The fixed capital, and that part of the circulating
capital which consists in money, so
far as they affect the revenue of the society,
bear a very great resemblance to one another.
First, as those machines and instruments of
trade, &c. require a certain expense, first to
erect them, and afterwards to support them,
both which expenses, though they make a
part of the gross, are deductions from the neat
revenue of the society; so the stock of money
which circulates in any country must require
a certain expense, first to collect it, and afterwards
to support it; both which expenses,
though they make a part of the gross, are, in
the same manner, deductions from the neat
revenue of the society. A certain quantity of
very valuable materials, gold and silver, and
of very curious labour, instead of augmenting
the stock reserved for immediate consumption,
the subsistence, conveniencies, and amusements
of individuals, is employed in supporting that
great but expensive instrument of commerce,
by means of which every individual in the society
has his subsistence, conveniencies, and
amusements, regularly distributed to him in
their proper proportions.
Secondly, as the machines and instruments
of trade, &c. which compose the fixed capital
either of an individual or of a society, make
no part either of the gross or of the neat revenue
of either; so money, by means of which
the whole revenue of the society is regularly
distributed among all its different members,
makes itself no part of that revenue. The
great wheel of circulation is altogether different
from the goods which are circulated by
means of it. The revenue of the society consists
altogether in those goods, and not in the
wheel which circulates them. In computing either
the gross or the neat revenue of any society,
we must always, from the whole annual circulation
of money and goods, deduct the whole
value of the money, of which not a single
farthing can ever make any part of either.
It is the ambiguity of language only which
can make this proposition appear either doubtful
or paradoxical. When properly explained
and understood, it is almost self-evident.
When we talk of any particular sum of
money, we sometimes mean nothing but the
metal pieces of which it is composed, and
sometimes we include in our meaning some
obscure reference to the goods which can be
had in exchange for it, or to the power of purchasing
which the possession of it conveys.
Thus, when we say that the circulating money
of England has been computed at eighteen
millions, we mean only to express the amount
of the metal pieces, which some writers have
computed, or rather have supposed, to circulate
in that country. But when we say that a
man is worth fifty or a hundred pounds a-year,
we mean commonly to express, not only the
amount of the metal pieces which are annually
paid to him, but the value of the goods
which he can annually purchase or consume;
we mean commonly to assertain what is or
ought to be his way of living, or the quantity
and quality of the necessaries and conveniencies
of life in which he can with propriety
indulge himself.
When, by any particular sum of money,
we mean not only to express the amount of
the metal pieces of which it is composed, but
to include in its signification some obscure reference
to the goods which can be had in exchange
for them, the wealth or revenue which
it in this case denotes, is equal only to one of
the two values which are thus intimated somewhat
ambiguously by the same word, and to the
latter more properly than to the former, to the
money's worth more properly than to the money.
Thus, if a guinea be the weekly pension of
a particular person, he can in the course of
the week purchase with it a certain quantity of
subsistence, conveniencies, and amusements.
In proportion as this quantity is great or
small, so are his real riches, his real weekly
revenue. His weekly revenue is certainly not
equal both to the guinea and to what can be
purchased with it, but only to one or other of
those two equal values, and to the latter more
properly than to the former, to the guinea's
worth rather than to the guinea.
If the pension of such a person was paid
to him, not in gold, but in a weekly bill for a
guinea, his revenue surely would not so properly
consist in the piece of paper, as in
what he could get for it. A guinea may be
considered as a bill for a certain quantity of
necessaries and conveniencies upon all the
tradesmen in the neighbourhood. The revenue
of the person to whom it is paid, does not
so properly consist in the piece of gold, as in
what he can get for it, or in what he can exchange
it for. If it could be exchanged for
nothing, it would, like a bill upon a bankrupt,
be of no more value than the most useless
piece of paper.
Though the weekly or yearly revenue of all
the different inhabitants of any country, in the
same manner, may be, and in reality frequently
is, paid to them in money, their real riches,
however, the real weekly or yearly revenue of
all of them taken together, must always be
great or small, in proportion to the quantity
of consumable goods which they can all of
them purchase with this money. The whole
revenue of all of them taken together is evidently
not equal to both the money and the
consumable goods, but only to one or other of
those two values, and to the latter more properly
than to the former.
Though we frequently, therefore, express a
person's revenue by the metal pieces which are
annually paid to him, it is because the amount
of those pieces regulates the extent of his
power of purchasing, or the value of the goods
which he can annually afford to consume.
We still consider his revenue as consisting in