rate or in its value. A rent which consists
either in a certain proportion, or in a certain
quantity, of the rude produce, is no doubt affected
in its yearly value by all the occasional
and temporary fluctuations in the market
price of that rude produce; but it is seldom
affected by them in its yearly rate. In settling
the terms of the lease, the landlord and
farmer endeavour, according to their best
judgment, to adjust that rate, not to the temporary
and occasional, but to the average and
ordinary price of the produce.
Such fluctuations affect both the value and
the rate, either of wages or of profit, according
as the market happens to be either overstocked
or understocked with commodities or
with labour, with work done, or with work to
be done. A public mourning raises the price
of black cloth (with which the market is almost
always understocked upon such occasions),
and augments the profits of the merchants
who possess any considerable quantity of
it. It has no effect upon the wages of the
weavers. The market is understocked with
commodities, not with labour, with work done,
not with work to be done. It raises the
wages of journeymen tailors. The market is
here understocked with labour. There is an
effectual demand for more labour, for more
work to be done, than can be had. It sinks
the price of coloured silks and cloths, and
thereby reduces the profits of the merchants
who have any considerable quantity of them
upon hand. It sinks, too, the wages of the
workmen employed in preparing such commodities,
for which all demand is stopped for
six months, perhaps for a twelvemonth. The
market is here overstocked both with commodities
and with labour.
But though the market price of every particular
commodity is in this manner continually
gravitating, if one may say so, towards
the natural price; yet sometimes particular
accidents, sometimes natural causes, and sometimes
particular regulations of police, may, in
many commodities, keep up the market price,
for a long time together, a good deal above
the natural price.
When, by an increase in the effectual demand,
the market price of some particular
commodity happens to rise a good deal above
the natural price, those who employ their
stocks in supplying that market, are generally
careful to conceal this change. If it was
commonly known, their great profit would
tempt so many new rivals to employ their
stocks in the same way, that, the effectual demand
being fully supplied, the market price
would soon be reduced to the natural price,
and, perhaps, for some time even below
it. If the market is at a great distance
from the residence of those who supply it,
they may sometimes be able to keep the secret
for several years together, and may so
long enjoy their extraordinary profits without
any new rivals. Secrets of this kind, however,
it must be acknowledged, can seldom
be long kept; and the extraordinary profit
can last very little longer than they are kept.
Secrets in manufactures are capable of being
longer kept than secrets in trade. A dyer
who has found the means of producing a particular
colour with materials which cost only
half the price of those commonly made use of,
may, with good management, enjoy the advantage
of his discovery as long as he lives,
and even leave it as a legacy to his posterity.
His extraordinary gains arise from the high
price which is paid for his private labour.
They properly consist in the high wages of
that labour. But as they are repeated upon
every part of his stock, and as their whole
amount bears, upon that account, a regular
proportion to it, they are commonly considered
as extraordinary profits of stock.
Such enhancements of the market price are
evidently the effects of particular accidents, of
which, however, the operation may sometimes
last for many years together.
Some natural productions require such a
singularity of soil and situation, that all the
land in a great country, which is fit for producing
them, may not be sufficient to supply
the effectual demand. The whole quantity
brought to market, therefore, may be disposed
of to those who are willing to give more than
what is sufficient to pay the rent of the land
which produced them, together with the wages
of the labour and the profits of the stock which
were employed in preparing and bringing them
to market, according to their natural rates.
Such commodities may continue for whole
centuries together to be sold at this high price;
and that part of it which resolves itself into
the rent of land, is in this case the part which
is generally paid above its natural rate. The
rent of the land which affords such singular
and esteemed productions, like the rent of
some vineyards in France of a peculiarly happy
soil and situation, bears no regular proportion
to the rent of other equally fertile and
equally well cultivated land in its neighbourhood.
The wages of the labour, and the profits
of the stock employed in bringing such
commodities to market, on the contrary, are
seldom out of their natural proportion to those
of the other employments of labour and stock
in their neighbourhood.
Such enhancements of the market price are
evidently the effect of natural causes, which
may hinder the effectual demand from ever
being fully supplied, and which may continue,
therefore, to operate for ever.
A monopoly granted either to an individual
or to a trading company, has the same effect
as a secret in trade or manufactures. The
monopolists, by keeping the market constantly
understocked by never fully supplying the effectual
demand, sell their commodities much
above the natural price, and raise their emoluments,