not the less tend in the long run to augment both. They increase the return to capital; and of this increase the benefit must necessarily accrue either to the capitalist in greater profits, or to the customer in diminished prices; affording, in either case, an augmented fund from which accumulation may be made, while enlarged profits also hold out an increased inducement to accumulation. In the case we before selected, in which the immediate result of the improvement was to diminish the gross produce from two thousand four hundred quarters to one thousand five hundred, yet the profit of the capitalist being now five hundred quarters instead of four hundred, the extra one hundred quarters, if regularly saved, would in a few years replace the one thousand quarters subtracted from his circulating capital. Now the extension of business which almost certainly follows in any department in which an improvement has been made, affords a strong inducement to those engaged in it to add to their capital; and hence, at the slow pace at which improvements are usually introduced, a great part of the capital which the improvement ultimately absorbs, is drawn from the increased profits and increased savings which it has itself called forth. This tendency of improvements in production to cause increased accumulation, and thereby ultimately to increase the gross produce, even if temporarily diminishing it, will assume a still more decided character if it should appear that there are assignable limits both to the accumulation of capital, and to the increase of production from the land, which limits once attained, all further increase of produce must stop; but that improvements in production, whatever may be their other effects, tend to throw one, or both of these limits farther off. Now, these are truths which will appear in the clearest light in a subsequent stage of our investigation. It will be seen, that the quantity of capital which will, or even which can, be accumulated in any country, and the amount of gross produce which will, or even which can, be raised, bear a proportion to the state of the arts of production there existing; and that every improvement, even if for the time it diminish the circulating capital and the gross produce, ultimately makes room for a larger amount of both, than could possibly have existed otherwise. It is this which is the conclusive answer to the objections against machinery; and the proof thence arising of the ultimate benefit to labourers of mechanical inventions even in the existing state of society, will hereafter be seen to be conclusive.* But this does not discharge governments from the obligation of alleviating, and if possible preventing, the evils of which this source of ultimate benefit is or may be productive to an existing generation. If the sinking or fixing of capital in machinery or useful works, were ever to proceed at such a pace as to impair materially the funds for the maintenance of labour, it would be incumbent on legislators to take measures for moderating its rapidity: and since improvements which do not diminish employment on the whole, almost always throw some particular class of labourers out of it, there cannot be a more legitimate object of the legislator's care than the interests of those who are thus sacrificed to the gains of their fellow-citizens and of pos terity. To return to the theoretical distinction between fixed and circulating capital. Since all wealth which is destined to be employed for reproduction comes within the designation of capital, there are parts of capital which do not agree with the definition of either species of it; for instance, the stock of finished goods which a manufacturer or dealer at any time possesses unsold in his warehouses. But this, though capital as to its destination, is not yet capital in actual exercise: it is not engaged in production, but has first to be sold or exchanged, that is, converted into an equivalent value of some other commodities; and therefore is not yet either fixed or circulating capital; but will become either * Infra, book iv. chap. v. one or the other, or be eventually divided between them. With the proceeds of his finished goods, a manufacturer will partly pay his work-people, partly replenish his stock of the materials of his manufacture, and partly provide new buildings and machinery, or repair the old; but how much will be devoted to one purpose, and how much to another, depends on the nature of the manufacture, and the requirements of the particular moment. It should be observed further, that the portion of capital consumed in the form of seed or material, though, unlike fixed capital, it requires to be at once replaced from the gross produce, stands yet in the same relation to the employment of labour, as fixed capital does. What is expended in materials is as much withdrawn from the maintenance and remuneration of labourers, as what is fixed in machinery; and if capital now expended in wages were diverted to the providing of materials, the effect on the labourers would be as prejudicial as if it were converted into fixed capital. This, however, is a kind of change which never takes place. The tendency of improvements in production is always to economize, never to increase, the expenditure of seed or material for a given produce; and the interest of the labourers has no detriment to apprehend from this source. CHAPTER VII. ON WHAT DEPENDS THE DEGREE OF PRODUCTIVENESS 1. WE have concluded our general survey of the requisites of production. We have found that they may be reduced to three labour, capital, and the materials and motive forces afforded by nature. Of these, labour and the raw material of the globe are primary and indispensable. Natural motive powers may be called in to the assistance of labour, and are a help, but not an essential, of production. The remaining requisite, capital, is itself the product of labour: its instrumentality in production is therefore, in reality, that of labour in an indirect shape. It does not the less require to be specified separately. A previous application of labour to produce the capital required for consumption during the work, is no less essential than the application of labour to the work itself. Of capital, again, one, and by far the largest, portion, conduces to production only by sustaining in existence the labour which produces: the remainder, namely the instruments and materials, contribute to it directly, in the same manner with natural agents, and the materials supplied by nature. We now advance to the second great question in political economy; on what the degree of productiveness of these agents depends. For it is evident that their productive efficacy varies greatly at various times and places. With the same population and extent of territory, some countries have a much larger amount of production than others, and the same country at one time a greater amount than itself at another. Compare England either with a similar extent of territory in Russia, or with an equal population of Russians. Compare England now with England in the middle ages; Sicily, Northern Africa, or Syria at present, with the same countries at the time of their greatest prosperity, before the Roman conquest. Some of the causes which contribute to this difference of productiveness are obvious; others not so much We proceed to specify several of them. So. § 2. The most evident cause of superior productiveness is what are called natural advantages. These are various. Fertility of soil is one of the principal. In this there are great varieties, from the deserts of Arabia to the alluvial plains of the Ganges, the Niger, and the Mississippi. A favourable climate is even more important than a rich soil. There are countries capable of being inhabited, but too cold to be compatible with agriculture. Their inhabitants cannot pass beyond the nomadic state; they must live, like the Laplanders, by the domestication of the rein-deer, if not by hunting or fishing, like the miserable Esquimaux. There are countries where oats will ripen, but not wheat, such as the North of Scotland; others where wheat can be grown, but from excess of moisture and want of sunshine, affords but a precarious crop; as in parts of Ireland. With each advance towards the south, or, in the European temperate region, towards the east, some new branch of agriculture becomes first possible, then advantageous; the vine, maize, figs, olives, silk, rice, dates, successively present themselves, until we come to the sugar, coffee, cotton, spices, &c. of climates which also afford, of the more common agricultural products, and with only a slight degree of cultivation, two or even three harvests in a year. Nor is it in agriculture alone that differences of climate are important. Their influence is felt in many other branches of production in the durability of all work which is exposed to the air; of buildings, for example. If the temples of Karnac and Luxor had not been injured by men, they might have subsisted in their original perfection almost for ever, for the inscriptions on : |