Unlessacapitalwasemployedintransportingeithertherudeormanufacturedproducefromtheplaceswhereitaboundstothosewhereitiswanted，nomoreofeithercouldbeproducedthanwasnecessaryfortheconsumptionoftheneighbourhood。Thecapitalofthemerchantexchangesthesurplusproduceofoneplaceforthatofanother，andthusencouragestheindustryandincreasestheenjoymentsofboth。
Unlessacapitalwasemployedinbreakinganddividingcertainportionseitheroftherudeormanufacturedproduceintosuchsmallparcelsassuittheoccasionaldemandsofthosewhowantthem，everymanwouldbeobligedtopurchaseagreaterquantityofthegoodshewantedthanhisimmediateoccasionsrequired。Iftherewasnosuchtradeasabutcher，forexample，everymanwouldbeobligedtopurchaseawholeoxorawholesheepatatime。Thiswouldgenerallybeinconvenienttotherich，andmuchmoresotothepoor。Ifapoorworkmanwasobligedtopurchaseamonth’sorsixmonths’provisionsatatime，agreatpartofthestockwhichheemploysasacapitalintheinstrumentsofhistrade，orinthefurnitureofhisshop，andwhichyieldshimarevenue。hewouldbeforcedtoplaceinthatpartofhisstockwhichisreservedforimmediateconsumption，andwhichyieldshimnorevenue。Nothingcanbemoreconvenientforsuchapersonthantobeabletopurchasehissubsistencefromdaytoday，orevenfromhourtohour，ashewantsit。Heistherebyenabledtoemployalmosthiswholestockasacapital。Heisthusenabledtofurnishworktoagreatervalue，andtheprofit，whichhemakesbyitinthisway，muchmorethancompensatestheadditionalpricewhichtheprofitoftheretailerimposesuponthegoods。Theprejudicesofsomepoliticalwritersagainstshopkeepersandtradesmenarealtogetherwithoutfoundation。Sofarisitfrombeingnecessaryeithertotaxthemortorestricttheirnumbersthattheycanneverbemultipliedsoastohurtthepublic，thoughtheymaysoastohurtoneanother。
Thequantityofgrocerygoods，forexample，whichcanbesoldinaparticulartownislimitedbythedemandofthattownanditsneighbourhood。Thecapital，therefore，whichcanbeemployedinthegrocerytradecannotexceedwhatissufficienttopurchasethatquantity。Ifthiscapitalisdividedbetweentwodifferentgrocers，theircompetitionwilltendtomakebothofthemsellcheaperthanifitwereinthehandsofoneonly;andifitweredividedamongtwenty，theircompetitionwouldbejustsomuchthegreater，andthechanceoftheircombiningtogether，inordertoraisetheprice，justsomuchtheless。Theircompetitionmightperhapsruinsomeofthemselves;buttotakecareofthisisthebusinessofthepartiesconcerned，anditmaysafelybetrustedtotheirdiscretion。Itcanneverhurteithertheconsumerortheproducer;onthecontrary，itmusttendtomaketheretailersbothsellcheaperandbuydearerthanifthewholetradewasmonopolizedbyoneortwopersons。Someofthem，perhaps，maysometimesdecoyaweakcustomertobuywhathehasnooccasionfor。Thisevil，however，isoftoolittleimportancetodeservethepublicattention，norwoulditnecessarilybepreventedbyrestrictingtheirnumbers。Itisnotthemultitudeofale—houses，togivethemostsuspiciousexample，thatoccasionsageneraldispositiontodrunkennessamongthecommonpeople;butthatdispositionarisingfromothercausesnecessarilygivesemploymenttoamultitudeofale—houses。
Thepersonswhosecapitalsareemployedinanyofthosefourwaysarethemselvesproductivelabourers。Theirlabour，whenproperlydirected，fixesandrealizesitselfinthesubjectorvendiblecommodityuponwhichitisbestowed，andgenerallyaddstoitspricethevalueatleastoftheirownmaintenanceandconsumption。Theprofitsofthefarmer，ofthemanufacturer，ofthemerchant，andretailer，arealldrawnfromthepriceofthegoodswhichthetwofirstproduce，andthetwolastbuyandsell。
Equalcapitals，however，employedineachofthosefourdifferentways，willimmediatelyputintomotionverydifferentquantitiesofproductivelabour，andaugment，too，inverydifferentproportionsthevalueoftheannualproduceofthelandandlabourofthesocietytowhichtheybelong。