PART III.--Of the variations in the Proportion between the respective
Values of that sort of Produce which always affords Rent, and of that
which sometimes does, and sometimes does not, afford Rent.

The increasing abundance of food, in consequence of the increasing
improvement and cultivation, must necessarily increase the demand for
every part of the produce of land which is not food, and which can
be applied either to use or to ornament. In the whole progress of
improvement, it might, therefore, be expected there should be only one
variation in the comparative values of those two different sorts of
produce. The value of that sort which sometimes does, and sometimes
does not afford rent, should constantly rise in proportion to that which
always affords some rent. As art and industry advance, the materials of
clothing and lodging, the useful fossils and materials of the earth,
the precious metals and the precious stones, should gradually come to be
more and more in demand, should gradually exchange for a greater and a
greater quantity of food; or, in other words, should gradually become
dearer and dearer. This, accordingly, has been the case with most of
these things upon most occasions, and would have been the case with all
of them upon all occasions, if particular accidents had not, upon some
occasions, increased the supply of some of them in a still greater
proportion than the demand.

The value of a free-stone quarry, for example, will necessarily increase
with the increasing improvement and population of the country round
about it, especially if it should be the only one in the neighbourhood.
But the value of a silver mine, even though there should not be another
within a thousand miles of it, will not necessarily increase with the
improvement of the country in which it is situated. The market for the
produce of a free-stone quarry can seldom extend more than a few miles
round about it, and the demand must generally be in proportion to the
improvement and population of that small district; but the market for
the produce of a silver mine may extend over the whole known world.
Unless the world in general, therefore, be advancing in improvement and
population, the demand for silver might not be at all increased by the
improvement even of a large country in the neighbourhood of the mine.
Even though the world in general were improving, yet if, in the course
of its improvements, new mines should be discovered, much more fertile
than any which had been known before, though the demand for silver would
necessarily increase, yet the supply might increase in so much a greater
proportion, that the real price of that metal might gradually fall;
that is, any given quantity, a pound weight of it, for example, might
gradually purchase or command a smaller and a smaller quantity of
labour, or exchange for a smaller and a smaller quantity of corn, the
principal part of the subsistence of the labourer.

The great market for silver is the commercial and civilized part of the
world.

If, by the general progress of improvement, the demand of this market
should increase, while, at the same time, the supply did not increase
in the same proportion, the value of silver would gradually rise in
proportion to that of corn. Any given quantity of silver would exchange
for a greater and a greater quantity of corn; or, in other words, the
average money price of corn would gradually become cheaper and cheaper.

If, on the contrary, the supply, by some accident, should increase, for
many years together, in a greater proportion than the demand, that metal
would gradually become cheaper and cheaper; or, in other words, the
average money price of corn would, in spite of all improvements,
gradually become dearer and dearer.

But if, on the other hand, the supply of that metal should increase
nearly in the same proportion as the demand, it would continue to
purchase or exchange for nearly the same quantity of corn; and the
average money price of corn would, in spite of all improvements.
continue very nearly the same.

These three seem to exhaust all the possible combinations of events
which can happen in the progress of improvement; and during the course
of the four centuries preceding the present, if we may judge by what has
happened both in France and Great Britain, each of those three different
combinations seems to have taken place in the European market, and
nearly in the same order, too, in which I have here set them down.

Digression concerning the Variations in the value of Silver during the
Course of the Four last Centuries.

First Period.--In 1350, and for some time before, the average price of
the quarter of wheat in England seems not to have been estimated
lower than four ounces of silver, Tower weight, equal to about twenty
shillings of our present money. From this price it seems to have fallen
gradually to two ounces of silver, equal to about ten shillings of our
present money, the price at which we find it estimated in the beginning
of the sixteenth century, and at which it seems to have continued to be
estimated till about 1570.

In 1350, being the 25th of Edward III. was enacted what is called
the Statute of Labourers. In the preamble, it complains much of the
insolence of servants, who endeavoured to raise their wages upon their
masters. It therefore ordains, that all servants and labourers should,
for the future, be contented with the same wages and liveries (liveries
in those times signified not only clothes, but provisions) which they
had been accustomed to receive in the 20th year of the king, and the
four preceding years; that, upon this account, their livery-wheat should
nowhere be estimated higher than tenpence a-bushel, and that it should
always be in the option of the master to deliver them either the wheat
or the money. Tenpence: a-bushel, therefore, had, in the 25th of Edward
III. been reckoned a very moderate price of wheat, since it required a
particular statute to oblige servants to accept of it in exchange for
their usual livery of provisions; and it had been reckoned a reasonable
price ten years before that, or in the 16th year of the king, the
term to which the statute refers. But in the 16th year of Edward III.
tenpence contained about half an ounce of silver, Tower weight, and
was nearly equal to half-a-crown of our present money. Four ounces of
silver, Tower weight, therefore, equal to six shillings and eightpence
of the money of those times, and to near twenty shillings of that of
the present, must have been reckoned a moderate price for the quarter of
eight bushels.

This statute is surely a better evidence of what was reckoned, in those
times, a moderate price of grain, than the prices of some particular
years, which have generally been recorded by historians and other
writers, on account of their extraordinary dearness or cheapness, and
from which, therefore, it is difficult to form any judgment concerning
what may have been the ordinary price. There are, besides, other reasons
for believing that, in the beginning of the fourteenth century, and
for some time before, the common price of wheat was not less than four
ounces of silver the quarter, and that of other grain in proportion.

In 1309, Ralph de Born, prior of St Augustine's, Canterbury, gave a
feast upon his installation-day, of which William Thorn has preserved,
not only the bill of fare, but the prices of many particulars. In that
feast were consumed, 1st, fifty-three quarters of wheat, which cost
nineteen pounds, or seven shillings, and twopence a-quarter, equal to
about one-and-twenty shillings and sixpence of our present money; 2dly,
fifty-eight quarters of malt, which cost seventeen pounds ten shillings,
or six shillings a-quarter, equal to about eighteen shillings of our
present money; 3dly, twenty quarters of oats, which cost four pounds, or
four shillings a-quarter, equal to about twelve shillings of our present
money. The prices of malt and oats seem here to lie higher than their
ordinary proportion to the price of wheat.

These prices are not recorded, on account of their extraordinary
dearness or cheapness, but are mentioned accidentally, as the prices
actually paid for large quantities of grain consumed at a feast, which
was famous for its magnificence.

In 1262, being the 51st of Henry III. was revived an ancient statute,
called the assize of bread and ale, which, the king says in the
preamble, had been made in the times of his progenitors, some time kings
of England. It is probably, therefore, as old at least as the time of
his grandfather, Henry II. and may have been as old as the Conquest. It
regulates the price of bread according as the prices of wheat may happen
to be, from one shilling to twenty shillings the quarter of the money of
those times. But statutes of this kind are generally presumed to provide
with equal care for all deviations from the middle price, for those
below it, as well as for those above it. Ten shillings, therefore,
containing six ounces of silver, Tower weight, and equal to about thirty
shillings of our present money, must, upon this supposition, have been
reckoned the middle price of the quarter of wheat when this statute was
first enacted, and must have continued to be so in the 51st of Henry
III. We cannot, therefore, be very wrong in supposing that the middle
price was not less than one-third of the highest price at which
this statute regulates the price of bread, or than six shillings and
eightpence of the money of those times, containing four ounces of
silver, Tower weight.

From these different facts, therefore, we seem to have some reason to
conclude that, about the middle of the fourteenth century, and for a
considerable time before, the average or ordinary price of the quarter
of wheat was not supposed to be less than four ounces of silver, Tower
weight.

From about the middle of the fourteenth to the beginning of the
sixteenth century, what was reckoned the reasonable and moderate, that
is, the ordinary or average price of wheat, seems to have sunk gradually
to about one half of this price; so as at last to have fallen to about
two ounces of silver, Tower weight, equal to about ten shillings of our
present money. It continued to be estimated at this price till about
1570.

In the household book of Henry, the fifth earl of Northumberland, drawn
up in 1512 there are two different estimations of wheat. In one of them
it is computed at six shilling and eightpence the quarter, in the
other at five shillings and eightpence only. In 1512, six shillings and
eightpence contained only two ounces of silver, Tower weight, and were
equal to about ten shillings of our present money.

From the 25th of Edward III. to the beginning of the reign of Elizabeth,
during the space of more than two hundred years, six shillings and
eightpence, it appears from several different statutes, had continued
to be considered as what is called the moderate and reasonable, that is,
the ordinary or average price of wheat. The quantity of silver, however,
contained in that nominal sum was, during the course of this period,
continually diminishing in consequence of some alterations which were
made in the coin. But the increase of the value of silver had, it seems,
so far compensated the diminution of the quantity of it contained in the
same nominal sum, that the legislature did not think it worth while to
attend to this circumstance.

Thus, in 1436, it was enacted, that wheat might be exported without a
licence when the price was so low as six shillings and eightpence: and
in 1463, it was enacted, that no wheat should be imported if the price
was not above six shillings and eightpence the quarter: The legislature
had imagined, that when the price was so low, there could be no
inconveniency in exportation, but that when it rose higher, it
became prudent to allow of importation. Six shillings and eightpence,
therefore, containing about the same quantity of silver as thirteen
shillings and fourpence of our present money (one-third part less than
the same nominal sum contained in the time of Edward III), had, in those
times, been considered as what is called the moderate and reasonable
price of wheat.

In 1554, by the 1st and 2nd of Philip and Mary, and in 1558, by the
1st of Elizabeth, the exportation of wheat was in the same manner
prohibited, whenever the price of the quarter should exceed six
shillings and eightpence, which did not then contain two penny worth
more silver than the same nominal sum does at present. But it had soon
been found, that to restrain the exportation of wheat till the price
was so very low, was, in reality, to prohibit it altogether. In 1562,
therefore, by the 5th of Elizabeth, the exportation of wheat was allowed
from certain ports, whenever the price of the quarter should not exceed
ten shillings, containing nearly the same quantity of silver as the like
nominal sum does at present. This price had at this time, therefore,
been considered as what is called the moderate and reasonable price of
wheat. It agrees nearly with the estimation of the Northumberland book
in 1512.

That in France the average price of grain was, in the same manner,
much lower in the end of the fifteenth and beginning of the sixteenth
century, than in the two centuries preceding, has been observed both
by Mr Dupré de St Maur, and by the elegant author of the Essay on the
Policy of Grain. Its price, during the same period, had probably sunk in
the same manner through the greater part of Europe.

This rise in the value of silver, in proportion to that of corn, may
either have been owing altogether to the increase of the demand for that
metal, in consequence of increasing improvement and cultivation, the
supply, in the mean time, continuing the same as before; or, the demand
continuing the same as before, it may have been owing altogether to the
gradual diminution of the supply: the greater part of the mines which
were then known in the world being much exhausted, and, consequently,
the expense of working them much increased; or it may have been owing
partly to the one, and partly to the other of those two circumstances.
In the end of the fifteenth and beginning of the sixteenth centuries,
the greater part of Europe was approaching towards a more settled from
of government than it had enjoyed for several ages before. The increase
of security would naturally increase industry and improvement; and the
demand for the precious metals, as well as for every other luxury
and ornament, would naturally increase with the increase of riches.
A greater annual produce would require a greater quantity of coin
to circulate it; and a greater number of rich people would require a
greater quantity of plate and other ornaments of silver. It is natural
to suppose, too, that the greater part of the mines which then supplied
the European market with silver might be a good deal exhausted, and have
become more expensive in the working. They had been wrought, many of
them, from the time of the Romans.

It has been the opinion, however, of the greater part of those who have
written upon the prices of commodities in ancient times, that, from the
Conquest, perhaps from the invasion of Julius Caesar, till the
discovery of the mines of America, the value of silver was continually
diminishing. This opinion they seem to have been led into, partly by
the observations which they had occasion to make upon the prices both of
corn and of some other parts of the rude produce of land, and partly by
the popular notion, that as the quantity of silver naturally increases
in every country with the increase of wealth, so its value diminishes as
it quantity increases.

In their observations upon the prices of corn, three different
circumstances seem frequently to have misled them.

First, in ancient times, almost all rents were paid in kind; in a
certain quantity of corn, cattle, poultry, etc. It sometimes happened,
however, that the landlord would stipulate, that he should be at liberty
to demand of the tenant, either the annual payment in kind or a certain
sum of money instead of it. The price at which the payment in kind was
in this manner exchanged for a certain sum of money, is in Scotland
called the conversion price. As the option is always in the landlord to
take either the substance or the price, it is necessary, for the safety
of the tenant, that the conversion price should rather be below than
above the average market price. In many places, accordingly, it is not
much above one half of this price. Through the greater part of Scotland
this custom still continues with regard to poultry, and in some places
with regard to cattle. It might probably have continued to take place,
too, with regard to corn, had not the institution of the public fiars
put an end to it. These are annual valuations, according to the judgment
of an assize, of the average price of all the different sorts of grain,
and of all the different qualities of each, according to the actual
market price in every different county. This institution rendered it
sufficiently safe for the tenant, and much more convenient for the
landlord, to convert, as they call it, the corn rent, rather at what
should happen to be the price of the fiars of each year, than at any
certain fixed price. But the writers who have collected the prices of
corn in ancient times seem frequently to have mistaken what is called
in Scotland the conversion price for the actual market price. Fleetwood
acknowledges, upon one occasion, that he had made this mistake. As he
wrote his book, however, for a particular purpose, he does not think
proper to make this acknowledgment till after transcribing this
conversion price fifteen times. The price is eight shillings the
quarter of wheat. This sum in 1423, the year at which he begins with
it, contained the same quantity of silver as sixteen shillings of
our present money. But in 1562, the year at which he ends with it, it
contained no more than the same nominal sum does at present.

Secondly, they have been misled by the slovenly manner in which some
ancient statutes of assize had been sometimes transcribed by lazy
copiers, and sometimes, perhaps, actually composed by the legislature.

The ancient statutes of assize seem to have begun always with
determining what ought to be the price of bread and ale when the price
of wheat and barley were at the lowest; and to have proceeded gradually
to determine what it ought to be, according as the prices of those two
sorts of grain should gradually rise above this lowest price. But
the transcribers of those statutes seem frequently to have thought it
sufficient to copy the regulation as far as the three or four first and
lowest prices; saving in this manner their own labour, and judging,
I suppose, that this was enough to show what proportion ought to be
observed in all higher prices.

Thus, in the assize of bread and ale, of the 51st of Henry III. the
price of bread was regulated according to the different prices of wheat,
from one shilling to twenty shillings the quarter of the money of those
times. But in the manuscripts from which all the different editions of
the statutes, preceding that of Mr Ruffhead, were printed, the copiers
had never transcribed this regulation beyond the price of twelve
shillings. Several writers, therefore, being misled by this faulty
transcription, very naturally conclude that the middle price, or six
shillings the quarter, equal to about eighteen shillings of our present
money, was the ordinary or average price of wheat at that time.

In the statute of Tumbrel and Pillory, enacted nearly about the same
time, the price of ale is regulated according to every sixpence rise in
the price of barley, from two shillings, to four shillings the quarter.
That four shillings, however, was not considered as the highest price to
which barley might frequently rise in those times, and that these
prices were only given as an example of the proportion which ought to be
observed in all other prices, whether higher or lower, we may infer from
the last words of the statute: "Et sic deinceps crescetur vel diminuetur
per sex denarios." The expression is very slovenly, but the meaning is
plain enough, "that the price of ale is in this manner to be increased
or diminished according to every sixpence rise or fall in the price
of barley." In the composition of this statute, the legislature itself
seems to have been as negligent as the copiers were in the transcription
of the other.

In an ancient manuscript of the Regiam Majestatem, an old Scotch law
book, there is a statute of assize, in which the price of bread is
regulated according to all the different prices of wheat, from tenpence
to three shillings the Scotch boll, equal to about half an English
quarter. Three shillings Scotch, at the time when this assize is
supposed to have been enacted, were equal to about nine shillings
sterling of our present money Mr Ruddiman seems {See his Preface
to Anderson's Diplomata Scotiae.} to conclude from this, that three
shillings was the highest price to which wheat ever rose in those
times, and that tenpence, a shilling, or at most two shillings, were
the ordinary prices. Upon consulting the manuscript, however, it appears
evidently, that all these prices are only set down as examples of the
proportion which ought to be observed between the respective prices of
wheat and bread. The last words of the statute are "reliqua judicabis
secundum praescripta, habendo respectum ad pretium bladi."--"You shall
judge of the remaining cases, according to what is above written, having
respect to the price of corn."

Thirdly, they seem to have been misled too, by the very low price
at which wheat was sometimes sold in very ancient times; and to have
imagined, that as its lowest price was then much lower than in later
times its ordinary price must likewise have been much lower. They might
have found, however, that in those ancient times its highest price was
fully as much above, as its lowest price was below any thing that had
ever been known in later times. Thus, in 1270, Fleetwood gives us two
prices of the quarter of wheat. The one is four pounds sixteen shillings
of the money of those times, equal to fourteen pounds eight shillings of
that of the present; the other is six pounds eight shillings, equal to
nineteen pounds four shillings of our present money. No price can
be found in the end of the fifteenth, or beginning of the sixteenth
century, which approaches to the extravagance of these. The price of
corn, though at all times liable to variation varies most in those
turbulent and disorderly societies, in which the interruption of all
commerce and communication hinders the plenty of one part of the country
from relieving the scarcity of another. In the disorderly state of
England under the Plantagenets, who governed it from about the middle of
the twelfth till towards the end of the fifteenth century, one district
might be in plenty, while another, at no great distance, by having
its crop destroyed, either by some accident of the seasons, or by the
incursion of some neighbouring baron, might be suffering all the horrors
of a famine; and yet if the lands of some hostile lord were interposed
between them, the one might not be able to give the least assistance to
the other. Under the vigorous administration of the Tudors, who governed
England during the latter part of the fifteenth, and through the whole
of the sixteenth century, no baron was powerful enough to dare to
disturb the public security.

The reader will find at the end of this chapter all the prices of
wheat which have been collected by Fleetwood, from 1202 to 1597, both
inclusive, reduced to the money of the present times, and digested,
according to the order of time, into seven divisions of twelve years
each. At the end of each division, too, he will find the average price
of the twelve years of which it consists. In that long period of time,
Fleetwood has been able to collect the prices of no more than eighty
years; so that four years are wanting to make out the last twelve years.
I have added, therefore, from the accounts of Eton college, the prices
of 1598, 1599, 1600, and 1601. It is the only addition which I have
made. The reader will see, that from the beginning of the thirteenth
till after the middle of the sixteenth century, the average price of
each twelve years grows gradually lower and lower; and that towards
the end of the sixteenth century it begins to rise again. The prices,
indeed, which Fleetwood has been able to collect, seem to have been
those chiefly which were remarkable for extraordinary dearness or
cheapness; and I do not pretend that any very certain conclusion can be
drawn from them. So far, however, as they prove any thing at all, they
confirm the account which I have been endeavouring to give. Fleetwood
himself, however, seems, with most other writers, to have believed,
that, during all this period, the value of silver, in consequence of its
increasing abundance, was continually diminishing. The prices of
corn, which he himself has collected, certainly do not agree with this
opinion. They agree perfectly with that of Mr Dupré de St Maur, and with
that which I have been endeavouring to explain. Bishop Fleetwood and Mr
Dupré de St Maur are the two authors who seem to have collected, with
the greatest diligence and fidelity, the prices of things in ancient
times. It is some what curious that, though their opinions are so very
different, their facts, so far as they relate to the price of corn at
least, should coincide so very exactly.

It is not, however, so much from the low price of corn, as from that of
some other parts of the rude produce of land, that the most judicious
writers have inferred the great value of silver in those very ancient
times. Corn, it has been said, being a sort of manufacture, was, in
those rude ages, much dearer in proportion than the greater part of
other commodities; it is meant, I suppose, than the greater part of
unmanufactured commodities, such as cattle, poultry, game of all
kinds, etc. That in those times of poverty and barbarism these were
proportionably much cheaper than corn, is undoubtedly true. But this
cheapness was not the effect of the high value of silver, but of the
low value of those commodities. It was not because silver would in such
times purchase or represent a greater quantity of labour, but because
such commodities would purchase or represent a much smaller quantity
than in times of more opulence and improvement. Silver must certainly
be cheaper in Spanish America than in Europe; in the country where it is
produced, than in the country to which it is brought, at the expense of
a long carriage both by land and by sea, of a freight, and an insurance.
One-and-twenty pence halfpenny sterling, however, we are told by Ulloa,
was, not many years ago, at Buenos Ayres, the price of an ox chosen from
a herd of three or four hundred. Sixteen shillings sterling, we are told
by Mr Byron, was the price of a good horse in the capital of Chili. In
a country naturally fertile, but of which the far greater part is
altogether uncultivated, cattle, poultry, game of all kinds, etc. as
they can be acquired with a very small quantity of labour, so they will
purchase or command but a very small quantity. The low money price for
which they may be sold, is no proof that the real value of silver is
there very high, but that the real value of those commodities is very
low.

Labour, it must always be remembered, and not any particular commodity,
or set of commodities, is the real measure of the value both of silver
and of all other commodities.

But in countries almost waste, or but thinly inhabited, cattle, poultry,
game of all kinds, etc. as they are the spontaneous productions of
Nature, so she frequently produces them in much greater quantities than
the consumption of the inhabitants requires. In such a state of things,
the supply commonly exceeds the demand. In different states of society,
in different states of improvement, therefore, such commodities will
represent, or be equivalent, to very different quantities of labour.

In every state of society, in every stage of improvement, corn is the
production of human industry. But the average produce of every sort
of industry is always suited, more or less exactly, to the average
consumption; the average supply to the average demand. In every
different stage of improvement, besides, the raising of equal quantities
of corn in the same soil and climate, will, at an average, require
nearly equal quantities of labour; or, what comes to the same thing,
the price of nearly equal quantities; the continual increase of the
productive powers of labour, in an improved state of cultivation,
being more or less counterbalanced by the continual increasing price
of cattle, the principal instruments of agriculture. Upon all these
accounts, therefore, we may rest assured, that equal quantities of corn
will, in every state of society, in every stage of improvement, more
nearly represent, or be equivalent to, equal quantities of labour, than
equal quantities of any other part of the rude produce of land. Corn,
accordingly, it has already been observed, is, in all the different
stages of wealth and improvement, a more accurate measure of value
than any other commodity or set of commodities. In all those different
stages, therefore, we can judge better of the real value of silver, by
comparing it with corn, than by comparing it with any other commodity or
set of commodities.

Corn, besides, or whatever else is the common and favourite vegetable
food of the people, constitutes, in every civilized country, the
principal part of the subsistence of the labourer. In consequence of
the extension of agriculture, the land of every country produces a much
greater quantity of vegetable than of animal food, and the labourer
everywhere lives chiefly upon the wholesome food that is cheapest and
most abundant. Butcher's meat, except in the most thriving countries, or
where labour is most highly rewarded, makes but an insignificant part of
his subsistence; poultry makes a still smaller part of it, and game no
part of it. In France, and even in Scotland, where labour is somewhat
better rewarded than in France, the labouring poor seldom eat butcher's
meat, except upon holidays, and other extraordinary occasions. The money
price of labour, therefore, depends much more upon the average money
price of corn, the subsistence of the labourer, than upon that of
butcher's meat, or of any other part of the rude produce of land. The
real value of gold and silver, therefore, the real quantity of labour
which they can purchase or command, depends much more upon the quantity
of corn which they can purchase or command, than upon that of butcher's
meat, or any other part of the rude produce of land.

Such slight observations, however, upon the prices either of corn or of
other commodities, would not probably have misled so many intelligent
authors, had they not been influenced at the same time by the popular
notion, that as the quantity of silver naturally increases in every
country with the increase of wealth, so its value diminishes as its
quantity increases. This notion, however, seems to be altogether
groundless.

The quantity of the precious metals may increase in any country from
two different causes; either, first, from the increased abundance of the
mines which supply it; or, secondly, from the increased wealth of the
people, from the increased produce of their annual labour. The first of
these causes is no doubt necessarily connected with the diminution of
the value of the precious metals; but the second is not.

When more abundant mines are discovered, a greater quantity of
the precious metals is brought to market; and the quantity of the
necessaries and conveniencies of life for which they must be exchanged
being the same as before, equal quantities of the metals must be
exchanged for smaller quantities of commodities. So far, therefore,
as the increase of the quantity of the precious metals in any country
arises from the increased abundance of the mines, it is necessarily
connected with some diminution of their value.

When, on the contrary, the wealth of any country increases, when the
annual produce of its labour becomes gradually greater and greater,
a greater quantity of coin becomes necessary in order to circulate a
greater quantity of commodities: and the people, as they can afford it,
as they have more commodities to give for it, will naturally purchase a
greater and a greater quantity of plate. The quantity of their coin will
increase from necessity; the quantity of their plate from vanity and
ostentation, or from the same reason that the quantity of fine statues,
pictures, and of every other luxury and curiosity, is likely to increase
among them. But as statuaries and painters are not likely to be worse
rewarded in times of wealth and prosperity, than in times of poverty and
depression, so gold and silver are not likely to be worse paid for.

The price of gold and silver, when the accidental discovery of more
abundant mines does not keep it down, as it naturally rises with the
wealth of every country; so, whatever be the state of the mines, it is
at all times naturally higher in a rich than in a poor country. Gold and
silver, like all other commodities, naturally seek the market where the
best price is given for them, and the best price is commonly given for
every thing in the country which can best afford it. Labour, it must be
remembered, is the ultimate price which is paid for every thing; and
in countries where labour is equally well rewarded, the money price of
labour will be in proportion to that of the subsistence of the labourer.
But gold and silver will naturally exchange for a greater quantity of
subsistence in a rich than in a poor country; in a country which abounds
with subsistence, than in one which is but indifferently supplied with
it. If the two countries are at a great distance, the difference may be
very great; because, though the metals naturally fly from the worse to
the better market, yet it may be difficult to transport them in such
quantities as to bring their price nearly to a level in both. If the
countries are near, the difference will be smaller, and may sometimes
be scarce perceptible; because in this case the transportation will be
easy. China is a much richer country than any part of Europe, and the
difference between the price of subsistence in China and in Europe is
very great. Rice in China is much cheaper than wheat is any where
in Europe. England is a much richer country than Scotland, but the
difference between the money price of corn in those two countries is
much smaller, and is but just perceptible. In proportion to the quantity
or measure, Scotch corn generally appears to be a good deal cheaper than
English; but, in proportion to its quality, it is certainly somewhat
dearer. Scotland receives almost every year very large supplies from
England, and every commodity must commonly be somewhat dearer in the
country to which it is brought than in that from which it comes. English
corn, therefore, must be dearer in Scotland than in England; and yet in
proportion to its quality, or to the quantity and goodness of the flour
or meal which can be made from it, it cannot commonly be sold higher
there than the Scotch corn which comes to market in competition with it.

The difference between the money price of labour in China and in Europe,
is still greater than that between the money price of subsistence;
because the real recompence of labour is higher in Europe than in China,
the greater part of Europe being in an improving state, while China
seems to be standing still. The money price of labour is lower in
Scotland than in England, because the real recompence of labour is much
lower: Scotland, though advancing to greater wealth, advances much more
slowly than England. The frequency of emigration from Scotland, and the
rarity of it from England, sufficiently prove that the demand for labour
is very different in the two countries. The proportion between the real
recompence of labour in different countries, it must be remembered, is
naturally regulated, not by their actual wealth or poverty, but by their
advancing, stationary, or declining condition.

Gold and silver, as they are naturally of the greatest value among the
richest, so they are naturally of the least value among the poorest
nations. Among savages, the poorest of all nations, they are scarce of
any value.

In great towns, corn is always dearer than in remote parts of the
country. This, however, is the effect, not of the real cheapness of
silver, but of the real dearness of corn. It does not cost less labour
to bring silver to the great town than to the remote parts of the
country; but it costs a great deal more to bring corn.

In some very rich and commercial countries, such as Holland and the
territory of Genoa, corn is dear for the same reason that it is dear in
great towns. They do not produce enough to maintain their inhabitants.
They are rich in the industry and skill of their artificers and
manufacturers, in every sort of machinery which can facilitate and
abridge labour; in shipping, and in all the other instruments and means
of carriage and commerce: but they are poor in corn, which, as it must
be brought to them from distant countries, must, by an addition to its
price, pay for the carriage from those countries. It does not cost less
labour to bring silver to Amsterdam than to Dantzic; but it costs a
great deal more to bring corn. The real cost of silver must be nearly
the same in both places; but that of corn must be very different.
Diminish the real opulence either of Holland or of the territory of
Genoa, while the number of their inhabitants remains the same; diminish
their power of supplying themselves from distant countries; and the
price of corn, instead of sinking with that diminution in the quantity
of their silver, which must necessarily accompany this declension,
either as its cause or as its effect, will rise to the price of a
famine. When we are in want of necessaries, we must part with all
superfluities, of which the value, as it rises in times of opulence
and prosperity, so it sinks in times of poverty and distress. It is
otherwise with necessaries. Their real price, the quantity of labour
which they can purchase or command, rises in times of poverty and
distress, and sinks in times of opulence and prosperity, which are
always times of great abundance; for they could not otherwise be times
of opulence and prosperity. Corn is a necessary, silver is only a
superfluity.

Whatever, therefore, may have been the increase in the quantity of the
precious metals, which, during the period between the middle of the
fourteenth and that of the sixteenth century, arose from the increase
of wealth and improvement, it could have no tendency to diminish their
value, either in Great Britain, or in my other part of Europe. If those
who have collected the prices of things in ancient times, therefore,
had, during this period, no reason to infer the diminution of the value
of silver from any observations which they had made upon the prices
either of corn, or of other commodities, they had still less reason to
infer it from any supposed increase of wealth and improvement.

Second Period.--But how various soever may have been the opinions of the
learned concerning the progress of the value of silver during the first
period, they are unanimous concerning it during the second.

From about 1570 to about 1640, during a period of about seventy years,
the variation in the proportion between the value of silver and that
of corn held a quite opposite course. Silver sunk in its real value, or
would exchange for a smaller quantity of labour than before; and corn
rose in its nominal price, and, instead of being commonly sold for about
two ounces of silver the quarter, or about ten shillings of our present
money, came to be sold for six and eight ounces of silver the quarter,
or about thirty and forty shillings of our present money.

The discovery of the abundant mines of America seems to have been the
sole cause of this diminution in the value of silver, in proportion to
that of corn. It is accounted for, accordingly, in the same manner by
every body; and there never has been any dispute, either about the fact,
or about the cause of it. The greater part of Europe was, during this
period, advancing in industry and improvement, and the demand for silver
must consequently have been increasing; but the increase of the supply
had, it seems, so far exceeded that of the demand, that the value of
that metal sunk considerably. The discovery of the mines of America, it
is to be observed, does not seem to have had any very sensible effect
upon the prices of things in England till after 1570; though even the
mines of Potosi had been discovered more than twenty years before.

From 1595 to 1620, both inclusive, the average price of the quarter of
nine bushels of the best wheat, at Windsor market, appears, from the
accounts of Eton college, to have been £ 2:1:6 9/13. From which sum,
neglecting the fraction, and deducting a ninth, or 4s. 7 1/3d., the
price of the quarter of eight bushels comes out to have been £ 1:16:10
2/3. And from this sum, neglecting likewise the fraction, and deducting
a ninth, or 4s. 1 1/9d., for the difference between the price of the
best wheat and that of the middle wheat, the price of the middle wheat
comes out to have been about £ 1:12:8 8/9, or about six ounces and
one-third of an ounce of silver.

From 1621 to 1636, both inclusive, the average price of the same measure
of the best wheat, at the same market, appears, from the same accounts,
to have been £ 2:10s.; from which, making the like deductions as in the
foregoing case, the average price of the quarter of eight bushels of
middle wheat comes out to have been £ 1:19:6, or about seven ounces and
two-thirds of an ounce of silver.

Third Period.--Between 1630 and 1640, or about 1636, the effect of the
discovery of the mines of America, in reducing the value of silver,
appears to have been completed, and the value of that metal seems never
to have sunk lower in proportion to that of corn than it was about
that time. It seems to have risen somewhat in the course of the present
century, and it had probably begun to do so, even some time before the
end of the last.

From 1637 to 1700, both inclusive, being the sixty-four last years of
the last century the average price of the quarter of nine bushels of the
best wheat, at Windsor market, appears, from the same accounts, to have
been £ 2:11:0 1/3, which is only 1s. 0 1/3d. dearer than it had been
during the sixteen years before. But, in the course of these sixty-four
years, there happened two events, which must have produced a much
greater scarcity of corn than what the course of the season is would
otherwise have occasioned, and which, therefore, without supposing any
further reduction in the value of silver, will much more than account
for this very small enhancement of price.

The first of these events was the civil war, which, by discouraging
tillage and interrupting commerce, must have raised the price of
corn much above what the course of the seasons would otherwise have
occasioned. It must have had this effect, more or less, at all the
different markets in the kingdom, but particularly at those in the
neighbourhood of London, which require to be supplied from the greatest
distance. In 1648, accordingly, the price of the best wheat, at Windsor
market, appears, from the same accounts, to have been £ 4:5s., and, in
1649, to have been £ 4, the quarter of nine bushels. The excess of
those two years above £ 2:10s. (the average price of the sixteen years
preceding 1637 is £ 3:5s., which, divided among the sixty four last
years of the last century, will alone very nearly account for that small
enhancement of price which seems to have taken place in them.) These,
however, though the highest, are by no means the only high prices which
seem to have been occasioned by the civil wars.

The second event was the bounty upon the exportation of corn, granted
in 1688. The bounty, it has been thought by many people, by encouraging
tillage, may, in a long course of years, have occasioned a greater
abundance, and, consequently, a greater cheapness of corn in the home
market, than what would otherwise have taken place there. How far the
bounty could produce this effect at any time I shall examine hereafter:
I shall only observe at present, that between 1688 and 1700, it had
not time to produce any such effect. During this short period, its only
effect must have been, by encouraging the exportation of the surplus
produce of every year, and thereby hindering the abundance of one year
from compensating the scarcity of another, to raise the price in the
home market. The scarcity which prevailed in England, from 1693 to 1699,
both inclusive, though no doubt principally owing to the badness of
the seasons, and, therefore, extending through a considerable part
of Europe, must have been somewhat enhanced by the bounty. In 1699,
accordingly, the further exportation of corn was prohibited for nine
months.

There was a third event which occurred in the course of the same period,
and which, though it could not occasion any scarcity of corn, nor,
perhaps, any augmentation in the real quantity of silver which was
usually paid for it, must necessarily have occasioned some augmentation
in the nominal sum. This event was the great debasement of the silver
coin, by clipping and wearing. This evil had begun in the reign of
Charles II. and had gone on continually increasing till 1695; at which
time, as we may learn from Mr Lowndes, the current silver coin was, at
an average, near five-and-twenty per cent. below its standard value. But
the nominal sum which constitutes the market price of every commodity
is necessarily regulated, not so much by the quantity of silver, which,
according to the standard, ought to be contained in it, as by that
which, it is found by experience, actually is contained in it. This
nominal sum, therefore, is necessarily higher when the coin is much
debased by clipping and wearing, than when near to its standard value.

In the course of the present century, the silver coin has not at any
time been more below its standard weight than it is at present. But
though very much defaced, its value has been kept up by that of the gold
coin, for which it is exchanged. For though, before the late recoinage,
the gold coin was a good deal defaced too, it was less so than the
silver. In 1695, on the contrary, the value of the silver coin was not
kept up by the gold coin; a guinea then commonly exchanging for thirty
shillings of the worn and clipt silver. Before the late recoinage of the
gold, the price of silver bullion was seldom higher than five shillings
and sevenpence an ounce, which is but fivepence above the mint price.
But in 1695, the common price of silver bullion was six shillings and
fivepence an ounce, {Lowndes's Essay on the Silver Coin, 68.} which is
fifteen pence above the mint price. Even before the late recoinage of
the gold, therefore, the coin, gold and silver together, when compared
with silver bullion, was not supposed to be more than eight per cent.
below its standard value, In 1695, on the contrary, it had been supposed
to be near five-and-twenty per cent. below that value. But in the
beginning of the present century, that is, immediately after the great
recoinage in King William's time, the greater part of the current silver
coin must have been still nearer to its standard weight than it is at
present. In the course of the present century, too, there has been
no great public calamity, such as a civil war, which could either
discourage tillage, or interrupt the interior commerce of the country.
And though the bounty which has taken place through the greater part of
this century, must always raise the price of corn somewhat higher than
it otherwise would be in the actual state of tillage; yet, as in the
course of this century, the bounty has had full time to produce all the
good effects commonly imputed to it to encourage tillage, and thereby
to increase the quantity of corn in the home market, it may, upon the
principles of a system which I shall explain and examine hereafter, be
supposed to have done something to lower the price of that commodity the
one way, as well as to raise it the other. It is by many people supposed
to have done more. In the sixty-four years of the present century,
accordingly, the average price of the quarter of nine bushels of the
best wheat, at Windsor market, appears, by the accounts of Eton college,
to have been £ 2:0:6 10/32, which is about ten shillings and sixpence,
or more than five-and-twenty percent. cheaper than it had been during
the sixty-four last years of the last century; and about nine shillings
and sixpence cheaper than it had been during the sixteen years preceding
1636, when the discovery of the abundant mines of America may be
supposed to have produced its full effect; and about one shilling
cheaper than it had been in the twenty-six years preceding 1620, before
that discovery can well be supposed to have produced its full effect.
According to this account, the average price of middle wheat, during
these sixty-four first years of the present century, comes out to have
been about thirty-two shillings the quarter of eight bushels.

The value of silver, therefore, seems to have risen somewhat in
proportion to that of corn during the course of the present century,
and it had probably begun to do so even some time before the end of the
last.


In 1687, the price of the quarter of nine bushels of the best wheat, at
Windsor market, was £ 1:5:2, the lowest price at which it had ever been
from 1595.

In 1688, Mr Gregory King, a man famous for his knowledge in matters of
this kind, estimated the average price of wheat, in years of moderate
plenty, to be to the grower 3s. 6d. the bushel, or eight-and-twenty
shillings the quarter. The grower's price I understand to be the same
with what is sometimes called the contract price, or the price at which
a farmer contracts for a certain number of years to deliver a certain
quantity of corn to a dealer. As a contract of this kind saves the
farmer the expense and trouble of marketing, the contract price is
generally lower than what is supposed to be the average market price.
Mr King had judged eight-and-twenty shillings the quarter to be at that
time the ordinary contract price in years of moderate plenty. Before the
scarcity occasioned by the late extraordinary course of bad seasons,
it was, I have been assured, the ordinary contract price in all common
years.

In 1688 was granted the parliamentary bounty upon the exportation
of corn. The country gentlemen, who then composed a still greater
proportion of the legislature than they do at present, had felt that the
money price of corn was falling. The bounty was an expedient to raise it
artificially to the high price at which it had frequently been sold in
the times of Charles I. and II. It was to take place, therefore, till
wheat was so high as fortyeight shillings the quarter; that is, twenty
shillings, or 5-7ths dearer than Mr King had, in that very year,
estimated the grower's price to be in times of moderate plenty. If his
calculations deserve any part of the reputation which they have obtained
very universally, eight-and-forty shillings the quarter was a price
which, without some such expedient as the bounty, could not at that
time be expected, except in years of extraordinary scarcity. But the
government of King William was not then fully settled. It was in no
condition to refuse anything to the country gentlemen, from whom it
was, at that very time, soliciting the first establishment of the annual
land-tax.

The value of silver, therefore, in proportion to that of corn, had
probably risen somewhat before the end of the last century; and it seems
to have continued to do so during the course of the greater part of the
present, though the necessary operation of the bounty must have hindered
that rise from being so sensible as it otherwise would have been in the
actual state of tillage.

In plentiful years, the bounty, by occasioning an extraordinary
exportation, necessarily raises the price of corn above what it
otherwise would be in those years. To encourage tillage, by keeping up
the price of corn, even in the most plentiful years, was the avowed end
of the institution.

In years of great scarcity, indeed, the bounty has generally been
suspended. It must, however, have had some effect upon the prices of
many of those years. By the extraordinary exportation which it occasions
in years of plenty, it must frequently hinder the plenty of one year
from compensating the scarcity of another.

Both in years of plenty and in years of scarcity, therefore, the bounty
raises the price of corn above what it naturally would be in the actual
state of tillage. If during the sixty-four first years of the present
century, therefore, the average price has been lower than during the
sixty-four last years of the last century, it must, in the same state of
tillage, have been much more so, had it not been for this operation of
the bounty.

But, without the bounty, it may be said the state of tillage would not
have been the same. What may have been the effects of this institution
upon the agriculture of the country, I shall endeavour to explain
hereafter, when I come to treat particularly of bounties. I shall only
observe at present, that this rise in the value of silver, in proportion
to that of corn, has not been peculiar to England. It has been observed
to have taken place in France during the same period, and nearly in the
same proportion, too, by three very faithful, diligent, and laborious
collectors of the prices of corn, Mr Dupré de St Maur, Mr Messance,
and the author of the Essay on the Police of Grain. But in France, till
1764, the exportation of grain was by law prohibited; and it is somewhat
difficult to suppose, that nearly the same diminution of price which
took place in one country, notwithstanding this prohibition, should,
in another, be owing to the extraordinary encouragement given to
exportation.

It would be more proper, perhaps, to consider this variation in the
average money price of corn as the effect rather of some gradual rise in
the real value of silver in the European market, than of any fall in the
real average value of corn. Corn, it has already been observed, is, at
distant periods of time, a more accurate measure of value than either
silver or, perhaps, any other commodity. When, after the discovery of
the abundant mines of America, corn rose to three and four times its
former money price, this change was universally ascribed, not to any
rise in the real value of corn, but to a fall in the real value of
silver. If, during the sixty-four first years of the present century,
therefore, the average money price of corn has fallen somewhat below
what it had been during the greater part of the last century, we should,
in the same manner, impute this change, not to any fall in the real
value of corn, but to some rise in the real value of silver in the
European market.

The high price of corn during these ten or twelve years past, indeed,
has occasioned a suspicion that the real value of silver still continues
to fall in the European market. This high price of corn, however, seems
evidently to have been the effect of the extraordinary unfavourableness
of the seasons, and ought, therefore, to be regarded, not as a
permanent, but as a transitory and occasional event. The seasons, for
these ten or twelve years past, have been unfavourable through the
greater part of Europe; and the disorders of Poland have very much
increased the scarcity in all those countries, which, in dear years,
used to be supplied from that market. So long a course of bad seasons,
though not a very common event, is by no means a singular one; and
whoever has inquired much into the history of the prices of corn in
former times, will be at no loss to recollect several other examples
of the same kind. Ten years of extraordinary scarcity, besides, are not
more wonderful than ten years of extraordinary plenty. The low price
of corn, from 1741 to 1750, both inclusive, may very well be set in
opposition to its high price during these last eight or ten years. From
1741 to 1750, the average price of the quarter of nine bushels of the
best wheat, at Windsor market, it appears from the accounts of Eton
college, was only £ 1:13:9 4/5, which is nearly 6s.3d. below the average
price of the sixty-four first years of the present century. The average
price of the quarter of eight bushels of middle wheat comes out,
according to this account, to have been, during these ten years, only £
1:6:8.

Between 1741 and 1750, however, the bounty must have hindered the price
of corn from falling so low in the home market as it naturally would
have done. During these ten years, the quantity of all sorts of grain
exported, it appears from the custom-house books, amounted to no less
than 8,029,156 quarters, one bushel. The bounty paid for this amounted
to £ 1,514,962:17:4 1/2. In 1749, accordingly, Mr Pelham, at that time
prime minister, observed to the house of commons, that, for the three
years preceding, a very extraordinary sum had been paid as bounty for
the exportation of corn. He had good reason to make this observation,
and in the following year he might have had still better. In that single
year, the bounty paid amounted to no less than £ 324,176:10:6. {See
Tracts on the Corn Trade, Tract 3,} It is unnecessary to observe how
much this forced exportation must have raised the price of corn above
what it otherwise would have been in the home market.

At the end of the accounts annexed to this chapter the reader will find
the particular account of those ten years separated from the rest. He
will find there, too, the particular account of the preceding ten years,
of which the average is likewise below, though not so much below, the
general average of the sixty-four first years of the century. The year
1740, however, was a year of extraordinary scarcity. These twenty
years preceding 1750 may very well be set in opposition to the twenty
preceding 1770. As the former were a good deal below the general average
of the century, notwithstanding the intervention of one or two dear
years; so the latter have been a good deal above it, notwithstanding
the intervention of one or two cheap ones, of 1759, for example. If the
former have not been as much below the general average as the latter
have been above it, we ought probably to impute it to the bounty. The
change has evidently been too sudden to be ascribed to any change in the
value of silver, which is always slow and gradual. The suddenness of the
effect can be accounted for only by a cause which can operate suddenly,
the accidental variations of the seasons.

The money price of labour in Great Britain has, indeed, risen during the
course of the present century. This, however, seems to be the effect,
not so much of any diminution in the value of silver in the European
market, as of an increase in the demand for labour in Great Britain,
arising from the great, and almost universal prosperity of the country.
In France, a country not altogether so prosperous, the money price of
labour has, since the middle of the last century, been observed to sink
gradually with the average money price of corn. Both in the last century
and in the present, the day wages of common labour are there said to
have been pretty uniformly about the twentieth part of the average price
of the septier of wheat; a measure which contains a little more than
four Winchester bushels. In Great Britain, the real recompence
of labour, it has already been shewn, the real quantities of the
necessaries and conveniencies of life which are given to the labourer,
has increased considerably during the course of the present century.
The rise in its money price seems to have been the effect, not of any
diminution of the value of silver in the general market of Europe, but
of a rise in the real price of labour, in the particular market of Great
Britain, owing to the peculiarly happy circumstances of the country.

For some time after the first discovery of America, silver would
continue to sell at its former, or not much below its former price.
The profits of mining would for some time be very great, and much above
their natural rate. Those who imported that metal into Europe, however,
would soon find that the whole annual importation could not be disposed
of at this high price. Silver would gradually exchange for a smaller and
a smaller quantity of goods. Its price would sink gradually lower and
lower, till it fell to its natural price; or to what was just sufficient
to pay, according to their natural rates, the wages of the labour, the
profits of the stock, and the rent of the land, which must be paid in
order to bring it from the mine to the market. In the greater part of
the silver mines of Peru, the tax of the king of Spain, amounting to a
tenth of the gross produce, eats up, it has already been observed,
the whole rent of the land. This tax was originally a half; it soon
afterwards fell to a third, then to a fifth, and at last to a tenth, at
which late it still continues. In the greater part of the silver mines
of Peru, this, it seems, is all that remains, after replacing the stock
of the undertaker of the work, together with its ordinary profits; and
it seems to be universally acknowledged that these profits, which were
once very high, are now as low as they can well be, consistently with
carrying on the works.

The tax of the king of Spain was reduced to a fifth of the registered
silver in 1504 {Solorzano, vol, ii.}, one-and-forty years before 1545,
the date of the discovery of the mines of Potosi. In the course of
ninety years, or before 1636, these mines, the most fertile in all
America, had time sufficient to produce their full effect, or to reduce
the value of silver in the European market as low as it could well fall,
while it continued to pay this tax to the king of Spain. Ninety years is
time sufficient to reduce any commodity, of which there is no monopoly,
to its natural price, or to the lowest price at which, while it pays
a particular tax, it can continue to be sold for any considerable time
together.

The price of silver in the European market might, perhaps, have fallen
still lower, and it might have become necessary either to reduce the tax
upon it, not only to one-tenth, as in 1736, but to one twentieth, in the
same manner as that upon gold, or to give up working the greater part
of the American mines which are now wrought. The gradual increase of
the demand for silver, or the gradual enlargement of the market for the
produce of the silver mines of America, is probably the cause which has
prevented this from happening, and which has not only kept up the
value of silver in the European market, but has perhaps even raised it
somewhat higher than it was about the middle of the last century.

Since the first discovery of America, the market for the produce of its
silver mines has been growing gradually more and more extensive.

First, the market of Europe has become gradually more and more
extensive. Since the discovery of America, the greater part of Europe
has been much improved. England, Holland, France, and Germany; even
Sweden, Denmark, and Russia, have all advanced considerably, both in
agriculture and in manufactures. Italy seems not to have gone backwards.
The fall of Italy preceded the conquest of Peru. Since that time it
seems rather to have recovered a little. Spain and Portugal, indeed, are
supposed to have gone backwards. Portugal, however, is but a very small
part of Europe, and the declension of Spain is not, perhaps, so great as
is commonly imagined. In the beginning of the sixteenth century, Spain
was a very poor country, even in comparison with France, which has been
so much improved since that time. It was the well known remark of
the emperor Charles V. who had travelled so frequently through both
countries, that every thing abounded in France, but that every thing
was wanting in Spain. The increasing produce of the agriculture and
manufactures of Europe must necessarily have required a gradual increase
in the quantity of silver coin to circulate it; and the increasing
number of wealthy individuals must have required the like increase in
the quantity of their plate and other ornaments of silver.

Secondly, America is itself a new market, for the produce of its
own silver mines; and as its advances in agriculture, industry,
and population, are much more rapid than those of the most thriving
countries in Europe, its demand must increase much more rapidly. The
English colonies are altogether a new market, which, partly for coin,
and partly for plate, requires a continual augmenting supply of silver
through a great continent where there never was any demand before.
The greater part, too, of the Spanish and Portuguese colonies, are
altogether new markets. New Granada, the Yucatan, Paraguay, and the
Brazils, were, before discovered by the Europeans, inhabited by savage
nations, who had neither arts nor agriculture. A considerable degree
of both has now been introduced into all of them. Even Mexico and
Peru, though they cannot be considered as altogether new markets, are
certainly much more extensive ones than they ever were before. After all
the wonderful tales which have been published concerning the splendid
state of those countries in ancient times, whoever reads, with any
degree of sober judgment, the history of their first discovery and
conquest, will evidently discern that, in arts, agriculture, and
commerce, their inhabitants were much more ignorant than the Tartars
of the Ukraine are at present. Even the Peruvians, the more civilized
nation of the two, though they made use of gold and silver as ornaments,
had no coined money of any kind. Their whole commerce was carried on by
barter, and there was accordingly scarce any division of labour among
them. Those who cultivated the ground, were obliged to build their own
houses, to make their own household furniture, their own clothes, shoes,
and instruments of agriculture. The few artificers among them are
said to have been all maintained by the sovereign, the nobles, and the
priests, and were probably their servants or slaves. All the ancient
arts of Mexico and Peru have never furnished one single manufacture
to Europe. The Spanish armies, though they scarce ever exceeded five
hundred men, and frequently did not amount to half that number, found
almost everywhere great difficulty in procuring subsistence. The famines
which they are said to have occasioned almost wherever they went, in
countries, too, which at the same time are represented as very populous
and well cultivated, sufficiently demonstrate that the story of this
populousness and high cultivation is in a great measure fabulous. The
Spanish colonies are under a government in many respects less favourable
to agriculture, improvement, and population, than that of the English
colonies. They seem, however, to be advancing in all those much more
rapidly than any country in Europe. In a fertile soil and happy climate,
the great abundance and cheapness of land, a circumstance common to all
new colonies, is, it seems, so great an advantage, as to compensate
many defects in civil government. Frezier, who visited Peru in 1713,
represents Lima as containing between twenty-five and twenty-eight
thousand inhabitants. Ulloa, who resided in the same country between
1740 and 1746, represents it as containing more than fifty thousand.
The difference in their accounts of the populousness of several other
principal towns of Chili and Peru is nearly the same; and as there seems
to be no reason to doubt of the good information of either, it marks
an increase which is scarce inferior to that of the English colonies.
America, therefore, is a new market for the produce of its own silver
mines, of which the demand must increase much more rapidly than that of
the most thriving country in Europe.

Thirdly, the East Indies is another market for the produce of the
silver mines of America, and a market which, from the time of the first
discovery of those mines, has been continually taking off a greater and
a greater quantity of silver. Since that time, the direct trade between
America and the East Indies, which is carried on by means of the
Acapulco ships, has been continually augmenting, and the indirect
intercourse by the way of Europe has been augmenting in a still greater
proportion. During the sixteenth century, the Portuguese were the only
European nation who carried on any regular trade to the East Indies. In
the last years of that century, the Dutch began to encroach upon
this monopoly, and in a few years expelled them from their principal
settlements in India. During the greater part of the last century, those
two nations divided the most considerable part of the East India trade
between them; the trade of the Dutch continually augmenting in a still
greater proportion than that of the Portuguese declined. The English and
French carried on some trade with India in the last century, but it
has been greatly augmented in the course of the present. The East
India trade of the Swedes and Danes began in the course of the present
century. Even the Muscovites now trade regularly with China, by a sort
of caravans which go over land through Siberia and Tartary to Pekin. The
East India trade of all these nations, if we except that of the
French, which the last war had well nigh annihilated, has been almost
continually augmenting. The increasing consumptions of East India goods
in Europe is, it seems, so great, as to afford a gradual increase of
employment to them all. Tea, for example, was a drug very little used in
Europe, before the middle of the last century. At present, the value of
the tea annually imported by the English East India company, for the
use of their own countrymen, amounts to more than a million and a half
a year; and even this is not enough; a great deal more being constantly
smuggled into the country from the ports of Holland, from Gottenburgh
in Sweden, and from the coast of France, too, as long as the French East
India company was in prosperity. The consumption of the porcelain of
China, of the spiceries of the Moluccas, of the piece goods of Bengal,
and of innumerable other articles, has increased very nearly in a like
proportion. The tonnage, accordingly, of all the European shipping
employed in the East India trade, at any one time during the last
century, was not, perhaps, much greater than that of the English East
India company before the late reduction of their shipping.

But in the East Indies, particularly in China and Indostan, the value
of the precious metals, when the Europeans first began to trade to those
countries, was much higher than in Europe; and it still continues to be
so. In rice countries, which generally yield two, sometimes three crops
in the year, each of them more plentiful than any common crop of corn,
the abundance of food must be much greater than in any corn country
of equal extent. Such countries are accordingly much more populous. In
them, too, the rich, having a greater superabundance of food to dispose
of beyond what they themselves can consume, have the means of purchasing
a much greater quantity of the labour of other people. The retinue of a
grandee in China or Indostan accordingly is, by all accounts, much more
numerous and splendid than that of the richest subjects in Europe. The
same superabundance of food, of which they have the disposal, enables
them to give a greater quantity of it for all those singular and rare
productions which nature furnishes but in very small quantities; such
as the precious metals and the precious stones, the great objects of the
competition of the rich. Though the mines, therefore, which supplied
the Indian market, had been as abundant as those which supplied the
European, such commodities would naturally exchange for a greater
quantity of food in India than in Europe. But the mines which supplied
the Indian market with the precious metals seem to have been a good deal
less abundant, and those which supplied it with the precious stones
a good deal more so, than the mines which supplied the European. The
precious metals, therefore, would naturally exchange in India for a
somewhat greater quantity of the precious stones, and for a much greater
quantity of food than in Europe. The money price of diamonds, the
greatest of all superfluities, would be somewhat lower, and that of
food, the first of all necessaries, a great deal lower in the one
country than in the other. But the real price of labour, the real
quantity of the necessaries of life which is given to the labourer, it
has already been observed, is lower both in China and Indostan, the two
great markets of India, than it is through the greater part of Europe.
The wages of the labourer will there purchase a smaller quantity of
food: and as the money price of food is much lower in India than in
Europe, the money price of labour is there lower upon a double account;
upon account both of the small quantity of food which it will purchase,
and of the low price of that food. But in countries of equal art and
industry, the money price of the greater part of manufactures will be
in proportion to the money price of labour; and in manufacturing art
and industry, China and Indostan, though inferior, seem not to be much
inferior to any part of Europe. The money price of the greater part of
manufactures, therefore, will naturally be much lower in those great
empires than it is anywhere in Europe. Through the greater part of
Europe, too, the expense of land-carriage increases very much both the
real and nominal price of most manufactures. It costs more labour, and
therefore more money, to bring first the materials, and afterwards the
complete manufacture to market. In China and Indostan, the extent and
variety of inland navigations save the greater part of this labour, and
consequently of this money, and thereby reduce still lower both the real
and the nominal price of the greater part of their manufactures. Upon
all these accounts, the precious metals are a commodity which it always
has been, and still continues to be, extremely advantageous to carry
from Europe to India. There is scarce any commodity which brings a
better price there; or which, in proportion to the quantity of labour
and commodities which it costs in Europe, will purchase or command
a greater quantity of labour and commodities in India. It is more
advantageous, too, to carry silver thither than gold; because in China,
and the greater part of the other markets of India, the proportion
between fine silver and fine gold is but as ten, or at most as twelve
to one; whereas in Europe it is as fourteen or fifteen to one. In China,
and the greater part of the other markets of India, ten, or at most
twelve ounces of silver, will purchase an ounce of gold; in Europe, it
requires from fourteen to fifteen ounces. In the cargoes, therefore,
of the greater part of European ships which sail to India, silver
has generally been one of the most valuable articles. It is the most
valuable article in the Acapulco ships which sail to Manilla. The silver
of the new continent seems, in this manner, to be one of the principal
commodities by which the commerce between the two extremities of the old
one is carried on; and it is by means of it, in a great measure, that
those distant parts of the world are connected with one another.

In order to supply so very widely extended a market, the quantity of
silver annually brought from the mines must not only be sufficient to
support that continued increase, both of coin and of plate, which is
required in all thriving countries; but to repair that continual waste
and consumption of silver which takes place in all countries where that
metal is used.

The continual consumption of the precious metals in coin by wearing,
and in plate both by wearing and cleaning, is very sensible; and in
commodities of which the use is so very widely extended, would alone
require a very great annual supply. The consumption of those metals in
some particular manufactures, though it may not perhaps be greater
upon the whole than this gradual consumption, is, however, much more
sensible, as it is much more rapid. In the manufactures of Birmingham
alone, the quantity of gold and silver annually employed in gilding and
plating, and thereby disqualified from ever afterwards appearing in the
shape of those metals, is said to amount to more than fifty thousand
pounds sterling. We may from thence form some notion how great must be
the annual consumption in all the different parts of the world, either
in manufactures of the same kind with those of Birmingham, or in laces,
embroideries, gold and silver stuffs, the gilding of books, furniture,
etc. A considerable quantity, too, must be annually lost in transporting
those metals from one place to another both by sea and by land. In the
greater part of the governments of Asia, besides, the almost universal
custom of concealing treasures in the bowels of the earth, of which the
knowledge frequently dies with the person who makes the concealment,
must occasion the loss of a still greater quantity.

The quantity of gold and silver imported at both Cadiz and Lisbon
(including not only what comes under register, but what may be supposed
to be smuggled) amounts, according to the best accounts, to about six
millions sterling a-year.

According to Mr Meggens {Postscript to the Universal Merchant p. 15 and
16. This postscript was not printed till 1756, three years after the
publication of the book, which has never had a second edition. The
postscript is, therefore, to be found in few copies; it corrects several
errors in the book.}, the annual importation of the precious metals
into Spain, at an average of six years, viz. from 1748 to 1753, both
inclusive, and into Portugal, at an average of seven years, viz. from
1747 to 1753, both inclusive, amounted in silver to 1,101,107 pounds
weight, and in gold to 49,940 pounds weight. The silver, at sixty two
shillings the pound troy, amounts to £ 3,413,431:10s. sterling. The
gold, at forty-four guineas and a half the pound troy, amounts to
£ 2,333,446:14s. sterling. Both together amount to £ 5,746,878:4s.
sterling. The account of what was imported under register, he assures
us, is exact. He gives us the detail of the particular places from which
the gold and silver were brought, and of the particular quantity of each
metal, which, according to the register, each of them afforded. He makes
an allowance, too, for the quantity of each metal which, he supposes,
may have been smuggled. The great experience of this judicious merchant
renders his opinion of considerable weight.

According to the eloquent, and sometimes well-informed, author of
the Philosophical and Political History of the Establishment of the
Europeans in the two Indies, the annual importation of registered gold
and silver into Spain, at an average of eleven years, viz. from 1754 to
1764, both inclusive, amounted to 13,984,185 3/5 piastres of ten reals.
On account of what may have been smuggled, however, the whole annual
importation, he supposes, may have amounted to seventeen millions
of piastres, which, at 4s. 6d. the piastre, is equal to £ 3,825,000
sterling. He gives the detail, too, of the particular places from which
the gold and silver were brought, and of the particular quantities of
each metal, which according to the register, each of them afforded.
He informs us, too, that if we were to judge of the quantity of gold
annually imported from the Brazils to Lisbon, by the amount of the
tax paid to the king of Portugal, which it seems, is one-fifth of the
standard metal, we might value it at eighteen millions of cruzadoes,
or forty-five millions of French livres, equal to about twenty millions
sterling. On account of what may have been smuggled, however, we may
safely, he says, add to this sum an eighth more, or £ 250,000 sterling,
so that the whole will amount to £ 2,250,000 sterling. According to this
account, therefore, the whole annual importation of the precious metals
into both Spain and Portugal, mounts to about £ 6,075,000 sterling.

Several other very well authenticated, though manuscript accounts, I
have been assured, agree in making this whole annual importation amount,
at an average, to about six millions sterling; sometimes a little more,
sometimes a little less.

The annual importation of the precious metals into Cadiz and Lisbon,
indeed, is not equal to the whole annual produce of the mines of
America. Some part is sent annually by the Acapulco ships to Manilla;
some part is employed in a contraband trade, which the Spanish colonies
carry on with those of other European nations; and some part, no doubt,
remains in the country. The mines of America, besides, are by no means
the only gold and silver mines in the world. They, are, however, by far
the most abundant. The produce of all the other mines which are known is
insignificant, it is acknowledged, in comparison with their's; and
the far greater part of their produce, it is likewise acknowledged,
is annually imported into Cadiz and Lisbon. But the consumption of
Birmingham alone, at the rate of fifty thousand pounds a-year, is equal
to the hundred-and-twentieth part of this annual importation, at the
rate of six millions a-year. The whole annual consumption of gold and
silver, therefore, in all the different countries of the world where
those metals are used, may, perhaps, be nearly equal to the whole annual
produce. The remainder may be no more than sufficient to supply the
increasing demand of all thriving countries. It may even have fallen so
far short of this demand, as somewhat to raise the price of those metals
in the European market.

The quantity of brass and iron annually brought from the mine to the
market, is out of all proportion greater than that of gold and silver.
We do not, however, upon this account, imagine that those coarse metals
are likely to multiply beyond the demand, or to become gradually cheaper
and cheaper. Why should we imagine that the precious metals are likely
to do so? The coarse metals, indeed, though harder, are put to much
harder uses, and, as they are of less value, less care is employed in
their preservation. The precious metals, however, are not necessarily
immortal any more than they, but are liable, too, to be lost, wasted,
and consumed, in a great variety of ways.

The price of all metals, though liable to slow and gradual variations,
varies less from year to year than that of almost any other part of the
rude produce of land: and the price of the precious metals is even
less liable to sudden variations than that of the coarse ones. The
durableness of metals is the foundation of this extraordinary steadiness
of price. The corn which was brought to market last year will be all, or
almost all, consumed, long before the end of this year. But some part
of the iron which was brought from: the mine two or three hundred years
ago, may be still in use, and, perhaps, some part of the gold which was
brought from it two or three thousand years ago. The different masses
of corn, which, in different years, must supply the consumption of the
world, will always be nearly in proportion to the respective produce of
those different years. But the proportion between the different masses
of iron which may be in use in two different years, will be very little
affected by any accidental difference in the produce of the iron mines
of those two years; and the proportion between the masses of gold will
be still less affected by any such difference in the produce of the
gold mines. Though the produce of the greater part of metallic mines,
therefore, varies, perhaps, still more from year to year than that of
the greater part of corn fields, those variations have not the same
effect upon the price of the one species of commodities as upon that of
the other.