their reward confided 
altogether in what they got from their fcholars ; 
and a citizen who had learnt his exercifes in the 
public Gymnafia, had no fort of legal advantage 
over one who had learnt them privately, pro- 
vided the latter had learnt them equally well. 

Thofe 



THE WEALTH OF NATIONS. 1 

Thofe republics encouraged the acquifition of c H r A 
thofe exercifes, by bellowing little premiums 
and badges of diftinc~lion upon thofe who ex- 
celled in them. To have gained a prize in the 
Olympic, Iflhmian or Nemasan games, gave ii- 
luflration, not only to the perfon who gained it, 
but to his whole family and kindred. The obli- 
gation which every citizen was under to ferve a 
certain number of years, if called upon, in the 
armies of the republic, fufficiently impofed the 
neceflity of learning thofe exercifes without which 
he could not be fit for that ferviee. . 

THAT in the progrefs of improvement the 
practice of military exercifes, unlefs government 
takes proper pains to fupport it, goes gradually 
to decay, and, together with it, the martial fpiric 
of the great body of the people, the example of 
modern Europe fufEciently demonflrates. But 
the fecurity of every fociety mud always depend, 
more or lefs, upon the martial fpirit of the great 
body of the people, in the prefent times, in- 
deed, that martial fpirit alone, and unfupported 
by a well-difciplined (landing army, would not, 
perhaps, be fufficient for the defence and fecurity 
of any fociety. But where every citizen had the 
fpirit of a folclier, a fmaller Handing army would 
furely be requitite. That fpirit, befides, would 
neceflarily diminifh very much the dangers to 
liberty, whether real or imaginary, which are 
commonly apprehended from a {landing army. 
As it would very much facilitate the operations 
of that army againfl a foreign invader, fo it 
would obflrucl them as HWieh if unfortunately 
9 they 



190 THE NATURE AND CAUSES OF 

BOOK they mould evei be directed againft the conftitiitiori 
v * . of the ftate. 

THE ancient inftitutions of Greece and Rome 
feem to have been much more effectual, for main- 
taining the martial fpirit of the great body of 
the people, than the eftabljmment of what are 
called the militias of modern times. They were 
much more fimple. When they were once efta- 
blifhed, they executed themfelves, and it required 
little or no attention from government to main- 
tain them in the moft perfect vigour. Whereas 
to maintain, even in tolerable execution, the com- 
plex regulations of any modern .militia, requires 
the continual and painful attention of govern- 
ment, without which they are conftantly falling 
into total -neglect and difufe. The influence,- 
befides, of the ancient inftitutions was much 
more univerfal. By means of them the whole 
body of the people was completely inftructed in 
the life of arms. Whereas it is but a very fmall 
part of them who can ever be fo inftruded by the 
regulations of any modern militia ; except, per- 
haps, that of Switzerland. But a coward, a man 
incapable either of defending or of revenging 
himfelf, evidently wants one of the moft elTential 
parts of the character \of a man. He is as much 
mutilated and deformed in his mind as another 
is in his body, who is either deprived of fome of 
its moft eflential members, or has loft the ufe of 
them, lie is evidently the more wretched and 
miferable of - the two; becaufe happinefs and 
mifery, which refide altogether in the mind, mull 
necenarily depend more upon the healthful or 

unhealth- 



THE WEALTH OF NATIONS. i 9 r 

unhealthful, the mutilated or entire flate of the CHAP, 
mind, than upon that of the body. Even though 
the martial fpirit of the people were of no ufe 
towards the defence of the fociety, yet to pre- 
vent that fort of mental mutilation, deformity, 
and wretchednefs, which cowardice necelfarily in- 
volves in ft, from fpreading themfelves through 
the great body .of the people, would (till deferve 
the mod ferious attention of government ; in the 
fame manner as it would deferve its moil ferious 
attention to prevent a leprofy or any other loath- 
fome and offenfive difeafe, though neither mortal 
nor dangerous, from fpreading itielf among them ; 
tliQugh, perhaps, no other public good might re- 
fult from fuch attention besides the prevention of 
fo great a public evil. 

THE fame thing may be faid of the grofs ig- 
norance and ftupidity which, in a civilized fo- 
ciety, feem fo frequently to benumb the under- 
ftandings of all the inferior ranks of people. A 
man without the proper ufe of the intellectual 
faculties of a man, is, if poflible, more con- 
temptible than even a coward, and feems to be 
mutilated and deformed in a flill more eflential 
part of the character of human nature. Though 
the (late was to derive no advantage from the in- 
ftrucUon of the inferior ranks of people, it would 
itill deferve its attention that they mould not be 
altogether unin(tnic~led. The itate, however, 
derives no inconfiderable advantage from their 
inftru&ion. The more they are inflrucled, the 
lefs liable they are to the delufions of enthufiafm 
and fuperfliiion, which, among ignorant nations, 

frequently 



1 9 2 THE NATURE AND CAUSES OF 

BOOK frequently occafion the moft dreadful diforders. 
An inftru&ed and intelligent people befides, are 
always more decent and orderly than an ignorant 
and ilupid one. They feel themfelves, each in- 
dividually, more refpedable, and more likely to 
obtain the refpet of their lawful fuperiors, and 
they are therefore more difpofed to refpect thofe 
fuperiors. They are more difpofed to examine, 
and more capable of feeing through, the intereil- 
ccl complaints of faction and fedition, and they 
are, upon that account, lefs apt to be milled into 
any wanton or unnecelfary oppofition to the mea- 
fures of government. In free countries, where 
the fafety of government depends very much 
upon the favourable judgment which the people 
may form of its conduct, it mud furely be of the 
higheft importance that they fhould not be dif- 
pofed to judge rafhly or capricioufly concern- 
ing it. 

ARTICLE III. 

OftleExpence of the Infill utlons for the Inftruclhn 

of People of all ^ges. 

THE inftitutions for the inftruction of people 
of all ages are chiefly thofe for religious inftruct- 
tion. This is a fpecies of in-fur uction of which 
the object is not fo much to render the people 
good citizens in this world, as to prepare them 
for another and a better world in the life to come. 
The teachers of the doctrine which contains this 
infiruclion, in the fame manner as other teachers, 
may either depend altogether for their fubfift- 

ence 



THE WEALTH OF NATIONS. 193 

ence upon the voluntary contributions of their CHAP, 
hearers ; or they may derive it from fome other 
fund to which the law of their country may en- 
title them ; fuch as a landed eftate, a tythe or 
land tax, an eftablifhed falary or ftipend. Their 
exertion, their zeal and induftry, are likely to be 
much greater in the former fituation than in the 
latter. In this refped the teachers of new re- 
ligions have always had a confiderable ad van- 
tage in attacking thofe ancient and eftablifhed 
fyftems, of which the clergy, repofing themfelves 
upon their benefices, had neglected to keep up 
the fervour of faith and devotion in the great 
body of the people; and having given them- 
felves up to indolence, were become altogether 
incapable of making any vigorous exertion in 
defence even of their own eftablifhment. The: 
clergy of an eflablifhed and well-endowed reli- 
gion frequently become men of learning and 
elegance, who poflefs all the virtues of gentle- 
men, or which can recommend them to the 
efteem of gentlemen ; but they are apt gradually 
to lofe the qualities, both good and bed, which 
gave them authority and influence with the infe- 
rior ranks of people, and which had perhaps been 
the original caufes of the fuccefs and 'eftablifh- 
ment of their religion. Such a clergy j when 
attacked by a fet of popular and bold, though 
perhaps ftupid and ignorant enthufiafts, feel 
themfelves as perfectly defencelefs as the indolent, 
effeminate, and full-fed nations of the fouthern 
parts of Afia, when they were invaded by the 
active, hardy, and hungry Tartars of the "North. 
VOL. in. o Such 



J94 THE NATURE AND CAUSES OF 

BOOK Such a clergy, upon fuch an emergency, have 
commonly no other refouree than to call upon 
the civil magiftrate to perfecute, deftroy, or drive 
out their adverfaries, as difturbers of the public 
peace. It was thus that the Roman catholic 
clergy called upon the civil magiftrate to perfe- 
cute the -proteftants; and the church of Eng- 
land, to perfecute the difienters ; and that in 
general every religious fed, when it has once 
enjoyed for a century or two the fecurity of a 
legal eftabliihment, has found itfelf incapable of 
making any vigorous defence againft any new 
feel which chofe to attack its do&rine or difci-' 
pline. Upon fuch occafions the advantage in 
point of learning and good writing may fome- 
times be on the fide of the eftablifhed church. 
But the arts of popularity, all the arts of gain- 
ing profelytes, are conftandy on the fide of its 
adverfaries* In England thofe arts, have been 
long negle&ed by the well-endowed clergy of 
the eftablilhed church, and are at prefent chiefly 
cultivated by the diflenters and by the metho- 
dlfts. The independent provifions, however,, 
which in many places have been made for dif- 
fenting teachers, by means of voluntary fub* 
fcriptions, of trufl rights, and other evafions of 
the law, feem very much to have abated the zeal 
and adivity of thofe teachers. They have many 
of them become very learned, ingenious, and 
refpeftable men ; but they have in general ceafed 
to -be very popular preachers. The methodifts., 
without' Half .the learning of the diflenters, are 
much more in vogue. 



THE WEALTH OF NATIONS. r 95 

IN 'he church oi Rome, the induflry and zeal CHAP, 
of the inferior clergy are kept more alive by the 
powerful motive of felf-intereft, than perhaps in 
any eilablimed proteiiant church. The parochial 
clergy derive, man; of them, a very ecniiderable 
part of their fubfiftence from the voluntary obla- 
tions of the people ; a fource of revenue which 
confeflion gives them many opportunities of ini- 
provingi The mendicant orders derive their 
whole fubfnlence from fuch oblations. It id 
with them, as with the buffers and light infantry 
of fome armies ; no plunder, no pay. The pa- 
rochial clergy are like thofe teachers whofe re- 
ward depends partly upon their falary, and partly 
upon the fees or honoraries which they get front 
their pupils ; and thefe muft always defend nlore 
or lefs upon their induftry and reputation. The 
mendicant orders are like thofe teachers whofe 
fubfiilence depends altogether upon their in- 
duflry. They are obliged, therefore, to ufe every 
art which cari animate the devotion of the com-' 
mon people, The eftablifhment bf the two 
great mendicant orders of St. Dominic and St. 
Francis, it is obferved by Machiavei, revived, in 
the thirteenth and fourteenth centuries, the lan- 
guifhing faith and devotion of the catholic 
church. In Roman catholic countries the fpirit 
of devotion is fupported altogether by the monks 
and by thfc poorer parochial clergy. The great 
dignitaries of the church, with all the aecom* 
plimments of gentlemen and men of the world, 
and fometimes with thofe of men of learning, are 
careful enough to maintain the neceffary difci- 

e 2 plinc 



196 THE NATURE AND CAUSES OF 

BOOK* pline over their inferiors, but feldom give them* 
felves any trouble about the inftruction of the 
people. 

" MOST of the arts and profeflions in a date," 
fays by far the moll illuftrious philofopher and 
hiftorian of the prefent age, 6( are of fuch a na- 
" ture, that, while they promote the interefts of 
** the fociety, they are alfo ufeful or agreeable to 
" fome individuals ; and in that cafe, the cori- 
" flant rule of the magiftrate, except, perhaps, 
* c on the firjfl introdu&ion of any art, is, to leave 
< c the profefllon to itfelf, and truft its encourage- 
" ment to the individuals who reap the benefit 
" of it. The artizans, finding their profits to 
<c rife by the favour of their customers, increafe, as 
** much as poffible, their {kill and induflry ; and 
cc as matters are not diflurbed by any injudicious 
" tampering, the commodity is always fure to 
<c be at all times nearly proportioned to the de- 
" mand. 

" BUT there are alfo fome callings, which, 
14 though ufeful and even necelTary in a ftattv 
u bring no advantage or pleafure to any indivi- 
" dual, and the fupreme power is obliged to alter 
ftc its conducl: with regard to the retainers of thole 
" profeflions. It muft give them public encou- 
* c ragemcnt in order to their fubfiftence ; and it 
* c mud provide againft that negligence to which- 
fc they wi'M naturally be fubj.ec\ either by annex- 
frc ing particular honours to the profeflion, by 
*' eftablilliing a long fubordination of ranks and 
" a ftrid depcndance, or by fome other expe- 
Cf dient. The perfons employed in the finances^ 

fleets. 



THE WEALTH OF NATIONS. 197 

<c fleets, and magiftracy, are inftances of this or- c H A P. 
<c der of men. 

* c IT may naturally be thought, at firft fight, 
" that the ecclefiaftics belong to the firft clafs, 
" and that their encouragement, as well as that 
" of lawyers and phyficians^ may fafely be en- 
<c trufted to the liberality of individuals, who 
<c are attached to their doctrines, and who find 
<f benefit or confolation from their fpiritual mi- 
<c niftry and affiftance. Their induftry and vi- 
" gilance will, no doubt, be whetted by fuch an 
* c additional motive ; and their Ikill in the pro- 
" fefiion, as well as their addrefs in governing 
" the minds of the people, muft receive daily in- 
" creafe, from their increafing practice, ftudy, 
" and attention. 

u BUT if weconfider the fnatter more clofely, 
" we (hall find, that this interested diligence of 
*< the clergy is what every wife legiflator will 
" ftudy to prevent; becaufe in every religion 
" except the true, it is highly pernicious, and it 
" has even a natural tendency to pervert the true, 
Cf by infufing into it a ftrong mixture of fuperfti- 
" tion, folly, and delufion. Each ghoftly prac- 
" titioner, in order to render himfelf more pre- 
c * cious and facred in the eyes of his retainers, 
" will infpire them with the moft violent abhor- 
cc rence of all other fe&s, and continually en- 
" deavour, by fome novelty, to excite the Jan- 
** guid devotion of his audience. No regard 
" will be paid to truth, morals, or decency, in 
" the doctrines inculcated. Every tenet will be 
" adopted that beft fuits the diforderly affections 

o 3 " of 



' 9 S THE NATURE AND CAUSES OF 

BOOK * c of the human frame. Cuflorners will be drawn 
Cf to each conventicle by new induftry and addrefs 
" in pra&ifmg on the paffions and credulity of 
<c the populace. And in the end, the civil ma* 
< f giftrate will find, that he has dearly paid for 
cf his pretended frugality, in faving a fixed efta- 
<c blifhment for the priefts ; and that in reality the 
'* mod decent and advantageous coropofitioi, 
<c which he can make with the Jpiritual guides, 
" is to bribe their indolence, by aligning dated 
" falaries to their profeifion, and rendering it fu- 
<c perflueus for them to be farther aclive, than 
" merely to prevent their flock from ftraying in 
* c queft of new pa.ftures. And in this manner 
ec eccleiiaflical eftabliihments, though commonly 
te they aroie at firft from religious vievvs, prove 
<f in the end advantageous to the poliiical inte- 
" refts of ibciety." 

BUT whatever may have been the good or bad 
effeds of the independent provifion of the clergy ; 
it has, perhaps, beeri very feldom beftowed upon 
them from any view to thofe effeds. Times of 
violent religious controverfy "have generally been 
times of equally violent political faction. Upon 
fuch occafions each political party has either 
found it, or imagined it, for his intereft, to league 
itfelf with ibme one or other of the contending 
religious fedb. But this could be done only by 
adopting, or at lead by favouring, the tenets of 
that particular fe&. The feel: which had the 
good fortune to be leagued with the conquering 
party, neceflarily fhared in the victory of its ally, 
hy whofe favour and protection it was foon en- 
abled 



THE WEALTH OF NATIONS. 199 

afoled in fome degree to filence and fubdue all CHAP. 
Us adverfaries. Thofe adverfaries had generally 
leagued themfelves with the enemies of the con- 
quering party, and were therefore the enemies of 
that party. The clergy -of this particular feel 
having thus become complete matters of the 
field, and their influence and authority with the 
great body of the people being in its higheft 
vigour, they were powerful enough to over-awe 
the chiefs and leade-rs of their own party, and to 
oblige the civil magiftrate to refped their opi- 
nions and inclinations. Their firft demand was 
generally, that he fhould filence and fubclue all 
their adverfaries ; and their fecond, that he ihould 
bellow an independent provision on themfelves* 
As they had generally contributed a good deal 
to the victory, it feerned not unreafonable that 
they mould have fome '(hare in the fpoil. They 
were weary, befidee, of humouring the people, and 
of depending upon thei-r caprice for a fubfiilence. 
In making this demand, therefore., they confulted 
their own -cafe and comfort, without troubling 
themfelves about t-he .effect which it might have 
in future .times upon the influence and authority 
of their order. The civil magiftrate, who could 
comply with their demaad only by giving them 
fomething which .he would have chofen much ra- 
ther to take, or to .keep to hiinfelf, was feldom 
very forward to grant it. Neceflicy, however, 
always forced him to fubmit at lad, though fre- 
quently not till after many delays, evasions, and 
affected excufes. 

BUT if politics had nev^r called in the aid of 
.religion, had the conquering party never adopted 

o 4 the 



200 THE NATURE AND CAUSES OF 

BOOK the tenets of one feel more than thofe of another, 
when it had gained the viclory, it would pro- 
bably have dealt equally and impartially with all 
the different feels, and have allowed 'every man 
to chufe his own pried and his own religion as 
Jie thought proper. There would in this cafe, 
no doubt* have been a great multitude of reli- 
gious feels. Almoft every different congrega- 
tion might probably have made a little feet by 
itfelf, or have entertained fome peculiar tenets 
of its own. Each teacher would no doubt have 
felt himfelf under the necedity of making the 
utmofb exertion, and of ufmg every art both to 
preferve and to increafe the number of his dif- 
ciples. But as every other teacher would have 
felt himfelf under the fame neceflity, the fuccefs 
of no one teacher, or feel of teachers, could have 
been very great. The huerefted and aclive zeal 
pf religious teachers can be dangerous and 
(roublefome only where there is, either but one 
feet tolerated in the fociety, or where the whole 
of a large fociety is divided into two or three 
great feels ; the teachers of each acling by con- 
cert, ajid under a regular difcipline and fubor- 
dination. But that zeal muft be altogether inno- 
cent, where the fociety is divided into two or 
three hundred, or perhaps into as many thoufand 
fmall feels, of which no one could be confideiv 
^ble enough to dillurb the public tranquillity. 
The teachers of each feel, feeing themfelves fur* 
rounded on all fides with more adyerfaries than 
friends, would be obliged tp learn that candour 
and moderation which are fo feldom to be found 
among the teachers of thofe great feels, whole 

tenets, 



THE WEALTH OF NATIONS. 201 

tenets, being fupported by the civil magiflrate, CHAP. 
are held in veneration by almoft all the inha- 
bitants of extenfive kingdoms and empires, and 
who therefore fee nothing round them but fol- 
lowers, difciples, and humble admirers. The 
teachers of each little feel:, finding themfelves 
almoft alone, would be obliged to refpecl: thofe 
of almoft every other feel, and the conceflions 
which they would mutually find it both conve- 
nient and agreeable to make to one another, 
might in time probably reduce the doctrine of 
the greater part of them to that pure and ra- 
tional religion, free from every mixture of ab- 
furdity, impofture, pr fanaticifm, fuch as wife men 
have in all ages of the world wifhed to fee efta- 
blifhed ; but fuch as pofitive law has perhaps never 
yet eftablifhed, and probably never will eftablifh 
in any country ; becaufe, with regard to religion, 
pofitive law always has been, and probably al- 
ways will be, more or lefs influenced by popular 
fuperftition and enthufiafm. This plan of ec- 
clefiaftical government, or more properly of no 
ecclefiaftical government, was what the fed: called 
Independents, a fed no doubt of very wild en- 
thufiafts, propofed to eftablifh in England to- 
wards the end of the civil war. If it had been 
eftablifhed, though of a very unphilofophical 
origin, in would probably by this time have been 
productive of the moft philofophical good tem- 
per and moderation with regard to every fort of 
religious principle. It has been eftablifhed in 
Pennfylvania, where, though the Quakers happen 
(o be the moft numerous, the law in reality fa- 
vours 



102 THE NATURE A>CD CAUSES OT 

BOOK vours no one fed more than another, and it is 
there faid to have been produdive of this philo- 
fophical good temper and moderation. 

BUT though this equality of treatment fhould 
aot be productive of this good temper and mo- 
deration in all, or even in the greater part of the 
religious feds of a particular country ; yet pro- 
vided thofe feds were fufficiently numerous, and 
each of them confequently too (mall to difturb 
the pubHck tranquillity, the exceffive zeal of 
each for its particular tenets, could not well be 
produdive of any very hurtful effeds, but, on 
the contrary, of feveral good ones ; and if the 
government was perfedly decided both to let 
them all alone, and to oblige them all to let alone 
one another, there is little danger that they 
\vould not of their own accord fubdivide them- 
felves fali enough, ib as foon to become fufficiently 
numerous. 

IN every civilized fociety, in every fociety 
where the diftin&ion of ranks has once been com- 
pletely eftablimed, there have been always two 
different fchemcs or fy items of morality current 
at the fame time ; of which the one may be called 
the ft rid or auilere ; the other the liberal, or, if 
you will, the loofe fyftern. The former is ge- 
nerally admired and revered by the common peo- 
ple : the latter is commonly more efteemed and 
adopted by what are called people of fafhion. 
The degree of disapprobation with which we 
ought to mark the vices of levity, the vices which 
are apt to arife from great profperity, and from 
the excefs of gaiety and good humour, feems to 

conflitute 



THE WEALTH OF NATIONS. 203 

ite the principal mftin&ion between thofe CHAP. 
tw * oppoiitt- tciiemes or fyftems. In the liberal 
or luofe fyftcin, luxury, wanton, and even dif- 
orderly -irth, the purluit of pleafure to fome 
cK-<rree ot intemperance, the breach of chaftity; 
at lead in one of the two fexes, &c. provided they 
are not accompanied with grofs indecency, and 
do iK't lead to falfehood and injufticc, are generally 
treated with a good- deal of indulgence, and are 
eaiily ei'h -r excufed or pardoned altogether. In 
the aufter^ fyflem, on the contrary, thofe excefTes 
are rega-ded with the utmoft abhorrence and 
deteflation. The vices of levity are always 
ruinous to the common people, and a Tingle 
week's thoughtlefmefs and diflipation is often 
fufficient t/ undo a poor workman for ever, and 
to driv him through defpair upon committing 
the nioft enormous crimes. The wifer and better 
ibrt of the common people, therefore, have al- 
ways the utmoft abhorrence and detef-ation of 
fuch excelTes, which their experience tells them 
are fo immediately fatal to people of their condi- 
tion. The diforder and extravagance of ieveral 
years, on the contrary, will not always ruin a 
man of fafhion, and people of that rank are very 
apt to confider the power of indulging in fome 
degree of excefs as one of the advantages of their 
fortune, and the liberty of doing fo without cen- 
fure or reproach, as one of the privileges which 
Belong to their ftation. In people of their own 
ftation, therefore, they regard fuch exceffes with 
tut a fmall degree of diiapprobation, and cenfure 
them either very ilightly or not at all, 



204 THE NATURE AND CAUSES OF 

BOOK ALMOST all religious feds have begun among 
the common people, from whom they have gene- 
rally drawn their earlieft, as well as their moil 
numerous profelytes. The auftere fyftem of 
morality has, accordingly, been adopted by thofe 
feds almoft conftantly, or with very few excep- 
tions ; for there have been fome. It was the 
fyftem by which they could beft recommend them- 
felves to that order of people to whom they 
flrft propofed their plan of reformation upon what 
had been before eftablifhed. Many of them, 
perhaps the greater part of them, have even en- 
deavoured to gain credit by refining upon this 
auftere fyftem, and by carrying it to fome degree 
of folly and extravagance; and this exceflive 
rigour has frequently recommended them more than 
any thing elfe to the refpecl and veneration of the 
common people. 

A MAN of rank and fortune is by his ftatioiit 
the diftinguimed member of a great fociety, who 
attend to every part of his conduct, and who 
thereby oblige him to attend to every part of 
it himfelf. His authority and confederation de- 
pend very much upon the refpect which this fo- 
ciety bears to him. He dare not do any thing 
which would difgrace or difcredit him in it, and he 
is obliged to a very ftridT: obfervation of that fpecies 
of morals, whether liberal or auftere, which the 
general confent of this fociety prefcribes to per- 
fons of his rank and fortune. A man of low con- 
dition, on the contrary, is far from being a diftin- 
guimed member of any great fociety. While he 
remains jn a country village, hfs conduct may be 

attended 



THE WEALTH OF NATIONS. 2c; 

attended to, and he may be obliged to attend to it c H A p - 
himfelf. In this fituation, and in this fituation only, 
he may have what is called a character to lofe. But 
as foon as he comes into a great city, he is funk in 
obfcurity and darknefs. His conduct is obferved 
and attended to by nobody, and he is therefore very 
likely to neglecl it himfelf, and to abandon himfelf 
to every fort of low profligacy and vice. He never 
emerges fo effectually from this obfcurity, his con- 
duel: never excites fo much the attention of any re- 
fpeclable fociety, as by his becoming the member 
of a fmall religious feel:. He from that moment 
acquires a degree of confideration which he 'never 
had before. All his brother fedaries are, for the 
credit of the fed, interefted to obferve his conducl, 
and if he gives occafion to any fcandal, if he de- 
viates very much from thofe auftere morals which 
they almoft always require of one another, to 
punifh him by what is always a very fevere pu- 
nifhment, even where no evil effects attend it, ex- 
pulfton or excommunication from the feel:. In 
little religious feels, accordingly, the morals of the 
common people have been almoft always remark- 
ably regular and orderly ; generally much more fo 
than in the eftablifhed church. The morals of 
thofe little feels, indeed, have frequently been rather 
difagreeably rigorous and unfocial. 

THERE are two very eafy and effectual re- 
medies, however, by whofe joint operation the 
flate might, without violence, correct whatever 
was unfocial or disagreeably rigorous in the morals 
of all the little feds into which the country was 
divided* 

TH* 



206 THE NATURE AND CAUSES OF 

BOOK THE firlfc of thofe remedies is the ftudy of fcierrce 
and philofophy, which the Hate might render 
almoft univerfal among all people of middling 
or more than middling rank and fortune; not 
by giving falavies to teachers in order to make 
them negligent and idle, but by inftituting fome 
fort of probation, even in the higher and more 
difficult fciences, to be undergone by every per- 
fon before he was permitted to exercife any IN 
beral profeflion, or before he could be received 
as a candidate for any honourable office of truft 
or profit. If the ftate impofed upon this order of 
meo-the neceffity of learning, it would have no 
occ'afion to give itfelf any trouble about pr^vid* 
ing them with proper teachers. They would 
foon find better teachers for themfelves than any 
whom the ftate could provide for them. Science 
is the great antidote to the poifon of enthufiaim 
and fuperftition ; and where all the fuperier ranks 
of people were fecured from it, the inferior ranks 
could not be much expofed to it. 

THE fecond of thofe remedies is the frequency 
and gaiety of public diverfions. The ftate, by 
encouraging, that is by giving entire liberty to 
all thofe who for their own intereft would at- 
tempt, without fcandal or indecency, to amufe 
and divert the people by painting, poetry, mufic* 
dancing ; by alt forts of dramatic reprefentations 
and exhibitions ; would eafily difljpate, in the 
greater part of them, that melancholy and gloomy 
humour which is almoft always the nurfe of 
popular fuperftition and enthufiafm. Public di- 
verfions have always been the objects of dread' 

and 



THE WEALTH OF NATIONS. 

and hatred, to all the fanatical promoters of thofe 
popular frenzies. The gaiety and good humour 
which thofe diverfions infpire were altogether in- 
confident with that temper of mind which was 
fitted for their purpofe, or which they could beil 
work upon. Dramatic reprefentations, befides, 
frequently expofing their artifices to public ri- 
dicule, and fometimes even to public execra- 
tion, were, upon that account, more than all other 
diverfions, the objects of their peculiar abhor- 
rence. 

IN a country where the law favoured the teachers 
of no one religion more than thofe of another, it 
would not be necefiary that any of them mould 
have any particular or immediate dependency upon 
the fovereign or executive power j or that he mould 
have any thing to do, either in appointing, or in 
difmifling them from their offices. In fuch a 
fituation he would have no occafion to give him- 
felf any concern about them, further than to keep 
the peace among them, in the fame manner as 
among the rcfl of his fubjefls ; that is, to hinder 
them from perfecuting, abufing, or oppreffing one 
another. But it is quite otherwife in countries 
where there is an eftabliflied or governing religion, 
The fovereign can in this cafe never be fecure, 
unlefs he has the means of influencing in a con* 
fiderable degree the greater part of the teachers of 
that religion. 

THE clergy of every eflabliihed church con* 

flitute a great incorporation. They can aft in 

concert, and purfue their intereft upon one plan, 

and with one fpirit, as much, as if they were under 

5 the 




2o8 THE NATURE AND CAUSES OF 

BOOK the dire&ion of one man ; and they are frequently 
too under fuch dire&ion. Their intereft as an 
incorporated body is never the fame with that of 
the fovereign, and is fometimes directly oppoiite 
to it. Their great intereft is to maintain their 
authority with the people ; and this authority 
depends upon the fuppofed certainty and import-* 
ance of the whole doctrine which they inculcate, 
and upon the fuppofed neceflity of adopting every 
part of it with the moft implicit faith, in order 
to avoid eternal mifery. Should the fovereign 
have the imprudence to appear either to deride 
or doubt himfelf of the moft trifling part of their 
doctrine, or from humanity attempt to protect 
thofe who did either the one or the other, the 
punctilious honour of a clergy who have no fort 
of dependency upon him, is immediately pro- 
voked to profcribe him as a profane perfon, 
and to employ all the terrors of religion in order 
to oblige the people to transfer their allegiance 
to fome more orthodox and obedient prince* 
Should he oppofe any of their pretensions or 
ufurpations, the danger is equally great. The 
princes who have dared in this manner to rebel 
againft the church, over and above this crime 
of rebellion, have generally been charged too with 
the additional crime of herefy, notwithflanding 
their folemn proteftations of their faith , and 
humble fubmiflion to every tenet which me 
thought proper to prefcribe to them. But the 
authority of religion is fuperior to every other an- 
thority. The fears which it fuggefts conquer all 
other fears. When the authorifed teachers of re- 
i iigioA 




THE WEALTH OF X NATIONS. 209 

li'gion propagate through the great body of the G H f A p * 
people dodrines fubverfive of the authority of the 
fovereign, it is by violence only, or by the force 
of a (landing anriy, that he can maintain his 
authority. fcv*en a (landing army cannot in this 
cafe give him any lading fecurity; becaufe if the 
foldiers are riot foreigners^ which can feldom bs 
the cafe, but drawn from the great body of the 
people, which mud almoft always be the cafe, 
they are likely to be foon corrupted by thofe very 
doctrines. The revolutions which the turbulence 
of the Greek clergy was continually occafioning 
at Conflantinople, as long as the eaftern empire 
fubfifted ; the convulfions which, during the 
courfe of feveral centuries, the turbulence of the 
Roman clergy was continually occafioning in 
every part of Europej fufficiently demonflrate 
how precarious and infecure mutt always be the 
fituation of the fovereign who has no proper means 
of influencing the clergy of the e(labli(hed and 
governing religion of his country. 

ARTICLES of faith, as well as all other (pin* 
trial matters, it is evident enough, are not within 
the proper department of a temporal fovereign, 
who, though he may be very well qualified for 
protecting, is feldom fuppofed to be fo for in- 
flrucling the people. With regard to fuch matters, 
therefore, his authority can feldom be fufficient 
to counterbalance the united authority of the 
clergy of the eftablifhed church. The public 
tranquillity, however, and his own fecurity, may 
frequently depend upon the doclrines which they 
may think proper to propagate concerning fuch 

VOL. in. p ~ matters* 




THE NATURE AND CAUSES OF 

matters. As he can feldom directly oppofe their* 
deciiion, therefore, with proper weight and au- 
thority, it is neceflary that he mould be able to 
influence it ; and he can influence it only by the; 
fears and expectations which he may excite in the 
greater part of the individuals of the order. Thofe* 
fears and expectations may eonfift in the fear of de- 
privation or other punifhment, and in the expecta- 
tion of further preferment. 

IN all Chriflian churches the benefices of the 
clergy arc a fort of freeholds which they enjoy, " 
not during pleafuTe, but during life, or good be- 
haviour. If they held them by a more preca- 
rious tenure, and were liable to be turned out 
upon every flight difobligation either of the fo- 
vereign or of his minifters, it would perhaps be 
impoflible for them to maintain their authority 
with the people, who would theU'Confider them 
as mercenary dependants upon the court, in the 
fincerity of whofe inductions they could no 
longer have any confidence. But mould the ib- 
vereign attempt irregularly, and by violence, to 
deprive any number of clergymen of their free- 
holds, on account, perhaps, of their having pro- 
pagated, with more than ordinary zeal, fom'e 
factious or fedkious doctrine, he would only 
render, by fuch perfecution, both them and their 
do&ine ten times more popular, and therefore 
ten times more troublefome and dangerous than 
they had been before. Fear is. in almofl all cafes 
a wretched inftruinent of government, and ought 
in particular never to be employed againft any 
order of men who have the fmailelt pretenfioiis to 
9 . jads-- 



THE WEALTH OF NATIONS. 

independency. To attempt to terrify them, ferves c HA P 
only to irritate their bad humour, and to confirm 
them in an oppofition which more gentle ufage 
perhaps might eafily induce them, either to foften, 
or to lay afide altogether. The violence which 
the French government ufually employed in order 
to oblige all their parliaments, or fovereign courts 
of juflice, to enregifter any unpopular edict, very 
feldom fucceeded* The means commonly em- 
ployed, however, the imprifonment of all the 
refractory members, one would think were 
forcible enough. The princes of the houfe of 
Stuart fometimes employed the like means in 
order to influence fome of the members of the 
parliament of England ; and they generally found 
them equally intractable. The parliament of 
England is now managed in another manner ; 
and a very fmall experiment, which the duke of 
Choifeul made about twelve years ago upon the 
parliament of Paris, demonflrated fufficiently 
that all the parliaments of France might have 
been managed (till more eafily in the fame manner. 
That experiment was not purfued. For though 
management and perfuaiion are always the eafieft 
and fafeft inftruments of government, as force 
and violence are the worft and the molt danger- 
ous, yet fuch, it feems, is the natural iniblence 
of man, that he almoft always difdains to ufe the 
g'ood inftrument, except when he cannot or dare 
not ufe the bad one. The French government 
could and dur (I ufe force, and therefore difdained 
to ufe management and perfuafion. But there 
is no order of men, it appears, I believe, from 
p 2 the 



213 ?HE NATURE AND CAUSES OF 

B OOK the experience of all ages, upon whom it is f<3 
dangerous, or rather fo perfectly ruinous, to em- 
ploy force and violence, as upon the refpeled 
clergy of an eftabliflied church. The rights, the 
privileges, the perfonal liberty of every individual 
eeclefiaftic, who is upon good terms with his own 
order, are, even in the moft defpotic govern- 
ments, more refpected than thofe of any other 
perfon of nearly equal rank and fortune. It is fo 
in every gradation of defpotifm, from that of the 
gentle and mild government of Paris, to that 
of the violent and furious government of Con- 
ftantinople. But though this order of men can 
frarce ever be forced, they may be managed as 
eafily as any other ; and the fecurity of the fove- 
rcign, as well as the public tranquillity, feems to 
depend very much upon the means which he has 
of managing them ; and thofe means feem to con- 
iiit altogether in the preferment which he has to 
beftow upon them. 

IN the ancient conftitution of the Chriftian 
church, the bimop of each diocefe was ele&ed 
by the joint votes of the clergy and of the people 
of the epi (copal city. The people did not long 
retain their right of election ; and while they did 
retain it, they almoft always acted under the in- 
iuience of the clergy, who in fuch fpiritual matters 
appeared to be their natural guides. The clergy, 
however, foon grew weary of the trouble of 
managing them, and found it eafier to elect their 
own bilbops themfelves. The abbot, in the 
fume manner, was elected by the monks of the 
monaftery, at lead in the greater part of .abbacies* 

All 



THE WEALTH 6F NATIONS. 213 

Ail the inferior ecclefiaflicai benefices compre- CHAP. 
hended within the diocefe were' collated by the 
bimop, who beflowed them upon fuch ecclefiaftics 
as he thought proper. All church preferments 
were in this manner in the difpoful of the church. 
The fovereign, though he might have fome indU 
recc influence in thole elections, and though it 
was fometimes ufual to afk both his confent to 
elect, and his approbation of the election, yet had 
no direct or fudicient means of managing the 
clergy. The ambition of every clergyman natu- 
rally led him to pay court, not fo much to his 
fovereign, as to his own order, from which only 
he could expect preferment. 

TZ-IROUGH the greater part of Europe the Pope 
gradually drew to himfelf firft the collation of 
almoft all bifhoprics and abbacies, or of what 
were called Confiilorial benefices, and afterwards, 
by various machinations and pretences, of the 
greater part of inferior benefices comprehended 
within each diocefe ; little more being left to the 
bifhop than what was barely ncceilary to give 
him a decent authority with his own clergy. By 
this arrangement the condition of the fovereigu 
was ilill worfe than it had been before. The 
clergy of all the different countries of Europe 
were thus formed into a fort of fpiritual army, 
difperfed in different quarters, indeed, but of 
which all the movements and operations could 
now be directed by one head, and conducted 
upon one uniform plan. Th clergy of each 
particular country might be coufidered as a par-* 
ticular detachment of that arniy, of which the. 

p 3 opera* 



2H THE NATURE AND CAUSES OF 

BOOK operations could eafily be fupported and feconded 
by all the other detachments quartered in the 
different countries round about. Each detach- 
ment was not only independent of the fovereign 
of the country in which it was quartered, and by 
which it was maintained, but dependent upon a 
foreign fovereign, who could at any time turn its 
arms againft the fovereign of that particular coun- 
try, and fupport them by the arms of all the other 
detachments. 

THOSE arms were the moft formidable that can 
well be imagined. In the ancient ftate of Europe, 
before the eflablifliment of arts and manufactures, 
the wealth of the clergy gave them the fame 'fort 
of influence over the common people, which 
that of the great barons gave them over their re- 
fpe&ive vaflals, tenants, and retainers. In the 
great landed eftates, which the miftaken piety 
both of princes and 'private perfons had beftowed 
upon the church, jurifdicHons were eftablimed 
of the fame kind with thofe of the great barons j 
and for the fame reafon. In thofe great landed 
eftates, the clergy, or their bailiffs, could eafily 
keep the peace without the fupport or afliflance 
either of the king or of any other perfon ; and 
neither the king nor any other perfon could keep 
the peace there without the fupport and affiftance 
of the clergy. The jurifdi&ions of the clergy* 
therefore, in their particular baronies or manors, 
were equally independent, and equally exclufive 
of the authority of the king's courts, as thofe of 
the great temporal lords. The tenants of the 
clergy were, like thofe of the great barons, almoft 

all 




T.HE WEALTH OF NATIONS. 215 

all tenants at -will, entirely dependent upon their 
immediate lords, and therefore liable to be called 
out at pleafure, in order to fight in any quarrel 
in which the clergy might think proper to engage 
them. Over and above the rents of thofe eftates, 
the clergy pofiefled, in the tythes, a very large 
portion of the rents of all the other eftatcs in 
.every kingdom of Europe. , The revenues arifing 
from both thofe fpecies of rents were, the greater 
part of them, paid in kind, in corn, wine, cattle, 
poultry, &c. The quantity exceeded greatly 
what the clergy could themfelves confume; and 
there were neither arts nor manufactures for the 
produce of which they could exchange the fur- 
plus. The clergy could derive advantage from 
this immenfe furplus in no other way than by em- 
ploying it, as the great barons employed the like 
furplus of their revenues, in the moil profufe 
hofpitality, and in the mod extenfive charity. 
Both the hofpitalicy and the chanty of the ancient 
clergy, accordingly, are faid to have been very 
great. They not only maintained almoft the 
whole poor of every kingdom, but many knights 
and gentlemen had frequently no other means of 
fubfiftence than by travelling about from rnona- 
ftery to monaflery, under pretence of devotion, 
but in reality to enjoy the hofpitality of the clergy. 
The retainers of ibme particular prelates were 
often as numerous as thofe of the greateft lay- 
lords ; and the retainers of all the clergy taken 
together were, perhaps, more numerous than 
thofe of all the lay-lords. There was always 
much more union among the clergy than among- 

P 4 the 




TIJE NATURE AND CAUSES OF 
BOOK the lay- lords. The former were under a 

difcipline and fubordination to the papal autho- 
rity. The latter were under no regular difcipline 
pr fubordination, but alrnofl always equally 
jealous of one another, and of the king. Though 
the tenantc and retainers of the clergy, there* 
fore, had both together been lefs numerous than 
thofe of the great lay-lords, and their tenants 
were probably much lefs numerous, yet their, 
union would have rendered them more formi- 
dable. The hofpitality and charity of the clergy 
too, not only gave them the comman4 of 9. great 
temporal force, but increafed very much the 
weight of their fpiritual weapons. Thofe virtues 
procured them the highefl refpect and veneration 
among all the inferior ranks of people, of whom 
many were conflantly, and almoft all occafionaU 
ly, fed by them. Every thing belonging or re- 
lated to fo popular an order, irs pofTdfions, its 
privileges, its doctrines, necefiarily appeared 
facred in the eyes of the common people, and 
every violation of them, whether real or pre- 
tended, the highefl: act of facrilegious wickednefs 
^nd profanenefs. In this ilate of things, if the 
fovereign frequently found it difficult to refift the 
confederacy of a few of the great nobility, we 
cannot wonder that he ihould find it flill more 
fo to refill the united force of the clergy of his 
own dominions, fupported by that of the clergy 
of all the neighbouring dominions. In fuch cir- 
cumftances the wonder is, not that he was fome- 
times obliged to yield, but that he ever was able to 
refill. 

THE 



THE WEALTH OF NATIONS. 217 

privileges of the clergy in thofe ancient C H A p f 
times (which to us who live in the prefent times 
appear the mod abfurd), their total exemption 
from the fecular jurifdidion, for example, or 
what in England was called the benefit of clergy ; 
were the natural or rather the neceflary confe- 
quences of this flate of things. How dangerous 
mud it have been for the fovereign to attempt 
to punifh a clergyman for any crime whatever, if 
his order were difpofed to protect him, and' 
to reprefent either the proof as infufficient for 
convicting fo holy a man, or the punimment as 
too feyere to be inflicted upon one whofe perfon 
had been rendered facred by religion? The ^fo- 
vereign could, in fuch circumftances, do no 
Better than leave him to be tried by the eccle- 
fiaftical courts, who. for the honour of their own 
order, were interefted to reftrain, as much as 
poflible, every member of it from committing 
enormous crimes, or even from giving occafion 
to fuch grofs fcandal as might difgufl the minds 
of the people. 

IN the ftate in which things were through the 
greater part of Europe during the tenth, eleventh, 
twelfth, and thirteenth centuries, and for fome 
time both before and after that period, the con- 
ftitution of the church of Rome may be con- 
Jidered as the moil formidable combination that 
ever was formed againft the authority and fecurity 
of civil government, as well as againfl the li- 
berty, reafon, and happinefs of mankind, which 
can flourifh only where civil government is able 
o protect them. In that constitution the groffeft 

delations 



r* THE NATURE AND CAUSES OF 

O OK delufions of fuperflition were fupported in fuch a 
manner by the private intereits of fo great a 
number of people as put them out of all danger 
from any ailault of human reafon ; becaufe though 
human reafon might perhaps have been able to 
unveil, even to the eyes of the common people, 
ibme of the delufions of fuperitition, it could 
never have diffolved the ties of private intereft. 
Had this conftitution been attacked by no other 
enemies but the feeble efforts of human reafon, it 
mud have endured for ever. But that immenfe 
and well-built fabric, which all the wifdom and 
virtue of man could never have fhaken, much lefs 
have overturned, was by the natural courfe of 
things, fait weakened, and afterwards in part 
deftroyed, and is now likely, in the courfe of a 
few centuries more, perhaps^ to crumble into 
ruins altogether. 

THE gradual improvements of arts, manufac- 
tures, and commerce, the fame cauies which 
deftroyed the power of the great barons, deftroyed, 
in the fame manner, through the greater part of 
Europe, the whole temporal power of the clergy, 
In the produce of arts, manufactures, .and com- 
merce, the clergy, like the great barons, found 
fomething for which they cauld exchange their 
rude produce, and thereby difcovered the means 
cf Ipending their whole revenues upon their own 
perfons without giving any confiderable fhare of 
them to other people. Their chanty became 
gradually lefs extenfive, their hofpitaluy lefs 
liberal or lefs profufe. Their retainers became 
confequently lefs numerous, and by degrees 

dwindled 



THE WEALTH OP NATIONS. 219 

dwindled away altogether. The clergy too, like CHAP. 
the great barons, wifhed to get a better rent from 
their landed eftates, in order to fpend it, in the 
feme manner, upon the gratification of their own 
private vanity and folly. But this increafe of 
rent could be got only by granting leafes to their 
tenants, who thereby became in a great meafure 
independent of them. The ties of intereft, which 
bound the inferior ranks of people to the clergy, 
were in this manner gradually broken and dif- 
folved. Tney were even broken and diilblved 
fooner than thofe which bound the fame ranks 
of people to the great barons : becaufe the bene- 
fices of the church being, the greater part of 
them, much fmaller than the eftates of the great 
barons, the pofTefibr of each benefice was much 
fooner able to fpend the whole of its revenue upon 
his own perfon. During the greater part of the 
fourteenth and fifteenth centuries, the power of 
the great barons was, through the greater part of 
Europe, in full vigour. But the temporal power 
of the clergy, the abfolute command which they 
had once had over the great body of the people, 
was very much decayed. The power of the 
church was by that time very nearly reduced 
through the greater part of Europe to what arofe 
from her fpiritual authority ; and even that fpi- 
ritual authority was much weakened when it 
ceafed to be fupportcd by the chanty and hofpita- 
lity of the clergy. The inferior ranks of people 
no longer looked upon that order, as they had 
done before, as the comforters of their diftrefs, 
and the relievers of their indigence. On the 

contrary, 



220 THE NATURE AND CAUSES OF 

BOOK contrary, they were provoked and difgufred by 
the vanity, luxury, and expence of the richer 
clergy, who appeared to fpend upon their own 
pleafures what had always before been regarded 
as the patrimony of the poor. 

IN this iituation of things, the fovereigns in 
the different ftates of Europe endeavoured to re* 
cover the influence which they had once had in 
the difpofal of the great benefices of the church, 
by procuring to the deans and chapters of each 
diocefe the restoration of ' their ancient right of 
electing the bifhop, and to the monks of each 
abbacy that of electing the abbot. The re-efta- 
blifhing of this ancient order was the object of 
feveral ftatutes enacted in England during the 
courfe of the fourteenth century, particularly of 
what is<> called the ftatute of provifors ; and of the 
Pragmatic fanction eftablifhed in France in the 
fifteenth century. In order to render the election 
valid, it was necerTary that the fovereign fhould 
both confent to it before-hand, and afterwards ap- 
prove of the perfon elected ; and though the 
election was ftill fuppofed to be free, he had, 
however, all the indirect means which his fitua- 
tion neceflarily afforded him, of influencing the 
clergy in his own dominions. Other regulations 
of a fimilar tendency were eftablifhed in other 
parts of Europe. But the power of the pope in 
the collation of the great benefices of the church 
feems, before the . reformation, to have been no 
\vere fo effectually and fo univerfally retrained 
as in France and England. The Concordat 
afterwards, in the iixteenth century, gave to the 

kings 



THE WEALTH OF NATIONS; 221 

kings of France the abfolute right of preferring CHAP. 
to all the great, or what are called the confiftorial 
benefices of the Galilean church. 

SINCE the . eftablifhment of the Pragmatic 
fan&ion and of the Concordat, the clergy of 
France have in general fhown let's refpect to the 
decrees of the papal court than the clergy of any 
other catholic country. In all the difputes which 
their fovereign has had with the pope, they have 
almoft conftantly taken part with the former. 
This independency of the clergy of France upon 
the court of Rome, feems to be principally 
founded upon the Pragmatic function and the 
Concordat. In the earlier periods of the mo- 
narchy, the clergy of France appear to have been 
as much devoted to the pope as thofe of any other 
country. When Robert, the fecond prince of 
the Capetian race, was moft unjuftly excommu- 
nicated by. the court of Rome, his own fervants, 
it is faid, threw the victuals which came from his 
table to the dogs, and refufed to tafte any thing 
themfclves which had been polluted by the contact 
of a perfon in his ficuation. They were taught to 
do fo, it may very fafely be prefumed, by the 
clergy of his own dominions. 

THE claim of collating to the great benefices 
of the church, a claim in defence of which the 
court of Rome had frequently fhaken, and fome- 
times overturned the thrones of fome of the 
greateft fovercigns in Chriftendom, was in this 
manner either retrained or modified, or given 
up altogether, in many different parts of Europe, 
even before the time of the reformation. As the 

clergy 



222 THE NATURE AM) CAUSES OF 

BOOK clergy had now no lefs influence over the people, fo 
the ftate had more influence over the clergy. 
The clergy therefore had both lefs power and lefs 
inclination to difturb the (late. 

THE authority of the church of Rome was 1 in 
this ftate of declenfion, when the difputes which 
gave birth to the reformation began in Germany, 
iind foon fpread themfelves through every part of 
Europe. The new doctrines were every where 
received with a high, degree of popular favour. 
They were propagated with all that enthufiaftic 
zeal which commonly animates the fpirit of party, 
when it attacks eftablifhed authority. The 
teachers of thofe doctrines, though perhaps in 
other refpects not more learned than many of the 
divines who defended the eftablifhed church^ 
feem in general to have been better acquainted 
with ecclefiaftical hiftory, and with the origin and 
progrefs of that fyflem of opinions upon which 
the authority of the church was eftablifhed,, and 
they had thereby fonie advantage in almoft every 
difpute. The aufterity of their manners gave 
them authority with the common people, who 
contrafted the ftrict regularity of their conduct 
with the diforderly lives of the greater part of 
their own clergy. They poffeffed too, in a much 
higher degree than their adverfaries, all the arcs 
of popularity and . of gaining profelytes, arts 
which the lofty and dignified fons of the church 
had long negle&ed, as being to them in a great 
meafure ufelefs. The reafon of the new doctrines 
recommended them to fome, their novelty to 
many j the hatred and contempt of the eftablifhed 

clergy 



THE WEALTH OF NATIONS. 22$ 

dergy to a ftill greater number : but the zealous, CHAP. 
pailionate, and fanatical, though frequently coarfe 
and ruttic, eloquence with which they were almoft 
every where inculcated, recommended them to by 
far the greateft number. 

THE fuccefs of the new dolrines was almoft 
every where fo great, that the princes who at that 
time happened to be on bad terms with the court 
of Rome, were by means of them eafily enabled, 
in their own dominions, to overturn the church, 
which, having loft the refpect and veneration of 
the inferior ranks of people, could make fcarce 
any refiftance. The court of Rome had difo- 
obliged fome of the fmaller princes in the northern 
parts of Germany, whom it had probably confi- 
dered as too infignificant to be worth the ma- 
naging. They univerfally, therefore, eftablifhed 
the reformation in their own dominions. The 
tyranny of Chriftiern II. and of Troll archbifhop 
of Upfal, enabled Guftavus Vafa to expel them 
both from Sweden. T'he pope favoured the 
tyrant and the archbifhop, and Guftavus Vafa 
found no difficulty in eftabli filing the reformation- 
rn Sweden. Chriftiern If, was afterwards de- 
pofed from the throne of Denmark, where his 
eondudi: had rendered him as odious as in Sweden. 
The pope, however, was ftill difpofsd to favour 
him, and Frederic of Holftein, who had mount- 
ed the throne in his ftead, revenged himfelf 
by following the example of Guftavus Vafa. 
The magiftrates of Bferne and Zurich, who had 
no particular quarrel with the pope, eftablifned 
with great eafe the reformation in their refpeclive 

cantons., 



224 TtiE NATtTRtf AND CAUSES >F 

3 o o K cantons, where juft before fome of the clergy had; 
by an impoflure fomewhat groffer than ordinary, 
rendered the whole order both odious arid con- 
temptible. 

IN this critical fituation of its affairs, the papal 
court was at fufHcient pains to cultivate the 
friendfhip of the powerful fovereigns of France 
and Spain, of whom the latter was at that time 
emperor of Germany. With their affiftance it 
was enabled, though not without great difficulty 
and much bloodfhed, either to jfiipprefs altoge- 
ther, or to obftrucl: very much, the progrefs of the 
reformation in their dominions. It was well 
enough inclined too to be complaifant to the 
king of England. But from the circum fiances 
of the times, it could not be fo without giving 
offence to a dill greater fovereign, Charles V; 
king of Spain and emperor of Germany. Henry 
VIII. accordingly, though he did not embrace 
himfelf the greater part of the doftrines of the 
reformation, was -yet enabled, by their general 
prevalence, to fupprefs all the monafteries, and to 
abolifh the authority of the church of Rome in his 
dominions. That he fhould go fo far, though he 
went no further, gave fome ilitis faction to the pa^ 
trons of the reformation, who having got pofTeflioii 
of the government in the reign of his fon and fuc- 
ceflbr, completed without any difficulty the work 
v/hich Henry VIIL had begun. 

IN fome countries, as in Scotland, where the 
government was weak, unpopular, and not very 
iirmly eftablifhed, the reformation was ftrong 
enough to overturn, not only the church, but 

the 



THE WEALTH OF NATIONS. 225 

the.ftate likewife for attempting to fupport the eH T Ap, 
church. 

AMONG the followers of the reformation, dif- 
perfed in all the different countries of Europe, 
there was no general tribunal, which, like that of 
the court of Rome, or an oecumenical council, 
could fettle all difputes among them, and witli 
irrefiftible authority prefcribe to all of them the 
precife limits of orthodoxy. When the followers 
of the reformation in one country, therefore, hap- 
pened to differ from their brethren in another, 
as they had no common judge to appeal to, the 
difpute could never be decided ; and many fucfi 
difputes arofe among them. Thofe concerning 
the government of the church, and the right of 
conferring ecclefiaflical benefices, were perhaps 
the mod interefting to the peace and welfare of 
civil fociety. They gave birth accordingly to the 
two principal parties or feds among the followers 
of the reformation, the Lutheran and Calviniflic 
feds, the only feels among them, of which the 
doctrine and difcipline have ever yet been efta- 
blifhed by law in any part of Europe* 

THE followers of Luther, together with what 
is called the church of England, preferved more 
or Icfs of the epifcopal government, eftablifhed 
fubordination among the clergy, gave the fove- 
reign the difpofal of all the bifhoprics, and 
other confiflorial benefices within his dominions, 
and thereby rendered him the real head of the 
church ; and without depriving the bifhop of the 
right of collating to the fmaller benefices within 
fcis diocefe, they, even to thofe benefices, not 

VOL. lit. <^ only 




226 , THE NATURE AND CAUSES OF 

BOOK only admitted, but favoured the right of prefent- 
" ation both in the fovereign and in all other lay* 
patrons. This fyftem of church government was 
from the beginning favourable to peace and good 
order, and to fubmiflion to the civil , fovereign. 
It has never, accordingly, been the occafion of 
any tumult or civil commotion in any country in 
which it has once been eftablifhed. The church 
of England in particular has always valued her- 
felf, with great reafon, upon the unexceptionable 
loyalty of her principles. Under fuch a govern- 
ment the clergy naturally endeavour to recom- 
mend themfelves to the fovereign, to the court, 
and to the nobility and gentry of the country, 
by whofe influence they chiefly expect to obtain 
preferment. They pay court to thofe patrons, 
fometimes, no doubt, by the vileft flattery and 
afientation, but frequently too by cultivating all 
thofe arts which bed deferve, and which are 
therefore moft likely to gain them the efteem of 
people of rank and fortune ; by their knowledge 
in all the different branches of ufeful and orna- 
mental learning, by the decent liberality of their 
manners, by the focial good humour of their 
converfation, and by their avowed contempt of 
thofe abfurd and hypocritical aufterities which 
fanatics inculcate and pretend to pratife, in or- 
der to draw upon themfelves the veneration, and 
upon the greater part of men of rank and for 
tune, who avow that they do not praclife them, 
the abhorrence of the common people. Such a 
clergy, however, while they pay their court in 
this manner to the higher ranks of life, are ver^ 

apt 



THE WEALTH OF NATIONS. 227 

apt to neglect altogether the means of maintaining c H j A p * 
their influence and authority with the lower. They 
are liftened to, efleemed and refpected by their 
fuperiors ; but before their inferiors they are fre- 
quently inrapable of defending, effectually and to 
the conviction of fuch hearers, their own foberand 
moderate doctrines againfl the mod ignorant en- 
thufiafl who chufes to attack them. 

THE followers of Zuinglius, or more properly 
thofe of Calvin, on the contrary, beftowed upon 
the people of each parifh, whenever the church 
became vacant, the right of electing their owri 
paftor ; and eftablifhed at the fame time the moft 
perfect equality among the clergy. The former 
part of this inflitution, as long as it remained in 
vigour, feems to have been productive of nothing 
but diforder and confufion, and to have tended 
equally to corrupt the morals both of the clergy 
and of the people. The latter part feems never 
to have had any effects but what were perfectly 
agreeable. 

As long as the people of each parifh preferved 
the right of electing their own paftors, they acted 
almoft always under the influence of the clergy, 
and generally of the moft factious and fanatical 
of the order. The clergy, in order to preferve 
their influence in thofe popular elections, be- 
came, or affected to become, many of them, -fa- 
natics themfelves, encouraged fanaticifm among 
the people, and gave the preference almoft al- 
ways to the rnoft fanatical candidate. So fmali 
a matter as the appointment of a parifli prieit 
occafioned almoft always a violent contefl, not 

o 2 only 



223 THE NATURE AND CAUSES OF 

BOOK O fliy m one parifh, but in all the neighbouring- 
parifhes, who feldom failed to take part in the 
quarrel. When the parifh happened to be fitu- 
ated in a great city, it divided all the inhabitants 
into two parties; and when that city happened 
either to conflitute itfelf a little republic, or to 
be the head and capital of a little republic, as 
is the cafe with many of the confidersble cities 
in Switzerland and Holland, every paltry difpute 
of this kind, over and above exafperatirig the 
animofity of all their other factions, threatened 
to leave behind it both a new fchifm in the 
church, and a new fadion in the (late. In thofe 
fmall republics, therefore, the magiftrate very 
foon found it neceflary, for the fake of preferv- 
ing the public peace, to affume to himfelf the 
right of prefenting to all vacant benefices. In 
Scotland, the moft extenfive country in which 
this prefbyterian form of church government 
has ever been eftablifhed, the rights of patronage 
were in effect abolifhed by the act which efla- 
blifhed prefbytery in the beginning of the reign 
of William III. That act at lead put it in the 
power of certain clafles of people in each parifh, 
to purchafe, for a very fmall price, the right of 
electing their own paftor. The conftitution 
tyhich this act eftablifhed was allowed to uibfifl 
for about two and twenty years, but was abolifh- 
ed by the loth of queen Anne, ch. 12. on ac* 
count of the confufions and diforders which this 
more popular mode of election had almoft every 
where occafioned. In fo extenfive a country as 
Scotland, however, a tumult in a remote parifh was 

not 



THE WEALTH OF NATIONS. 229 

not fo likely to give disturbance to government CHAP, 
as in a fmaller ftate. The xoth of queen Anne 
reftored the rights of patronage. But though 
in Scotland , the law gives the benefice without 
any exception to the perfon prefented by the par 
tron ; yet the church requires fometimes (for me 
has not in this refpect been very uniform in her 
decifions) a certain concurrence of the people, 
before fhe will confer upon the prefentee what 
is called the cure of fouls, or the ecclefiaftical 
jurifdiction in the parifh. She fometimes at leaft, 
from an affected concern for the peace of the pa- 
rifh, delays the fettlement till this concurrence 
can be procured. The private tampering of fome 
of the neighbouring clergy, fometimes to procure, 
but more frequently to prevent this concurrence, 
and the popular arts which they cultivate in order 
to enable them 'upon fuch occafions to tamper 
more effectually, are perhaps the caufes which 
principally keep up whatever remains of the old 
fanatical fpirit, either in the clergy or in the people 
of Scotland. 

THE equality which the prefbyterian form of 
church government eftablifh.es among the clergy, 
confifts, firft, in the equality of authority or ec- 
clefiafticai jurifdiction ; and, fecondly, in the 
equality of benefice. In all pyefbyterian churches 
the equality of authority is perfect : that of be- 
nefice is not fo. The difference, however, be- 
tween one benefice and another, is feldom fq 
confiderable as commonly to tempt the poffeffor 
even of the fmall one to pay court to his patron, 
by the vile arts of flattery and affentation, in, 
Q_ 3 order 




THE NATURE AND CAUSES OF 

order to get a better. In all the prefbyterian 
churches, where the rights of patronage are tho- 
roughly eftablifhed, it is by nobler and better 
arts that the eftablifhed clergy in general endea- 
vour to gain the favour of their fuperiors ; by 
their learning, by the irreproachable regularity of 
their life, and by the faithful and diligent difcharge 
of their duty. Their patrons even frequently com- 
plain of the independency of their fpjrit, which 
they are apt to conftrue into ingratitude for pad 
favours, but which at worft, perhaps, is feldom 
any more than that indifference which naturally 
arifes from the confcioufnefs that no further fa- 
vours of the kind are ever to be expected. There 
is fcarce perhaps to be found any where in Europe 
a more learned, decent, independent, and refpecT> 
able fet of men, than the greater part of the pref? 
byterian clergy of Holland, Geneva, Switzerland, 
and Scotland. 

WHERE the church benefices are all nearly 
equal, none of them can be very great, and this 
mediocrity of benefice, though it may no doubt 
t>e carried too far, has, however, fome very agree-? 
able effects. Nothing but the moft exemplary 
morals can give dignity to a ma.n of fmall for- 
tune. The vices of levity and vanity necefTarily 
render him ridiculous, and are, befides, almofl as 
ruinous to him as they are to the common people, 
In his own conduct, therefore, he is obliged to 
follow that fyftem of morals which the common 
people refped the mofl. He gains their efteem 
and affection by that plan of life which his own 
intereft and fituation would lead him. to follow. 

The 



THE WEALTH OF NATIONS. 231 

Tne common people look upon him with that CHAP. 
kindnefs with which we naturally regard one who 
approaches fomewhat to our own condition, but 
who, we think, ought to be in a higher. Their 
kindnefs naturally provokes his kindnefs. He 
becomes careful to inflrucl them, and attentive 
to aflift and relieve them. He does not even 
defpife the prejudices of people who are difpofed 
to be fo favourable to him, and never treats them 
with thofe contemptuous and arrogant airs which 
we fo often meet with in the proud dignitaries of 
opulent and well-endowed churches. The pref- 
byterian clergy, accordingly, have more influence 
over the minds of the common people than per- 
haps the clergy of any other eftablifhed church. 
It is accordingly in prefbyterian countries only 
that we ever find the common people converted, 
without periecution, completely, and almoft to a 
man, to the eftablifhed church. 

IN countries where church benefices are the 
greater part of them very moderate, a chair in a 
univerfity is generally a better eftablifhment than 
a church benefice. The univerfities have, in this 
cafe, the picking and chufing of their members 
from all the churchmen of the country, who, in 
every country, conftitute by far the moft nume- 
rous clafs of men of letters. Where church be- 
nefices, on the contrary, are many of them very 
confiderable, the church naturally draws from 
the univerfities the greater part of their eminent 
men of letters ; who generally find fome patron 
who does himfelf honour by procuring them 
church preferment. In the former fituation we 

arc 



23* THE NATURE AND CAUSES OF 

BOOK are likely to find the univerfities filled with the 
moft eminent men of letters that are to be found 
in the country. In the latter we are likely to 
find few eminent men among them, and thofe 
few among the youngeft members of the fociety, 
who are likely too to be drained away from it, 
before they can have acquired experience and 
knowledge enough to be of much tife to it. It 
is obferved by Mr. de Voltaire, that father Porree, 
a jefuit of no great eminence in the republic of 
letters, was the only profefibr they had ever Jiad 
in France whofe works were worth the reading. 
In a country which has produced fo many emi- 
nent men of letters, it mud appear fomewhat fin- 
gular that fcarce one of them mould have been a 
.profeifor in a univerfity. The famous CaiTendi 
\vas, in the beginning of his life, a profeflbr in 
the univerfity of Aix. Upon the firfl dawning 
of his genius, it was reprefented to him, that by 
going into the church he could eafily find a much 
more quiet and comfortable fubfiflence, as well 
as a batter fituation for purfuing his fludies j and 
he immediately followed the advice. The ob- 
fervation of Mr. de Voltaire may be applied, I 
believe, not only to France, but to all other 
Roman catholic countries. We very rarely find 
in any of them, an eminent man of letters who 
is a profeflbr in a uniyerfity, except, perhaps, 
in the profeflipns of law and ,phyfic ; profeflions 
from which the church is not fo likely to draw 
them. After the church of Rome, that of Eng- 
land is by far the richefl and befl endowed 
church in Chriftendom. In Engjand,- accord- 



THE WEALTH OF NATIONS. 133 

ingly, the church is continually draining the CHAP. 
univerfities of all their bed and ableft members ; 
and an old college tutor, who is known and dif- 
tinguifhed in Europe as an eminent man of let- 
ters, is as rarely to be found there as in any Ro- 
man catholic country. In Geneva, on the con- 
trary, in the proteftant cantons of Switzerland, 
in the proteftant countries of Germany, in Hol- 
land, in Scotland, in Sweden, and Denmark, the 
mod eminent men of letters whom thofe coun- 
tries have produced, have, not all indeed, but the 
far greater part of them, been profeffbrs in uni- 
verfities. In thofe countries the univerfities are 
continually draining the church of all its mod 
eminent men of letters. 

IT may, perhaps, be worth while to remark, 
that, if we except the poets, a few orators, and 
a few hiflorians, the far greater part of the other 
eminent men of letters, both of Greece and 
Rome, appear to have been either public or pri- 
vate teachers ; generally either of philofophy or 
of rhetoric. This remark will be found to hold 
true from the days of Lyfias and Ifocrates, 
of Piato and Ariftotle, down to thofe of Plu- 
tarch and Epi&etus, of Suetonius and Quinti- 
lian. To impofe upon any man the neceffity of 
teaching, year after year, in any particular branch 
of fcience, feems, in reality, to be the mod: ef- 
fectual method for rendering him completely 
mailer of it himfelf. By being obliged to go 
every year over the fame ground, if he is good 
for any thing, he necelTarily becomes, in a few 
years, well acquainted with every part of it ; and 

if 




334 . THE NATURE AND CAUSES OF 

j o O K if upon any particular point he fhould form too 
m ^l^j hafty an opinion one year, when he comes in the 
courfe of his lectures to re-confider the fame 
fubjeft the year thereafter, he is very likely to 
correct it. As to be a teacher of fcience is cer- 
tainly the natural employment of a mere man of 
letters j fo is it likewife, perhaps, the education 
which is moft likely to render him a man -of folid 
learning and knowledge. The mediocrity of 
church benefices naturally tends to draw the 
greater part of men of letters in the country 
where it takes place, to the employment in which 
they can be the mod ufeful to the public, and, at 
the fame time, to give them the bed education, per- 
haps, they are capable of receiving. It tends to 
render their learning both as folid as poflible, and 
as ufeful as poflible. 

THE revenue of every eftablifhed church, fuch 
parts of it excepted as may arife from particular 
lands or manors, is a branch, it ought to be 
obferved, of the general revenue of the ftate, 
which is thus diverted to a purpofe very differ- 
ent from the defence of the ftate. The tythe, 
for example, is a real land-tax, which puts it 
, out of the power of the proprietors of land to 
contribute fo largely towards the defence of the 
ftate as they otherwife might be able to do. The 
rent of land, however, is, according to fome, the 
fole fund, and, according to others, the princN 
pal fund, from which, in all great monarchies, 
the exigencies of the ftate muft be ultimately 
fupplied. The more of this fund that is given 
to the church, the lefs, it is evident, can be 

fpared 



THE WEALTH OF NATIONS. 235 

fpared to the ftate. It may be laid down as a CHAP. 
certain maxim, that, all other things being fup- 
pofed equal, the richer the church, the poorer muft 
neceffarily be, either the fovereign on the one 
hand, or the people on the other; and, in all 
cafes, the lefs able mud the ftate be to defend 
itfelf. In feveral proteftant countries, particu- 
larly in all the proteftant cantons of Switzerland, 
the revenue which anciently belonged to the 
Roman catholic church, the tythes and church 
lands, has been found a fund fufficient, not only 
to afford competent falaries to the eftablimed 
clergy, but to defray, with little or no addition, 
all the other expences of the ftate. The magi- 
ftrates of the powerful canton of Berne, in par- 
ticular, have accumulated out of the favings 
from this fund a very large fum, fuppofed to 
amount to feveral millions, part of which is de- 
pofited in a public treafure, and part is placed 
at intereft in what are called the public funds 
of the different indebted nations of Europe; 
chiefly in thofe of France and Great Britain. 
What may be the amount of the whole expence 
which the church, either of Berne, or of any 
other proteftant canton, cofts the ftate, I do not 
pretend to know. By a very exaft account it 
appears, that, in 1755, the whole revenue of the 
clergy of the church of Scotland, including their 
glebe or church lands, and the rent of their 
manfes or dwelling-houfes, eftimated according 
to a reafonable valuation, amounted only to 
68,514!, is. 5d. T \ This very moderate re- 
venge 



23 6 THE NATURE AND CAUSES OF 

B O O K venue affords a decent fub'iflence to nine hun- 
dred and forty-four minifters. The whole ex- 
pence of the church, including what is occafion- 
ally .laid out for the building and reparation of 
churches, and of the manfes of minifters, cannot 
well be fuppofed to exceed eighty or eighty-five 
thoufand pounds a-year. The mod opulent 
church in Chriftendoin does not maintain better 
the uniformity of faith, the fervour of devotion, 
the fpirit of order, regularity, and auftere morals 
in the great body of the people, than this very 
poorly' endowed church of Scotland. All the 
good effects, both civil and religious, which an 
eftablifhed church can be fuppofed to produce, 
are produced by it as completely as by any other. 
The greater part of the proteftant churches of 
Switzerland, which in general are not better en- 
dowed than the church of Scotland, produce 
thofe effects in a ftill higher degree. In the 
greater part of the proteilant cantons, there i? 
not a fingle perfon to be found who does not 
proiefs himfelf to be of the eftablifhed church, 
Jf he profeffes himfelf to be of any other, in- 
deed, the law obliges him to leave the canton. 
But fo fevere, or rather indeed fo oppreflive a 
law, could never have been executed in fuch free 
countries, had not the diligence of the clergy 
before-hand converted to the eftablifhed church 
the whole body of the people, with the excep- 
tion of, perhaps, a few individuals only. In 
fome parts of Switzerland, accordingly, where, 
from the accidental union of a prateftant and 

Roman 



THE WEALTH OF NATIONS. 

Roman catholic country, the converfion has not CHAP. 
been fo complete, both religions are not only to- 
lerated but eftablifhed by law. 

THE proper performance of every fervice 
feems to require that its pay or recompence 
fhould be," as exactly as poflible, proportioned 
to the nature of the fervice. If any fervice is 
very much under-paid, it is very apt to fuffer 
by the meannefs and incapacity of the greater 
part of thofe who are employed in it. If it is 
very much over-paid, it is apt to fuffer, perhaps, 
ftill more by their negligence and idlenefs. A 
man of a large revenue, whatever may be his 
profeffion, thinks he ought to live like other men 
of large revenues ; and to fpend a great part of 
his time in feftivity, in vanity, and in diflipa- 
tion. But in a clergyman this train of life not 
only confumes the time which ought to be em- 
ployed in the duties of his function, but in the 
eyes of the common people deftroys almoft en- 
tirely that fanctity of character which can alone 
enable him to perform thofe duties with proper 
weight and authority. 

PART IV. 

Of the Expcnce cf f importing ike Dignity of tLs 
Sovereign. 



and above the expenccs neceffary for 
enabling the ibvereign to perform his feve- 
ral duties, a certain expence is requifite for the 
fupport of his dignity. This expence varies 
i botti 



238 THE NATURE AND CAUSES Of 

BOOK both with the different periods of improvement^ 
and with the different forms of government. 

IN an opulent and improved fociety, where all 
the different orders of people are growing every 
day more expenfive in their houfes, in their fur- 
niture, in their tables, in their drefs, and in their 
equipage ; it cannot well be expe&ed that the 
fovereign mould alone hold out againft the fa- 
fhion. He naturally, therefore, or rather necef- 
farily, becomes more expenfive in all thofe dif- 
ferent articles too. His dignity even feems to re- 
quire that he mould become fo. 

As in point of dignity, a monarch is more 
raifed above his fubjects than the chief magi- 
ftrate of any republic is ever fuppofed to b<* 
above his fellow-citizens ; fo a greater expence 
is neceffary for fupporting that higher dignity. 
We naturally expect more fplendor in the court 
of a king, than in the manlion-houfe of a doge or 
burgo-mafler. 

k 

CONCLUSION* 

THE expence of defending the fociety, arid 
that of fupporting the dignity of the chief ma- 
giflrate, are both laid out for the general benefit 
of the whole fociety. It is reafonable, there- 
fore, that they fhould be defrayed by the gene- 
ral contribution of the whole fociety, all the dif- 
ferent members contributing, as nearly as poffible> 
in proportion to their refpective abilities* 

THE expence of the adminiftration of juftice 
too, may, no doubt, be confidered as laid out for 
the benefit of the whole fociety. There is no 
5 



THE WEALTH OF NATIONS. 139 

~ 
impropriety, therefore, in its being defrayed by C H A p. 

the general contribution of the whole fociety. 
The perfons however, who give occafion to this 
expence are thofe who, by their injuftice in one 
way or another, make it neceflary to feek redrefs 
or protection from the courts of juftice. The 
perfons again molt immediately benefited by this 
expence, are thofe whom the courts of juftice 
either reftore to their rights, or maintain in their 
rights. The expence of the adminiflration of 
juftice, therefore, may very properly be defrayed 
by the particular contribution of one or other, 
or both of thofe two different fets of perfons, ac- 
cording' as different occafions may require, that 
is, by the fees of court. It cannot be neceflary 
to have recourfe to the general contribution of 
the whole fociety, except for the convidtion of 
thofe criminals who have not themfelves any 
jeftate or fund fufficient for paying thole fees. 

THOSE local or provincial expences of which 
the benefit is local or provincial (what is laid 
out, for example, upon the police of a particular 
town or diftrict), ought to be defrayed by a local 
or provincial revenue, and ought to be no bur- 
den upon the general revenue of the fociety. It is 
unjuft that the whole fociety fhould contribute to- 
wards an expence of which the benefit is confined 
to a part of the fociety. 

THE expence of maintaining good roads and 
communications is, no doubt, beneficial to the 
whole fociety, and may, therefore, without any 
injuflice, be defrayed by the general contribu- 
tion 



THE NATURE AND CAUSES OF 
BOOK tion of the whole fociety. This expenee, how- 
ever, is moft immediately and directly beneficial 
to thofe who travel or carry goods from one 
place to another, and to thofe who confume fuch 
goods. The turnpike tolls in England, and the 
duties called peages in other countries, lay it al- 
together upon thofe two different fets of people, 
and thereby difcharge the general revenue of the 
fociety from a very confiderable burden. 

THE expence of the inftitutions for education 
and religious inftru&ion, is likewife, no doubt, 
beneficial to the whole fociety, and may, there- 
fore, without injufiice, be defrayed by the gene- 
ral contribution of the whole fociety. This ex- 
pence, however, might perhaps with equal pro- 
priety, and even with fome advantage, be de- 
frayed altogether by thofe who receive the im- 
mediate benefit of fuch education and inflruc- 
tion, or by the voluntary contribution of thofe 
who think they have occafion for either the one 
or the other. 

WHEN the inflitutions or public works which 
are beneficial to the whole fociety, either cannot 
be maintained altogether, or are not maintained 
altogether by the contribution of fuch particular 
members of the fociety as are moft immediately 
benefited by them, the deficiency mufl in moft 
cafes be made up by the general contribution of 
the whole fociety. The general revenue of the 
fociety, over and above defraying the expence of 
defending the fociety, and of fupporting the dig- 
nity of the chief magiftratc, mult make up for 

the 



THE WEALTH OF NATIONS. 241 

the deficiency of many particular branches of CHAP, 
revenue. The fources of this general or public 
revenue, I (hall endeavour to explain in the follow- 
ing chapter. 



CHAP. II. 

Of the Sources of the general or public Revenue of 
the Society. 

HE revenue which muft defray, not only 
the ex pence of defending the fociety and 
of fupporting the dignity of the chief magiftrate, 
but all the other neceflary expences of govern- 
ment, for which the conflitution ' of the flate has 
not provided any particular revenue, may be 
drawn, either, firfr, from fome fund which pecu- 
liarly belongs to the fovereign or commonwealth, 
and which is independent of the revenue of the 
people ; or, fecondly, from the revenue of the 
people. 

PART I. 

Of the Funds or Sources of Revenue . which may pe- 
culiarly belong to the Sovereign or Commonwealth. 

HP HE funds or fources of revenue which may , 

peculiarly belong to the fovereign or com- 
monwealth muft confift, either in flock, or in 
)and. 

VOL. in. R THE 



*** THE NATURE AND CAUSES OF 

BOOK THE fovereign, like any other owner of ftock^ 
may derive a revenue from it; either by employing 
it himfelf, or by lending it. His revenue is in the 
one cafe profit, in the other intereft. 

THE revenue of a Tartar or Arabian chief con^ 
lifts in profit. It arifes principally from the milk 
and increafe of his own -herds arid flocks, of which 
he himfelf fuperintends the management, and is the 
principal mepherd or herdfman of his own horde 
or tribe. It is, however, in this earlieft and rudeft 
ftatq of civil government only that profit has ever 
made the principal part of the public revenue of a 
monarchical it ate.. 

SMALL republics have fometimes derived a 
confiderable revenue from the profit of mercan- 
tile projects. The republic of Hamburgh is 
faid to do fo from the profits of a public wine 
cellar and apothecary's mop *. The ftate cannot 
be very great of which the fovereign has leifure 
to carry on the trade of a wine merchant or apo- 
. thecary. The profit of a public bank has been, 
a fource of revenue to more confiderable itates. 
It has been fo not only to Hamburgh, but to 

* See Memoires concernant les Droits & Impofitions en Eu- 
rope ; tome i. page 73. This work was compiled by the order 
of the court for the ufe of a commiflion employed for fome years 
paft in confidently the proper means for reforming the finances 
of France. The > xount of the French taxes, which takes up 
three volumes in quarto, may be regarded as perfectly authen- 
tic. That of thofe of other European nations was compiled 
from fuch informations as the Ficncl. remitters at the different 
courts could procvne. It is much fhorter, and probably not 
quite fo exad as that of the French taxes. 

Venice 



THE WEALTH OF NATIONS. . 243 

Venice and Amfterdam. A revenue of this kind c H A p. 
has even by fome people been thought not below 
the attention of fo great an empire as that of 
Great Britain. Reckoning the ordinary di- 
vidend of the bank of England at five and a half 
per cent, and its capital at ten millions feven 
hundred and eighty thoufand pounds, the neat 
annual profit, after paying the expenr.e of /na- 
nagement, mud amount, it is faid, to five hun- 
dred and ninety-two thoufand nine hundred 
pounds. Government, it is pretended, could 
borrow this capital at three per cent, intereft, 
and by taking the management of the bank into 
its own hands, might make a clear profit of two 
hundred and lixty-nine thoufand five hundred 
pounds a-year. The orderly, vigilant, and par- 
fimonious adminiftration of fuch ariflrocracies as 
thofe of Venice and Amsterdam, is extremely 
proper, it appears from experience, for the ma- 
nagement of a mercantile project of this kind. 
But whether fuch a government as that of Eng- 
land ; which, whatever may be its virtues, has 
never been famous for good ceconomy ; which, 
in time of peace, has generally conducted itfelf 
with the ilothful and negligent profufion that is 
perhaps natural to monarchies ; and in time of 
war has conftantly acted with all the thoughtlefs 
extravagance that democracies are apt to fall into ; 
could be fafely trufted with the management of 
fuch a project, mud at leafl be a good deal more 
doubtful. 

THE pofl-office is properly a mercantile pro- 
The government advances the expence of 
R 2 eftablifhing 



THE NATURE AND CAUSES OF 
BOOK eftablifhing the different offices, and of buying or 
'_ . hiring the neceffary horfes or carriages, and is 
repaid with a large profit by the duties upon what 
is carried. It is perhaps the only mercantile pro- 
ject which has been fuccefsfully managed by, I 
believe, every fort of government. The capital 
to be advanced is not very confiderable. There is 
no myftery in the bufinefs. The returns are not 
only certain, but immediate. 

PRINCES, however, have frequently engaged 
In many other mercantile projects, and have 
been willing, like private perfons, to mend their 
fortunes by becoming adventurers in the com* 
mon branches of trade. They have fcarce ever 
fucceeded. The profufion with which the af- 
fairs of princes are always managed, renders it 
almofl impoflible that they mould. The agents 
of a prince regard the wealth of their mafter as 
mexhauflible ; are carelefs at what price they 
buy ; are carelefs at what price they fell ; are 
carelefs at what expence they tranfport his goods 
from one place to another. Thofe agents fre- 
quently live with the profufion of princes, and 
fometimcs too, in fpite of that profufion, and by 
a proper method of making up their accounts, 
acquire the fortunes of princes. It was thus, as 
we are told by Machiavel, that the agents of 
Lorenzo of Medicis, not a prince of mean abi- 
lities, carried on his trade. The republic of 
Florence was feveral times obliged to pay the 
debt into which their extravagance had involved 
him. He found it convenient, accordingly, to 
give up the bufinefs of merchant, the bufinefs 

to 



THE WEALTH OF NATIONS. 24 

to which his family had originally owed their CHAP, 
fortune, and in the latter part of his life to em- 
ploy both what remained of that fortune, and 
the revenue of the flate of which he had the 
difpofal, in projects and expences more fuitable to 
his ftation. 

No two characters feem more inconfiftent than 
thofe of trader and fovereign. If the trading 
fpirit of the Englifh Eaft India company renders 
them very bad fovereigns ; the fpirit of fovereignty 
feems to have rendered them equally bad traders- 
While they were traders only they managed their 
trade fuccefsfully, and were able to pay from their 
profits a moderate dividend to the proprietors of 
their flock. Since they became fovereigns, with 
a revenue which, it is faid, was originally more 
than three millions flerling, they have been 
obliged to beg the ordinary affiftance of go- 
vernment in order to avoid immediate bank- 
ruptcy. In their former fltuation, their fervants 
in India confidered themfelves as the clerks of 
merchants : in their prefent fituation, thofe fer- 
vants confider themfelves as the minifters of fove- 
reigns. 

A STATE may fometirnes derive fome part of its 
public revenue from the interefl of money, as well 
as from the profits of ftock. If it has amafTed a 
treafure, it may lend a part of that treafure, either 
to foreign dates, or to its own fubjecls. 

THE canton of Berne derives a confiderable 
revenue by lending a part of its treafure to fo- 
reign dates ; that is, by placing it in the public 
funds of the different indebted nations of Eu- 
R 3 rope, 



246 THE NAtURE AND CAUSES OF 

BOOK rope, chiefly in thofe of France and England. The 
s * _, fecurity of this revenue mud depend, firft, upon the 
fecurity of the funds in which it is placed, or upon 
the good faith of the government which has the 
management of them ; . and, fecondly, upon the 
certainty or probability of the continuance of peace 
with the debtor nation. In the cafe of a war, the 
very firft a& of hoftility, on the part of the debtor 
nation, might be the forfeiture of the funds of its 
creditor. This policy of lending money to fo- 
reign Hates is, fo far as I know, peculiar to the 
canton of Berne. 

THE city of Hamburgh * has eftablifhed a 
fort of public pawn-mop, which lends money 
to the fubjecls of the ftate upon pledges at fix 
per cent, intereft. This pawn-mop or Lombard, 
as it is called, affords a revenue, it is pretended, 
to the itate of a hundred and fifty thoufand crowns, 
which, at four and fixpence the crown, amounts 

* 33>75 C/ - fterling. 

THE government of Pennfylvania, without amaff* 
ing any treafure, invented a method of lending, 
not money indeed, b.ut what is equivalent to 
money, to its fubjects. By advancing to pri- 
vate people, at intereft, and upon land fecurity 
to double the value, paper bills of credit to be 
redeemed fifteen years after their date, and in 
the mean time maie transferrable from hand to 
hand like bank notes, and declared by a& of af- 
fenibly to be a legjal tender in all payments from 
one inhabitant of the province to another, it 

* * See Memoires concermnt Ics Droits 3c Impofitions e 
Europe ; tome i. p. 73. 

raifed 



THE WEALTH <JF ttATtOttS. 247 

hufed a moderate revenue, xvhich went a con- c H A p. 
fiderable way towards defraying an annual ex- 
pence of about 4,5oo/. the whole ordinary ex- 
pence of that frugal arid orderly government. 
The fuccefs of an expedient of this kind niuft 
have depended upon three different circum- 
ftances ; firft, upon the demand for fome other 
inftrument of commerce, befides gold and filver 
money ; or upon the demand for fuch d. quantity 
of confumable (lock, as could ndt be had with- 
out fending abroad the greater part of 'their gold 
and filver money, in order to purchafe it ; 
fecondly, upon the good credit of the govern- 
ment which made ufe of this expedient; and, 
thirdly,, upon the moderation with which it wa3 
tifed, the whole value of the paper bills of credit 
never exceeding that of the gold and filver 
money which would have been neceffary for 
carrying on their circulation had there been no 
paper bills of credit. The fame expedient was 
upon different occafions adopted by feveral other 
American colonies ; but, from want of this mode- 
ration, it produced, in the greater part of thern^ 
much more diforder than conveniency. 

THE unftable and perifhable nature of flock 
and credit, however^ render them unfit to be 
trufled to, as the principal funds of that fure, 
fleady and permanent revenue, which can alone 
give iecurity and dignity to government. The 
government of no great nation, that was ad- 
vanced beyond the fhepherd (late, feems ever to 
have derived the greater part of its public re- 
Venue from fuch fources* 

R 4 LAND 



2 4 a THE NATURE AND CAUSES OF 

BOOK LAND is a fund of a more ftable and per- 
manent nature ; and the rent of public lands, ac- 
cordingly, has been the principal fource of the 
public revenue of many a great nation that 
was much advanced beyond the fhepherd (late. 
From the produce or rent of the public lands, 
the ancient republics of Greece and Italy de- 
rived, for a long time, the greater part of that 
revenue which* defrayed the neceffary expences 
of the commonwealth* The rent of the crown 
lands confHtuted for a long time the greater 
part of the revenue of the ancient fovereigns of 
Europe. 1 

WAR, and the preparation for war, are the 
two circumftances which in modern times occa- 
fion the greater part of the necefTary expence of 
all great ftates. But in the ancient republics of 
Greece and Italy every citizen was a v foldier* 
who both ferved and prepared hiitlfelf for fervice 
at his own expence. Neither of thofe two cir- 
cumftances, therefore, could occafion any very 
confiderable expence to the ftate. The rent of 
a very moderate landed eftate might be fully fufli- 
cient for defraying all the other neceflary ex- 
pences of government. 

IN. the ancient monarchies of Europe, the 
manners and cufloms of the times fufficiently 
prepared the great body of the people for war ; 
and when they took the field, they were, by the 
condition , of their feudal tenures, to be main- 
tained, either at their own expence, or at that 
of their immediate lords, without bringing any 
new charge upon the fovereign. The other ex- 
pences 



THE WEALTH OF NATIONS. 249 

pences of government were, the greater part of CHAP- 
them, very moderate. The adminiftration of 
juftice, it has been mown, inftead of being a 
caufe of expence, was a fource of revenue. The 
labour of the country people, for three days 
before and for three days after harveft, was 
thought a fund fufficient for making and main- 
taining all the bridges, highways, and other 
public works, which the commerce of the coun- 
try was fuppofed to require. In thofe days the 
principal expence of the fovereign feems to have 
confided in the maintenance of his own family 
and houfehold. The officers of his houfehold, ac- 
cordingly, were then the great officers of ilate. 
The lord treafurer received his rents. The lord 
fleward and lord chamberlain looked after the 
expence of his family. The care of his (tables 
was committed to the lord conflable and the lord 
marihal. His houfes were all built in the form 
of caftles, and feem to have been the principal 
fortrefles which he pofleiTed. The keepers of 
thofe houfes or caftles might be confidered as a 
fort of military governors. They feem to have 
been the only military officers whom it was ne- 
ceflary to maintain in time of peace. In thefe cir- 
cumftances the rent of a great landed eflate might, 
upon ordinary occafions, very well defray all the 
neceflary expences of government. 

IN the prefent ftate of the greater part of 'the 
civilized monarchies of Europe, the rent of all 
the lands in the country, managed as they pro- 
bably would be if they all belonged to one pro- 
prietor, would fcarce perhaps amount to the or- 
dinary 



25 THE NATURE AND CAUSES OF 

BOOK dinary revenue which they levy upon the people 
even iri peaceable times. The ordinary revenue 
of Great Britain, for example, including not 
only what is neceflary for defraying the current 
expence of the year, but for paying the intereft 
of the public debts, and for finking a part of 
the capital of thofe debts, amounts to upwards 
of ten millions a year. But the land tax, at four 
fhillings in the pound, falls fhort of two mil- 
lions a year. This land tax, as it is called* 
however, is fuppofed to be one-fifth, not only 
of the rent of all the land, but of that of all the 
houfes, and of the intereft of all the capital flock 
of Great Britain, that part of it only excepted 
which is either lent to the public, or employed 
as farming flock in the cultivation of land. A 
very confiderable part of the produce of this tax 
arifes from the rent of houfes, and the intereft 
of capital flock. The land tax of the city of 
London, for example, at four millings in the 
pound, amounts to 123, 399 /. 6s. 7 d. That of 
the city of Weflminfler, to 63,0927. i s. $ di 
That of the palaces of Whitehall and St. James's, 
to 3 0,7 54 /. 6s. %d. A certain proportion of the 
land tax is in the fame manner aflefTed upon all 
the other cities and towns corporate in the king- 
dom, and arifes almofl altogether, either from 
the rent of houfes, or from what is fuppofed to 
be the intereft of trading and capital flock. 
According to the eftimation, therefore, by which 
Great Britain is rated to the land tax, the whole 
mafs of revenue arifmg from the rent of all the 
lands, from that of all the houfes, and from the 

intereft 



THE WEALTH OF NATIONS. 251 

intered of all the capital flock, that part of it C H A P. 
only excepted which is either lent to the pub- v. 
lie, or employed in the cultivation of land, 
does not exceed ten, millions fterling a. year, the 
ordinary revenue which government levies upon 
. the people even in peaceable times. The efli- 
mation by which Great Britain is rated to the 
land-tax is, no doubt, taking the whole king- 
dom at an average, very much below the real 
value ; though in feveral particular counties and 
diflricts it is faid to be nearly equal to that 
value. The rent of the lands alone, exclufive 
of that of houfes, and of the intereil of flock, 
has by many people been eftimated at twenty 
millions, an eftimation made in a great meafure 
at random, and which, I apprehend, is as likcjy 
to be above as below the truth. But if the 
lands of Great Britain, in the prefent flare of 
their cultivation, do not afford a rent of more 
than twenty millions a year, they could not well 
afford the half, mod probably not the fourth 
part of that rent, if they all belonged to a Tingle 
proprietor, and were put under the negligent, 
expenfive, and oppreffive management of his 
faclors and agents. The crown lands of Great 
Britain do not at prefent afford the fourth part 
of the rent, which could probably be drawn 
from them if they were the property of private 
perfons. If the crown lands were more ex- 
tenfive, it is probable they would be flill worfe 
managed. 

THE revenue which the great body of the 
people derives from land is in proportion, not 

to 




252 TfrE NATURE AND CAUSES OF 

BOOK to the rentj but to the produce of the land. 
The whole annual produce of the land of every 
country if we except what is referved for feed, 
is either annually confumed by the great body 
of the people, or exchanged for fomething elfe 
that is confumed by them. Whatever keeps 
down the produce of the land below what it 
would otherwife rife to, keeps down the revenue 
of the great body of the people, flill more than 
it does that of the proprietors of land. The 
rent of land, that portion of the produce which 
belongs to the proprietors, is fcarce any where 
in Great Britain fuppofed to be more than a 
third part of the whole produce. If the land 
which in one (late of cultivation affords a rent 
of ten millions fterling a year, would in another 
afford a rent of twenty millions ; the rent being, 
in both cafes, fuppofed a third part of the pro- 
duce ; the revenue of the proprietors would be 
lefs than it otherwife might be by ten millions 
a year only ; but the revenue of the great body 
of the people would be lefs than it otherwife 
might be by thirty millions a year, deducing 
only what would be neceffary for feed. The 
population of the country would be lefs by the 
number of people which thirty millions a year, 
deducting always the feed, could maintain, ac- 
cording to the particular mode of living and 
expence which might take place in the different 
ranks of men, among whom the remainder was 
distributed. 

THOUGH there is not at prefent in Europe, 
any civilized (late of any kind which derives the 

greater 



THE .WEALTH OF NATIONS. 253 

greater part of its public revenue from the rent CHAP. 
of lands which are the property of the ftate ; yet, 
in all the great monarchies of Europe, there are 
(till many large tra&s of land which belong to 
the crown. They are generally foreft; and 
fometimes foreft where, after travelling feveral 
miles, you will fcarce find a fingle tree ; a mere 
wafte and lofs of country in refpeft both of pro- 
duce and population. In every great monarchy 
of Europe the fale of the crown lands would 
produce a very large fum of money, which, if 
applied to the payment of the public debts, 
would deliver from mortgage a much greater 
revenue. than any which thofe lands have ever 
afforded to the crown. In countries where 
lands, improved and cultivated very highly, and 
yielding at the time of fale as great a rent as can 
eafily be got from them, commonly fell at thirty 
years purchafe ; the unimproved, uncultivated, 
and low-rented crown lands might well be ex- 
pe&ed to fell at forty, fifty, or fixty years pur- 
chafe. The crown might immediately enjoy 
the revenue which this great price would redeem 
from mortgage. In the courfe of a few years 
it would probably enjoy another revenue. When 
the crown lands had become private property, 
they would, in the courfe of a few years, be- 
come well improved and well-cultivated. The 
increafe of their produce would increafe the po- 
pulation of the country, by augmenting the re- 
venue and confumption of the people. But the 
revenue which the crown derives from the du- 
ties of cuftoms and excife, \vould neceflarily 

increafc 



2 54 THE NATURE AND CAUSES OF 

BOOK increafe with the revenue and confumption of 

. v. . 

the people. 

THE revenue, which, in any civilized mo* 
narchy, the crown derives from the crown lands, 
though it appears to cod nothing to individuals, 
in reality cofts more to the fociety than perhaps 
any other equal revenue which the crown enjoys. 
It would, In all cafes, be for the intcreft of the 
fociety to replace this revenue to the crown by 
fome other equal revenue, and to divide the 
lands among the people, which could not well 
be done better, perhaps, than by expofmg them 
to public fale. 

LANDS, for the purpofes of pleafure and mag- 
nificence, parks, gardens, public walks, &c. 
poffeffions which are every where confidered as 
caufes of expence, not as fources of revenue, feem 
to be the only lands which, in a great and civi- 
lized monarchy, ought to belong to the crown, 

PUBLIC (lock and public lands therefore, the 
two fources of revenue which may peculiarly be- 
long to the fovereign or commonwealth, being both 
improper and infufficient funds for defraying the 
neceifary expence of any great and civilized ftate ; 
it remains that this expence muft, the greater part 
of it, be defrayed by taxes of one kind or another ; 
the people contributing a part of their own private 
revenue in order to make up a public revenue to 
the fovereign or commonwealth, 



WEALTH OF NATIONS. 255 

C H>A P, 
PART .II 



Of Taxes, 

TM E private revenue of individuals, it has been 
fhewn in the firft book of this Inquiry, arifes 
ultimately from three different fources ; Rent, 
Profit, and Wages. Every tax mud finally be 
paid from fome one or other of thofe three dif- 
ferent forts of revenue, or from all of them in- 
differently. I (hall endeavour to give the beft 
account I can, firft, of thofe taxes which, it is 
intended, fliould fall upon rent ; fecondly, of 
thofe which, it is intended, mould fall upon pro- 
fit ; thirdly, of . thofe which, it is intended, 
ihould fall upon wages ; and, fourthly, of thofe 
which, it is intended, mould fall indifferently 
upon all thofe three different fources of private 
revenue,. The particular confideration of each of 
thefe four different forts of taxes will divide the 
fecond part of the prefent chapter into four ar- 
ticles, three of which will require feveral other 
fubdivifions^ Many of thofe taxes it will appear 
from the following review, are not finally paid 
from the fund, or fource of revenue, upon which 
it was intended they fhould fall-. 

BEFORE I enter upon the examination of parti- 
cular taxes, it is neceffary to premife the four fol- 
lowing maxims with regard to taxes in general. 

I. THE fubje&s of every flate ought to con- 
tribute towards the fupport of the government, 
as nearly as poflible, in proportion to their re- 
fpeftive abilities \ that is, in proportion to the 

revenue 



*5 6 THE NATURE AND CAUSES OF 

BOOK revenue which they refpedively enjoy under the 
protection of the ftate. The expence of govern- 
ment to the individuals of a great nation, is like 
the expence of management to the joint tenants 
of a great eftate, who are all obliged to con- 
tribute in proportion to their refpective interefts 
in the eftate. In the obfervation or neglect of 
this maxim confifts, what is called the equality 
or inequality of taxation, Every tax, it muft be 
obferved once for all, which fails finally upon 
one only of the three forts of revenue above 
mentioned, is neceffarily unequal, in fo far as it 
does not affect the other two. In the following 
examination of" different taxes I fhall feldom take 
much further notice of this fort of inequality, 
but fhall, in moil cafes, confine my obfervations 
to that inequality which is occafioned by a par- 
ticular tax falling unequally upon that par- 
ticular fort of private revenue which is affecte4 
by it. 

II. THE tax which each individual is bound tq 
pay gught to be certain, and not arbitrary. The 
time of payment, the manner of payment, the 
quantity to be paid, ought all to be clear and 
plain to the contributor, and to every other per* 
fon. Where it is otherwife, every perfon fubjecl 
to the' tax is put more or lefs in the power of the 
tax-gatherer, who can either aggravate the tax 
upon any obnoxious contributor, or extort, by 
the terror of fuch aggravation, fome prefent or 
perquifite to himfelf. The uncertainty of taxa- 
tion encourages the infolence and favours the cor- 
ruption of an order of men who are naturally un- 
popular. 



THE WEALTH OF NATIONS. 257 

popular, even where they are neither infolent nor CHAP. 
corrupt. The certainty of what each individual 
ought to pay is, in taxation, a matter of fo great 
importance, rhat a ver y confiderable degree of 
inequality, it appears, I believe, from the expe- 
rience of all nations, is not near fo great an evil 
as a very fmall degree of uncertainty. 

III. EVERY tax ought to be levied at the time, 
or in the manner, in which it is moft likely to be 
convenient for the contributor to pay it* A tax 
upon the rent of land or of houfes, payable at the 
fame term at which fuch rents are ufually paid, 
is levied at the time when it is mofl likely to be 
convenient for the contributor to pay ; or, when 
he is moft likely to have wherewithal to pay. 
Taxes upon fuch confumable goods as are articles 
of luxury, are all finally paid by the confumerj 
and generally in a manner that is very convenient 
for him. He pays them by little and little, as he 
has occafion to buy the goods. As he is at li^ 
berty too, either to buy, or not to buy, as he 
pleafes, it muft be his own fault if he ever fufFers 
any confiderable inconveniency from fuch taxes. 

IV. EVERY tax ought to be fo contrived as 
both to take out and to keep out of the pockets 
of the people as little as poffible, over and above 
what it brings into the public treafury of the 
ftate. A tax may either take out or keep out of 
the pockets of the people a great deal more than 
it brings into the public treafury, in the four 
following ways. Firft, the levying of it may 
require a great number of officers, whofe falaries 
may eat up the greater part of the produce of the 

VOL. III. Q 



THE NATURE AND CAUSES OF 

BOOK tax, and whofe perquifites may impofe another 
additional tax upon the people. Secondly, it 
may obftruft the induflry of the people, and dif- 
courage them from applying to certain branches 
of bufinefs which might give maintenance and 
employment to great multitudes. While it 
obliges the people to pay, it may thus diminifh^ 
or perhaps deftroy, fome of the funds which 
might enable them more eafily to do fo. Thirdly,, 
by the forfeitures and other penalties which thofe 
unfortunate individuals incur who attempt un- 
fuccefsfully to evade the tax, it may frequently 
ruin them, and thereby put an end to the benefit 
which the community might have received from 
the employment of their capitals. An injudici- 
ous tax offers a great temptation to fmuggling. 
But the penalties of fmuggling muft rife in pro- 
portion to the temptation. The law, contrary to 
all the ordinary principles of juftice, firft creates 
the temptation, and then puniflies thofe who yield 
to it ; and it commonly enhances the punimment 
too in proportion to the very circumftance which 
ought certainly to alleviate it, the temptation to 
commit the crime *. Fourthly, by fubjecting 
the people to the frequent vifits and the odious 
examination of the tax-gatherers, it may expofe 
them to much unneceffary trouble, vexation, and 
eppreflion ; and though vexation is not, ftri&ly 
fpeaking, expence, it is certainly equivalent to 
the expence at which every man would be will* 
ing to redeem himfelf from it. It is in fome one 
or other of thefe four different ways that taxes> 

* See Sketches of the Hiilory of Man., page 474. & feq. 

x are 



THE WEALTH OF NATIONS. 259 

are frequently fo much more burdenfome to the c IJ A p. 
people than they are beneficial to the fovereign. 

THE evident juftice and utility of the foregoing 
maxims have recommended them more or lefs to 
the attention of all nations. All nations have en- 
deavoured, to the bed of their judgment, to render 
their taxes as equal as they could contrive ; as 
certain, as convenient to the contributor, both in 
the time and in the mode of payment, and in 
proportion to the revenue which they brought to 
the prince, as little burdenfome to the people. 
The following fhort review of fome of the prin- 
cipal taxes which have taken place in different ages 
and countries will mow, that the endeavours of 
all nations have not in this refped been equally 
fuccefsful. 



ARTICLE I. 
faxes upon Rent. Taxes upon the Rent of 

A TAX upon the rent of land may either be im- 
pofed according to a certain canon, every diftricl: 
being valued at a certain rentj which valuation is 
not afterwards to be altered ; or it may be impofed 
in fuch a manner as to vary with every variation 
in the real rent of the land, and to rife or fall 
with the improvement or declenfion of its cultiva- 
tion. 

A LAND-TAX which, like that of Great Britain, 
is affefled upon each diftrift according to a certain 
invariable canon, though it fhould be equal at 
the time of its firft eftablifhment, necetfarily 
becomes unequal in procefs of time, according 

s a to 



aSo .THE NATURE AND CAUSES OF 

BOOK to the unequal degrees of improvement or negleft 
in the cultivation of the different parts of the 
country. In England,., the valuation according 
to which the different counties and parifhes were 
affeffed to the land-tax by the 4th of William 
and Mary, was very unequal even at its firft efta- 
blifhraent. This tax, therefore, fo far offends 
againft the firft of the four maxims above-men- 
tioned. It is perfectly agreeable to the other 
three. It is perfectly certain. The time of pay- 
ment for the tax, being the fame as that for the 
rent, is as convenient as it can be to the contri- 
* butor. Though the landlord is in all cafes the 
real contributor, the tax is commonly advanced 
by the tenant, to whom the landlord is obliged 
to allow it in the payment of the rent. This tax 
is levied by a much fmaller number,, of officers 
than any other which affords nearly the fame 
revenue. As the .tax upon each diftricl: does not 
'rife with the rife of the rent, the fovereign does 
not (hare in the profits of the landlord's improve- 
ments. Thofe improvements fometimes con- 
tribute, indeed, to the difcharge of the other 
landlords of the diftricl:. But the aggravation of 
the tax, which this may fometimes occafion upon. 
a particular eftate, is always fo very fmall, that 
it never can difcourage thofe improvements, nor 
keep down the produce of the land below what 
it would otherwise rife to x . As it has no tendency 
to diminifn the quantity, it can have none to raife 
the price of that produce. It does not obftruct 
the induftry of the people. It fubje&s the landlord 
to no other inconvenicncy befides the unavoidable 
one of paying the tax, 

THB 



THE WEALTH OF NATIONS. 261 

THE advantage, however, which the landlord c *j A p. 
has derived from the invariable conftancy of the 
valuation by which all the lands of Great .Britain 
are rated to the land-tax, has been principally 
owing to fome circumftances altogether extraneous 
to the nature of the tax. 

IT has been owing in part to the great profperity 
of almoft every part of the country, the rents of 
almoft all the eftates of Great-Britain having, fince 
the time when this valuation was firft eftablifhed, 
been continually rifing, and fcarce any of them 
having fallen. The landlords, therefore, have al- 
moft all gained the difference between the tax which 
they would have paid, according to the prefent rent 
of their eftates, and that which they actually pay 
according to the ancient valuation. Had the ftate 
of the country been different, had rents been gra- 
dually falling in confeqxience of the declenfion of 
cultivation, the landlords would almoft all have 
loft this difference. In the ftate of things which 
has happened to take place fince the revolution, the 
conftancy of the valuation has been advantageous 
to the landlord and hurtful to the fovereign. In a 
different ftate of things it might have been advan- 
tageous to the fovereign and hurtful to the land- 
lord. 

As the tax is made payable in money, fo the 
valuation of the land is expreffed in money. 
Since the eftablifhment of this valuation the value 
of filver has been pretty uniform, and there has 
been no alteration in the ftandard of the coin 
either as to weight or finenefs. Had filver rifen 
confiderably in its value, as it feems to have done 

s i in 



?6* TH NATURE AND CAUSES OF 

BOOK in the courfe of the two centuries which preceded 
the difcovery of the mines of America, the con- 
ftancy of the valuation might have proved very 
oppreflive to the landlord. Had filver fallen con- 
fiderably in its value, as it certainly did for about 
a century at leaft after the difcovery of thofe mines, 
the fame conftancy of valuation would have reduced 
very much this branch of the revenue of the fove- 
reign. Had any confiderable alteration been made 
in the flandard of the money, either by linking the 
fame quantity of filver to a lower denomination, or 
by raifing it to a higher ; had an ounce of filver, for 
example, inftead of being coined into five fliil- 
lings and twopence, been coined, either into 
pieces which bore fo low a denomination as twp 
ihillings and fevenpence, or into pieces which 
tore fo high a one as ten fhillings and fourpence, 
it would in the one cafe have hurt the revenue 
of the proprietor, in the other that of the fove- 
reign. 

IN eircumftances, therefore, fornewhat dif- 
ferent from thofe which have actually taken, 
place, this conftancy of valuation might have 
been a very great inconveniency, either to the 
contributors, pr tp the commonwealth. In the, 
courfe of ages fuch circumftances, however, 
rnuft at - fome time or other, happen. But 
though empires, like all the other works of men, 
have all hitherto proved mortal, yet every empire 
aims at immortality. Every conftitution, there- 
fore, which it is meant mould be as permanent as 
the empire itfe If, ought to be convenient, not in 
pertain circumftances only, but in all circumftances j 

.or 



THE WEALTH OF NATIONS. 263 

or ought to be fuited, not to thofe circumftances CHAP, 
which are tranfitory, occafional, or accidental, but 
to thofe which are neceffary, and therefore always 
the fame. 

A TAX upon the rent of land which varies with 
every variation of the rent, or which rifes and falls 
according to the improvement or negleft of culti- 
vation, is recommended by that feel: of men of let- 
ters in France, who call themfelves the ceconomifls, 
as the moil equitable of all taxes. All taxes, they 
pretend, fall ultimately upon the rent of land, 
and ought therefore to be impofed equally upon the 
fund which mufl finally pay them. That all taxes 
ought to fall as equally as poffible upon the fund 
which mufl finally pay them, is certainly true. 
But without entering into the difagreeable dif- 
cuffion of the metaphyfical arguments by which 
they fupport their very ingenious theory, it will 
fufficiently appear, from the following review, what 
are the taxes which fall finally upon the rent of the 
land, and what are thofe which fall finally upon 
fome other fund. 

IN the Venetian territory all the arable lands 
which are given in leafe to farmers are taxed at a 
tenth of the rent*. The leafes are recorded in 
a public regifter which is kept by the officers of re- 
venue in each province or diftrir.. When the 
proprietor cultivates his own lands, they are valued 
according to an equitable eflimation, and he is al- 
lowed a deduction of one-fifth of the tax, fo that 
for fuch lands he pays only eight inftead of ten per 
cent, of the fuppofed rent, 

* Memoircs concernant les Droits, p. 240, 241. 

64 A LAND- 



264 THE NATURE AND CAUSES OP 

BOOK A LAND-TAX of this kind is certainly more 
equal than the land-tax of England. It might 
not, perhaps,, be altogether fo certain., and the 
aflefTment of the tax might frequently occafion a 
good deal more trouble to the landlord. It 
might too be a good deal more expenfive in the 
levying. 

SUCH a fyftem of administration, however, 
might perhaps be contrived as would, in a great 
meafure, both prevent this uncertainty and mode- 
rate this expence. 

THE landlord and tenant, for example, might 
jointly be obliged to record their leafe in a 
public regifter. Proper penalties might be en- 
acted againfl concealing or mifreprefenting any 
of the conditions ; and if part of thofe penalties 
were to be paid to either of the two parties who 
informed againft and convicted the other of fuch 
concealment or mifreprefentation, it would ef 
fedlually deter them from conbining together in 
order to defraud the public revenue. All the con- 
ditions of the leafe might be fufficiently known 
from fuch a record. 

SOME landlords, inflead of raifing the rent, 
take a fine for the renewal of the leafe. This 
practice is in mod cafes the expedient of a fpend- 
thrift, who for a fum of ready money fells a 
future revenue of much greater value. It is in 
moft cafes, therefore, hurtful to the landlord. 
It is frequently hurtful to the tenant, and it 
is always hurtful to the community. It fre- 
quently takes from the tenant fo great a part of 
his capital, and thereby climinifhes fo much his 
ability to cultivate the land, that he finds it more 

difficult 



THE WEALTH OF NATIONS. '265 

difficult to pay a fmall rent than it would other- c H A P. 
wile have been to pay a great one. What- 
ever diminifhes his ability to cultivate, neceffarily 
keeps down, below what it would otherwife have 
been, the mod imporcant part of the revenue of 
the community. By rendering the tax upon fuch 
fines a good deal heavier than upon the ordi- 
nary rent, this hurtful practice might be dif- 
couraged, to the no fmall advantage of all the 
different parties concerned, of the landlord, of the 
tenant, of the fovereign, and of the whole com- 
munity. 

SOME leafes prefcribe to the tenant a certain 
mode of cultivation, and a certain fucceffion of 
crops during the whole continuance of the leafe. 
This condition, which is generally the effect of 
the landlord's conceit of his own fuperior know- 
ledge (a conceit in moft cafes very ill founded), 
ought always to be confidered as an additional 
rent, as a rent in fervice inftead of a rent in 
money. In order to difcourage the pra&ice, 
which is generally a foollfh one, this fpecies of 
rent might be valued rather high, and confe- 
quently taxed fomewhat higher than common 
money rents. 

SOME landlords, inftead of a rent in money, 
require a rent in kind, in corn, cattle, poultry, 
wine, oil, &c. others again require a rent in fer- 
vice. Such rents are always more hurtful to the 
tenant than beneficial to the landlord. They 
either take more or keep more out of the pocket 
of the former, than they put into thaj: of the 
latter. In every country where they take place, 

the 



2 66 THE NATURE AND CAUSES OF 

BOOK the tenants are poor and beggarly, pretty much 
according to the degree in which they take place. 
By valuing, in the fame manner, fuch rents ra- 
ther high, and coniequently taxing them fomewhat 
higher than common money rents, a practice which 
is hurtful to the whole community might perhaps 
be fufficiently difcouraged. 

WHEN the landlord chofe to occupy himfelf a 
part of his own lands, the rent might be valued 
according to an equitable arbitration of the 
farmers and landlords in the neighbourhood, and 
a moderate abatement of the tax might be 
granted to him, in the fame manner as in the 
Venetian territory ; provided the rent of the lands 
which he occupied did not exceed a certain 
fum. It is of importance that the landlord 
fhould be encouraged to cultivate a part of his 
own land. His capital is generally greater than 
that of the tenant, and with lefs {kill he can fre- 
quently raife a greater produce. The landlord 
can afford to try experiments, and is generally 
difpofed to do fo. His unfuccefsful experi- 
ments occafion only a moderate lofs to himfelf. 
His fuccefsful ones contribute to the improve- 
ment and better cultivation of the whole coun- 
try. It might be of importance, however, that 
the abatement of the tax Ihould encourage him 
to cultivate to a certain extent only. If the 
landlords fhould, the greater part of them, be 
tempted to farm the whole of their own lands, 
the country (inilead of fober and induflrious 
tenants, who are bound by their own intereft to 
cultivate as well as their capital and ikill will 

allow 



THE WEALTH OF NATIONS. 267 

allow them) would be filled with idle and pro- C H A p. 
fligate bailiffs, whofe abufive management would 
foon degrade the cultivation, and reduce the an- 
nual produce of the land, to the diminution, not 
only of the revenue of their matters, but of the 
mod important part of that of the whole fo- 
ciety. 

SUCH a fyftem of adminiflration might, per- 
haps, free a tax of this kind from any degree of 
uncertainty which could occafion either oppreffion 
or inconveniency to the contributor; and 
might at the fame time ferve to introduce into 
the common management of land fuch a plan or 
policy, as might contribute a good deal to the 
general improvement and good cultivation of the 
.country. 

THE expence of levying a land-tax, which 
varied with every variation of the rent, would no 
doubt be fomewhat greater than that of levying one 
which was always rated according to a fixed valu- 
ation. Some additional expence would neceffarily 
be incurred both by the different regifler offices 
which it would be proper to eftablifh in the dif- 
ferent diftrids of the country, and by the different 
valuations which might occafionally be made of 
the lands which the proprietor chofe to occupy 
himfelf. The expence of all this, however, might 
be very moderate, and much below what is in- 
curred in the levying of many other taxes, which 
afford a very inconfiderable revenue in comparifon 
of what might eafily be drawn from a tax of this 
kind, 

THE 



268 THE NATURE AND CAUSES OF 

BOOK THE difcouragement which a variable land-tax of 
this kind might give to the improvement of land, 
ieems to be the moft important objection which can. 
be made to it. The landlord would certainly be 
lefs difpofed to improve, when the fovereign, who 
contributed nothing to the expence, was to mare 
in the profit of the improvement. Even this 
objection might perhaps be obviated by allowing the 
landlord, before he began his improvement, to 
afcertain, in conjunction with the officers of re- 
venue, the actual value of his lands, according to 
the equitable arbitration of a certain number of 
landlords and farmers in the neighbourhood, equally 
chofen by both parties ; and by rating liim ac- 
cording to this valuation for fu<^h a number of 
years, as might be fully fufficient for his complete 
indemnification. To draw the attention of the 
fovereign towards the improvement of the land, 
from a regard to the increafe of his own revenue, 
is one of the principal advantages propofed by this 
fpecies of land-tax. The term, therefore, al- 
lowed for the indemnification of the landlord, 
ought not to be a great deal longer than what 
was neceffary for that purpofe ; left the remote- 
nefs of the intereft mould difcourage too much 
this attention. It had better, however, be fome- 
what too long than in any refpect too fhort. No 
incitement to the attention of the fovereign can 
ever counterbalance the fmalleft difcouragement 
to that of the landlord. The attention of the 
fovereign can be at beft but a very general and 
vague confideration of what is likely to contri- 
bute 



THE WEALTH OF NATIONS. 

bute to the better cultivation of the greater part 
of his dominions. The attention of the landlord 
is a particular and minute confideration of what 
is likely to be the moft advantageous application 
of every inch of ground upon his eftate. The 
principal attention of the fovereign ought to be 
to encourage, by every means in his power, the 
attention both of the landlord and of the farmer ; 
by allowing both to purfue their own intereft in 
their own way, and according to their own judg- 
ment ; by giving to both the mod perfect fecurity 
that they fhall enjoy the full recompence of their 
own induftry ; and by procuring to both the moft 
extenfive market for every part of their produce, 
in confequence of eilablifhing the eafieft and fafeft 
communications both by land and by water, through 
every part of his own dominions, as well as the 
moil unbounded freedom of exportation to the 
dominions of all other princes. 

IF by fuch a fyftem of adminiftration a tax of* 
this kind could be fo managed as to give, not 
not only no difcouragement, but, on the contrary, 
fome encouragement to the improvement of 
land, it does not appear likely to occasion any 
other inconveniency to the landlord, except al- 
ways the unavoidable one of being obliged to pay 
the tax. 

IN all the variations of the flate of the fo- 
ciety, in the improvement and in the declenfion of 
agriculture ; in all the variations in the value of 
filver, and in all thofe in the ftandard of the coin, 
a tax of this kind would, of its own accord and 
without any attention of government, readily 

fuit 




270 THE NATURE AND CAUSES OF 

BOOK fult itfelf to the actual fituation of things, and 
would be equally juft and equitable in all thofe 
different changes. It would, therefore, be much 
more proper to be eftablifhed as a perpetual and 
unalterable regulation, or as what is called a 
fundamental law of the commonwealth, than any 
tax which was always to be levied according to a 
certain valuation. 

SOME ftates, inflead of the fimple and obvious 
expedient of a regifter of leafes, have had re* 
courfe to the laborious and expenfive one of aa 
actual furvey and valuation of all the lands in 
the country. They have fufpedted, probably, 
that the leifor and IcfTee, in order to defraud the 
public revenue, might combine to conceal the 
real terms of the leafe. Doomfday-book feems 
to have been the refult of a very accurate farvey of 
this kind. 

IN the ancient dominions of the king of 
Pruflia, the land-tax is affeflcd according to an 
actual furvey and valuation, which is reviewed 
and altered from time to time *. According to 
that valuation, the lay proprietors pay from 
twenty to twenty-five per cent, of their revenue. 
Ecclefiaftics from forty to forty-five per cent. 
The furvey and valuation of Silefia was made 
by order of the prefent king ; it is faid with great 
accuracy. According ta that valuation, the 
lands belonging to the biihop of Breflaw are 
taxed at twenty-five per cent, of their rent. The 

* Memoirea concernant les Droits, &c. tome i. p. 114* 
115, 116, &c. 

other 



THE WEALTH OF NATIONS. 

other revenues of the ecclefiaftics of both reli- c 
gions, at fifty per cent. The commanderies of 
the Teutonic order, and of that of Malta, at 
forty per cent. Lands held by a noble tenure, 
at thirty-eight and one third per cent. Lands held 
by a bafe tenure, at thirty-five and one-third per 
cent. 

THE furvey and valuation of Bohemia is faid 
to have been the work of more than a hundred, 
years. It was not perfected till after the peace 
of 17483 by the orders of the prefent emprefs 
queen *. The furvey of the dutchy of Milan, 
which was begun in the time of Charles VI. was 
not perfected till after 1760. It is efteemed one 
of the mod accurate that has ever been made. 
The furvey of Savoy and Piedmont was executed 
under the orders of the late king of Sar- 
dinia t 

IN the dominions of the king of Pruflia the 
revenue of the church is taxed much higher 
than that of lay proprietors. The revenue of 
the church is, the greater part of it, a burden 
upon the rent of land. It feldom happens that 
any part of it is applied towards the improve- 
ment of land ; or is fo employed as to contribute 
in any refpecl: towards increafing the revenue 
of the great body of the people. His Pruflian 
majefty had probably, upon that account, 
thought it reafonable, that it mould contribute a 
good deal more towards relieving the exigencies 

* Memolres concernant Ics Droits, &c. tome i. p. 83, 84. 
f Id. p. 280, &c. alfo p. 287, &c, to 316, 

Of 




27* THE NATURE AND CAtTSES OF 

B CK> K O f tne fl- ate< j n f ome countries the lands of the 
church are exempted from all taxes. In others 
they are taxed more lightly than other lands. In 
the dutchy of Milan, the lands which the church 
poffefled before 1575, are rated to the tax at a third 
only of their value. 

IN Silefia, lands held by a noble tenure are 
taxed three per cent, higher than thofe held by a 
bafe tenure. The honours and privileges of 
different kinds annexed to the former, his Pruf* 
fian majefty had probably imagined, would fuf- 
ficiently compenfate to the proprietor a fmall ag* 
gravation of the tax ; while at the fame time the 
humiliating inferiority of the latter would be in 
fome meafure alleviated by being taxed fomewhat 
more lightly. In other countries, the fyftem of 
taxation, initead of alleviating, aggravates this in* 
equality. In the dominions of the king of Sar- 
dinia, and in thofe provinces of France which 
are fubjecl: to what is called the real or predial 
taille, the tax falls altogether upon the lands held 
by a bafe tenure* Thofe held by a noble one are 
exempted. 

A LAND-TAX afleffed according to a general 
furvey and valuation, how equal foever it may 
be at firft, mufl, in the courfe of a very moderate 
period of time, become unequal. To prevent 
its becoming fo, would require the continual and 
painful attention of government to all the vari- 
ations in the ftate and produce of every different 
farm in the country. The governments of 
Pruffia, of Bohemia, of Sardinia, and of the 
dutchy of Milan, actually exert an attention of 
5 this 



THE WEALTH OF NATIONS. 273 

this kind ; an attention fo unfuitable to the na- c H A P. 
ture of government, that it is not likely to be of 
long continuance, and which, if it is continued, 
will probably in the long-run occafion much more 
trouble and vexation than it can poflibly bring re- 
lief to the contributors. 

IN 1666, the generality of Montauban was 
aflefled to the Real or predial tallie according, 
it is faid, to a very exad furvey and valuation *. 
By 1727, this afiefTinent had become altogether 
unequal. In order to remedy this inconveniency, 
government has found no better expedient than to 
impofe upon the whole generality an additional ta* 
of a hundred and twenty thoufand livres. This ad- 
ditional tax is rated upon all the different diftricls 
fubjecb to the tallie according to the old aflefirnent. 
But it is levied only upon thofe which in the actual 
ftate of things are by that afiemrient under-taxed, 
and it is applied to the relief of thofe which by the 
fame aiTeffment are over-taxed. Two diftricls, for 
example, one of which ought in the a&ual ftate of 
things to be taxed at nine hundied, the other at 
eleven hundred livres, are by the old afieffment 
both taxed at a thoufand livres. Both thefe dif- 
trids are by the additional tax rated at eleven hun- 
dred livres each. But this additional tax is levied 
only upon the diftrift under charged, and it is ap- 
plied altogether to the relief of that over-charged, 
\vhich confequently pays only nine hundred livres. 
The government neither gains nor lofes by the 
additional tax, which is applied altogether to re- 

* Memoires concernant les Droits, Sec. totnc H. p. 1 39* &c. 

VOJ. Hi. T medy 



27* THE NATURE AND CAUSES OF 

BOOK medy the inequalities arifmg from the old afleff- 
merit. The application is pretty much regulated 
according to the difcretion of the intendant of the 
generality, and muft, therefore, be in a great mea- 
iure arbitrary. 

Taxes 'which are proportioned, 'not to the Rent, but 
to the produce of Land. 

TAXES upon the produce of land are in rea- 
lity 'taxes upon the rent ; and though they may be 
originally advanced by the farmer, are finally paid 
by the landlord. When a certain portion of the 
produce is to be paid away for a tax, the farmer 
computes, as well as he can, what the value of this 
portion is, one year with another, likely to amount 
to, and he makes a proportionable abatement in the 
rent which he agrees to pay to the landlord. There 
is no fanner who does not compute beforehand what 
the church tythe, which is a land-tax of this kind, 
is, one year with another, likely to amount to. 

THE tythe, and every other land-tax of this 
kind, under the appearance of perfect equality, 
are very unequal taxes; a certain portion of the 
produce being, in different fituations, equivalent 
to a very different portion of the rent. In fome 
very rich lauds the produce is fo great, that the 
one half of it is fully fufficient to replace to the 
fanner his capital employed in cultivation, toge- 
ther with the ordinary profits of farming flock 
?n the neighbourhood. The other half, or, what 
comes to the fame thing, the value of the other 
j, he could afford to- pay as rent to the land- 

lord, 



THE WEALTH OF NATIONS. 
lord, if there was no tythe. Bat if a tenth of 
the produce is taken from him in the way of 
tythe, he muft require an abatement of the fifth 
part of his rent, otherwife he cannot get back 
his capital with the ordinary profit. In this cafe 
the rent of the landlord, |inflead of amounting 
to a half, or five-tenths of the whole prbduce, 
will amount only to four-tenths of it. In poorer 
lands, on the contrary, the produce is fometimes 
fo fmall, and the expence of cultivation fo great, 
that it requires four-fifths of the whole produce^ 
to replace to the farmer his capital with the or- 
dinary profit. In this cafe, though there was no 
tythe, the rent of the landlord could amount to 
no more than one-fifth or two tenths of the whole 
produce. But if the farmer pays one- tenth of 
the produce in the way of tythe, he mufl require 
an equal abatement of the rent of the landlord, 
which will thus be reduced to one-tenth only of 
the whole produce. Upon the rent of rich lands, 
the tythe may fometimes be a tax of no more than, 
one-fifth part, or four millings in the pound ^ 
\vhereas upon that of poorer lands, it may fome- 
times be a tax of one-half, or of ten millings in the 
pound. 

THE tythe r as it is frequently a very unequal 
tax upon the rent, fo it is always a great difcoti- 
ragement both to the improvements of the land- 
lord and to the cultivation of the farmer. The 
one cannot venture to make the mod important, 
which are generally the moil expenfivcr improve- 
ments ; nor the other to raife the moil valuable, 
which arc generally too the mod expenfive crops ; 
"T 2, when 




276' THE NATURE AND CAUSES OF 

BOOK when the church, which lays out no part of the 
expence, is to fhare fo very largely in the profit. 
The cultivation of madder was for a long time 
confined by the tythe to the United Provinces, 
which, being prefbytcrian countries, and upon 
that account exempted from this deftruftive tax, 
enjoyed a fort of monopoly of that ufeful dying 
drug againfl the reft of Europe. The late at- 
tempts to introduce the culture of this plant into 
England, have been made only in confequence of 
the ftatute which enabled that five millings an acre 
fliould be received in lieu of all manner of tythe 
upon madder. 

As through the greater part of Europe, the 
church, fo in many different countries of Afia, 
the ftate, is principally fupported by a land-tax, 
proportioned, not to the rent, but to the produce 
of the land. In China, the principal revenue of 
the fovereign confifts in a tenth part of the pro- 
duce of all the lands of the empire. This tenth 
part, however, is eftimated fo very moderately, 
that, in many provinces, it is faid not to exceed 
a thirtieth part of the ordinary produce. The 
land-tax or land-rent which ufed to be' paid to the 
Mahometan government of Bengal, before that 
country fell into the hands of the Engliih Eaft 
India company, is faid to have amounted to about 
a fifth part of the produce. The land-tax of an- 
cient Egypt is faid likewife to have amounted to a 
fifth part. 

IN Afia, this fort of land-tax is faid to intereft, 
be fovereign in the improvement and cultiva- 
tion of land. The fovereigns of China, thofe 

of 




THE WEALTH OF NATIONS, 277. 

of Bengal while under the Mahometan govern- 
ment, and thofe of ancient Egypt, are faid ac- 
cordingly to have been extremely attentive to 
the making and maintaining of good roads and 
navigable canals, in order to increafe, as much 
as poffible, both the quantity and value of every 
part of the produce of the land, by procuring to 
every part of it the moil extend ve market which 
their own dominions could afford. The tythe 
of the church is divided into fuch fmall portions, 
that no one of its proprietors can have any interefl 
of this kind. The parfon of a parifli could 
never find his account in making a road or canal 
to a diflant part of the country, in order to extend 
the market for the produce of his own particular 
parifh. Such taxes, when deftined for the main- 
tenance of the ftate, have fome advantages which 
may ferve in fome meafure to balance their incon- 
veniency. When deftined for the maintenance of 
the church, they are attended with nothing but 
inconveniency. 

TAXES upon the produce of land may be levied, 
cither in kind ; or, according to a certain valua* 
tion, in money. 

THE parfon of a parifh, or a gentleman of 
fmall fortune who lives tipon his eftate, may 
fometimes, perhaps, find fome advantage in re- 
ceiving, the one his tythe, and the other his rent, 
in kind. The quantity to be collecled, and the 
diftricl: within which it is to be collected, are fo 
fmall, that they both can overfee, with their own 
eyes, the collection and difpofal of every part of 
what is due to them. A gentleman of great for- 
T 3 tune, 



275 THE NATURE AND CAUSES OF 

BOOK tune, who lived in the capital, would be in dan- 
ger of fuffering much by the neglect, and more 
by the fraud, of his factors and agents, if the 
rents of an eflate in a diftant province were to 
be paid to him in this manner. The lofs of the 
fovereign, from the abufe and depredation of hi 
tax-gatherers, would necerTarily be much greater. 
The fervants of the molt carelefs private perfon 
are, perhaps, more under the eye of their mafter 
than thofe of the mod careful prince; and a 
public revenue, which was paid in kind, would 
furTer fo much from the mifmanageirient of the 
collectors, that a very fmall part of what was le- 
vied upon the people would ever arrive at the 
treafury of the prince. Some part of the public 
revenue of China, however, is faid to be paid 
in this manner. The Mandarins and other tax- 
gatherers will, no doubt, find their advantage in 
continuing the practice of a payment which "is fo 
much more liable to abufe than any payment in 
money. 

A TAX upon the produce of land which is le- 
vied in money, may be levied either according 
to a valuation which varies with all the varia- 
tions of the market price ; or according to a 
fixed valuation, a bumel of wheat, for example, 
being always valued at one and the fame money 
price, whatever may be the ftate of the market. 
The produce of a tax levied in the former way, 
will vary only according to the variations in the 
real produce of the land, according to the im- 
provement or neglect of cultivation. The pro- 
duce of a tax levied in the latter way, will vary 

not 



THE WEALTH OF NATIONS. 279 

not only according to the variations in the produce CHAP. 
of the land, but according both to thofe in the 
value of the precious metals, and thofe in the 
quantity of thofe metals which is at different times 
contained in coin of the fame denomination. The 
produce of the former will always bear the fame 
proportion to the value of the real produce of 
the land. The produce of the latter may, at dif- 
ferent times, bear very different proportions to that 
value. 

WHEN, inftead either of a certain portion of 
the produce of land, or of the price of a certain 
portion, a certain fum of money is to be paid in 
full compenfation for all tax or tythe ; the tax 
becomes, in this cafe, exactly of the fame nature 
with the land-tax of England. It neither rifes 
nor falls with the rent of the land. It neither 
encourages nor difcourages improvement. The 
tythe in the greater part of thofe parifhes which 
pay what is called a modus in lieu of all other 
tythe, is a tax of this kind. During the IVJaho* 
metan government of Bengal, inftead of the pay- 
ment in kind of the fifth part of the produce, a 
modus, and., it is faid, a very moderate one, was 
eftablifhed in the greater part of the diftri6ts or 
zemindaries of the country. Some of the fer* 
vants of the Eaft India company, under pre- 
tence of reftoring the public revenue to its pro* 
per value, have, in fome provinces, exchanged 
this modus for a payment in kind. Under their 
management this change is likely both to dif- 
courage cultivation, and to give new opportuni- 
ties for abufe in the collection of the public re- 
T 4 yenue a 



THE NATURE AND CAUSES OF 

BOOK venue, which has fallen very much below what it 
was faid to have been, when it firft fell under the 
management of the company. The fer vanes of the 
company may, perhaps, have profited by this 
change, but at the expence, it is probable, both 
of their mailers and of the country. 

Taxes upon the Rent of Houfes. 

THE rent of a houfe may be diftinguiihed into 
two parts, of which the one may very properly be 
called the Building rent $ the other is commonly 
called the Ground rent. 

THE building rent is the intereft or profit of 
the capital expended in building the houfe. In 
order to put the trade of a byilder upon a level 
with other trades, it is neceffary that this rent 
{hould be fufficient, firft, to pay him the fame 
intereft which he would have got for his capital 
if he had lent it upon good fecurity ; and, fe- 
condly, to keep the houfe in conftant repair, or, 
what comes to the fame thing, to replace, within 
a certain term of years, the capital which had 
been employed in building it. The building 
tent, or the ordinary profit of building, is, there- 
fore, every where regulated by the ordinary in- 
tereft of money. Where the market rate of in- 
tereft is four per cent, the rent of a houfe which, 
over and above paying the ground-rent, affords 
fix or fix and -a half per cent, upon the whole 
expence of building, may perhaps afford a fuf- 
ficient profit to the builder. Where the market 
rate of intereft is five per cent., it may perhaps 
require feven or feven and a half per cent. If, 

hi 



TOE WEALTH OF NATIONS. *8t 

In proportion to the intereft of money, the trade of c H A P, 
the builder affords at any time a much greater profit 
than this, it will foon draw fo much capital from 
other trades as will reduce the profit to its proper 
level. If it affords at any time much lefs than this, 
other trades will foon draw fo much capital from it 
as will again raife that profit. 

WHATEVER part of the whole rent of a houfe 
is over and above what is fufficient for affording 
this reafonable profit, naturally goes to the 
ground-rent ; and where the owner of the ground 
and the owner of the building are two different 
perfons, is, in mod cafes, completely paid to the 
former. This furplus rent is the price which 
the inhabitant of the houfe pays for fome real or 
fuppofed advantage of the fituation. In country 
houfes, at a diflance from any great town, where 
there is plenty of ground to chufe upon, the 
ground-rent is fcarce any thing, or no -more than 
what the ground which the houfe ftands upon 
would pay if employed in agriculture. In coun- 
try villas in the neighbourhood of fome great 
town, it is fometimes a good deal higher; and 
the peculiar conveniency or beauty of fituation 
is there frequently very well paid for. Ground- 
rents are generally higheft in the capital, and in 
thofe particular parts of it where there happen* 
to be the greateft demand for houfes, whatever be 
the reafon of that demand, whether for trade and 
bufmefs, for pleafure and fociety, or for mere 
vanity and fafhion. 

A TAX upon houfe-rent, payable by the tenant 
and proportioned to the whole rent of each houfe, 

could 



*** THE NATURE AND> CAUSES OF 

BOOK could not, for any confiderable time at leafl, 
1 affel the building rent. If the builder did not 
get his reafonable profit, he would be obliged to 
quit the trade ; which, by raifing the demand for 
building, would in a fhort time bring back his 
profit to its proper level with that of other trades. 
Neither would fuch a tax fall . altogether upon 
the ground-rent ; but it would divide itfelf in fuch 
a manner as to fall partly upon the inhabitant 
of the houfe and partly upon the owner of the 
ground. 

LET us fuppofe, for example, that a particular 
perfon judges that he can afford for houfe-rent 
an expence of fixty pounds a year; and let us 
fuppoie too that a tax of four millings in the 
pound, or of one-fifth, payable by the inhabit* 
ant, is laid upon houfe-rent. A hpufe of fixty 
pounds rent will in this cafe coft hira feventy- 
two pounds a year, which is twelve pounds more 
than he thinks he can ajFord, He will, there- 
fore, content himfelf with a worfe houfe, or a 
houfe of fifty pounds rent, which, with the ad* 
ditional ten pounds that he mufl pay for the tax, 
will make up the fum of fixty pounds a jear, the 
expence which he judges he can afford; and in 
order to pay the tax he will give up a part of the 
additional conveniency which he might have had 
from a houfe of ten pounds a year more rent, 
He will give up, I fay, a part of this additional 
conveniency ; for he will feldom be obliged to 
give up the whole, but will, in confequence of 
the tax, get a better houfe for fifty pounds a 
year, than he could have got if there had, beert 

no 



THE WEALTH OF NATIONS. ?*3 

no tax. For as a tax of this kind, by taking CHAP. 
away this particular competitor, muft diminifh 
the competition for houfes of fixty pounds rent, 
fo it muft likewife diminifh it for thofe of fifty 
pounds rent, and in the fame manner for thofe 
of all other rents, except the lowed rent, for 
which it would for fome time increaTe the com- 
petition. But the rents of every clafs of houfes 
for which the competition was diminifhed, would 
neceffarily be more or lefs reduced. As no part 
of this reduction, however, could, for any con- 
fiderable time at lead, affect the building rent ; 
the whole of it muft in the long-run neceifarily 
fall upon the ground-rent. The final payment 
of this tax, therefore, would fall, partly upon 
the inhabitant of the houfe, who, in order to pay 
his (hare, would be obliged to give up a part of 
his conveniency ; and partly upon the owner of 
the ground, who, in order to pay his mare, would 
be obliged to give up a part of his revenue. In 
what proportion this final payment would be di- 
vided between them, it is not perhaps very eafy to 
afcertain. The divifion would probably be very dif- 
ferent in different circumftances, and a tax of this 
kind might, according to thofe different circum- 
ftances, affect very unequally both the inhabitant of 
the houfe and the owner of the ground. 

THE inequality with which a tax of this kind 
might fall upon the owners of different ground- 
rents, would arife altogether from the accidental 
inequality of this divifion. But the inequality 
with which it might fall upon the inhabitants of 
different houfes, would arife, not only from this, 

but 




THE NATURE AND CAUSES OF 
but from another caufe. The proportion of the 
expence of houfe-rent to the whole expence 
of living, is different in the different degrees of 
fortune. It is perhaps highefl in the higheft de- 
gree, and it diminifhes gradually through the 
inferior degrees, fo as in general to be lowed in 
the lowed degree. The neceffaries of life occa- 
fion the great expence of the poor. They find 
it difficult to get food, and the greater part of 
their little revenue is fpent in getting it. The 
luxuries and vanities of life occafion the princi- 
pal expence of the rich ; and a magnificent houfe 
embelliflies and fets off to the bed advantage all 
the other luxuries and vanities which they poffefs. 
A tax upon houfe-rents, therefore, would in ge- 
neral fail heavied upon the rich ; and in this fort 
of inequality there would not, perhaps, be any 
thing very unreafonable. It is not very unrea- 
fonablc that the rich Ihould contribute to the 
public expence, not only in proportion to their 
revenue, but fomething more than in that pro- 
portion. 

THE rent of houfes, though it in fame refpe&s 
refembles the rent of land, is in one refpeft 
effentially different from it. The rent of land is 
paid for the ufe of a productive fubjet. The 
land which pays it produces it. The rent of 
houfes is paid for the ufe of an unproductive 
fubject. Neither the houfe nor the ground which 
it (lands upon produce any thing. The perfon 
who pays the rent, therefore, mud draw it from 
fome other fource of revenue, diftinct from and 
independent of this fubject. A tax upon the 

rent 



THE WEALTH OF NATIONS. 2*5 

rent of houfes, fo far as it falls upon the inha- C H A p. 
bitants, muft be drawn from the fame fource as 
the rent itfelf, and muft be paid from their re- 
venue, whether derived from the wages of labour, 
the profits of flock, or the rent of land. So far 
as it falls upon the inhabitants, it is one of thofe 
taxes which fall, not upon one only, but in- 
differently upon all the three different fources of 
revenue; and is in every refpect of the fame 
nature as a tax upon any other fort of con- 
fumable commodities. In general there is not, 
perhaps, any one article of expence or confump- 
tion by which the liberality or narrownefs of a 
man's whole expence can be better judged of, 
than by his houfe-rent. A proportional tax 
upon this particular article of expence might, 
perhaps, produce a more . confiderable revenue 
than any which has hitherto been drawn from it 
in any part of Europe. If the tax indeed was 
very high, the greater part of people would en- 
deavour to evade it, as much as they could, by 
contenting themfelves with fmailer houfes, and 
by turning the greater part of their expence into 
fome other channel. 

THE rent of houfes might eafily be afcertained 
wiih fufficient accuracy, by a policy of the fame 
kind with that which would be neceflary for 
afcertaining the ordinary rent of land. Houfes 
not inhabited ought to pay no tax. A tax upon 
them would fall altogether upon the proprie- 
tor, who would thus be taxed for a fubject 
which afforded him neither conveniency nor 
revenue. Houfes inhabited by the proprietor 

ought 




THE NATURE AND CAUSES OF 

ought to be rated, not according to the ex- 
pence which they might have coft in building, 
but according to the rent which an equitable 
arbitration might judge them likely to bring, 
if leafed to a tenant. If rated according to the 
cxpence which they might have coft in building, 
a tax of three or four millings in the pound, 
joined with other taxes, would ruin almofl all 
the rich and great families of this, and, I believe, 
of every other civilized country. Whoever will 
examine, with attention, the different town and 
country houfes of fome of the richeft and greatefl 
families in this country, will find that, at the 
rate of only fix and a half, or feven per cent, 
upon the original expencc of building, their houfe- 
rent is nearly equal to the whole neat rent of their 
cftates. It is the accumulated expence of feveral 
fucceilive generations, laid out upon objects of 
great beauty and magnificence, indeed ; but, in 
proportion to what they coft, of very fmall ex- 
changeable value *. 

GROUND-RENTS are a frill more proper fubjeft 
of taxation than the rent of houfes. A tax upon 
ground-rents would not raife the rents of houfes. 
It would fall altogether upon the owner of th,e 
ground-rent, who acts always as a monopolift, 
and exacts the greatcft rent which can be got for 
the ufe of his ground. More or lefs can be got 
for it according as the competitors happen to be 
richer or poorer, or caa afford to gratify their 

. Since the firfl publication of this book, a tax nearly upoa 
the above-mentioned principles has been impofed. 

8 fancy 



THE WEALTH OF NATIONS. 287 

fancy for a particular fpot of ground at a greater CHAP. 
or fmaller expence. In every country the greateft 
number of rich competitors is in the capital, 
and it is there accordingly that the higheft 
ground-rents are always to be found. As the 
weahh of thofe competitors would in no refpecl: 
be increafed by a tax upon ground- rents, they 
would not probably be difpofed to pay more for 
the ufe of the ground. Whether the tax was to 
be advanced by the inhabitant, or by the owner of 
the ground, would be of little importance. The 
more the inhabitant was obliged to pay for the tax, 
the lefs he would incline to pay for the ground ; fo 
that the final payment of the tax would fall al- 
together upon the owner of the ground-rent. The 
ground-rents of uninhabited houfes ought to pay 
no tax. 

BOTH ground-rents and the ordinary rent of 
land are a fpecies of revenue which the owner, 
in many cafes, enjoys without any care or attention 
of his own. Though a part of this revenue 
fhouid be taken from him in order to defray the 
expences of the (late, no difcouragement will 
thereby be given to any fort of induftry. The 
anneal produce of the land and labour of the 
fcciety, the real wealth and revenue of the great 
body of the people, might be the fame after fuch 
a tax as before. Ground-rents, and the ordinary 
rent of land, are, therefore, perhaps, the fpecies of 
revenue which can beft bear to have a peculiar tax 
impofed upon them. 

GROUND-RENTS feem, in this refpecl:, a more 
proper fubject of peculiar taxation than even the 

ordinary 



*88 THE NATURE AND CAUSES OF 

BOOK ordinary rent of land. The ordinary rent of land 
is, in many cafes, owing partly at leaft to the 
attention and good management of the landlord. 
A very heavy tax might difcourage too mucli this 
attention and good management. Ground-rents, 
fo far as they exceed the ordinary rent of land, 
are altogether owing to the good government of 
the fovereign, which, by protecting the induftry 
either of the whole people, or of the inhabitants 
of fome particular place, enables them to pay 
fo much more than its real value for the ground 
which they build their houfes upon ; or to make 
to its owner fo much more than compenfation 
for the lofs which he might fuftain by this ufe of 
it. Nothing can be more reafonable than that a 
fund which owes its exiftence to the good govern- 
ment of the (late, fhould be taxed peculiarly, or 
fhould contribute fomcthing more than the greater 
part of other funds, towards thefupport of that go- 
vernment. 

THOUGH, in many different countries of Eu- 
rope, taxes have been impofed upon the rent of 
houfes, I do not know of any in which ground- 
rents have been confidered as a feparate fubjeft of 
taxation. The contrivers of taxes have, pro- 
bably, found fome difficulty in afcertaining what 
part of the rent ought to be confidered as ground- 
rent, and what part ought to be confidered as 
building-rent. It mould not, however, feem very 
difficult to diftinguim thofe two parts of the rent 
from one another. 

IN Great-Britain the rent of houfes is fuppofed 
to be taxed in the fame proportion as the rent 

5 * 



THE WEALTH OF NATIONS. 

of land, by what is called the annual land-tax. CHAP. 

The valuation, according to which each different 

pariih and diftrict is afifeffed to this tax, is always 

the fame. It was originally extremely unequal, 

and it (till continues to be fo. Through the 

greater part of the kingdom this tax falls flill 

more lightly upon the rent of houfes than upon 

that of land. In fome few diftric~h only, which 

were originally rated high, and in which the rents 

of houies have fallen confiderably, the land- 

tax of three or four millings in the pound, is 

faid to amount to an equal proportion of the 

real rent of houfes. Untenanted houfes, though 

by law fubjcct to the tax, are, in moft diftricls, 

exempted from it by the favour of the affeffors ; 

and this exemption fometimes occafions fome 

little variation in the rate of particular houfes, 

though that of the diftricl: is always the fame. 

Improvements of rent, by new buildings, re- 

pairs, &c. go to the difcharge of the diflricl, 

which occafions (till further variations in the rate 

of particular houfes. 

IN the province of Holland* every houfe is 
taxed at two and a half per cent, of its value, 
without any regard either to the rent which it 
actually pays, or to the circumfhmce of its being 
tenanted or untenanted. There feems to be a 
hardlhip in obliging the proprietor to pay a tax 
for an untenanted houfe, from which he can de- 
rive no revenue, efpecially fo very heavy a tax. 
In Holland, where the market rate of intereft 



* Memoircs concemant les Droits, &c 

VOL. in. u does 



290 THE NATURE AND CAUSES OF 

BOOK does not exceed three per cent, two and a half 
per cent, upon the whole value of the houfe 
muft, in moft cafes, amount to more than a third 
of the building-rent, perhaps of the whole rent. 
The valuation, indeed, according to which the 
houfes are rated, though very unequal, is faid 
to be always below the real value. When a 
houfe is rebuilt, improved or enlarged, there 
is a new valuation, and the tax is rated ac* 
cordingly. 

THE contrivers of the feveral taxes which in 
England have, at different times, been impofed 
upon houfes, feem to have imagined that there 
was fome great difficulty in afcertaining, with 
tolerable exadnefs, what was the real rent of 
every houfe. They have regulated their taxes, 
therefore, according to fome more obvious cir- 
cumftance, fuch .as they had probably imagined 
would, in moft cafes, bear fome proportion to 
the rent. 

THE firft tax of this kind was hearth-money ; 
or a tax of two fhii lings upon every hearth. la 
order to afcertain how many- hearths were in the 
houfe, it was necefiary that the tax-gatherer 
fhould enter every room in it. This odious 
vifit rendered the tax odious. Soon after the 
revolution, therefore, it was abolifhed as a badge 
of ilavery. 

THE next tax of this kind was, a tax of two 
(hillings upon every dwelling houfe inhabited. 
A houfe with ten windows to pay four (hillings 
more. A houfe with twenty windows and up- 
wards to pay eight (hillings. This tax was 

afterwards 



' THE WEALTH OF NATIONS'* 
afterwards fo far altered, that houfes with twenty 
windows, and with lefs than thirty, were ordered 
to pay ten millings, and thofe with thirty windows 
and upwards to pay twenty {hillings. The num- 
ber of windows can, in mod cafes, be counted 
from the outfide, and, in all cafes, without enter- 
ing every room in the houfe. The vific of the 
tax-gatherer, therefore, was lefs offenfive in this 
tax than in the hearth-money. 

THIS tax was afterwards repealed, and in the 
room of it was eftablimed the window-tax, which 
has undergone two feveral alterations and aug* 
mentations. The window tax, as it (lands at 
prefent (January, 1/75), over and above the 
duty of three millings upon every houfe in Eng- 
land, and of one milling upon every houfe in 
Scotland, lays a duty upon every window, which 
in England augments gradually from two- 
pence, the lowed rate upon houfes with not 
more than feven windows ; to two millings, the 
higheft rate, upon houfes with twenty-five win- 
dows arid upwards. 

THE principal objeclion to all fuch taxes 13 
their inequality, an inequality of the worft kind, 
as they muft frequently fall much heavier upon 
the poor than upon the rich. A houfe of 
ten pounds rent in a country town may fome* 
times have more windows than a houfe of five 
hundred pounds rent in London ; and though, 
the inhabitant of the former is likely to be a 
much poorer man than that of the latter, yet 
fo far as his contribution is regulated by the win- 
dow-tax, he mufl contribute more to the fupport 
u a of 




292 THE NATURE AND CAUSES OF 

BOOK of the (late. Such taxes are, therefore, directly 
contrary to the firfl of the four maxims above 
mentioned. They do not feem to offend much 
againft any of the other three. 

THE natural tendency of the window-tax, and 
of all other taxes upon houfes, is to lower rents. 
The more a man pays for the tax, the lefs, it i* 
evident, he can afford to pay for the rent. 
Since the impolition of the window-tax, how- 
ever, the rents of houfes have upon the whole; 
fifen, more or lefs, in almofl every town and 
village of Great Britain, with which I am ac- 
quainted. Such has been almoft every where 
the ihcreafe of the demand for houfes, that it 
has raifed the rents more than the window-tax 
could fink them ; one of the many proofs of the 
great profperity of the country, and of the in- 
creating revenue of its inhabitants. Had it not 
been for the tax, rents would probably have rifen 
flill higher. 

ARTICLE !L 

Taxes upon Profit ', or upon the Revenue wifing 
from Stock* 

1m revenue or profit arifing from ftock 
naturally divides itfelf into two parts ; that 
which pays the intereft, and which belongs to 
the owner of the flock ; and that furplus part 
which is over and above what is neceflary for 
paying the intereft. 

THIS latter part of profit is evidently a fub* 
jec~t not taxable direftly. It is the compen- 



THE WEALTH OF NATIONS. 

fatlon, and in mofl cafes it is no more than a 
'very moderate compenfation, for the rilk and 
trouble of employing the flock. The employer 
muft have this compenfation, otherwise he can 
not, confidently with his own interefl, continue 
the employment. If he was taxed directly, 
therefore, in proportion to the whole profit, he 
would be obliged either to raife the rate of his 
profit, or to charge the tax upon the intereft of 
money ; that is, to pay lefs interefh If he raifed 
the rate of his profit in proportion to the tax, 
the whole tax, though it might be advanced by 
him, would be finally paid by one or other of 
two different fets of people, according to the 
different ways in which he might employ the 
flock of which he had the management. If he 
employed it as a farming flock in the cultivation 
of land, he could raife the rate of his profit only 
by retaining a greater portion, or, what conies 
to the fame thing, the price of a greater portion 
of the produce of the land ; and as this could be 
done only by a reduction of rent, the final pay- 
ment of the tax would fall upon the landlord. 
If he employed it as a mercantile or manu- 
facturing flock, he could raife the rate of his 
profit only by raifing the price of his goods ; in 
which cafe the final payment of the tax would 
fall altogether upon the confumers of thofe 
goods. If he did not raife the rate of his profit, 
he would be obliged to charge the whole tax 
upon that part of it which was allotted for the 
interefl of money. He could afford lefs intereft 
for whatever flock he borrowed, and the whole 
u 3 weight 




*94 THE NATURE AND CAUSES OF 

BOOK weight of the tax would in this cafe fall ulti- 
mately upon the imereil of money. So far as he 
could not relieve himielf from the tax in the 
one way, he would be obliged to relieve himfeif 
in the other. 

THE interefl of money feerns at firfl fight a 
fubject equally capable of being taxed directly 
as the rent of land. Like the rent of land, it is 
a neat produce which remains after completely 
compenfating the whole rifk and trouble of em- 
ploying the flock. As a tax upon the rent of 
land cannot raife rents ; becaufe the neat pro- 
duce which remains after replacing the flock 
of the farmer, together with his reafonable pro- 
fit, cannot be greater after the tax than before 
it : fo, for the fame reafon, a tax upon the in* 
tereft of money could not raife the rate of inte- 
reft ; the quantity of flock or money in the; 
country, like the quantity of land, being fupi 
pofed to remain the fame after the tax as before 
it. The ordinary rate of profit, it has been 
fhewn in the firfl book, is every .where regulated 
by the quantity of flock to be employed in pro* 
portion to the quantity of the employment, or 
of the bufinefs which rnu.ft be done by it. But 
the quantity of the employment, or of the 
bufinefs to be done by {lock, could neither be 
increafed nor dhninifhed by any tax upon the 
interefl of money. If the quantity of the flock 
to be employed therefore, was neither increafed 
nor diminifhed by it, the ordinary rate of profit 
would neceflarily remain the fame. But the por- 
tion of this profit neceflary for compenfating the 

rifc 



THE WEALTH OF NATIONS. 29$ 

rifk and trouble of the employer, would likewife C H A p. 
remain the fame ; that rifk and trouble being in 
no refped altered. The refidue, therefore, that 
portion which belongs to the owner of the ftock, 
and which pays the intereft of money, would 
neceffarily remain the fame too. At firft fight, 
therefore, the intereft of money feems to be a 
fubjed as fit to be taxed direcily as the rent of 
land. 

THERE are, however, two different circum- 
ftances which render the intereft of money a 
much lefs proper fubjecl: of direct taxation than 
the rent of land. 

FIRST, the quantity and value of the land 
which any man poffdfes can never be a fecret, 
and can always be afcertained with great exact- 
nefs. But the whole amount of the capital ftock 
which he pofieffes is almoft always a fecret, and 
can fcarce ever be afcertained with tolerable 
exa&nefs. It is liable^ befides, to almoft con- 
tinual variations. A year feldom pafles away, 
frequently not a month, fometimes fcarce a 
fmgle day, in which it does not rife or fall more 
or lefs. An inquifition into every man's private 
circumftances, and an inquifition which, in order 
to accommodate the tax to them, watched over 
all the fluctuations of his fortune, would be a 
fource of fuch continual and endlefs vexation as 
no people could fupport. 

SECONDLY, land is a fubject which cannot be 
removed, whereas ftock eafily may. The pro- 
prietor of land is neceflarily a citizen of the par- 
ticular country in which his eftate lies. The 

u 4 proprietor 




THE NATURE AND CAUSES OF 
proprietor of flock is properly a citizen of the 
world, and is not neceflarily attached to any 
particular country. He would be apt to abandon 
the country in which he was expofed to a vex- 
atious inquifition, in order to be afleffed to a 
burdenfome tax, and would remove his ftock to 
fome other country where he could either carry 
on his bufinefs, or enjoy his fortune more at his 
eafe. By removing his flock he would put an 
end to all the induftry which it had maintained 
in the country which he left. Stock cultivates 
land ; ftock employs labour. A tax which tended 
to drive away ftock from any particular country, 
would fo far tend to dry up every fource of re- 
venue both to the fovereign and to the fociety. 
Not only the profits of ftock, but the rent of land 
and the wages of labour, would neceflarily be more 
or lefs diminimed by its removal. 

THE nations, accordingly, who have attempted 
to tax the revenue arifmg from ftock, inftead 
of any fevere inquifition of this kind, have been 
obliged to content themfelves with fome very 
loofe, and, therefore, more or lefs arbitrary efti- 
mation. The extreme inequality and uncertainty 
of a tax afleiTed in this manner, can be com- 
penfated only by its extreme moderation, in con- 
fequence of which every man finds himfelf rated 
ib very much below his real revenue, that he gives 
himfelf little difturbance though his neighbour 
fhould be rated fomewhat lower. 

BY what is called the land-tax in England, 
it was intended that the ftock mould be taxed in 
the fame proportion as land. Vv hen the tax 

upon 



THE WEALTH OF NATIONS. 297 

upon land was at four fhillings in the pound, CHAP. 
or at one-fifth of the fuppofed rent, it was in- 
tended that ftock fhould be taxed at one-fifth of 
the fuppofed intereft. When the prefent annual 
land-tax was firft impofed, the legal rate of in- 
tereft was fix per cent. Every hundred pounds 
flock, accordingly, was fuppofed to be taxed at 
twenty-four fhillings, the fifth part of fix pounds. 
Since the legal . rate of intereft has been reduced 
to five per cent, every hundred pounds ftock is 
fuppofed to be taxed at twenty {hillings only. 
The fum to be raifed, by what is called the 
land-tax, was divided between the country and 
the principal towns. The greater part of it was 
laid upon the country ; and cf what was laid 
upon the towns, the greater part was aflefled 
upon the houfes. What remained to be afTeiTed 
upon the ftock or trade of the towns (for the 
ftock upon the land was not meant to be taxed) 
was very much below the real value of that ftock 
or trade. Whatever inequalities, therefore, 
there might be in the original afleflment, gave 
little difturbance. Every parim and diftrift ftill 
continues to be rated for its land, its houfes, and 
its ftock, according to the original affefTmentj 
and the almoft univerfal profperity of the coun- 
try, which in moft places has raifed very much 
the value of all thefe, has rendered thofe ine- 
qualities of ftill lefs importance now. The rate 
too upon each diftrid continuing always the 
fame, the uncertainty of this tax, fo far as it 
plight be affefied upon the ftock of any indi- 
5 




THE NATURE AND CAUSES OF 

vidual, has been very much diminifhed, as well 
as rendered of much lefs confequence. If the 
greater part of the lands of England are not 
rated to the land tax at half their actual value, 
the greater part of the flock of England is, per- 
haps, fcarce rated at the fiftieth part of its actual 
value. In foine towns the whole land-tax is 
affeffed upon houfes ; as in Weflminfler, where 
flock and trade are free. It is otherwife in Lon- 
don. 

IN all countries a fevere inquifition into the 
circumftances of private perfons has been carefully 
avoided* 

AT Hamburgh* every inhabitant is obliged 
to pay to the flate, one-fourth per cent, of all 
that he poffefTes ; and as the wealth of the people 
of Hamburgh confifls principally in flock, this 
tax may be confidered as a tax upon flock. 
Every man affefles himfelf, and in the prefence 
of the magiflrate, puts annually into the public 
coffer a certain fum of money, which he declares 
upon oath to be one-fourth per cent, of all 
that he pofieffes, but without declaring what it 
amounts to, or being liable to any examination 
upon that fubjeft. This tax is generally fup- 
pofed to be paid with great fidelity. In a fmall 
republic, where the people have entire confidence 
in their magiflrates, are convinced of the necef- 
fity of the tax for the fupport of the flate, and be- 
lieve that it will be faithfully applied to that pur- 
pofe, fuch confcientious and voluntary payment 

* Memoires coneernant les Droits, tome i. p. 74. 

may 



THE WEALTH OF NATIONS. 299 

may fometimes be expefted. It is not peculiar to CHAP. 
the people of Hamburgh. 

THE canton of Underwald in Switzerland is 
frequently ravaged by florms and inundations, 
and it is thereby expofed to extraordinary expences. 
Upon fuch occafions the people afiemble, and 
every one is faid to declare with the greatefl 
franknefs what he is worth, in order to be taxed 
accordingly. At Zurich the law orders, that, in 
cafes of neceflity, every one fhould be taxed in 
proportion to his revenue ; the amount of which, 
he is obliged to declare upon oath. They have 
no fuipicion, it is faid, that any of their fellow- 
citizens will deceive them. At Bafil the prin- 
cipal revenue of the ftate arifes from a fmall 
cuitom upon goods exported. All the citizens 
make oath that they will pay every three months 
all the taxes impofed by the law. All merchants 
and even all inn-keepers are trufted with keep- 
ing themfelves the account of the goods which 
they fell either within or without the territory. 
At the end of every three months they fend this 
account to the treafurer, with the amount of the 
tax computed at the bottom of it. It is not 
fufpefted that the revenue fuffers by this con- 
fidence*. 

To oblige every citizen to declare publicly 
upon oath the amount of his fortune, muft not, 
it feems, in thofe Swifs cantons, be reckoned a 
hardfhip. At Hamburgh it would be reckoned 
the greateft. Merchants engaged in the hazardous 

* Memoircs concernant les Drgits, tome i. p. 163 x 66. 171. 

proje&S 




THE NATURE AND CAUSES OF 
projects of trade, all tremble at the thoughts of 
being obliged at all times to expofe the real (late 
of their circumftances. The ruin of their credit 
and the mifcarriage of their projects, they forefee, 
would too often be the confequence. A fober and 
parfimonious people, who are Grangers- to all fuch 
projects, do not feel that they have occafion for any 
fuch concealment. 

IN Holland, foon after the exaltation of the 
late prince of Orange to the ftadtholderfhip, a 
tax of two per cent, or the fiftieth penny, as it 
was called, was impofed upon the whole fub- 
ftance of every citizen. Every citizen affeflfed 
himfelf and paid his tax in the lame manner as at 
Hamburgh ; and it was in general fuppofed to 
have been paid with great fidelity. The people 
had at that time the greateft affection for their 
new government^ which they had jufl eflablimed 
by a general infurre&ion. The tax was to be 
paid but once ; in order to relieve the ftate in a 
particular exigency. It was, indeed, too heavy 
to be permanent. In a country where the market 
rate of intereft feldom exceeds three per cent., a 
tax of two per tent, amounts to thirteen millings 
and fourpence in the pound upon the higheft 
neat revenue which is commonly drawn from 
flock. It is a tax which very few people could 
pay without encroaching more or lefs upon their 
capitals. In a particular exigency the people 
may, from grea: public zeal, make a great 
effort, and give up even a part of their capital,, 
in order to relieve the (late. But it is impofTible 
that they mould continue to do fo for any con- 

fiderable 



THE WEALTH OF NATIONS. 301 

fiderable time; and if they didj the tax would foon C H A p. 
ruin them fo completely as to render them altoge- 
ther incapable of fupporting the flare. 

THE tax upon flock impofed by the land-tax 
bill in England, though it is proportioned to the 
capital, is not intended to diminifh or take away 
any part of that capital. It is meant only to be a 
tax upon the interefl of money proportioned to that 
upon the rent of land; fo that when the latter is at 
four millings in the pound, the former may be at 
four millings in the pound too. The tax at Ham- 
burgh, and the flill more moderate taxes of Un- 
derwald and Zurich, are meant, in the fame man* 
ner, to be taxes, not upon the capital, but upon 
the interefl or neat revenue of flock. That of Hol- 
land was meant to be a tax upon the capital. 

Taxes upon the Profit of particular Employments. 

IN fome countries extraordinary taxes are im- 
pofed upon the profits of flock ; fometimes when 
employed in particular branches of trade, and fome- 
times when employed in agriculture. 

OF the former kind are in England the tax upon 
hawkers and pedlars, that upon hackney coaches 
and chairs, and that which the keepers of ale-houfes 
pay for a licence to retail ale and fpirituous' liquors. 
During the late war, another tax of the fame kind 
was propofed upon mops. The war having been 
undertaken, it was faid, in defence of the trade of 
the country, the merchants, who were to profit 
by it, ought to contribute towards the fupport 
of it. 

A TAX, 




THE NATURE AND CAUSES OF 
A TAX, however, upon the profits of (lock em- 
ployed in any particular branch of trade, can never 
fall finally upon the dealers (who mull m ail ordi- 
nary cafes have their reafonable profit, and, where 
the competition is free, can feldom have more than 
that profit), but always upon the confumers. who 
mufl be obliged to pay in the price of the goods the 
tax which the dealer advances ; and generally with 
fome overcharge. 

A TAX of this kind when it is proportioned to the 
trade of the dealer, is finally paid by the confumer, 
and occafions no oppreffion to the dealer. When 
it is not fo proportioned, but is the fame upon all 
dealers, though in this cafe too it is finally paid by 
the confumer, yet it favours the great, and occa- 
fions fome oppreffion to the fmall dealer. The tax 
of five (hillings a week upon every hackney coach, 
and that of ten fhillings a year upon every hackney 
chair, fo far as it is advanced by the different 
keepers of fuch coaches and chairs, is exadJy 
enough proportioned to the extent of their refpeftive 
dealings. It neither favours the great, nor op- 
prefTes the fmaller dealer. The tax of twenty fhil- 
lings a year for a licence to fell ale; of forty fhillings 
for a licence to fell fpirituous liquors; and of 
forty fhillings more for a licence to fell wine, 
being the fame upon all retailers, mufl necefTarily 
give fome advantage to the great, and occafion 
fome oppreffion to the fmall dealers. The former 
mufl find it more eafy to get back the tax in the 
price of theif goods than the latter. The mode- 
ration of the tax, however, renders this inequa- 
lity of lefs importance, and it may to many 

people 



THE WEALTH OF NATIONS. 303 

people appear not improper to give fome dif- C H A p. 
couragement to the multiplication of little ale- 
houfes. The tax upon (hops, it was intended, 
fhould be the fame upon all (hops. It could not 
well have been otherwife. It would have been 
impoflible to proportion with tolerable exa&nefs 
the tax upon a mop to the extent of the trade 
carried on in it, without fuch an inquifidon as 
would have been altogether infupportable in a 
free country. If the tax had been confiderable, 
it would have opprefied the fmall, and forced 
almoft the whole retail trade into the hands of 
the great dealers. The competition of the former 
being taken away, the latter would have enjoyed 
a monopoly of the trade ; and like all other mo- 
nopolifls would foon have combined to raife 
their profits much beyond what was neceflary for 
the payment of the tax. The final payment, 
inftead of falling upon the fhopkeeper, would have 
fallen upon the confumer, with a confiderable over- 
charge to the profit of the fhopkeeper. For thrfe 
reafons, the project of a tax upon mops was laid 
afide, and in the room of it was fubflituted the 
fubfidy 1759. 

WHAT in France is called the perfonal taille 
is, perhaps, the mod important tax upon the pro- 
fits of itock employed in agriculture that is levied 
in any part of Europe. 

IN the diforderly (late of Europe during the 
prevalence of the feudal government, the fo- 
vereign was obliged to content himfeif with tax- 
ing thofe who were too weak to refufe to pay 
taxes. The great lords, though willing to affift 

him 




THE NATURE AND CAUSES OF 

upon particular emergencies, refufed to 
fubjecl: themfelves to any conftant tax, and he 
was not ftrong enough to force them. The oc- 
cupiers of land all over Europe were, the greater 
part of them, originally bond-men. Through 
the greater part of Europe they were gradually 
emancipated. Some of them acquired the pro- 
perty of landed eftates which they held by fome 
bafe or ignoble tenure, fometimes under the 
king, and fometimes under fome other grat 
lord, like the ancient copy-holders of England. 
Others, without acquiring the property, obtain- 
ed leafes for terms of years, of the lands which 
they occupied under their lord, and thus became 
lefs dependent upon him. The great lords feeni 
to have beheld the degree of profperity and in- 
dependency, which this inferior order of men 
had thus come to enjoy, with a, malignant and 
contemptuous indignation, and willingly con- 
fented that the fovereign mould tax them. In 
fome countries this tax was confined to the lands 
which were held in property by an ignoble 
tenure ; and, in this cafe, the taille was faid to be 
real. The land tax eftablifhed by the late king 
of Sardinia, and the taille in the provinces of 
Languedoc, Provence, Dauphine, and Brittany; 
in the generality of Montauban, and in the elec- 
tions of Agen and Condom, as well as in fome other 
diftri&s of France, are taxes upon lands held in 
property by an ignoble tenure. In other countries 
the tax was laid upon the fuppofed profits of all 
thofe who held in farm or leafe lands belonging 
to other people, whatever might be the tenure 

by 



THE WEALTH OF NATIONS. 305 

by which the proprietor held them ; and in this c H n A p 
cafe the taille was faid to be perfonal. In 
the greater part of thofe provinces of France, 
which are called the Countries of Elections, the 
taille is of this kind. The real taille, as it 
is impofed only upon a part of the lands of 
the country, is neceffarily an unequal, but it 
is not always an arbitrary tax, though it is fo 
upon fome occafions. The perfonal taille, as 
it is intended to be proportioned to the profits of 
a certain clafs of people, which can only be 
guefled at, is neceflarily both arbitrary and un- 
equal. 

IN France the perfonal taille at prefent (1775)" 
annually impofed upon the twenty generalities, 
called the Countries of Elections, amounts to 
40,107,239 livres, 16 fous *. The proportion 
in which this fum is affefled upon thofe different 
provinces, varies from year to year, according to 
the reports which are made to the king's council 
concerning the gaodnefs or badnefs of the crops> 
as well as other circumftances, which may either 
increafe or diminifh their refpective abilities to 
pay. Each generality is divided into a certain 
number of elections, and the proportion in which 
the fum impofed upon the whole generality is 
divided among thofe different elections, varies 
likewife from year to year, according to the re- 
ports made to the council concerning their re- 
fpective abilities. It feems impofilble that the 
council, with the bed intentions, can ever pro- 

* Memoires concernant les Droits, &c. tome ii. p. 17. 

VOL. HI. x portion 



36 THE NATURE AND CAUSES OF 

BOOK portion with tolerable exactnefs, either of thofe 
two affefTinents to the real abilities of the pro- 
vince or diflrict upon which they are refpectively 
laid. Ignorance and mifmformation muft al- 
ways, more or lefs, miflead the mod upright 
council. The proportion which each parifh 
ought to fupport of what is affeffed upon the 
whole election, and that which each individual 
ought to fupport of what is affeffed upon his 
particular parifh, are both in the fame manner 
varied, from year to year, according as circum- 
fiances are fuppofed to require. Thefe circum- 
ftances are judged of, in the one cafe, by the 
officers of the election ; in the other, by thofe of 
the parifh ; and both the one and the other are, 
more or lefs, under the direction and influence of 
the intendant. Not only ignorance and mifm- 
formation, but friendfhip, party animofity, and 
private refentment, are faid frequently to miflead 
fuch afferTors. No man fubject to fuch a tax, it 
is evident, can ever be certain, before he is af- 
feffed, of what he is to pay. He cannot even 
be certain after he is aflefTed. If any perfon has 
been taxed who ought to have been exempted ; 
or if any perfon has been taxed beyond his pro- 
portion, though both muft pay in the mean time, 
yet if they complain, and make good their com- 
plaints, the whole parifh is reimpofed next year 
in order to reirnburfe them. If any of the con- 
tributors become bankrupt or infolvent, the col* 
lector is obliged to advance his tax, and the 
whole .parifh is reimpofed next year in order to 
reimburfe the collector. If the collector himfelf 

fhould 



THE WEALTH OF NATIONS. 307 

fhould become bankrupt, the parifh which elects G H A P. 
him mud anfwer for his conduct to the receiver- 
general of the election. But, as it might be 
troublefome for the receiver to profecute the 
whole parifh, he takes at his choice five or fix 
of the riehefl contributors, and obliges them to 
make good what had been loft by the t infolvency 
of the collector* The parifh is afterwards re - 
impoied in order to reimburfe thofe five or fix. 
Such reimpofitions are always over and above 
the taille of the particular year in which they are 
laid on. 

WHEN a tax is impofed upon the profits of 
flock in a particular branch of trade, the traders 
are all careful to bring no more goods to market 
than what they can fell at a price fufficient to 
reimburfe them for advancing the tax. Some of 
them withdraw a part of their flocks from ths 
trade, and the market is more fparingly fupplied 
than before. The price of the goods rifes, and 
the final payment of the tax falls upon the con- 
fumer. But when a tax is impofed upon the 
profits of flock employed in agriculture, it is 
nor the interefl of the farmers to withdraw any 
part of their flock from that employment. Each 
farmer occupies a certain quantity of land, for 
which he pays rent. For the proper cultivation 
of this land' a certain quantity of flock is necef- 
fary ; and by withdrawing any part of this ne- 
ceflary quantity, the farmer is not likely to be 
more able to pay either the rent or the tax. In 
order to pay the taxj it can never be his interefl 
to diminifh the quantity of his produce, nor con- 
x 2 fequently 



38 THE NATURE AND CAUSES OF 

B O O K fequently to fupply the market more fparingly than 
before. The tax, therefore, will never ena- 
ble him to raife the price of his produce, fo as 
to reimburfe himfelf by throwing the final pay- 
ment upon the confumer. The farmer, how- 
ever, muft have his reafonable profit as well as 
every other dealer, other wife he muft give up the 
trade. After the impofition of a tax of this 
kind, he can get this reafonable profit only by 
paying lefs rent to the landlord. The more he 
is obliged to pay in the way of tax, the lefs he 
can afford to pay in the way of rent. A tax of 
this kind impoled during the currency of a leafe 
may, no doubt, diftrefs or ruin the farmer. 
Upon the renewal of the leafe it muft always fall 
upon the landlord. 

IN the countries where the perfonal taille takes 
place, the farmer is commonly affeffed in propor- 
tion to the flock which he appears to employ in 
cultivation. He is, upon this account, fre- 
quently afraid to have a good team of horfes o* 
oxen, but endeavours to cultivate with the mean- 
eft and moft wretched instruments of hufbandry 
that he can. Such is his diftruft in the juftice 
of his affeffors, that he counterfeits poverty, 
and wifties- to appear fcarce able to pay any thing 
for fear of being .obliged to pay too much. By 
this miferable policy he does not; perhaps, always 
confult his own intereft in the moft effectual man- 
ner ; and he probably lofes more by the diminu- 
tion of his prodtrce than he faves by that of his- 
tax. Though, in confequence of this wretched 
cultivation., the market is, no doubt, fomewhat 

worfe 



THE WEALTH OF NATIONS. 309 

worfc fupplicd ; yet the fmall rife of price which CHAP. 
this may occafion, as it is not likely even to in- 
demnify the farmer for the diminution of his 
produce, it is ftill lefs likely to enable him to 
pay more rent to the landlord. The public, 
the farmer, the landlord, all fuffer more or lefs 
by this degraded cultivation. That the perfonal 
taille tends, in many different ways, to difcourage 
cultivation, and confequently to dry up the prin- 
cipal fource of the wealth of every great country, 
I have already had occafion to obferve in the third 
book of this Inquiry. 

WHAT are called poll-taxes in the fout-hern pro- 
vinces of North America, and in the Weft Indian 
iflands, annual taxes of fo much a head upon every 
negroe, are properly taxes upon the profits of a 
certain fpecies of flock employed in agriculture* . 
As the planters are, the greater part of them, both 
farmers and landlords, the final payment of the tax 
falls upon them in their quality of landlords with- 
out any retribution, 

TAXES of fo much a head upon the bondmen 
employed in cultivation feem anciently to have 
been common all over Europe. There fubfifts 
at prefent a tax of this kind in the empire of 
Ruffia. It is probably upon this account that 
poll-taxes of all kinds have often been repre- 
fented as badges of flavery. Every tax, how- 
ever, is to the perfon who pays it a badge, not of 
flavery, but of liberty. It denotes that he is 
fubjed to government, indeed, but that, as he 
has fome property, he cannot himfelf be the pro- 
perty of a matter. A poll-tax upon flaves is 

x 3 altogether 



510 THE NATURE AND CAUSES OF 

BOOK altogether different from a poll-rax upon free- 
men. The latter is paid by the perfons upon 
whom it is impofed ; the former by a different 
fet of perfons. The latter is either altogether 
arbitrary or altogether unequal, and in mofl cafes 
is both the one and the other ; the former, 
though in fome refpects unequal, different flaves 
being of different values, is in no refpecl arbi- 
trary. Every matter who knows the number of 
his own flaves, knows exactly what he has to 
pay. Thofe different taxes, however, being called 
by the fame name, have been considered as of the 
fame nature. 

THE taxes which in Holland are impofed upon 
men and maid fervants, are taxes, not upon 
flock, but upon expence; and fo far refemble 
the taxes upon confumable commodities. The 
tax of a guinea a head for every man fervant, 
which has lately been impofed in Great-Britain, 
is of the fame kind. It falls heavieft upon the 
middling rank. A man of two hundred a year 
jnay keep a fingle man fprvant. A man of ten 
thoufand a year will not keep fifty. It does not 
affecl: the poor. 

TAXES upon the profits of flock in particular 
employments can never affecl: the intereft of 
money. Nobody will lend his money for lefs 
intereft to thofe who exercife the taxed, than to 
thofe who exercife the untaxed employments. 
Taxes upon the revenue arifing from flock in all 
employments, where the government attempts to 
levy them with any degree of exaclnefs, will, in 
rnany cafes, fall upon the intereft of money, 

The 



THE WEALTH OF NATIONS. 311 

The Vingtieme, or twentieth penny, in France, CHAP. 
is a tax of the fame kind with what is called the . 1 1 
land-tax in England, and is affeffed, in the fame 
manner, upon the revenue arifing from land, 
houfes, and flock. So far as it affects flock it is 
affeffed, though not with great rigour, yet with 
much more exaclnefs than that part of the land- 
tax of England which is impofed upon the fame 
fund. It, in many cafes, falls altogether upon 
the interefl of money. Money is frequently 
funk in France upon what are called Contracts 
for the conflitution of a rent ; that is, perpetual 
annuities redeemable at any time by the debtor 
upon payment of the fum originally advanced, 
but of which this redemption is not exigible by 
the creditor except in particular cafes. The 
Vingtieme feems not to have raifed the rate of 
thofe annuities, though it is exactly levied upon 
them all. 



APPENDIX to ARTICLES I. and II. 

Taxes upon the capital Value of Land, Hotifes, and 
Stock. 

WHILE property remains in the pofleflion of 
the fame perfon, whatever permanent taxes may 
have been impofed upon it, they have never been 
intended to diminjfh, or take away any part 
of its capital value, but only fome part of the 
revenue arifmg from it. But when property 
changes hands, when it is tranfmitted either from 
the dead to the living, or from the living to the 
x 4 living, 



5t2 THE NATURE AND CAUSES OF 

BOOK living, fuch taxes have frequently been impofed 
upon it as necefiarily take away fome part of its 
capital value. 

THE transference of all forrs of property from 
the dead to the living, and that of immoveable 
property, of lands and houfes, from the living to 
the living, are tranfa&ions which are in their 
nature either public and notorious, or fuch as 
cannot be long concealed, Such tranfadtions* 
therefore, may be taxed diredly. The tranf- 
ference of flock or moveable property, from the 
living to the living, by the lending of money, is 
frequently a fecret tranfadion, and may always 
be made fo. It cannot eafily, therefore, be 
taxed directly. It has been taxed indirectly in 
two different ways ; firft, by requiring that the 
deed, containing the obligation to repay, mould 
be written upon paper or parchment which ha4 
paid a certain flamp duty, otherwife not to be 
valid ; fecondly, by requiring, under the like 
penalty of invalidity, that it mould be recorded 
either in a public or fecret regifler, and by 
impofing .certain duties upon fuch regiflration. 
Stamp duties and duties of regiflration have 
frequently been impofed likewife upon the deeds 
transferring property of all kinds from the dead 
to the living, and upon thofe transferring im- 
moveable property from the living to the living, 
tranfactions which might eafily have been taxed 
direftly. 

THE Vicefima Hereditatum, the twentieth 
penny of inheritances, impofed by Auguflus 
upon the ancient Romans, was a tax upon the 

transference 



THE WEALTH OF NATIONS. 3 "3 

transference of property from the dead to the CHAP. 
living. Dion Caflius *, the author who writes 
concerning it the leafl indiftin&ly, fays, that it was 
impofed upon all fucceflions, legacies, and dona- 
dons, in cafe of death; except upon thofe to the 
neareft relations, and to the poor. 

OF the fame kind is the Dutch tax upon 
fucceflions -f- . Collateral fucceflions are taxed, 
according to the degree of relation, from five to 
thirty per cent, upon the whole value of the 
fuc.cefiion. Teftamentary donations, or legacies 
to collaterals, are fubject to the like duties. 
Thofe from hufband to wife, or from wife to 
hufband, to the fiftieth penny. The Luctuofa 
Herediras, the mournful fucceflion of afcendents 
to defcendents, to the twentieth penny only. 
Direct fucceflions, or thofe of dependents to 
afcendents, pay no tax. The death of a father, 
to fuch of his children as live in the fame houfe 
with him, is feldom attended with any increafe, 
and frequently with a confiderable diminution of 
revenue ; by the lofs of his induftry, of his office, 
or of fome life-rent eftate, of which he may have 
been in pofleflion. That tax would be cruel and 
oppreflive which aggravated their lofs by taking 
from them any part of his fucceflion. It may, 
however, fometimes be otherwife with thofe 
children, who, in the language of the Roman 

* Lib. 55. See alfo Burman de Veftigalibus Pop. Rom. 
cap. xi. and Bouchaud de 1' impot du vjngtieme fur les fuc- 



ceflions. 



Sec Memoircs concernant les Droits, &c. tome i. p. 225. 

law, 



3*4 THE NATURE AND CAUSES OF 

B CM) K law, are faid to be emancipated ; in that of the 
Scotch law, to be foris-fami Hated ; that is, who 
have received their portion, have got families of 
their own, and are fupported by funds feparate 
and independent of thofe of their father. What- 
ever part of his fucceffion might come to fuch 
children would be a real addition to their fortune, 
and might, therefore, perhaps, without more incon- 
veniency than what attends all duties of this kind, 
be liable to fome tax. 

THE cafualties of the feudal law were taxes 
upon the transference of land, both from the dead 
to the living, and from the living to the living. 
In ancient times they conflituted in every part of 
Europe one of the principal branches of the revenue 
of the crown. 

THE heir of every immediate vaflal of the 
crown paid a certain duty, generally a year's 
rent, upon receiving the inveftiture of the eflate, 
If the heir was a minor, the whole rents of the 
eflate, during the continuance of the minority, 
devolved to the fuperior without any other 
charge, befides the maintenance of the minor, 
and the payment of the widow's dower, when 
there happened to be a dowager upon the land. 
When the minor came to be of age, another tax, 
called Relief, was dill due to the fuperior, which 
generally amounted likewife to a year's rent. A 
long minority, which in the prefent times fo 
frequently difburdens a great eflate of all its in- 
cumbrances, and reftores the family to their 
ancient fplendour, could in thofe times have no 
fueh effect. The wafle, and not the difmcum- 

brance 



THE WEALTH OF NATIONS. 

brance of the eftate, was the common efibft of a 
Jong minority. 

BY the feudal law the vaffal could not alienate 
without the confent of his fuperior, who gene- 
rally extorted a fine or compofition for granting 
it. This fine, which was at firft arbitrary, came 
in many countries to be regulated at a certain 
portion of the price of the land. In fome coun- 
tries, where the greater part of the other feudal 
cufloms have gone into difufe, this tax upon the 
alienation of land ftili continues to make a very 
confiderable branch of the revenue of the fove- 
reign. In the canton of Berne it is fo high as a 
fixth part of the price of all noble fiefs ; and a 
tenth part of that of all ignoble ones *. In the 
canton of Lucerne the tax upon the fale of lands 
is not univerfal, and takes place only in cer- 
tain diftricts, But if any perfon fells his land, 
in order to remove out of the territory, he pays 
ten per cent, upon the whole price of the fale f . 
Taxes of the fame kind upon the fale either of 
all lands, or of lands held by certain tenures, take 
place in many other countries, and make a more 
or lefs confiderable branch pf the revenue of the 
fovereign. 

SUCH tranfacYions may be taxed indirectly, by 
means either of ftamp duties, or of duties upon 
regiftration ; and thofe duties either may or may 
not be proportioned to the value of the fubjecT: 
which is transferred, 

* Memoircs concernant les Droits, &c. tome i. p. 154, 
t ld - ? '57- 

IH 





THE NATURE AND CAUSES OF 

IN Great-Britain the (lamp-duties are higher or 
lower, not fo much according to the value of the 
property transferred (an eighteen penny or half 
crown (lamp being fufficient upon a bond for the 
largeft fum of money) as according to the nature 
of the deed. The higheft do not exceed fix pounds 
upon every flieet of paper, or fkin of parchment ; 
and thefe high duties fall chiefly upon grants from 
the crown, and upon certain law proceedings, 
without any regard to the value of the fubject. 
There are in Great Britain no duties on the re- 
giflration of deeds or writings, except the fees of 
the officers who keep the regifter ; and thefe are 
feldom more than a reafonable recompence for 
their labour. The crown derives no revenue from 
them, 

IN Holland * there are both (lamp-duties and 
duties upon regiftration ; which in fome cafes 
are, and in fome are not proportioned to the 
value of the property transferred. All tefta- 
ments mufl be written upon damped paper of 
which the price is proportioned to the property 
difpofed of, fo that there are (lamps which cofl 
from three pence or three (livers a meet, to 
three hundred florins, equal to about twenty- 
feven pounds ten millings of our money. If the 
{lamp is of an inferior price to what the teftator 
ought to have made ufe of, his fucceflion is 
coiififcated. This is over and above all their 
other taxes on fucceflion. Except bills of ex- 

* Memoires concernant ks Droits, &c. tome i. p. 223, 224, 
225. 

change, 



THE WEALTH OF NATIONS. 
change, and fome other mercantile bills, all 
other deeds, bonds, and contracts, are fubjccl to 
a (lamp-duty. This duty, however, does not rife 
in proportion to the value of the fubjecl. All fales 
of land and of houfes, and all mortgages upon 
either, muft be regiftered, and, upon regiftration, 
pay a duty to the (late of two and .a half per cent, 
upon the amount of the price or of the mortgage. 
This duty is extended to the fale of all (hips 
and vefTels of more than two tons burden, whe- 
ther decked or undecked. Thefe, it feems, are 
confidered as a fort of houfes upon the water. 
The fale of moveables, when it is ordered by a 
court of juftice, is fubjed to the like duty of two 
and a half per cent. 

IN France there are both (lamp-duties and duties 
upon regiftration. The former are confidered as a 
branch of the aids or excife, and in the provinces 
where thofe duties take place, are levied by the ex- 
cife officers. The latter are confidered as a branch 
of the domain of the crown, and are levied by a 
different fet of officers. 

THOSE modes of taxation, by (lamp duties and 
by duties upon regiftration, are of very modern 
invention. In the courfe of little more than a 
century, however, (lamp duties have, in Europe, 
become almoft univerfal, and duties upon regiftra- 
tion extremely common. There is no art which 
one government fooner learns of another, than 
that of draining money from the pockets of the 
people. 

TAXES upon the transference of property from 

the dead to the living, fall finally as well as jmme- 

-J diately 




3i8 THE NATURE AN# CAUSES OF 

BOOK diately upon the perfons to whom the property 
is transferred. Taxes upon the fale of land faJl 
altogether upon the feller. The feller is almoft 
always under the neceffity of felling, and muft, 
therefore, take fuch a price as he can get. The 
buyer is fcarce ever under the neceffity of buy- 
ing, and will, therefore, only give fuch a price 
as he iikes. He confiders what the land will 
coft him in tax and price together. The more 
he is obliged to pay in the way of tax, the lefs 
he will be difpofed to give in the way of price. 
Such taxes, therefore, fall almoft always upon a 
neceffitous perfon, and muft, therefore, be fre- 
quently very cruel and oppreffive. Taxes upon 
the fale of new-built houfes, where the building 
is fold without the ground, fall generally upon 
the buyer, becaufc the builder muft generally 
have his profit ; otherwife he muft give up the 
trade. If he advances the tax, therefore, the 
buyer muft generally repay it to him. Taxes 
upon the fale of old houfes, for the fame reafon 
as thofe upon the fale of land, fall generally upon 
the feller ; whom in moft cafes either conve- 
niency or neceffity obliges to fell. The number 
of new-built houfes that are annually brought to 
market, is more or lefs regulated by the de- 
mand. Unlefs the demand is fuch as to afford 
the builder his profit, after paying all expence?, 
he will build no more houfes. The number of 
old houfes which happen at any time to come to 
market is regulated by accidents of which the 
greater part have no relation to the demand. 
Two or three great bankruptcies in a mercantile 

town 



THE WEALTH OF NATIONS. 3x9 

town, will bring many houfes to fale, which muft CHAP. 
be fold for what can be got for them. Taxes upon 
the fale of ground-rents fall altogether upon the 
feller ; for the fame reafon as thofe upon the fale 
of land. Stamp-duties, and duties upon the re- 
giflration of bonds and contracts for borrowed 
money, fall altogether upon the borrower, and, in 
fact, are always paid by him. Duties of the fame 
kind upon law proceedings fall upon the fuitors. 
They reduce to both the capital value of the fub- 
jedt in difpute. The more it cofts to acquire any 
property, the lefs mufl be the neat value of it when 
acquired. 

ALL taxes upon the transference of property 
of every kind, fo far as they diminifh the capital 
value of that property, tend to diminifh the funds 
deflined for the maintenance of productive labour. 
They are all more or lefs unthrifty taxes that in- 
creafe the revenue of the fovereign, which feldom 
maintains any but unproductive labourers ; at the 
expence of the capital of the people, which main- 
tains none but productive. 

SUCH taxes, even when they are proportioned 
to the value of the property transferred, are flill 
unequal ; the frequency of transference not being 
always equal in property of equal value. When 
they are not proportioned to this value, which is 
the cafe with the greater part of the (lamp- 
duties, and duties of regiftration, they are dill 
more fo. They are in no refpect arbitrary, but 
are or may be in all cafes perfectly clear and 
certain. Though they fometimes fall upon the 
perfon who is not very able to pay j the time of 

payment 



320 , THE NATURE AND CAUSES ^OF 

^ ) K payment is in moft cafes fufficiently convenient fof 
him. When, the payment becomes due, he muft 
.in inofl cafes have the money to pay. They are 
levied at very little expence, and in general fubjeft 
the contributors to no other inconveniency befides 
.always the unavoidable one of paying the tax, 

IN France the {lamp duties are not much com- 
plained of. Thofe of regiflration, which they call 
the Controle, are. They give occafion, it is pre- 
tended, to much extortion in the officers of the 
farmers-general who collecl the tax, which is in a 
.great meafure arbitrary and uncertain. In, ..the 
greater part of the libels which have been written 
,. agaiufl the prefent fyftem of finances in France, 
the abufes of the Controle .make a principal ar- 
ticle. Uncertainty, however, does notfeerritp be 
neceffarily inherent in the nature, of -fv^ch taxes. 
If the popular complaints are well founded, the 
abufe mud arife, not fo much frQm^th^ nature of 
.the tax, as from the want of precifieivand diftinQ:- 
nefs in the words of the edids or laws which im- 
pofeit. 

1 HE regiitratioa of mortgages, and m general 
of all rights upon immoveable property, as it 
.gives great fecurity both to creditors and pur- 
chafers, is extremely advantageous to the piibfic. 
That of the greater part of deeds of other kinds 
is frequently inconvenient and even dangerous 
to individuals, without any advantage to the 
public. All regiders which, it is acknowledged, 
ought to be kept fecret, ought certainly never 
to exift. The credit of individuals ought cer- 
tainly never to depend upon ib very {lender a fecu- 
rity 



THE WEALTH OF NATIONS. 321 

rity as the probity and religion of the inferior c H n A p - 
officers of revenue. But where the fees of re- 
giftration have been made a fource of revenue to 
the fovereign, regifter offices have commonly 
been multiplied without end, both for the deeds 
which ought to be regiftered, and for thofe which 
ought not. In France there are feveral different 
forts of fecret regifters. This abufe, though not 
perhaps a neceflary, it muft be acknowledged, 
is a very natural effect of fuch taxes. 

Sucrt (lamp-duties as thofe in England upon 
Cards and dice, upon news-papers and periodical 
pamphlets, &c. are properly taxes upon con- 
fumption ; the final payment falls upon the perfona 
who ufe or confume fuch commodities. Such 
(lamp-duties as thofe upon licences to retail ale, 
wine, and fpirituous liquors, though intended, 
perhaps, to fall upon the profits of the retailers, 
are likewife finally paid by the confumers of thofe 
liquors. Such taxes, though called by the fame 
name, and levied by the fame officers and in the 
fame manner with the (lamp-duties above-men- 
tioned upon the transference of property, are how- 
ever of a quite different nature, and fall upon quite 
different funds. 



ARTICLE III. 
Taxes upon the Wages of Labour. 

THE wages of the inferior claffes of work- 
men, I have endeavoured to (how in the firft 
book, are every where neceflarily regulated by 

VOL. in. y two 



3*2 THE NATURE AND CAUSES OF 

BOOK two different circumftances ; the demand for la- 
bour and the ordinary or average price of pro- 
vifioas. The demand for labour, according as 
it happens to be either increafing, ftationary, or 
declining ; or to require an increafing, ftationary, 
or declining population, regulates the fub- 
fiitence of the labourer, and determines in what 
degree it mail be either liberal, moderate, or 
fcanty. The ordinary or average price of pro* 
viiions determines the quantity of money which 
muii be paid to the workman in order to enable 
him, one year with another, to purchafe this 
liberal, moderate, or fcanty fubfiftence. While 
the demand for labour and the price of provisions, 
therefore, remain the fame, a direct tax upon 
the -wags. .of labour can have no other effecl: 
than to raife them fomewh.at higher than the tax. 
Let us fuppofe, for example, that in a particular 
place the demand for labour and the price of 
pifoyiaons were fuch, as to reader ten millings a 
^ week the ordinary wages of labour; and that a 
tax of one-fifth, or four {hillings in the pound, 
was impofed upon wages. If the demand for 
labour and the price of provifions remained the 
fame, it would itill be neceflary that the labourer 
fhould in that place ,earn fuch a fubflftence as 
could be bought only for tea millings a week, or 
that after paying the tax he fhould have tea 
ihillings a week free wages. But in order to leave 
him fuch free wages after paying fuch a tax, the 
price of labour mud in that place ibon rife> not 
to twelve millings a week only, but to. twelve 
and fixpence j that is, ia order to enable him to 



THE WEALTH OF NATIONS. 323 

pay a tax of one-fifth, his wages mud neceffarily CHAP. 
foon rife, not one-fifth part only, but one fourth. 
Whatever was the proportion of the tax, the 
wages of labour mud in all cafes rife, not only 
in that proportion, but in a higher proportion. 
If the tax, for example, was one-tenth, the wages 
of labour mufl neceflarily foon rife, not one- 
tenth part only* but one-eighth. 

A DIRECT tax upon the wages of labour, 
therefore, though the labourer might perhaps 
pay it out of his hand, could not properly be faid 
to be even advanced by him ; at leaft if the de- 
mand for labour and the average price of provi- 
fions remained the fame after the tax as before it. 
In all fuch cafes, not only the tax, but fome- 
thing more than the tax, would in reality be 
advanced by the perfon who immediately em- 
ployed him. The final payment would in dif- 
ferent cafes fail upon different perfons. The 
rife which fuch a tax might occafion in the wages 
of manufacturing labour would be advanced by 
the mailer manufacturer, who would both bef 
entitled and obliged to charge it* with a profit, 
upon the price of his goods* The final payment 
of this rife of wages, therefore, together with 
the additional profit of the mafcer manufacturer, 
would fall upon the confumer. The rife which 
fuch a tax might occafion in the wages of coun- 
try labour would be advanced by the farmer* 
who, in order to maintain the fame number of 
labourers as before, would be obliged to em- 
ploy a greater capital. In order to get back this 
greater capita), together \vith the ordinary prpfits 

y 2 of 



324 THE NATURE AND CAUSES OF 

BOOK of ftock, it would be neceffary that he mould 
retain a larger portion, or, what comes to the 
fame thing, the price of a larger portion, of the 
produce of the land, and confequentty that he 
mould pay lefs rent to the landlord* The final 
payment of this rife of wages,, therefore, would 
in this cafe fall upon the landlord, together with 
the additional profit of the farmer who had ad- 
vanced it. -In all cafes a direct tax upon the 
wages of labour muft, in the long-run, occafion 
both a greater reduction in the rent of land, and 
a greater rife in the price of manufactured goods, 
than would have followed from the proper afieff- 
ment of a fum equal to the produce of the tax, 
partly upon the rent of land, and partly upon 
confuinable commodities. 

IF direct taxes upon the tv ages of labour have 
n6t always occailoned a proportionable rife in thofe 
wages, it is becaufe they have generally occafioned 
a confiderable fall in the demand for labour. 
The declenfion of induftry, the decreafe of employ- 
ment for the poor, the diminution of the annual 
produce of the land and labour of the country, 
have generally been the effects of fuch taxes. In 
confequence of them, however, the price of labour 
mud always be higher than it otherwife would 
have been in the actual ftate of the demand: 
and this enhancement of price, together with the 
profit of thofe who advance it, muft always be 
finally paid by the landlords and confumers. 

A TAX upon the wages of country labour does 
not raife the price of the rude produce of land in 
proportion to the tax ; for the fame reafon tharat 

tax 



\ 

THE WEALTH OF NATION?. 3 2 S 

tax upon the farmer's profit does not raife that C HA P. 
price in that proportion. 

ABSURD and deftru&ive as fuch taxes are, 
however, they take place in many countries f 
In France that part of the taille which is charged 
upon the induftry of workmen and day-labourers 
in country villages, is properly a tax of this 
kind. Their wa.ges are computed according to 
the common rate of the diftrid in which they 
relide, and that they may be as little liable a$ 
pofllble to any over-charge, their yearly gains 
are eftimated at no more than two hundred 
working days in the year *. The tax of each 
individual is varied from year to year according to 
different circumftances, of which the collector 
or the commiflary, whom the intendant appoints 
to afiift him, are the judges. In Bohemia, in 
confequence of the alteration in the fyftem of 
finances which was begun in 1748, a very heavy 
tax is impofed upon the induftry of artificers. 
They are divided into four clafles. The highefl 
clafs pay a hundred florins a year ; which, at 
two-andrtwenty pence halfpenny a florin, amounts 
to 9 /. 7 s. 6d. The fecond clafs are taxed at 
feventy ; the third at fifty ; and the fourth, com r 
prehending artificers in villages, and the lowed 
clafs of thofe in towns, at twenty- five florins f . 

THE recompence of ingenious artifts and of 
men of liberal profeflions, I have endeavoured 
to (how in the firft book, necefiarily keeps a 
certain proportion to the emoluments of inferior 

* Memoircs concernant les Droits, &c. torn, ii, p. 1 08. 
f Id, torn. iii. p. 87. 

Y 3 trades, 




THE NATURE AND CAUSES OF 
trades. A tax upon this recompence, therefore, 
could have no other efFeft than to raife it fome* 
what higher than in proportion ,to the tax. If it 
did not rife in this manner, the ingenious arts and 
the liberal profeffions, being no longer upon a level 
with other trades, would be fo much deferted that 
they would foon return to that level. 

THE emoluments of offices are not, like thofe 
of trades and profeffions, regulated by the free 
competition of the market, and do not, there- 
fore, always bear a juft proportion .to what the 
nature of the employment requires. They are, 
perhaps, in mod countries, ' higher than it re- 
quires ; the perfons who have the adminiftration . 
of government being generally difpofed to re- 
ward both themfelves and their immediate 
dependents rather more than enough. The emo- 
luments of offices, therefore, can in moft cafes 
very well bear to be taxed. The perfons, be- 
fides, who enjoy public offices, efpecially the 
more lucrative, are in all countries the objects 
of general envy ; and a tax upon their emolu- 
ments,, even though it mould be fomewhat 
higher than upon any other fort of revenue, is 
always a very popular tax. In England, for 
example, when by the land-tax every other fort 
of revenue was fuppofed to be affeifed at four 
{hillings in the pound, it was very popular to 
lay a real tax of five millings and fixpence in 
the pound upon the falaries pf offices which ex- 
ceeded a hundred pounds a year ; the penfions of 
the younger branches of the royal family, the 
pay of the officers of the army and navy, and a 

few 



THE WEALTH OF NATIONS. 327 

few others lefs obnoxious to envy, excepted. CHAP. 
There are in England no other direct taxes upon 
the wages of labour. 



ART i,c L E IV. 

Taxes which, it is intended^ fljouldfall indifferently 
upon every different ffccies of Revenue. 

THE taxes which, it is intended, fhould 
fall indifferently upon every different fpecies of 
revenue, are capitation taxes, and taxes upon con- 
fumable commodities. Thefe mult be paid indif- 
ferently from whatever revenue the contributors 
may poflefs; from the rent of their land, from the 
profits of their dock, or from the wages of their 
labour. 



Capitation Taxes. 

CAPITATION taxes, if it is attempted to 
proportion them to the fortune or revenue of each 
contributor, become altogether arbitrary. The 
Hate of a man's fortune varies from day to day, and 
without an inquifition more intolerable than any tax, 
and renewed at lead once every year, can only be 
gueffed at. His affeflinent, therefore, mud in mod 
cafes depend upon the good or bad humour of his 
affcfibrs, and mud,, therefore, be altogether arbi- 
trary and uncertain. 

CAPITATION taxes, if they are proportioned 

not to the fuppofed fortune, but to the rank of 

each contributor, become altogether unequal ; 

V 4 the 



3i8 THE NATURE AND CAUSES OF 

B oo K the degrees of fortune being frequently unequal in 
the fame degree of rank. 

SUCH taxes, therefore, if it is attempted to 
render them equal, become altogether arbitrary 
and uncertain ; and if it is attempted to render 
them certain and i>ot arbitrary, become alto- 
gether unequal. Let the tax be light or heavy, 
uncertainty is always a great grievance. Jn a light 
tax a confiderable degree of inequality may be 
fupported j in a heavy one it is altogether in* 
tolerable. 

IN the different poll-taxes which took place in 
England during the reign of William III. the 
contributors were, the greater part of them, af- 
fcfled according to the degree of their rank ; as 
dukes, marquiffes, earls, yifcqunts, barons, efquires, 
gentlemen, the eldefl and ypungeft fons of peers, 
&c. All fhopkeepers and tradefmen worth more 
than three hundred pounds, that is, the better fort 
of them, were fubjecl: to the fame affeffment ; how 
great foeyer might be the difference in their 
fortunes. Their rank was more confidered than 
their fortune. Several of thofe who in the firft 
poll-tax were rated according to their fuppofed 
fortune, were afterwards rated according to their 
rank. Serjeants, attornies, and pro&ors at law, 
who in the firft poll-tax were affeffed at three fhii- 
lings in the pound of their fuppofed income, 
were afterwards affeffed a^s gentlemen. In the af- 
feffment of a tax which was not very heavy, 
a confiderable degree of inequality had been found 
lefs infupportable than siny degree of uncer- 
tainty. 



THE WEALTH OF NATIONS." 52 

INT the capitation which has been levied in CHAT. 
f ranee without any interruption fmce the be-' 
ginning, .of the prefent century, the highefl 
orders:-, tif people are rated according to their 
rankijy an invariable tariff; the lower orders of 
people, according to what is fuppofed to be 
their -fortune, by an affeffment which varies from 
year to year. The officers of the king's court, 
the judges' and other officers in the fuperior 
courts of juftice, the officers of the troops, &c. 
are afleffed in the firft manner. The inferior 
ranks of people in the provinces are aflefled in 
the fecond. In France the great eafily fubmit 
to a considerable degree of inequality in a tax 
which, fo far as it affe&s them, is not a very 
heavy onej but could not brook the arbitrary 
affeffment of an intendant. The inferior ranks 
of ;people mud, in that country, fuller patiently 
the ufage which their fuperiors think proper to give 
them. 

IN England the different poll-taxes never pro- 
duced the fum which had been expeded from 
them, or which, it was fuppofed they might 
Jiave produced, had they been exa&ly levied. 
In France the capitation always produces the 
fum expected from it. The mild government 
of England, when it afleffed the different ranks 
of people to the poll-tax, contented itfelf with 
what that affeffment happened to -produce; and 
required no compenfation for the lofs which the 
flate might fuftain either by thofe who could not 
pay, or by thofe who would not pay (for there 
were many luch), aad who, by the indulgent 

execution 



330 THE NATURE AND CAUSES OF 

BOOK execution of the law, were not forced to pay. 
The more fevere government of France affeffes 
upon each generality a certain fum, which the 
intendant muft find as he can. If any province 
complains of being affeffed too high, it may, in 
the affeffment of next year, obtain an abatement 
proportioned to the overcharge of the year be- 
fore. But it muft pay in the mean time. The 
intendant, in order to be fure of finding the fum 
affefled upon his generality, was impowered to 
affefs it in a larger fum, that the failure or in- 
ability of fome of the contributors might be 
compenfated by the overcharge of the reft ; and 
till 1765, the fixation of this furplus affelfruent 
was left altogether to his difcretion. In that 
year indeed the council affumed this power to 
itfelf. In the capitation of the provinces, it is 
obferved by the perfectly well-informed author of 
the Memoirs upon the impofitions in France, the 
proportion which falls upon the nobility, and upon 
th'ofe whofe privileges exempt them from the taille, 
is the leaft confiderable. The ' largeft falls upon 
thofe fubjecl: to the taille, who are affefled to the 
capitation at fo much a pound of what they pay to 
that other tax. 

CAPITATION taxes, fo far as they are levied upon 
the lower ranks of people, are direct taxes upon the 
wages of labour, and are attended with all the in- 
conveniences of fuch taxes. 

CAPITATION taxes are levied at little expence ; 
and, where they are rigoroufly exacted, afford 
a very fure revenue to the Hate. It is upon this 
account that ia countries where the eafe, com* 

fort* 



THE WEALTH OF NATIONS. 331 

fort, and fecurity of the inferior ranks of people CHAP, 
are little attended to, capitation taxes are very 
common. It is in general, however, but a 
fmall part of the public revenue, which, in a 
great empire, has ever been drawn from fuch 
taxes ; and the greatcO: fum which they have 
ever afforded, might always have been found in 
fome other way much more convenient to the 
people. 



Taxes upon confumable Commodities. 

THE impoflibility of taxing the people, in 
proportion to their revenue, by any capitation, 
feems to have given occ?ifion to the invention of 
taxes upon confumable commodities. The flate 
noc knowing how to tax, directly and propor- 
tionably, the revenue of its fubjefts, endeavours 
to tax it indirectly by taxing their expence, which, 
it is fuppofed, will in mod cafes be nearly in pro- 
portion to their revenue. Their expence is taxed 
by taxing the confumable commodities upon which 
it is laid out. 

CONSUMABLE commodities are either necefiaries 
or luxuries. 

BY neceflaries I underftand, not only the 
commodities which are indifpenfably neceflary 
for the fupport of life, but whatever the cuftom 
of the country renders it indecent for creditable 
people, even of the loweft order, to be without. 
A linen fhirt, for example, is, flridly fpeaking, 
not a neceflary of life. The Greeks and Romans 

lived, 



3 S 3 THE NATURE AND CAUSES OF 

BOOK lived, I fuppofe, very comfortably, though they 
had no linen. But in the prefent times, through 
the greater part of Europe, a creditable day- 
labourer would be amamed to appear in publiq 
without a linen fhirt, the want of which would 
be fuppofed to denote that difgraceful degree of 
poverty, which, it is prefumed, nobody can 
well fall into without extreme bad conduft, 
Cuftom, in the fame manner, has rendered lea* 
ther fhoes a neceflary of life in England. The 
pooreft creditable perfon of either fex would be 
afhamed to appear in public without them. 
In Scotland, cuftom has rendered them a ne* 
ceflary of life to the ioweft order of men ; but 
not to the fame order of women, who may, 
without any difcredit, walk about bare-footed. 
In France they are necefifaries neither to men 
nor to women ; the Ioweft rank of both fexes ap- 
pearing there publicly without any difcredit, 
fometimes in wooden fhoes, and fometimes bare- 
footed. Under neceflaries, therefore, I com- 
prehend, not only thofe things which nature, 
but thofe things which the eftablifhed rules of 
decency have rendered neceffary to the Ioweft 
rank of people. All other things I calj lux- 
uries j without meaning by this appellation, 
to throw the fmalleft degree of reproach upon 
the temperate ufe of them. Beer and ale, for 
example, in Great Britain, and wine, even in 
the wine countries, I call luxuries. A man of 
$ny rank may, without any reproach, abftain 
totally from tafting fuch liquors. Nature does 

not 




THE WEALTH OF NATIONS. 333 

not render them neceflary for the fupport of life ; 
and Guftom nowhere renders it indecent to live 
without them. 

As the wages of labour are every where regu- 
lated, partly by the demand for it, and partly 
by the average price of the neceflary articles of 
fubfiftence; whatever raifes this average price 
muft neceflarily raife thofe wages, fo that the la- 
bourer may ftill be able to purchafe that quan- 
tity of thofe neceflary articles which the ftate of 
the demand for labour, whether increafing, fta- 
tionary, or declining, requires that he mould 
have*. A tax upon thofe articles neceflarily 
raifes their price fomewhat higher than the 
amount of the tax, becaufe the dealer, who ad- 
vances the tax, mud generally get it back with a 
profit. Such a rax, rnuft, therefore, occafion a rife 
in the wages of labour proportionable to this rife 
of price. 

IT is thus that a tax upon the neceflaries of 
life, operates exactly in the fame manner as a 
direct tax upon the wages of labour. The la- 
bourer, though he may pay it out of his hand, 
cannot, for any confiderable time at lead, be 
properly faid even to advance it. It muft always 
in the long-run be advanced to him by his im- 
mediate employer in the advanced rate of his 
wages. His employer, if he is a manufacturer, 
will charge upon the price of his goods this rife 
of wages, together with a profit ; fo that the final 
payment of the tax, together with this over-charge, 
will fall upon the confumer. If his employer is a 
* See Book I. Chap. 8. 

4 farmer, 



334 T-HE NATURE AMD CAUSES OF 

BOOK farmer, the final payment, together with a lik 

L ___, over-charge, will fall upon the rent of the land- 
~ f ~~ -i i 
lord. 

IT is othefwife with taxes upon what I call 
luxuries ; even upon thofe of the poor. The rife 
in the price of the taxed commodities, will not 
neceffarily occaiion any rife in the wages of la- 
bour. A tax upon tobacco, for example, though 
a luxury of the poor as well as of the rich, will 
not raife wages. Though it is taxed in England 
at three times, and in France at fifteen times its 
original price, thofe high duties feem to have no 
effect upon the wages of labour. The fame thing 
may be faid of the taxes upon tea and fugar ; which 
in England and Holland have become luxuries of 
the lowed ranks of people ; and of thofe upon 
chocolate, which in Spain is faid to have become 
fo. The different taxes which in Great-Britain 
have in the courfe of the prefent century been 
impofed upon fpirituous liquors, are not fuppofed 
to have had any effect upon the wages of labour. 
The rife in the price of porter, occafioned by an 
additional tax of three millings upon the barrel of 
flrong beer, has not raifed the wages of common 
labour in London. Thefe were about eighteen- 
pence and twenty-pence a-day before the tax, and 
they are not more now. 

THE high price of fuch commodities does not 
neceflarily diminifh the ability of the inferior 
ranks of people to bring up families, Upon the 
fober and induftrious poor, taxes upon fuch com- 
modities aft as fumptuary laws, and difpofe them 
cither to moderate, or to refrain altogether from 

the 



THE WEALTH OF . NATIONS. 

the life of fuperfluities which they can no longer c 
cafily afford. Their ability to bring up families, 
in confequence of this forced frugality, inftead 
of being diminifhed, is frequently, perhaps, iu- 
creafed by the tax. It is the fober and induftri- 
ous poor who generally bring up the mod nume- 
rous families, and who principally fupply the 
demand for ufeful labour. Ail the poor indeed 
are not fober and induftrious, and the diflfolute 
and diforderly might continue to indulge them- 
felves in the ufe of fuch commodities after this 
rife of price in the fame manner as before ; with- 
out regarding the diftrefs which this indulgence 
might bring upon their families. Such diforderly 
perfons, however, feldom rear up numerous fa- 
milies , their children generally perifhing from 
neglecr, mifmanagement, and the fcantinefs or 
unwholefoinenefs of their food. If by the ftrength 
of their conflitution they furvive the hardfhips 
to which the bad conduct of their parents expofes 
them ; yet the example of that bad conduct com- 
monly corrupts their morals ; fo that, inftead of 
being ufeful to fociety by their induftry, they 
become public nuifances by their vices and dif- 
orders. Though the advanced price of the lux- 
uries of the poor, therefore, might increafe fome- 
what the diftrefs of fuch diforderly families, and 
thereby diminifli fomewhat their ability to bring 
up children ; it would not probably diminilh much 
the ufeful population of the country. 

ANY rife in the average price of neceflaries, 
unlefs it is compenfated by a proportionable rife 
in the wages of labour, muft neceffarily diminilh 

more 




336 THE NATURE AND CAUSES of 

BOOK more or lefs the ability of the poor to bring tip 
numerous families, and confequently to fupply 
the demand for ufeful labour ; whatever may be 
the ftate of that demand, whether increafing, fta- 
tionary, or declining ; or fuch as requires an in- , 
creating, ftationary, or declining population. 

TAXES upon luxuries have no tendency to raife 
the price of any other commodities except that 
of the commodities taxed. Taxes upon necef- 
faries, by raifing the wages of labour, neceflarily 
tend to raife the price of all manufactures, and 
confequently to diminifh the extent of tfreir fale 
and confumption. Taxes upon luxuries are 
finally paid by the confumers of the commodities 
taxed, without any retribution. They fall in- 
differently upon every fpecies of revenue, the 
wages of labour, the profits of ftock, and the 
rent of land. Taxes upon neceflaries, fo far as 
they affect the labouring poor, are finally paid, 
partly by landlords in the diminiihed rent of 
their lands, and partly by rich confumers, whe- 
ther landlords or others, in the advanced price 
of manufactured goods; and always with a con- 
fiderable over-charge. The advanced price of 
fuch manufactures as are real neceflaries of life, 
and are deftined for the confumption of the 
poor, of coarfe woollens, for example, muft be 
compenfated to the poor by a farther advance- 
ment of their wages. The middling and fu- 
perior ranks of people, if they underftood their 
own intereit, ought always to oppofe all taxes 
upon the neceflaries of life, as well as all direct 
taxes upon the wages of labour. The final pay- 
ment 



THE WEALTH OF NATIONS. 337 

inent of both one and the other falls alto'- , C H A p. 
gether upon themfelves, and always with a con-' 
fiderable over-charge. They fall heavieft upon 
the landlords, who always pay in a double ca* 
pacity ; in that of landlords, by the reduction of 
their rent ; and in that of rich consumers, by the 
mcreafe of their expence* The obfervation of 
Sir Matthew Decker, that certain taxes are, in 
the price of certain goods, fometimes repeated 
and accumulated four or five times, is perfectly 
juft with regard to taxes upon the neceflaries of 
life. In the price of leather, for example, you 
rauft pay, not only for the tax upon the leather 
of your own ihoes, but for a part of that upon 
thofe of the fhoe-rnaker and the tanner. You 
mutt pay too for the tax upon the fait, upon the 
foap, and upon the candles which thofe workmen 
confumc while employed in your fervice, and 
for the tax upon the leather, which the falt- 
maker, the foap-maker, and the candle-maker 
confume while employed in their fervice. 

IN Great Britain, the principal taxes upori 
the neceflaries of life are thofe upon the four 
commodities juft now mentioned, fait, leather, 
foap, and candles. 

SALT is a very ancient and a very imiverfal 
fubjeft of taxation* It was taxed amqng the 
Romans, arid it is fo at prefent in, I believe, 
every part of Europe. The quantity annually 
confumed by any individual is fo fmall, and 
may be purchafcd fo gradually, that nobody, it 
feems to have been thought, could feel very 
fenfibly even a pretty heavy tax upon it. It is 

TOL. in. z irf 



S3 3 - THE NATURE AND CAUSES OF 

BOOK in England taxed at three {hillings and four- 
v * pence a bufhel ; about three times the original 
price of the commodity. In fome other coun- 
tries the tax is ftill higher. Leather is a real 
neceffary of life. The ufe of linen renders foap 
fuch. In countries where the winter nights are 
long, candles are a neceffary inftrument of trade. 
Leather and foap are in Great Britain taxed at 
three half pence a pound ; candles at a penriy ; 
taxes which, upon the original price of leather, 
rriay amount to about eight or ten per cent. ; 
upon that of foap to. about twenty or five and 
twenty per cent. ; and upon that of candles to 
about fourteen or fifteen per cent. ; taxes which, 
though lighter than that upon fait, are ftill very 
heavy. As all thofe four commodities are real 
fieceffaries of life, fuch heavy taxes upon them 
muft increafe fomewhat the expence of the fober 
and induftrious poor, and muft confequently 
raife more or lefs the wages of their labour. 

IN a country where the winters are fo cold as 
in Great Britain, fuel is," during that feafon, in 
the ftricteft fenfe of the word, a neceffary of life, 
not only for the purpofe of dreffmg victuals, but 
for the comfortable fubfiftence of many different 
forts of workmen who work within doors \ and 
coals are the cheaper! of all fuel. The N price of 
fuel has fo important an influence upon that of 
labour, that all over Great Britain manufactures 
have confined themfelves principally to the coal 
counties ; other parts of the country, on account 
of the high price of this neceffary article, not 
being able to work fo cheap. In fome manu- 
factures. 



THE WEALTH OF NATIONS. 339 

faftures, befides, coal is a neceflary inftrument CHAP. 
of trade ; as in thofe of glafs, iron, and all. other 
metals. If a bounty could in any cafe be rea- 
fonable, it might perhaps be fo upon the tranf- 
portation of coals from thofe parts of the coun- 
try in which they abound, to thofe in which they 
are wanted. But the legiflature, inftead of a 
bounty, has impofed a tax of three (hillings and 
three-pence a ton upon coal carried coaftways ; 
which upon mod forts of coal is more than fixty 
per cent, of the original price at the coal pit. 
Coals carried either by land or by inland navi- 
gation pay no duty. Where they are naturally 
cheap, they are confumed duty free: where 
they are naturally dear, they' are loaded with a 
heavy duty. 

SUCH taxes, though they raife the price of 
fubfiflence, and confequently the wages of la- 
bour, yet they afford a considerable revenue to 
government, which it might not be eafy to find 
in any other way. There may, therefore, be 
good reafons for continuing them. The bounty 
upon the exportation of corn, fo far as it tends 
in the aclual flate of tillage to raife the price of 
that neceflary article, produces all the like bad 
effects; and inftead of affording any revenue, 
frequently occafions a very great expence to 
government. The high duties upon the import- 
ation of foreign corn, which in years of mode- 
rate plenty amount to a prohibition ; and the 
abfolute prohibition of the importation either 
of live cattle or of fait provifions, which takes 
place in the ordinary ftate of the law, and which, 

z 2 on 



340 THE NATURE AND CAUSES OF 

B CM} K on account of the fcarcity, is at prefent fufpended 
for a limited time with regard to -Ireland and 
the Britifh plantations, have all had the bad effects 
of taxes upon the neceflaries of life, and produce 
no revenue to government. Nothing feems ne- 
ceflary for the repeal of fuch regulations, but to 
convince the public of the futility of that 
fyftem in confequence of which they have been 
eftablifhed. 

TAXES upon the neceflaries of life are much 
higher in many other countries than in Great 
Britain. Duties upon flour and meal wheft 
ground at the mil), and upon bread when baked 
at the oven, take place in many countries. In 
Holland the money price of the bread confumed 
in towns is fuppofed to be doubled by means of 
fuch taxes. In lieu of a part of them, the people 
who live in the country pay every year fo much 
a head, according to the fort of bread they are 
fuppofed to confume. Thofe who confume 
wheaten bread, pay three guilders fifteen flivers j 
about fix (hillings and nine-pence halfpenny. 
Thefe, and fome other taxes of the fame kind, 
by raifing the price of labour, are faid to have 
ruined the greater part of the mamrfa&ures of 
Holland *. Similar taxes, though not quite fo 
heavy, take place in the Milanefe, in the flates 
of Genoa, in the dutchy of Modena, in the 
dutchies of Parma, Placentia, and Guaftalla, 
and in the ecclefiaftical ftate* A French f author 

* Meraoircs concernafct ks Dtoits, &c. p. 3 TO, 21 1* 
f Lc Iteformateur. 

of 



THE WEALTH OF NATION?. 

of fome note has propofed to reform the finances c 
of his country, by fabftituting in the room of 
the greater part of other taxes, this moft ruinous 
of all taxes. There is nothing fo abfurd, fays 
Cicero, which has not fometitnea been afferted 
by fome philofophers. 

TAXES upon butchers meat are ftill more com* 
mon than thofe upon bread. It may indeed be 
doubted whether butchers meat is any where a 
neceffary of life. Grain and other vegetables, 
with the help of milk, cheefe, and butter, or 
oil, where butter is not to be had, it is known 
from experience, can, without any butchers 
meat, afford the moft plentiful, the moft whole- 
fome, the moft nourifhing, and the moft in- 
vigorating diet. Decency no where requires 
that any man fhould eat butchers meat, as it in 
moft places requires that he fhould wear a linen 
(hirt or a pair of leather fhoes. 

CONSUMABLE commodities, whether necefla- 
ries or luxuries, may be taxed in two different 
ways. The confumer may either pay an annual 
Aim on account of his ufmg or confuming goods 
of a certain kind ; or the goods may be taxed 
while they remain in the hands of the dealer, 
and before they are delivered to the confumer. 
The confumable goods which laft a confiderable 
time before they are confumed altogether, are 
moft properly taxed in the one way. Thofe of 
which the confumption is either immediate or 
more fpeedy, in the other. The coach-tax: 
and plate-tax are examples of the former method 
z 3 of 




342 THE NATURE AND CAUSES OF 

B v K f inipofing : the greater part of the other duties 
of excife and cuftonis, of the latter. 

A COACH may, with good management, laft 
ten or 'twelve years. It might be taxed, once 
for all, before it comes out of the hands of the 
coach-maker. But it is certainly more con- 
venient for the buyer to pay four pounds a year 
for the privilege of keeping a coach, than to 
pay all at once forty or forty-eight pounds ad- 
ditional price to the coach-maker ; or a fum 
equivalent to what the tax is likely to cofl him 
during the time he ufes' the fame coach. A 
fervice x of plate, in the fame manner, may laft 
more than a century. It is certainly eafier for 
the confumer to pay five millings a year for 
every hundred ounces of plate, near one per cent, 
of the value, than to redeem this long annuity 
at five and twenty or thirty years purchafe, 
which would enhance the price at lead five and 
twenty or thirty per cent. The different taxes 
which affect houfes are certainly more conve- 
niently paid by moderate annual payments, than 
by a heavy tax of equal value upon the firft build- 
ing or fale of the houfe. 

IT was the well known propofal of Sir Matthew 
Decker, that all commodities, even thofe of 
which the confumption is either immediate or 
very fpeedy, mould be taxed in this manner ; 
the dealer advancing nothing, but the confumer 
paying a certain annual fum for the licence to 
confume certain goods. The object of his 
fcheme was to promote all the different branches 

of 



THE WEALTH OF NATIONS. 343 

of foreign trade, particularly the carrying trade, c H A p. 
by taking away all duties upon importation and 
exportation, and thereby enabling the merchant 
to employ his whole capital and credit in the pur- 
chafe of goods and the freight of (hips, no part 
of either being diverted towards the advancing 
of taxes. The project, however, of taxing, ia 
this manner, goods of immediate or fpeedy con- 
fumption, feems liable to the four following 
very important objections. Firft, the tax would 
be more unequal, or not fo well proportioned 
to the expence and confumption of the different 
contributors, as in the way in which it is com- 
monly impofed. The taxes upon ale, wine, and 
fpirituous liquors, which are advanced by the 
dealers, are finally paid by the different con- 
fumers exactly in proportion to their refpeclive 
confumption. But if the tax were to be paid by 
purchafing a licence to drink thofe liquors, the 
iober would, in proportion to his- confumption, 
be taxed much more heavily than the drunken 
confumer. A family which exercifed great 
hofpitality would be taxed much more lightly 
than one who entertained 'fewer* guefts. Se- 
condly, this mode of taxation, by paying for an 
annual, Half-yearly, or quarterly licence to con- 
fume certain goods, would diminifn very much 
one of the principal conveniencies of taxes upon 
goods of fpeedy confumption ; the piece-meal 
payment. In the price of three-pence halfpenny, 
which is at prefent paid for a pot of porter, the 
different taxes upon malt, hops, and beer, to- 
gether with the extraordinary profit which the 
z 4 brewer 



344 THE NATURE AND CAUSES OF 

p o o K brewer charges for having advanced them, may 
perhaps amount to about three halfpence. If a 
workman can conveniently fpare thofe three half- 
pence, he buys a pot of porter. If he cannot, 
he contents himfelf with a pint, and, as a penny 
faved is a penny got, he thus gains a farthing 
by his temperance. He pays the tax piece- 
meal, as he can afford to pay it, and when he 
can afford to pay it, and every act of payment 
is perfectly voluntary, and what he can avoid 
if he chufes to do fo. Thirdly, fuch taxes 
would operate lefs as fumptuary laws. When 
jthe licence was once purchafed, whether the 
purchafer drunk much or drunk little, his tax 
would be the fame. Fourthly, if a workman 
were to pay all at once, by yearly, half-yearly, 
or quarterly payments, a tax equal to what he 
at prefent pays, with little or no inconveniency, 
upon all the different pots and pints of porter 
which he drinks in any fuch period of time, the 
fum might frequently diftrefs him very much. 
This mode of taxation, therefore, it feems evi- 
dent, couid never, without the moil grievous 
pppreflion, produce a revenue nearly equal to 
what is derived from the prefent mode without 
any oppreffion. In feveral countries, however, 
commodities of an immediate or very fpeedy 
onfurnption are taxed in this manner. In Hoi* 
land, .people pay fo much a head for a licence to 
idrink tea. I have already mentioned a tax upon 
bread, which, fo far as it is confumed in farm- 
houfes and country villages, i there levied in 
j he fazne manner, 

THI 



THE WEALTH OF NATIONS. $ 

THE duties of excife are impofed chiefly upon G H u ^ 
goods of home produce deftined for home con- 
fumption. They are impofed only upon a few 
forts of goods of the mod general ufe. There 
can never be any doubt either concerning the 
goods which are fubjeft to thofe duties, or 
concerning the particular duty which each fpecies 
of goods are fubjeft to. They fall almoft alto- 
gether upon what I call luxuries, excepting 
always the four duties above mentioned, upon 
fait, foap, leather, candles, and, perhaps, that 
upon green glafs. 

THE duties of cuftoms arc much more ancient 
than thofe of excife. They feem to have been 
called cuftoms, as denoting cuftomary payments 
which had been in ufe from time immemorial. 
They appear to have been originally confidered 
as taxes upon the profits of merchants. During 
the barbarous times of feudal anarchy, mer- 
chants, like all the other inhabitants of burghs, 
were confidered as little better than emancipated 
bondmen, whofe perfons were defpifed, and 
whofe gains were envied. The great nobility, 
who had confented that the king mould tallage 
the profits of their own tenants, were not un- 
willing that he mould tallage like wife thofe of 
an order of men whom it was much lefs their 
intereft to protect. In thofe ignorant times, it 
was not underftood, that the profits of mer- 
chants are a fubjeft not taxable directly ; or that 
the final payment of all fuch taxes muft fall, 
with a confiderable overcharge, upon the coi^ 
Aimers, 

THB 




THE NATURE AND CAUSES OF 

THE gains of alien merchants were looked 
upon more unfavourably than thofe of Engiifh 
merchants. It was natural, therefore, that thofe 
of the former mould be taxed more heavily than 
thofe of the latter. This diftincYion between 
the duties upon aliens and thofe upon Engiifh 
merchants, which was begun from ignorance, 
has been continued from the fpirit of monopoly, 
or in order to give our own merchants an ad- 
vantage both in the home 2nd in the foreign 
market. 

WITH this diflin&ion the ,ancient duties of 
cuiloms were impofed equally upon all forts of 
goods, neceflaries as well as luxuries, goods 
exported as well as goods imported. Why 
fhould the dealers in one fort of goods, it feems 
to have been thought, be more favoured than 
thofe in another ? or why fhould the merchant 
exporter be more favoured than the merchant 
importer ? 

THE ancient cufloms were divided into three 
branches. The firfl, and perhaps the mod an- 
cient of all thofe duties, was that upon wool and 
leather. It feems to have been chiefly or alto- 
gether an exportation duty. When the woollen 
manufacture came to be eftablifhed in England, 
left the king fhould lofe any part of his cufloms 
upon wool by the exportation of woollen cloths, 
a like duty was impofed upon them. The other 
two branches were, firft, a duty upon wine, 
which being impofed, at fo much a ton, was 
called a tonnage $ and, fecondly, a duty upon 
all other goods, which, being impofed at fo 

much 



THE WEALTH OF NATIONS. 547 

much a pound of their fuppofed value, was called c HA p. 
a poundage. In the forty-feventh year of Ed- 4 
ward III. a duty of fixpence in the pound was 
irapofed upon all goods exported and imported, 
except wools, wool- fells, leather, and wines, 
which were fubjecl to particular duties. In the 
fourteenth of Richard II. this duty was raifed 
to one fhilling in the pound ; but three years 
afterwards, it was again reduced to fixpence* 
It was raifed to eightpence in the fecond year 
of Henry IV. j and in the fourth of the 
fame prince, to one milling. From this time 
to the ninth year of "William III. this duty con- 
tinued at one {lulling in the pound. The duties 
of tonnage and poundage were generally granted 
to the king by one and the fame act of parlia- 
ment, and were called the Sub fid y of Tonnage 
and Poundage. The fubfidy of poundage hav- 
ing continued for fo long a time at one milling 
in the pound, or at five per cent. ; a fubfidy 
came, in the language of the cuftoms, to de- 
note a general duty of this kind of five per 
cent. This fubfidy, which is now called the 
Old Subfidy, (till continues to be levied accord- 
ing to the book of rates eftablifhed in the 
twelfth of Charles II. The method of afcer- 
taining, by a book of rates, the value of goods 
fubjecl to this duty, is faid to be older than the 
time of James I. The new fubfidy impofed by 
the ninth and tenth of William III., was an ad- 
ditional five per cent, upon the greater part of 
goods. The one-third and the two-third fub* 
fidy made up between them another five per. 

cent. 



THE NATURE AND CAUSES OF 

BOOK tent, of which they were proportionable parts. 
The fubfidy of 1 747 made a fourth five per cent. 
upon the greater part of goods j and that of 
1759, a fifth ^upon fome particular forts of 
goods. Befidcs thofe five fubfidies, a great va- 
riety of other duties have occafionally been im~ 
pofed upon particular forts of goods, in order 
fometimes to relieve the exigencies of the ilate, 
and fometimes to regulate the trade of the coun- 
try, according to the principles of the mercantile 
fyflem. 

THAT fyflem has come gradually more and 
more into fafhion. The old fubfidy was impofed 
indifferently upon exportation as well as im- 
portation. The four fubfequent fubfidies, as 
Well as the other duties which have fince been 
occafionally impofed upon particular forts of 
goods, have, with a few exceptions, been laid 
altogether upon importation. The greater part 
of the ancient duties which had been impofed 
Upon the exportation of the goods of home 
produce and manufacture, have either been 
lightened or taken away altogether. In mod 
cafes they have been taken away. Bounties have 
even been given upon the exportation of fome 
of them. Drawbacks too, fometimes of the 
whole, and, in mod cafes, of a part of the duties 
which are paid upon the importation of foreign 
goods, have been granted upon their export- 
ation. Only half the duties impofed by the old 
fubfidy upon importation, are drawn back upon 
exportation : but the whole of thofe impofed by 
the latter fubfidies and other impofls are, upon 



THE WEALTH OF NATIONS. 349 

the greater part of the goods, drawn back in the CHAP, 
fame manner. This growing favour of export- ^ 
ation, and difcouragement of importation, have 
fufFered only a few exceptions, which chiefly 
concern the materials of fome manufactures. 
Thefe, our merchants and manufacturers are 
willing mould come as cheap as poflible to 
themfelves, and as dear as poflible to their rivals 
and competitors in other countries. Foreign 
materials are, upon this account, fometimes al- 
lowed to be imported duty free ; Spanifh wool, 
for example, flax and raw linen yarn. The 
exportation of the materials of home produce, 
and of thofe which are the particular produce of 
our colonies, has fometimes been prohibited, 
and fometimes fubje&ed to higher duties. The 
exportation of Englifh wool has been prohibited. 
That of -beaver fkins, of beaver wool, and of 
gum Senega, has been fubje&ed to higher du^ 
ties ; Great Britain, by the conquefl of Canada 
and Saegal, having got almoft the monopoly of 
thofe commodities. 

THAT the mercantile fyftem has not been very- 
favourable to the revenue of the great body of 
the people, to the annual produce of the land 
and labour of the country, I have endeavoured 
to mew in the fourth book of this Inquiry. It 
feems not to have been more favourable to the 
revenue of the fovereign ; fo far at leaft as that 
revenue depends upon the duties of cuftoms. 

IN confequence of that fyftem, the importation 
of feveral forts of goods has been prohibited 
altogether. This prohibition has in fome cafes 

entirely 



350 THE NATURE AND CAUSES OF 

3 < 
V. 



BOOK entirely prevented; and in others has very much 



dimmifhed the importation of thofe commo- 
dities, by reducing the importers to the neceflity 
of fmuggling. It has entirely prevented the 
importation of foreign woollens ; and it has very 
much diminimed that of foreign filks and vel- 
vets. In both cafes it has entirely annihilated 
the revenue of cuftoms which might have been 
levied upon fuch importation. 

THE high duties which have been imppfed 
upon the importation of many different forts of 
foreign goods, in order to difcourage their con- 
fumption in Great Britain, have in many cafes 
ferved only to encourage fmuggling, and in all 
cafes have reduced the revenue of the cuftoms 
below what more moderate duties would have 
afforded. The faying of Dr. Swift, that in the 
arithmetic of th cuftoms two and two, inftcad 
of making four, make fometimes only one, 
holds perfectly true with regard to fuch heavy 
duties, which never could have been impofed 
had not the mercantile fyftem taught us, in 
many cafes, to employ taxation as an inftrumnt, 
not of revenue but of monopoly. 

THE bounties which are fometimes given 
upon the exportation of home produce and 
manufactures, and the drawbacks which are paid 
upon .the re-exportation of the greater part of 
foreign goods, have given occafion to many 
frauds, and t6 a fpecies of fmuggling more 
deftrucYive of the public revenue than any 
other. In order to obtain the bounty or draw- 
back, the gopds, it is well known, are fometimes 
7 Clipped 



THE WEALTH OF NATIONS. 3* * 

{hipped and fent to fea ; but foon afterwards C HA P. 
clandeftinely relanded in fome other part of the 
country. The defalcation of the revenue of 
cuftoms occafioned by bounties and drawbacks > 
of which a great part are obtained fraudulently, 
is very great. The grofs produce of the cuf- 
toms in the year which ended on the 5th of 
January 1755, amounted to 5,068, ooo/. The 
bounties which were paid out of this revenue, 
though in that *year there was no bounty upon 
corn, amounted to 167,8007. The drawbacks 
which were paid upon debentures and certifi- 
cates, to 2,1 56,8007. Bounties and ^drawbacks 
together, amounted to 2,324,6007. In confe- 
quence of thefe deductions the revenue of the 
cuftoms amounted only to 2,743,4007,; from 
which deducting 287,9007. for the expence of 
management in falaries and other incidents, the 
neat revenue of the cuftoms for that year comes 
out to be 2,455,5007. The expence of manage- 
ment amounts in this manner to between five 
and -fix per cent, upon the grofs revenue of the 
cuftoms, and to fomething more than ten per 
cent, upon what remains of that revenue, after 
deducting what is paid away in bounties and 
drawbacks. 

HEAVY duties being impofed upon almoft all 
goods imported, our merchant importers fmuggle 
as much, and make entry of as little as they can. 
Our merchant exporters, on the contrary, make 
entry of more than they export ; fometimes out 
of vanity, and to pafs for great dealers in goods 
which pay no duty ; and fometimes to gain ^t 

bounty 



3?e THE NATURE AND CAUSES OF 

B O OK bounty or a drawback. Our exports, in confe- 
quence of thefe different frauds, appear upon the 
cuftom-houfe-books greatly to overbalance our 
imports, to the unfpeakable comfort of thofe poli- 
ticians who meafure the national profperity by 
what they call the balance of trade. 

ALL goods imported, unlefs particularly ex- 
empted, and fuch exemptions are not very nu- 
merous, are liable to fome duties of cuftoms* 
If any goods are imported not mentioned in th 
book of rates, they are taxed at 4*. g~-^d. for 
every twenty millings value, according to the 
oath of the importer, that is, nearly at five fubfi* 
dies, or five poundage duties. The book of 
Tates is extremely comprehenfive, and enu- 
merates a great variety of articles, many of them 
little ufed, and therefore not well known. It isr 
upon this account frequently uncertain under 
what article a particular fort of goods ought to 
be clafied, and confequently what duty they 
ought to pay. Miftakes with regard to this 
fometimes ruin the cuftomhoufe officer, and fre- 
quently occafion much trouble, expence, and 
vexation to the importer. In point of perfpi- 
cuity, precifion, and diftinctnefs, therefore, the 
duties of cufloms are much infcrigr to thofe of 
cxcife. 

IN order that the greater part of the members 
of any fociety mould contribute to the public 
revenue in proportion to their refpetive expcnce^ 
it does not feem neceffary that every fingle 
article of that expence mould be taxed. The 
revenue which is levied by the duties of excife, 
..? a 



THE WEALTH OF NATIONS. 353 

is fuppofed to fall as equally upon the contfi- CHAP, 
btitors as that which is levied by the duties of 
cuftoms ; and the duties of excife are impofed 
upon a few articles only of the mod general ufe 
and confumption. It has been the opinion of 
many people, that- by proper management, the 
duties of cuftoms might likewife, without any 
lofs to the public revenue, and with great ad- 
vantage to foreign trade, be confined to a few ar- 
ticles only. 

THE foreign articles, of the moft general ufe 
and confumption in Great t Britain j feem at pre- 
fent to confift chiefly in foreign wines and bran* 
dies ; in fome of the productions of America and 
the Weft Indies, fugar, rum, tobacco, cocoa- 
nttts, &c. and in fome of thofe of the Eaft-Indies, 
tea, coffee, china-ware, fpiceries of all kinds, 
feveral forts of piece-goods, &c. Thefe differ- 
ent articles afford, perhaps, at prefent, the greater 
part of the revenue which is drawn from the 
duties of cuftoms. The taxes which at prefent 
fubfift upon foreign manufactures, if you except 
thofe upon the few contained in the foregoing 
enumeration, have the greater paft of them been 
impofed for the purpofe, not of revenue, but of 
monopoly, or to give our own merchants an 
advantage in the home market. By removing 
all prohibitions, and by fubjecting all foreign 
manufactures to fuch moderate taxes* as 'it was 
found from experience afforded upon each 
article the greateft revenue to the public, our 
own workmen might (till have a confiderable 
advantage in the home market, and many ar- 
VOL. in. A A tides* 



354 TftE NATURE AftD CAUSES OF 

B c^p K tides, fbme of which at prefent afford no reverititf 
to government, and others a very inconfiderable 
one, might afford a Very great one. 

HIGH taxes, fometimes by dimimfhing the 
confumption of the taxed commodities, and 
fometimes by encouraging fmuggling, frequently 
afford a fmaller revenue to government than 
what might be drawn from more moderate 
taxes. 

WHIN the diminution of revenue is the effecfc 
of the diminution of confumption, there can be 
but one remedy, and that is the lowering of the 
tax. 

WHEN the diminution of the revenue is the 
efleclr of the encouragement given to fmuggling, 
It may perhaps be remedied in two ways ; either 
by dimini filing the temptation to fmuggle, or by 
increafing the difficulty of fmuggling* The 
temptation to fmuggle can be diminifhed only by 
the lowering of the tax; and the difficulty of 
fmuggling can be increafed only by eflablifhing 
that fyflem of adininiflration which is moft proper 
for preventing it. 

THE excife tews, it appears, I believe, from 
experience, obflrucl: and embarrafs the opera- 
tions of the fmuggler much more effectually 
than thofe of the cufloms. By introducing into 
the cufloms a fyflem of adminiflration as fimilar 
to that of the excife as the nature of the different 
duties will admit, the difficulty of fmuggling 
might be very much increafed. This alteration, 
it has been fuppofed by many people, might very 
eafily be brought about. 

THE 



THE WEALTH OF NATIONS. 35$ 

THE importer ' of commodities liable to any C H A I*. 
duties of cuftomsj it has been faid, might at his 
option be allowed either to carry them to his 
owri private warehoufe, or to lodge them in a 
warehoufe provided either at his own expence or 
at that of the public, bat under the key of the 
cuflomhoufe officer, arid never to be opened but 
in his prefence. If the merchant carried them to 
his own private warehoufe, the duties to be 
immediately paid; and never afterwards to be 
drawn back ; and that warehoufe to be at all 
times fiibjecl: to the vifit and examination of the 
cuftomhoufe officer, in order td afcertain how far 
the quantity contained in it correfponded with 
that for which the duty had been paid. If he 
carried them to the public warehoufe, no duty 
to be paid till they were taken out for home 
confumption. If taken out for exportation, 
to be duty-free; proper fecurity being always 
given that they mould be fo exported. The 
dealers in thofe particular commodities, either 
by wholefale or retail, to be at all times fubject 
to the vific and examination of the cuflomhoufe 
officer; and to be obliged to juflify by proper 
certificates the payment of the duty upon the 
whole quantity contained in their (hops of ware* 
houfes. What are called the excife-duties upon 
rum imported are at prefent levied in this man- 
ner, and the fame fyftem of adminiftration might 
perhaps be extended to all duties upon goods 
imported ; provided always that thofe duties 
were, like the duties of excife, confined to a few 
forts of goods of the moft general ufe and con- 
A A 2 fumptioii. 



35 6 THE NATURE AND CAUSES OF 

BOOK fumption. If they were extended to almoft all 
forts of goods, as at prefent, public warehoufes of 
fufficient extent, could not eafily be provided, and 
goods of a very delicate nature, or of which the 
prefervation required much care and attention, 
could not fafely be trufted by the merchant in any 
warehoufebut his own. 

IF by fuch a fyftem of adminiftration fmuggling 
to any confiderable extent, could be prevented 
even under pretty high duties ; and if every duty 
was occafionally either heightened or lowered ac- 
cording as it was moft likely, either the one way 
or the other, to afford the greateft revenue to the 
ft ate ; taxation being always employed as an inftru- 
ment of revenue and never of monopoly ; it feem& 
not improbable that a revenue, at leaft equal to 
the prefent neat revenue of the cufloms, might be 
drawn from duties upon the importation of only a 
few forts of goods of the moft general ufe and 
eonfumption ; and that the duties of cuftoms might 
thus be brought to the fame degree of fimplicity, 
certainty, and precifion, as thofe of excife. What, 
the revenue at prefent lofes, by drawbacks upon 
the re-exportation of foreign goods which are af- 
terwards relanded and confumed at home, would 
under this fyftem be faved altogether. If to this 
faving, which would alone be very confiderable, 
were added the abolition of all bounties upon the 
exportation of home produce; in all cafes iu 
which thofe bounties were not in reality drawbacks 
of fome duties of excife which had before been 
advanced; it cannot well be doubted but that the 
neat revenue of cuftoms might after an alteration^ 

of 



THE WEALTH OF NATIONS. 357 

of this kind, be fully equal to what it had ever CHAP. 
been before. t ^'^ 

IF by fuch a change of fyftem the public re- 
venue fuffered no lofs, the trade and manufactures 
of the country would certainly gain a very con- 
fiderable advantage. The trade in the commo- 
dities not taxed, by far the greatcft number, 
would be perfectly free, and might be carried on 
to and from all parts of the world with every 
poflible' advantage. Among thofe commodities 
would be comprehended all the neceflades of life, 
and all the materials of manufacture. So far as the 
free importation of the neceffaries of life reduced 
their average money price in the home market, it 
would reduce the money price of labour, but with- 
out reducing in any refpect its real recompence. 
The value of money is in proportion to the 
quantity of the neceffaries of life which it will 
purchafe. That of the neceflaries of life is alto- 
gether independent of the quantity of money 
which can be had for them. The reduction in 
the money price of labour would neceflarily be 
attended with a proportionable one in that of all 
home- manufactures, which would thereby gain 
fome advantage in all foreign markets. The 
price of fome manufactures would be reduced in 
a flill greater proportion by the free importation 
of the raw materials. If raw filk could be im- 
ported from China and Indoftan duty-free, the 
filk manufactures in England could greatly un- 
derfeli thofe of both France and Italy. There 
would be no occafion to prohibit the importa- 
tion of foreign filks and velvets. The cheapnefs 

A A 3 Of 



35* THE NATURE AND CAUSES OF 

JJ o o K of their goods would fecure to our own work- 
men, not only the poffeffion of the home, but 
a very great command of the foreign market. 
Even the trade in the commodities taxed would 
be carried on with much more advantage than at 
prefent. If thofe commodities were delivered 
out of the public warehoufe for foreign ex- 
portation, being in this cafe exempted from all 
taxes, the trade in them would be perfectly free. 
The carrying trade in all forts of goods would 
under this fyftem enjoy every poflible advantage, 
If thofe commodities were delivered out for home- 
confumption, the importer not being obliged to 
advance the tax till he had an opportunity of 
felling his goods, either to fome dealer, or to 
fome confumer, he could always afford to fell 
them cheaper than if he had been obliged to ad- 
vance it at the moment of importation. Under 
the fame taxes, the foreign trade of confumption, 
even in the taxed commodities, might in this 
manner be carried on with much more advantage 
than it can at prefent. 

IT was the object of the famous excife fcheme 
of Sir Robert Walpole to eftablifh, with regard 
to wine and tobacco, a fyftem not very unlike 
that which is here propofed. But though the 
bill which was then brought into parliament, 
comprehended thofe two commodities only; it 
was generally fuppofed to be meant as an in* 
trodu&ion to a more extenfive fcheme of the 
fame kind. Faction, combined with the interefl 
bffmuggling merchants, raifed fo violent, though 
fo unjuft, a clamour againft that bill, that the 

minifter 



THE WEALTH OF NATIONS. 359 

minifter thought proper to drop it ; and from a CHAP, 
dread of exciting a clamour of the fame kind, 
none of his fucceflbrs have dared to refume the 
project. 

THE duties upon foreign luxuries imported for 
home-confumption, though they fometimes fall 
upon the poor, fall principally upon -people of 
middling or more than middling fortune. Such 
are, for example, the duties upon foreign wines, 
upon coffee, chocolate, tea, fugar, &c. 

THE duties upon the cheaper luxuries of home, 
produce deftined for home-confumption, fall pretty 
equally upon people of all ranks in proportion to, 
their refpeftive expence. The poor pay the duties 
upon mak, hops, beer, and ale, upon their own 
confumption : The rich, upon both their own con- 
fumption and that of their fervants. 

THE whole confumption of the inferior ranks 
of people, or of thofe below the middling rank, 
it mutt be obferved, is in every country much 
greater, not only in quantity, but in value, than 
that of the middling and of thofe above the 
middling rank. The whole expence of the in- 
ferior is much greater than that of the fuperior 
ranks. In the firil place, almoft the whole capital 
pf every country is annually 4iftributed among 
the inferior ranks of people, as the wages of 
productive labour. Secondly, a great part of 
the revenue arifmg from {3oth the rent of land 
^nd the profits c-f ftock, is annually diftributed 
among the fame rank, iri the wages and majn- 
fenance of menial fervants, and other unproduc* 
live labourers. Thirdly, fome part of the profit? 
AA 4 oi 



$6o THE NATURE AND CAUSES OF 

BOOK of flock belongs to the fame rank, as a revenue 
arifmg from the employment of their fmall capi- 
tals. The amount of the profits annually made 
by fmall fhopkeepers, tradefmen, and retailers 
of all kinds, is every where very confiderable, 
and makes a very confiderable portion of the 
annual produce. Fourthly and laftly, fome part 
even of the rent of land belongs to the fame 
rank; a confiderable part to thofe who are 
fomewhat below the middling rank, and a fmali 
part even to the lowed rank ; common labourers 
fomedmes poflefling in property an acre or two 
pf land. Though the expence of thofe inferior 
ranks of people, therefore, taking them indi- 
vidually, is very fmall, yet the whole mafs of it, 
taking them colle&ively, amounts always to by 
much the largefl portion of the whole expence of 
the fociety ; what remains, of the annual pro- 
duce of the land and labour of the country for 
the confumption of the fuperior ranks, being al- 
ways much lefs, not only in quantity but in va ? 
Jue. The taxes upon expence, therefore, which 
fall chiefly upon that of the fuperior ranks of 
people, upon the fmaller portion of the annual 
produce, are likely to be much lefs productive 
than either thofe which fall indifferently upon 
the expence of all ranks, or even thofe which fall 
chiefly upon that of the inferior ranks ; than 
either thofe which fall indifferently upon the 
whole annual produce, or thofe which fall chiefly 
upon the larger portion of it. The excife upon 
the materials and manufaclure of home-made 
fermented and fpirituous liquors is accordingly, 

of 



THE WEALTH OF NATIONS. 361. 

of all the different taxes upon expence, by far c H A P. 
the molt productive ; and this branch of the ex- 
cife falls very much, perhaps principally, upon 
the expence of the common people. In the year 
which ended on the jth of July 1775, the grofs 
proJuce of this branch of the excife amounted to 
334i .837 /. 9-r. prf. 

IT mutt always be remembered, however, that 
it is the luxurious and not the neceflary expence 
of the inferior ranks of people that ought ever to 
be taxed. The final payment of any tax upon 
th-ir neceflary expence would fall altogether 
upon the fuperior ranks of people ; upon the 
fmaller portion of the annual produce, and not 
upon the greater. Such a tax mud in all cafes- 
either raife the wages of labour, or leilen the de- 
mand for it. It could not raife the wages of la- 
bour, without throwing the final payment of the 
tax upon the fuperior ranks of people. It could 
not leflen the demand for labour, without leflen- 
ing the annual produce of the land and labour 
of the country, the fund upon which all taxes 
mud be finally paid. Whatever might be the 
date to which a tax of this kind reduced the de- 
mand for labour, it mud always raife wages 
higher than they otherwife would be in that 
date ; and the final payment of this enhancement 
of wages mud in all cafes fall upon the fuperior 
ranks of people. 

FERMENTED liquors brewed, and fpirituous li- 
quors didilled, not for fale but for private ufe, 
are not in Great Britain liable to any duties of 
excite. This exemption, of which the object is 
to fave private families from the odious vifit and 

examination 



$62 THE NATURE AND CAUSES OF 

BOOK examination of the tax-gatherer, occafions th 
burden of thofe duties to fall frequently much 
lighter upon the rich than upon the poor. It is 
not, indeed, very common to diftii for private 
ufe, though it is done fometimes. But in the 
country, many middling and almofl all rich and 
great families brew their own beer. Their ftrong 
beer, therefore, cofts them eight millings a bar- 
rel lefs than it cofts the common brewer, who 
muft have his profit upon the tax, as well as upon 
all the other expence which he advances. Suck 
families, therefore, muft drink their beer at lead 
nine or ten millings a barrel cheaper than any 
liquor of the fame quality can be drank by the 
common people, to whom it is every where more 
convenient to buy their beer, by little and little, 
from the brewery or the alehoufe. Malt, in 
the fame manner, that is made for the ufe of a 
private family, is not liable to the vifit or exa- 
mination of the tax-gatherer; but in this cafe 
the family muft compound at feven millings and 
fixpence a head for the tax. Seven millings and 
fixpence are equal to the excife upon ten bufhels 
of malt ; a quantity fully equal to what all the 
different members of any fober family, men, 
women, and children, are at an average likely 
to confume. But in rich and great families* 
where country hofpitality is much practifed, the 
malt liquors confumed by the members of the 
family make but a fmall part of the confumption 
of the houfe. Either on account of this compo- 
fition, however, or for other reafons, it is not 
near fo common to malt as to brew for private 
ufe. It is difficult to imagine any equitable 

reafon 




THE WEALTH OF NATIONS. 363 

reafon why thofe who either brew or diftil for 
private life, fhould not be fubje to a compq- 
fition of the fame kind. 

A GREATER revenue than what is at prefent 
drawn from all the heavy taxes upon malt, beer, 
and ale, might be railed, it has frequently been 
faid, by a much lighter tax upon malt ; the oppor- 
tunities of defrauding the revenue being much 
greater in a brewery than in a malt-houfe ; and 
thofe who brew for private ufe being exempted from 
all duties or compofition for duties, which is not 
the cafe with thofe who malt for private ufe. 

IN the porter brewery of London, a quarter of 
malt is commonly brewed into more than two 
barrels and a half^ fometimes into three Barrel* 
of porter. The different taxes upon malt amount 
to fix {hillings a quarter ; thofe upon ftrong beer 
and ale to eight (hillings a barrel. In the porter 
brewery, therefore, the different taxes upon malt, 
beer, and ale, amount to between twenty- fix 
and thirty (hillings upon the produce of a quarter 
of malt. In the country brewery for common 
country fale, a quarter of malt is feldom brewed 
into lefs than two barrels of flrong and one bar- 
rel of fmall beer ; frequently into two barrels and 
a half of ftrong beer. The different taxes upon 
fmall beer amount to one (hilling and four-pence 
a barrel In the country brewery, therefore, the 
different taxes upon malt, beer, and ale, feldom 
amount to lefs than twenty-three millings and 
four-pence, frequently to twenty-fix (hillings, 
upon the produce of a quarter of malt. Taking 
the whole kingdom at an average, therefore, 
whole amount of the duties upon malt, beer, 
2 and 



V. 



THE NATURE AND CAUSES OF 

BOOK and ale, cannot be estimated at lefs than twenty-four 
or twenty-five millings upon the produce of a quarter 
of malt. But by taking off all the different dutie^ 
upon beer and ale, and by trippling the malt- tax, or 
by raifing it from fix to eighteen millings upon the 
quarter of malt, a greater revenue, it is faid a might 
be raifed by this fingle tax than what is at prefent 
drawn from all thofe heavier taxes. 



In 1772, the old malt-tax produced 

The additional 
In 1773* ^ e ^ tax P r duced 

The additional 
In I774> the old tax produced 

The additional 
In 1775* the old tax produced 

The additional 



Average of thefe four years 

In 1772, the country excife produced 

The London brewery 
In 1773, the country excife 

The London brewery - 
In 1774? the country excife 

The London brewery 
In I775> the country excife 

The London brewery 



/. j. 
722,023 ii 
356,776 7 
561,627 3 
278,650 15 
624,614 17 

310,745 2 

6 57>357 ~ 
323,785 12 



d. 

II 

95 

n\ 

ri 

54 



12 -J 



958,895 3 A 

1,243,128 5 3 

408,260 7 2f 
1,245,808 3 3 

405,406 17 10^ 

1,246,373 14 54 

320,601 1 8 
1,214,583 6 i 

463,670 7 4 

4)6,547,832 19 2\. 



Average of thefe four years 
To which adding the average malt-tax, or 

The whole amount of thofe different 1 
taxes comes out to be 

But by trippling the malt-tax, or 
raifing it from fix to efghteen 
lings upon the -quarter of malt, 
fingle tax would produce 

A fum which exceeds the foregoing by 



1,636,958 
^958*895 



4 9 
3 



3 

or by") 
m'fliil. I 
It, that T 



M95.853 7 9fJ 



2,876,685 
380,832 



9 - 



THE WEALTH OF NATIONS. 365 

UNDER the old malt-tax, indeed, is compre- CHAP. 
bended a tax of four (hillings upon the hogfhead ^..^.j 
of cyder, and another of ten (hillings upon the 
barrel of mum. In 1774 the tax upon cyder 
produced only 3083 /. 6s. 8 d. It probably fell 
fomewhat ihort of its ufual amount ; all the dif- 
ferent taxes upon cyder having, that year, pro- 
duced lefs than ordinary. The tax upon mum, 
though much heavier, is ftill lefs productive, on 
account of the fmaller confumption of that liquor. 
But to balance whatever may be the ordinary 
ameunt of thofe two taxes ; there is compre- 
hended under what is called The country excife, 
firft the old excife of fix millings and eight- 
pence upon the hogfhead of cyder ; fecondly, a 
like tax of fix millings and eight-pence upon the - 
hogfhead of verjuice j thirdly, another of eight 
millings and nine-pence upon the hogfhead of 
vinegar , and, laftly, a fourth tax of eleven- 
pence upon the gallon of mead or methegiin : 
the produce of thofe different taxes will pro- 
bably much more than counterbalance that of 
the duties impofed, by what is called The an- 
nual malt-tax upon cyder and mum. 

MALT is confumed not only in the brewery of 
beer, and ale, but in the manufacture of low 
wines and fpirits. If the malt -tax were to be 
xaifed to eighteen millings upon the quarter, it 
might be neceflary to make fome abatement in 
the different excifes which are impofed upon 
thofe particular forts of low wines and fpirits of 
which malt makes any part of the materials.. la 
what are called malt fpirits, it makes commonly 

i but 



THE NATURE AND CAUSES OF 

BOOK but a third part of the materials ; the other 

thirds being either raw barley, or one-third 
barley and one-third wheat. .In the diftillery of 
malt fpirits, both the opportunity and the tempt- 
ation to fmuggle, are much greater than either in 
a brewery or in a malt-houfe ; the opportunity* 
on account of the fmaller bulk and greater value 
of the commodity j and the temptation, on 
account of the fuperior height of the duties, 
which amount to 3 s. lo^-d.* upon the gallon of 
fpirits. By increafing the duties upon malt, and 
reducing thofe upon the diftillery, both the op- 
portunities and the temptation to fmuggle would 
be diminifhed, which might occafion a ftill further 
augmentation of revenue. 

IT has for fome time pad been the policy of 
Great Britain to difcourage the confumption of 
fpirituous liquors, on account of their fuppofed 
tendency to ruin the health and to corrupt the 
morals of the common people. According to 
this policy, the abatement of the taxes upon the 
diftillery ought not to be fo great as to reduce, 
In any refpecl, the price of thofe liquors. Spi- 
rituous liquors might remain as dear as ever; 
while at the fame time the wholefome and invi- 
gorating liquors of beer and ale might be con- 
fiderably reduced in their price. The people 
might thus be in part relieved from one of the 

* Though the duties direftly impofed upon proof fpirit* 
amount only to 2t. 6J. per gallon, thefe added to the 
duties upon the low wines, from which they are diliilled, 
amount to $/. iof</. Both low wines and proof fpirits are, 
to prevent frauds, now rated according to what they gauge in 

the walh. 

burden* 



THE WEALTH OF NATIONS. 367 

biirdens of which they at prefent complain the CHAP. 
mod; while at the fame time the revenue might 
be eonfiderably augmented. 

THE objections of Dr. Davenant to this altera- 
tion in the prefent fyftem of excife duties, feem 
to be without foundation. Thofe objections are, 
that the tax, inflead of dividing itfelf as at pre- 
fent pretty equally upon the profit of the malt- 
fter, upon that of the brewer, and upon that of 
the retailer, would, fo far as it affected profit, 
fall altogether upon that of the maltfter; that 
the maltfter could not fo eafily get back the 
amount of the tax in the advanced price of his 
malt, as the brewer and retailer in the advanced 
price of their liquor; and that fo heavy a tax 
upon malt might reduce the rent and profit of 
barley land. 

No tax can ever reduce, for any considerable 
time, the rate of profit in any particular trade, 
which mu(t always keep its level with other 
trades in the neighbourhood. The prefent du- 
ties upon malt, beer, and ale, do not affect -the 
profits of the dealers in thofe commodities, who 
all get back the tax with an additional profit, in 
the enhanced price of their goods. A tax indeed 
may render the goods upon which it is impofed 
fo dear as to diminilh the confumption of them, 
feut the confumption of malt is in malt liquors ; 
and a tax of eighteen (hillings upon the quarter 
of malt could not well render thofe liquors 
dearer than the different taxes, amounting to 
twenty-four or twenty-five fhillings, do at pre* 
fent. Thofe liquors, on the contrary, would 
probably become cheaper, and the confumpcion 

of 




THE NATURE AND CAUSES OF 

of them would be more likely to increafe than to 
diminim. 

IT is not very eafy to underftand why it mould 
be more difficult for the maltfter to get back 
eighteen millings in the advanced price of his 
malt, than it is at prefent for the brewer to get 
back twenty-four or twenty-five, fometimes 
thirty (hillings, in that of his liquor. The 
maltfter, indeed, inftead of a tax of fix {hillings, 
would be obliged to advance one of eighteen 
millings upon every quarter of malt. But the 
brewer is at prefent obliged to advance a tax 
of twenty-four or twenty-five, fometimes thirty 
millings upon every quarter of malt which he 
brews. It could not be more inconvenient for 
the maltfter to advance a lighter tax, than it is 
at prefent for the brewer to advance a heavier 
one. The maltfter doth not always keep in his 
granaries a flock of malt which it will require a 
longer time to difpofe of, than the flock of beer 
and ale which the brewer frequently keeps in his 
cellars. The former, therefore, may frequently 
get the returns of his money as foon as the 
latter. But whatever inconveniency might arife 
to the maltfter from being obliged to advance a 
heavier tax, it could eafily be remedied by grant- 
ing him a few months longer credit than is at pre- 
Jfent commonly given to the brewer. 

NOTHING could reduce the rent and profit of 
barley land which did not reduce the demand 
for barley. But a change of fyftem, which re- 
duced the duties upon a quarter of malt brewed 
into beer and ale from twenty-four and twenty- 
five fhillings to eighteen fnillings, would be 

more 



THE WEALTH OF NATIONS. 359 

more likely to increafe than diminifh that de- C H A p 
mand. The rent and profit of barley land, 
befides, muft always be nearly equal to thofe of 
other equally fertile and equally well cultivated 
land. If they were lefs, fome part of the barley 
land would foon be turned to fome other pur- 
pofe ; and if they were greater, more land would 
foon be turned to the raifmg of barley. When 
the ordinary price of any particular produce of 
land is at what may be called a monopoly price, 
a tax upon it necefifarily reduces the rent and 
profit of the land which grows it. A tax upon 
the produce of thofe precious vineyards, of 
which the xvine falls fo much Ihort of the . effec- 
tual demand, that its price is always above the 
natural proportion to that of the produce of 
other equally fertile and equally well cultivated 
land, would neceffariiy reduce the rent and profit 
of thofe vineyards. The price of the wines 
being already the higheft that could be got for 
the quantity commonly fent to market, it 
could not be raifed higher without diminifli- 
ing that quantity ; and the quantity could not 
be diminifhed without ftill greater lofs, be- 
caufe the lands could not be turned to any other 
equally valuable produce. The whole weight 
of the tax, therefore, would fall upon the renc 
and profit ; properly upon the rent of the vine- 
yard. When it has been propofed to lay any 
new tax upon fugar, our fugar planters have fre- 
quently complained that the whole weight of 
fuch taxes fell, not upon the confumer, but upon 
the producer $ they never having been able to 
rot. m . B u raife 




j 7 o THE NATURE AND CAUSES OF 

BOOK raife the price of their fugar after the tax, higher 
than it was before. The price had, it feems, 
before the tax been a monopoly price ; and the 
argument adduced to ihew that fugar was an im- 
proper fubjeft of taxation, demonftrated, per- 
haps, that it was a proper one ; the gains of 
monopolies, whenever they can be come at, 
being certainly of all fubjecls the mofl proper. 
But the ordinary price of barley has never been a 
monopoly price ; and the rent and profit of 
barley land have never been above their natural 
proportion to thofe of other equally fertile and 
equally well cultivated land. The different 
taxes which have been impofed upon malt, beer, 
and ale, have never lowered the price of barley ; 
have never reduced the rent and profit of barley 
land. The price of malt to the brewer has con- 
ftantly rifen in proportion to the taxes impofed 
upon it; and thofe taxes, together with the 
different duties upon beer and ale, have con- 
itantly either raifed the price, or, what comes 
to the fame thing, reduced the quality of 
thofe commodities to the confumer. The final 
payment of thofe taxes has fallen conilantly 
upon the confumer, and not upon the pro- 
ducer. 

THE only people likely to fuffer by the change 
of fyftem here propofed, are thofe who brew for 
their own private ufe. But the exemption, 
which this fuperior rank of people at prefent 
enjoy, from very heavy taxes which are paid by 
the poor labourer and artificer, is furely molt 
unjuft and unequal, and ought to be taken away, 

everv 



THE WEALTH OF NATIONS. 371 

even though this change was never to take place. c H A P. 
It has probably been the intereft of this fuperior 
order of people, however, which has hitherto 
prevented a change of fyftem that could not well 
fail both to increafe the revenue and to relieve 
the people. 

BESIDES fuch duties as thofe of cuftoms and 
excife above-mentioned, there are feveral others 
which affeft the price of goods more unequally 
and more indirectly. Of this kind are the duties 
which in French are called Peages, which in old 
Saxon times were called the Duties of Paflage, and 
which feem to have been originally eftablifhed 
for the fame purpofe as our turnpike tolls, or the 
tolls upon our canals and navigable rivers, for 
the maintenance of the road or of the naviga* 
tion. Thofe duties, when applied to fuch pur- 
pofes, are mod properly impofed according to 
the bulk or weight of the goods. As they were 
originally local and, provincial duties, applicable 
to local and provincial purpofes, the adminifira-i 
tion of them was in mod cafes entrufled to the 
particular town, parifh, or lordfhip, in which 
they were levied j fuch communities being in 
fome way or other fuppofed to be accountable 
for the application* The fovereign> who is alto- 
gether unaccountable, has in many countries 
affume'd to himfelf the adminiflration of thofe 
duties; and though he has in fnofl cafes en- 
hanced very much the duty, he has in many 
entirely neglected the application. If the turn- 
pike tolls of Great Britain mould ever become 
one of th reiburces of government, we may 
B B 2 learri, 



37 2 THE NATURE AND CAUSES OF 

BOOK learn, by the example of many other nadons, 
what would probably be the confequence. Such 
tolls no doubt are finally paid by the confurner ; 
but the confumer is not taxed in proportion to 
his expence, when he pays, not according to the 
value, but according to the bulk or weight, of 
what he confumes. When fuch duties are im- 
pcfed, not according to the bulk or weight, but 
according to the fuppofed value of the goods, 
they become properly a fort of inland cuftoms or 
excifes, which obftrucl: very much the mod im- 
portant of all branches of commerce, the interior 
commerce of the country. 

IN fonie finall flates duties fimilar to thofc 
palfage duties are irnpofed upon goods carried 
acrofs the territory, either by land or by water, 
from one foreign country to another. Thefe are 
in fome countries called tranfit-duties. Some of 
the little Italian Hates which are fituated upon 
the Po, and the rivers which run into it, derive 
fome revenue from duties of this kind, which are 
paid altogether by foreigners, and which, per- 
haps, are the only duties that one flate can 
impofe upon the fubje&s of another, without 
obftrucling in any refpecb the induftry or com- 
merce of its own. The moft important tranfit- 
duty in the world is that levied by the king of 
Denmark upon all merchant fliips which pals 
through the Sound. 

SUCH taxes upon luxuries as the greater part 
of the duties of cuftoms and excife, though thej 
all fall indifferently upon every different fpecies 
of revenue, and are paid finally, or without any 

retribution^ 



THE WEALTH OF NATIONS. 3/3 

retribution, by whoever confumes the commo- CHAP, 
dities upon which they are impofed, yet they do 
not always fall equally or proportionally upon 
the revenue of every individual. As every man's 
humour regulates the degree of his confumption, 
every man contributes rather according to his 
humour than in proportion to his revenue ; the 
profufe contribute more, the parfimonious lefs, 
than their proper proportion. During the mi* 
nority of a man of great fortune, he contributes 
commonly very little, by his confumption, to- 
wards the fupport of that ftate from whofe pro* 
tection he derives a great revenue, Thofe who 
live in another country contribute nothing by 
their confumption, towards the fupport of the 
government of that country, in which is fituated 
the fource of their revenue. If in this latter 
country there fliould be no land-tax, nor any 
confiderable duty upon the transference either of 
moveable or immoveable property, as is the 
cafe in Ireland, fuch ab fen tees may derive a great 
revenue from the protection of a government to 
the fupport of which they do not contribute a 
fingle milling. This inequality is likely to be 
greateft in a country of which the government is 
in fome refpecls fubordinate and dependeat 
upon that of fome other. The people who pof- 
fefs the mod extenfive property in the depend- 
ent, will in this cafe generally chufe to live in 
the governing country. Ireland is precifely in 
this fituation, and we cannot therefore wonder 
that the propofal of a tax upon abfentees fhould 
be fo very popular in that country. It might^ 
SB 3 perhaps. 



574 THE NATURE AND CAUSES OF 

BOOK perhaps, be a little difficult to afcertain either 
what fort, or what degree of abfence would fub- 
jecl a man to be taxed as an abfentee, or at what 
precife time the tax mould either begin or end. 
If you except, however, this very peculiar fitua- 
tion, any inequality in the contribution of indi- 
viduals, which can arife from fuch taxes, is much 
more than compenfated by the very circumftance 
which occafions that inequality ; the circum- 
ftance that every man's contribution is alto- 
gether voluntary $ it being altogether in his 
power either to confume or not to confume the 
commodity taxed. Where fuch taxes, therefore, 
are properly aiTefled and upon proper commodi- 
ties, they are paid with lefs grumbling than any 
other. When they are advanced by the mer- 
chant or manufacturer, the confumer, who finally 
pays them, foon comes to confound them with 
the price of the commodities, and almoft forgets 
that he pays any tax. 

SUCH taxes are or may be perfectly certain, or 
may be aifefled fo as to leave no doubt concern- 
ing either yrhat ought to be paid, or when it 
ought to be paid ; concerning either the quan- 
tity or the time of payment. Whatever uncer- 
tainty there may fometimes be, either in the 
duties of cuftoms in Great Britain, or in other 
duties of the fame kind in other countries, it 
cannot arife from the nature of thofe duties > but 
from the inaccurate or unfkilful manner in which 
the law that impofes them is exprefiTed. 

TAXES upon luxuries generally are, and aU 
ways may be, paid piece-meal, or in proportion 

as 



THE WEALTH OF NATIONS. 375 

as the contributors have occafion to purchafe the c H A p. 
goods upon which they are impofed. In the 
time and mode of payment they are, or may be, 
of all taxes the mod convenient. Upon the 
whole, fuch taxes, therefore, are, perhaps, as 
agreeable to the three firft of the four general 
maxims concerning taxation, as any other. They 
offend in every refpcdl againft the fourth. 

SUCH taxes, in proportion to what they bring 
into the public treafury of the (late, always take 
out or keep out of the pockets of the people 
more than almoft any other taxes. They feem to 
do this in all the four different ways in which it is 
pofiible to do it. 

FIRST, the levying of fuch taxes, even when, 
impofed in the mod judicious manner, requires 
a great number of cuflomhoufe and excife 
officers, whofe falaries and perquifites are a real 
tax upon the people, which brings nothing into 
the treafury of the ftate. This expence, how- 
ever, it mufl be acknowledged, is more moderate 
in Great Britain than in mod other countries. 
In the year which ended on the fifth of July 1775, 
the grofs produce .of the different duties, under 
the management of the commiflioners of excife 
in England, amounted to 5,507,3087. 18 s. %\d. 
which was levied at an' expence of little more 
than five and a half per cent. From this grofs 
produce, however, there muft be deducted what 
was paid away in bounties and drawbacks 
upon the exportation of excifeable goods, 
will reduce the neat produce bejow five 
B B 4 millions* 



37ff THE NATURE AND CAUSES OF 

BOOK millions*. The levying of the fait duty, and 
excife duty, but under a different management, 
is much more expenfive. The neat revenue of 
the cuftoms does not amount to two millions 
and a half, which is levied at an expence of 
more than ten per cent, in the falaries of 
officers,, and other incidents. But the perqui- 
fites of cuftomhoufe officers are every where 
much greater than their falanes ; at fome ports 
more than double or triple thofe falanes. If the 
falaries of officers, and other incidents, therefore, 
amount to more than ten per cent, upon the 
neat revenue of the cuftoms ; the whole expence 
of levying that revenue may, amount, in falaries 
and perquifites together, to more than twenty or 
thirty per cent. The officers of excife receive 
few or no perquifites : and the adminiftration of 
that branch of the revenue being of more recent 
eftablimment, is in general lefs corrupted than 
that of the cuftoms, into which length of time 
has introduced and authorifed many abufes. By 
charging upon malt the whole revenue which 
is at prefent levied by the different duties upon 
malt and malt liquors, a faving, it is fuppofed, 
of more than fifty thoufand pounds might be 
made in the annual expence of the excife. By 
confining the duties of cuftoms to a few forts of 
goods, and by levying thofe duties according to 
the excife laws, a much greater faving might 

* The neat produce of that year, after deducting all cx- 
pencts and allowances, amounted to 4,975,6527. 19*. 6</. 

probably 



THE WEALTH OF NATIONS. 377 

probably be made in the annual expence of the c H A p. 
cuftoms. 

SECONDLY, fuch taxes necefiarily occafion 
fome obftruction or difcouragement to certain 
branches of induftry. As they always raife the 
price of the commodity taxed, they fo far dif- 
courage its confumption, and confequently its 
production. If it is a commodity of home 
growth or manufacture, lefs labour comes to be 
employed in raifmg and producing it- If it is a 
foreign commodity of which the tax increafes 
in this manner the price, the commodities of 
the fame kind which are made at home may 
thereby, indeed, gain fome advantage in the 
home market, and a greater quantity of do- 
meftic induftry may thereby be turned toward 
preparing them. But though this rife of price 
in a foreign commodity may encourage do- 
meflic induftry in one particular branch, it 
neceflarily difcourages that induftry in almoft 
every other. The dearer the Birmingham ma- 
nufacturer buys his foreign wine, the cheaper he 
neceflfarily fells that part of his hardware with 
which, or, what comes to the fame thing, with 
the price of which he buys it. That part of his 
hardware, therefore, becomes of lefs value to 
him, and he has lefs encouragement to work 'at 
it. The dearer the confumers in one country 
pay for the furplus produce of another, the 
cheaper they neceffarily fell that part of their 
own furplus produce with which, or, what comes 
to the fame thing, with the price of which they 
buy it. Tha,t part of their own furplus produce 

becomes 




578 THE NATURE AND CAUSES OF 

BOOK becomes of lefs value to them, and they have 
lef$ encouragement to increafe its quantity, . All 
taxes upon confumable commodities, therefore, 
tend to reduce the quantity of productive labour 
below what it otherwife would be, either in 
preparing the commodities taxed, if they are 
home commodities ; or in preparing thofe with 
which they are purchafed, if they are foreign 
commodities. Such taxes too, always alter, mor$ 
or lefs, the natural dire&ion of national induftry, 
and turn it into a channel always different from, 
an4 generally lefs advantageous than that in which 
it would have run of its own accord. 

THIRDLY, the hope of evading fuch taxes by 
fmuggling gives frequent occafion to forfeitures 
and other penalties, which entirely ruin the 
imuggler ; a perfon who, though no doubt highly 
blameable for violating the laws of his country, 
is frequently incapable of violating thofe of na- 
tural juftice, and would have been, in every 
refpeft, an excellent citizen, had not the laws 
of his country made that a crime which nature 
never meant to be fo. In thofe corrupted go- 
vernments where there is at lead a general fuf- 
picion of much unneceflary expence, and great 
mifapplication of the public revenue, the laws 
'which guard it are little refpe&ed. Not many 
people are fcrupulous about fmuggling, when, 
without perjury, they can find any eafy and fafe 
opportunity of doing fo. To pretend to have 
any fcruple about buying fmuggled goods, though 
a manifeft encouragement to the violation of the 
teveiiue laws, anxl tq the perjury which almoft 

always 



THE WEALTH OF NATIONS, 
always attends it, would in moft countries be 
regarded as one of thofe pedantic pieces of hy- 
pocrify which, inftead of gaming credit with any 
body, ferve only to expofe the perfon who affefts 
to practife them, to the fufpicion of being a 
greater knave than moft of his neighbours. By 
this indulgence of the public, the fmuggler is 
often encouraged to continue a trade which he 
is thus, taught to confider as in fome meafure in- 
nocent ; and when the feverity of the revenue 
laws is ready to fall upon him, he is frequently 
difpofed/ to defend v/ith violence, what he has 
been accuftomed to regard as his juft property. 
From being at firft, perhaps, rather imprudent 
than crhtunal, he at lad too often becomes one 
of the hardieft and rnoft determined violators of 
the laws of fociety. By the ruin of the fmug- 
gler, his capital, which had before been em- 
ployed in maintaining productive labour, is 
abforbed either in the revenue of the flate or in 
that of the revenue officer, and is employed in 
maintaining unproductive, to the diminution of 
the general capital of the fociety, and of the 
ufeful induftry which it might otherwife have 
maintained. 

FOURTHLY, fuch taxes, by fubje&ing at leaft 
the dealers in the taxed commodities to the 
frequent vifits and odious examination of the 
tax-gatherers, expofe them fometimes, no doubt, 
to fome degree of oppreflion, and always to 
much trouble and vexation ; and though vex- 
as has already been faid, is not ftridly 

fpeaking 




THE NATURE AND CAUSES OF 
BOOK fpealdng expence, it is certainly equivalent td 
the expence at which every man would be willing 
to redeem himfelf from it. The laws of excife, 
though more effectual for the purpofe for which 
they were inlHtuted, are, in this refpeft, more 
vexatious than thofe of the cuftoms. When a 
merchant has imported goods fubjecl: to certain 
duties of cuftoms, when he has paid thofe 
duties, and lodged the goods in his warehoufe, 
he is not in moft cafes liable to any further 
trouble or vexation from the cuftomhoufe officer. 
It is otherwife with goods fubject to duties of 
excife. The dealers have no refpite from the 
continual vifits and examination of the excife 
officers. The .duties of excife are, upon this 
account, more unpopular than thofe of the 
cufloms -, and fo are the officers who levy them. 
Thofe officers, it is pretended, though in general, 
perhaps, they do their duty fully as well as thofe 
of the cufloms ; yet, as that duty obliges them 
to be frequently very troublefome to fome of 
their neighbours, commonly contract a certain 
hardnefs of character which the others frequent- 
ly have not. This obfervation, however, may 
very probably be the mere fuggeftion of frau- 
dulent dealers, whofe fmuggling is either pre- 
vented or detected by their diligence. 

THE inconveniencies, however, which are, 
perhaps, in fome degree infeparable from taxes 
upon confumable commodities, fall as light upon 
the people of Great Britain as upon thofe of any 
other country of which the government is nearly 

as 



THE WEALTH OF NATIONS. 3t 

as expenfive. Our flate is not perfect, and might CHAP. 
be mended ; but it is as good or better than that 
of mod of our neighbours. 

IN confequence of the notion that duties upon 
confumable goods were taxes upon the profits 
of merchants, thofe duties have, in fome coun- 
tries, been repeated upon every fuccefiive fale of 
the goods. If the profits of the merchant im- 
porter or merchant manufacturer were taxed, 
equality feemed to require that thofe of all the 
middle buyers, who intervened between either 
of them and the confumer, Ihould likewife be 
taxed. The famous Alcavala of Spain feems to 
have been eftablimed upon this principle. It 
was at firfl a tax of ten per cent., afterwards of 
fourteen per cent., and is at prefent of only fix 
per cent, upon the fale of .every fort of property, 
whether moveable or immoveable ; and it is re- 
peated every time the property is fold *. The 
levying of this tax requires a multitude of re- 
venue officers fufrkient to guard the tranfporta- 
tion of goods, not only from one province to 
another, but from one mop to another. It fub- 
jects, not only the dealers in fome forts of goods, 
but thofe in all forts, every farmer, every ma- 
nufacturer, every merchant arid fhopkeeper, to 
the continual vifits and examination of the tax- 
gatherers. Through the greater part of a coun- 
try in which a tax of this kind is eflablifhed, 
nothing can be produced for diftant fale. The 
produce of every part of the country muft be 

* Memoircs concernant les Druits,&c. torn. i. p. 455. 

propor* 



3 S2 THE NATURE AND CAUSES OF 

BOOK proportioned to the confumption of the neigh^ 
bourhood. It is to the Alcavala, accordingly, 
that Uflaritz imputes the ruin of the manufac- 
tures of Spain. He might have imputed to it 
likewife the declenfion of agriculture, it being 
impofed not only upon manufactures, but upon 
the rude produce of the land. 

IN the kingdom of Naples there is a fimilar 
tax of three per cent, upon the value of all con- 
tracts, and confequently upon that of all con- 
tracts of fale. It is both lighter than the Spanifh 
tax, and the greater part of towns and parifhes 
are allowed to pay a compofition in lieu of it* 
They levy this compofition in what manner they 
pleafe, generally in a way thet gives no inter- 
ruption to the interior commerce of the place. 
The Neapolitan tax, therefore, is not near fo 
ruinous as the Spanifh one. 

THE uniform fyftem of taxation, which, with 
a few exceptions of no great confequence, takes 
place in all the different parts of the united 
.Kingdom of Great Britain, leaves the interior 
commerce of the country, the inland and coaft- 
ing trade, almofl intirely free. The inland trade 
is almofl perfectly free, and the greater part of 
goods may be carried from one end of the king- 
dom to the other, without requiring any permit 
or let-pafs, without being fubject to queflion, 
vifit, or examination from the revenue officers* 
There are a few 1 exceptions, but they are fuch 
as can give no interruption to any important 
branch of the inland commerce of the country. 
Goods carried coaftwife, indeed, require certifi- 
i catti 



THE WEALTH OF NATIONS. 383 

cates or coaft-cockets. If you except coals, C HA P. 
however, the reft are almoft all duty free. This 
freedom of interior commerce, the effect of the 
uniformity of the fyftem of taxation, is perhaps 
one of the principal caufes of the profperity of 
Great Britain ; every great country being necef- 
farily the beft and moft extenfive market for ths 
greater part of the productions of its own in- 
duftry. If the fame freedom, in confequence of 
the fame uniformity, could be extended to Ire- 
land and the plantations, both the grandeur of 
the ftate and the profperity of every part of the 
empire, would probably be ftill greater than at 
J>refent. 

IN France, the different revenue laws which' 
take place in the different provinces require a 
multitude of revenue-officers to ^furround, not 
only the frontiers of the kingdom, but thofe of 
almoft each particular province, in order either 
to prevent the importation of certain goods, of 
to fubject it to the payment of certain duties, tp 
the no fmall interruption of the interior com- 
merce of the country. Some provinces are al- 
lowed to compound for the gabelle or falt-tax. 
Others are exempted from it altogether. Some 
provinces are exempted from the exclufive fale 
of tobacco, which the farmers-general enjoy 
through the greater part of the kingdom. The 
aids, which correfpond to the excife in England, 
are very different in different provinces. Some 
provinces are exempted from them, and, pay a 
compofition or equivalent. In thofe in which 
they take place and are in farm, there are many 

locaX 




THE NATURE Alto CAUSES <3F 
local duties which do not extend beyond a par* 
ticular town or diftricl:. The Traites, which 
correfpond to our cuftoms, divide the kingdom 
into three great parts ; firft, the provinces fub* 
jecl to the tarif of 1664, which are called the 
provinces of the five great farms, and under 
which are comprehended Picardy, Normandy, 
and the greater part of the interior provinces of 
the kingdom ; fecondly, the provinces fubjeft 
to the tarif of 1667, which are called the pro* 
vinces reckoned foreign, and under which are 
comprehended the greater part of the frontier pro- 
vinces ; and, thirdly, thofe provinces which are 
faid to be treated as foreign, or which, becaufe 
they are allowed a free commerce with foreign 
countries, are in their commerce with the other 
provinces of France fubjecled to the fame duties 
as other foreign countries. Thefe are Alface, the 
three bifhopricks of Metz, Toul, and Verdun, and 
the three cities of Dunkirk, Bayonne, and Mar* 
feilles. Both in, the provinces of the five great 
farms (called fo on account of an ancient divifion 
of the duties of cuftoms into five great branches, 
each of which was originally the fubjecl of a par* 
ticular farm, though they are now all united into 
one), and in thofe which are faid to be reckoned 
foreign, there are many local duties which do not 
extend beyond a particular 'town or diftricl:. 
There are fome fuch evert in the provinces which 
are faid to be treated as foreign, particularly in 
the city of Marfeilles. It is unneceffary to ob- 
ferve how much, both the reflraims upon the 
interior commerce of the country, and the 

number 



THE WEALTH OF NATIONS. 3^5 

number of the revenue officers mud be multi- C H & P. 
plied, in order to guard the frontiers of thofe dif- 
ferent provinces and diftricts,' which are fubject to 
fuch different fyilems of taxation. 

OVER and above the general reftraints arifing 
from this complicated fyftem of revenue laws, 
the commerce of wine, after corn perhaps the 
mod important production of France, is in the 
greater part of the provinces fubjecl: to particular 
reftraints, arifing from the favour which has been 
fhewn to the vineyards of particular provinces 
and diftricls, above thofe of others. The pro- 
vinces mod famous for their wines, it will be 
found, I believe, are thofe in which the trade in 
that article is fubjecl to the feweft reftraints of 
this kind. The extenfive market which fuch 
provinces enjoy, encourages good management 
both in the cultivation of their vineyards, and in 
the fubfequent preparation of their wines. 

SUCH various and complicated revenue laws 
are not peculiar to France. The little dutchy of 
Milan is divided into fix provinces, in each of 
which there is a different fyftem of taxation with 
regard to feveral different forts of confurnable 
goods. The ftill fmaller territories of the duke 
of Parma are divided into three or four, each of 
which has, in the fame manner, a fyftem of its 
own. Under fuch abfurd management, nothing 
but the great fertility of the foil and happinefs of 
the climate could preferve fuch countries from 
foon relapfmg into the lowed ftate of poverty and 
barbarifm. 

VOL. in. c c TAXES 




THE NATURE AND CAUSES OF 

TAXES upon confumable commodities may 
either be levied by an administration of which 
the officers are appointed by government and are 
immediately accountable to government, of 
which the revenue muft in this cafe vary from 
year to year, according to the occafional varia- 
tions in the produce of the tax j or they may be 
let in farm for a rent certain, the farmer being 
allowed to appoint his own officers, who, though 
obliged to levy the tax in the manner directed by 
the law, are under his immediate infpeclion, and 
are immediately accountable to him. The beft and 
moil frugal way of levying a tax can never be by 
farm. Over and above what is neceffary for 
paying the ftipulated rent, the falaries of the 
officers, and the whole expence of adminift ration, 
the farmer muft always draw from the produce of 
the tax a certain profit proportioned at leaft to 
the advance which he makes, to the riik which 
he runs, to the trouble which he is at, and to .the 
knowledge and ikili which it requires to manage 
fo very complicated a concern. Government, 
by eftablifhing an adminiftration under their own 
immediate infpeclion, of the fame kind with that 
which the farmer eftablifhes, might at lead fave 
this profit, which is almoft always exorbitant. To 
farm any confiderabie branch of the public re- 
venue, requires either a great capital or a great 
credit j circumflances which would alone reftrain' 
the competition for fuch an undertaking to a 
very final I number of people. Of the few who 
have this capital or credit, a Hill fmaller number 
have ^the neceilary knowledge or experience j an- 
i other 



THE WEALTH OF NATIONS. 387 

other circumftance which reftrains the cotnpeti- CHAP. 
tioh dill further; The very few, who are in con- 
dition to" become Competitors, find it more for 
their intereft to combine together ; to become co 
partners inftead of competitors, and when the 
farm is fet up to auction, to offer no rent, but 
what is much below the real value. In countries 
where the public revenues are in farm, the 
farmers are generally the mod opulent people. 
Their wealth would alone excite the public indig- 
nation, and the vanity which almofl always 
accompanies fuch upftart fortunes, the fooliflr 
oftentation with which they commonly difplay that 
wealth, excite that indignation flill more. 

THE farmers of the public revenue never find 
the laws too fevere, which punifh any attempt ta 
evade the payment of a tax. They have no 
bowels for the contributors, who are not their 
fubjefts, and whofe univerfal bankruptcy, if it 
mould happen the day after their farm is expired, 
would not much affect their interefh In the 
greateft exigencies of the flate, when the anxiety 
of the fovereign for the exact payment of his re* 
venue is neceflarily the greateft, they feldom fail 
to complain that without laws more rigorous! 
than thofe which actually take place, it will be 
impoffible for them to pay even the ufual rent. 
In thofe moments of public diftrefs their de- 
mands cannot be difputed. The revenue laws, 
therefore, become gradually more and more 
fevere. The moft fanguinary are always to be 
found in countries where the greater part of the 
public revenue is in farm. The mildeftj in 
, c c 2 countries 




THE NATURE AND CAUSES OF 

countries where it is levied under the immediate 
infpection of the fovereign. Even a bad fove- 
reign feels more companion for his people than 
can ever be expected from the farmers of his re- 
venue. He knows that the permanent grandeur 
of his family depends upon the profperity of his 
people, and he will never knowingly ruin that 
profperity for the fake of any momentary intereft 
of his own. It is otherwife with the farmers of 
his revenue, whofe grandeur may frequently be 
the effect of the ruin, and not of the profperity of 
his people. 

A TAX is fometimes, not only farmed for a 
certain rent, but .the farmer has, befides, the 
monopoly of the commodity taxed. In France, 
the duties upon tobacco and fait are levied in this 
manner. In fuch cafes the farmer, inftead of 
one, levies two exorbitant profits upon the peo- 
ple ; the profit of the farmer, and the dill more 
exorbitant one of the monopolift. Tobacco 
being a luxury, every man is allowed to buy or 
not to buy as' he chufes. But fait being a necef- 
fary, every man is obliged to buy of the farmer 
a certain quantity of it ; becaufe, if he did not 
buy this quantity of the farmer, he would, it is 
prefumed, buy it of fome fmuggler. The taxes 
upon both commodities are exorbitant. ' The 
temptation to fmuggle confequently is to many 
people irrefiftible, while at the fame time the 
rigour of the law, and the vigilance of the farm- 
er's officers, render the yielding to that tempta- 
tion almoft certainly ruinous. - The fmuggling 
of fait and tobacco fends every year feveral 

hundred 



THE WEALTH OF NATIONS. 

hundred people to the gallies, befides a very con- 
fiderable number whom it fends to the gibbet. 
Thofe taxes levied in this manner yield a very 
considerable revenue to government. In 1767, 
the farm of tobacco was let for twenty-two 
millions five hundred and forty-one thoufand two 
hundred and feventy-eight livres a year. That 
of fait, for thirty-fix millions four hundred and 
ninety-two thoufand four hundred and four livres. 
The farm in both cafes was to commence in 
1768, and to laft for fix years. Thofe who con- 
fider the blood of the people as nothing in com- 
parifon with the revenue of the prince, may per- 
haps approve of this method of levying taxes. 
Similar taxes and monopolies of fait and tobacco 
have been eftablifhed in many other countries ; 
particularly in the Auftrian and Pruflian domi- 
nions, and in the greater. part of the dates of 
Italy. 

IN* France, the greater part of the actual re- 
venue of the crown is derived from eight different 
fources ; the taille, the capitation, the two ving- 
tiemes, the gabelles, the aides, the traites, the 
domaine, and the farm of tobacco. The five 
lad are, in the greater part of the provinces, 
under farm. The three fir ft are every where 
levied by an adminiftration under the immediate 
infpection and direction of government, and it is 
univerfally acknowledged that in proportion to 
what they take out of the pockets of the people, 
they bring more into the treafury of the prince 
than the other five, of which the adminiftration 
is much more wafteful and expsnfive, 
c c 3 





THE NATURE AND CAUSES OF 
THE finances of France, feem, in their prefent 
flate > to admit of three very obvious reforma r 
tions. Firft, by abolifliing the taille and the . 
capitation, and by increafing the number of 
vingtiemes, fo as to produce an additional re- 
venue equal to the amount of thofe other taxes, 
fhe revenue of the crown might be preferved ; the 
expence of collection might be much diminifhed ; 
the vexation of the inferior ranks of people, 
which the taille and capitation occafion, might 
be entirely prevented ; and the fuperior ranks 
might not be more burdened than the greater part 
of them are at prefent. The vingtieme, I have 
already obferyed, is* a tax very nearly of the fame 
kind with what is called the land-tax of Eng- 
land. The burden of the taille, it is acknow r 
ledged, falls finally upon the proprietors of land j 
and as the greater part of the capitation is aiTefTed 
upon thofe who are fubjel to the taille at fo 
much a pound of that other tax, the final pay- 
ment of the greater part of it mud likewife fall 
upon tlje fame order of people. Though the 
number of the vingtiemes, therefore, was increafed 
ib as to produce an additional re.venue equal to 
the amount of both thofe taxes, the fuperior 
ranks of people might not be more burdened 
than they are at prefent. Many individuals no 
doubt would, on account of the great inequali- 
ties with which the taille is commonly afTefled 
upon the eflates and tenants of different indi- 
viduals. The interefl and oppofition of fuch 
favoured fubjeds are the obflacles moft likely 
to prevent this or any other reformation of thp 

fame 



THE WEALTH OF NATIONS. 39$ 

fame kind. Secondly, by rendering the gabelle, CHAP. 
the aides, the traites, the taxes upon tobacco, 
all the different cuftoms and excifes, uniform in 
all the different parts of the kingdom, thofe 
taxes might be levied at much lefs expence, 
and the interior commerce of *the kingdom might 
be rendered as free as that of England. Thirdly, 
and laflly, by f abject ing all thofe taxes to an ad- 
miniftration under the immediate infpe&ion and 
direction of government, the exorbitant profits of 
the farmers general might be added to the revenue 
of the flate. The oppofition arifmg from the pri- 
vate intereft of individuals, is likely to be as ef- 
fectual for preventing the two laft as the firit men- 
tioned fcheme of reformation, 

THE French fyftem of taxation feems, in every 
refpecl, inferior tp thje Britifh. In Great Britain 
ten millions flerling are annually Jevied upon 
lefs than eight millions of people, without its 
being poflible to fay that any particular order is 
opprefled. From the collections of the Abbe 
Expilly, and the obfervations of the author of 
the Effay upon the legiflation and commerce of 
corn, it appears probable that France, including 
the provinces of Lorraine and Bar, contains 
about twenty-three or twenty-four millions of 
people ; three times the number perhaps . con- 
tained in Great- Britain. The foil and climate of 
France are better than thofe of Great-Britain. 
The country has been much longer in a ftate of 
improvement and cultivation, and is, upon tha 
account, better flocked with all thofe things 
which it requires a long time to raife up and ac- 
c c 4 cumulate, 




392 THE NATURE AND CAUSES OF 

cumulate, fuch as great towns, and convenient 
and well built houfes, both in town and country. 
With thefe advantages, it might be expected that 
in France a revenue of thirty millions might be 
levied for the fupport of the (late, with as little 
inconveniency as a revenue of ten millions is in 
Great Britain. In 1765 and 1766, the whole re- 
venue paid into the treafury of France, accord- 
ing to the bed, though, I acknowledge, very im- 
perfect, accounts which I could get of it, ufually 
run between 308 and 325 millions of livres ; 
that is, it did not amount to fifteen millions 
fterling ; not the half of what nvght have been 
expe&ed, had the people contributed in the fame 
proportion to their numbers as the people of Great 
Britain. The people of France, however, it is 
generally acknowledged, are much more op- 
preileci by taxes than the people of Great Britain. 
France, however, is certainly the great empire 
in Europe which, after that of Great Britain, 
enjpys the mildeft and mod indulgent govern- 
ment. 

IN Holland the heavy taxes upon the necef- 
faries of life have ruined, it is faid, their 
principal manufactures, and are likely to dif- 
courage gradually even their 'fisheries and their 
trade in (hip-building. The taxes upon the ne* 
ceffaries of life are inconfiderable in Great 
Britain, and no manufacture has hitherto been 
ruined by them. The Britifh taxes which bear 
hardeil on manufactures are fome duties upon 
the importation of raw materials, particularly 
upon that of raw filk. The revenue of the flates 

general 



THE WEALTH OF NATIONS. 

general and of the different cities, however, is C H'A p. 
faid to amount to more than five millions two 
hundred and fifty thoufand pounds fterling ; and 
as the inhabitants of the United Provinces cannot 
well be fuppoied to amount to more than a third 
part of thofe of Great Britain, they muft, in pro- 
portion to their number, be much more heavily 
taxed. 

AFTER all the proper fubjects of taxation have 
been exhaufted, if the exigencies of the ftate flili 
continue to require new taxes, they mud be im- 
pofed upon improper ones. The taxes upon the 
neceflaries of life, therefore, may be no im- 
peachment of the wifdom of trTat republic, 
which, in order to acquire and to maintain its 
independency, has, in fpite of its great frugality, 
been involved in fuch expenfive wars as have 
obliged it to contract great debts. The fmgular 
countries of Holland and Zealand, befides, re- 
quire a confiderablc expence even to preferve 
their exiflence, or to "prevent their being fwal- 
lowed up by the fea, which muft have contributed 
to increafe confiderably the load of taxes in 
thofe two provinces. The republican form of 
government feems to be the principal fupport of 
the prefent grandeur of Holland. The owners 
of great capitals, the great mercantile families, 
have generally either fome -direct fhare, or fome 
indirect influence, in the adminiftration of that 
government. For the fake of the refpecl and 
authority which they derive from this fituation, 
they are willing to live in a country where their 
capital, if they employ it thcmfelves, will bring 

them 





394 THE NATURE AND CAUSES OF 

them lefs profit, and if they lend it to another, 
lefs interefl; and where the very moderate re- 
venue which they can draw from it will purchafe 
lefs of the neceffaries and conveniencies of life 
than in any other part of Europe. The refidence 
of fuch wealthy people necefTarily keeps alive, 
in fpite of all difadvantages, a certain degree of 
induflry in the country. Any public calamity 
which mould deflroy the republican form of go- 
vernment, which mould throw the whole admi- 
niflration into the hands of nobles and of foldiers, 
which (hould annihilate altogether the import- 
ance of thofe wealthy merchants, would foon 
render it difagreeable to them to live in a coun- 
try where they were ho longer likely to be much 
refpeded. They would remove both their refi- 
dence and their capital to fome other country, 
and the induflry and commerce of Holland 
would foon follow the capitals which fupporte4 
them. 



CHAP. III. 

Of Public Debts. 

TN that rude (late of fociety which precedes the 
extenfion of commerce and the improvement of 
manufactures, when thofe expenfive luxuries which 
commerce and manufactures can alone introduce 
are altogether unknown, the perfon who pofieffes 
a large revenue, I have endeavoured to mow in 

the 



THE WEALTH OF NATIONS. 395 

the third book of this Inquiry, can fpend or en- C H A p. 
joy that revenue in no other way than by main- 
taining nearly as many people as it can main- 
tain. A large revenue may at all times ]be faid 
to confift in the command of a large quantity of 
the neceflaries of life. In that rude ftate of 
things it is commonly paid in a large quantity of 
hofe neceflaries, in the materials of plain food 
and coarfe clothing, in corn and cattle, in wool 
and raw hides. When neither commerce nor 
manufactures furnifh any thing for which the 
owner can exchange the greater part of thofe ma- 
terials which are over and above his own con- 
fumption, he can do nothing with the furplus 
but feed and clothe nearly as many people as it 
will feed and clothe. A hofpitality in which 
there is no luxury, and a liberality in which tnere is 
no oftentation, occafion, in this fituation of things, 
the principal expences of the rich and the great. 
But thefe, I have likewife endeavoured to (how in 
the fame book, are expcnces by which people are 
not very apt to ruin themfelves. There is not 
perhaps, any felfifh pleafure fo frivolous, of which 
the purfuit has not fometimes ruined even fen- 
fible men. A paffion for cock-fighting has ruined 
many. But the inflances, I believe, are not 
very numerous of people who have been ruined 
by a hofpitality or liberality of this kind ; though 
the hofpitality of luxury and the liberality of 
cllentation have ruined many. Among our feu- 
dal anceftors, the long time during which eftates 
ufed to continue in the fame family, fufficiently 
demonftrates the general difpofition of people 

to 




THE NATURE AND CAUSES OF 

to live within their income. Though the ruftie 
hofpitality, conftantly exercifed by the great 
landholders, may not, to us in the prefent times, 
feem confident with that order, which we are 
apt to confider as infeparably connected with 
good ceconomy, yet we muft certainly allow 
them to have been at lead fo far frugal as not 
commonly to have fpent their whole income. A 
part of their wool and raw hides they had gene- 
rally an opportunity of felling for money. 
Some part of this money, perhaps, they fpent in 
purchafing the few objects of vanity aiid luxury, 
with which the circumftances of the times could 
furnifh them ; but fome part of it they feem 
commonly to have hoarded. They could not 
well indeed do any thing elfe but hoard whatever 
money they faved. To trade was difgraceful to a 
gentleman, and to lend money at interefl, which 
at that time was confidered as ufury, and prohi- 
bited by law, would have been ftill more fo. In 
thofc times of violence and diforder, befides, it 
was convenient to have a hoard of money at hand, 
that in cafe they mould be driven from their own 
home, they might have fomething of known 
value to carry with them to fome place of fafety. 
The fame violence which made it convenient 
to hoard, made it equally convenient to conceal 
the hoard. The frequency of treafure-trove, or 
of treafure found of which no owner was knqwn, 
fufficiently demonftrates the frequency in thofe 
times bah of hoarding and of concealing the 
hoard. Treafure-trove was then confidered as 
an important branch of the revenue of the fo- 

vereign. 



THE WEALTH OF NATIONS. 397 

vereign. All the treafure- trove of the kingdom c H n ^ p - 
would fcarce perhaps in the prefent times make 
an important branch of the revenue of a private 
gentleman of a good eftate. 

THE fame difpofition to fave ar;d to hoard pre- 
vailed in the fovereign, as well as in the fubje&s. 
Among nations to whom commerce and manu- 
factures are little known, the fovereign, ic has 
already been obferved in the fourth book, is in a 
fituation which naturally difpofes him to the par- 
fimony requifite for accumulation. In that fitua- 
tion the expence ever/ of a fovereign cannot 5e 
directed by that vanity which delights in the 
gaudy finery f a court. The ignorance of the 
times affords but few of the trinkets in which 
that finery confifts. Standing armies are not then 
necefiary, fo that the expence even of a fo- 
vereign, like that of any other great lord, can 
be employed in fcarce any thing but bounty to 
his tenants, and hofpitality to his retainers. But 
bounty and hofpitality very feldom lead to ex- 
travagance ; though vanity almofl always does. 
All the ancient fovereigns of Europe accordingly, 
it has already been obferved, had treafures. 
Every Tartar chief in the prefent times is faid to 
have one. 

IN a commercial country abounding with every 
fort of expenfive luxury, the fovereign, in the 
fame manner as almofl all the great proprietors 
in his dominions, naturally fpends a great part 
of his revenue in purchafing thofe luxuries. His 
own and the neighbouring countries fupply him 
abundantly with all the coftly trinkets which 

compofe 




8 THE NATURE AND CAUSES OF 

BOOK compofe the fplendid, but infigiiificant pageantr^ 
of a court. For the fake of an inferior pageantry 
of the fame kind, his nobles difmifs their re- 
tainers, make their tenants independent, and 
become gradually themfelves as infignificant as 
the greater part of the wealthy burghers in his 
dominions. The fame frivolous paflions, which 
influence their conduct, influence his. How cart 
it be fuppofed that he mould be the only rich 
man in his dominions who is infenfible to plea- 
fures of this kind ? If he does not, what he is very 
likely to do, fpend upon thofe pleafures fo great 
a part of his revenue as to debilitate very much 
the defenfive power of the ftate, it cannot well be 
expected that he mould not fpend upon them all 
that part of it which is over and above what is 
neceffary for fupporting that defenfive power. 
His ordinary expence becomes equal to his or- 
dinary revenue, and it is well if it does not fre- 
quently exceed it. The amailing of treafure can 
no longer be expected, and when extraordinary- 
exigencies require extraordinary expences, he 
muft necefiarily call upon his fubje&s for an 
extraordinary aid. The prefent and the late 
king of Pruffia are the only great princes of Eu- 
rope, who, fmce the death of Henry IV. of 
France in 1610, are fuppofed to have amafled any 
confiderable treafure. The parfimony which leads 
to accumulation has become almofl as rare in re- 
publican as in monarchical governments. The 
Italian republics, the United Provinces of the 
Netherlands, are all in debt. The canton of 
Berne is the fmgle republic in Europe which 

baa 



THE WEALTH OF NATIONS. 399 

has amafled any confiderable treafure. The other c H A F 

Swifs republics have not. The tafte for fome 

fort of pageantry, for fplendid buildings, at lead, 

and other public ornaments, frequently prevails 

as much in the apparently fober fenate-houfe of 

a little republic, as in the diflipated court of the 

greateft king. 

THE want of parfimony in time of peace, iin- 
pofes the necefiity of contracting debt in time of 
war. When war comes, there is no money in 
the treafury but what is neceflary for carrying on 
the ordinary expence of the peace eftablifhment. 
In war an eftablifhment of three or four times 
that expence becomes neceffary for the defence of 
the ftate, and confequemly a revenue three or 
four times greater than the peace revenue. Sup- 
pofmg that the fovereign mould have, what he 
fcarce ever has, the immediate means of aug- 
menting his revenue in proportion to the aug- 
mentation of his expence, yet fliil the produce 
of the taxes, from which this increafe of revenue 
muft be drawn, will. not begin to come into the 
treafury till perhaps ten or twelve months after 
they are impofed. But the moment in which 
war begins, or rather the moment in which it ap- 
pears likely to begin, the army mud be augment- 
ed, the fleet mult be fitted out, the garriibned 
towns muft be put into a poflure of defence; that 
army, that fleet, thofe garrifoned towns muft be 
furnifhed with, arms, ammunition, and provi- 
fions. An immediate and grea f expence muft be 
incurred in that moment of immediate danger, 
which will not wait for the gradual and flow re- 
turns 



400 THE NATURE AND CAUSES OF 

BOOK turns of the new taxes. In this exigency govern- 
ment can have no other refource but in borrowing. 

THE fame commercial ftate of fociety which, 
by the operation of moral caufes, brings govern- 
ment in this manner into the neceflity of borrow- 
ing, produces in the fubjects both an ability and 
an inclination to lend. If it commonly brings 
along with it the neceflity of borrowing, it likewife 
brings with it the facility of doing fo. 

A COUNTRY abounding with merchants and 
manufacturers, neceflarily abounds with a fet of 
people through whofe hands not only their own 
capitals, but the capitals of all thofe who either 
lend them money, or trufi them with goods,, pafs 
as frequently, or more frequently, than the re- 
venue of a private man,, who, without trade or 
bufmefs, lives upon his income, pafTes through 
his hands. The revenue of fuch a man can regu* 
larly pafs through his hands only once in a year. 
But the whole amount of the capital and credit 
of a merchant, who deals in a trade of which the 
returns are very quick, may fometimes pafs 
through his hands two, three, or four times in a 
year. A country abounding with merchants and 
manufacturers, therefore, neceflarily abounds 
with a fet of people who have it at all times in 
their power to advance, if they chufe to do fo, a 
very large fum of money to government. Hence 
the ability in the fubjeds of a commercial (late to 
lend. 

COMMERCE and manufactures can feldom flou- 
rifh long in any ftate which does not enjoy a 
regular adminiftration of juftice, in which the 
8 people 



THE WEALTH OF NATIONS. 401' 

eole do not feel themfelves fecure in the pof- CHAP, 
feflion of their property, in which the faith of 
contra&s is not fupported by law, and in which 
the authority of the ftate is not fuppofed to be 
regularly employed in enforcing the payment of 
debts from all thofe who are able to pay. Com- 
merce and manufactures, in fhort, can feldorn 
flourifh in any (late in which there is not a cer- 
tain degree of confidence in the jufHce of go* 
vernment. The fame confidence which difpofes 
great merchants and manufacturers, upon ordi- 
nary occufions, to truft their property to the pro- 
tection of a particular government, difpofes 
them, upon extraordinary occafions, to truft that 
government with the ufe of their property. By 
lending money to government, they do not everi 
for a moment diminifh their ability to carry on 
their trade and manufactures. On the contrary 
they commonly augment it* The necefiities of 
the ftate render government upon moft occafions 
willing to borrow upon terms extremely advan- 
tageous to the lender. The fecurity which it 
grants to the original creditor, is made tranf- 
ferable to any other creditor, and, from the uni* 
verfal confidence in the juftice of the ftate, gene- 
rally fells in the market for more than was ori- 
ginally paid for it. The merchant or monied 
man makes money by lending money to govern- 
ment, and, inftead of diminifhing, increafes his 
trading capital. He generally confiders it as 
a favour, therefore, when the adminiftration. 
admits him to a fhare in the firft fubfcription 
YOL. ui D D for 



4 o2 THE NATURE AND CAUSES OF 

BOOK for a new loan. Hence the inclination or will- 



ingnefs in the fubjecls of a commercial flate to 
lend. 

THE government of fuch a flate is very apt to 
repofe itfelf upon this ability and willingnefs of 
its fubjeds to lend it their money on extraordi- 
nary occafions. It forefees the facility of bor- 
rowing, and therefore difpenfes itfelf from the 
duty of faving. 

IN a rude flate of fociety there are no great 
mercantile or manufacturing capitals. The in. 
dividuals, who hoard whatever money they can 
fave, and who conceal their hoard, do fo from a 
diftruft of the juilice of government, from a fear 
that if it was known that they had a hoard, and 
where that hoard was to be found, they would 
quickly be plundered. In fuch a flate of things 
few people would be able, and nobody would be 
willing, to lend their money to government on 
extraordinary exigencies. The fovereign feels that 
he mufl provide for fuch exigencies by faving, 
becaufe he forefees the abfolute impoffibility oi" 
borrowing. This forefight increafes ftill further 
his natural difpofition to fave. 

THE progrefs of the enormous debts which at 
prefent opprefs, and will in the long-run pro- 
bably ruin, all the great nations of Europe, has 
been pretty uniform. Nations, like private 
men, have generally begun to borrow upon what 
may be called perfonal credit, without afligning 
or mortgaging any particular fund for the pay- 
ment of the debt j and when this refource has 

failed 



THE WEALTH OF NATIONS. 405 

failed them, they have gone on to borrow upon CHAP* 
aflignments or mortgages of particular funds. 

WHAT is called the unfunded debt of Great 
Britain, is contracted in the former of thofe ,two 
ways. It confifts partly in a debt which bears, 
or is fuppofed to bear, no intereft, and which 
refembles the debts that a private man contracts 
upon account ; and partly in a debt which bears 
intereft, and which refembles what a private man 
contracts upon his bill or prcmiflbry note. ^ The 
debts which are due either for extraordinary fer- 
vices, or for fervices either not provided for, or 
not paid at the time when they are performed ; 
part of the extraordinaries of the army, navy, and 
ordnance, the arrears of fubfidies to foreign, 
princes, thofe of feamen's v/ages, &c. ufually 
conftitute a debt of the firft kind. Navy and 
Exchequer bills, which are -idiied fometimes in 
paynent of a part of fuch debts and fometimes 
for other purpofes, conftitute a debt of the 
fecond kind ; Exchequer bills bearing intereft 
from the day on which they are ifTued, and navy 
bills fix months after they are iffued. The bank 
of England, either by voluntarily difcounting 
thofe bills at their current value, or by agreeing 
with government for certain confederations to 
circulate Exchequer bills, that is, to receive 
them at par, paying the intereft which happens 
to be due upon them, keeps up their value and 
facilitates their circulation, and thereby fre- 
quently enables government to contract a very 
Iirge d *bt of this kind. In France, where. there 
is no bank, the ftate bills (billets d'etat *) have 

* S ;: Jixamen ties Reflexions politiques fur ks Finances. 

D D 2 fometimes 




THE NATURE AND CAUSES OF 

fometimes fold at fixty and feventy per cent, 
difcount. During the great re-coinage in king 
William's time, when the bank of England 
thought proper to put a flop to its ufual tranf* 
actions, Exchequer bills and tallies are faid to 
have fold from twenty-five to fixty per cent* 
difcount ; owing partly, no doubt, to the fuppofed 
inilability of the new government eftablifhed by 
the Revolution, but partly too to the want of the 
fupport of the bank of England. 

WHEN this refource is exhaufled, and it be- 
comes neceflary, in order to raife money, to af- 
fign or mortgage fome particular branch of the 
public revenue for the payment of the debt, go- 
vernment has up cm different occafions done this 
in two different ways. Sometimes it has made 
this alignment or mortgage for a fhort period of 
time only, a year or u few years, for example - f 
and fometinies for perpetuity. In the one cafe, 
the fund was fuppofed jfufficient to pay, within- 
the limited time, both principal and intereft of 
the money borrowed. In the other, it was fup- 
pofed fufficient to pay the intereft only, or a 
perpetual annuity equivalent to the intereft, go- 
vernment being at liberty to redeem at any time 
this annuity, upon paying- back tke principal furn 
borrowed. When money was raife d in the one 
way, it was faid to be raifed by anticipation $ when 
in the other, by perpetual funding, or, more 
ihortly, by funding. 

IN Great Britain the annual land ami nialt 
taxes are regularly anticipitated every y.eiir, by 
virtue of a borrowing claufe conftantly iaferted 

into 



THE WEALTH OF NATIONS. 405 

into the acts which impofe them. The bank of C H A p. 
England generally advances at an intereft, which 
fince the Revolution has varied from eight to 
three per cent, the fums for which thofe taxes are 
granted, and receives payment as their produce 
gradually comes in. If there is a deficiency, 
which there always is, it is provided for in the 
fupplies of the enfuing year. The only con- 
fiderable branch of the public revenue which 
yet remains unmortgaged is .thus regularly fpent 
before it comes in. Like an improvident fpend- 
thrift, whofe prefling occafions will not allow, 
him to wait for the regular payment of his reve- 
nue, the ftate is in the conftant practice of bor* 
rowing of its own factors and agents, and. of pay- 
ing intereft for the ufe of its own money. 

IN the reign of king William, and during a 
great part of that of queen Anne, before we had 
become fo familiar as we are now with the .prac- 
tice of perpetual funding, the greater part of the 
new taxes were impofed but for a (hort period of 
time (for four, five, fix, or feven years only), 
and a great part of the grants of every year con* 
fitted in loans upon anticipations of the produce 
of thofe taxes. The produce being frequently 
infufficient for paying within the limited term the 
principal and intereft of the money borrowed, de- 
ficiencies arofe, to make good which it became, 
necefiary to prolong the term. 

IN 1697, by the 8th of William III. c. 20. the 

deficiencies 6f feveral taxes were charged upon 

what was then called the firft general mortgage 

pr fund coftfifting of a prolongation to the fir ft 

003 of 



4o6 THE NATURE AND CAtJSES OF 

BOOK of Auguft, 1706, of feveral different taxes, 
v - ^ which would have expired wit. in a fhorter 
term, and of which the produce was accumu- 
lated into one general fund. The deficiencies 
charged upon this prolonged term amounted to 
5,160,459 /. 14 s. g^d. 

IN 1701, thofe duties, with fome others, 
were ftill further prolonged for the like pur- 
pofes till the nrft of Auguil, 1710, and were 
called the fecond general mortgage or fund. 
The deficiencies charged upon it amounted to 

^^55^999^ 7 s - ^\ d - 

IN 1707, thofe duties were ftill further pro- 
longed, as a fund for new loans, to the firft of 
Auguft, 1712, and were called the third general 
mortgage or fund. The fum borrowed upon it 
was 983,254;?. ii s. q~d. 

IN 1708, thofe duties were all (except the old 
fubfidy of tonnage and poundage, of which one 
moiety only was made a part of this fund, and a 
duty upon the importation of Scotch linen, which 
had been takefi off by the articles of union) ftill 
further continued, as a fund for new loans, to the 
firft of Augufl, 1714, and were called the fourth 
general mortgage or. fund. The fum borrowed 
upon it was 925,1767. 9 s. id> 

IN 1709, thofe duties were all (except the old 
fubfidy of tonnage and poundage, which was now 
left out of this fund altogether) (till further con- 
tinued for the fame purpofe to the firft of 
Auguft, 1716, and were called the fifth general 
mortgage or fund. The fum borrowed upon it 
was 922,0297. 6 s. o4f 

IN 



THE WEALTH OF NATIONS. 407 

IK 1710, thofe duties were again prolonged to CHAP. 
the firft of Auguft, 1720, and were called thefixth 
general mortgage or fund. The fum borrowed 
upon it was 1,296,5527. gs. \i\d. 

IN 1711, the fame duties (which at this time 
were thus fubjecl: to four different anticipations), 
together with feveral others, were continued for 
ever, and made a fund for paying the intereft of 
the capital of the South Sea Company, which had 
that year advanced to government, for paying 
debts and making good deficiencies, the fum of 
9,177,9677. i$s. 4d. the greateft loan which at 
that time had ever been made. 

BEFORE this period, the principal, fo far as I 
have been able to obferve, the only taxes which 
in order to pay the interefl of a debt had been 
impofed for perpetuity, were thofe for paying 
the intereft of the money which had been ad- 
vanced to government by the Bank and Eaft India 
Company, and of what it was expe&ed would be 
advanced, but which was never advanced, by a 
projected land bank. The bank fund at this time 
amounted to 3,375,0277 ijs. iv\d. forwhichwas 
paid an annuity or intereft of 206,501 /. 131. 5 d. 
The Eaft India fund amounted to 3,200,000 /. 
for~which was paid an annuity or intereft of 
1 60,000 /. ; the bank fund being at fix percent. ; 
the Eaft India fund at five per cent, intereft. 

IN 1715, by the firft of George I. c, 12. the 
different taxes which had been mortgaged for 
paying the bank annuity, together with feveral 
others which by this ad were likewife rendered 
perpetual, were accumulated into one common 
D D 4 fund 



4 o$ THE NATURE AND CAUSES OF 

BOOK fund called The Aggregate Fund, which was 
charged not only with the payments of the bank 
annuity, but with feyeral other annuities an4 
burdens of different kinds. This fund was after < 
wards augmented by the third of George I. c. 8. 
and by the fifth of George I. c. 3. and the different 
duties which were then added to it were likewife 
rendered perpetual. 

IN ..1717, by the third of George I. c. 7. 
feveral other taxes were rendered perpetual, 
and accumulated into another common . fund, 
called The General Fund, for the payment of 
certain annuities, amounting in the whole to 
72458497. 6 s, icf d. 

IN confequence of thofe different a&s, the 
greater part of the taxes which before had been 
anticipated only for a ihort term of years, were 
rendered perpetual as a fund for paying, not the 
capital, but the interefl only, of the money which 
had been borrowed upon them by different fuc- 
ceflive anticipations. 

HAD money never been raifed but by antici- 
pation, the courfe of a few years would have 
liberated the public revenue, without any other 
attention of government beiides that of not 
overloading the fund by charging it with more 
debt than it could pay within the limited term, 
and of not anticipating a fecond time before the 
expiration of the firft anticipation. But the 
greater part of European governments have been 
incapable of thofe attentions. - They . have fre- 
quently overloaded the fund even upon the firft 
anticipation ; and when this happened not to be 

the 



THE WEALTH OF NATIONS. 
the cafe, they have generally taken care to over- 
load it, by anticipating a fecond and a third 
time before the expiration of the firft anticipa- 
tion. The fund becoming in this manner alto- 
gether infufficient for paying both principal and 
intereft of the money borrowed upon it, it be- 
came neceffary to charge it with the intereft only, 
or a perpetual annuity equal to the intereft, and 
fuch improvident anticipations neceflarily gave 
birth to the more ruinous practice of perpetual 
funding. But though this practice neceflarily 
puts off the liberation of the public revenue from 
a fixed period to one fo indefinite that it is not 
very likely ever to arrive ; yet as a greater fum 
can in all cafes be raifed by this new practice 
than by the old one of anticipations, the former, 
when men have once become familiar with it, has 
in the great exigencies of the ftate been univerfaliy 
preferred to the latter. To relieve the prefent 
exigency is always the object which principally 
interefts thofe immediately concerned in the ad- 
miniftration of public affairs. The future liberation 
of the public revenue, they leave to the care of 
pofterity. 

DURINQ the reign of queen Anne, the market 
rate of intereft had fallen from fix to five per 
cent., and in the twelfth year of her reign five 
per cent, was declared to be the higheft rate 
which could lawfully be taken for money bor- 
rowed upon private fecurity. Soon after the 
greater part of the temporary taxes of Great 
Britain had been rendered perpetual, and diftri- 
buted into the Aggregate, South Sea, and 

CeneraJ 




4 io THE NATURE AND CAUSES OF 

BOOK General funds, the creditors of the public, like 
thoie of private perfons, were induced to accept 
of five per cent, for the interefl of their money, 
which occafioned a faving of one per cent, upon 
the capital of the greater part of the debts 
which had been thus funded for perpetuity, or 
of one fix tli of the greater part of the annuities 
which were paid out of the three great funds 
above mentioned. This faving left a confider- 
able furplus in the produce, of the different taxes 
which had been accumulated into thofe funds, 
over and above what was neceflary for paying 
the annuities which were now charged upon 
thefn, and laid the foundation of what has fince 
been called the Sinking Fund. In 1717, it 
amounted 10323,4347. j$. i\ d. In 1727, the 
intereft of the greater part of the public debts was 
flill further reduced to four per cent. ; and in 1753 
and 1757, to three and a half and three per cent. ; 
which reductions flill further augmented the fink- 
ing fund. 

A SINKING fund, though inftituted for the 
payment of old, facilitates very much the con- 
trading of new debts. It is a fubfidiary fund 
always at hand to be mortgaged in aid of any 
other doubtful fund, upon which money is pro- 
pofed to be raifed in any exigency of the ftate. 
Whether the finking fund of Great Britain has 
been more frequently applied to the one or to the 
other of thofe two purpofes, will fufficiently appear 
by and by. 

BESIDES thofe two methods of borrowing, by 
anticipations and by perpetual funding, there 

are 



THE WEALTH OF NATIONS. 

fcre two other methods, which hold a fort of middle 
place between them. Thefe are, that of borrow- 
ing upon annuities for terms of years, and that of 
borrowing upon annuities for lives. 

DURING the reigns of king William and 
queen Anne, large iums were frequently bor- 
rowed upon annuities for terms of years, which 
were fometimes longer and fometimes fhorter. 
In 1693, an aft was palled for borrowing one 
million upon an annuity of fourteen per cent., or 
of 140,0007. a year for fixteen years. In 1691, 
an act was paffed for borrowing a million upon 
annuities for lives, upon terms which in the 
prefent times would appear very advantageous. 
But che fubfcription was not filled^up. In the 
following year the deficiency was made good by 
borrowing upon annuities for lives at fourteen 
per cent., or at little more than feven years pur* 
chafe. In 1695, the perfons who had purchafed 
thofe annuities were allowed to exchange them 
for others of ninety-fix years, upon paying into 
the Exchequer fixty-three pounds in the hun- 
dred ; that is, the difference between fourteen 
per cent, for life, and fourteen per cent, for 
ninety-fix years, was fold for fixty-three pounds, 
. or for four and a half years purchafe. Such was 
the fuppofed inflability of government, that 
even thefe terms procured few purchafers. In 
the reign of queen Anne, money was upon dif- 
ferent occafions borrowed both upon annuities 
for lives, and upon annuities for terms of thirty- 
two, of eighty-nine, of ninety-eight, and of 
ninety-nine years. In 1719, the proprietors of 

the 







4 i2 THE NATURE AND CAUSES OF 

BOOK the annuities for thirty-two years were induced 
^_ - y .. to accept in lieu of them South Sea flock to the 
amount of eleven and a half years purchafe of 
the annuities, together with an additional quan* 
tity of flock equal to the arrears which happened 
then to be due upon them. In 172-0, the greater 
part of the other annuities for terms of years both 
long and fhort were fubfcribed into the fame 
' fund. The long- annuities at that time amounted 
to 666,821 /. Ss. $\d. a year. On the 5th of 
January 1775, the remainder of them, or what 
was not fubfcribed at that time, amounted only 
to 136,453 /, 12 s. 8 d. 

DURING the two wars which begun in 1739 
<md in 1755, little money was borrowed either 
upon annuities for terms of years, or upon thof 
for lives. An annuity for ninety-eight or 
ninety-nine years, however, is worth nearly as 
much money as a perpetuity, and fliould, there- 
fore, one might think, be a fund for borrowing 
nearly as much. But thofe who, in order to 
make family fettlements, and to provide for re* 
mote futurity, buy into the public flocks, 
would not care to purchafe into one of which 
the value was continually diminifhing ; and fuch 
people make a very confiderable proportion 
both of the proprietors and purchafers of flock, 
An annuity for a long term of years, therefore* 
though its intrinfic value may be very nearly 
the fame with that of a perpetual annuity, will 
not find nearly the fame number of purchafers. 
The fubfcribers to a new loan, who mean gene- 
rally to fell their fubfcription as foon as poflible, 

prefey 



THE WEALTH OF NATIONS. 41$ 

prefer greatly a perpetual annuity redeemable by C H A P. 
parliament to an irredeemable annuity for a long v^r-y^^ 
term of years of only equal amount. The value 
of the former may be fuppofcd always the fame, 
or very nearly the fame ; and it makes, there- 
fore, a more convenient transferable flock than 
the latter. 

DURING the two lad mentioned wars, annui- 
ties, either for terms of years or for lives, were 
feldom granted but as premiums to the fub- 
fcribers to a new loan, over and above the re- 
deemable annuity or intereft upon the credit of 
which the loan was fuppofed to be made. They 
were granted not as the proper fund upon which 
the money was borrowed ; but as an additional 
encouragement to the lender. 

ANNUITIES for lives have occafionally been 
granted in two different ways ; either upon fe- 
parate lives, or upon lots of lives, which in 
French are called Tontines, from the name of 
their inventor. When annuities are granted 
upon feparate lives, the death of every indi- 
vidual annuitant difburdens the public revenue 
fo far as it was affected by his annuity. When 
annuities are granted upon tontines, the libe- 
ration of the public revenue does not commence 
till the death of all the annuitants comprehended 
in one lot, which may fometimes confift of 
twenty or thirty perfons, of whom the furvivors 
fucceed to the annuities of all thofe who die be-, 
fore them ; the laft furvivor fucceeding to the 
annuities of the whole lot. Upon the fame re- 
venue more money can always be raifed by ton- 
tines 



4H THE NATURE AND CAUSES OF 

BOOK tines than by annuities for feparate lives. An 
annuity, with a right of furvivorfhip, is really 
worth more than an equal annuity for a feparate 
life, and from the confidence which every man 
naturally has in his own good fortune, the prin- 
ciple upon which is founded the fuccefs of all 
lotteries, fuch an annuity generally fells for fome- 
thing more than it is worth. In countries where 
it is ufual for government to raife money by 
granting annuities, tontines are upon this 'account 
generally preferred to annuities for feparate lives. 
The expedient which will raife moft money, is 
almoft always preferred to that which is likely to 
bring about in the fpeedielt manner the liberation 
of the public revenue. 

IN France a much greater proportion of the 
public debts confifts in annuities for lives than 
in England. According to a memoir prefented 
by the parliament of Bourdeaux to the king in 
1764, the whole public debt of France is efti- 
mated at twenty-four hundred millions of livres ; 
of which the capital for which annuities for lives 
had been granted, is fuppofed to amount to three 
hundred millions, the eighth part of the whole 
public debt. The annuities themfelves are 
computed to amount to thirty millions a year, 
the fourth part of one hundred and twenty mil- 
lions, the fuppofed interefl of that whole debt. 
Thefe eftimations, I know very well, are no? 
exad, but having been prefented by fo very 
refpeclable a body as approximations to the 
truth, they may, I apprehend, be confidered as. 
fuch, It is not the different degrees of anxiety 



THE WEALTH OF NATIONS. 4*5 

in the two governments of France and England CJIAP. 
for the liberation of the public revenue, which oc- 
cafions this difference in their refpe&ive modes 
of borrowing : it arifes altogether from the dif- 
ferent views and interefts of the lenders. 

IN England, the feat of government being in 
the greateft mercantile city in the world, the 
merchants are generally the people who advance 
money to government. By advancing it they 
do not mean to diminifh, but, on the contrary, 
to increafe their mercantile capitals ; and unlefs 
they expected to fell with fome profit their mare 
in the fubfcription for a new loan, they never 
would fubfcribe. But if by advancing their 
money they were to purchafe, inftead of per- 
petual annuities, annuities for lives only, whether 
their own or thofe of other people, they would 
not always be fo likely to fell them with a profit. 
Annuities upon their own lives they would 
^always fell with lofs ; becaufe no man will give 
for an annuity upon the life of another, whofe 
age and flate of health are nearly the fame with 
his own, the fame price which he would give for 
one upon his own. An annuity upon the life of 
a third perfon, indeed, is, no doubt, of equal 
value to the buyer and the feller ; but its real 
value begins to diminifh from the moment it is 
granted, and continues to do fo more and more 
as long as it fubfifts* It can never, therefore, 
make fo convenient a transferable flock as a 
perpetual annuity, of which the real value may 
be fuppofed always the fame, or very nearly the 

IN 




THE NATURE AND CAUSES OF 

^ N France, tne ^ eat f government not being 
in a great mercantile city, merchants do not 
make fo great a proportion of the people who 
advance money to government. The people 
concerned in the finances, the farmers general* 
the receivers of the taxes which are not in farm, 
the court bankers, &c. make the greater part 
of thofe who advance their money in all public 
exigencies. Such people are commonly men of 
mean birth, but of great wealth, and frequently 
of great pride. They are too proud to marry 
their equals, and women of quality difdain to 
marry them. They frequently refolve, therefore, 
to live bachelors, and having neither any families 
of their own, nor much regard for thofe of their 
relations, whom they are not always very fontf 
of acknowledging, they defire only to live in 
fplendour during their own time, and are not un- 
willing that their fortune mould end .with them* 
felves. The number of rich people, befides, 
who are either averfe to marry, or whofe condi- 
tion of life renders it either improper or incon- 
venient for them to do fo, is much greater in 
France than in England. To fuch people, who 
have little or no care for pofterity, nothing can 
be more convenient than to exchange their capital 
for a revenue, which is to lad jud as long, and 
no longer than they wifh it to do. 

THE ordinary expence of the greater part of 
modern governments in time of peace being 
equal or nearly equal to their ordinary revenue, 
when war comes, they are both unwilling and 
unable to iuoreafe their revenue in proportion 
3 to 



THE WEALTH OF NATIONS. 417 

to the increafe of their expence. They are un- C H A P. 
willing, for fear of offending the people, who, 
by fo great and fo fudden an increafe of taxes, 
would foon be difgufted with the war ; and they 
are unable, from not well knowing what taxes 
would be fufficient to produce the revenue 
wanted. The facility of borrowing delivers 
them from the embarraffment which this fear 
and inability would otherwife ' occafion. By 
means of borrowing they are enabled, with a 
very moderate increafe of taxes, to raife, from 
year to year, money fufficient for carrying on 
the war, and by the practice of perpetual 
funding they are enabled, with the fmallefr. 
poffible increafe of taxes, to raife annually the 
largeft poffible fum of money. In great empires 
the people who live in the capital, and in the 
provinces remote from the fcene of action, feel, 
many of them, fcarce any inconveniency from the 
war ; but enjoy, at their eafe, the amufement of 
reading in the newfpapers the exploits of their 
own fleets and armies. To them this amufe- 
ment compenfates the fmall difference between 
the taxes which they pay on account of the war, 
and thofe which they had been accuftomed to 
pay in time of peace. They are commonly dif- 
latisfied with the return of peace, which puts an 
end to their amufement, and te a thoufand vifionary 
hopes of conqueft and national glory, from a longer 
continuance of the war. 

THE return of peace, indeed, feldom relieves 
them from the greater part of the taxes impofed 
during the war. Thefe are mortgaged for the 

VOL. in. E E hitercfl 





THE NATURE AND CAUSES . OF 
intereft of the debt contracted in order to carry 
it on. If, over and above paying the intereft of 
this debt, and defraying the ordinary expence of 
government, the .old revenue, together with the 
new taxes, produce fome furplus revenue, it 
may perhaps be converted into a finking fund 
for paying off the debt. But, in the firft place, 
this finking fund, even fuppofing it mould be 
applied to no other purpofe, is generally alto- 
gether inadequate for paying, in the courfe of 
any period during which it can reafonably be ex- 
pected that peace mould continue, the whole debt 
contracted during the war-, and, in the fecond 
place, this fund is almoft always applied to other 
purpofes. 

THE new taxes were impofed for the fole pur- 
pofe of paying the intereft of the money borrowed 
upon them. If they produce more, it is ge- 
nerally fomething which was neither intended 
nor expected, and is therefore feldom very con- 
fiderable. Sinking funds have generally arifen> 
not fo much from any furplus of the taxes which 
was over and above what was neceifary for pay- 
ing the intereft or annuity originally charged 
upon them, as from a fubiequent reduction of 
that intereft. That of Holland in 1655, and 
that of the ecclefiaftical ftate in 1685, were both- 
formed in this manner. Hence the ufual in- 
fufficiency of fuch funds. 

DURING the moft profound peace, various 
events occur which require an extraordinary ex- 
pence, and government finds it always more con- 
venient to defray this expence by mifapplying 
9 the 



THE WEALTH OF NATIONS. 419 

the finking fund than by impofmg a new tax. CHAP. 
Every new tax is immediately felt more or lefs 
by the people. It occafions always fome mur- 
mur, and meets with fome oppoficion. The 
more taxes may have been multiplied, the higher 
they may have been raifed upon every different 
fubjecl of taxation ; the more loudly the people 
complain of every new tax, the more difficult 
it becomes too either to find out new fubjecls of 
taxation, or to raife much higher the taxes al- 
ready impofed upon the old. A momentary 
fufpenfion of the payment of debt is not imme- 
diately felt by the people, and occafions neither 
murmur nor complaint. To borrow of the fink- 
ing fund is always an obvious and eafy expe- 
dient for getting out of the prefent difficulty* 
The more the public debts may have been ac- 
cumulated, the more necelfary it ma'y have be* 
come to fludy to reduce them, the more danger- 
ous, the more ruinous it may be to mifapply any 
part of the finking fund ; the lefs likely is the 
public debt to be reduced to any confiderable 
degree, the more likely, the more certainly is 
the finking fund to be mifapplied towards de- 
fraying all the extraordinary expences which oc* 
cur in time of peace. When a nation is already 
overburdened with taxes, nothing but the necef- 
fities of a new war* nothing but either the ani* 
mofity of national vengeance, or the anxiety for/ 
national fecurity, can induce the people to fub- 
mit, with tolerable patience, to a new tax* 
Hence the ufual mifapplication of the finking 
fund. 

E i IK 




THE NATURE AND CAUSES OF 

IN Great Britain, from the time that we had 
firft recourfe to the ruinous expedient of per- 
petual funding, the reduction of the public debt 
in- time of peace has never borne any proportion 
to its accumulation in time of war. It was in 
the war which began in 1688, and was concluded 
by the treaty of Ryfwickin 1697, that the founda- 
tion of the prefent enormous debt of Great Britain 
was firft laid. 

ON the 3ift of December 1697, the public 
debts of Great Britain, funded and unfunded* 
amounted to 21,515,7427. i$s. 8^d. A great 
part of thofe debts had been contracted upon 
mort anticipations, and fome part upon annuities 
for lives; fo that before the 31 ft of December 
1701, in lefs than four years, there had partly 
been paid off, and partly reverted to the public, 
the fum of 5,121,0417. 12 s. v\d.\ a greater re- 
duction of the public debt than has ever fmce 
been brought about in fo fhort a period of time. 
The remaining debt, therefore, amounted only 
to 16,394,7017. is. j^d. 

IN the war which began in 1702, and which 
was concluded by the treaty of Utrecht, the 
public debts were {till more accumulated. On 
the 31(1 of December 1714, they amounted to 
53,681,0767. 5,;. 6~d. The fubfcription into 
the South Sea fund of the fhort and long an- 
nuities increafed the capital of the public debts, 
fo that on the 31 ft of December 1722, it 
amounted to 55,282,9787. is. &d. The re- 
duction of the debt began in 172:5, and went on 
fo ilowly that, on the 31 ft of December 1739, 

during 



THE WEALTH OF NATIONS. 42, 

during feventeen years of profound peace, the c H A p. 
whole fum paid off was no more than 8,328,3547. 



17-r. iiiW. the capital of the public debt at that 
time amounting to 46,95456237. $s. 4iW. 

THE Spanifh war, which began in 1739, and 
the French war which foon followed it, occafioned 
a further increafe of the debt, which, on the 3ifl 
of December 1748, after the war had been con- 
cluded by the treaty of Aix la Chapelle, amounted 
to 73,293,3137. is. io%d. The moft profound 
peace of feventeen years continuance had taken , 
no more than 8,328,3547. 171. nJL.< from it. 
A war of lefs than nine years continuance added . 
31,338,6897. iSs. 6 J. to it*. 

DURING the adminiflration of Mr. Pelham, 
the interefl of the public debt was reduced, or 
at lead meafures were taken for reducing it, 
from four to three per cent, j the finking fund 
was increafed, and fome part of the public debt 
was paid off. In 1755, before the breaking out 
of the late war, the funded debt of Great Britain 
amounted to 72,289,6737. On the fifth of Ja- 
nuary 1763, at the conclufion of the peace, the 
funded debt amounted to 122,603,3367. 8 s. 
z^d. The unfunded debt has been ftated at 
13,927,5897. 2j. ad. But the expence occa- 
fioned by the war did not end with the con- 
clufion of the peace; fo that though, on the 5th 
of January 1764, the funded debt was increafed 
(partly by a new loan, and partly by funding a 
part of the unfunded debt) to 129,586,7897, 

* See James Poftlethwaite's hiftory of the public revenue. 

E E 3 10X. 




4* THE NATURE AND CAUSES OF 

BOOK I ox. i^d. there (till remained (according to the 
v * very well informed author of the Confi derations 
on the trade and finances of Great Britain) an 
unfunded debt, which was brought to account in 
that and the following year, of 9,975,0177. us. 
z^d. In 1764, therefore, the public debt 
of Great Britain, funded and unfunded to- 
gether, amounted, according to this author, to 
139,516,8077. 2s. 4-d. The annuities for lives 
too, which had been granted as premiums to the 
fubfcribers to the new loans in 1757, eftimated 
at fourteen years purchafe, were valued at 
472,5007. ; and the annuities for long terms of 
years, granted as premiums likewife, in 1761 
and 1762, eftimated at 27! years purchafe, were 
valued at 6,826,8757. During a peace of about 
feven years continuance, the prudent and truly 
patriot, adminiftration of Mr. Pelham ' was not 
able to pay off an old debt of fix millions. 
During a war of nearly the fame continuance, a 
new debt of more than feventy-five millions was 
contracted. 

ON the 5th of January 1775, the funded 
debt of Great Britain amounted to 124,996,086 
is. 6~d. The unfunded, exclufive of a large 
civil Jift debt, to 4,150,2367. ^s. u^d. Both 
together, to 1295146,3227. 51. 6d, Accord- 
ing to this account the whole debt paid off 
during eleven years profound peace amounted 
only to 10,415,4747. i6s. $ 7 s d. Even this 
fmall reduction of debt, however, has not been 
all made from the favings out of the ordinary 
revenue of the ftate. Several extraneous fums, 

altogether 



THE WEALTH Of NATIONS. 42$ 

altogether independent of that ordinary revenue, CHAP. 
have contributed towards it. Amongft thefe we 
may reckon an additional fhilling in the pound 
land-tax for three years ; the two millions re- 
ceived from the Eaft India company, as indem- 
nification for their territorial acquifitions ; and 
the one hundred and ten thoufand pounds received 
from the bank for the renewal of their charter. 
To thefe mud be added feverai other fums which, 
as they arofe out of the late war, ought perhaps to 
be confidered as deductions from the expences of it. 
The principal are, 

/. i. d. 

The produce of French prizes 690,449 18 9 
Compofition for French prifoners 670,000 o o 
What has been received from 7 

the fale of the ceded ifiands J 95 ' 5 ( 



Total, i,455>949 l8 9 

If we add to this fum the balance of the earl of 
Chatham's and Mr. Calcraft's accounts, and 
other army favings of the fame kind, together 
with what has been received from the bank, the 
Eaft India company, and the additional fhilling 
in the pound land-tax ; the whole muft be a 
good deal more than five millions. The debt, 
therefore, which fince the peace has been paid 
out of the favings from the ordinary revenue 
of the (late, has not, one year with another, 
amounted to half a million a year. The finking 
fund has, no doubtj been confiderably augmented 
fince the peace, by the debt which has been paid 
E E 4 off, 



414 THE NATURE AND CAUSES OF 

BOOK off, by the. reduction of the redeemable four per 
cents, to three per cents,, and by the annuities 
for lives which have fallen in, and a if peace were 
to continue, a, million, perhaps, might now be 
annually fpared out of it towards the difcharge 
of the debt. Another million, accordingly, was 
paid in the courfe of laft year ; but, at the fame 
time, a large civil lift debt was left unpaid, and 
we are now involved in a new war which, in its 
progrefs, may prove as expenfive as any of our 
former wars *. The new debt which will pro- 
bably be contracted before the end of the next 
campaign, may perhaps be nearly equal to all the 
old debt which has been paid off from the favings 
out of the ordinary revenue of the ftate. It 
would be altogether chimerical, therefore, to 
xpet that the public debt mould ever be com- 
pletely difcharged by any favings which are likely 
to be made from that ordinary revenue as it ftands 
at prefent. 

THE public funds of the different indebted 
nations of Europe, particularly thofe of Eng- 
land, have by one author been reprefented as the 
accumulation of a great capital fuperaddecl to 
the other capital of the country, by means of 
which its trade is extended, its manufactures 
are multiplied, and its lands cultivated and im- 

* It has proved more expenfive than any of our former 
vrars; and has involved us in an additional debt of more than 
one hundred millions. During a profound peace of eleven 
years, little more than ten millions of debt was paid ; during 
a war of feven years, more than one hundred millions was 
contracted. 

proved 



THE WEALTH OF NATIONS. 4*5 

proved much beyond what they could have been C HA p. 
by means of that other capital only. He does 
not confider that the capital which the firft credi- 
tors of the public advanced to government, 
was, from the moment in which they advanced 
it, a certain portion of the annual produce turned 
away from ferving in the funclion of a capital, 
to ferve in that of a revenue ; from maintaining 
productive labourers to maintain unproductive 
ones, and to be fpent and waited, generally in 
the courfe of the year, without even the hope of 
any future reproduction. In return for the 
capital which they advanced, they obtained, in- 
deed, an annuity in the public funds in molt 
cafes of more than equal value. This annuity, 
no doubt, replaced to them their capital, and en- 
abled them to carry on their trade and bufmefs 
to the fame or perhaps to a greater extent than 
before; that is, they were enabled either to 
borrow of other people a new capital upon the 
credit of this annuity, or by felling it to get 
from other people a new capital of their own, 
equal or fuperior to that which they had ad- 
vanced to government. This new capital, how- 
ever, which they in this manner either bought 
or borrowed of other 'people, mud have exifled 
in the country before, and mud have been em- 
ployed as all capitals are, in maintaining pro- 
ductive labour. When it came into the hands 
of thofe who had advanced their money to go- 
vernment, though it was in fome refpects a new 
capital to them, it was not fo to the country; 
but was only a capital withdrawn from certain 

employ-. 



4 a6 THE NATURE AND CAUSES OF 

BOOK employments in order to be turned towards 
otners - Though it replaced to them what they 
had advanced to government, it did not replace 
it to the country. Had they not advanced this 
capital to government, there would have been 
in the country two capitals, two portions of the 
annual produce, inflead of one, employed in main- 
taining productive labour. 

WHEN for defraying the expence of govern- 
ment a revenue is raifed within the year from 
the produce of free or unmortgaged taxes, a 
certain portion of the revenue of private people 
is only turned away from maintaining one fpecies 
of unproductive labour, towards maintaining 
another. Some part of what they pay in thofe 
taxes might no doubt have been accumulated 
into capital, and confequently employed in 
maintaining productive labour j but the greater 
part would probably have been fpent, and con- 
fequently employed in maintaining unproductive 
labour, The public expence, however, when de- 
frayed in this manner, no doubt hinders more or 
lefs the further accumulation of new capital ; but 
it does not neceffarily occafion the deftruction of 
any actually exifting capital. 

WHEN the public expence is defrayed by 
funding, it is defrayed by the annual deftruftion 
of fome capital which had before exifted in the 
country 5 by the perverfion of fome portion of 
the annual produce which had before been 
deftined for the maintenance of productive la- 
bour, towards that of unproductive labour. As 
in this cafe, however, the taxes are lighter than 

they 



THE WEALTH OF NATIONS. 427 

they would have been, had a revenue fufficient CHAP, 
for ' defraying the fame expence been raifed with- 
in the year ; the private revenue of individuals 
is neceflarily lefs burdened, and confequently 
their ability to fave and accumulate fome part of 
that revenue into capital is a good deal lefs im- 
paired. If the method of funding deftroy more 
old capital, it at the fame time hinders lefs* the 
accumulation or acquifition of new capital, than 
that of defraying the public expence by a re- 
venue raifed within the year. Under the fyftem 
of funding, the frugality and induflry of private 
people can more eafily repair the breaches which 
the wafte and extravagance of government may 
occafionally make in the general capital of the 
fociety. 

IT is only during the continuance of war, 
however, that the fyftem of funding has this ad- 
vantage over the pther fyftem. Were the ex- 
pence of war to be defrayed always by a revenue 
raifed withirj the -year, the taxes from which that 
extraordinary revenue was drawn would lafl no 
longer than the war. The ability of private peo- 
ple to accumulate, though lefs during the war, 
would have been greater during the peace than 
under the fyftem of funding. War would not 
necefiarily have occafioned the deftruction of any 
old capitals, and peace would have occafioned 
the accumulation of many more new. Wars 
would in general be more fpeedily concluded, 
and lefs wantonly undertaken. The people feel- 
ing, during the continuance of war, the com- 
plete burden of it, would foon grow weary of it, 

and 



428 THE NATURE AND CAUSES OF 

BOOK and government, in order to humour them, would 
not be under the neceflity of carrying it on longer 
than it was necefiary to do fo. The forefight of 
the heavy and unavoidable burdens of war would 
hinder the people from wantonly calling for it 
when there was no real or folid intereft to fight 
for. The feafons during which the ability of 
private people to accumulate was fomewhat im- 
paired, would occur more rarely, and be of {hotter 
continuance. Thofe, on the contrary, during 
which that ability^ was in the higheft vigour, would 
be of much longer duration than they can well be 
under the fyflem of funding. 

WHEN funding, befides, has made a certain 
progrefs, the multiplication of taxes which it 
brings along with it fometimes impairs as much 
the ability of private, people to accumulate even, 
in time of peace, as the other fyflem would in 
time of war. The peace revenue of Great Bri- 
tain amounts at prefent to more than ten millions 
a year. If free and unmortgaged, it might be 
fufficient, with proper management jand without 
contra&ing a milling of new debt, to carry on 
the moft vigorous war. The private revenue of 
the inhabitants of Great Britain is at prefent as 
much incumbered in time of peace, their ability 
to accumulate it as much impaired as it would 
have been in the time of the mod expenfive war, 
had the pernicious fyftem of funding never been 
adopted. 

IN the payment of the intereft of the public 
debt, it has been faid, it is the right hand which 
pays the left. The money does not go out of 

the 



THE WEALTH OF NATIONS* 429 

the country. It is only a part of the revenue of c H A P. 
one fet of the inhabitants which is transferred to . IIL 
another $ and the natiqn is not a farthing the 
poorer. This apology is founded altogether in the 
fophiflry of the mercantile fyflem $ and after the 
long examination which I have already bellowed 
upon that fyflem, it may perhaps be unnecefiary 
to fay any thing further about it. It fuppofes, 
befides, that the whole public debt is owing to 
the inhabitants of the country, which happens 
not to be true ; the Dutch, as well as feveral other 
foreign nations, having a very confiderable fliare 
in our public funds. But though the whole 
debt were owing to the inhabitants of the coun- 
try, it would not upon that account be lefs per- 
nicious. 

LAND and capital flock are the two original 
fources of all revenue both private and public. 
Capital flock pays the wages "of productive la- 
bour, whether employed in agriculture, manu- 
factures, or commerce. The management of 
thofe two original fources of revenue belongs to 
two different fets of people ; the proprietors of 
land, and the owners or employers of capital 
flock. 

THE proprietor of land is interefled for the 
fake of his own revenue to keep his eflate in as 
good condition as he can, by building and re-, 
pairing his tenants houfes, by making and main- 
taining the neceffary drains and enclofures, and 
all thofe other expenfive improvements which it 
properly belongs to the landlord tQ make and 
maintain. But by different land-taxes the re- 
venue 



THE NATURE AND CAUSES OF 

BOOK venue of the landlord may be fo much dimi- 
nifhed; and- by different duties upon the necef- 
faries and conveniencies of life, that diminimed 
revenue may be rendered of fo little real value, 
that he may find himfelf altogether unable to 
make or maintain thofe expenfive improvements* 
"When the landlord, however, ceafes to do his part, 
it is altogether impoflible that the tenant mould 
continue to do his. As the diflrefs of the land- 
lord increafes, the agriculture of the country mud 
neceffarily decline. 

WHEN, by different taxes upon the neceffaries 
and conveniencies of life, the owners and em- 
ployers of capital flock find, that whatever re-* 
venue they derive from it, will not, in a particular 
country, purchafe the fame quantity of thofe ne- 
/ ceffaries and conveniencies which* an equal re- 
venue would in almofl any other, they will be 
difpofed to remove to fome other. And when, in 
order to raife thofe taxes, all or the greater part 
of merchants and manufacturers, that is, all of 
the greater part of the employers of great eapi* 
tals, come to be continually expofed to the mor- 
tifying and vexatious vifits of the tax-gatherers/ 
this difpofition to remove will foon be changed 
into an actual removing. The induflry of the 
country will neceffarily fall with the removal of 
the capital which fupported it, and the ruin of 
trade and manufactures will follow the declenfion 
of agriculture. ^ 

To transfer from the owners of thofe two great 
fources of revenue^ land and capital flock, from 
t the perfons immediately interefted in the good 

condition 



THE WEALTH OF NATIONS. 431 

condition of every particular portion of land, CHAP. 
and in the good management of every particular 
portion of capital flock, to another let of perfons 
(the creditors of the public, who have no fuch 
particular intereft), the greater part of the reve- 
nue arifmg from either muft, in the long run, 
occafion both the neglect of land, and the waite 
or removal of capital flock. A creditor of the 
public has no doubt a general intereft in the pro- 
iperity of the agriculture, manufactures, and com- 
merce of the country ; and confequently in the 
good condition of its lands, and in the good 
management of its capital flock. Should there 
be any general failure or declenfion in any of 
thefe things, the produce of the different taxes 
might no longer be fufficient to pay him the an- 
nuity or intereft which is due to him. But a 
creditor of the public, confidered merely as fuch, 
has no intereft in the good condition of any par- 
ticular portion of land, or in the good manage- 
ment of any particular portion of capital flock. 
As a creditor of the public he has no knowledge of 
any fuch particular portion. He has ho infpection 
of it. He can have no care about it. Its ruin 
may in fome cafes be unknown to him, and can- 
not directly affecl him. 

THE practice of funding has gradually en- 
feebled every ftate which has adopted it. The 
Italian republics feem to have begun it. Genoa 
and Venice, the only two remaining which can 
pretend to an independent exiflence, have both 
been enfeebled by it. Spain feems to have 
learned the pra&ice from the Italian republics, 

and 



43 2 THE NATURE AND CAUSES OF 

BOOK and (its taxes being probably lefs judicious thatt 
theirs) it has, in proportion to its natural ftrength, 
been flill more enfeebled. The debts of Spain I 
are of very old (landing. It was deeply in debt 
before the end of the fixteenth century, about a 
hundred years before England owed a {hilling. 
France, notwithstanding all its natural refources, 
languifhes under an oppreffive load of the fame 
kind. The republic of the United Provinces is 
as much enfeebled by its debts as either Genoa 
or Venice. Is it -likely that in Great Britain alone 
a practice, which has brought either weaknefs or 
defolation into every other country, mould prove 
altogether innocent ? 

THE fyftem of taxation eftablifhed in thofe 
different countries, it may be faid, is inferior to 
that of England. I believe it is fo. > But it 
ought to be remembered, that when the wifeft 
government has exhaufted all the proper fub- 
jecls of taxation, it muft, in cafes of urgent ne- ' 
ceffity, have recourfe to improper ones. The 
wife republic of Holland has upon fome occa- 
fions been obliged to have recourfe to taxes as 
inconvenient as the greater part of thofe of 
Spain. Another war begun before any confider- 
able liberation of the public revenue had been 
brought about, and growing in its progrefs as 
expenfive as the laft war, may, from irrefiftible 
neceflity, render the Britiih fyftem of taxation as 
oppreffive as that of Holland, or even as that of 
Spain. To the honour of our pjrefent fyftem of 
taxation, indeed, it has hitherto given fo little 
embarraffment to induftry, thit, during the 
7 courfe 



THE WEALTH OF NATIONS. 433 

cotorfe even of the mofl expend ve wars, the fru- c 
gality and good conduct of individuals feem to 
have been able, by faving and accumulation, to 
repair all the breaches which the wafte and ex- 
travagance of government had made in the ge- 
neral capital of the fociety. At the conclufion 
of the late war, the mofl expenfive that Great 
Britain ever waged, her agriculture was as flou- 
rifhing, her manufacturers as numerous and as 
fully employed, and her commerce as extenfive, 
as they had ever been before. The capital, 
therefore, which fupported all thofe different 
branches of induftry, muft have been equal to 
what it had ever been before. Since the peace, 
agriculture has been flill further improved, the 
rents of houfes have rifen in every town and vil- 
lage of the country, a proof of the increafmg 
wealth and revenue of the people ; and the an- 
nual amount of the greater part of the old taxes, 
of the principal branches of the excife and cuf- 
toms in particular, has been continually increaf- 
ing, an equally clear proof of an increafing 
confumption, and confequently of an increafing 
produce, which could alone fupport that con- 
furnption. Great Britain feems' to fupport with 
eafe, a burden which, half a century ago, no- 
body believed her capable of fupporting. Let 
us not, however, upon this account rafhly con- 
clude that me is capable of fupporting any bur- 
den ; nor even be to.o confident that fhe could 
fupport, without great diflrefs, a burden a little 
greater than what has already been laid upon 
her. 
,,VOL. in. F e WHEN 



434 THE NATURE AND CAUSES OF 

BOOK WHEN national debts have once been accu- 
mulated to a certain degree, there is fcarce, I 
believe, a fmgle inftance of their having been 
fairly and completely paid. The liberation of 
the public revenue, if it has ever been brought 
about at all, has always been brought about by a 
bankruptcy ; fometimes by an avowed one, but 
always by a real one, though frequently by a 
pretended payment. 

THE railing of the denomination of the coin 
has been the mofl ufual expedient by which a 
real public bankruptcy has been difguifed un- 
der the appearance of a pretended payment. If 
a fixpence, for example, fhould either by aft of 
parliament: or royal proclamation be raifed to 
the denomination of a (hilling, and twenty fix- 
pences to that of a pound flefling, the perfon 
who under the old denomination had borrowed 
twenty fhillings, or near four ounces of filver, 
would under the new, pay with twenty fix- 
pences, or with fomething lefs than two ounces. 
A national debt of about a hundred and twenty- 
eight millions, nearly the capital of the funded 
and unfunded debt of Great Britain, might in 
this manner be paid with about fixty-four mil- 
lions of our prefent money. It would indeed 
be a pretended payment only, and -the creditors 
of the public would really be defrauded of ten 
Ihillings in che pound of what was due to them. 
The calamity too would extend much further 
than to the creditors of the public, and thofe of 
every private perfon would fuller a proportion- 
able lofsj and this without any advantage, but 

ia 



THE WEALTH OF NATIONS/ 435 

in mod cafes with a great additional lofs, to the C II A p. 
creditors of the pu' lie. If the creditors of the ,__ 
public indeed were generally much in debt to 
other people, they might in fome meafufe com- 
penfate their lofs by paying their creditors in the 
fame coin in which the public had paid them- 
.But in moft countries the creditors of the pub- 
lic are, the greater part of them, wealthy peo- 
.pie, who (land more in the relation of credit- 
ors than in that of debtors towards the reft of 
their fellow-citizens. A pretended payment of 
this kind, therefore, inflead of alleviating^ ag- 
f gravates in moft cafes the lofs of the creditors of 
the public ; and without any advantage to the 
public, extends the calamity to a great number 
-of other innocent people. It occafions a gene- 
ral and moft pernicious fubverfion of the for- 
tunes of private people ; enriching in moft cafes 
.the idle and profufe debtor at the expence of the 
induftrious and frugal creditor, and tranfporting 
,a great part of the national capital from the 
hands which were likely to increafe and improve 
it, to thofe which are likely to diffipate and de- 
.ftroy it. When it becomes neceffary for a ftate 
to declare itfelf bankrupt, in the fame manner as 
/when it becomes neceilary for an individual to 
do fo, a fai$, open, and avowed bankruptcy is 
always the meafure which is both leaft difho- 
nourable to the debtor, and leaft hurtful to the 
creditor. The honour of a ftate is furely very 
poorly provided for, when, in order to cover the 
difgrace of a real bankruptcy, it has recourfe to 
a juggling trick of this kind, fo eafily feea 
F F 2 through, 



tf6 THE, NATURE AND CAUSES OF' 

BOOK through, and at the fame time fo extremely per- 
nicious* 

ALMOST all dates, however, ancient as well 
as modern, when reduced to this neceflity,. have, 
upon fome occafions, played this very juggling 
trick. The Romans, at the end of the firft 
Punic war, reduced the As, the coin or deno- 
nomination by which they computed the value 
of all their other coins, from containing twelve 
ounces of copper to contain only two ounces : 
that is, they raifed two ounces of copper to a 
denomination which had always before exprefled 
the value of twelve ounces. The republic was, 
in this manner, enabled to pay the great debts 
which it had contracted with the fixth part of 
what it really owed. So fudden and fo great a 
bankruptcy, we mould in the prefent times be 
apt to imagine, mud have occafioned a very 
violent popular clamour. It does not appear to 
have occafioned any. The law which enaded k 
was, like all other laws relating to the coin> in- 
troduced and carried through the aflembly of 
the people by a tribune, and was probably a very 
popular law. In Rome, as in all the other an. 
cient republics, the poor people were conftant- 
ly in debt to the rich and the great, who, in 
order to fecure their votes at the annual elec- 
tions, ufed to lend them money at exorbitant in* 
tereft, which, being never paid, foon accumu 
lated into a fum too great either for the debtor 
to pay, or for any body elfe to pay for him. The 
debtor, for fear of a very fevere execution, was 
obliged, without any further gratuity, to vote 

for 



THE WEALTH OF NATIONS. 437 

for the candidate whom the creditor recom- CHAP, 
mended. In fpite of all the laws againft bribery u- 
and corruption, the bounty of the candidates, 
together with the occafional diflributions of coin 
which were ordered by the fenate, were the prin- 
cipal funds from which, during the latter times 
of the Roman republic, the poorer citizens de- 
rived their fubfiftence. To deliver themfelves 
from this fubjection to their creditors, the poorer 
citizens were continually calling out either for 
an entire abolition of debts, or for what they 
called New Tables ; that is, for a law which 
fhould entitle them to a complete acquittance; 
upon paying only a certain proportion of their 
accumulated debts. The law which reduced 
fhe coin of all denominations to a fixth part of 
its former value, as it enabled them to pay their 
debts with a fixth part of what they really owed, 
was equivalent to the moft advantageous new 
tables. In order to fatisfy the people, the rich 
and the great were, upon feveral different occa- 
fions, obliged to confent to laws both for abo- 
liming deb$s, and for introducing new tables j 
and they probably were induced to confent to 
this law, partly for the fame reafon, and part- 
ly that, by liberating the public revenue, they 
might reftore vigour to that government of 
which they themfelves had the principal direc- 
tion. An operation of this kind would at once 
reduce a debt of a hundred a.nd twenty-eight 
millions to twenty-one millions three hundred 
and thirty-three thoufand three hundred an4 
thirty-three pounds fix fhillings and eight- 
F F 3 pence* 




THE NATURE AND CAUSES OF 

pence. In the courfe of the fecond Punic war 
the As was {till further reduced, firft, from two 
ounces of copper to one ounce - 9 and afterwards 
from one ounce to half an ounce ; that is, to the 
twenty-fourth part of its original value. By com- 
bining the three Roman operation^ into one, a 
debt of a hundred and twenty-eight millions of 
OUT prefent money, might in this manner be re- 
duced all at once to a debt of five millions three 
hundred and thirty-three thoufand three hundred 
and thirty-three pounds fix millings and eight- 
pence. Even the enormous debt of Great Britain 
might in this manner foon be paid. 

BY means of fuch expedients the coin of, I 
believe, all nations has been gradually reduced 
more and more below its original value, and the 
fame nominal fum has been gradually brought to 
contain a fmaller and a fmaller quantity of filver. 

NATIONS have fometimes, for the fame pur- 
pofe, adulterated the flandard of their coin ; 
that is, have mixed a greater quantity of alloy in 
it. If in the pound weight of our filver coin, 
for example, inftead of eighteen penny-weight, 
according to the prefent flandard, there was 
mixed eight ounces of alloy ; a pound (lerling, 
or twenty (hillings of fnch coin, would be worth 
little more than fix {hillings and eight-pence of 
our prefent money. The quantity of filver con- 
tained in fix {hillings and eight-pence of our 
prefent money, would thus be raifed very nearly 
to the denomination of a pound fterling. The 
adulteration of the ftandard has exactly the fame 
with what the French call an augmentation, 

or 



THE WEALTH OF NATIONS. 439 

or a direct railing of the denomination of the CHAP 
coin. Ul 

AN augmentation, or a direct railing of the 
denomination of the coin, always is, and from 
its nature mud be, an open and avowed opera- 
tion. By means of it pieces of a fmaller weight 
and bulk are called by the fame name which had 
before been given to pieces of a greater weight 
and bulk. The adulteration of the ftandarcl, on 
the contrary, has generally been a concealed 
operation. By means of it pieces were iflued 
from the mint of the fame denominations, and, 
as nearly as could be contrived, of the fame 
weight, bulk, and appearance, with pieces which 
had been current before of much greater value. 
When king John of France *, in order to pay his 
debts, adulterated his coin, all the officers of 
his mint were fworn to fecrecy. Both operations 
are unjuft. But a fimple augmentation is an in- 
juflice of open violence ; whereas an adulteration 
is an injuftice of ^treacherous fraud. This latter 
operation, therefore, as foon as it has been dif- 
covered, and it could never be concealed very 
long, has always excited much greater indignation 
than the former. The coin after any confiderable 
augmentation has very feldom been brought back 
to its former weight ; but after the greateft adul- 
terations it has almoft always been brought back 
to its former finenefs. It has fcarce ever happened 
that the fury and indignation of the people could 
otherwife be appeafed. 

* See Du Cange Gloflaiy, voce Montta 5 the BfiioliiUne 
edition. 

F P 4 IN 




THE NATURE AND CAUSES OF 
IN the end of the reign of Henry VIII. and in 
the beginning of that of Edward VI. the Englifh 
coin was not only raifed in its denomination, but 
adulterated in its ftandard. The like frauds 
were pradifed in Scotland during the minority of 
James VI. - They have occasionally been pradifed 
in moft other countries. 

THAT the public revenue of Great Britain can 
never be completely liberated, or even that 
any confiderable progrefs can ever be made to- 
wards that liberation* while the furplus of that 
revenue, or what is over and above defraying 
the annual expence of the peace eftablimment, is 
fo very fmall, it feems altogether in vain to ex- 
pect. That liberation, it is evident, can never 
be brought about without either fome very con- 
fiderable augmentation of the public revenue, or 
fome equally confiderable reduction of the public 
expence. 

A MORE equal land-tax, a more equal tax upon 
the rent of houfes, and fuch alterations in the pre- 
fent fyflem of cufloms and excife as thofe which 
have been mentioned in the foregoing chapter, 
might, perhaps, without increafmg the burden of 
the greater part of the people, but only diflribut- 
ing the weight of it more equally upon the whole, 
produce a confiderable augmentation of revenue* 
The mod fanguine projector, however, could 
fcarce flatter himfelf that any augmentation of 
this kind would be fuch as could give any rea- 
fonable hopes, either of liberating the public re- 
venue altogether, or even of making fuch pro- 
grefs towards that liberation in time of peace, as 

either 



THE WEALTH OF NATIONS. 441 

either to prevent or to compenfate the further c H A p. 

accumulation of the public debt in the next 

war. 

By extending the Britifh fyftem of taxation to 
all the different provinces of the empire inhabited 
by people of either Britifh or European extrac- 
tion, a much greater augmentation of revenue 
might be expected. This, however, could fcarce, 
perhaps, be done, confidently with the principles 
of the Britifli conftitution, without admitting into 
the Britifh parliament, or if you will into the 
ftates-general of the Britifh empire, a fair and 
equal repreientation of all thofe different pro- 
vinces, that of each province bearing the fame 
proportion to the produce of its taxes, as the 
reprefentation of Great Britain might bear to the 
produce of the taxes levied upon Great Britain. 
The private intereft of many powerful indivi- 
duals, the confirmed prejudices of great bodies 
of people feem, indeed, at prefent, to oppofe 
to fo great a change fuch obftacles as it may be 
very difficult, perhaps altogether impoffible, to 
furmount. Without, however, pretending to 
determine whether fuch a union be practicable of 
impracticable, it may not, perhaps, be impro- 
per, in a fpeculative work of this kind, to con- 
fider how far the Britifh fyftem of taxation might 
be applicable to all the different provinces of the 
empire ; what revenue might be expefted from 
it if fo applied, and in what manner a general 
union of this kind might be likely to affect the 
happinefs and profperity of the different provinces 
comprehended within it. Such a fpeculation can 

at 



442 THE NATURE AND CAUSES OF 

BOOK at word be regarded but as a new Utopia, lefs 
amufmg certainly, but not more ufelefs and chi- 
merical than the old one. 

THE land- tax, the ftamp- duties, and the dif- 
ferent duties of cuftoms and excife, conftitute 
the four principal branches of the Britifh taxes. 

IRELAND is certainly as able, and our Ameri- 
can and Wed Indian plantations more able to 
pay a land-tax than Great Britain. Where the 
landlord is fubjecl neither to tithe nor poors rate, 
he muft certainly be more able to pay fuch a tax, 
than where he is fubjecl: to both thofe other 
burdens. The tithe, where there is no modus, 
and where it is levied in kind, diminifhes more 
xvhat would otherwife be the rent of the landlord, 
than a land-tax which really amounted to five 
{hillings in the pound. Such a tithe will be 
found in moft cafes to amount to more than a 
fourth part of the real rent of the land, or of 
what remains after replacing completely the capi- 
tal of the farmer, together with his reafonable 
profit. If all modufes and all impropriations 
were taken away, the complete church tithe of 
Great Britain and Ireland could not well be efti- 
mated at-lefs than fix or feven millions. If there 
was no tithe either in Great Britain or Ireland, 
the landlords could afford to pay fix or feven 
millions additional land tax, without being more 
burdened than a very great part of them are at 
prefent. America pays no tithe, and could 
therefore very well afford to pay a land-tax. 
The lands in America and the Weft Indies in- 
deed, are in general not tenanted nor leafed out 

to 



THE WEALTH OF NATIONS. 443 

to farmtrs. They could not therefore be afieffed CHAP, 
according to any rent roll. But neither were the 
lands of Great Britain, in the 4th of William 
and Mary, affcfied according to any rent-roll, 
but according to a very loole and inaccurate efti- 
roation. The lands in America might be aflefled 
either in the '<une manner, or according to an 
equitable valuation in confequence of an accurate 
furvey, like' that which was lately made in the 
Milanele, and in the dominions of Auftria, Pruf- 
fia, and Sardinia. 

STAMP-DUTIES, it is evident, might be levied 
without any variation in all countries where the 
forms of law procefs, and the deeds by which 
property both real and perfonal is transferred, are 
the fame or nearly the fame. 

THE extenfion of the cuftom-houfe laws of 
Great Britain to Ireland and the plantations, pro- 
vided it was accompanied, as in juftice it ought 
to be, with an extenfion of the freedom of trade, 
would be in the highefl degree advantageous to 
both. All the invidious reftraints which at pre- 
fent opprefs the trade of Ireland, the diftin&ion 
between the enumerated and non-enumerated 
commodities of America, would be entirely at 
an end. The countries north of Cape Finifterre 
would be as open to every part of the produce 
of America, as thofe fouth of that Cape are to 
fome parts of that produce at prefent. The trade 
between all the different parts of the Britifh em- 
pire would, in confequence of this uniformity in 
the cuftom-houfe laws, be as free as the coafting 
trade of Great Britain is at prefent. The Britifh 

empire 



444 THE NATURE AND CAUSES OF 

BOOK empire would thus afford within itfelf an inv 
menfe internal market for every part of the pro- 
duce of all its different provinces. So great an 
extenfion of market would foon compenfate both 
to Ireland and the plantations, all that they could 
fuffer from the increafe of the duties of cuftoms. 

THE excife is the only part of the Britim 
fyflem of taxation, which would require to be 
varied in any refpect according as it was applied 
to the different provinces of the empire, It 
might be applied to Ireland without any varia- 
tion ; the produce and confumption of that king- 
dom being exactly of the fame nature with thofe 
of Great Britain. In its application to America 
and the Weft Indies, of which the produce and 
confumption are fo very different from thofe of 
Great Britain, fome modification might be necef- 
fary in the fame manner as in its application to 
the cyder and beer counties of England. 

A FERMENTED liquor, for example, which is 
called beer, but which, as it is made of melaffes, 
bears very little refemblance to our beer, makes 
a confiderable part of the common drink of the 
people in America. This liquor, as it can be 
kept only for a few days, cannot, like our beer, 
be prepared and ftored up for fale in great brew- 
cries ; but every private family muft brew it 
for their own ufe, in the fame manner as they 
cook their victuals. But to fubjecl every private 
family to the odious vifits and examination of 
the tax-gatherers, in the fame manner as we fub- 
jecl: the keepers of alehoufes and the brewers for 
public fale, would be altogether inconfiftent 

with 



TttE WEALTH OF NATldNS. 44$ 

with liberty. If for the fake of equality it was CHAP. 
thought necefifary to lay a tax upon this liquor^ 
it might be taxed by taxing the material of 
which it is made, either at the place of manu- 
facture, or, if the circumftances of the trade ren- 
dered fuch an excife improper, by laying a duty 
upon its importation into the colony in which it 
was to be confumed. Befides the duty of one 
penny a gallon impofed by the Britifh parliament 
upon the importation of melafles into America ; 
there is a provincial tax of this kind upon their 
importation into Maflachufett's Bay, in fhips be- 
longing to any other colony, of eight-pence the 
hogfhead ; and another upon their importation, 
from the northern colonies into South Carolina, 
of five- pence the gallon. Or if neither of thefe 
methods was found convenient, each family 
might compound for its confurnption of this li- 
quor, either according to the number of perfons 
of which it confided, in the fame manner as pri- 
vate families compound for the malt tax in Eng- 
land ; or according to the different ages and 
fexes of thofe perfons, in the fame manner as 
feveral different taxes are levied in Holland ; or 
nearly as Sir Matthew Decker propofes that all 
taxes upon confumable commodities fhould be 
levied in England. This mode of taxation, it has 
already been obferved, when applied to objects of 
a fpeedy confurnption, is not a very convenient 
one. It might be adopted, however, in cafes 
where no better could be done. 

SUGAR, rum, and tobacco, are commodities 
which are no where neceflaries of life, which are 

become 



446 THE NATURE AND CAUSES OF 

BOOK become objeds of almoft univerfal confumptioff, 
and which are therefore extremely proper fub- 
jc&s of taxation. If a union with the colonies 
were to take place, thofe commodities might be 
taxed either before they go out of the hands of 
the manufacturer or grower ; or if this mode of 
taxation did not fuit the circumflances of thofe 
perfons, they might be depofited in public ware- 
houfes both at the place of manufacture, and at 
all the different ports of the empire to which 
they might afterwards be tranfported, to remain 
there, under the joint cuftody of the owner and 
the revenue officer, till fuch time as they mould 
be delivered out either to the confumer, to the 
merchant retailer for home-confumption, or to 
the merchant exporter, the tax not to be ad- 
vanced till fuch delivery. When delivered out 
for exportation, to go duty free ; upon proper 
fecurity being given that they mould really be 
exported out of the empire. Thefe are perhaps 
the principal commodities with regard to which 
a union with the colonies might require fome con- 
fiderable change in the prefent fyftem of Britifh 
taxation. 

WH^T might be the amount of the revenue 
which this fyftem of taxation extended to all the 
different provinces of the empire might produce, 
it muft, no doubt, be altogether impoffible to 
afcertain with tolerable exadnefs. By means of 
this fyftem there is annually levied in Great Bri- 
tain, upon lefs than eight millions of people, 
more than ten millions of revenue. Ireland 
contains more than two millions of people, and 

according 



THE WEALTH OF NATIONS. 447 

according to the accounts laid before the congrefs, C H A p. 
the twelve affpciated provinces of America con- 
tain more than three. Thofe accounts, how- 
ever, may have been exaggerated, in order, per- 
haps, either to encourage their own people, or 
to intimidate thofe of this country, and we mall 
fuppofe therefore that our North American and 
Weft Indian colonies taken together contain no 
more than three millions ; or that the whole 
Britiih empire, in Europe and America, contains 
no more than thirteen millions of inhabitants. 
If upon left than eight millions of inhabitants 
this fyftem of taxation raifes a revenue of more 
than ten millions flerling ; it ought upon thir- 
teen millions of inhabitants to raife a revenue of 
more than fixteen millions two hundred and fifty 
thoufand pounds fterling. From this revenue, 
fuppofing that this fyftem could produce it, muft 
be deducted, the revenue ufually raifed in Ire- 
land and the plantations for defraying the ex- 
pence of their refp5tive civil governments. The 
expence of the civil and military eftablifhment 
of Ireland, together with the intereft of the 
public debt, amounts, at a medium of the 
two years which ended March 1775, to fome- 
thing lefs than feven hundred and fifty thou- 
fand pounds a year. By a very exacl; account of 
the revenue of the principal colonies of Ame- 
rica and the Weft Indies, it amounted, before 
the commencement of the prefem difturbances, 
to a hundred and forty-one thoufand tight 
hundred pounds. In this account, however, 
the revenue of Maryland, of North Carolina, 

and 



44$ THE NATURE ANtf CAUSES OF 

BOOK and of all our late acquisitions both upon the 
continent and in the iflands, is omitted.; which 
may perhaps make a difference of thirty or 
forty thoufand pounds. For the fake of even 
numbers therefore, let us fuppofe that the re- 
venue necefiary for fupporting the civil go- 
vernment of Ireland and the plantations, may 
amount to a million. There would remain con- 
fequently a revenue of fifteen millions two hun- 
dred and fifty thoufand pounds, to be applied 
towards defraying the general expence of the 
empire, and towards paying the public debt. 
But if from the prefent revenue of Great Britain 
a million could in peaceable times be fpared to- 
wards the payment of that debt, fix millions two 
hundred and fifty thoufand pounds could very 
well be fpared from this improved revenue. 
This great finking fund too might be augmented 
every year by the intereft of the debt which had 
been difcharged the year before, and might in 
this manner increafe fo very rapidly, as to be 
fufficient in a few years to difcharge the whole 
debt, and thus to reflore completely the at pre- 
fent debilitated and languifhing vigour of the 
empire. In the mean time the people might be 
relieved from fome of the mod burdenfome taxes ; 
Trom thofe which are 'impofed either upon the 
necefiaries of life, or upon the materials of ma- 
nufacture. The labouring poor would thus be 
enabled to live better, to work cheaper, and to 
fend their goods cheaper to market. The cheap- 
nefs of their goods would increafe the demand 
for them, and confequently for the labour of 
8 thofe 



THE WEALTH OF NATIONS. 449 

thofe who produced them. This increafe in the c H A P. 
demand for labour, would both increafe the 
numbers and improve the circumflances of the 
labouring poor. Their confumption would in- 
creafe, and together with it the revenue arifing 
from all thofe articles of their confumption upon 
which the taxes might be allowed to remain. 

THE revenue arifing from this fyflem of tax- 
ation, however, might not immediately increafe 
in proportion to the number of people who were 
fubje&ed to it. Great indulgence would for 
fome time be due to thofe provinces of the em- 
pire which were thus fubjected to burdens to 
which they had not before been accuflomed, and 
even when the fame taxes came to be levied 
every where as exactly as poflible, they would 
not every where produce a revenue proportioned 
to the numbers of the people. In a poor country 
the confumption of the principal commodities 
fubject to the duties of cufloms and excife is very 
fmall ; and in a thinly inhabited country the op- 
portunities of fmuggling are very great. The 
confumption of malt liquors among the inferior 
ranks of people in Scotland is very fmall, and 
the excife upon malt, beer, and ale, produces 
lefs there than in England, in proportion to the 
numbers of the people and the rate of the duties, 
which upon malt is different on account ,of a fup- 
pofed difference of quality. In thefe particular 
branches of the excife, there is not, I apprehend, 
much more fmuggling in the one country han 
hi the other. The duties upon the diftillery, 
and the greater part of the duties of cufloms, in 

VOL, in. G G pro- 



45 o THE NATURE AND CAUSES OF 

BOOK proportion to the numbers of people in the re- 
fpedive countries, produce lefs in Scotland than 
in England, not only on account of the fmaller 
confumption of the taxed commodities, but of 
the much greater facility of fmuggling. In Ire- 
land, the inferior ranks of people are ftill poorer 
than in Scotland, and many parts of the coun- 
try are almoft as thinly inhabited. In Ireland, 
therefore, the confumption of the taxed com- 
modities might, in proportion to the number of 
the people, be ftill lefs than in Scotland, and the 
facility of fmuggling nearly the fame. In Ame- 
rica and the Weft Indies the white people even 
of the loweft rank are in much better circum- 
ftances than thofe of the fame rank in England, 
and their confumption of all the luxuries in which 
they ufually indulge themfelves, is probably much 
greater. The blacks, indeed, who make the 
greater part of the inhabitants both of the 
fouthern colonies upon the continent and of the 
Weft India iflands, as they are in a ftate of ila- 
very, are, no doubt, in a worfe condition than 
the pooreft people either in Scotland or Ireland. 
We mult not, however, upon that account, 
imagine that they are worfe fed, or that their 
confumption of articles which might be fubjefted 
to moderate duties is lefs than that even of the 
lower ranks of people in England. In order 
that they may work well, it is the intereft of their 
mafter that they mould be fed well and kept in 
good heart, in the fame manner as it is his in- 
tereft that his working cattle mould be fo. The 
blacks accordingly have almoft every where their 

allow- 



THE WEALTH OF NATIONS. 451 

allowance of rum and of melafles or fpruce beer, CHAP. 
in the fame manner as the white fervants ; and 
this allowance would not probably be withdrawn, 
though thofe articles mould be fubjeded to mo- 
derate duties. The confumption of the taxed 
commodities, therefore, in proportion to the 
number of inhabitants, would probably be as 
great in America and the Weft Indies as in any. 
part of the Britifh empire. The opportunities 
of fmuggling, indeed, would be much greater ; 
America, in proportion to the extent of the 
country, being much more thinly inhabited than 
either Scotland or Ireland. If the revenue, 
however, which is at prefent raifed by the dif- 
ferent duties upon malt and malt liquors, were to 
be levied by a fingle duty upon malt, the oppor- 
tunity of fmuggling in the mod important branch 
of the excife would be almoft entirely taken 
away : and if the duties of cuftoms, inftead of 
being impofed upon almoft all the different articles 
of importation, were confined to a few of the mod 
general ufe and confumption, and if the levying 
of thofe duties were fubjeded to the excife laws, 
the opportunity of fmuggling, though not fo 
entirely taken away, would be very mtich dimi- 
nifhed. In confequcnce of thofe two, apparently 
very fimple and eafy alterations, the duties of 
cuftoms and excife might probably produce a 
revenue as great in proportion to the confump- 
tion of the moft thinly inhabited province, as 
they do at prefent in proportion to that of the 
moft populous. 

c G 2 THS 




THE NATURE AND CAUSES OF 
THE Americans, it has been faid indeed, have 
no gold or filver money ; the interior commerce 
of the country being carried on by a paper cur- 
rency, and the gold and filver which occafionally 
.come among them being all fent to Great Bri- 
tain in return for the commodities which they 
receive from us. But without gold and filver, 
it is added, there is no poffibility of paying taxes. 
We already get all the gold and filver which they 
have* How is it pofiible to draw from them 
what they have not ? 

THE prefent fcarcity of gold and filver money 
in America is not the effect of the poverty of 
that country, or of the inability of the people 
there to purchafe thofe metals, In a country 
where the wages of labour is fo much higher, 
and the price of provifions fo much lower than 
in England, the greater part of the people muft 
furely have wherewithal to purchafe a greater 
quantity, if it were either neceflary or convenient 
for them to do fo. The fcarcity of thofe metals, 
therefore, rrmfl be the effect of choice, and not of 
neceflity. 

IT is for tranfa&ing either domeftic or foreign 
bufmefs, that gold and filver money is either ne- 
ceflary or convenient. 

THE domeftic bufinefs of every country, it 
has been fhewn in the fecond book of this In- 
quiry, may, at leafl in peaceable times, be tranf- 
acted by means of a paper currency, with 
nearly the fame degree of conveniency as by 
gold and filver money. It is convenient for 
the Americans, who could always employ with 

profit 



THE WEALTH OF NATIONS. 453 

profit in the improvement of their lands a greater CHAP. 
ftock than they can eafily get, to fave as much 
as poflible the expence of fo coftly an inftrument 
of commerce as gold and filver, and rather to 
employ that part of their furplus produce which 
would be necefTary for purchafmg thofe metals, 
in purchafmg the inftruments of trade, the ma- 
terials of clothing, feveral parts of houfehold 
furniture, and the iron work necefiary for build- 
ing and extending their fettlements and planta- 
tions ; in purchafmg, not dead ftock, but active 
and productive ftock. The colony governments 
find it for their intereft to fupply the people 
with fuch a quantity of paper-money as is fully 
fufficient and generally more than fufficient for 
tranfactiug their domeftic bufmefs. Some of 
thofe governments, that of Pennfylvania par- 
ticularly, derive a revenue from lending this 
paper-money to their fubjects, at an intereft of 
fo much per cent. Others, like that of Mafia- 
chufett's Bay, advance upon extraordinary emer- 
gencies a paper-money of this kind for defraying 
the public expence, and afterwards, when it 
fuits the conveniency of the colony, redeem it 
at the depreciated value to which it gradually 
falls. In 1747*, that colony paid in this man- 
ner the greater part of its public debts, with 
the tenth part of the money for which its bills 
had been granted. It fuits the conveniency of 
the planters to fave the expence of employing 
gold and filver money in their domeftic tranf- 

* See Hutchinfon's Hift. of Mafiachufett's Bay, Vol. II. 
page 436, & fccj. 

c G 3 actions j 




THE NATURE AND CAUSES t)F~ 
a&ions ; and it fuits the conveniency of the 
colony governments to fupply them with a me- 
dium, which^ though attended with fome very 
confiderable difadvantages, enables them to fave 
that expence. The redundancy of paper-money 
neceflarily banilhes gold and filver from the do- 
meftic tranfaftions of the colonies, for the fame 
reafon that it has banilhed thofe metals from the 
greater part of the domeftic tranfactions in 
Scotland, and in both countries it is not the po- 
verty, but the enterprifing and projecting fpirit of 
the people, their defire of employing all the flock 
which they can get as active and productive 
flock, which has occafioned this redundancy of 
paper-money. 

IN the exterior commerce which the different 
colonies carry on with Great Britain, gold and 
filver are more or lefs employed, exactly in pro-i 
portion as they are more or lefs neceffary. Where 
thofe metals are not neceffary, they feldom ap- 
pear. Where they are necefiary, they are gene- 
rally found. 

IN the commerce between Great Britain and 
the tobacco colonies, the Britifh goods are gene- 
rally advanced to the colonifls at a pretty long 
credit, and are afterwards paid for in tobacco 
rated at a certain price. . It is more convenient 
for the colonifts to pay in tobacco than in gold 
and filver. It would be more convenient for 
any merchant to pay for the goods which his 
correfpondents had fold to him in fome other fort 
of goods which he might happen to deal in, than 
in money. Such a merchant would have no oc- 

cafioa 



THE WEALTH OF NATIONS. 455 

cafion to keep any part of his flock by him un- CHAP. 
employed, and in ready money, for anfwering 
occafional demands. He could have, at all 
times, a larger quantity of goods in his mop or 
warehoufe, and he could deal to a greater ex- 
tent. But it feldom happens to be convenient 
for all the correfpondents of a merchant to re- 
ceive payment for the goods which they fell to 
him, in goods of fome other kind which he hap- 
pens to deal in. The Britifh merchants who 
trade to Virginia and Maryland happen to be a 
particular fet of correfpondents, to whom it is 
more convenient to receive payment for the 
goods which they fell to thofe colonies in tobacco 
than in gold and filver. They expe6t to make 
a profit by the fale of the tobacco. They could 
make none by that of the gold and filver.- Gold 
and filver, therefore, very feldom appear in the 
commerce between Great Britain and the tobacco 
colonies. Maryland and Virginia have as little 
occafion for thofe metals in their foreign as in 
their domeflic commerce. They are faid, ac- 
cordingly, to have lefs gold and filver money than 
any other colonies in America. They are reckoned, 
however, as thriving, and confequently as rich, 
as any of their neighbours. 

IN the northern colonies, Pennfylvania, New 
York, New Jerfey, the four governments of 
New England, &c. the value of their own pro- 
duce which they export to Great Britain is not 
equal to that of the manufactures which they 
import for their own ufe, and for that of feme 
of the other colonies to which they are the car- 
004 riers. 



45 6 THE NATURE AND CAUSES OF 

BOOK riers. A balance therefore muft be paid to the 
mother country in gold and filver, and this balance 
they generally find. 

IN the fugar colonies the value of the produce 
annually exported to Great Britain is much 
greater than that of all the goods imported from 
thence. If the fugar and rum annually fent to 
the mother-country were paid for in thofe colo- 
nies, Great Britain would be obliged to fend out 
every year a very large balance in money, and 
the trade to the Weft Indies would, by a certain 
fpecies of politicians, be confidered as extremely 
difadvantageous. But it fo happens, that many of 
the principal proprietors of the fugar plantations 
refide in Great Britain. Their rents are remitted 
to them in fugar and rum, jthe produce of their 
eflates. The fugar and rum which the Weft 
India merchants purchafe in thofe colonies upon 
their own account, are not equal in value to the 
goods which they annually fell there. ' A balance, 
therefore, muft neceffarily be paid to them iri 
gold and filver, and this balance too is generally- 
found. 

THE difficulty and irregularity of payment 
from the different colonies to Great Britain, have 
not been at all in proportion to the greatnefs or 
fmallnefs of the balances which were refpe&ively 
due from them. Payments have in general been 
more regular from the northern than from the 
tobacco colonies, though the former have gene- 
rally paid a pretty large balance in money, while 
the latter have either paid no balance, or a much 

fmaller 



THE WEALTH OF NATIONS. 
fmaller one. The difficulty of getting payment 
from our different fugar colonies has been greater 
or lefs in proportion, not fo much to the extent 
,of the balances refpeftively due from them, as to 
the quantity of uncultivated land which they 
contained j that is, to the greater or fmaller 
temptation which the planters have been under 
of over-trading, or of undertaking the fettlement 
and plantation of greater quantities of wade 
land than fuited the extent of their capitals. 
The returns from the great ifland of Jamaica, 
where there is flill much uncultivated land, have, 
upon this account, been in general more irregu- 
lar and uncertain, than thofe from the fmaller 
iflands of Barbadoes, Antigua, and St. Chrif- 
tophers, which have for thefe many years been 
completely cultivated, and have, upon that ac- 
count, afforded lefs field for the fpeculations of 
the planter. The new acquifitions of Grenada, 
Tobago, St. Vincents, and Dominica, have 
opened a new field for fpeculations of this kind ; 
and the returns from thofe iflands have of late 
been as irregular and uncertain as thofe from the 
great ifland of Jamaica. 

IT is not, therefore, the poverty of the colo- 
nies which occafions, in the greater part of them, 
the prefent fcarcity of gold and filver money. 
Their great demand for a&ive and productive 
ftock makes it convenient for them to have as 
little dead ftock as pofliblej and difpofes them 
upon that account to content ' themfelves with a 
cheaper though lefs commodious inftrument of 
commerce than gold and filver. They are 

thereby 





THE NATURE AND CAUSES OF 

thereby enabled to convert the value of that gold 
and filver into the inftruments of trade, into the 
materials of clothing, into houfehold furniture, 
and into the iron work neceflary for building and 
extending their fettlements and plantations. In 
thofe branches of bufinefs which cannot be 
tranfa&ed without gold arid filver money, it ap- 
pears, that they can always find the neceflary 
quantity of thofe metals ; and if they frequently 
do not find it, their failure is generally the effect, 
not of tlieir neceflary poverty, but of their un- 
neceffary and exceflive enterprife. It is not 
becaufe they^are poor that their payments are 
irregular and uncertain ; but becaufe they are 
too eager to become exceffively rich. Though 
all that part of the produce of the colony taxes, 
which was over and above what was neceflary 
for defraying the expence of their own civil and 
military eftablifhments, were to be remitted to 
Great Britain in gold and filver, the colonies 
have abundantly wherewithal to purchafe the 
requifite quantity of thofe metals. They would 
in this cafe be obliged, indeed, to exchange a 
part of their furplus produce, with which they 
now purchafe active and productive flock, for 
dead fjtock. In tranfacting . their domeftic buft- 
nefs they would be obliged to employ a coflly 
inflead of a cheap inftrument of commerce ; and 
the expence of purchafing this coftly inftrument 
might damp fomewhat the vivacity and ardour 
of their exceflive enterprife in the improvement 
of land. It might not, however, be neceffary to 
remit any part of the American revenue in gold 

and 



THE WEALTH OF NATIONS. 

and filver. It might be remitted in bills drawn c 
upon and accepted by particular merchants or 
companies in Great Britain, to whom a part 
of the furplus produce of America had ' been 
- conilgned, who would pay into the treafury the 
American revenue in money, after having them- 
felves received the value of it in goods ; and the 
whole bufmefs might frequently be traniacted with- 
out expjrtinga fmgle ounce of gold or filver from 
America, 

IT is not contrary to juftice that both Ireland 
and America mould contribute towards the dif- 
charge of the public debt of Great Britain. 
That debt has been contracted in fupport of the 
government eflablifhed by the Revolution, a 
government to which the proteftants of Ireland 
owe, not only the whole authority which they at 
prefent enjoy in their own country, but every 
fecurity which they poflefs for their liberty, their 
property, and their religion ; a government to 
which ' feveral of the colonies of America owe 
their prefent charters, and confeq\iently their 
prefent conftitution ; and to which all the colo- 
nies of America owe the liberty, fecurity, and 
property which they have ever fince enjoyed. 
That public debt has been contracted in the 
defence, not of Great Britain alone, but of all 
the different provinces of the empire ; the im- 
menfe debt contracted in the late war in parti- 
cular, and a great part of that contracted in the 
war before, were both properly contracted in de- 
fence of America. 

BY 




4 6o THE NATURE AND CAUSES OF 

BOOK BY a union with Great Britain, Ireland would 
gain, befides the freedom of trade, other advan- 
tages much more important, and which would 
much more than compenfate any increafe of 
taxes that might accompany that union. By the 
union with England, the middling and inferior 
ranks of people in Scotland gained a complete 
deliverance from the power of an ariftocracy 
which had always before opprefled them. By an 
union with Great Britain, the greater part of the 
people of all ranks in Ireland would gain an 
equally complete deliverance from a much more 
oppreflive ariftocracy ; an ariftocracy not fbund- 
cd, like that of Scotland, in the natural and 
refpe&able diftin&ions of birth and fortune ; but 
in the moft odious of all diftindions, thofe of 
religious and political prejudices ; diftin&ions 
which, more than any other, animate both the 
infolence of the oppreflbrs and the hatred and 
indignation of the opprefled, and which com- 
monly render the inhabitants of the fame coun- 
try more hoftile to one another than thofc of dif- 
ferent countries ever are. Without a union with 
Great Britain, the inhabitants of Ireland are not 
likely for many ages to confider themfelves as one 
people. 

No oppreflive ariftocracy has ever prevailed in 
the colonies. Even they, however, would, in 
point of happinefs and tranquillity, gain confider- 
ably by a union with Great Britain. It would, 
at leaft, deliver them from thofe rancorous and 
virulent factions which are infeparable from 

final! 



THE WEALTH OF NATIONS. 46* 

fmall democracies, and which have fo frequently CHAP, 
divided the affections of their people, and dif- 
turbed the 4 tranquillity of their governments, in 
their form fo nearly democratical. In the cafe 
of a total feparation from Great Britain, which, 
unlefs prevented by a union of this kind, feems 
very likely to take place^ thofe factions would 
be ten times more virulent than ever. Before 
the commencement of the prefent difturbances 
the coercive power of the mother-country had 
always been able to reflrain thofe factions from 
breaking out into any thing worfe than grofs 
brutality and infult. If that coercive power 
were entirely taken away, they would probably 
foon break out into open violence and blood- 
flied. In all great countries which are united 
under one uniform government, the fpirit of 
party commonly prevails lefs in the remote pro- 
vinces than in the centre of the empire. The 
diftance of thofe provinces from the capital, 
from the principal feat of the great fcr amble of 
faction and ambition, makes them enter lefs into 
the views of any of the contending parties, and 
renders them more indifferent and impartial 
fpectators of the conduct of all. The fpirit of 
party prevails lefs in Scotland than in England. 
In the cafe of a union it would probably pre- 
vail lefs in Ireland than in Scotland, and the 
polonies would probably foon enjoy a degree of 
concord and unanimity at prefent unknown in 
any part of the Britifti empire. Both Ireland 
and the colonies, indeed, would be fubjected to 
heavier taxes than any which they at prefent 
9 pay. 



^2 THE NATURE AND CAUSES OF 

BOOK pay. In confequence, however, of a diligent 
and faithful application of the public revenue 
towards the difcharge of the national debt, the 
greater part of thofe taxes might not be of long 
continuance, and the public revenue oP Great 
Britain might foon be reduced to what was ne- 
ceflary for maintaining a moderate peace ellablifh- 
ment. 

THE territorial acquifitions of the Eaft India 
company, the undoubted right of the crown, 
that is, of the ftate and pepple of Great Britain, 
might be rendered another fource of revenue 
more abundant, perhaps, than all thofe already 
mentioned. Thofe countries are reprefented as 
more fertile, more extenfive 5 and -in proportion 
to their extent, much richer and more populous 
than Great Britain. In order to draw a great 
revenue from them, it would not probably be 
neceflary to introduce any new fyflem of taxa- 
tion into countries which are already fufficiently 
and more than fufficiently taxed. It might, per- 
haps, be more proper to lighten than to aggra- 
vate the burden of thofe unfortunate countries, 
and to endeavour to draw a revenue from them, 
not by impofing new taxes, but by preventing the 
embezzlement and mifapplication of the greater 
part of thofe which they already pay* 

IF it fliould be found impracticable for Great 
Britain to draw any confiderable augmentation of 
revenue from any of the refources above men- 
tioned ; the only refource which can remain to 
her is a diminution of her expence. In the mode 
of collecting, and in that pf expending the pub- 
5 lie 



THE WEALTH OF NATIONS. 463 

lie revenue ; though in both there may be fllll CHAP. 
room for improvement , Great Britain feems to ^,^1^ 
be at leaft as ceconomical as any of her neigh- 
bours. The military eftablifhment which (he 
maintains for her own defence in time of peace, 
is more moderate than that of any European 
flate which can pretend to rival her either in 
wealth or in power. None of thofe articles, 
therefore, feein to admit of any confiderabie re- 
duction of expence. The expence of the peace 
eftablifhment of the colonies wa?, before the 
commencement of the prefent difturbances, very 
confiderabie, and Is an expence which may, and, 
if no revenue can be drawn from them, ought * 
certainly to be faved altogether. This conftant 
expence in time of peace, though very great, is 
infignificant in comparifon with what the defence 
of the colonies has coft us in time of war. The 
lafl war, which was undertaken altogether on 
account of the colonies, cofl Great Britain, it 
has already been obferved, upwards of ninety 
millions. The Spanifh war of 1739 was prin- 
cipally undertaken on their account ; in which, 
and in the French war that was the confequence 
of it, Great Britain fpent upwards of forty mil- 
lions, a great part of which ought juftly to be 
charged to the colonies. In thofe two wars the 
colonies coft Great Britain much more than 
double the linn which the national debt amounted 
to before the commencement of the firft of them. 
Had it not been for thofe wars that debt might, 
and probably would by this time, have been 
completely paid j and had it riot been for the 

colonies, 



464 THE NATURE AND CAUSES OF 

BOOK colonies, the former of thofe wars might not, 
and the latter certainly would not have been un- 
dertaken. It was becaufe the colonies were fup- 
pofed to be provinces of the Britifh empire, that 
this expence was laid out upon them. But coun* 
tries which contribute neither revenue nor mili- 
tary force towards the fupport of the empire, can- 
not be confidered as provinces. They may per- 
haps be confidered as appendages, as ,a fort of 
fplendid and fhowy equipage of the empire. 
But if the empire can no longer fupport the ex- 
pence of keeping up this equipage, it .ought cer- 
tainly to lay it down ; and if it cannot raife its 
revenue in proportion to its expence, it ought, 
at leaft, to accommodate its expence to its re- 
venue. If the colonies,, notwithftanding their 
refufal to fubmit to Britifh taxes, are ftill to 
be confidered as provinces of the Britifh empire, 
their defence in fome future war may coft Great 
Britain as great an expence as it ever has done in 
any former war. The rulers of Great Britain 
have for more than a century paft, amufed the 
people with the imagination that they pofiefled a 
great empire on the weft fide of the Atlantic* 
This empire, however, has hitherto exilted in 
imagination only. It has hitherto been, not an 
empire, but the project of an empire ; not a 
gold mine, but the project of 'a gold mine; a 
project which has coft, which continues to cofl, 
and which, if purfued in the fame way as it has 
been hitherto, is likely to coft, immenfe expence, 
without being likely to bring any profit ; for the 
effects of the monopoly of the colony trade, it 

has 



THE WEALTH OF NATIONS. 465 

has been (hewn, are, to the great body of the CHAP. 
people, mere lois inftead of profit. Iris furely 
now time that our rulers fhould either realize 
this golden dream, in which they have been 
indulging themfelves, perhaps, as well as the 
people i or, that they fhoukl awake from it 
themfelves, and endeavour to awaken the people. 
If the project cannot be completed, it ought to 
be given up. If any of the provinces of the Britifh 
empire cannot be made to contribuce towards the 
fupport of the whole empire, it is furely time 
that Great Britain fhould free herfelf from the 
expence of defending thofe provinces in time of 
war, and of fupporting any part of their civil or 
military eftablifhments in time of peace, and en- 
deavour to accommodate her future views and 
defigns to the real mediocrity of her circum- 
ftances. 



VOL. in. 



H H INDEX. 



INDEX. 



N. B. The Roman Numerals refer to the Volume> 
and the Figures to the Page. 



ABSENTEE tax, the propriety of, confidered, with reference 
to Ireland, iii. 373. 

Accounts tf money, in modern Europe, all kept, and the value of 
goods computed, in filver, i. 58. 

^7orj, public, paid for the contempt attending their profefBon, i. 163. 

Africa, caufe affigned for (he barbarous ftate of the interior parts of 
that continent, i. 32. 

African company, eftablifhment and constitution of, iii. 117. Re- 
ceive an annual allowance from parliament for forts and garrifons, 
lio. The company not under fufficient controul, Hid. Hiftory 
of the Royal African company, 124. Decline of, 125. Rife of 
the prefent company, 126. 

dge, the foundation of rank afid precedency in rude as well as civi- 
lized focieties, iii. 75. 

dggregats fund, in the Britifh finances, explained, iii. 408. 

Agio of the bank of Amfterdam explained, ii. 218. Of the bank of 
Hamburgh, 220. The agio at Amfterdam, how kept at a medium 
rate, 231. 

Agriculture t the labour of, does not admit of fuch fubdivifions 4s ma- 
nufactures, i. 9. This impoffibility of feparation, prevents agri- 
culture from improving equally with manufactures, 10. Natural 
jftateof, in a new colony, 140. Requires more knowledge and 
experience than moft mechanical profeflions, and yet is carried on 
wichout any reftriclions, 196. The terms of rent how adjufted 
between landlord and tenant, 223. Is extended by good roads and 
navigable canals, 228. Under whaf^ii cum (lances paftureland is 
more valuable than arable, 232. Gardening not a very gainful 
employment, 237. Vines the moft profitable article of culture, 239, 
Eftimates of profit from projects, very fallacious, 240. Cattle and 
tilUge mutually improve each other, 344. Remarks on that of 

H H 2 Scotland, 



I N D E X.- 
Scotland, 346. Remarks on that of North America, 349. Poultry 
a profitable article in huibandry, 352. Hogs, 354. Dairy, 355. 
Evidences of land being completely improved, 358. Theexten- 
fion of cultivation, as it raifes the price of animal food, rednces 
that of vegetables, 382. 

Agriculture^ by whom and how practifed under feudal government, 
ii. 8. Its operations not fo much intended to increafe, as to direct, 
the fertility.of nature, 52. Has been the-caufe of the profperity of 
the Britifti colonies in America, 57. The profits of, exaggerated 
by projectors, 71. On equal terms, is naturally preferred to 
trade, 76. Artificers necefTary to the carrying it on, 77. Was 
not attended toby the Northern deftroyers of theRoman empire, 
81. The ancient policy of Europe unfavourable to, 98. Was 
promoted by the commerce and manufactures of towns, 1 30. The 
wealth arifingfrom, more folid and durable, than that which pro- 
ceeds from commerce, 137. Is not encouraged by the bounty on 
the exportation of corn, 267. Why the proper bufinefs of new 
companies, 432. 

* The prefent agricultural fyftcm of politfcal eeconoftiy 

adopted in France, defcribed, iii. 4. Is difcouraged by reftric- 
tions and prohibitions in trade, 17. Is favoured beyond manu- 
factures,,^ China, 30. And in Indoftan, 33. Does not require 
fo extenftve a market as manufactures, 35. To check manufac- 
turesjJn order to promote agriculture, falfe policy, 41. Landlords 
ought to be encouraged to cultivate part of their own land, 266, 
Alcavala, the tax in Spain fo called, explained and confidered, 
iii. 381. The ruin of the Spaniih manufactures attributed to this 
tax, 382. ^ 
Akboufes, the number of, not the efficient cauie of drunkennefs, ii. 

50. 241. 

Allodial rights, miftaken for feudal rights, ii. 122. The introduction- 
of the feudal law tended to moderate the authority of the allodial 
lords, 124. 

Ambaffadors, the firft motive of their appointment, iii. 108. 
4merica y why labour is dearer in North America than in England, 
i. 105. Great increafe of population there, 106. Common rate of 
intereil there, 140. Is a new market for the produce of its own 
filver mines, 316. The firft accounts of the two empires of Peru 
and Mexico, greatly exaggerated, 317. Improving ftate of the 
Spanifti colonies, 318. Account of the paper currency of the 
Britifh colonies, 493. 

.. , Caufe of the rapid profperity of the Britilh colonies there,, 
ij. 57. Why manufactures for diftant fale have never been efta- 
bliihed there, 78. Its fpeedy improvement owing to afliftance from 
foreign capitals, 80. 'Jhe purchafe and improvement of unculti- 
vated land, the moll profitable employment of capitals, 132. Com- 
mercial alterations produced by the difcovery of, 169. But two 
civilized nations found on the whole continent, 170. The wealth 

of 



I N D E X. 

of the North American colonies increafed, though thebalanceof 
trade continued againft them, 251, Madeira wine, how introduced 
there, 257. Hiftorical review of the European fettiements in, 348. 
Of Spain, 362. Of Holland, 367. Of France, 368. OfBrU 
tain, 570. Ecclefiaftical government in the feveral European co- 
lonies, 374. Fifli a principal article of trade from North America 
to Spain, Portugal, and the Mediterranean, 380. Naval flores to 
Britain, 382. Little credit due to the policy of Europe from the 
fuccefs of the colonies, 397. Thedifcovery and colonization of, 
how far advantageous to Europe, 400, And to America, 458. 
The colonies in, governed by a {pirn of monopoly, 467, The 
intereft of the confumer in Britain facrificed to that of the pro- 
ducer, by the fyftem of colonisation, 517. 

America, plan for extending the Britiih fyilem of taxation over all 
the provinces of, in. 442. The queftion how the Americans could 
pay taxes without fpecie, confidered, 452. Ought in juftice to 
contribute to difcharge the public debt of Great Britain, 459. 
Expediency of their union with Britain, 460. The Britifh empire 
there, a mere projecl, 4^4. 

Amfierdam^ agio of the bank of, explained, ii. 218. Occafion of its 
eftablifhment, 220. Advantages attending payments there, 221. 
Rate demanded for keeping money there, 223. Prices at which 
bullion and coin are received, 225, Note. This bank, the great 
warehoufe of Europe for bullion, 228. Demands upon, how 
made and anfwered, 229. The agio of, how kept at a'medium 
rate, 23 I. The treafure of, whether all preferved in its repofito- 
ries, MM. The amount of its treafure only to be conjedured, 
233. Fees paid to the bank for tran fading bufinef?, ibid. 

Annuities for terms of years, and for lives, in the Britifh finances, 
hiltorica! account of, iii. 41 1. 

Apothecaries, the profit on their drugs unjuftly ftigmatized as exotbi- 
tant, i. 171. 

Apprenticeship, the nature ahd intention of this bond fervitude ex- 
plained,!. 155. The limitations impofed on various trades, as to 
the number of apprentices, 184. The ftatute of apprenticeship 
in England, 186. Apprentkefhips in France and Scotland, 187. 
General remarks on the tendency and operation of long appren- 
tice fhips, '188. 

The ftatute of, ought to be repealed, ii. 205. 
Arabs, their manner of fupporting war, iii. 45. 

Army, three different ways by which a nation, may maintain one in 
a diftant country, ii. 157. 

Standing, diftinclion between and a militia, iii. 56. Hi/lo- 
rical review of, 61. The Macedonian army, ibid. Carthaginian 
army, 62. Roman army, 63. Is alone able to perpetuate the 
civilization of a country, 68. Is the fpeedieft engine for civilizing 
a barbarous country, ibid. Under what circumftances dangerous 
to, and under what favourable to, liberty, 69. 

H 3 drtifccrt, 



INDEX, 

Artificers, prohibited by law from going to foreign countries, ii. 513, 
Refiding abroad, and not returning on notice, expofed to out- 
lawry, 514. See Manufactures. 

Ajdrulal, his army greatly improved by difcipline, iii. 62. How de- 
feated, 63. 

A/embly> houfes of, in theBritifh colonies, the constitutional freedom 
of, fhewn, ii. 391. 

Ajfiento contract, iii. 129, 

AJJixt of bread and ale, remarks on that flatute, i. 279. 286, 

Auguftus, emperor, emancipates the ilaves of Vedius Poilio, for his 
cruelty, ii. 396. 

B 

Balance of annual produce and confumption explained, ii. 250. May 
be in favour of a nation, when the balance of trade is againil it, 
251. 

Balance of trade, no certain criterion to determine on which fide it 
turns between two countries, ii. 212. The current doctrine of, on 
which moft regulations of trade are founded, abfurd, 235. If even, 
by the exchange of their native commodities, both fides may be 
gainers, 236. How the balance would Hand, if native com modi- 
ties on one fide, were paid with foreign commodities on the other, 
237. How the balance {lands when commodities are purchafed with 
gold and filver, 239. The ruin of countries often predicted from 
the doctrine of an unfavourable balance of trade, 249, 
Banks, great increafe of trade in Scotland, ftnce the eftablilhment of 
them in the principal towns, i. 442. Their ufual courfe of bufi- 
nefs, 444. Confequences of their ifTuing too much paper, 449. 
Neceflary caution for fome time obferved by them with regard to 
giving credit to their cuilomers, 456. Limits of the advances they 
may prudently make to traders, 460. How injured by the practice 
of drawing and redrawing bills, 467. Hiftory of the Ayr ban^, 
471. Hiftory of the bank of England, 479. The nature and 
public ad vantage of banks confidered, 483. Bankers might carry 
en their bufinefs with lefs paper, 488. Effects of the optional 
claufes in the Scots notes, 492. 

Origin of their eftabliihment, ii. 220. Bank money ex 
plained, 221. Of England, the conduct of, in regard to the 
coinag^ 337. 

,,_ Juint (lock companies wjiy well adapted to the trade of 

banking, iii. 146. 148. A doubtful queftion whether the govern- 
ment of Great Britain is equal to the management of the bank to 
profit, 243. 

Bankers, the credit of their notes how eflablifhed, i. 434. The na- 
ture of the banking bufinefs explained, 435. 444, 
The multiplication and competition of bankers pndef 

proper regulation, of fervice to public, credit, 498, 



I N D. E X. 

Baretts,Mr. his account of the quantity of Portugal gold fent 

weekly to England, if. 328. 

arorts, feudal, their power contracted, by the grant of municipal 
privileges, ii. 105. Their extenfive authority, 121. How they 
loft their authority over their va/Tals, 125. And the power to 
difturb their country, 129. 

Barter, the exchange of one commodity for another, the pro- 
penfity to, of extenfive operation, and peculiar to man, i. 20. 
Is not fufficient to carry on the mutual intercourfe of mankind, 33. 
See Commerce. 

Batavia, caufes of the profperity of the Dutch fettlement there, 
ii. 47$. 

Beaver (kins, review of the policy ufed in the trade for, ii. 511. 

Be*/* cheaper now in London than in the reign of James I. i. 235. 
Compared with thepr c *s of wheat at the correfponding times, 236. 

Benefices, ecclefiaftical, the tenure of, why rendered fecure, iii. 210. 
The power of collating to, how taken from the Pope, in England 
and France, 220. General equality of, among the Prefbytertans, 
229. Good effects of this equality, 230. 

Bengal^ to what circumftances its early improvement in agriculture 
and manufaolures was owing, i. 31. Prefent miferable Itateof the 
country, no. Remarks on the high rates of intereft there, 143. 

. Oppreffive conduct of the Englifh there to fait their trade ia 

opium, ii. 477. 

. . Why more remarkable for the exportation of manufactures 

than of grain, iii. 35. 

Berne, brief hiitory of the republic of, ii. 108. 

_ Eftabliftiinent of the reformation there, iii. 223. Application 
of the revenue of the Catholic clergy, 235. Derives a revenue 
from the intereft of its treafure, 245. 

Bills of Exchange t punctuality in the payment of, how fecured, 
i. 464. The pernicious practice of drawing and redrawing ex- 
plained, 465. The arts made ufe of to difguife this mutual traffic 
in bills, 469. 

Rirtto, fuperiority of, how it confers refpect and authority, iii. 77. 

Bifoopt the ancient mode of electing them, and how altered, iii. 2 1 2. 
220. 

Body, natural and political, analogy between, iii. 20. 

Bohemia^ account of the tax thereon the induftry of artificers, iii. 225. 

Bounty on the exportation of corn, the tendency of this meafure exa- 
mined, i. 303. 

Bounties , why given in commerce, ii. 174. On exportation, the 
policy of granting them con fidered, 261. On the exportation 
of corn, 263. This bounty impofes two taxes on the people, 
266. Evil tendency of this bounty, 274. The bounty only bene- 
ficial to the exporter and importer, 276. Motives of the country 
gentlemen in granting the bounty, ibid. A trade which requires 
a bounty, necefiarily a lofing trade, 279. Tonnage bounties to 
jhe fineries considered, 281 . Account of the white-herring filh- 
n H 4 cry, 



INDEX. 
I 

ery, 287. Remarks on other bounties, 288. A review of the 
principles on which they are generally granted, 489. Thofe 
granted on American produce founded on miftaken policy, 493. 
How they afFeft the confumer, 516. 
BourJeaux* why a town of great trade, ii. 10. 
Brazil, grew to be a powerful colony under neglecl, ii, 364. The 
Dutch invaders expelled by thePortugueze colonifts, 36;;. Com- 
pated number of inhabitants there, ibid. The trade of the prin- 
cipal provinces opprefled by the Portugueze, 376. 
"Bread, its relative value with butcher's- meat compared, i. 230.235, 
Brewery, reafons for transferring the taxes on, to the malt, iii. 363. 
Bridges, how to be creeled and maintained, iii. 94. 
Britain, Great, evidences trtet labour is fufliciently paid for there, 
i. in. The price of provifions nearly the fame in jnoft places, 112. 
Great variations in the price of labour, 113. Vegetables imported 
from Flanders in the laft century, 118. Hiflorical. account; of the 
alterations intereft of money has undergone, 135. Double intereft 
deemed a reafonable mercantile profit, 148. 

._ _ In what refpecls the carrying trade is advantageous 

to, ii.66. Appears to enjoy more of the carrying trade of Europe 
than it really has, 69. Is the only country of Europe in which the 
obligation of purveyance is aboliflied, 96. Its funds for thefupport 
of foreign wars inquired into, 1 59. Why never likely to be much 
affected by the free importation of Irifh cattle, 187. Nor fait pro- 
viiions,i89. Could be little affecled by the importation of foreign 
corn, ibid. The policy of the commercial reftraints on the trade 
with France examined, 21 1. The trade with France might be 
more advantageous to each country than that with any other,247. 
Why one of the richeft countries in Europe, while Spain aud Portu- 
gal are among the pooreft, 320. Re view of her American colonies, 
370. The trade of her colonies, how regulated, 378. Diftindlion 
between enumerated and non-enumerated commodities, explain- 
ed, ibid. Reftrains manufactures in America, 385. Indulgences 
granted to the colonies, 388. Conftitutionsl freedom of her colo- 
ny government, 391. The fugar Colonies of, worfe governed than 
thole of Franc.e, 394. Difadvantagesrefuhing from retaining the 
exclufive trade of tobacco with Maryland and Virginia, 407. The 
navigation at has increafed the colony trade, at the expence of 
many other branches of foreign trade, 41-1. The advantage of the 
colony trade cftitnated, 417. A gradual relaxatkftftjf th exclu- 
five trade, recommended, 426. Events which have concurred to 
prevent the ill effects of the lofs of the colony trade, 427, The na- 
tural good effVfts of the colony trade, more than counterbalance 
the bad efrV&s of the monopoly, 431. To maintain a monopoly, 
the principal end of the dominion a [Turned over the coiooiea, 44 r . 
Has derived nothing but lofs from this dominion, 443. ls : perhaps 
theoniy iiate which has only increafed its expences by extending its 
empire, 45 1 . The conltitution of, would have been completed by 
fdmiuing of American reprefentation, 456. Review of the admi- 

niilrauon 



INDEX. 

niftration of the Eaft India Company, 480. The intereft of the 
confumer facrificed to that of the producer in railing an empire in 
America, 517. 

Britain, Great, the annual revenue of, compared with its annual 
rents and intereft of capital rtock, iii. 250. The land tax of, con- 
fidered, 259. Tythes, 274. Window tax, 290. Stamp duties, 
31*6.321. Poll taxes in the reign of William ill. 328. The uni- 
formity of taxation in,, favourable to internal trade, 382. The 
fyftem of taxation in, compared with that io France,^!. Account 
of the unfunded debt of, 403. Funded debt, 404. Aggregate 
and general funds, 408. Sinkingfunk, 410. Annuities for terms 
of years and for lives, 41 1. Perpetual annuities the beft tranf- 
ferrable ftock, 415. The reduction of the public debts during 
peace, bears no proportion to their accumulation during war, 420. 
The trade with the tobacco colonies, how carried on, without the 
intervention of fpecie, 454. The trade with the fugar colonies 
explained, 456. Ireland and America ought in juftice to contri- 
bute toward the difcharge of her public debts, 459. How the 
territorial acquifitions of the Eaft India company might be rendered 
a fource of revenue, 462. If no fuch affittance can be obtained, 
her only refource pointed out, ibid. 

Bullion, the money of the great mercantile republic, ii. 162. See 
Gold and Silver. 

urgbs, free, the origin of, ii. 102. To what circum (lances they 
owed their corporate jurifdictions, 104. Why admitted to fend re- 
prelentatives to parliament, 138. Are allowed to protect refugee* 
from the country, 109. 

$urn, Dr. his observations on the laws relating to the fsttlements of 
the poor, i. 213. 217. 

Butcher's -meat, no where a neceflary of life, iii. 341. 



Calvimftt, origin of that feet, iii. 225. Their principles of church 
government, 227. N 

Cameron, Mr. of Lochiel, exercifed, within thirty years fince, a cri- 
minal jurisdiction over his own tenant?, ii. 1 23. 

Canada, the French colony there, long under the government of an 
exclufive company, ii. 368. Bu t improved Speedily after the diflb- 
lution of the company, 369. 

Canals, navigable, the advantages of, i. 229. How to be made and 
maintained, iii. 94. That of Languedoc, the Support of, how 
Secured, 97. May be fuccefsfully managed by joint ftock com- 
panies, 147. 

Canilllon, Mr. remarks on his account of the earnings of thelabour- 
irg poor, 102. 

CW/* of Good Hope, caufesof the profperity of theDutch Settlement 
there, ii. 474. 

Capital^ 



INDEX. 

l, in trade, explained, an dhow em ployed, 1.411. Diftinguiihed 
into circulating and fixed capitals, 412. Characleriftic of fixed 
capitals, 416. The feveral kinds of fixed capitals fpecified, ibid. 
Charafteriftic of circulating capitals, and the fevera] kinds of, 417. 
Fixed capitals fupported by thofe which are circulating, 418. Cir- 
culating capitalshowfupported, 419. Intention of a fixed capital, 
425. The expence ofmaintainingthefixedandcirculatingcapitals 
iliuftrated, 427. Money, as an article of circulating capital, con- 
fidered,428. Money, no meafure of capital, 433. What quantity 
of induftry any capital can employ, 440. Capitals, how far they 
may be extended by paper credit, 460. 

Muft alwaysbe replaced with profit by the annual produce of 

land and labour, ii. 5. The proportion between capital and re- 
venue, regulates the proportion between induftry andidlenefs, 12. 
Kowit is increafedordiminifried, 13. 'National evidences of the 
increafe of, 23. In what inftances private expences contribute to 
enlarge the national capital, 28. The increafe of, reduces profits 
by competition, 38. The different ways of employing a capital, 
46. How replaced to the different claffes of traders, 50. That 
(employed in agriculturepuisinto motion a greater quantity ofpro- 
dudive labour, than any equal capital employed in manufactures, 
53. That of a manufacturer ihould refide within the country, 55. 
The operation of capitals employed in agriculture, manufactures, 
and foreign trade, compared, 56. The profperity of a country de- 
peridsonthedueproportionofitscapitalappliedtothefethreegrand 
cbje&s, 59. Differentreturns of capitalsemployedin foreign trade, 
63, Is raiher employed on agriculture than in trade and manu- 
factures, on equal terms, 76. Is rather employed in manufactures 
than in foreign trau'e, 79. The natural progrefs of the employment 
of, 80. Acquired by trade, is very precarious until realized by the 
cultivation and improvement of land, 136. The employment of, 
in the different fpecies of trade, how determined, 178. 

Capitation taxes, the nature of, confidered, Hi. 327. In England, 
328. In France, 329. 

Carriage, land and water, compared, i. 28. Water carriage con- 
tributes to improve arts and induftry, in all countries where it can 
be ufed, 29. 228. 323. 

Land, how facilitated and reduced in price, by public 

works, iii. 93. 

Carrying trade, the nature and operation of, examined, ii. 64. Is 
thefymptom, but not the caufe, of national wealth, and hence 
points out the two richeft countries in Europe, 69. Trades may 
appear to be carrying trades, which are not fo, ibid. The difad- 
vantages of, to individuals, 178. The Dutch, how excluded from 
being the carriers to Great Britain, 193. Drawbacks of duties 
originally granted for the encouragement of, 258. 

Carthaginian army, its fuperiority over the Roman army, accounted 
for, iii. 62. 

Cattk and corn, their value compared, in the different ftages of agri- 
qjl$ure, i. 230. Theprice of, reduced by artificial grafles, 234. 



INDEX. 

To whatheight the price of cattle may rife in an im proving country. 
344. The railing a ftock of, neceflary for the fupply of manure to 
farm?, 345. Cattle muft bear a good price to bu well fed, 346. 
The price of, rifes in Scotland in confequence of the union wiiSSi 
England, 348. Great multiplication of European cattle in Ame- 
rica, 349. Are killed in fome countries, merely for the fake of the 
hides and tallow, 361. The market for thefe articles more exteti- 
five than for the carcafe, 362. This market fometimes brought 
nearer home by the eftablfmment of manufactures, ibid. How the 
extenfion of cultivation raifes,the price of animal food, 3^2. Is 
perhaps the only commodity more expensive to tranfport by fea than 
by land, ii. 187. Great Britain never likely to be much aftedcd 
by the free importation of frifh cattle, ibid. 

Certificates^ parrfti, the laws relating to, with obfervations on them, 
i. 216. 

Child, Sir Jofiah, his obfervation on trading companies, iii. \ 16. 

Children, riches unfavourable to the production, and extreme poverty 
to the raiiing, of them, i. 120. The mortality flM greater among 
thofe maintained by charity, 121. 

China> to what the^early improvement in arts and induftry there was 
owing, i. 31. Concurrent teftimonies of the mifery of the lower 
ranks of the Chinefe, 108. Is not however a declining country. 
109. High rate of intereft of money there, 145. The price of 
labour there, lower than in the greater part of Europe, 32?, 
Great (late aflumed by the grandees, 323. Silver ihe molt pro- 
fitable article to fend thither, ibid. The proportional value of gold 
to filvcr, how rated there, 3 } i ." The value of gold and filver much 
higher there than in any part of Europe, 376. 

Agriculture favoured there, beyond manufactures, iii, 30, 

Foreign trade not favoured there, 31. Extenfion of the home- 
market, 32. Great attention paid to the roads there, 103. In 
what the principal revenue of the fovereign confifts, 276. The 
revenue of, partly raifed in kind, 278. 

Church, the richer the church the poorer the ftate, iii. 235. Amount 
of the revenue of the church of Scotland, 236. The revenue of 
the church heavier taxed in Pruflia, than lay proprietors, 271. The 
nature and effeft of tythes confidered, 274. 

Circulation t the dangerous praclice of raifing money by, explained, 
i. 465. In traffic, the two different branches of, confidered, 

dnfies, circumftances which contributed to their opulence, ii. no* 
Thofe of Italy the firll that rofe to confequence, in. The com- 
merce and manufactures of, have occafioned the improvement and 
cultivation of the country, 130. 

Clergy t a fupply of, provided for, by public and private foundation* 
for their education, i. 202. Curates worfe paid than many me- 
chanics, 203. 

f Of an eftabliftied religion, whyunfuccefsfulagainfttheteachers 

pf a nevy religion, iii. 193. Why they perfccute their ad verfaries, 

- '94- 



INDEX. 

194. The zeal of the inferior clergy of the church of Rome, how 
kept alive, 195"- Utility of ecclefiafticai rftabliftiments, 198. How 
connected with the civii magi^rute, IQQ, Unfafe for the civil ma- 
giltraie to differwith them, 207. Muft be martagtd without vio- 
lence, 210. Cf the church of Ro,me, one great army cantoned 
over Europe, 213. Their power fimilar to that, of the temporal 
barons, during ihe feudal monkifh ages, 214.. How the pow r of 
the Romifh clergy declined, 218. Evils attending allowing pa- 
rifhes to el eel their own roinifters, 2*7. 

Cloatbing, more plentiful tbao food, in uncultivated countries, i. 252. 

The materials for, the fuft articles rude nations have to offer, 25 3. 

Coat, mufl generally be cheaper than wood to gain the preference for 

fuel, i. 259. The price of, how reduced, 261. 
The exportation of, fubjeded to a duty-higher than the prime 
coft of, at the pit, ii. 5 I z. The cheapeft of all fuel, 338. The 
-tax on, abfurdly regulated, 339. 

Coal mine?, their different degrees of fertility, i. 258. When fertile, 

are fometime* unprofitable by fituation, 259. The proportion of 

rent generally paid for, 262. The machinery neceiTary to> ex- 

penfive, 413. 

Coal trade from Newcaftle to London, employs more Shipping than 

all the other carrying trade of England, ii. 66. 
Cochin China, remarks on the principal articles of cultivation there, 

i. 244. 

Coin, Itamped, the origin and peculiar advantages of, in commerce, 
i. 38. The different fpecies of, in different ages and countries, 39. 
Caufes of the alterations in the value of, 40, 47, 50. How the 
ftandard coin of different nations came to be of different metals, 
57. A reform in the Engiifh coinage fuggefted, 67. Silver, con- 
Sequences attending the debafement of, 304. Coinage of France 
and Britain, examined, 215. Why coin is privately melted down, 
323. The mint chiefly employed to keep up the quantity thns 
diminished, 334. A duty to pay the coinage would preferve money 
from being melted or counterfeited, 335. Standard of the gold 
coin in France, 336. How a feignorage on coin would operate, 
ibid. A tax upon coinage is advanced by every body, and finally 
paid by nobody, 340. A revenue loft, by government defraying 
the expence of coinage, ibid. Amount of the annual coinage be- 
fore the late reformation of the gold coin, 341. The law for the 
encouragement of, fouon prejvdice, 342. 

the denomination, as an expeHJeJho 

ficiiita: of public debts, iii. 434. Adulteration of, 439. 

Colbert, M, the policy of his commercial ..regulations difputed, ii, 

200. iii. 3. His character, iii. z. 

Colleges, caufe of the depreciation of their money rents inquired into, 
i. ci.. The endowments of, from whence they generally arife, 
iii. 150. Whether ihey have in general anfwered the purpofes of 
their inilituticn, 151. Thefe endowments have diminiuVd the ne- 
eefiity of application in ;he : teachers, 152, The privileges of gra- 
duates 



INDEX. 

duates by refidence, and charitable foundation of fcholarihips, in- 
jurious to collegiate education, 155. Discipline of, 157. 

Colliers and coal-heavers, their high earnings accounted for, i. 159. 

Colon iet, new, the natural profrefs of, i. 140. 

-. Modern, the commercial advantages derived from them, 

if. 175. Ancient, on what principles founded, 343. Ancient 
Grecian colonies not retained under fubjeclion to the parent iUtes, 
344. Diftinction between the Roman and Greek colonies, 346. 
Circumftances that led to the elbbliftiment of European colonies ia 
the Ealt Indies and America, 347. The Eaft Indies difcovered by 
Vafco de Gama, 348. The W?rt Indies difcovered by Columbus, 
349. Gold the object of the firit Spanifh enterprises there, 354* 
And of thofe of all dther European nations, 357. Caufes of the 
profperity of new colonies, 358. Ripii pr^grefs of the ancient 
Greek colonies, 360. The Roman colonies flow in improvement, 
361. The remotcnefs of America and the Weft Indies greatly in 
favour of the European colonies there, 362. Review of the Britifh 
American colocies, 370. Expence of the civil ellablifliinents in 
Britifh America, 373. Eccleii iftical government, 374. General 
view of the reitraints laid upon the trade of the European colonies, 
375, The trade of the Bntifh colonies, how regulated, 377. The 
different kinds of non-enumerated co-'nmodities fpecined, 378. 
Enumerated commodities, 3^2. Reftraints upon their manufactures, 
385. Indulgences granted them by Britain, 388. Were free i a 
every oiher refpecl except as to cheir foreign trade, 391. Little 
credit due to the policy of Europe from the fuccefs of the colonies, 
397. Throve by the diforder and injoliice of the European govern- 
ments, 398. Have contributed to augment the indullry of all the 
countries of Europe, 401. iixcluiive privileges of trade, a dead 
weight upon all tbefe exertions both in Europe apd America, 403. 
Have in genera) b^en a fourcc of expence inllead of revenue to 
their mother countries, 405. Have only benefited their mother 
countries by the exclufive trade carried on with them, 406. Gon- 
fc-quences of the navigation ad, 409. The advantage of the co- 
lony trade to Britain eilinrated, 417. A gradual relaxation of the 
exclusive commerce recommended, 426. Events which have pre- 
vented Britain from fenfibly feeling the lofs of the colony trade, 
427. The effects of the colony trade, and the monopoly of that 
trade, diftinguifhed, 429. To maintain a monopoly, the principal 
end of the dominion Great Britain sflumes over the colonies, 441 . 
^toiount of the ordinary peace cftablfcnent of, ibid. The two late 

iRrs Britain fuftained, colony wars, to fupporc a monopoly, 442. 
Two modes by which they mipht be taxed, 446. Their afiemblies 
not likely to tax them, ibid. Taxes by parliamentary requifirion, 
as lk:;e likely to be raifed, 448. Representatives of, might be 
admitted into the Britilh Parliament with good effect, 453. An- 
fwer to objections againft American reprefentation, 456. The in- 
tereft of the confumer in Britain, facrificed to thai of the producer, 
in raiflng an empire in America, 517, 

Columbus, 



1 N* D E X. 

CdkaatttSt the motive that Jed to his difco very of America, ii. J4& 
Why he gave the name of Indies to the iilands he difcovered, 349. 
His triumphal exhibition of their productions, 352^ 

Cdumella, his inftruftion for fencing a kitchen-garden, i. 238. Ad- 
viies the planting of vineyards, 2^9. 

Commerce, ihe different common ftandards or mediums made ufe of to 
facilitate the exchange of comir.oditiee , in the early ftages of* i. 34. 
Origin of money, 3$. Definition of the term 'value, 42. 

Treat-esof 1 , though advantageous to the merchants and ma- 
nufactures of the favoured country, neceiTarily difadvantageous to 
thcfe of the favouring country, ii. 324. Tranflation of the com* 
mercia! treaty between England and Portugal concluded in 1703, 
by Mr. Metbuen, 325. Reftraints laid up6n the European colonie* 
in America, 375. Theprefent fplendour of the mercantile fyftem, 
owing to thedilcovery and colonization of America, 459. Review 
erf the plan by which it propofcs to enrich a country, 485. The 
irntereli of the confumer constantly facrificed to that of the pro- 
ducer, 515. See Agriculture, Banks, Capital, Manufactures, Mer- 
chant, Money f StocA, Trade, &c. 

Ccnuncdities, the barter of,, inefficient for the mutual fupply of the 
wants of mankind, i. 33. Metals found to be the beft medinm to 
facilitate the exchange of, 35. Labour an invariable ftandard for 
the value of, 48. Real and nominal prices^of, dillinguiflied, 49, 
The component parts of the prices of, explained and illuflrated, 75. 
The natural, and market prices of, diftinguifhed, and how regu- 
lated, 82. The ordinary proportion between the value cf any two 
commodities, not neceffarily the fame as between the quantities of 
them commonly in the market, 3311 The price oftude produce <. 
how affected by the advance of weahh and impiovement, 340. 

* Foreign, are primarily purchaied with the produce of 

domeftic induilry, ii. 6l. When advantageoufly exported in a 
jude itate, even by a foreign capital, 79. The quantity of, in every 
country, naturally regulated by the demand, 148. Wealth in 
goods, and in money, compared, 153. Exportation of, to a 
proper market, always attended with more profit than that of gold 
and /ilver, 161. The natural advantages of countries in particular 
productions, fometimes not poffible to ftroggle againtt, 185. . 

Company, mercantile, incapable of confulting their true interefts 
when they become fovereigns, ii. 479. An exc'ufwe company, 
a public nuifance, 485. 

Trading, how firft formed, iii. 109. Regulated, and^joinc 

flock companies, diftinguifheci, ibid. no. Regulated com panics in 
Great Britain, fpecified, 1 1 1 . Are ufelefs, 1 1 3. The conlUnt view 
of fuch companies, 115. Forts and garrifons, why never main- 
tained by regulated companies, 116. The nature of joint Hock 
companies explained, 122. 143. A monopoly neceffary to enable 
a joint flock company to carry on a foreign trade, 144. What kind 
of joint flock companies need no exclufive privileges, 146. Joint 
fiock companies, why welladapted tethe trade of banking, *'/</. The 

trade 



INDEX. 

trade of infurance may be carried on foccefsfully by a (lock cfrrt- 
pany, 147. Alfo inland navigations, and the fapply of water to 
a great city, ibid. Ill fuccefs of joint ftock companies in oiher 
undertakings, 149. 

Competition, the effect of, in the purchafe of commodities, i. 84. 
Among the venders, 86, 133. 

Concordat, in France, its object, iii. 220. 

Congrefs, American, its ftrength owing to the important characters it 
confers on the members of it, ii. 454. 

Converjion price, in the payment of rents in Scotland, explained, 
i. 284. 

Copper, the ftandard meafure of value among the ancient Romans, 
i. 57. Is no legal tender in England, 59. 

Cor/, the large ll quadruped on the ifland of St. Domingo, defcribed, 
ii. 350. 

Corn, the raifing of, in different countries, not fubjeft to the fame de- 
gree of rivallhip as manufactures, i. 11. Is the bed ftandard for 
referved rents, 51. The price of, how regulated, 53. The price 
of, the bed ftandard for com paring the different values of particular 
commodities at different times and places, 56. The three com- 
ponent parts in the price of, 75. Is dearer in Scotland than in 
England, 1 14. Its value compared with that of butcher's-meat, in 
the different periods of agriculture, 230.} 236. Compared with 
filver, 277. Circumftances in a hiftorical view of the prices of 
corn, that have mi Tied writers in treating of the value of filver at 
different periods, 284. Is always a more accurate meafure of 
value, than any other commodity, 293. Why dearer in great 
towns than in the country, 297. Why dearer in fome rich com- 
mercial countries, as Holland and Genoa, 298. Rofe in its no- 
minal price on thedifcovery of the American mines, 300. And 
in confequence of the civil war under king Charles 1. 302. And 
in confequence of the bounty on the exportation of, jo;. Ten- 
dency of the bounty examined, 307. Chronological table of the 
prices of, 398. 

The leaft profitable article of growth Jn the Britifh Weft India* 

colonies, ii. 89. The reftraints formerly laid upon the trade of, 
unfavourable to the cultivation of land, 98. The free importation 
of, could little affect the farmers of Great Britain, 189. The po- 
licy of the bounty on the exportation of, examined, 263. The 
reduction in the prke of corn, not produced by the bounty, 
264. Tillage not encouraged by the bounty, 267. The money 
price of, regulates that of all other home-made commodities, 26$. 
Illuftration, 271. Ill effects of the bounty, 274. Motives of iht 
country gentlemen in granting the bounty, 276. The natural value 
of corn not to be altered by altering the money price, 27$. The 
four feveral branches of the corn trade fpecified, 291. The inland 
dealer, for his own intereft, will not raife the price of corn higher 
than, the fcarcity of the tea fan requires, ibid* Corn a commodity 

the 
ii 



INDEX; 

the leaH liable to be monopolized, 293. The inland dealers in corn 
too numerous and difperfed to form a general combination, 294. 
Dearths never artificial, but when government interferes impro- 
perly to prevent them, 295. The freedom of the corn trade, the 
beft fecurity againft a famine, 297. Old EngJifti ftatute to prohibit 
the corn trade, 298. Confequences of farmers being forced to 
become corn dealers, 300. The ufe of corn dealers to the farmers, 
205. The prohibitory ftatute againft the corn trade foftened, 306. 
But ftill under the influence of popular prejudices, 307. The 
average quantity of corn imported and exported, compared with 
the confumption and annual produce, 309. Tendency of a free 
importation of corn, 311. The home market the moft important 
one for corn, Hid. Dudes payable on the importation of grain, 
before 13 Geo. 111. 312, Note. The impropriety of the ftatute 
22 Car. If. for regulating the importation of wheat, confefTed by 
the fufpeniion of its execution, by temporary ftatuces, 313. The 
home market indirectly fupplied by the exportation of corn, ibid* 
How a liberal fyftem of free exportation and importation, among 
all nations, would operate, 3 16. The laws concerning corn, fimi- 
lar to thofe relating to religion, 318. The home market fupplied 
by the carrying trade, .ibid. The fyftem of laws connected with 
the eftablifhment of the bounty, undeserving of praife, 319. Re- 
marks on the ftatute 13 Geo. III. 321. 

Corf orations, tendency of the exclufive privileges of, on trade, i, 93. 
184. By what authority erected, 191. The advantages cor-' 
porations derive from the furrounding country, 191. Check the 
operations of competition, 198. Their internal regulations, com- 
binations againft the public, 200. Are injurious, even to the 
members of them, 201. The laws of, obftrud the free circulation 
of labour, from one employment to another, 211. 

. The orir of, ii. 103. Are exempted by their privileges 

from the power ! the feudal barons, 105. The Europeaa Eaft 
India companies difadvantageous to the eaftern commerce, 171. 
The exclusive privileges of corporations ought to be deiiroyed, 205. 

Cottagers, in Scotland, their iitaation defcribed, i. 179. Are cheap 
manufacturers of ilockings, 181. The diminution of, in England, 
confidered, 354. 

Coward, character of, iii. ic;o. 

Credit. See Paper money. 

Cruxades to the Holy Land, favourable to the revival of commerce, 
ii. in. 

Currency of ftstes, remarks on, ii. 219. 

Cuftoms, the motives and tendency of drawbacks from the duties 
of, ii. 252. The revenue of the cutfoms increafed by draw- 
backs, 259. 

Occafion of firft impcfing the duties of, iii. 109. Origin of 

thofe duties, 345. Three ancient branches of, 346. Drawbacks 
of, 348. Ar regulated according to the mercantile fyilem, 349. 

.Frauds 



INDEX. 

Frauds practifed to obtain drawbacks and bounties, 350. The 
duties of, in many inftances uncertain, 352. Improvement 
of, fuggeiled, 353. Computation of the expence of collecting 
them, 376. 



D 

Dairy, the bufmefs of, generally carried on as a fave-all, i. 355. 
Circumftances which impede or promote the attention to it, 356. 
Englifh and Scotch dairies, 357. 

Danube, the navigation of that river why of little ufe to the interior 
parts of the country from whence it flows, i. 32. 

Davenant, Dr. his objections to the transferring the duties on beer 
to the malt, confidered, iii. 367. 

Dearths, never caufed by combinations among the dealers in corn, 
but by fome general calamity, ii. 295. The free exercife of th 
corn trade the bed palliative againit the inconveniences of a 
dearth, 306. Corn dealers the bell friends to the people at fuch 
feafons, 308. 

Debts, public, the origin of, traced, iii. 397. Are accelerated by the 
expences attending war, 399. Account of the unfunded debt of 
Great Britain, 403. The funded debt, 404. Aggregate and 
general funds, 408. Sinking fund, 410. 418. Annuities for terms 
of. years, and for lives, 411. The reduction of, during peace* 
bears no proportion to its accumulation during war, 420. The 
plea of the intereft being no burden to the nation, confidered, 428. 
Are feldom fairly paid when accumulated to a certain degree, 
434. Might eafily be difcharged, by extending the Britifh fyttem, 
of taxation over ail the provinces of the empire, 441. Ireland 
and America ought to contrfoute to difcharge the public debts of 
Britain, 459. 

Decker, Sir Matthew, his obfervations on the accumulation of taxes, 
iii. 337. His propofal for transferring all taxes to the container, 
by annual payments, confidered, 342. 

Demand, though the increafe of, may at firft raife the price cf goods, 
it never fails to reduce it afterward, iii. 134. 

Denmark, account of the fettlements of, in the Weft Indies, ii. 367. 

Diamonds* the mines of, not always worth working for, i. 270. 

Difcipline, the great importance of, in war, iii. 59. In fiances, 
61, &c. 

Di<ver/ions, public, their political ufe, iii. 206. 

Domingo, St. miilaken by Columbus for a part of the Eaft Indies, ii. 
349. Its principal productions, 350. The natives foon dripped 
of all their gold, 353. Hiftorical view of the French colony 
there, 369. 

Doom/Jay book, the intention of that compilation, iii. 270* 

Dorians, ancient, where the colonies of, fettled, ii. 343^ 

Dramatic exhibitions, ihe political ufe of, iii, 206. 
VOL. in, ii 



INDEX. 

n commerce, ex plained, ii. 174. The motives to, an ^ 
tendency of, explained, ii. 252. On wines, currants, and wrought 
fiiks, 253. On tobacco and fugar, 254. On wines, particularly 
considered, 255. Were originally granted to encourage the car- 
rying trade, 258. The revenue of the cuftoms increafed by them, 
259. Drawbacks allowed in favour of the colonies, 389. 

Drugs, regulations of their importation and exportation, ii. 508. 

Brunkmnefs^ the motive to this vice inquired into, ii. 242. 

Dutch, their fettlements in America flow in improvement becaufe un- 
der the government of an exclufive company, ii. 367. Their Eaft 
India trade checked by monopoly, 469. Meafures taken by, to 
fecure the monopoly of the fpice trade, 476. See Holland. 



Eaft India, reprefentation of the miferable ftate of the provinces of, 
under the Englifh government there, i. 110. Hiftorical view of 
the European trade wuh thofe countries, 319. Rice countries 
more populous and rich than corn countries, 321. The real price 
of labour lower in China and Indoltan, than in the greater part 
of Europe* 322. Gold and fiiver the moil profitable commodities 
to carry thither, 323. The* proportional value of gold to fiiver, 
how rated there, 330. 

great extenfion of foreign commerce by the difcovery of a 

pafiage to, round the Cape of Good Hope, ii. 170. Hiftorical re- 
view of the intercourfe with, 171. Effect of the annual exportation 
of fiiver to, from Europe, 172. The trade with, chiefly carried on 
by exclufive companies, 467. Tendency of their monopolies, 468. 

Company, a monopoly againft the very nation in which it 

is erefted, ii. 467. The operation of fuch a company in a poor 
and in a rich country compared, 469. That country whofe ca- 
pital is not large enough to tend to fuch a diftant trade ought not 
to engage in it, 473. The mercantile habits of trading compa- 
nies render them incapable of confulting their true interefts when 
they become fovereigns, 479. The genius of the adminiftratiqn 
of the Englifh company, 480. Subordinate practices of their 
agents and clerks, 481. The bad conduct of agents in India 
owing to their fituation, 484. Such an exclufive company a 
nuifance in every refpect, 485. 

brief review of their hiflory, iii. 131. Their privileges 
invaded, 132. A rival company formed, 133. The two compa- 
nies united, 135. Are infected by the fpirit of war and conqueft, 
136. Agreements between the company and government, ibid* 
Interference of government in their territorial adminiitration, 139. 
And in the direction at home, ibid. Why unfit to govern a great 
empire, 140. Their fovereign and commercial characters incom- 
patible, 245. How the territorial acquifitions of, might be ren- 
dered a fource of revenue, 462. 

Edinburgh, 



INDEX 

its prefent fhare of trade owing to the removal of the 
court and parliament, ii. 12. 
Education, the principal caufe of the various talents obfervable in 
different men, i. 24. 

thofe parts of, for which there are no public institutions, 
generally the beil taught, iii. 158. In universities a, view of, 168. 
Of travelling for, 171. Courfe of, in the republics of ancient 
Greece,'i 7 2. In ancient Rome, ibid. The ancient teachers fuperior 
to thofe in modern times, 179. Public iiiftitutions injurious to good 
education, 180. Inquiry how far the public ought to attend to the 
education of the people, 18 1. The different opportunities of edu- 
cation in the different ranks of the people, 185. The advantages of 
a proper attention in the Hate to the education of the people, 191. 

Egypt t the firit country in which agriculture and manufactures ap- 
pear to have been cultivated, i. .30. Agriculture was greatly 
favoured there, iii. 32. Was long the granary of the Roman 
empire, 35. 

Ejefttnenty action of, in England, when invented, and its operation, 
ii. 93. 

Employments, the advantages and difadvantages of the different kinds 
of, in the fameneighbouroood, continually tend no equality, i. 151. 
The differences or inequalities among, fpecifie4, 152. The con- 
ftancy or precarioufnefs of, influences the rate of wages, 157. 

England, ihe dates of its feveral fpecies of coinage, filves gold, and 
copper, i. 58. Why labour is cheaper there, th^n in North Ame- 
rica, 105. The rate of population in both countries compared, 106. 

the produce and labour of, have gradually increafed frona 

the earlieft accounts in hiitory, while writers are reprefenting the 
country as rapidly declining, ii. 24. Enumeration of obltruc- 
tions and calamities which the profperity of the country has fur- 
mounted, 25. C ire um fiances that favour commerce and manu- 
factures, 133. Laws in favour of agriculture, 134. Why formerly 
unable to carry on foreign wars of long duration, 165. Why the 
commerce with France has been fubjete<l to fo many difcourage- 
ments, 247. Foundation of the enmity between thefe countries, 
249. Translation of the commercial treaty concluded in 1703, 
with Portugal, 325. Inquiry into the value of the trade with 
Portugal, 328. Might procure gold without ihe Portugal trade, 
329. Confequences of fecuring the colony trade by the navigation 
aft, 409. 

EngroJJlng. See Foreftalling. 

Entails, the law of, p. events the diviuon of land by alienation, ii, 
82. Intention of, 84. 

Europe, general review of the feveral nations of, as to their improve- 
ment iince the difcovery of America, i. 316. The two richeil 
countries in, enjoy thegreatefl fhares of the carrying trade, ii. 69. 
Inquiry into the advantages derived by, from the difcovery and 
colonization of America, 400. The particular advantages de- 
rived by each colonizing country, 404. And by others which 
have no colonies, 460. 

i i 3 Exchange, 



I N D E X. 

Exekatigt, the operation of, in the commercial intercourfe of different 
countries, ii. 144. The courfe of, an uncertain criterion of the 
balance of trade between two countries, 213. Is generally in favour 
of thofe countries which pay in bank money, againft thofe which 
pay in common currency, 234. 

Excife, the principal objecls of, iii. 345. The duties of, more clear 
and diftincl: than Hhe cuftoms, 352. Affeds only a few articles of 
the moft general confumption, 353. The excife fcheme of Sir 
Robert Walpole defended, 358. The excife upon home made fer- 
mented and fpirituous liquors, the moft productive, 360. Expence 
of levying excife duties computed, 375. The laws of, more vexa- 
tious than thofe of the cuftoms, 380. 

Exercife, military, alteration in, produced by the invention of fire- 
arms, iii. 57. 

Expences, private, how they influence the national capital, ii. 28. The 
advantage of beftowing them on durable commodities, 30. 

Export trade, the principles of, explained, ii. 67. When rude pro- 
duce may be advantageoufly exported, even by a foreign capital, 79, 
Why encouraged by European nations, ii. 173. By what means 
promoted, 174. The motives to, and tendency of, drawbacks 
of duties, 252. The grant of bounties on, confidered, 261. Ex- 
portation of the materials of manufactures, review of the reftrainu 
and prohibitions of, ii. 494. 



Faitb, articles of, how regulated by the civil magiftrate, iii. 208. 

Families feldom remain on large cftatcs for many generations in com- 
mercial countries, ii. 129. 

Famine. See Dearth, 

Farmers of land, the feveral articles that compofe their gain, diftin- 
guifhed, i. 80. Require more knowledge and experience than the 
generality of manufacturers, 1 96. In what their capitals confiit, 41 3 . 

' ' the great quantity of productive labour put into motion by 
their capitals, ii. 52. Artificers neceffary to them, 77. Their 
fituation better in England than in any other part of Europe, 93. 
Labour undergreat disadvantages every where, 97. Origin of long 
leafes of farms, 128. Are a clafs of men leaft fubjel to the 
wretched fpirit of monopoly, 191. Were forced/by old ftatutes, 
to become the only dealers in corn, 300. Could not fell corn 
cheaper than any other corn merchant, 301. Could feldom fell it ib 
cheap, 302. * The culture cf land obftrufted by this divifion of 
their capitals, 304. The ufe of corn dealers to the farmers, 305. 

how they contribute to the annual production of the land, ac- 
cording to "the French agricultural fyftem of political ceconomy, 
iii. 4^ 

- ' of the public revenue, their character, iii. 387. 416. 

Feudal government, miferable ftate of the occupiers of land cnder, 
ii. 7. Trade and huereft of money under, 9, Feudal chiefs, their 

power, 



INDEX. 

power, 82. Slaves, their fituation, 87. Tenures of land, go. 
Taxation, 96. Original poverty and fervile (late of che tradefmen 
in towns, 100. Immunities feldom granted but for valuable con- 
^derations, 101. Origin of free burghs, 102. The power of 
the barons reduced by municipal privileges, 105. The caufe 
and effeft of ancient hofpitality, 119. Ex-enfive power of the 
ancient barons, 121. Was not eflabiilhed in England until the 
Norman conqueft, 123. Was filently fubverted by manufactures 
and commerce, 125. 

Feudal wars, how fupported, iii. 49. Military exercifes not well 
attended to, under, 52. Standing armies gradually introduced to 
fupply the place of the feudal militia, 66. Account of the cafual- 
ties or taxes under, 314. Revenues under, how enjoyed by the great 
landholders, 395. 

Fiars, public in Scotland, the nature of the inftitution explained, 

; ? 8 +- 

Fines for the renewal of leafes, the motive for exa&ing them, and 
their tendency, iii. 264. 

Fire arms, alteration in the art of war, effected by the invention of, 
iii. 57. 71. The invention of, favourable to theexienilon of civi- 
lization, 72. 

fifoi the component parts of the price of, explained, i. 77. The 
multiplication of, at market, by human induftry, both limited and 
uncertain, i. 370. How an increafe of demand raifes the price of 
fifh, 371. 

Fijberies, obfervations on the tonnage bounties granted to, ii. 281. 
To the herring fifhery, 282. The boat fifhery ruined by this 
bounty, 285. 

Flander*, the ancient commercial profperity of, perpetuated by the 
folid improvements of agriculture, ii. 137. 

Flax, the component parts of che price of, explained, i. 76. 

Fleetivood, bilhop, remarks , on his Chronicoo Preiiofum, i. 285. 
289. 

Flour, the component parts of the price of, explained, i. 76. 

Food, will always purchafe as much labour as it can maintain on the 
fpor, i. 227. Bread and butchers' meat compared, 230. 235. Is 
the original fource of every other production, 257. The abundance 
of, conllitutes the principal part of the riches of the world, and gives 
the principal value to many other kinds of riches, 272. 

Fore/Jailing and engroffing, the popular fear of, like the fufpicions 
of witchcraft, ii. 309. 

Forts, when neceffary tor the protection of commerce, iii. 107. 

France, fluctuations in the legal rate of inf reit for money therfi,durir\g 
the courfe of the prefer t century, i. 137. Remarks on the trade 
and riches of, 138. The nature of apprenticeships there, 187. 
The propriety of retraining the planting of viney?r.j s , <mined> 
i, 240. Variations in the price of grain there, 282. The 
money price of labour has funk gradually with the money price 
of COM, 313. Foundation of the Miffiffippi fcheme, 478. 

i x 3 Franc*, 



INDEX. 

France, little trade or induftry to be found in the parliament towns 
of, ii. 10. Defcr'ption of the clafs of farmers called metayers, 90. 
Laws relating to the tenure of land, 95, Services formerly exacted 
befide rent, ibid. * The taille, what, and its operation in check- 
ing the cultivation of land, 0,6. Origin of the magiitrates and 
councils of ciries, 107. No direct legal encouragement given to 
agriculture, 135. Ill policy of M. Colbert's commercial regula- 
tions, 200. French goods heavily taxed in Great Britain, 209. 
The commercial intercourfe between France and England now 
chiefly carried on by fmugglers, 210. The policy of the com- 
mercial reftraints between France and Britain considered, 211, 
State of the coinage there, 217. Why the commerce with ,Eng- 
land has been fubjfded to difcouragement, 247. Foundation of 
the enmity between thefe countries, 249. Remarks concerning 
the feignorageon coin, 335. Standard of the gold coin there, 336. 
The trade of the French colonies, how regulated, 37 8. The govern- 
ment of the colonies conducted with moderation, 593. The fugar 
colonies of, better governed than thofe of Britain, 394. The king- 
dom of, how taxed, 449. The members of the league fought more 
in defence of their own importance, than for any other caufe, 455. 

the prefent agricultural fyftem of political ceconomy adopted 

by philofophers there defcribed, iii. 4. Under what direction 
the funds for the repair of the roads, are placed, 101. Ge- 
neral ftate of the roads, 102. The univerfities badly governed, 155. 
Remarks on the management of the parliaments of, 2 1 1 . Meafures 
taken in, to reduce the power of the clergy, 220. Account of 
the mode of rectifying the inequalities of the predial taille in the 
generality of Montauban, 273. The perfonal taille explained, 303. 
The inequalities in, how remedied, 306. How ifie perfonal taiHe 
difcourages cultivation, 308. The Vingtieme, 31 1, Stamp-duties 
and the controle, 317. 320. The capitation tax, how rated, 329. 
Reftraints upon the interior trade of the country by the local variety 
of the revenue laws, 383. The duties on tobacco and fait, how 
levied, 388. The different fources of revenue in, 389. How the 
finances of, might be reformed, 390. The French fyftem of tax- 
ation compared with that in Britain, 391. The nature of tontines 
explained, 413. Eftimate of the whole national debt of, 414. 

Frugality, generally a predominating principle in human nature, ii. 19. 

Fuller's earth, the exportation of, why prohibited, ii. 505. 

Funds, Britifb, brief hiftorical view of, iii. 403. Operation of, po- 
litically confidered, 424. The practice of funding has gradually 
enfeebled every ftate that has adopted it, 4^1, 

fur trade, the firit principles of, i. 253. 



Gama, Vafco de, the firft European who difcovered a naval track to 
the Bait Indies, 348, 



INDEX. 

Gardening* the gains from, diflingtifhed into the Coupe nent parts, 
i. 81. Net a profitable employment, 237. 

Gems. See Stones. 

General fund, in the Britifh finances, explained, iii. 408. 

Genoa t why corn is dear in the territory of, i. 298. 

Glafgoiv, the trade of, doubled in fifteen years, by creeling banki 
there, i. 442. Why a city of greater trade than Edinburgh, 
ii. 12. 

Gold> not the ftandard of value in England, i. 59. Its value measured 
by filver, 60. Reformation of the gold coin, 61. Mint price of 
gold in England, 62. i he working the mines of, io Peru, very 
unprofitable. 267. Qualities for which this metal is valued, 269. 
The pcrportionate value of, to filver, how rated before and after the 
difcovery of the American mines, 330. Is cheaper in the Spanifh 
market than filver, 333. Great quantities of, remitted annually 
from Portugal to England, ii. 327. Why little of it remains in 
England, 329. Is always to be had for its value, 330. 

GW/ahdy#-t;<rr, the prices of, how affected by the increafe of the 
quantity of the metals, i. 294. Are commodities that naturally feek 
the bed market, 295. Are metals of the leait value among the 
pooreft nations, 297. The increafe in the quantity of, by means 
of wealch and improvement, has no tendency to diminish their value, 
299. The annual confumpticn of thefe metals very conficlerable, 
324. Annual importation of, into Spain and Portugal, ^25. Are 
not likely to multiply beyond the demand, 328. The durability of, 
the caufe of the fleadinefs of their price, 329. On what circum- 
ftances the quantity of, in every particular country, depends, 372. 
The low value of thefe metals in a country, no evidence of its 
wealth, nor their high value of its poverty, 377. 

. if not employed at home, will be fent abroad notwithftanding 

all prohibitions, ii. 17. Thereafon whyEuropean nations have ftudied 
to accumulate thefe metals, 141. Commercial arguments in favour 
of their exportation, 142. Thefe, and all other commodities, are 
mutually the prices of each other, 148. The quantity of, in 
every country, regulated by theerteclual demand, 149. Why the 
prices of thefe metals do not fluctuate fo much as tnofe of other 
commodities, 150. To preferve a due quantity of, in a country, 
no proper object of attention for the government, 151. The ac- 
cumulated gold and ft[ver in a country diftinguifhed into three 
parts, 158. A great quantity of bullion alternately exported and 
imported for the purpofes of foreign trade, 162. Annual amount 
of thefe metals imported into Spain and Portugal, 163. The im- 
portation of, not the principal bent-fit derived from foreign trade, 
167. The value of, how afFeded by the difcovery of the American 
mines, 168. And by the paflage round the Cape of Good Hope 
to the Eaft Indies, 170. Efrecl: of the annual exportation of filver 
to the Eaft Indies, 172. The commercial means purfued to increase 
the quantity of thefe metals in a country, 173. 209. Bullion hov 
received and paid auhe bank of Amiterdam, 223, At what prices, 

i i 4 225, 



INDEX. 

225, Note. A trading country without mines, not likely to be 
exhaufted by an annual exportation of thefe metals, 240. The 
value of, in Spain and Portugal, depreciated by restraining the ex- 
portation of them, 271. Are not imported for the purpofes of plate 
or coin, but for foreign trade, 331. The fearch after mines of, 
the mofl ruinous of all projects, 354.- Are valuable, becaufe 
fcarce, and difficult to be procured, 355. 

Gcrgias, evidence of the wealth he acquired by teaching, 5. 208. 
Government, civil, indifpenfably neceflary for the fecuricy of private 
property, iii. 73. Subordination in fociety by what means intro- 
duced, 74. Inequality of fortune introduces civil government for 
its prefervation, 80. The adminiftration of juftice, a fourceof re- 
venue in early times, 81. Why government ought not to have the 
management of turnpikes, 99. Nor of other public works, 105. 
Want of parfimony during peace, impofes a neceffity of contracting 
debts to carry on a war, 399. Mull fupport a regular ad mi nitra- 
tion of juftice to caufe manufactures and commerce to flounfn, 400. 
Origin of a national debt, 401 . Progreffion of public debts, 402. 
War, why generally agreeable to the people, 417. 
Governors, political, the greateft fpendthrifts in fociety, ii. 27. 
Grafles, artificial, tend to reduce the price of butchers' meat, i. 234. 
Graziers, fubjeft to monopolies obtained by manufactures to their 

prejudice, ii. 506. 

Gr**r*,foreign trade promoted in feveral of the ancient Hates of, iii. 36. 
Military exercifes, a part of general education, 52. Soldiers not 
a diftind profeffion in, 53. Courfe of education in the republics 
of, 172. The morals of the Greeks inferior to thofe of the Ro- 
mans, Hid. Schools of the philofophers and rhetoricians, 175. 
Law no fcience among the Greeks, 176. Courts of juftice, 177. 
The martial fpiritof the people how fupported, 188. 
Greek colonies, how diftinguithed from Roman colonies, ii. 346* 

Rapid progrefs of thefe colonies, 360. 
Greek language, how introduced as a part of univerfity education, 

iii. 162. PhiJofophy, the three great branches of, 163. 
Graund rents, great variations of, according to fituation, iii. 281. 

Are a more proper fubject of taxation than houfes, 286. 
Gum fenega, review of the regulations impofed on the trade for, 

ii. 509. 

Gunpowder, great revolution effected in the art of war by the in- 
vention of, iii. 57-71. This invention favourable to the exten- 
fion of civilization, 72. 

us Vafa, how enabled to eftablifh the reformation in Sweden, 
iii. 223. 



H 

Hanfeatic league, caufes that rendered it formidable* ii. 107. Why 
no veilige remains of the wealth of the iiacs town?, 13 



INDEX. 

Hamlurgb, agio of the bank of, explained, ii. 220. Sources of the 
revenue of that city, 242. 246. The inhabitants of, how taxed 
. to the itate, 298. 

. Company, feme accost of, iii. 112. 

Hearth money, why abolifhedin England, iii. 290. 
Henry VIII. of England, prepares the way for the reformation by 

{hutting out the authority of the Pcpe, iii. 224. 
Herring bufs bounty, remarks on, ii. 28 1. Fraudulent claims of the 
bounty, 284. The boatfjfhery the mcft natural and profitable, 285, 
Account of the Britifh white herring fifhf ry, 287. Account of the 
bufTes fitted out in Scotland, the amount of their cargoes, and the 
bounties on them, 519. 

Hides, the produce of rjde countries, commonly carried to a dif- 
tant market, i. 360. Price of, in England three centuries ago, 
365. Salted hides inferior to frefh ones, 366. The price of, 
how affected by circumftances in cultivated and in uncultivated 
countries, 368. 
Highlands of Scotland, interefting remarks on the population of, 

i. 120. Military characler of the Highlanders, ii:. 60. 
Holies, Mr. remarks on his definition of wealth, i. 45. 
Hogs, circumftances which render their flefli cheap or dear, i. 354. 
Holland, obfervations on the riches and trad* of the republic of, i. f 39. 
Not to follow fome bufinefs, unfashionable there, 147. .Caufe of 
the dearnefs of corn there, 298. 

enjoys the greateft (hare in the carrying trade of Europe, 

ii. 69. How the Dutch were excluded from being the carriers to 
Great Britain, 193. Is a country that profpers under the heavieft 
taxation, 199. Account of the bank of Amfterdam, 220 This 
republic derives even its fubfifteoce from foreign trade, 250. 

tax paid on houfes there, iii. 289. Account of the tax upon 

fucceflions, 313. Stamp duties, 316. High amount of taxes 
in, 340. 392. Its profperity depends on the republican form of 
government, 393. 
Honoraries, from pupils to teachers in colleges, tendency of, to 

quicken their diligence, iii. 152. 
Hofe, in ;Jie time of Edward IV. how made, i. 389. 
Hofpitality, ancient, the caufe and effeft of, ii. 119. iii. 395.' 
Houfe, different acceptations of the term in England, and lome other 
countries, i. 182. Houfes confidered as part of the national (lock, 
414. Houfes produce no revenue, 415. 

. . the rent of, diftinguiftied into two parts, iii. 280. Operation 
of a u.: upon houfe rent, payable by the tenant, 281. Iloufe 
rent the btft trft of the tenant's circumftances 285. Proper 
regulation of a tax on, ibid. Iriow taxed in Holland, 289. Health 
money, 290. Window tax, ibid. 
Hudfon& bay compary, the nature of their eftabli foment and trade, 

iii. 126. J r:r profits not i r i high 3fi has been reported, 128. 
ffunttrs. war hor Supported by a auion of, iii. 44. Cannot be very 
numerous, 46. No eftablifhcd adminiftration of juilice needful 

amcng 



INDEX. 



among them, 72. Age the fole foundation of rank and precedency 
among, 75. No coniiderable inequality of fortune, or fubordina- 
tion to be found among them, 76. No hereditary honours in fuch 
a fociety, 78. 

Hujlandmen y war how fupported by a nation of, Hi. 47. 
dry. See Agriculture. 



J 

"Jamaica, the returns of trade from that ifland, why irregular, iii. 457. 

Idlenefs unfafhionable in Holland, i. 147. 

Jfwe/s. See Stones. 

Importation, why reftraints have been impofed on, with the two kinds 
of, ii. 173. How retrained to fecure a monopoly of the home- 
market to domeftic incuftry, 176. The true policy of thefe re- 
ftraints doubtful, 177. The free importation of foreign manufac- 
tures more dangerous than that of raw materials, 187. How far it 
may be proper to continue the free importation of certain foreign 
goods, 199. How far it may be proper TO reftore ihe free import- 
ation of goods, after it has been interrupted, 202. Of the ma- 
terials of manufacture, review of the legal encouragements given 
to, 486. 

Independents, the principles of that feel explained, iii. 201. 

Indies. See Eaft and Weft. 

lndojlan t the ieveral claffes of people there kept diftinft, iii. 35. 
The natives of, how prevented from undertaking long fea voy- 
ages, 34. 

Induftry, the different kinds of, fel'dom dealt impartially with by any 
nation, i. 4. The fpecies of, frequently local, 26. Naturally 
fuited to the demand, 87. Is increafed by the liberal reward of 
labour, 124. How affected by feafons of plenty and fcarciry, 126. 
Is more advantageoufly exerted in towns than in the country, 194. 
The average produce of, always fuired to the average con fumpiio-n, 
292. Is promoted by the circulation of paper money, 438. 
Three rcquifites to putting induftry in motion, 450. 

how the general charackr of nations is eftimated by, ii. 9. And 
idlenefs, the proportion between, how regulated, 12. Is employed 
for fubfiftence, before it extends to conveniences and luxury, 75. 
Whether the general induftry of a fociety is promoted by commer- 
cial reftraints on importation, 177. Private intereft naturally points 
to thar employment moft advantageous to the fociety, 178. But 
without intending or knowing it, 181. Legal regulations of 
private induftry, dangerous aflumptions of power, 182. Domeftic 
induttry ought not to be employed on what can be purchafed cheaper 
from abroad, 183, Of the fociety, can augment only in propor- 
tion as its capital augments, 184. When it may be neceflary to 
jiripofe forae burden upon foreign induftry, to favour that at home, 
192. The free exercife of induflry ought to be allowed to all, 205. 

The 



INDEX. 

The natural effort of every individual to better his condition will, 
if unreftrained, refuh in the profperny of the fociety, 319. 

2a/'uranct 9 from fire, and fea riiks the nature and profits of, ex- 
amined, i. 165. The trade of infurance may be fuccefsfully car- 
ried on by a joint Hock company, iii. 147, 148. 

Jntercft, landed, monied, and trading, diftinguiihed, ii. 35. 

for the ufe of money, the foundation of that allowance ex- 

plaired, i. 79. Hiftorical view of the aherations of, in England, 
and oiher countries, 135. Remarks on the high rates of, in Bfn- 
gal, 143. And in China, 145. May be raited by defcdive laws, 
independent on the influence of wealth or poverty, ibid. The 
loweft ordinary rate of, mult iboicwliac rrore than com pen fate oc- 

, cafional Icfies, 146. The common relative proportion between 
interelt and mercantile profits inquired into, 148. 

was not lowered in confeqnence of the difcovery of the 

American nrr.es, ii. 39. How the legal rare of, ought to be fixed 
43. Confluences of its being fixed tco high or too low, 44, 
The market rate of, regulates the price of land, 45. Whether a 
proper object of taxatior, iii. 294. 

Ireland, why never likely to forrulh cattle to the prejudice of Great 
Britain, ii. 187. The propofed abfehtee tax there confidered, iii. 
373. Ought in juttice to contribute toward the difcharge of the 
public debt of Great Britain, 459. Expediency of an union with 
Great Britain, 460. 

Ifocrates, the handfome income he made by teaching, i. 207. 

Italy, the only great country io Europe, which has been coltiva/ed 
and improved in every part by means of irs foreign commerce, ii. 
135.. Was originally colonized by the Doriara, 343. 

JurifdifiionSy territorial, did not originate in the feudal law, ii. 122. 

jfu/}ice t the adminiltration of, a duty of the fovefeign, iii. 72. In 
early times a fource of revenue to him, 81. The making juftice 
fubferyient to the revenue, a fource of great abufes, 82. Is never 
adminiilered gratis, 85. The whole adminiitration of, bat an in- 
confiderable part of the expence of government, 86. How the 
whole fxpence of juftice might bs defrayed from the fees of court, 
ibid. The interference of the jurifdiclions of the feveral Engiifk 
courts of law, accounted for, 88. Law language, how corrupted. 
90. The judicial and executive power, why divided, 91. By 
whom the expence of the adminiftration o/, ought to be borne, 
238. 



K 

Kalm, the Swedifh traveller, his account of the hulbandry of the 

Britidi colonies in North America, i. 349. 
Kelp, a rent demanded for the rocks on which it grows, i. 224. 

under feudal inftitutions, no more than the greateft baron in the 
nation, ii. 1 22. Was unable to reitrain the violence of his barons, 1 24. 
1 Kir* 




INDEX. 

Jfflg-* trcafure trove an important branch of revenue to, 111. 396. 

His fituation how favourable for the accumulating treafure, 397. 

In a commercial country, naturally fpends his revenue in luxuries, 

ibid. Is hence driven to call upon his fubjects for extraordinary 

aids, 398. 

King* Mr. his account of the average price of wheat, i. 306. 
Kings and their minifters, the greateft fpendihrifts in ft country, 

ii. 27. 



Labour* the fond which originally fupplies every nation with its annual 
confumption, i. i. How the proportion between labour and con- 
fumption is regulated, ibid. The different kinds of irtduftryfeldom. 
dealt impartially with by any nation, 4. The divifion of labour 
confidered, .6. This divifion increafes the quantity of work, n. 
Inftances in illuftration, 17. From what principle the divifion of 
labour originates, 19. The divifibility of, governed by the mar- 
ket, 26. Labour the real meafure of the exchangeable value of com- 
modities, 44. Different kinds of, not eafily eftimated by imme- 
diate cornparifon, 45 . Is compared by the intermediate ftandard of 
money, 46. Is an invariable ftandard for the value of commodi- 
ties, 48. Has a real and a nominal price, 49. The quantity of 
labour employed on different objects, the only rule for exchanging 
-them in the rude ftages of fociety, 70. Difference between the 
wages of labour and profits on ftock, in manufactures, 72. The 
whole labour of a country never exerted, 81. Is in every, inftance 
fuited to the demand, 87. Theeffectof extraordinary calls for, 89. 
The deductions made from the produce of labour employed upon, 
land, 98. Why dearer in North America than in England, 105, 
Is cheap in countries that are ftationary, 107. The demand for, 
would continually decreafe in a declining country, 109. The pro- 
vince of Bengal cited as an inftance, no. Is not badly paid for 
in Great Britain, in. An increafing demand for, favourable to 
population, 121. That of freemen cheaper to the employers than 
'that of flaves, 122. The money price of, how regulated, 130. 
Is liberally rewarded in new colonies, 140. Common labour and 
ikilful labour diftinguiihed, 155. The free circulation of, from one 
employment to another, obftructed by corporation laws,5n. The 
unequal prices of, in different places probably owing to the law of 
fettlements, 218. Can always procure fubfittence on the fpot 
where it is purchafed, 227. The money price of, in different 
countries, how governed, 297. Is fet into motion by ftock em- 
ployed for profit, 396. The divifion of, depends on the accumu- 
lation of itock, 408. Machines to facilitate labour advantageous 
to fociety, 426. 

- . . productive and unproductive, diftinguifh^d, ii. i. Various 

orders of men fpecified, whole labour is unproductive, 3. Unpro- 

& - duftivt 



INDEX. 

labourers all maintained by revenue, 5. The price of, ho\Y 
raifed by the increafe of the national capital, 38. Its price, 
though nominally r^ifed, may continue the fame, 41. Is liberally 
rewarded in new colonies, 358. 

Labour of artificers and manufacturers, never adds any value to the 
whole amoynt of the rude produce of the land, according to the 
French agricultural fyftetn of political ceconomy, iii. 9. This 
doctrine {hewn to be erroneous, 23. The productive powers of 
labour, how to be improved, 25. 

labourers, ufeful and productive, every where proportioned to the ca- 
pital (lock on which they are employed, i. 3. Share the produce 
of their labour, in moil cafes, with the owners of the (lock on which 
they are employed, 74. Their wages a continued fubject of conteft 
between them and their mailers, 99. Are feldom fucceLful in their 
outrageous combinations, 101. The fufficiency of their earnings, a 
point not eafily determined, 102. Their wages fometimes raifed 
by increafe of work, 103. Their demands limited by the funds 
deftined for payment, 104. Are continually wanted in North Ame- 
rica, 107. Miferable condition of thofe in China, 108, Are not 
ill paid in Great Britain, 1 1 1. If able to maintain their families 
in dear years, they muft be st their eafe in plentiful feafons, 112. 
A proof furniihed in the complaints of their luxury, 119. Why 
worfe paid than artificers, 156. Their interefts ftriftly connected 
with the interefts of the fociety, 395. Labour the only fource of 
their revenue, 410. Effects of a life of labour on the underftand- 
ings of the poor, iii. 182. 

Land, the demand of rent for, how founded, i. 74. The rent paid, 
enters into the price of the greater part of all commodities, 75. 
Generally produces more food than will maintainable labour ne- 
celTary to bring it to market, 227. Good roads, and navigable 
canals, equalize difference of fituation, 228. That employed in 
raifing food for men or cattle, regulates the rent of all other culti- 
vated land, 237. 247. Can clothe and lodge more than it can 
feed, while uncultivated, and the contrary, when improved, 252. 
The culture of land producing food, creates a demand for the pro- 
duce of other lands, 272. Produces by agriculture a much greater 
quantity of vegetable, than of animal food, 293. The full im- 
provement of, requires a (lock of cattle to fupply manure, 345. 
Caufe and effect of the diminution of cottagers, 354. Signs of the 
land being completely improved, 358. The whole annual pro- 
duce, or the price of it, naturally divides itfelf into rent, wage?, 
and profits of flock, 394. 

the ufual price of, depends on the common rate of intereft for 

money, ii. 44. The profits of cultivation exaggerated by projectors, 
71. The cultivation of, naturally preferred to trade and manufac- 
tures, on equal terms, 76. Artificers neceflary to the cultivation 
of, 77. Was all appropriated, though not cultivate 1, by the nor- 
thern deftroyers of the Roman empire, 8 1 . Origin of the law of 
primogeniture under. the feudal government, 82. Entails, 84. 

Obfttcto 



INDEX. 

Obftacles to the improvement of land under feudal proprietors, 86. . 
Feudal tenures, 90. Feudal taxation, 96. The improvement of 
]and checked in France by the taille, Hid. Occupiers of, labour 
under great difadvantages, 97. Origin of long leafes of, 128. 
Small proprietors, the bell improvers of, 1 3 1 . Small purchafers of, 
cannpt hope to raife fortunes by cultivation, 132. Tenures of, in 
the Britifh American colonies, 370. 

Land, is the moft permanent fource of revenue, iii. 248. The rent 
of a whole country, not equal to the ordinary levy upon the 
people, 249. The revenue from, proportioned, not to the renr, 
but 10 the produce, 252. Reafons for felling the crown lands, 253. 
The land-tax of Great Britain, confidered, 259. An improved land- 
tax fuggefted, 264. A land-tax, however equally rated by a ge- 
r.eral fusvey, will foon become unequal, 272. Tyrhes a very un- 
equal tax, 274. Tythes diicourage improvement, 275. 

landholders, why frequently inattentive to their own particular inte- 
iefts % i. 394. How they contribute to the annual production of 
the land, according to the French agricultural fyflem of political 
eeconomy, iii. 4. Should be encouraged to cultivate a part of 
their own land, 266. 

Latin language, how it became an eflential part of univerfity educa- 
tion, iii. 161. 

Law, the language of, how corrupted, iii. 90. Did not improve 
into a fcitnce in ancient Greece, 176. Remarks on the courts of 
j.uftice in Greece and Rome, 177. 

Ztfw, Mr. account of his banking fcheme for the improvement of 
Scotland, i. 478. 

Lawyers, why amply rewarded for their labour, i. 160. Great 
amount of their fees, iii. 85. 

Leafef t the various ufual conditions of, ii. 264. 

Leather, reftri&ions on the exportation of unmanufactured, ii. 506. 

Le&ures in univerfities, frequently improper for inftruction, iii. 
156. 

"Levity, the vices of, ruinous to the common people, and therefore 
feverely cenfured by them, iii. 203. 

Liberty, three duties only neceflary for a fovereign to attend to, for 
fupporting a fyftem of, iii. 42, 

Lima, computed number of inhabitants in that city, ii. 363. 

Linen manufacture, narrow policy of the matter manufacturers in, 
ii. 487. 

Literature, the rewards of, reduced by competition, i. 206. Was 
more profitable in ancient Greece, 207. The cheapnefs of literary 

. education an advantage to the pubiic, 209. 

Loans of money, the nature of, anatyfed, ii. 35. The extenfive ope- 
ration of, 36. 

Locke, Mr. remarks on his opinion of the difference between the 
market and mint prices of filver bullion, i. 64. His account of the 
caufe of lowering the rates of intereft for money examined, ii. 39. 
His diftinction between money and nioveable goods, 140. 

Lodgings* 



INDEX. 

Lodgings, cheaper in London than in any other capital city in Eu- 
rope, i. 182. 

Logic, the origin and employment of, iii. 165. 

Lotteries* the true nature of,and the caufes of their fuccefs, explained, 
i. 164. 

Luck, inrtances of the univerfal reliance mankind have on it, i. 164. 

Lutherans, origin and principles of that feet, iii. 225. 

Luxuries, diftinguifhed from neceflaries, iii. 331. Operation of 
taxes on, 334. The good and bad properties of taxes on, 374. 



M 

MaceJon, Philip of, the fuperiority that difcipline gave his army over 
thofeof his enemies, iii. 61. 

Machines for facilitating 'mechanicaj operations, how invented and 
improved, i. 14. Are advantageous to every fociety, 426. 

"Madder, the cultivation of, long confined to Holland by EngliQi 
tithes, iii. 276. 

Madeira wines, how introduced into North America and Britain, 
ii. 257. 

Malt, reafons for transferring the duty on brewing to, iii. 363. Di- 
ftillery, how to prevent fmuggling in, 366. 

Manufactures, the great advantages refuhing from a divifion of labour 
in, i. 7. Inftances in illustration, 17. Why profits increafe in the 
higner ftages of, 76. Of what parts the gain of manufactures 
confift, 80. The private advantage of fecrets in manufactures, 91* 
Peculiar advantages of foil and fituation, ibid. Monopolies, QZ. 
Corporation privileges, 93. The deductions made from labour em- 
ployed on manufactures, 99. Inquiry how far they are affected by 
feafons of plenty and fcarchy, 128. Are not fo materially affected 
by circumftances in ihe country where they are carried on, as in 
the places where they are confumed, 129. New manufactures ge- 
nerally give higher wages than old ones, 176. Are more profitably 
carried on in towns than in the open country, 194. By what means 
the prices of, are reduced, while the fociety continues improving, 
384. Inftances in hard-ware, 385. Inftances in the woollen ma- 
nufacture, 386. What fixed capitals are required to carry on par- 
ticular manufactures, 412. 

.. for diftant fale, why not eftabli/hed in North Ame- 

rica, ii. 78. Why manufactures are preferred to foreign trade, 
for the employment of a capital, 79. Motives co the eftablifhmenc 
of manufactures for diitant fale, 1 12. How ftjifted from one coun- 
try to another, 1 1 3, Natural circumltances which contribute to the 
ciiablimmenc of them, 114. Their effect on the government and 
manners of a country, 119. The independence of artifans ex- 
plained, 1 26. May flourish amidft the ruin of a country, and begin 
to decay on the return of its profperity, 16^. Inquiry how far ma. 

nu failures 



INDEX. 

tiufsclurea might be affected by a freedom of trade, 202. Thofe 
thrown out of one bufinefs can transfer their induftry to collateral 
employments, 205. A fpirit of combination among them to fup- 
port monopolies, 206. Manufactures prohibited by old ftatutes 
from keeping a fhop, or felling their own goods by retail, 300. 
The ufe of wholefaie dealers to manufacturers/ 304. Britifh re- 
ftraints on manufactures in North America, 385. The exportation 
of inftruments in, prohibited, 512. 

Manttfa3urers t an unproductive clafs of the people, according 
,10 ihe French agricultural fyftem of political ceconomy, iii. 7. 
The error of this doctrine ihewn, 21. How manufacturers aug- 
ment the revenue of a country, 26. Why the principal fupport 
of foreign trade, 31. Require a more extenfive market than 
jude produce of the land, 34. Were exercifed by flaves in ancient 
Greece, $j. High prices of, in Greece and at Rome, 38. Falfe 
policy to check manufacture* in order to promote agriculture, 
41. In Great Britain why principally fixed in the coal coun- 
tries, 338. 
Manurt, the fupply of, in moft places depends on the ftock of cattle 

raited, i. 345. 
Maritime countries, why the firlt that are civilized and improved, 

i. 28. 

Martial fpirit, how fuppported in the ancient republics of Greece 
and Rome, iii. 188. The want of it now fupplied by (landing 
armies, 1 89. The eftablimment of a militia little able to fupport 
it, 190. 

^Mediterranean fea peculiarly favourable for the firft attempts in navi- 
gation, i. 30. 

.Megrens, Mr. his account of the annual importation of gold and 
ftlver into Spain and Portugal, i. 325. His relative proportion 
pfeach, 331. 

Mercantile iyitern explained, iii. 348. 
Mercenary troops, origin and reafon of, iii. 50. The numbers of, 

how limited, 51. 

^Merchants, their judgments more to be depended on refpecting the 
interells of their particular branches of trade, than with regard to 
the public inten-ft, i. 397. Their capitals altogether circulating, 
412. Their dealings extended by the aid of bankers' notes, 446.- 
456. Cuftoms of, firfl eflablifhed to fupply ihe want of laws, and 
afterward admitted as laws, 464. The manner of negotiating bills 
of exchange explained, ibid. The pernicious tendency of drawing 
and redrawing, 465. 

*- in what method their capitals are employed, \\. 48. Their 

capitals difperfed and unfixed, 54, The principles of foreign 
trade examined, 67. Are tne beft of improvers, when they turn 
country gentlemen, 1 18. Their preference among the different 
fpecies of trade, how determined, 178. Are actuated by a nar- 
icw fpirit of monopoly, 224, The feverai branches of ihe corn 

trade 



INDEX. 

trade fpecified and confidercd, 291. The government of a com- 
pany of, the word a country can be under, 367. O^London, not 
good caconomifts, 439. 

Merchants, an unproductive clafs of men, according to the prefent 
agricultural fyftem of political ceconomy in France, iii. 11. The 
quick return of mercantile capitals enables merchants to advance 
money to government, 400. Their capitals incrcafed by lending 
money to the ftate, 401. 

Mercier, de la Riviere, M. character of his natural and effential order 
of political focieties, iii. 29. 

Metals, why the beft medium of commerce, i. 35. Origin of (lamp- 
ed coins, 37. Why different metals became the ftandard of value 
among different nations, 57. The durability of, the caufe of the 
iteadinefs of their price, 329. On what the quantity of precious 
metals in every particular country depends* 372-. 

reftraints upon the exportation of, ii. 507. 

Metaphyfecs, the fcience of, explained, iii. 166. 

Metayers^ defcription of the clals of farmers fo called in Prance, ii. 
90. 

Methodifts, the teachers among, why popular preachers, iii. 194. 

Methuen, Mr. tranflation of the commercial treaty concluded by 
him between England and Portugal, ii. 325. 

Mexico was a lefs civilized country than Peru, when firft vifited by 
the Spaniards, i. 317. 

prefent populoufnefs of the capital city, ii. 363. Low ftate 

of arts at the firft difcovery of that empire, ibid. 

Militia, why allowed to be formed in cities, and its formidable na- 
ture, ii. 107. 

the origin and nature of, explained, iii. 55. How diftin- 

guifhed from the regular Handing army, 56. ^ Mull always be in- 
ferior to a {landing army, 58. A few campaigns of fervice may 
make a militia equal to a Handing army, 60. Inftances, 61. 

Milk, a moil perifhable commodity, ho* manufactured for (lore, i. 

355' 
Mills, wind and water, their late introduction into England, i. 390. 

Mines, diftinguifhed by their fertility or barrennefs, i. 258. Compa- 
rifon between thofe of coal and thofe of metals, 262. The com- 
petition between, extends to all parts of the world, 263. The 
woiking of, a lottery, 266. Diamond mines not always worth 
working, 270. Tax paid to the king of Spain from the Peruvian 
mines, 314. The difcovery of mines not dependent on human 
fkill or induilry, 373. 

in Hungary, why worked at lefs expence than the neigh- 

bouiing ons in Turkey, iii. 38. 

Mining, projedb of, uncertain and ruinous, and unfit for legal en- 
couragement, ii. 354. 

Mirafaau, Marquis de, his character of the osconomical table, iii. 30. 

Mijpjptpi fcheme in France, the real foundation of, i. 478. 

Modus for tythe, a relief to the farmer, iii. 279. 
VOL. in. K K 



INDEX. 

t the origin of, traced, i. 35. Is the rcprefentative of labour, 
44. The valve of, greatly depreciated by the difcovery of the Ame- 
rican mines, 47. How different metals became the ftandard money 
of different nations, 57. The only part of the circulating capital 
of a fociety, of which the maintenance can diminish their neat 
revenue, 428. Makes no part cf the revenue of a fociety, 429. 
The term money, in common acceptation, of ambiguous meaning, 
430. The circulating money in fociety, no meafure of its re- 
venue, 432. Paper money, 434. The effect of paper on the 
circulation of cam, 436. Inquiry into the proportion the circu- 
lating money of any country bears to the annual produce circu- 
lated by it, 441. Paper can never exceed the value of the cam, 
of which it fupplies the place, in any country, 448. The perni- 
cious practice of raifing money by circulation explained, 465. 

the true caufe of its exportation, ii. 17. Loans of, the 

principles of, analyfed, 33. Monted intereft, diftinguifhed from the 
landed and trading iniereft, 35. Inquiry into the real caufes of 
the redaction of intereft, 39. Money and wealth fynonimous 
terms in popular language, 139. And moveable goods compared, 
140. The accumulation of, ftudied by the European nations, 142. 
The mercantile arguments for liberty to export gold and filver, 
ilid. The validity of thefe arguments examined, 145. Money 
and goods mutually the price of each other, 148. Over-trading 
caufes complaints of the fcarcity of money, 152. Why more eafy 
to buy goods with money, than to bay money with goods, 153. 
Inquiry into the circulating quantity of, in Great Britain, 160. 
Effect of the difcovery of the American mines on the value of, 
168. Money and wealth different things, 172. Bank money ex- 
plained, 220. See Coins, Gold, and Silver. 

Monopolies in trade or manufactures, the tendency of, 1.92. Are 
enemies to good management, 229, 

tendency of making a monopoly of colony trade, ii. 430. 
Countries which have colonies, obliged to (hare theirad vantages with 
manyothercountries,462.Thechiefen^ineinthemercantilefyftem, 
466. How monopolies derange the natural diftribution of the flock 
of the fociety, 468. Arefupported by unjuft and cruel laws, 494. 

of a temporaiy nature, how farjuftifiable, iii. 143, Per- 

petual monopolies injurious to the people at large, 144. 

Montaubawi the inequalities in the predial tallie in that generality, 
how rectified, iii. 273. 

Montefquieu, reafons given by him for the high rates of intereft among 
all Mahometan nations, i. 146. 

examination of his idea of the caufe of lowering th0 
rate of intereft of money, ii. 39. 

Morality^ two different fyiiems of, in every civilized focietv, iii. 202. 
The principal points of diftinction between them, 203. The ties 
of obligation in each fyftem, 204. Why the morals of the com- 
mon people are more regular in fectaries than under theeftabliflied 
chuicb, 205. The exccfles cf, bow to be corrected, 206. 

5 Morelhi 



INDEX. 

%$Gretlet, M. His accoant of joint flock companies, defective, 111* 145. 
Mun t Mr. his illuftration of the operation of money exported lor 

commercial purpcfes, ii. 14,. 
Mujic, why a part of the ancienc Grecian education, jii. 172. And 

dancing, great amufement among barbarous nations, 173. 



N 

fometimes driven to inhuman cuftom?, by poverty, 5. a 
The number of ufelul and productive labourers in, always pro-; 
portioned to the capital (lock on which they are employed, 3, 
The feveral forts of induflry feldom dealt impartially by, 4. Ma- 
ritime nation?, why the. firft improved, 28. 

- . - how ruined by a neglect of public (Economy, ii. 20. Evi- 
dences of the increafe of a national capital, 23. How the ex- 
pences of individuals may increafe the national capital, 28. 

Navigation, inland, a great means of improving a country in arts 
and indultry, i. 31. The advantages of, 229. 

* may be fuccefsfully managed by joint (lock companies* 

iii. 147. 

- aft of England, the principal difpofitions of, ii. 192; 

Motives th.it dictated this law, 194. Its political and commercial 
tendency, 195. Its confluences, fo far as it afFecled the colony 
trade with England, 409. Diminiflied the foreign trade with 
Europe, 41 1. Has kept up high profits in the Britifti trade, 413. 
Subjects Britain to a difadvantage in every braacli of trade of 
which ihe has not the monopoly, 4141 

NeceJJaries diftinguiftied from luxuries, iii. 331. Operation of taxes 
on, 333. Principal neceffaries taxed, 337. 

Ntgro (laves, why not much employed in railing corn in the Englifh 
colonies, ii. 89. Why more numerous on fugar than on tobacco 
plantations, 90. 

Nile, river, the caufe of the early improvement of agriculture and 
manufactures in Egypt, 31. 



Oats, bread made of, not fo fuitable to the human confutation* as 

that made of wheat, i. 251. 

Qeconotnijls, fed of, in Franc?, their political tenets, iii. 4. 
Ontology, the fcience of, explained, iii. 167. 
Oxford^ the profe/Tor (hip there, fnecurn, iii. 153, 



Paper monty t the credit of, how eftablJftic^, i. 434. The operation 
of paper money explained, 435. Its effect on ihe circulation of 

K K 2 calh, 



INDEX, 

cafh, 436. Promotes induftry, 438. Operation of the feveraJ 
banking companies eflablifhed in Scotland, 442. Can never ex- 
ceed the value of {he gold and filver, of which it fupplies the place, 
in any country, 448. Confequences of too much paper being 
ifFued, 449. The practice of drawing and redrawing explained^ 
with its pernicious effefts. 464. The advantages and difadvan- 
tages of paper credit ftate;J, 483. Jll effects of notes iflued for 
fmall fums, 487. SuppKefTmg fmall notes, renders money more 
plentiful, 488. The currency of, does not affect the prices of goods, 
490. Account of the paper currency in North America, 495. 
Paper money ', expedient of the government of Pennfylvania to raife 
money, iii. 246. Why convenient for the domeftic purpofes of 
the North Americans, 452. 
Parts enjoys little mere trade than is neceflary for the confaraption 

of its inhabitants, ii. 11. 
Parijh miniilers, evils attending veiling the election of, in the people, 

iii. 227. 

Parfemony is the immediate caufe of the increafe of capitals, ii. i*$ + 
Promotes induftry, 14. Frugal men public benefactors, 18. 

. is the only means by which artificers and manufacturers 

can add to the revenue and weahh of fociety, according to the 
French agricultural fyftem of political ceconomy, iii. 10. 
Pafture land, under what circumttances more profitable than arable 

land, i. 232. Why it ought to be inclofed, 234. 
Patronage, the right of, why eftablifned in Scotland, iii. 228. 
Pay, military, origin and reafon of, iii. 50. 

Pennsylvania, account of the paper currency there, i. 495. Good 
confequences of the government there having no- religious eftablilh- 
ment, iii. 201. Derive a revenue from their paper currency, 453. 
P0/>/, how divided into produ&ive and unproductive clafles, accord- 
ing to the prefent French fyftem of agricultural political ceconomy, 
iii. 4. The unproductive clafs,. greatly ufeful to the others, is. 
The great body of, hew rendered un warlike, 55. The different 
opportunities of education in the different ranks of, 185, Thein- 
ierior ranks ,of, the greateft confumers, 358. The luxurious ex- 
per.ces of ihefe ranks ought only to be taxed, 361. 
Perfection for religious opinions, the true caufe of, iii. 194. 
Peru, the difcovery of the filver mines ia, occasioned thofe in Europe 
to be in a great raeafare abandoned, i. 263. Thefe mines yield 
but fmall profit to the proprietors, 264. Tax paid to the kirg of 
Spain from thefe mines, 514. The early accounts of the fplendor 
and ilate of arts in this country, greatly exaggerated, 317. Pre- 
fent Itate of, under the Spaniih government, 318. The working 
of the mines there become gradually more expenfive, 335. 
__ low ftate of arts there when firft difcovered, ii. 363. Is pro- 
bably more populous now, than at any former period, 364. 
Pbilcjopby t natural, the origin and objecls of, iii. 163. Moral, the 
nature of, explained, 164. Logic, the origin and employment 
- f . 165. 



INDEX. 

, why amply rewarded for their labour, i. 160. 

Pbyjics, the ancient fyrtem of, explained, iii. 166. 

Ptnmaking, the extraordinary advantage of adivifion of labour in this 
art, i. 7. 

Plate of private families, the rr.eking it down to fupply ftate exi- 
gencies, an infignificant refource, ii. 159. New plate is chiefly 
made from old, 333. 

Ploughmen* thek knowledge more extenfive than the generality of 
mechanics, i. 197. 

Pneumatics , the fcience of, explained, iii. 166. 

Poivre, M. his account of the agriculture of Cochin China, i. 244. 

Poland, a country ftill kept in poverty by the feudal fyftem of its 
government, i. 376. 

Political ceconomy, the two diftinct objects, and two different fyf- 
tems of, ii. 138. 

< the prefent agricultural fyftem of, adopted by French 

philofophers, defcribed, iii. i. Clafles of the people who contri- 
bute to the annual produce of the land, 4. How proprietors con- 
tribute, ibid. How cultivators contribute, 5. Artificers and manu- 
facturers, unproductive, 7. The unproductive clafles maintained 
by the others, 1 1. Bad tendency of reftriiiions and prohibitions in. 
trade, 17. How this fyftem is delineated by M. Quefnai, 19. The 
bad efFecls of an injudicious political ceconomy, how corrected, 21. 
The capital error in this fyftem pointed out, ibid. 

Poll-taxes, origin of, under the feudal government, ii. lor. 

. why efteemed badges of flavery, iii. 309. The nature of, 

confidered, 327. 

Poor, hiltory of the laws made for the provifion of, in England,!. 212, 

Pope of Rome, the great power formerly afTumed by, iii. 213. His 
power how reduced, 218. Rapid progrefs of the reformation, 222. 

Population, riches and extreme poverty equally unfavqurable to, i. 
1 20. Is limited by the means of fubfiltence, 121. 2; 5. 

Porter, the proportion of malt ufed in the brewing of, iii. 363. 

Portugal, the cultivation of the country not advanced by its commerce, 
ii. 135. The value of gold and filver there, depreciated by pro- 
hibiting their exportation, 271. Tranflation of the commercial 
treaty concluded in 1703 with England, 325. A large ihare of the 
Portugalgold fentannually to England, 327. Motives thatledtothe 
difcovery of a paftage to the Ealt round iheCapeof Good Hope, 347. 
Lull: its manufactures by acquiring rich and fertile colonies, 432. 

Pofl-ojjice, a mercantile project well calculated for being managed by 

a government, iii, 243. 

Potatoes^ remarks on, as an article of food, i. 249. Culture, and 
great produce of, 250. The difficulty of preferving them the great 
obftacle to cultivating them for general diet, 251. 
Poverty, fometimes urges nations to inhuman cuitoms, i. 2. Is no 
check to the prod udlion of children, 119. Jiut very unfavourable 
to raifing them, 120. 

K K 3 Poultry, 



IN D E X. 

s 

Poultry, the caufc of their cheapnefs, i. 352. Is a more important 
article of rural oeconomy in France than in England, 353. 

Pragmatic fanc~lion in France, the object of, iii. 220. Is followed by 
the concordat, ibid. 

Preferments, ecclefialtical, the means by which a national clergy 
ought to be managed by the civil magiltrate, iii. 210. Alterations 
in the mode of elefting to them, 212. 220. 

Prejbyterian church government, the nature of, defcribed, iii. 229. 
Character of the clergy of, 230. 236. 

Prices, real and nominal, of commodities diftinguifhed, i. 49. Money 
price of goods explained, 70. Rent for land enters into the price 
of the greater part of all commodities, 75. The component parts 
of the prices cf goods explained, ibid. Natural and market prices 
diftinguifhcd, and how governed, 82. 132. Though raifed at firft by 
an increafe of demand, are always reduced byitin therefult,iii. 134. 

Primogeniture, origin and motive of che law of fucceflion by, under 
the feudal goveinment, ii. 83. Is contrary to the real interefts of 
families, 84. 

Princes, why not well calculated to manage mercantile projects for 
the fake of a revenue, iii. 244. 

Prodigality^ the natural tendency of, both to the individual and to 
the public, ii. 13. Prodigal men enemies to their country, 18. 

Produce of land and labour, the fource of all revenue, ii. 4. The 
value of, how tp l>e increafed, 22. 

ProffJ/brs in univei fuies, circu reliances which determine their merit, 
iii. 231. 

Profit, the various articles of gain that pafs under the common idea 
of, i. 80. An average rate of, in all countries, 82. Averages of, 
extremely difficult to afcertain, 134. Interclt of money the be& 
ilandardof, 135. The diminution of, a natural confluence of pro- 
fperity, 139, Clear and grofs profit, diftinguiihed, 146. I' 1 he 
r.ature of the higheft ordinary rate of, defined, 147. Double in- 
Bereft, deemed ia Great Britain a reafonable mercantile profit, 148. 
In thriving countries, low profit may com penfate the high wages of 
labour, 149. The operation of high prohis and high wages, com- 
pared, ibid. Compenfates inconvenienciep and difgrace, 154. Of 
ilodc, how affected, 170. Large profits mull be made from fmall 
capitals, 172. Why ?ood;> are cheaper in the metropolis than in 
country villages, 175. Great fortunes more frequently made by 
trade ia larc^ towns than in fmall ones, 174. Is naturaliy low in 
rich, and high in poor countries, 396. 

- how that of the different clafles ot traders is raifed, ii. 50. Pri- 
vate, the icle motive of employing capitals in any branch of bufi- 
nefs, 70. When raifed by monopolies, encourage luxury, 457. 

Proje8s 9 unfucxtiiful, in arts, injurious to a country, ii. 19. 

Property* paffionj which prompt mankind to the invafion of, iii. 73. 
Civil government neceflary for the produ&ion of, ibid. Wealth a 
pf authority, 75. 79. 



INDEX. 

how far the variations in the price of, affeft labour and in- 
duitry, i. 112. 126. 130. Whether cheaper in the metropolis, or 
in country villages, 173. The prices of, better regulated by com- 
petition than by law, 222. A rife in the prices of, muft be uni- 
form, to {hew that it proceeds from a depreciation of the value of 
filver, 379. 

Prow/ors, object of the ftatute of, in England, iii. 220. 

PruJ/ia, mode of affefTing the land-tax there, iii. 270. 

Public works and inftitutions, how to be maintained, iii. 92. Equity 
of tolls for pafTage over roads, bridges, and canals, 95. Why go- 
vernment ought not to have the management of turnpikes, 99, 
Nor of other public works, 105. 

a fervice Hill exacted in moft parts of Europe, ii. 96. 



Quakers of Pennfylvania, inference from their refolu lion to emanci- 
pate all their negro flaves, ii. 83. 

Quefnai, M. view of his agricultural fyftem of political ceconomy, 
iii. 19. His doctrine generally fubfcribed to, 29. 

Quito, populoufnefs of that city, ii. 363. 



Reformation, rapid progrefsof the doctrines of, in Germany, iii. 222. 
In Sweden and Switzerland, 223. In England and Scotland, 
224. Origin of the Lutheran and Calviniftic feels, 225. 

Regulated companies. See Companies. 

Religion, the object of inliruction in, iii. 192. Advantage the teachers 
or a new religion enjoy over thofe of one that is eiUblifhed, 193. 
Origin of perfecution for heretical opinions, iof. How the zeal of 
the inferior clergy of the church of Rome is kept alive, 195. 
Utility of ecclefuftical eitablifhments, 198. How united with the 
civil power, 199. 

Rent* referved, ought not to confift of money, i. 50. But of corn, 
51. Of land, constitutes a third part of the price of mod kinds of 
goods, i. 75. An average rate of, in all countries, and how regu- 
lated, 82. Makes the firft deduction from the produce of labour 
employed upon land, 98. The terms of, how adjured between, 
landlord and tenant, 223. Is fometimes demanded for what is al- 
together incapable of human improvement, 224. Is paid for, and 
produced by, land in aim oft all fttuations, 227. The genera) pro* 
portion paid for coal mines, 262. And metal mines, 264. Mines 
of precious ftones frequently yield no rent, 270. How paid in an- 
lient times, 284. Is raifed, either directly or indirectly, by every 
improvement in the circumftances of fociety, 392. Grofs and 
neat rent diilinguifhed, 424. 

K K 4 



INDEX. 

Rent, how raifed and paid under feudal government, ii. 8. Prefent 
average proportion of, compared with the produce of the land, ibid. 
of houfes diftinguilhed into two parts, Hi. 280. Difference be- 
tween rent of houfes, and rent of land, 284. Rent of a houfe the 
bed eflimate of a tenant's circumftances, ^85. 

Retainers, under the feudal fyftem of government, defcribed, ii. 119. 
How the connexion between them and their lords was broken, 125. 
Revenue, the original fources of, pointed out, i. 78. Of a country, 
of <vhat it confifts, 424. The neat revenue of a fociety diminifhed 
by fupporting a circulating (lock of money, 428. Money no part 
of revenue, 429. Is not to be computed in money, but in what 
money will purchafe, 431. 

* how produced, and how appropriated, in the firft inftance, 

ii. 4. Prod uce of land, Ibid. Produce of manufactures, 5. Muft 
always replace capital, ibid. The proportion between revenue 
and capital, regulates the proportion berween idlenefs and in. 
duftry, 12. Both the favings and the fpendings of, annually con^ 
fumed, 14. Of every fociety, equal to the exchangeable value of 
the whole produce of its induftry, j8i. Of the cuftoms, incrcafed 
by drawbacks, 259. 

. why government ought not to take the managementof turn- 

pike?, to derive a revenue from them, iii. 99. Public works of a 
local nature, always better maintained by provincial revenues, than 
by the general revenue of the Hate, 105. Theabufesin provincial 
re venues trifling, when com pared with thofe in the re venue of a great 
empire, 106. The greater the revenue of the church, the fmaller 
muftbe that of the ftate, 234. The revenue of the (late ought to be 
raifed proportionably from the whole fociety, 238, Local expences 
ought to be defrayed by a local revenue, 239. Inquiry into the 
iources of public revenue, 241. Of the republic of Hamburgh, 242. 
246. Whether the government of Britain could undertake the ma- 
nagement of the Bank, to derive a revenue from it, 243. The poft- 
office a mercantile project well calculated for being managed by go- 
vernment, ibid. Princes not well qualified to improve their fortunes 
by trade, 244. TheEngliih Eaft India Company good traders be- 
fore they became fovereigns, but each character now ipoils the other, 
345. Expedient of the government of Pennfylvania to raife money, 
246. Kent of land the moft permanent fund, 248. Feudal reve- 
nues, 249. Great Britain, 250. Revenue from land proportioned, 
not to the rent, but to the produce, 252. Reafons for felling the 
crown lands, 253. An improved land-tax fuggefted, 264. The 
nature and effcdlof tythes explained, 274. Why a revenue cannot 
be raifed in kind, 278. When raifed in money, how affected by 
different modes of valuation, ibid. A proportionable tax on houfes, 
the beil fource of revenue, 285. Remedies for the diminution of, 
according to their csufes, 354. Bad effects of farming out public 
revenues, 386. The different fources of revenue in France, 389. 
How expended, in the rude itate of fociety, 394. 
Rice, a very productive article of cultivation, i. 248. Requires a foil 

unfa 



INDEX. 

unfit for railing any other kind of food, 249. Rice countries more 
populous than corn countries, 321. 

Riches, the chief enjoyment of, confifts in the parade of, i. 269. 

/?//, inftances of the inattention mankind pay to it, i. 165. 

Reads, good, the public advantages of, i. 229. 

. how to be made and maintained, iii. 94.. The maintenance 

of, why improper to be trufted to private intereft, 97. General 
ftate of, in France, 102. In China, 103. 

Romans, why copper became the ftandard of value among them, i. 57. 
The extravagant prices paid by them for certain luxuries for the 
table, accounted for, 341. The value of filver higher among them 
than at the prefent time, ibid. 

the republic of, founded on a divifion of land among the 

citizens, ii. 344. The agrarian law only executed upon one or 
two occafions, 34^. How the citizens who had no land, fubfifted, 
ibid. DiftincYion between the Roman and Greek colonies, 346. 
The improvement of the former flower than that of the latter, 361. 
Origin of the focial war, 452. The republic ruined by extending 
the privilege of Roman citizens to the greater partof the inhabitants 
of Italy, 456. 

> when contributions were firft raifed to maintain thofe who 

went to the wars, iii. 49. Soldiers not a diftinct profeffion there, 
53. Improvement of the Roman armies by difcipline, 63. How 
that difcipline was loft, 64. The fall of the Weftern empire, how 
effected, 66. Remarks on the education of the ancient Romans* 
172. Their morals fuperior to thofe of the Greeks, 173. State 
of law and forms of ju (lice, 176. The martial fpirit of the people, 
how fupported, 188. Great reductions of the coin practifed by, at 
particular exigencies, 436, 

Rome, modern, how the zeal of the inferior clergy of, is kept alive, 
iii. 195. The clergy of, one great fpiritual army difperfed in dif- 
ferent quarters over Europe, 213. Their power during the feudal 
monkifh ages fimilar to that of the temporal barons, 214. Their 
power how reduced, 218. 
Rouen, why a town of great trade, ii. 10. 
Ruddiman, Mr. remarks on his account of the antient price of wheat 

in Scotland, i. 287. 
Rujfia was civilized under Peter I. by a (landing army, iii. 68. 



Sailort, why no fenfible inconvenience felt by the great numbers 

difbanded at the clofe of a war, ii. 204. 
Salt, account of foreign fait imported into Scotland, and of Scots 

fait delivered duty free, for the fifliery, ii. Append. Is an object 

of heavy taxation every where, iii. 337. The collection of the 

duty on, expenfive, 376. 
Sardinia, the land-tax how aflefTed there, iii. 272. 

Saxon 



I N D E X. 

lords, their authority and jurifdidion as great before the cor- 
queffcas thofe of the Normans were afterward, ii. 122. 

8f foals, parochial, obfervations on, iii. 187. 

Schttee is the great antidote to .the pcifon of enthufiafm and fuper- 
Uition, iii. 20 ), 

Sfi/ia, his Span ifti rn'ilitia, rendered fuperior to the Carthaginian 
militia by difcipline and fervice, iii. 63. 

Scet/anJ, compared wiih England, as to the prices of labour and 
provifior?, i. 114. Remarks on the population of the Highlands, 
izo. The market rate of intereft, higher than the legal ate, 137. 
Tbefituation of cottagers there, dcfcribed, 179. Apprenticeihi-ps 
and corpora H3ns, 187. The common people of, why neither fa 
flrong r,t>r ib hardfome as the Tame claft in England, 25 i. Caufe 
of the freque.it emigrations from, 297. Progrefs of agriculture 
there before the urjion with England, 346. Prefent obfliudions to 
better Husbandry, 34^. The price of wool reduced by the union, 
369. Operation of the feveral banking companies eftabiiihed there, 

442. Amount of the circulating money there before the union, 

443. Arr.ouru of the prefent circulating cafli, 444. Courfe of 
cal?r>gs in the Scots bank, ibid. Difficulties occafioned by thefe 
fc-arks ifTuing too much paper, 452. NecefTary caution for fome 
time bbiervpd by the banks in giving credit to their cuftomers, with 
the good eifefts of it, 4.56. 1'he Icherne of drawing and redrawing 
adppted by traders, ^63. Its pernicious tendency explained, 465. 
Kiitory of the Ayr bank, 471. JVir. Law's fcheme to improve the 
coB&try, 478. The prices of goods in, not altered by pape;r cur- 
rency, 490. EficCl of the optional claufes in their notes, 492.. 

caufe of the fpeedy eftabliiament cf the reformation" there, 

iii. 224. The diforders attending popular elections of the clergy 
t&ere> occafitm the right of patronage to be eflablifhed, 22^. 
Amount ot the whole revenue of the clergy, 235. 
Sea fervice and military fervice by land compared, i. 167. 

religion, the more numerous, the better for fociety, iii. zoo. 
Why they generally profess the auflere Ijitem ot morality, 204. 

the governing principle in theintercourfe of human fociety, 

J. 21. 

Set*vtintJ, menial, diftinguifhed from hired workmen, ii. i. The 
various orders of men, who rank in the former cia(s, in reference 
to their labours, 3. 

- -- their labour unproductive, iii. 22. 

poor, brief review of the Englifh laws relating to, 



i. 212. The remcvals of the poor, a violation of natural liberty, 
219. 

- the law of, ought to be repealed, ii. 205. 

?ffj>, frequently killed in Spain, for the fake of the fleece and the 
lailow, j. 361. 

ieverelvnvsagainll theexportationof them and their wool, 11.494. 
t war how iupported by a nation of, iii. 45. Inequality of 
among, the fcurce of great authority, 77. Birth and fa- 

mily 



INDEX. 

mily highly honoured in nations of fhepherds, 78. Inequality of 
fortune full began to take place in the age of fhepherds, 79. And 
introduced civil government, 80. 

Shetland, hew rents are eftimated and paid there, i. 224. 

Silk manufacture, how transferred from Lucca to Venice, ii. 1 13* 

Silver, the firlt (tandard coinage of the northern fubverters of the Ro- 
man erapiie, i. 58. Its proportional value to gold regulated by 
law, 59. Is the meafureof the value of gold, 60. Mint price of 
filver in England, 63. Inquiry into the difference between the 
mint and market prices of bullion, 6,f . How ro preferve the filver 
coin from being melted down for profit, 66. The mines of, in Eu- 
rope, why generally abandoned, 263. Evidences of thefmall profit 
they yield to proprietors in Peru, 264. Qualities for which this 
metal is valued, 269. The mcit abundant mines of, would add 
Jittleto the wealth of the world, 271. But the increafein the quan- 
tity of, would depreciate its own value, 275. Circumftances thac 
might counteract this effVcl, ibid. Hiflorical view of the variations 
in the value of, during the four lad centuries, 276. Remarks on 
its rife in value compared with corn, 282. Circumitances that have 
mifled writers in reviewing the value of filver, 284. Corn the befl 
itandard for judging of the real value of iilver, 293. Thepriccof, 
how affecled by the increafe of quantity, 294. The value of, funk 
by the difcovery 01 the American mines, 300. When the red uclon 
of its value from this caufe appears to have been completed, 301. 
Tax paid from the Peruvian mines to the king of Spain, 314. The 
value of filver kept up by an extenfion of the market, 315. Is the 
inoft profitable commodity that can be fcnt to China, 323. The 
value of, how proportioned to that of gold, before and after the 
difcovery of the American mines, 330. The quantity commonly 
in the market in proportion to that of gold, probably greater than 
their relative values indicate, 332. The value of, probably rifing, 
and why, 336. The opinion of a depreciation of its value, not 
well founded, 380. 

the real value of, degraded by the bounty on the exportation 

of corn, ii. 268. 

Sinking fund in the Britifti finances, explained, iii. 410. Is inadequate 
to the difcharge of former debts, and almoftwholly applied toother 
purpofes, 418. Motives to the mifapplication of it, 419. 

Staves, the labour of, dearer to the matters than that of freemen,!. 122. 
under feudal lords, circunWlances of their fiiuation, ii. 87. 
Countries where this order of men Uill remains, 89. Why the ft r- 
vice of ilaves is preferred to that of freemen, 89. Their labour 
why unprofitable, 90. Caules of the abolishing of flavery 
throughout the greater part of Europe, 91. Receive more pro- 
teclion from the magiftrate in an arbitrary government, than in 
one that is free, 395. 

- why employed in manufactures by the amient Grecians, 

iii. 36. Why no improvements arc to be expecled from them, 37. 

Smuggling, a tempting, but generally a ruinous employment, i. 170. 

Smuggling 



INDEX. 

Juggling encouraged by high duties, iii. 350. Remedied againft, 
354. The crime of, morally confidered, 378, 

Society, human, the firft principles of, i. 21. 

Soldiers, remarks on their motives for engaging In the military line, 
i. 167. Comparifon between "the land and fea fervice, ibid, 

* why no fenfible inconvenience felt by the difbanding of great 

numbers after a war is over, ii. 204. 

- reafon of their firft ferving for pay, iii. 50. How they be- 
came a diflinct clafs of the people, 55. How diftinguifhed from 
the militia, 56. Alteration in their exercife produced by the in- 
verftion of fire-arms, 57. 

South-Sea Company, amazing capital Once enjoyed by, iii. 124. Mer- 
cantile and flock-jobbing projects of, 128. Affiento contract, 129. 
Whale-rimery, ibid. The capital of, turned into annuity dock,. 
130. 407. 

Sovereign and trader, inconfiftent characters, iii. 245. 

Sovereign, three duties only^, neceffary for him to attend to, for fup- 
jporting a fyflem of natural liberty, iii. 42. How he is to protect 
the fociety from external violence, 44. 70, And the members of 
it, from the injuftice and oppreffion of each other, 72. And to 
maintain public works and inftitutions, 92. 

Spain, one of the pooreft countries in Europe, notwithftanding its 
rich mines, i. 377. 

its commerce has produced no confiderable manufactures for 

diftant Tale, and thegreater part of thecountry remains uncultivated, 
ii. 135. Spanifh modeof eilimating their American difcoveries, 140. 
The value of gold and filver there, depreciated by laying a tax on 
the exportation of them, 271. Agriculture and manufactures there, 
difcouraged by the redundancy of gold and filver, 272. Natural 
confequences that would refult from taking away this tax, 273. 
The real and pretended motives of the Court of Caftile for taking 
})offeflion of the countries difcovered by Columbus, 352. The tax 
on gold and filver, how reduced 353. Gold, the object of all the 
enterprifes to the new world, 354. The colonies of, lefs populous 
than thofe of any other European nation, 363. AfTerted an cx- 
clufive claim to all America, until the mifcarriage of their invin- 
cible armada, 366. Policy of the trade with the colonies, 377. 
The American eltablilhments of, effected by private adventurers, 
who received little beyond permiffion from the government, 398. 
Loft its manufactures by acquiring rich and fertile colonies, 432. 
The alcavala tax there ex[ lained, 381. The ruin of the Spanifh 
manufactures attributed to it, 382. 

Speculation, a diftinct employment in improved fociety, i, 16. Spe- 
culative merchants defcri-bed, 175. 

Stage, public performers on, paid for the contempt attending their 
profefiion, i. 163. 

the political ufe of dramatic reprefentations, iii. 206. 

Stamp duties in England and Holland, remarks on, iii, 316. 321." 
tenants in Scotland, what, ii. 92. 

9 Stoct, 



I N D E X. 

the profits raifed on, in manufactures, explained, I. 72. In 
trade, an increafe of, raifes wages, and diminifhes profit, 133. 
Muft be larger in a great towji than in a country village, 1 36. Na- 
tural confequeoces of a deficiency of fleck in new colonies, 140. 
The profits on, little afft&ed by theeafitvefs or difficulty of learning 
a trade, 156. But by the rife, or difagreeablenefs of the bufinefs, 
170. Stock employed for prcfit, fets into motion the greater part 
of ufeful labour, 396. No accumulation of, neceffary in the rude 
flate of fociety, 407. The accumulation of, neceffary to thedivi- 
fion of labour, 408. Stock diftinguifhed into two parts, 411. The 
general flock of a country or fociety, explained, 414. Houfes, ibid. 
Improved land, 416. Perfonal abilitie?, 417. Money and provi- 
fions, ibid. Raw materials and manufactured goods, 418. Stock 
of individuals, how employed, 421. Is frequently buried or con- 
cealed, in arbitrary countries, 422. 

the profits on, decreafe, in proportion as the quantity increases, 
ii. 9. On what principles flock is lent and borrowed at intereft, 33. 
That of every fociety divided among different employments, in the 
proportion moft agreeable to the public intereft, by the private 
views of individuals, 466. The natural diflribution of, deranged 
by monopolizing fyitems. 468. Every derangement of, injurious 
to the fociety, 470. 

mercantile, is barren and unproductive, according to the French 

agricultural fyftera of political oeconomy, Hi. 8. How far the re- 
venue from, is an object of taxation, 292. A tax on, intended 
under the land-tax, 296. 
Stockings, why cheaply manufactured in Scotland, i. 181. When fir ft 

introduced into England, 389. 

Stone quarries, their value depends on fituation, i. 254. 274. 
Stones, precious, of no ufe but for ornament, and how the price ofV 
is regulated, i. 270. The molt abundant mines of, would add 
little to the wealth of the world, 271. 

Subordination, how introduced into fociety, iii. 74. Perfonal quali- 
fications, ibid. Age and fortune, 75. Birth, 77. Birth and for- 
tune two great fources of perfonal diftinCtion, 78. 
Suljidy, old, in the Englifh cufloms, the drawbacks upon, ii. 253* 

Origin and import of the term, iii. 347. 
Sugar, a very profitable article of cultivation, i. 243. ii, 89. 

1 ' Drawbacks on the exportation of, from England, ii. 254. 
Might be cultivated by the drill, plough, inftead of all hand labour 
by flaves, 394. 

a proper fubjedt for taxation, as an article fold at monopoly 

price, iii. 370. 

Sumptuary laws fuperfluous reftraints on the common people, ii. 27. 
Surinam, prefent flate of the Dutch colony there, ii. 367. 
Sivjfzer/ard, eflablifhment of the reformation in Berne and Zurich, 
iii. 223. The clergy there zealous and induftrious, 236. Taxei 
how paid there, 299, 315. 

fait/*, 



I N D E X. 



Yaitt*, in France, the nature of that tax, ind its operation, ex- 
plained, ii. 96. iii. 303. 

Talents^ natural, not fo various in different men as is foppofed, i. 23. 

Tartars, their manner of concluding war, iii. 45. Their invafions 
dreadful, 47. 

Taverttier, his account of the diamond mines of Golconda and Vi- 
fiapour, i. 270. 

Vaxts, the origin of, under the feudal government, ii. 101. 

_ the fources from whence they mud arile, iii. 255. Unequal 
taxes, 256. Ought to be clear and certain, ibid. Ought to be 
levied at the times moil convenient for payment, 257. Ought to 
take as little as pcfiible out of the pockets of the people, more 
than is brought into the public treafury, ibid. How they may be 
made more burdenfome to the people than beneficial to the fove- 
reign, ibid. The land-tax of Great Britain, 259. Land-tax at 
Venice, 263. Improvements fuggefted for a land-tax, 264. Mode 
of afleffing the land-tax in Pruflia, 270. Tythes a very unequal 
tax, and adifcouragement to improvement, 274* Operation of tax 
on houfe rent, payable by the tenant, 281. A proportionable tax 
on houfes, the beft fource of revenue, 285. How far the revenue 
from (lock is a proper object of taxation, 292. Whether intereft of 
cnoney is proper for taxation, 294. How taxes are paid at Ham- 
burgh, 298. In Switzerland, 299. Taxes upon particular em- 
ployments, 301. Poll-taxes, 309. Taxes, badges of liberty, ibid. 
Taxes upon the transfer of property, 312, Stamp duties, 316. 
On whom the feveral kinds of taxes principally fall, 317- Taxes 
upon the wages of labour, 321. Capitations, 327. Taxes upon 
confumable commodities, 331. Upon r.ece/Taries, 333. Upon 
luxuries, 334. Principal neceflaries taxed, 337. Abfurdities in 
taxation, 339. Different parts of Europe very highly taxed, 340. 

. Two different methods of taxing confumable commodities, 341. 
Sir Mathew Decker's fcheme of taxation confidered, 342. Excife 
and cufloms, 345. Taxation fometimes not an inftrumentof reve- 
nue, but of monopoly, 350. Improvements of the cufloms fug- 
gefted, 353. Taxes paid in the price of a commodity little adverted 
to, 374. On luxuries, the g^^od and bad properties of, ibid. 
Bad effects of farming them out, 386. How the finances of France 
might be reformed, 390. French and Engliih fyftems of taxation 
compared, 391. New taxes always generaudifeontent, 419. How 
far the Britifh fyftem of taxation might be applicable to all the dif- 
ferent provinces of the empire, 441. Such apian might fpeedily 
difcharge the national debt, 448, 

TVfl, great importation and confumption of thatdrug in Britain, 1.320. 

Teachers in univerfities, tendency of endowments todiminifh their ap- 
plication, iii. 152. The jurifd&iions to which they are fubjeft, 

little 



I N D E X. 

ftttfe calculated to quicken their diligence, 153. Are 
obliged ro gain protection by fervility, 154. Defects in their ctfa- 
blifhmenrs, i 56. Teachers among the antient Greeks and Romans, 
Aiperiorto riiofeof modern times, 170. CircumiUnces which draw 
good ones to, or drain them from, the 1 universes, 231. Their 
employment naturally renders them eminent in letters, 233. 
Tenures, feudal, general obfervanons on, ii. 7. Deiciibed, 8z 
Theology, monkilh, the complexion of, iii. 168. 
Tin, average rent of the mines fit\ in Cornwall, i. 264, YleJI 3 
greater profit to the proprietors than the fllver mines of Peru * 265, 
Regulations under which tin -mines are worked, 266. 
Tobacco, the culture of, why rettrained in Europe, i. 245. Notfo 
profitable an article of cultivation in the Weft Indies as fttgar, 246. 
the amount and courfe of the Britifh trade with, explained, 

ii. 68. The whole duty upon, drawn back on exportation, 25,4. 
Confequences of the exclufue trade Britain enjoys with Mary- 
land and Virginia in this article, 407. 

Tells, forpaffage over road?, bridges, and navigable canals, the eqtaity 
of, (hewn, iii. 95. Upon carriages of luxury, ought to be higher 
than upon carriages of utility, 96. The management of turnpikes 
often an objed of juil complaint, 98. Why government ought 
not to have the management of turnpikes, 99. 371. 
Tonnage and poundage, origin of thofe duties, iii. 346. 
Tontine in the French finances, what, with the derivation of the 

name, iii. 413. 
Tculoufe, falary paid to a counfel'or pr judge in the parliament of, 

iii. 87. 

Towns, the places where induftrv j. mod profitably exerted, i. 194, 
tt The fpirit of comb: nation prevalent among man ufa&urers, 195,200. 
. ' ' according to what circumitances the general chara&er of the 
inhabitant?, as to induftry, is formed, ii. io The reciprocal ra- 
mre of the trace bet-ween them and the conntry, explained, 73. 
Sobiift on the furplus produce of the country, 75. How firft 
formed, 77. Are continual fairs, ibid. The original poverty and 
fervile Jtate of the inhabitants of, 100. Their early exemption* 
and privileges, how obtained, 101. The inhabit. nt> of, obtained 
liberty much earlier than the occupiers of land in the country, 102. 
Origin of free burghs, ibid* Origin of corporations, 103. Wfcy 
allowed to form militia, 107. How the increafe and riches of com- 
mercial towns contributed to the improvement of the countries to 
which they belonged, 1 17. 
Trade, double interred deemed areafonable mercantile profit in, 1.148. 

four general clafles of, equally neceffary to, and dependent 

on, each other, ii. 46. Wholefale, three different forts of, 59. 
Tne different returns of home and foreign trade, 61. The nature 
and operation of the carrying trade examined, 64. The principle* 
of foreign trade examined, 67. The trade between town and coun- 
try explained, 73. Original poverty and fervile ftate of the inha- 
bitants of towns, under feudal government, ico. Exemptions and 

privilege* 



INDEX. 

privileges granted to them, ior. Extenfion of commerce by rude 
nations felling their own raw produce for the manufactures of mere 
civilized ce^ntries, 1 1 1. Its falutary effects on the government and 
manners of a country, 1 19. Subverted the feudal authority, 123. 
The independence of tradefmen and artifans, explained, 127. The 
capitals acquired by, very precarious, until fome part has been re- 
alized by the cultivation and improvement of lard, 136. Over- 
trading, the caufe of complaints of the fcarcity of mor.ey, 152* 
The importation of gold and filver not the principal benefit derived 
from foreign trade, 167. Effect produced in trade and manufactures 
by the difcovery of America, 169. And by the difcovery of a paf- 
fage to the Eaft Indies round the Cape of Good Hope, 170. Error 
of commercial writers in eftimating national wealth by gold and fil- 
ver, 172. Inquiry into the caufe and effect of reitraints upon trade, 
173. Individual, by purfuing their own intereft, unknowingly 
promote that of the public, 181. Legal regulations of trade, un- 
fafe, 182. Retaliatory regulations between nations, 200. Meafures 
for laying trade open, ought to be carried into execution flowly, 
207. Policy of the reftraints on trade between France and Bri- 
tain confidered, 211. No certain criterion to determine on which 
fide the balance oftrece between two countries turns, 212. Moft 
of the regulations of, founded on a miftaken doctrine of the ba- 
lance of trade, 235. Is generally founded on narrow principles of 
policy, 243- Drawbacksof duties, 252. The dealer who employs 
his whole ftock in one fingle branch of bufinefs, has an advan- 
tage of'the fame kind with the workman who employs his whole 
labour on a fingle operation, 302. Confequences of drawing it 
from a number of fmall channels into one great channel, 424*. 
Colony trade, and the monopoly of that trade, diftinguiflied, 429. 
The intereft of the confumer conltantly facrificed to that of the 
producer, 515. 

yVW*, advantages attending a perfect freedom of, to landed nations, 
according to the prefent agricultural fyftem of political ceconomy 
in France, iii. i c. Origin of foreign trade, 16. Confequences of 
high duties and prohibitions, in landed nations, 17. 19. How 
trade augments the revenue of a country, 26. Nature of the trad- 
ing intercourfe between the inhabitants of towns and thofe of the 
country, 40. 

trades, caufe and effect of the feparation of, i. 9. Origin of, 22. 

Tranfit duties explained, iii, 372. 

travelling for education, fummary view of the effects of, iii. 171. 

Treafures, why formerly accumulated by princes, n. 166. 

Treafure trove, the term explained, i. 422. Why an important 
branch of revenue under the antient feudal governments, iii* 396. 

Turkey Company, ihort hiitorical view of, iii. 1 13, 

Turnpikes. See Tolls. 

fykes, why an unequal tax, iii. 274. The levying of, a great dif- 
couragement to improvements, 275. The fixing a modus for, a 
relief to the farmer, 279. 

Value* 



I N D E X. 



lvalue, the term defined, i. 42. 

Vedius PoIIio, his cruelty to his (laves checked by the Roman emperor 
Augultus, which could not have been done under the republican 
form of government, ii. 396. 

Venice, origin of the filk manufacture in that city, ii. 113. Traded 
in Eaft India goods before the fea track round the C^pe of Good 
Hope was difcovered, 347. 

nature of the land-tax in that republic, Hi, 263. 

Veni/on, the price cf, in Britain, does not compenfate the expenteof 
a deer park, i. 551. 

Vicefima hayeditat'um among the antient Romans, the nature of, ex- 
plained, in. 312. 

Villages, how firfl formed, ii. 77. 

FilknagCt probable^caufe of the wearing out of that tenure in Eu- 
rope, ii. 91. 

Vineyard, the moil prcfirable part of agriculture, both among the an- 
tients and moderns, i. 239. Great advantages derived from pe- 
culiarities of foil in, 242. 

Uni<verjjties, the emoluments of the teachers in, how far calculated to 
promote their diligence, iii. 152. The profcfTors at Oxford have 
moflly given up teirhing, 153. Thofe in France fubjeft to in- 
competent jurifdi&icns, 155. The privileges of graduates im- 
properly obtained, ilid. Abufe of leftoreftiips, 156. The dif- 
cipline of, feldom calculated for the benefit of the Itudents, 157. 
Are, in England, more corrupted than the public fchools, 159. 
Original foundation of, 160. How Latin became an effential ar- 
ticle in academical education, 161. How the ftudy of the Greek 
language was introduced, 162. The three great branches of the 
Grt-ck philofophy, 163. Are nowdividcd into five branches 166. 
The monkifti courfe of education in, 168. Have not been very 
ready to adopt improvements, 169. Are not well calculated to 
prepare men for the world, 170. How filled with good pro feflbrs 
or drained of them, 231. Where the word and brll profeiTors are 
generally to be met with, 232. See Colleges and Teachers. 



W 

Wages of labour how fettled between mailers and workmen, i. 99. 
The workmen generally obliged to comply with the terms of thrtr 
employers, 100. The oppofition of workmen outrageous, and Jcl- 
dorn fuccefsful, 101. Circumftnnces which operate toraife wagc.% 
103. The extent of wages limited by the funds from which they 
arife, 104. Why higher in North America, than in England, 105. 
Are low in countries thatar? fbtionary, 107, Not oppreflivcly low 
in Great Britain, 1 1 1 . A diflinclion made here between the wages 
in fummer and in winter, ibid. If fufficient in dear ye*rs, they mull 
be ample in feafons of plenty, 1 12. Different rates of, in different 
VOL. in. . L L places, 



f N D E X. 

places, 113. Liberal wages encourage induftry and propagation, 
124. An advance of, neceflanly raifes the price of many commo- 
dities, 132. An average of, not eafily afcertained, 134. The 
operation of hig-h wages and high profits compared, 149. Caufes 
of the variations of, in different employments, 152. Are generally 
higher in new, than in old trades, 176. 210. Legal regulations of, 
deftroy induftry and ingenuity, 220. 
Wages, natural effect of a dired tax upon, iii. 322. 
Walpole, Sir Robert, his excife fcheme defended, iii. 358. 
Wants of mankind, how fupplied through the operation of labo.ur, i. 
33. How extended, in proportion to their fupply, i, 256. The 
far greater part of them fupplied from the produce of other men's 
labour, 407. 

Wars, foreign, the funds for the maintenance of, in the prefent cen- 
tury, have little dependence on the quantity of gold and lilver in a 
nation, ii. 1^9. 

. how fupported by a nation of hunters, iii. 44. By a nation of 

fhepherds, 45. By a nation of hufbandmen, 47. Men of military 
age, what proportion they bear to the whole fociety, 48. Feudal 
wars, how fupported, 49. Caufes which in the advanced ftateof 
fociety rendered it impoffible for thofe who took the field, to main- 
tain themfelves, 50. How the art of war became a diftinctprofeffion, 
53. Distinction between the militia and regular forces, 56. Al- 
teration in the art of war produced by the invention of fire-arms, 
57. 70. Importance of difcipline, 59. Macedonian army, 61. 
Carthagenian army, 62. Roman army, 63. Feudal armies, 66. 
A well regulated Handing army, the only defence of a civHized 
country, and the only means for fpeedily civilizing a barbarous 
country, 68, The want of parfimony during peace, impofes on 
ftates the necefiity of contracting debts to carry on war, 399. 416. 
Why war is agreeable to thofe who live fecure from the immediate 
calamities of it, 417. Advantages of raifing the fupplies for, 
within the year, 427. 

Watch movements, great redaction in the prices of, owing to me- 
chanical improvements, i. 385. 
Wealth and money, fynonymous terms, in popular language, ii. 139. 

172. Spanifh and Tartarian eftimate of, compared, 140. 
the great authority conferred by the po/Teffion of, iii. 75. 
Weavers, the profits of, why neceffarily greater than thofe of fpin- 

ners, i. 77. 

Weft Indies, difcovered by Columbus, ii. 349. How they obtained 
this name, ibid. The original native productions of, 350. The 
thirft of gold the object of all the Spanifh enterprifes there, 354. 
And of thofe of every other European nation, 357. The remote- 
nefs of, greatly in favour of the European colonies there, 362. The 
fugar colonies of France better governed than thofe of Britain, 

Wheat. See Corn. 

Window tax in Britain, how rated, iii. 290. Tends to reduce houfe- 
rent, 2.92. 

Wind/or 



INDEX. 

Windfor market, chronological table of the prices of corn at, i. 403. 

Wine* the cheapnefs of, would be a caufe of fobriety, ii. 242. The 
carrying trade in, encouraged by Englifh ( ftatutes, 255. 

Wood) the price of, rifes in proportion is a country is cultivated, i. 
259. The growth of young trees prevented by cattle, 260. When 
the planting of trees becomes a profitable employment, it. 

Wool, the produce of rude countries, commonly carried to a diflant 
market, i. 360. The price of, in England, has fallen confiderably 
fince the time of Edward III. 363. Caufes of this diminution in 
price, 364. The price of, confiderably reduced in Scotland, by 
the union with England, 369. 

Severity of the laws againft the exportation of, ii, 495. Re- 
ftraints upon the inland commerce of, 497. Reltraints upon the 
coafting trade of, 498. Pleas on which thefe reftraints are founded, 
499. The price of wool depreffcd by thefe regulations, 500. The 
exportation of, ought to be allowed, fubject to a duty, 504. 

Woollen cloth, the prefent prices of, compared with thofe at the clpie 
of the fifteenth century, i. 386. Three mechanical improvements 
introduced in the manufacture of, 389. 



FINIS, 



Puttifhed ly the fame AUTHOR. 

I. The THEORY of MORAL SENTIMENTS : An Effky towards 
an Analyfis of the Principles by which Men naturally judge 
concerning the Conduct and Character, firft of their Neigh- 
bours, and after wards of themfelves. To which is added, A 
DISSERTATION on the ORIGIN of LANGUAGE. A New 
Edition, being the Seventh, with very confiderable Additions 
and Corre&idns $ elegantly printed in Two Volumes, 
O&avo, Price 145. in Boards. 

It. ESSAYS on PHILOSOPHICAL, SUBJECTS ; by the late Adam 
Smith, LL. D. F. R. S. E. &c. With an Account of his Life 
and Writings 5 by Dugald Stewart, F. R. S. E. 4to. Price 
155. in Boards. 



I 



PLEASE DO NOT REMOVE 
CARDS OR SLIPS FROM THIS POCKET 

UNIVERSITY OF TORONTO LIBRARY 



HB Smith, Adam 

161 An inquiry into the nature 

365 and causes of the wealth of 

1799 nations 

v.3