book 2

, chap. iii.

In a wealthy country, the whole profits of its capital are infinitely greater than in one that is poor; although a given quantity of capital will, in a country of the latter description, produce profits much greater than in an opulent one--ibid.

It is industry that furnishes the produce; but it is economy that places in the capital that part of it which would otherwise have become revenue--ibid.

The economy of individuals arises from a principle which is universally diffused, and one that is continually in action; the desire of ameliorating their condition. This principle supports the existence and increase of national wealth, in spite of the prodigality of some individuals; and even triumphs over the profusion and errors of governments--ibid.

Of the different modes of spending money, some are more favourable than others to the increase of national wealth--ibid.

Those branches of employment which require a capital, never fail to call forth more or less labour; and thus contribute, in a greater or less degree, to increase the extent of national labour.

Capital can be employed only in four ways:

1. In cultivating and improving the earth, or, in other words, multiplying its rude produce;

2. In supporting manufactures;

3. In buying by the gross, to sell in the same manner;

4. In buying by the gross, to sell by retail.

These four modes of employing capital are equally necessary to, and serve mutually to support, each other. The first supports, beyond all comparison, the greatest number of productive hands; the second occupies more than the two remaining; and the fourth the fewest of any.

Capital may be employed, according to the third mode, in three different ways; each contributing in a very different degree to the support and encouragement of national industry.

When capital is employed in exchanging one description of the produce of national industry for another, it then supports as great a portion of industry as can be done by any capital employed in commerce.

When it is employed in exchanging the produce of national for that of foreign industry, for the purposes of home consumption, half of it goes to the support of foreign industry; by which means, it is only of half that service to the industry of the nation which it would have been had it been employed another way.

Lastly, when it is employed in exchanging one description of the produce of foreign industry for another, or in what is termed the _carrying trade_, it then serves wholly for the support and encouragement of the industry of the two foreign nations, and adds only to the annual produce of the country the profits of the merchant--