of profit; then, whether wages and profits be high or low, and whether the quantity of labor expended be much or little, these two things will, on the average, exchange for one another.

XIV. If one of two things commands, on the average, a greater value than the other, the cause must be that it requires for its production either a greater quantity of labor, or a kind of labor permanently paid at a higher rate; or that the capital, or part of the capital, which supports that labor, must be advanced for a longer period; or, lastly, that the production is attended with some circumstance which requires to be compensated by a permanently higher rate of profit.

XV. Of these elements, the quantity of labor required for the production is the most important; the effect of the others is smaller, though none of them are insignificant.

XVI. The lower profits are, the less important become the minor elements of cost of production, and the less do commodities deviate from a value proportioned to the quantity and quality of the labor required for their production.

XVII. But every fall of profits lowers, in some degree, the cost value of things made with much or durable machinery, and raises that of things made by hand; and every rise of profits does the reverse.

2. Such is the general theory of Exchange Value. It is necessary, however, to remark that this theory contemplates a system of production carried on by capitalists for profit, and not by laborers for subsistence. In proportion as we admit this last supposition-and in most countries we must admit it, at least in respect of agricultural produce, to a very great extent-such of the preceding theorems as relate to the dependence of value on cost of production will require modification. Those theorems are all grounded on the supposition, that the producer's object and aim is to

derive a profit from his capital. This granted, it follows that he must sell his commodity at the price which will afford the ordinary rate of profit, that is to say, it must exchange for other commodities at its cost value. But the peasant-proprietor, the metayer, and even the peasantfarmer, or allotment-holder-the laborer, under whatever name, producing on his own account-is seeking, not an investment for his little capital, but an advantageous employment for his time and labor. His disbursements, beyond his own maintenance and that of his family, are so small, that nearly the whole proceeds of the sale of his produce are the wages of labor. When he and his family have been fed from the produce of his farm (and perhaps clothed with materials grown thereon, and manufactured in the family) he may, in respect of the supplementary remuneration derived from the sale of his surplus produce, be compared to those laborers who, deriving their subsistence from an independent source, can afford to sell their labor at any price which is to their minds worth the exertion. A peasant, who supports himself and his family with one portion of his produce, will often sell the remainder very much below what would be its cost value to a capitalist.

There is, however, even in this case, a minimum, or inferior limit, of value. The part of his produce which he carries to market, must bring in to him the value of all necessaries which he is compelled to purchase; and it must enable him to pay his rent. Rent, under peasant cultivation, is not governed by the principles set forth in the chapters immediately preceding, but is either determined by custom, as in the case of metayers, or, if fixed by competition, depends on the ratio of population to land. Rent, therefore, in this case, is an element of cost of production. The peasant must work until he has cleared his rent and the price of all purchased necessaries. After this, he will

go on working, only if he can sell the produce for such a price as will overcome his aversion to labor.

The minimum just mentioned is what the peasant must obtain in exchange for the whole of his surplus produce. But inasmuch as this surplus is not a fixed quantity, but may be either greater or less according to the degree of his industry, a minimum value for the whole of it does not give any minimum value for a definite quantity of the commodity. In this state of things, therefore, it can hardly be said, that the value depends at all on cost of production. It depends entirely on demand and supply, that is, on the proportion between the quantity of surplus food which the peasants choose to produce, and the numbers of the nonagricultural, or rather of the non-peasant population. If the buying class is numerous and the growing class lazy, food may be permanently at a scarcity price. I am not aware that this case has anywhere a real existence. If the growing class is energetic and industrious, and the buyers few, food will be extremely cheap. This also is a rare case, though some parts of France perhaps approximate to it. The common cases are, either that, as in Ireland, the peasant class is indolent and the buyers few, or the peasants industrious and the town population numerous and opulent, as in Belgium, the north of Italy, and parts of Germany. The price of the produce will adjust itself to these varieties of circumstances, unless modified, as in many cases it is, by the competition of producers who are not peasants, or by the prices of foreign markets.

3. Another anomalous case is that of slave-grown produce; which presents, however, by no means the same degree of complication. The slave-owner is a capitalist, and his inducement to production consists in a profit on his capital. This profit must amount to the ordinary rate. In respect to his expenses, he is in the same position as if his

slaves were free laborers working with their present efficiency, and were hired with wages equal to their present cost. If the cost is less, in proportion to the work done, than the wages of free labor would be, so much the greater are his profits; but if all other producers in the country possess the same advantage, the values of commodities will not be at all affected by it. The only case in which they can be affected, is when the privilege of cheap labor is confined to particular branches of production, free laborers at proportionably higher wages being employed in the remainder. In this case, as in all cases of permanent inequality between the wages of different employments, prices and values receive the impress of the inequality. Slave-grown will exchange for non-slave-grown commodities in a less ratio than that of the quantity of labor required for their production; the value of the former will be less, and of the latter greater, than if slavery did not exist.

The further adaptation of the theory of value to the varieties of existing or possible industrial systems may be left with great advantage to the intelligent reader. It is well said by Montesquieu, "Il ne faut pas toujours tellement épuiser un sujet, qu'on ne laisse rien à faire au lecteur. Il ne s'agit pas de faire lire, mais de faire penser."*

* Esprit des Lois, liv. xi. ad finem.