The course of human prosperity, indeed,
seems scarce ever to have been of so long continuance
as to enable any great country to acquire
capital sufficient for all those three purposes;
unless, perhaps, we give credit to the
wonderful accounts of the wealth and cultivation
of China, of those of ancient Egypt,
and of the ancient state of Indostan. Even
those three countries, the wealthiest, according
to all accounts, that ever were in the world,
are chiefly renowned for their superiority in
agriculture and manufactures. They do not
appear to have been eminent for foreign trade.
The ancient Egyptians had a superstitious antipathy
to the sea; a superstition nearly of the
same kind prevails among the Indians; and
the Chinese have never excelled in foreign
commerce. The greater part of the surplus
produce of all those three countries seems to
have been always exported by foreigners, who
gave in exchange for it something else, for
which they found a demand there, frequently
gold and silver.
It is thus that the same capital will in any
country put into motion a greater or smaller
quantity of productive labour, and add a
greater or smaller value to the annual produce
of its land and labour, according to the
different proportions in which it is employed
in agriculture, manufactures, and wholesale
trade. The difference, too, is very great, according
to the different sorts of wholesale
trade in which any part of it is employed.
All wholesale trade, all buying in order to
sell again by wholesale, may be reduced to
three different sorts: the home trade, the foreign
trade of consumption, and the carrying
trade. The home trade is employed in purchasing
in one part of the same country, and
selling in another, the produce of the industry
of that country. It comprehends both the inland
and the coasting trade. The foreign
trade of consumption is employed in purchasing
foreign goods for home consumption. The
carrying trade is employed in transacting the
commerce of foreign countries, or in carrying
the surplus produce of one to another.
The capital which is employed in purchasing
in one part of the country, in order to
sell in another, the produce of the industry of
that country, generally replaces, by every such
operation, two distinct capitals, that had both
been employed in the agriculture or manufactures
of that country, and thereby enables
them to continue that employment. When it
sends out from the residence of the merchant
a certain value of commodities, it generally
brings back in return at least an equal value
of other commodities. When both are the
produce of domestic industry, it necessarily
replaces, by every such operation, two distinct
capitals, which had both been employed in
supporting productive labour, and thereby enables
them to continue that support. The
capital which sends Scotch manufactures to
London, and brings back English corn and
manufactures to Edinburgh, necessarily replaces,
by every such operation, two British
capitals, which had both been employed
in the agriculture or manufactures of Great
Britain.
The capital employed in purchasing foreign
goods for home consumption, when this purchase
is made with the produce of domestic
industry, replaces, too, by every such operation,
two distinct capitals; but one of them
only is employed in supporting domestic industry.
The capital which sends British goods
to Portugal, and brings back Portuguese goods
to Great Britain, replaces, by every such operation,
only one British capital. The other is
a Portuguese one. Though the returns, therefore,
of the foreign trade of consumption,
should be as quick as those of the home trade,
the capital employed in it will give but one
half the encouragement to the industry or
productive labour of the country.
But the returns of the foreign trade of consumption
are very seldom so quick as those
of the home trade. The returns of the home
trade generally come in before the end of the
year, and sometimes three or four times in
the year. The returns of the foreign trade
of consumption seldom come in before the end
of the year, and sometimes not till after two
or three years. A capital, therefore, employed
in the home trade, will sometimes make twelve
operations, or be sent out and returned twelve
times, before a capital employed in the foreign
trade of consumption has made one. If
the capitals are equal, therefore, the one will
give four-and-twenty times more encouragement
and support to the industry of the country
than the other.
The foreign goods for home consumption
may sometimes be purchased, not with the
produce of domestic industry, but with some
other foreign goods. These last, however,
must have been purchased, either immediately
with the produce of domestic industry, or
with something else that had been purchased
with it; for, the case of war and conquest
excepted, foreign goods can never be acquired,
but in exchange for something that had been
produced at home, either immediately, or after
two or more different exchanges. The effects,
therefore, of a capital employed in such a
round-about foreign trade of consumption,
are, in every respect, the same as those of one
employed in the most direct trade of the same
kind, except that the final returns are likely
to be still more distant, as they must depend
upon the returns of two or three distinct foreign
trades. If the hemp and flax of Riga
are purchased with the tobacco of Virginia,
which had been purchased with British manufactures,
the merchant must wait for the
returns of two distinct foreign trades, before
he can employ the same capital in repurchasing
a like quantity of British manufactures.