in its own quantity, can never be an accurate
measure of the quantity of other things;
so a commodity which is itself continually varying
in its own value, can never be an accurate
measure of the value of other commodities.
Equal quantities of labour, at all times
and places, may be said to be of equal value
to the labourer. In his ordinary state of
health, strength, and spirits; in the ordinary
degree of his skill and dexterity, he must always
lay down the same portion of his ease,
his liberty, and his happiness. The price which
he pays must always be the same, whatever
may be the quantity of goods which he receives
in return for it. Of these, indeed, it
may sometimes purchase a greater and sometimes
a smaller quantity; but it is their value
which varies, not that of the labour which purchases
them. At all times and places, that is
dear which it is difficult to come at, or which
it costs much labour to acquire; and that
cheap which is to be had easily, or with very
little labour. Labour alone, therefore, never
varying in its own value, is alone the ultimate
and real standard by which the value of all
commodities can at all times and places be estimated
and compared. It is their real price;
money is their nominal price only.
But though equal quantities of labour are
always of equal value to the labourer, yet to
the person who employs him they appear sometimes
to be of greater, and sometimes of smaller
value. He purchases them sometimes with
a greater, and sometimes with a smaller quantity
of goods, and to him the price of labour
seems to vary like that of all other things. It
appears to him dear in the one case, and cheap
in the other. In reality, however, it is the
goods which are cheap in the one case, and
dear in the other.
In this popular sense, therefore, labour, like
commodities, may be said to have a real and
a nominal price. Its real price may be said to
consist in the quantity of the necessaries and
conveniencies of life which are given for it;
its nominal price, in the quantity of money.
The labourer is rich or poor, is well or ill rewarded,
in proportion to the real, not to the
nominal price of his labour.
The distinction between the real and the
nominal price of commodities and labour is
not a matter of mere speculation, but may
sometimes be of considerable use in practice.
The same real price is always of the same value;
but on account of the variations in the
value of gold and silver, the same nominal
price is sometimes of very different values.
When a landed estate, therefore, is sold with
a reservation of a perpetual rent, if it is intended
that this rent should always be of the
same value, it is of importance to the family
in whose favour it is reserved, that it should
not consist in a particular sum of money. Its
value would in this case be liable to variations
of two different kinds: first, to those which
arise from the different quantities of gold and
silver which are contained at different times
in coin of the same denomination; and, secondly,
to those which arise from the different
values of equal quantities of gold and silver
at different times.
Princes and sovereign states have frequently
fancied that they had a temporary interest
to diminish the quantity of pure metal contained
in their coins; but they seldom have
fancied that they had any to augment it. The
quantity of metal contained in the coins, I
believe of all nations, has accordingly been
almost continually diminishing, and hardly
ever augmenting. Such variations, therefore,
tend almost always to diminish the value of a
money rent.
The discovery of the mines of America diminished
the value of gold and silver in Europe.
This diminution, it is commonly supposed,
though I apprehend without any certain
proof, is still going on gradually, and is
likely to continue to do so for a long time.
Upon this supposition, therefore, such variations
are more likely to diminish than to
augment the value of a money rent, even
though it should be stipulated to be paid, not
in such a quantity of coined money of such a
denomination (in so many pounds sterling,
for example), but in so many ounces, either
of pure silver, or of silver of a certain standard.
The rents which have been reserved in
corn, have preserved their value much better
than those which have been reserved in money,
even where the denomination of the coin has
not been altered. By the 18th of Elizabeth,
it was enacted, that a third of the rent of all
college leases should be reserved in corn, to
be paid either in kind, or according to the
current prices at the nearest public market.
The money arising from this corn rent, though
originally but a third of the whole, is, in the
present times, according to Dr. Blackstone,
commonly near double of what arises from
the other two-thirds. The old money rents
of colleges must, according to this account,
have sunk almost to a fourth part of their ancient
value, or are worth little more than a
fourth part of the corn which they were formerly
worth. But since the reign of Philip
and Mary, the denomination of the English
coin has undergone little or no alteration, and
the same number of pounds, shillings, and
pence, have contained very nearly the same
quantity of pure silver. This degradation,
therefore, in the value of the money rents of
colleges, has arisen altogether from the degradation
in the price of silver.
When the degradation in the value of silver
is combined with the diminution of the quantity
of it contained in the coin of the same
denomination, the loss is frequently still greater.
In Scotland, where the denomination of
the coin has undergone much greater alterations