private life might be, succeeded that splendid and mischievous reign, and the greatest, indeed the only, error of the Duke of Orleans, his confidence in a clever and unprincipled projector, however hurtful to his country for the moment, yet produced no permanent mischief, while it rather tended to encourage speculations connected with money and trade and taxation. Accordingly, both in France and Italy, those subjects occupied the attention of learned men during the first half of the eighteenth century, and we have seen how great a progress was made between 1720 and 1770 in establishing the sound principles of which a considerable portion had been anticipated nearly a hundred years before. In England, Mr. Hume had contributed more largely to the science than all the other inquirers who handled these important subjects. In France the Economists had reduced them to a system, though they mingled them with important errors, and enveloped them in a style exceedingly repulsive, and not well calculated to instruct even the few readers whom it suffered the importance of the subject matter to attract. But it remained to give a more ample exposition of the whole subject; to explain and to illustrate all the fundamental principles, many of which had been left either assumed or ill defined, and certainly not clearly laid down nor exhibited in their connexion with the other parts of the inquiry; to purge the theory of the new errors which had replaced those exploded; to expound the doctrines in a more catholic and less sectarian spirit than the followers of Quesnay displayed, and in a less detached and occasional manner than necessarily prevailed in the Essays of Hume, though from his admirably generalizing mind no series of separate discourses ever moulded themselves more readily into a system. This service of inestimable value Dr. Smith's great work rendered to science; and it likewise contained many speculations, and many deductions of fact upon the details of economical inquiry, never

before exhibited by any of his predecessors. It had also the merit of a most clear and simple style, with a copiousness of illustration, whether from facts or from imagination, attained by no other writer but Mr. Hume, unsurpassed even by him, and which might well be expected from the author of the Theory of Moral Sentiments.'

ANALYTICAL VIEW OF THE WEALTH OF NATIONS.

I. Labour is the source of all human enjoyment; it may be even reckoned the source of all possession, because not even the property in severalty of the soil can be obtained, without some exertion to acquire and secure the possession; while labour is also required to obtain possession of its minerals, or of the produce which grows uncultivated, or the animals which are reared wild. All wealth, therefore, all objects of necessary use, of convenience, of enjoyment, are either created or fashioned, or in some way obtained, by human labour. The first inquiry then, which presents itself, relates to the powers of labour; the next to the distribution of its produce. These two subjects are treated in the first book of the Wealth of Nations,' in eleven chapters, to which is added a kind of appendix, called by the author a 'Digression, upon Money Prices,' or as he terms it, "the variations in the value of silver, and the variations in the real prices of commodities." The unskilful and even illogical aspect of this division is manifest; for under the head of labour, are comprehended the subjects of profit and rent as well as wages. But subject to this objection against the arrangement, and to the still more material objection which may be urged against one portion of the doctrine, the first book is of very great value, and unfolds at length the fundamental principles of econo

mical science.

i. The first sub-division relating to the powers of

labour, embraces the subject of its division and its price; the former is treated of in the three first chapters; the latter in the fifth and eighth, but also occasionally in the sixth, seventh, and tenth.

1. The division of labour, both increases its productive powers, and increases the excellence of its produce. Men will work more when their attention is confined to a single operation, than when it is distracted by several, because time is saved by not passing from one thing to another, and because the power or skill of the workman is increased when he has but one thing to occupy him. But independent of his increased skill making him do more work, it makes him perform better the work which he does, and hence both the quantity is augmented, and the quality is improved of what his labour produces. The origin of this division is the principle which makes men exchange or barter their different possessions, and among these their dif ferent powers. Either one differs from another in his capacity, or each by confining his attention to a single pursuit, acquires a peculiar capacity for that pursuit. In either case, they who are differently qualified will employ themselves differently, and one will exchange the produce of his labour with the other for the produce of his; or, which is the same thing, each will work for the other, and both will thus be better served. The extent of the market will always fix a limit to the division of labour, which can have no great range in confined situations; but where it is much divided, a vast multitude of workmen will concur in producing a single article of exchange. Dr. Smith mentions the case of eighteen persons being employed in making a pin, and being thus enabled to make 86,000 pins in a day, or 4,800 each person; whereas had they worked alone, perhaps they might not have been able to make one a-piece. He adds, that the meanest individual of a civilized country uses, or commands, in some small portion at least, the labour of many thousands, and is

thus better accommodated than a savage chief, who wholly possesses 10,000 slaves, and has their lives and liberties at his disposal. Among the beneficial effects, however, of the division of labour, one is to save labour by different contrivances, and especially by the invention of machinery. This in many instances, though by no means in all, improves the quality of the article; in all cases, it increases its quantity. It therefore greatly augments the power of labour.

2. Labour is the measure of the exchangeable value of all commodities, because the possession of all is governed by labour; and in the case of exchanging one against another, the produce of the labour by which both were obtained is mutually given and received. But it is easier to compare two commodities with each other than either of them with labour as their common measure; not to mention that it is not easy to compare the different kinds of labour, as hard and easy working, skilful and unskilful, with one another. Hence, prices are generally estimated by the proportion which the commodities bear to one another. Labour is thus estimated as well as other commodities, in commodities, and its natural wages are the whole of its produce. But as each labourer seeks for employment, and as each employer is desirous of giving as little for labour as he can, therefore the competition of workmen for work enables the employer to obtain it at much less than the whole produce. When there is a superabundance of workmen and more hands than are wanted, the competition of workmen lowers their wages. When there is a scarcity of workmen and more work than hands to do it, the competition of employers raises wages. But, in all cases, except where a man labours for himself, less than the produce of the labour is paid to reward it, and the difference belongs to the employers.

It is most material to observe, first, that there is a tendency in the competition of workmen to lower their wages; secondly, that there is a point below which

P

wages cannot descend. Both these positions are founded on this: that the labourers are, generally speaking, persons wholly dependent on their labour. Therefore, in the first place, they cannot keep their labour out of the market when the demand for it is slack, as a man of property will keep his goods back when their price is low; and, in the second place, the labourer would cease to work if he could not earn enough to support himself in the manner in which persons of the lower order usually live, with a surplus for supporting his family, without which his race would be extinct. Hence there is a necessary connection between the wages of labour and the prices of the necessaries of life; and though the demand for work, compared with its supply, must regulate wages within certain limits, that is, between the lowest point to which they can fall and the highest to which they can rise, the latter point depends upon the demand, the former upon the cost of maintaining the labourer and his family. This will not vary with each variation of the prices of necessaries; indeed, a scarcity, by throwing hands out of employment, may even lower wages instead of raising them. But upon the average price of necessaries the amount of wages certainly does and must depend; for, if the average price is high, some proportion must be kept by wages, else the workman would either perish or emigrate, and so labour would leave the market, until its recompense became equal to the cost of living; and again, if the average is low, the competition of workmen and the increase of their numbers by the progress of population will bring down the price, that is the wages, to the level of prices; so that the average rate of wages never can be much beyond the cost of living, that is, it must fall towards the average price of the necessaries of life.

We may here stop to observe how soon we are brought, by discussing speculations on the foundations of labour and value, or real prices, to the very practi