（2。iii。31）Itisequallyeasy，inthismodeofexpressionasintheformer，totranslatethe
language
ofsharesintothatofpercentage。Theamountoftheproduce，oritsexchangeablevalue，maybe
greater，ormaybeless，thantheamountofcapitalemployed。Ifthecapitalisallcirculating
capital，andconsumedintheprocessofproduction，andif，asinordinarylanguage，wesuppose
wagestobeincluded，theproduceisgreaterthanthecapital，bytheamountoftheprofits。Letus
supposethatthecapitalis500l。，andprofits10percent；thevalueoftheproduceis550l。；letus
supposethatofthisthecapitalistpays275l。inwages；inotherwords，thatthelabourers’shareis
50percent；itfollows，thattheshareofthecapitalistis50percentalso；but50percentof550l。
isagreateramountthan50percentofhiscapital，whichisonly500l。Thisisequalto55per
centuponhiscapital。Andwhenhehasdeductedfromhisshare，whatisnecessarytoreplacethe
portionofhiscapital，otherwiseconsumedthaninthepaymentofwages，viz。500l。—275l。=
225l。，hehas50l。remaining，or10percentuponhiscapital。
（2。iii。32）Letusnexttakethecaseinwhichthecapital500l。，asbefore，isallfixedcapital，
none
ofit，exceptingwhatisadvancedaswages，consumed；thatthisissmall，viz。25l。；andthatthe
valueofthecommodityis75l。；ofthis，25l。，or1/3istheshareofthelabourer；50l。，or2/3，is
theshareofthecapitalist；butthis，though66—1/2percentupontheproduct，isbut10percent
uponthecapital。
（2。iii。33）Thereisamodeofviewingthegrossreturntothecapitalist，whichhasatendency
to
simplifyourlanguage，and，sofar，hasagreatadvantagetorecommendit。Thecaseoffixedand
ofcirculatingcapitalmaybetreatedasthesame，bymerelyconsideringthefixedcapitalasa
product，whichisregularlyconsumedandreplaced，byeverycourseofproductiveoperations。
Thecapital，notconsumed，maybealwaystaken，asanadditionalcommodity，theresultofthe
productiveprocess。
（2。iii。34）Accordingtothissupposition，theshareofthecapitalistisalwaysequaltothe
wholeor
hiscapital，togetherwithitsprofits。
（2。iii。35）Wemayconsidercapitalintwosenses；first，asincluding；next，asexcluding，
wages。
（2。iii。36）Inthefirstcase，letussupposeacapital，of500l。，ofwhich100l。ispaidinwages，
to
produceacommodityworth550l。Theshareofthecapitalistis450l。orsomewhatmorethan
four—fifths，whilethatofthelabourersissomuchlessthanone—fifthandtheprofitofstock，after
replacingcapital，is10percent。
（2。iii。37）Letussuppose，inthesecondcase，acapitalor400l。，butexclusiveofwages。This
capitalisemployed，andthenecessarylabourersmaintainthemselveswithoutwages，andtake，
astheirremuneration，theirshareofthecommoditywhenproduced。Thecommodityisworth
550l。；andofthat100l。fallstotheshareofthelabourers。Therateofprofitsisthesameas
before，andtheproportionsarethesameasbefore，onlywiththiscorrection，thatintheformer
casethelabourerssustainedadiscountor10percentupontheirshareonaccountofanticipated
paymentTherealsharesinbothcasesarefour—fifthstothecapitalist，andone—fifthtothe
workmen。
（2。iii。38）Itissufficientlyevidentthat，solongasthecapitalandthelabourremainthesame，
and
thesharesremainthesame，solong，inMr。Ricardo’ssenseofthewordvalue，willthesame
valueaccruetoeach，whetherthequantityofproducetheyreceivebegreaterorless。
（2。iii。39）Thatthecapital，andthelabour，shouldremainthesame，isasnecessarya
condition，as
thatthesharesshouldremainthesame；forifeitherisincreasedordiminished，thevalueofthe
product，inMr。Ricardo’ssenseofthewordvalue，isalsoincreasedordiminished。
（2。iii。40）Thequantityofproducebeingsupposedthesame，wemayillustratethesubjectby
the
followingcases。
（2。iii。41）1。Letussupposethatbothcapitalandlabourarediminished，andinequal
proportions。
Thisispreciselythesamewiththecaseinwhichtheproductivepowersoflabourandcapitalare
increased；asitcomestothesamething，whetheryouhavethesameproducefromalesscostof
production，oragreaterproducefromthesamecostofproduction。Thiscase，therefore，hasbeen
alreadyconsidered。
（2。iii。42）2。Letussuppose，thatthecapitalisdiminished，thelabournot。Thisalsoisacase
of
diminishedcostofproduction。If，fortheproduceof550yardsofcloth，whichwasatfirst
effectedbyacapitalof400yardsandaportionoflabourwhichwaspaidbyafifthofthe
produce，onlyacapitalof200yardsshouldberequired，butthesamequantityofimmediate
labour；thatthelabourersmayhavethesameshareasbefore，itisnecessarythattheyshould
haveagreateraliquotpart。Suppose，beforethatincreaseofproductivepowerwhichissupposed
inthiscase，whenacapitalof400yardswasrequiredforaproduceof550，andwhenthewages
ofthequantityoflabourappliedwas110yards，thatanothercommodityhadbeenproducedby
thesamequantityorlabour，butbyacapitalof200yards。Thevalueofthiscommoditywould
havebeen330yards，equaltothecapitalwithitsprofitsandthewages。Ofthisthelabourers
wouldhavereceived110yards，orone—third。Thisisthesameproportiontoacapitalof200
yards，asone—fifthistoacapitalof400yards。Ifthelabourcontributedone—fifthtotheproduct
of550yards，whenaidedbyacapitalof400yards，itcontributesone—third，inthenewly
supposedcase，whenaidedbyacapitalof200yards。One—thirdof550is1831/3；leavingtothe
capitalist366—2/3，oraprofituponhiscapitalof83—1/3percent。Accordingtotheexplanation，
whichwehavealreadygivenandrepeated，thereishereanadditionalproducetoeach，byreason
oftheincreaseofproductivepower；and，also，whichisonlythesamethinginotherwords，an
augmentedvalueinexchange。ButinMr。Ricardo’ssenseofthewordvalue，thereisonlythe
samevaluetoeach，solongastheproportionsremainunchanged。
（2。iii。43）ThecaseswhichIhavethusputforillustration，arecasesinwhichtheproductive
powersoflabourandcapitalareaugmented；butasthesamereasoningsapply，mutatismutandis，
tothecasesinwhichtheproductivepowersarediminished，itisdeemedunnecessarytolengthen
thisanalysisbyadducingthem。
（2。iii。44）Itmayherebeusefultothelearnertolookback，andascertainthenumberand
importanceofthestepswhichhehasadvanced。Hehasdiscovered，whatarethelaws，according
towhichthosecommodities，whichformtherichesofnations，areproduced；andwhatarethe
laws，accordingtowhich，whenproduced，theyaredistributed。
（2。iii。45）Hehasseenthattherearetwoinstrumentsofproduction；oneprimary，theother
secondary：thatlabouristheprimaryinstrumentofproduction，andthat，abstractedfromthose
aidswhichitderivesfromcapital，itsproductivepowersareaugmentedchieflybylimitingthe
numberofeachman’sproductiveoperations；inotherwords，bywhathasbeencalledthe
divisionoflabour：thatcapitalissecondarytolabour，notonlybecauseitissubsequentinorder
oftime，butbecauseitowesitsexistencetolabour；becausethefirstcapitalistheresultofpure
labour，andbecausethatwhichissubsequentlytheresultoflabourandcapitalcombined，may
thenceberesolvedintolabour，theultimateprincipleofallproduction。
（2。iii。46）Thelearnerhasnowalsoseen，that，whatisproduced，bytheoperationsoflabour
and
capital，dividesitself，inthefirstinstance，intothreeportions；therentofland；thewagesof
labour；andtheprofitsofstock。Tillthelawswerediscovered，whichdeterminetheboundaries
oftheseseveralportions，thatwhichgoesasrent，thatwhichgoesasprofits，andthatwhichgoes
aswages，almostalltheconclusionsofPoliticalEconomywerevagueanduncertain。Ithasbeen
seen，thatrentissomethingwhichmaybeconsideredindependentofthegeneralresultorthe
productivepowersoflabourandcapital；thatitistheresultofapeculiardefectoftheearth，
whichdoesnotcontinuetoyielditsproduceinequalabundancetosuccessiveportionsof
capital；andthatitistheexcessofwhatisyieldedtothemoreproductiveportions，abovewhatis
equaltotheproduceoftheleastproductiveportionofcapitalemployedupontheland。Afterthe
limitswerethusfixedofthisoneofthethreeportions，intowhichtheproduceofindustry
dividesitself，whenceitappearedthatwhatmayberegardedasthegenuineeffectoflabourand
capitalinco—operationislefttobedividedbetweenthelabourerandthecapitalist；itwaseasy
forthelearnertosee，that，inrespecttoproportions，aswhatfelltotheshareoftheonewas
increased，whatwenttotheshareoftheotherwasdiminished，andthatinthissense，wagesand
profitsdependononeanother；thatinrespect，however，tothequantityofproducewhichthese
sharesmaycontain，theproductivepoweroftheinstrumentsofproductionisthedetermining
cause。
Chapter3。InterchangeSectionI。NatureoftheAdvantageDerivedfromthe
InterchangeofCommodities，andthePrincipalAgentsEmployedinit。
（3。i。1）Whentwomenhavemorethantheyneed；one，forexample，offood；another，of
cloth；
whilethefirstdesiresmoreofcloththanhepossesses，thesecondmoreoffood；itisagreat
accommodationtoboth，iftheycanperformanexchangeofapartofthefoodoftheonefora
partoftheclothoftheother；andsoinothercases。
（3。i。2）Inperformingexchanges，therearetwosetsofpersons，theinterventionofwhomisof
greatadvantage：thefirstareCarriers，thesecondMerchants。
（3。i。3）Whenthedivisionanddistributionoflabourhasbeencarriedtoanyconsiderable
extent，
goodsareproducedatsome，oftenataveryconsiderable，distancefromtheplacewheretheyare
wantedforconsumption。Itisnecessarythattheyshouldbeconveyedfromtheoneplacetothe
other。Carriersareoftwosorts：CarriersbyLand，andCarriersbyWater。Forthebusinessof
carriage，bothcapitalandlabourarerequired。Incarriagebyland，thewaggonsorcarts，the
horsesorothercattle，andthemaintenancebothofthemandofthenecessarynumberofmen；in
carriagebywater，theships，andthemaintenanceofthemenwhonavigatethem，constitutethe
capitalrequired。
（3。i。4）Toprocurearticles，asmenhaveoccasiontoconsumethem，itwouldbevery
inconvenienttorepair，ineachinstance，totherespectivemanufacturersandproducers，whomay
oftenliveataveryconsiderabledistancefromoneanother。Greattroubleissavedtoconsumers，
whentheyfindassembledinoneplacethewhole，oranyconsiderableportion，ofthearticles
whichtheyuse。Thisconveniencegivesrisetotheclassofmerchants，whobuyfromthe
manufacturers，andkeepreadyforuse，allthosearticlesforwhichtheyexpectaprofitablesale。
（3。i。5）Insmalltowns，whereoneorafewmerchantscansupplythewantsofallthe
population，
theshoporstoreofonemerchantcontainsarticlesofall，ormostofthekinds，ingeneral
demand。Inplaceswherethepopulationislarge，insteadofagreatnumberofshops，each
dealinginalmostallkindsofarticles，itisfoundmoreconvenienttodividethearticlesinto
classes，andthateachshopshouldconfineitselftoaparticularclass：one，forexample，tohats，
anothertohosiery；onetoglass，anothertoiron；andsoon。
SectionII。WhatDeterminestheQuantityinWhich
CommoditiesExchangeforOneAnother（3。ii。1）Whenacertainquantityofonecommodityisexchangedforacertainquantityof
another
commodity；acertainquantityofcloth，forexample，foracertainquantityofcorn；thereis
somethingwhichdeterminestheowneroftheclothtoacceptforitsuchandsuchaquantityof
corn；and，inlikemanner，theownerofthecorntoacceptsuchandsuchaquantityofcloth。
（3。ii。2）Thisis，evidently，theprincipleofdemandandsupply，inthefirstinstance。Ifagreat
quantityofcorncomestomarkettobeexchangedforcloth，andonlyasmallquantityofclothto
beexchangedforcorn，agreatquantityofcornwillbegivenforasmallquantityofcloth。Ifthe
quantityofcloth，whichthuscomestomarket，isincreased，withoutanyincreaseinthequantity
ofcorn，thequantityofcornwhichisexchangedforagivenquantityofclothwillbe
proportionallydiminished。
（3。ii。3）Thisanswer，however，doesnotresolvethewholeofthequestion。Thequantityin
which
commoditiesexchangeforoneanotherdependsupontheproportionofsupplytodemand。Itis
evidentlythereforenecessarytoascertainuponwhatthatproportiondepends。Whatarethelaws
accordingtowhichsupplyisfurnishedtodemand，isoneofthemostimportantinquiriesin
PoliticalEconomy。
（3。ii。4）Demandcreates，andthelossofdemandannihilates，supply。Whenanincreased
demand
arisesforanycommodity，anincreaseofsupply，ifthesupplyiscapableofincrease，follows，as
aregulareffect。Ifthedemandforanycommodityaltogetherceases，thecommodityisnolonger
produced。
（3。ii。5）Theconnexionhere，orcausesandeffects，iseasilyexplained。Ifcornisbroughtto
market，thecostofbringingithasbeensomuch。Ifclothisbroughttomarket，thecostof
bringingithasbeensomuch。Forthebenefitofsimplicity，thenumberofcommoditiesinthe
marketisheresupposedtobetwo：itisofnoconsequence，withregardtotheresult，whether
theyareunderstoodtobefewormany。
（3。ii。6）Thecostofbringingthecorntomarkethasbeeneitherequaltothatofbringingthe
cloth，
orunequal。Ifithasbeenequal，thereisnomotive，tothosewhobringtheclothorthecorn，for
alteringthequantityofeither。Theycannotobtainmoreofthecommoditywhichtheyreceivein
exchange，bytransferringtheirlabourtoitsproduction。Ifthecosthasbeenunequal，there
immediatelyarisesamotiveforalteringtheproportions。Supposethatthecostofbringing，the
wholeofthecornhasbeengreaterthanthatofbringingthewholeofthecloth；andthatthe
wholeoftheoneisexchangedagainstthewholeoftheother，eitheratonce，orinparts：the
personswhobroughttheclothhaveinthatcasepossessedthemselvesofaquantityofcornat
lesscost，thanthatatwhichitwasbroughttomarket，bythosewhoproducedit；those，onthe
otherhand，whobroughtthecornhavepossessedthemselvesofaquantityofcloth，atagreater
costthanthatatwhichitcanbemadeandbroughttomarket。
（3。ii。7）Heremotivesarise，todiminishthequantityofcorn，andincreasethequantityof
cloth；
becausethemenwhohavebeenproducingcorn，andpurchasingcloth，canobtainmorecloth，by
transferringtheirmeansofproductionfromtheonetotheother。Assoon，again，asnomore
clothcanbeobtainedbyapplyingthesameamountofmeanstotheproductionofcloth，thanby
applyingthemtocorn，andexchangingitforcloth，allmotivetoalterthequantityoftheoneas
comparedwiththatoftheotherisatanend。Nothingistobegainedbyproducingcornrather
thancloth，orclothratherthancorn。Thecostofproductiononbothsidesisequal。
（3。ii。8）Itthusappearsthattherelativevalueofcommodities，orinotherwords，thequantity
of
onewhichexchangesforagivenquantityofanother，dependsupondemandandsupply，inthe
firstinstance；butuponcostofproduction，ultimately；andhence，inaccuratelanguage，upon
costofproduction，entirely。Anincreaseordiminutionofdemandorsupply，maytemporarily
increaseordiminish，beyondthepointofproductivecost，thequantityofonecommoditywhich
exchangesforagivenquantityofanother；butthelawofcompetition，whereveritisnot
obstructed，tendsinvariablytobringittothatpoint，andtokeepitthere。
（3。ii。9）Costofproduction，then，regulatestheexchangeablevalueofcommodities。Butcost
of
productionisitselfinvolvedinsomeobscurity。
（3。ii。10）Twoinstrumentsarecommonlycombinedinproduction；LabourandCapital。
（3。ii。11）Itfollows，eitherthatcostofproductionconsistsinlabourandcapitalcombined；or
that
oneofthesemayberesolvedintotheother。Ifoneofthemcanberesolvedintotheother，it
followsthatcostofproductiondoesnotconsistinbothcombined。
（3。ii。12）Theopinion，whichissuggestedbyfirstappearances，undoubtedlyis，thatcostof
productionconsistsincapitalalone。Thecapitalistpaysthewagesofhislabourer，buystheraw
material，andexpectsthatwhathehasexpendedshallbereturnedtohim，intheprice，withthe
ordinaryprofitsuponthewholeofthecapitalemployed。Fromthisviewofthesubject，itwould
appear，thatcostofproductionconsistsexclusivelyintheportionofcapitalexpended，together
withtheprofitsuponthewholeofthecapitalemployedineffectingtheproduction。
（3。ii。13）Itiseasy，however，tosee，thatinthetermcapital，thusunderstood，anambiguity，
and
henceafallacy，isinvolved。Whenwesaythatcapitalandlabour，thetwoinstrumentsof
production，belongtotwoclassesofpersons；wemeanthatthelabourershavecontributedso
muchtotheproduction，andthecapitalistssomuch；andthatthecommodity，whenproduced，
belongsincertainproportionstoboth。Itmaysohappen，however，thatoneofthesepartieshas
purchasedtheshareoftheother，beforetheproductioniscompleted。Inthatcase，thewholeof
thecommoditybelongstothepartywhohaspurchasedtheshareoftheother。Inpointoffact，it
doeshappen，thatthecapitalist，asoftenasheemployslabourers，bythepaymentofwages，
purchasestheshareofthelabourers。Whenthelabourersreceivewagesfortheirlabour，without
waitingtobepaidbyashareofthecommodityproduced，itisevidentthattheyselltheirtitleto
thatshare。Thecapitalististhentheowner，notofthecapitalonly，butofthelabouralso。Ifwhat
ispaidaswagesisincluded，asitcommonlyis，inthetermcapital，itisabsurdtotalkoflabour
separatelyfromcapital。Thewordcapital，asthusemployed，includeslabourandcapitalboth。To
say，therefore，thattheexchangeablevalueofcommoditiesisdeterminedbycapital，understood
inthissense，istosaythatitisdeterminedbylabourandcapitalcombined。This，however，is
returningtothepointfromwhichwesetout。Itisnugatorytoincludelabourinthedefinitionof
thewordcapital，andthentosaythat，capitalwithoutlabour，determinesexchangeablevalue。If
capitalisunderstoodinasensewhichdoesnotincludethepurchasemoneyoflabour，andhence
thelabouritself，itisobviousthatcapitaldoesnotregulatetheexchangeablevalueof
commodities。
（3。ii。14）Iflabourwerethesoleinstrumentofproduction，andcapitalnotrequired，the
produce
ofoneday’slabourinonecommoditywouldexchangeagainsttheproduceofoneday’slabourin
anothercommodity。Intherudestateofsociety，ifthehunterandthefishermandesiredtovary
theirfood，theonebyaportionofgame，theotherbyaportionoffish，theaveragequantity
whichtheytookinadaywouldformthestandardofexchange。Ifitdidnot，oneofthetwo
wouldbeplacedinamoreunfavourablesituationthanhisneighbour，withperfectpower，which
hewouldofcourseemploy，topassfromtheonesituationtotheother。
（3。ii。15）Inestimatingequalquantitiesoflabour，anallowancewould，ofcourse，beincluded
for
differentdegreesofhardnessandskill。Iftheproductsofeachoftwodays’labourofequal
hardnessandskillexchangedforoneanother，theproductofaday’slabour，whichwaseither
harder，orrequiredagreaterdegreeofskill，wouldexchangeforsomethingmore。
（3。ii。16）Allcapitalconsistsreallyincommodities。Thecapitalofthefarmerisnotthe
money
whichhemaybeworth，becausethathecannotapplytoproduction。Hiscapitalconsistsinhis
implementsandstock。
（3。ii。17）Asallcapitalconsistsincommodities，itfollows，ofcourse，thatthefirstcapital
must
havebeentheresultofpurelabour。Thefirstcommoditiescouldnotbemadebyany
commoditiesexistingbeforethem。
（3。ii。18）Butifthefirstcommodities，andofcoursethefirstcapital，weretheresultof’pure
labour，thevalueofthiscapital，thequantityofothercommoditiesforwhichitwouldexchange，
musthavebeenestimatedbylabour。Thisisanimmediateconsequenceofthepropositionwhich
wehavejustestablished，thatwherelabourwasthesoleinstrumentofproduction，exchangeable
valuewasdeterminedbythequantityoflabourwhichtheproductionofthecommodityrequired。
（3。ii。19）Ifthisbeestablished，itisanecessaryconsequence，thattheexchangeablevalueof
all
commoditiesisdeterminedbyquantityoflabour。
（3。ii。20）Thefirstcapital，ashasjustbeenseen，beingtheresultofpurelabour，bearsavalue
in
proportiontothatlabour。Thiscapitalconcursinproduction。Anditiscontendedthatassoonas
capitalconcursinproduction，thevalueofthecommodityproducedisdeterminedbythevalue
ofthecapital。Butthevalueofthatcapitalitself，wehavejustobserved，isdeterminedbylabour。
Tosay，therefore，thatthevalueofaproductisdeterminedbythevalueofthecapital，isofno
use，whenyouhavetogobeyondthevalueofthecapital，andask，whatitisbywhichthatvalue
isitselfdetermined。Tosaythatthevalueoftheproductisdeterminedbythevalueofthe
capital，butthevalueofthecapitalisdeterminedbythequantityoflabour，istosaythatthe
valueoftheproductisdeterminedbythequantityoflabour。
（3。ii。21）Itthusundeniablyappears，thatnotonlythevalueofthefirstcapital，but，byequal
necessity，thatofthecommoditieswhichareproducedbythefirstcapital，isdeterminedby
quantityoflabour。Capitalofthesecondstagemustconsistinthecommoditieswhichare
producedbythatofthefirststage。Itmust，therefore，beestimatedbythequantityoflabour。The
samereasoningappliestoitineverysubsequentstage。Thevalueofthefirstcapitalwas
regulatedbyquantityoflabour：thevalueofthatwhichwasproducedbythefirstcapitalwas
regulatedbythevalueofthefirst：that，however，wasvaluedbylabour：thelast，therefore，is
valuedbylabour；andsoon，withoutend，asoftenassuccessiveproductionsmaybesupposedto
bemade。But，ifthevalueofallcapitalmustbedeterminedbylabour，itfollows，uponall
suppositions，thatthevalueofallcommoditiesmustbedeterminedbylabour。
（3。ii。22）Tosay，indeed，thatthevalueofcommoditiesdependsuponcapital，impliesoneof
the
mostobviousofallabsurdities。Capitaliscommodities。Ifthevalueofcommodities，then，
dependsuponthevalueofcapital，itdependsuponthevalueofcommodities；valueinshort
dependsuponvalue。Thisisnotanexpositionofvalue。Itisanattemptclearlyandcompletely
abortive。
（3。ii。23）Itthusappears，thatquantityoflabour，inthelastresort，determinestheproportion
in
whichcommoditiesexchangeforoneanother。
（3。ii。24）Thereisonephenomenonwhichisbroughttocontroverttheseconclusions，and
which
itis，therefore，necessarytoexplain。
（3。ii。25）Itissaidthattheexchangeablevalueofcommoditiesisaffectedbytime，without
the
interventionoflabour；because，whenprofitsofstockmustbeincluded，somuchmustbeadded
foreveryportionoftimewhichtheproductionofonecommodityrequiresbeyondthatof
another。Forexample，ifthesamequantityoflabourhasproducedinthesameseasonacaskof
wine，and20sacksofflour，theywillexchangeagainstoneanotherattheendoftheseason：but
iftheownerofthewineplacesthewineinhiscellar，andkeepsitforacoupleofyears，itwillbe
worthmorethanthe20sacksofflour，becausetheprofitsofstockforthetwoyearsmustbe
addedtotheoriginalprice。Hereisanadditionofvalue，buthereitisaffirmed，therehasbeenno
newapplicationoflabour；quantityoflabour，therefore，isnottheprinciplebywhich
exchangeablevalueisregulated。
（3。ii。26）Thisobjectionisfoundeduponamisapprehensionwithrespecttothenatureof
profits。
Profitsare，inreality，themeasureofquantityoflabour；andtheonlymeasureofquantityof
labourtowhich，inthecaseofcapital，wecanresort。Thiscanbeestablishedbyrigidanalysis。
（3。ii。27）Iftwocommoditiesareproduced，abaleofsilk，forexample，forimmediate
consumption，andamachine，whichisanarticleoffixedcapital；itiscertain，thatifthebaleof
silkandthemachinewereproducedbythesamequantityoflabour，andinthesametime，they
wouldexactlyexchangeforoneanother：quantityoflabourwouldclearlybetheregulatorof
theirvalue。
（3。ii。28）Butsupposethattheownerofthemachine，insteadofsellingit，isdisposedtouse
it，for
thesakeoftheprofitswhichitbrings；whatistherealcharacterandnatureofhisaction？Instead
ofreceivingthepriceofhismachineallatonce，hetakesadeferredpayment，somuchper
annum：hereceives，infact，anannuity，inlieuofthecapitalsum；anannuity，fixedbythe
competitionofthemarket，andwhichisthereforeanexactequivalentforthecapitalsum。
Whatevertheproportionwhichthecapitalsumbearstotheannuity，whetheritbetenyears’
purchase，ortwentyyears’purchase，suchaproportioniseachyear’sannuityoftheoriginalvalue
ofthemachine。Theconclusion，therefore，isincontrovertible：astheexchangeablevalueofthe
machine，haditbeensoldassoonasmade，wouldhavebeenthepracticalmeasureofthe
quantityoflabouremployedinmakingit，one—tenthorone—twentiethofthatvaluemeasuresalso
atenthoratwentiethofthequantityoflabour。
（3。ii。29）Ifapieceofmachinery，whichhascost100days’labour，isappliedinmakinga
commodity，andiswornoutinthemakingofit；andif100days’purelabourareemployedin
makinganothercommodity；theproduceofthemachine，andtheproduceofthelabour，
supposingnoadjustmentnecessaryfordifferenceoftime，willexchangeagainstoneanother。
（3。ii。30）Makenowadifferentsupposition：thatthemachineisanarticleoffixedcapital，
andnot
wornout，andletustracetheconsequences。Itwascorrectlysupposed，intheformercase，that
100days’labourwereexpendedbywearingoutthemachine；but100days’labourhavenotbeen
expendedinthesecond，becausethemachineisnotwornout。Somelabour，however，hasbeen
expended，because100days’labourinamasshasbeenapplied。Howmuchofitshallwesayhas
beenexpended？Wehaveanexactmeasureofitintheequivalentwhichispaid。Iftheequivalent
whichwasobtainedwhenthemachinewaswornout，wasameasureof100days’labour，
whateverproportionofsuchequivalentisreceivedasayear’suseofthemachinewhennotworn
out，mustrepresentacorrespondingproportionofthelabourexpendeduponthemachine。
（3。ii。31）CapitalisallowedtobecorrectlydescribedunderthetitleofhoardedLabour。A
portion
ofcapitalproducedby100days’labour，is100days’hoardedlabour。Butthewholeofthe100
days’hoardedlabourisnotexpended，whenthearticleconstitutingthecapitalisnotwornout。A
partisexpended，andwhatpart？Ofthiswehavenodirect，wehaveonlyanindirectmeasure。If
capital，paidforbyanannuity，ispaidforattherateof10percent，one—tenthoftheboarded
labourmaybecorrectlyconsideredasexpendedinoneyear。
（3。ii。32）Theinstancewhichiscommonlyadducedasexemplifyingthesupposedfactofan
increaseofvaluewithoutincreaseoflabour，isthatofwine。Wineacquiresagreatervalueby
beingmerelydepositedinthecellarsofthemerchant。
（3。ii。33）Buttheywhowouldadvancethis，asananswertotheantecedentreasoning，donot
perceivetheforceoftheirownobjection。Theirdoctrineis，thatexchangeablevalueisregulated
bycostofproduction。Costofproductionistheoutlaynecessaryforcompletingtheproduct。
Whenthewinewasputintothecellar，itwasworthsomuch，accordingtothecapitalexpended
initsproduction。Whenitisplacedinthecellar，nomorecapitalisemployeduponit，norany
morelabour；andyetitacquiresanadditionalvalue。Thequestion，whyitacquiresmorevalue，
whenthereisnotmorecapital，isjustasdifficult，aswhyitacquiresmorevalue，whenthereis
notmorelabour。
（3。ii。34）Itisnosolutiontosay，thatprofitsmustbepaid；becausethisonlybringsustothe
question，whymustprofitsbepaid？Tothisthereisnoanswerbutone，thattheyarethe
remunerationforlabour；labournotappliedimmediatelytothecommodityinquestion，but
appliedtoitthroughthemediumofothercommodities，theproduceoflabour。Thusamanhasa
machine，theproduceof100days’labour。Inapplyingit，theownerundoubtedlyapplieslabour，
thoughinasecondarysense，byapplyingthatwhichcouldnot—havebeenhadbutthroughthe
mediumoflabour。Thismachine，letussuppose，iscalculatedtolastexactly10years。Onetenth
ofthefruitsof100days’labouristhusexpendedeveryyear；whichisthesamethingintheview
ofcostandvalue，assayingthat10days’labourhavebeenexpended。Theowneristobepaidfor
the100days’labourwhichthemachinecostshim，attherateofsomuchperannum，thatis，by
anannuityfortenyears，equivalenttotheoriginalvalueofthemachine。Itthusappearsthat
profitsaresimplyremunerationforlabour。Theymay，indeed，withoutdoinganyviolenceto
language，hardlyevenbyametaphor，bedenominatedwages：thewagesofthatlabourwhichis
applied，notimmediatelybythehand，butmediately，bytheinstrumentswhichthehandhas
produced。Andifyoumaymeasuretheamountofimmediatelabourbytheamountofwages，
youmaymeasuretheamountofsecondarylabourbythatofthereturntothecapitalist。We
surelyhavenotoccasiontoadd，thatifthisbethegeneralaccountofprofits，whichseems
undeniable，itisapplicabletoallparticularcases，tothatofwineinthecellar，aswellastoevery
other。Supposethat100menmakeamachineinoneday，thatanother100menemploythis
machinethenextday，andwearitout；thefirst100men，andthesecond100men，willdividethe
produceequallybetweenthem。Theshareofthefirst100menispaymentforcapital，nodoubt，
butitisalso，mostobviously，paymentforlabourtoo；andinwhateverdegreelabouris
productive，thatis，yieldsmorethanisconsumedineffectingtheproduct，tothatdegreean
advantageisaffordedbeyondthereplacingofthecapitalconsumed，andconstitutesprofit。
（3。ii。35）Thereturnwhichismadetocapitalemployedupontheland，isthatwhich
determines
therateofannualprofitfromallotheremploymentsofcapital；and，ofcourse，forthatwhichis
employedinmelioratingwineinawine—cellar。Thecaseofthewineinthecellarcoincides
exactlywiththatofamachinewornoutinayear，whichworksbyitselfwithoutadditional
labour。Thenewwine，whichisonemachine，isreplacedbyitsproduce，theoldwine，withthat
additionofvaluewhichcorrespondswiththereturntocapitalemployedupontheland；andthe
accountwhichistoberenderedoftheonereturn，isalsothetrueaccountoftheother。
SectionIII。EffectUponExchangeableValuesofaFluctuation
inWagesandProfits。
（3。iii。1）Instatingthatcommoditiesareproducedbytwoinstruments，LabourandCapital，of
whichthelastistheresultoflabourwe，ineffect，mean，thatcommoditiesareproducedbytwo
quantitiesoflabour，differentlycircumstanced；theone，immediate，orprimarylabour，that
whichisappliedatoncebythehandofthelabourer；theother，hoarded，orsecondarylabour，
thatwhichistheresultofformerlabour，andeitherisappliedinaidoftheimmediatelabour，or
isthesubjectmatteruponwhichitisbestowed。
（3。iii。2）Ofthesetwospeciesoflabour，twothingsaretobeobserved：First，thattheyarenot
alwayspaidaccordingtothesamerate；thatis，thepaymentoftheonedoesnotrisewhenthatof
theotherrises，orfallwhenthatoftheotherfalls：And，secondly，thattheydonotalways
contributetotheproductionofallcommoditiesinequalproportions。
（3。iii。3）Iftherewereanytwospeciesoflabour，thewagesofwhichdidnotriseandfallin
the
sameproportion，andwhich，contributingtotheproductionofallcommodities，didnot
contributetothemallinequaldegrees，thiscircumstance，oftheirnotcontributinginequal
degrees，wouldcreateadifferenceinexchangeablevalues，asoftenasanyfluctuationtookplace
intherateofwages。
（3。iii。4）Ifallcommoditieswereproducedbyaportionofskilled，andaportionofunskilled
labour，buttheratiowhichtheseportionsboretooneanotherweredifferentindifferent
commodities；andif，asoftenasthewagesofskilledlabourrose，thewagesofunskilledlabour
rosetwiceasmuch；itisveryobvious，that，uponariseofwages，thosecommodities，tothe
productionofwhichagreaterproportionofunskilledlabourwasapplied，wouldriseinvalueas
comparedwiththosetowhichalessproportionwasapplied。Itisalsoobvious，that，thoughthis
differenceintheratiosaccordingtowhichthewagesofthetwokindsoflabourhadaltered，and
intheproportionsinwhichtheywereappliedtotheproductionofdifferentcommodities，would，
uponariseorfallinwages，altertherelativevalueofthecommodities，itwoulddoso，without
intheleastdegreeaffectingthetruthoftheproposition，thatquantityoflabourdetermined
exchangeablevalues。
（3。iii。5）Thecaseispreciselythesamewhenweconsiderthatitisthetwospeciesoflabour，
calledprimaryandsecondary，whichareappliedindifferentproportions。
（3。iii。6）Threecaseswillconvenientlyexemplifythedifferentdegreesinwhichlabourand
capitalrespectivelycontributetoproduction。Thesearethetwoextremecases，andthemedium。
Thefirstisthatofcommoditieswhichareproducedbyimmediatelabouralonewithoutcapital；
thesecond，thatofcommoditiesproduced，onehalfbycapital，onehalfbyimmediatelabour；
thethird，thatofcommoditiesproducedbycapitalalonewithoutimmediatelabour。Thereare
perhapsnoactualcaseswhichperfectlycoincidewitheitheroftheextremes。Thereare，
however，caseswhichapproximatetoboth；andwhenthemostsimpleareillustratedas
examples，allowancecaneasilyandcorrectlybemadeforthedifferencesoftherest。
（3。iii。7）Iftwospeciesoflabourareemployedintheproductionofcommodities；andif，
when
thepaymentoftheonespeciesoflabourrises，thatoftheotherfalls；acommodity，inthe
productionofwhichagreaterproportionofthefirstspeciesoflabourisemployed，will，upona
riseinthepaymentofthatspeciesoflabour，riseinexchangeablevalue，ascomparedwitha
commodityinwhichlessisemployed。Thedegreehowever，inwhichitwillrise，willdepend
upontwocircumstances：first，uponthedegreeinwhichthepaymentoftheonespeciesoflabour
fallswhentheotherrises；and，secondly，uponthedegreeinwhichtheproportionofthelabour
ofthefirstkind，employedinitsproduction，exceedstheproportionofitwhichisemployedin
theproductionoftheothercommodity。
（3。iii。8）Thefirstquestionthen，is，inwhatdegree，whenwagesrise，doprofitsfall？Andthis
is
theonlygeneralquestion；forthedegreeinwhichthetwospeciesoflabourcombineinthe
productionofdifferentcommodities，dependsuponthecircumstancesofeachparticularcase。
（3。iii。9）Ifallcommoditiescorrespondedwiththefirstofthecases，assumedaboveas
examples，
andwhichwemay，forthesakeofabbreviation，designate，asNo。1，No。2，No。3；inother
words，ifallcommoditieswereproducedwhollybylabour，capitalbeingsolelyemployedinthe
paymentofwages；inthatcase，justasmuchaswagesoflabourrose，profitsofstockwouldfall。
（3。iii。10）Supposeacapitalof1000l。tobethusemployed，andprofitstobe10percent。，the
valueofthecommoditywouldbe1100l。，forthatwouldreplacethecapitalwithitsprofits。The
commoditymayberegardedasconsistingof1100parts，ofwhich1000wouldbelongtothe
labourers，and100tothecapitalist。Letwages，uponthis，besupposedtorise5percent。；inthat
case，itisevident，thatinsteadof100partsofthe1100，thecapitalistwouldreceiveonly50；his
profits，therefore，insteadof10wouldbeonly5percent。Insteadof1000l。Hewouldhaveto
pay1050l。inwages。Thecommoditywouldnotriseinvaluetoindemnifyhim，becausewehave
supposedthatallcommoditiesareinthesamesituation；itwould，therefore，beofthevalueof
1100l。，asbefore，ofwhich50l。alonewouldremainforhimself。
（3。iii。11）IfallcommoditiescorrespondedwiththecaseNo。2，profitswouldfallonlyhalfas
muchaswagesrose。Ifwesupposethat1000l。werepaidinwages，and1000l。employedin
fixedcapital；thatprofits，asbefore，were10percent。，andthisthewholeexpenditure；thevalue
ofthecommoditywouldbe1200l。becausethatisthesumwhichwouldreplacethecapital
expendedandpaytheprofitsofthewhole。Inthiscasethecommoditymightbeconsideredas
dividedinto1200parts，ofwhich200wouldbelongtothecapitalist。Ifwagesrose5percent。，
andinsteadof1000l。aswages，hepaid1050l。hewouldstillretain150l。asprofits；inother
words，hewouldsustainareductionofonly2—1/2percent。
（3。iii。12）Thecasewouldbepreciselythesame，ifwesupposedthe1000l。ofcapital，which
is
notemployedinthepaymentofwages，tobeemployedinanyproportion，intheshapeof
circulatingcapitalconsumedinthecourseoftheproductiveprocess，andrequiringtobe
replaced。Thus，while1000l。wereemployedinthepaymentofwages，500l。mightbeemployed
asfixedcapitalindurablemachinery，500l。inrawmaterialandotherexpenses。Ifthiswerethe
stateoftheexpenditure，thevalueofthearticlewouldbe1700l。；beingtheamountofthe
capitaltobereplaced，and10percent。profitsuponthewhole。Ofthese1700parts，1000would
betheshareofthelabourers，thoughpaidinadvance，and700theshareofthecapitalist，200
beingprofits。If，now，wagesweretorise5percent。，1050oftheabove1700partswouldbethe
shareofthelabourers，and650onlywouldremaintothecapitalist，ofwhich，afterreplacinghis
500l。ofcirculatingcapital，150wouldremainasprofits；areductionof2—1/2percent。asbefore。
（3。iii。13）Ifallcommoditiescorrespondedwiththethirdcase，asnowageswouldbepaid，
profits
couldnotbeaffectedbytheriseofthem：anditisobvious，that，inproportionascommodities
maybesupposedtoapproachthatextreme，profitswouldbelessandlessaffectedbysucharise。
（3。iii。14）Ifwesuppose，whatismostprobable，that，intheactualstateofthings，asmany
cases
areontheonesideofthemediumasontheother，theresultwouldbe，inconsequenceofthe
mutualcompensationsthatwouldtakeplace，thatprofitswouldbereducedexactlyhalfasmuch
aswagesrose。
（3。iii。15）Thestepsmaybetracedasfollows：
（3。iii。16）Whenwagesrise，andprofitsfall，itisevidentthatallcommodities，madewitha
less
proportionoflabourtocapital，willfallinvalue，ascomparedwiththosewhicharemadewitha
greater。Thus，ifNo。1istakenasthestandard，thatinwhichcommoditiesareproducedwholly
bylabour；allcommoditiesbelongingtothatcasewillbesaidtoremainofthesamevalue；all
belongingtoanyoftheothercaseswillbesaidtofallinvalue。IfNo。2istakenasthestandard，
allcommoditiesappertainingtothatcasewillbesaidtoremainofthesamevalue；all，belonging
toanycasenearerthefirstextreme，willbesaidtoriseinvalue；all，toanynearerthelast
extreme，tofall。
（3。iii。17）Thosecapitalists，whoproducearticlesofcaseNo。1，sustain，whenwageshave
risen5
percent。，anadditionalcostof5percent。；buttheyexchangetheircommodityagainstother
commodities。IftheyexchangethemagainstthoseofcaseNo。2，wherethecapitalistshave
sustainedanadditionalcostofonly2—1/2percent。，theywillreceive2—1/2percent。additional
quantity。Thus，inobtaininggoods，producedunderthecircumstancesofcaseNo。2，theyobtain
acertaindegreeofcompensation，andsustain，bytheriseofwages，adisadvantageofonly2—1/2
percent。Inthisexchange，however，theresult，withrespecttothecapitalistswhoproducegoods
underthecircumstancesofcaseNo。2，isreversed。Theyhavealreadysustainedadisadvantage
of2—1/2percent。，intheproductionoftheirgoods，andaremadetosustainanotherdisadvantage
of2—1/2percent。inobtaining，byexchangethegoodsproducedunderthecircumstancesofcase
No。1。
（3。iii。18）Theresult，then，uponthewhole，is，thatallproducers，whopossessthemselves，
either
byproductionorexchange，ofgoodsproducedunderthecircumstancesofcaseNo。2，sustaina
disadvantageof2—1/2percent。；thosewhopossessthemselvesofgoodsincasesapproachingthe
firstextreme，sustainagreater；thoseincasesapproachingthelast，alessdisadvantage：that，if
thecasesontheonesideareequaltothoseontheother，alossofpercent。issustaineduponthe
whole；thatthis，accordingly，istheextenttowhich，inpractice，itmaybesupposedthatprofits
arereduced。
（3。iii。19）Fromtheseelementsitiseasytocomputetheeffectofariseofwagesuponprice。
All
commoditiesarecomparedwithmoney，orthepreciousmetals。Ifmoneybesupposedto
correspondwithcaseNo。2，ortobeproduced，whichisprobablynotfarfromthefact，byequal
proportionsoflabourandcapital；thenallcommodities，producedunderthesemedium
circumstances，arenotalteredinpricebyariseofwages；thosecommoditieswhichapproach
nearerthefirstextreme，oradmitagreaterproportionoflabourthancapitalintheirformation，
riseinprice：thosewhichapproachthesecond，thatis，haveagreaterportionofcapitalthan
labour，fall：and，upontheaggregateofcommoditiesoralltakentogether，thereisneitherfall
norrise。
（3。iii。20）Fromtheexplanations，hereafforded，itwillbeeasytoseewhatismeantbythe
term
\"measureofvalue，\"andwhereinitdiffersfromthatwhichwehavealreadyendeavouredto
explain，the\"regulatorofvalue。\"
（3。iii。21）Money，thatis，thepreciousmetalsincoin，servespracticallyasameasureof
value，as
isevidentfromwhathasimmediatelybeensaid。Acertainquantityofthepreciousmetalistaken
asaknownvalue，andthevalueofotherthingsismeasuredbythatvalue；onecommodityis
twice，anotherthricethevalueofsuchaportionofthemetal，andsoon。
（3。iii。22）Itisevident，however，thatthiscanremainanaccuratemeasureofvalue，onlyifit
remainsofthesamevalueitself。Ifacommodity，whichwastwicethevalueofanounceof
silver，becomesthreetimesitsvalue，wecanonlyknowwhatchangehastakenplaceinthevalue
ofthiscommodity，ifweknowthatourmeasureisunchanged。
（3。iii。23）Butthereisnocommoditytobetakenasameasureofvalue，whichisnotitself
liable
toalterationsinvalue，orinitspowerofpurchasing，fromachangeinthequantityoflabourand
capitalrequiredbothforitsownproduction，andthatofothercommodities，andalsofroma
changeinwagesandprofits。
（3。iii。24）Thealterationofvalue，arisingfromachangeinthequantityoflabourrequiredfor
production，isthemostimportant；forifwecouldbesure，thatthecommoditychosenforour
measureofvaluewasitselfalwaysproducedunderthesamecircumstances，thatis，bythesame
quantityofimmediate，andthesamequantityofhoarded，labour，itwouldalwaysanswerthe
followingpurposes：1st，itwouldshow，byeveryalterationinitspowerofpurchasinga
commodityproducedbythesameproportionoflabourandcapital，thealterationwhichhad
takenplaceinthecostofproductionofthatcommodity，orinthatbywhichitsvalueis
regulated：and2dly，itmightbeaccommodatedbycalculationtothechangesinvalue，produced
bythealterationofwagesandprofits，inthecaseofcommoditiesnotproducedbythesame
proportionsoflabourandcapital。
（3。iii。25）Thus，ifgoldwereproducedunderthecircumstancesofcaseNo。1，bymere
labour，
pickedup，forexample，bythehand，fromthebedsofrivers，andalwaysinequalquantity，in
returnforanequalquantityoflabour，itwouldalwaysbeameasure，exactlyandimmediately，of
allcommoditiesproducedbypurelabour。Inthecase，however，ofariseofwages，andafallin
theprofitsofstock，goldwouldinthesecircumstancesriseascomparedwithcommodities
producedunderthecircumstancesofcaseNo。2，thoughnoalterationshouldhavetakenplacein
theamountofthelabourandcapitalrequiredfortheirproduction。Itisevident，therefore，thatin
thesecircumstances，gold，fluctuatinginvaluewitheveryfluctuationinthewagesoflabour，
wouldveryimperfectlyservethepurposesofameasureofvalue。Ifacontract，forexample，
weremade，topayanannuityofsomuchgoldfortwentyyears，itmightbe10percent。more，or
10percent。less，attheendofthatperiod，thanitwasatthebeginning。Oflabouritwouldallthe
timecommandexactlythesamequantity，butofallcommoditiesproducedbyaidofcapitalit
wouldcommandadifferentquantity，andthat，inproportiontothedegreeinwhichcapital，not
labour，wastheinstrumentoftheirproduction。
（3。iii。26）Thoughwecanbystrictanalysisdiscover，thatexchangeablevalueisproportioned
to
quantityoflabourexpendedinproduction，therearethreecircumstanceswhichpreventits
applicationasthemeasureofvalue。
（3。iii。27）Inthefirstplace，therearetwokindsoflabouremployedinproduction，andthe
degree
inwhichtheproduceissharedbetweenthemoftenvaries，andoccasionsaswehaveseen，a
correspondingvariationintheexchangeablevaluesof’commoditiesproducedbydifferent
proportionsofthesetwokindsoflabour。Inthenextplace，wehavenopracticalmeansof
ascertainingbeforehandtheexactquantityofhoardedlabourwhichgoestoproduction，since
theonlymeasurewehaveofitsquantityisthepricewhichitbrings。Inthethirdplace，labouris
notconstantinitsproductivepowers。Ifoneday’slabourproducedalwaysthesamequantityof
gold，butnotthesamequantityofcorn，orofcloth，theexchangeablevalueofgoldwouldalter
inrespecttocornandcloth。
（3。iii。28）Fromtheseexplanationsitalsoappears，thatnothingelsecanbeappliedasan
accurate
measureofvalue。
（3。iii。29）Everycommoditymaybeconsideredasproducedunderoneofthethreesetsof
circumstancesspecifiedabove。Ifwetakeasourmeasureacommodity，producedunderthe
circumstancesNo。1，thegold，forexample，pickedupbythehand，thiswillalwayspurchasethe
samequantityofpurelabour，andofsuchcommoditiesasareproducedbythesamequantityof
thatlabour；butitwillnotpurchasethesamequantityofcommoditieswhichcometoneedmore
orlessoflabour，northesamequantityoftheproduceofhoardedlabour，butlessofitin
proportionaswagesrise，moreaswagesfall。Couldwetakeasourmeasureacommodity
producedunderthecircumstancesNo。3，thatis，byhoardedlabouralone，itwouldalways
purchasethesamequantityoftheproduceofhoardedlabour，whennoalterationhadtakenplace
initsproductivepowers，butlessormoreoftheproduceofimmediatelabour，accordingas
profits，thewagesofhoardedlabour，roseorfell。Acommodity，producedunderthemedium
circumstances，answersthepurposebest；becausebyfarthegreaternumberofcommoditiesare
producedundercircumstancesmorenearlyapproachingtothemediumthananyoftheextremes。
Gold，therefore，whichisproducedinthesecircumstances，andwithlessvariationinthequantity
ofthetwokindsoflabourappliedtoitsproduction，thanalmostanyothercommodity，hasthis
recommendationamongothers，tobethemediumofexchange，thatitislessimperfectasa
measureofvaluethanalmostanyothercommodity，whichcouldbetaken。Suchaberrationsas
areobvious，andcapableofbeinginsomedegreeforeseen，practicalsagacitycorrectsbythe
properallowances。Thiscannotbedonewhengreatandunexpectedchangestakeplace；and
muchdisorderistheconsequence。
SectionIV。OccasionsonWhichitistheInterestofNationsto
ExchangeCommoditieswithOneAnother（3。iv。1）Wehavealreadyseen，thatthebenefits，derivedfromthedivisionandskilful
distribution
oflabour，formpartofthemotiveswhichgiverisetotheexchangeofcommodities。Menwill
notconfinethemselvestotheproductionofoneonlyofthevariousarticleswhichcontributeto
thewell—beingoftheindividual，unlesstheycan，byitsmeans，providethemselveswithothers。
（3。iv。2）Thereisanothercircumstance，whichveryobviouslyaffordsamotivetoexchange
commodities。Somecanbeproducedonlyinparticularplaces。Metals，coals，andvariousother
commoditiesofthegreatestimportance，aretheproductofcertainspots。Thesameisthecase
withsomevegetableproductions，towhicheverysoilandclimatearenotadapted。Certain
commodities，thoughnotconfinedtoparticularspots，canyetbemoreconvenientlyandcheaply
producedinsomeplacesthaninothers；commodities，forexample，whichrequireagreat
consumptionoffuel，inacoalcountry；commodities，themanufactureofwhichrequiresastrong
movingpower，whereasufficientfallofwatercanbeobtained；commoditieswhichrequirean
extraordinaryproportionofmanuallabour，whereprovisions，andconsequentlylabour，are
cheap。