if he should happen to be deceived, he knows
better the laws of the country from which he
must seek redress. In the carrying trade, the
capital of the merchant is, as it were, divided
between two foreign countries, and no part of
it is ever necessarily brought home, or placed
under his own immediate view and command.
The capital which an Amsterdam merchant
employs in carrying corn from Koningsberg
to Lisbon, and fruit and wine from Lisbon
to Koningsberg, must generally be the one
half of it at Koningsberg, and the other half
at Lisbon. No part of it need ever come to
Amsterdam. The natural residence of such
a merchant should either be at Koningsberg
or Lisbon; and it can only be some very particular
circumstances which can make him
prefer the residence of Amsterdam. The uneasiness,
however, which he feels at being separated
so far from his capital, generally determines
him to bring part both of the Koningsberg
goods which he destines for the
market of Lisbon, and of the Lisbon goods
which he destines for that of Koningsberg, to
Amsterdam; and though this necessarily subjects
him to a double charge of loading and
unloading as well as to the payment of some
duties and customs, yet, for the sake of having
some part of his capital always under his
own view and command, he willingly submits
to this extraordinary charge; and it is in this
manner that every country which has any considerable
share of the carrying trade, becomes
always the emporium, or general market, for
the goods of all the different countries whose
trade it carries on. The merchant, in order
to save a second loading and unloading, endeavours
always to sell in the home market,
as much of the goods of all those different
countries as he can; and thus, so far as he
can, to convert his carrying trade into a foreign
trade of consumption. A merchant, in
the same manner, who is engaged in the foreign
trade of consumption, when he collects
goods for foreign markets, will always be
glad, upon equal or nearly equal profits, to
sell as great a part of them at home as he can.
He saves himself the risk and trouble of exportation,
when, so far as he can, he thus converts
his foreign trade of consumption into a
home trade. Home is in this manner the
centre, if I may say so, round which the capitals
of the inhabitants of every country are
continually circulating, and towards which
they are always tending, though, by particular
causes, they may sometimes be driven off and
repelled from it towards more distant employments.
But a capital employed in the home
trade, it has already been shown, necessarily
puts into motion a greater quantity of domestic
industry, and gives revenue and employment
to a greater number of the inhabitants
of the country, than an equal capital employed
in the foreign trade of consumption; and
one employed in the foreign trade of consumption
has the same advantage over an equal
capital employed in the carrying trade. Upon
equal, or only nearly equal profits, therefore,
every individual naturally inclines to
employ his capital in the manner in which it
is likely to afford the greatest support to domestic
industry, and to give revenue and employment
to the greatest number of people of
his own country.
Secondly, every individual who employs his
capital in the support of domestic industry,
necessarily endeavours so to direct that industry,
that its produce may be of the greatest
possible value.
The produce of industry is what it adds to
the subject or materials upon which it is employed.
In proportion as the value of this
produce is great or small, so will likewise be
the profits of the employer. But it is only
for the sake of profit that any man employs a
capital in the support of industry; and he
will always, therefore, endeavour to employ it
in the support of that industry of which the
produce is likely to be of the greatest value,
or to exchange for the greatest quantity either
of money or of other goods.
But the annual revenue of every society is
always precisely equal to the exchangeable value
of the whole annual produce of its industry,
or rather is precisely the same thing
with that exchangeable value. As every individual,
therefore, endeavours as much as he
can, both to employ his capital in the support
of domestic industry, and so to direct that industry
that its produce may be of the greatest
value; every individual necessarily labours to
render the annual revenue of the society as
great as he can. He generally, indeed, neither
intends to promote the public interest,
nor knows how much he is promoting it. By
preferring the support of domestic to that of
foreign industry, he intends only his own security;
and by directing that industry in such
a manner as its produce may be of the greatest
value, he intends only his own gain; and
he is in this, as in many other cases, led by
an invisible hand to promote an end which
was no part of his intention. Nor is it always
the worse for the society that it was no
part of it. By pursuing his own interest, he
frequently promotes that of the society more
effectually than when he really intends to promote
it. I have never known much good
done by those who affected to trade for the
public good. It is an affectation, indeed, not
very common among merchants, and very few
words need be employed in dissuading them
from it.
What is the species of domestic industry
which his capital can employ, and of which
the produce is likely to be of the greatest value,
every individual, it is evident, can in his
local situation judge much better than any
statesman or lawgiver can do for him. The
statesman, who should attempt to direct private