An Essay on Profits [2]
trading capital would also fall to thirty-six per cent. Thus by bringing successively land of a worse quality, or less favourably situated into cultivation, rent would rise on the land previously cultivated, and precisely in the same degree would profits fall; and if the smallness of profits do not check accumulation, there are hardly any limits to the rise of rent, and the fall of profit. If instead of employing capital at a distance on new land, an additional capital of the value of two hundred and ten quarters of wheat be employed on the first land cultivated, and its return were in like manner forty-three per cent or ninety on two hundred and ten; the produce of fifty per cent on the first capital, would be divided in the same manner as before forty-three per cent or eighty-six quarters would constitute profit, and fourteen quarters rent. If two hundred and twenty quarters were employed in addition with the same result as before, the first capItal would afford a rent of twenty-eight; and the second of fourteen quarters, and the profits on the whole capital of six hundred and thirty quarters would be equal, and would amount to thirty-six per cent. Supposing that the nature of man was so altered, that he required double the quantity of food that is now necessary for his subsistence, and consequently, that the expenses of cultivation were very greatly increased. Under such circumstances the knowledge and capital of an old society employed on fresh and fertile land in a new country would leave a much less surplus produce; consequently, the profits of stock could never be so high. But accumulation, though slower in its progress, might still go on, and rent would begin just as before, when more distant or less fertile land were cultivated. The natural limit to population would of course be much earlier, and rent could never rise to the height to which it may now do; because, in the nature of things, land of the same poor quality would never be brought into cultivation; -- nor could the same amount of capital be employed on the better land with any adequate return of profit.(4*) The following table is constructed on the supposition, that the first portion of land yields one hundred quarters profit on a capital of two hundred quarters; the second portion, ninety quarters on two hundred and ten, according to the foregoing calculations.(5*) It will be seen that during the progress of a country the whole produce raised on its land will Increase, and for a certain time that part of the produce which belongs to the profits of stock, as well as that part which belongs to rent will increase; but that at a later period, every accumulation of capital will be attended with an absolute, as well as a proportionate diminution of profits, -- though rents will uniformly increase. A less revenue, it will be seen, will be enjoyed by the owner of stock, when one thousand three hundred and fifty quarters are employed on the different qualities of land, than when one thousand one hundred were employed. In the former case the whole profits will be only two hundred and seventy, in the latter two hundred and seventy five; and when one thousand six hundred and ten are employed, profits will fall to two hundred and forty-one and a half.(6*) This is a view of the effects of accumulation which is exceedingly curious, and has, I believe, never before been noticed. It will be seen by the table, that, in a progressive country, rent is not only absolutely increasing, but that it is also increasing in its ratio to the capital employed on the land; thus when four hundred and ten was the whole capital employed, the landlord obtained three and a half per cent; when one thousand one hundred-thirteen and a quarter per cent; and when one thousand eight hundred and eighty-sixteen and a half per cent. The landlord not only obtains a greater produce, but a larger share.
TABLE, shewing the Progress of Rent and Profit under an assumed Augmentation of Capital
Capital estimated to quarters of wheat [200, 210, 220, 230, 240, 250, 260,
TABLE, shewing the Progress of Rent and Profit under an assumed Augmentation of Capital
Capital estimated to quarters of wheat [200, 210, 220, 230, 240, 250, 260,