reduced by accumulation.

But a country,

such as we are considering, engaged principally in manufactures, and unable to direct its industry to the same variety of pursuits, would sooner find its rate of profits diminished by an increase of capital, and no ingenuity in machinery could save it, after a certain period, from low profits and low wages, and their natural consequences, a check to population.

Thirdly, a country which is obliged to purchase both the raw materials of its manufactures and the means of subsistence for its population from foreign countries, is almost entirely dependent for the increase of its wealth and population on the increasing wealth and demands of the countries with which it trades.

It has been sometimes said that a manufacturing country is no more dependent upon the country which supplies it with food and raw materials, than the agricultural country is on that which manufactures for it; but this is really an abuse of terms. A country with great resources in land may find it decidedly for its advantage to em

ploy

ploy the main part of its capital in cultivation and to import its manufactures. In so doing, it will often employ the whole of its industry most productively, and most rapidly increase its stock. But, if the slackness of its neighbours in manufacturing, or any other cause, should either considerably check or altogether prevent the importation of manufactures, a country with food and raw materials provided at home cannot be long at a loss. For a time it would not certainly be so well supplied; but manufacturers and artisans would soon be found, and would soon acquire tolerable skill*; and though the capital and population of the country might not, under the new circumstances in which it was placed, increase so rapidly as before, it would still have the power of increasing in both to a great and almost undefinable extent.

On the other hand, if food and raw materials were denied to a nation merely manufacturing, it is obvious that it could not longer exist. But not only does the ab

This has been fully exemplified in America (1816).

solute

solute existence of such a nation, on an extreme supposition, depend upon its foreign commerce, but its progress in wealth must be almost entirely measured by the progress and demand of the countries which deal with it. However skilful, industrious and saving such a nation might be, if its customers, from indolence and want of accumulation, would not or could not take off a yearly increasing value of its commodities, the effects of its skill and machinery would be but of very short duration.

That the cheapness of manufactured commodities, occasioned by skill and machinery in one country, is calculated to encourage an increase of raw produce in others, no person can doubt; but we know at the same time that high profits may continue for a considerable period in an indolent and ill-governed state, without producing an increase of wealth; yet, unless such an increase of wealth and demand were produced in the surrounding countries, the increasing ingenuity and exertions of the manufacturing and commercial state would be lost in continually falling prices.

It would not only be obliged, as its skill and capital increased, to give a larger quantity of manufactured produce for the raw produce which it received in return; but it might be unable, even with the temptation of reduced prices, to stimulate its customers to such purchases as would allow of an increasing importation of food and raw materials; and without such an increasing importation, it is quite obvious that the population must become stationary.

It would come to the same thing, whether this inability to obtain an increasing quantity of food were occasioned by the advancing money price of corn or the falling money price of manufactures. In either case the effect would be the same; and it is certain that this effect might take place in either way, from increasing competition and accumulation in the manufacturing nation, and the want of them in the agricultural, long before any essential increase of difficulty had occurred in the production of corn.

Fourthly. A nation which is obliged to purchase from others nearly the whole of

its raw materials, and the means of its subsistence, is not only dependent entirely the demands of its customers, as they upon may be variously affected by indolence, industry or caprice, but it is subjected to a necessary and unavoidable diminution of demand in the natural progress of these countries towards that proportion of skill and capital which they may reasonably be expected after a certain time to possess. It is generally an accidental and temporary, not a natural and permanent, division of labour, which constitutes one state the manufacturer and the carrier of others. While, in these landed nations, agricultural profits continue very high, it may fully answer to them to pay others as their manufacturers and carriers; but when the profits on land fall, or the tenures on which it can be held are not such as to encourage the investment of an accumulating capital, the owner of this capital will naturally look towards commerce and manufactures for its employment; and, according to the just reasoning of Adam Smith and the Economists, finding at home both the materials

of