Principles of Political Economy, Vol. 1

by Wilhelm Roscher

Footnotes

[1.]The author's preface to the twelfth edition is confined to pointing out the improvements etc., made in the eleventh. There is no new preface to the thirteenth edition of the original, which appeared in 1877.—Translator.[2.]“We shall never thoroughly understand the reason of customary law unless we also have a knowledge of that which is not customary. The one is connected and bound to the other. We have no slaves; why vex ourselves with questions about slaves?—Words worthy of a novice.”[3.]“I am a man; I think nothing foreign to me that pertains to man.”[4.]“That excellent and glorious philosophy.”[5.]Introduction to the Civilistisches Magazin.[6.]Dunoyer, De la Liberté du Travail.[7.]Cicero, De Leg., I.[8.]Discours Préliminaire du Code Civil.[9.]Cicero, De Leg., II, 4. “Legem neque hominum ingeniis excogitatam, nec scitum aliquod esse populorum, sed æternum quiddam quod universum mundum regeret, imperandi, prohibendique sapientia.” Ibid.[10.]Revue de Législ. et de Jurispr. (1841, XIII, p. 39.) Montesquieu says: “The relations of justice and equity are anterior to all positive laws.”[11.]Mr. Wolowski translated the second edition of Roscher's Principles into French, and prefixed the present essay thereto as a preface. Since Wolowski's translation appeared, the original work has gone through eleven editions, been largely increased in size, and enriched with new notes, the result of nearly twenty additional years of research and thought. The thirteenth German edition, from which the present translation is made, is larger than the first by one hundred and seventy pages.—Translator's note.[12.]

And he adds: “Animals which yield only to an impulse or blind instinct, come together only fortuitously or periodically and in a manner destitute of all morality. But in the case of men, reason is mixed up more or less with every act of their lives. Sentiment is found side by side with desire, and right succeeds instinct. I discover a real contract in the union of the two sexes.”

It would be impossible to present a more complete or eloquent refutation of the definition of the Roman jurisconsults which debases marriage to the level of the promiscuous coming together of animals, and which limits the natural law to the law common to man and beast. “Jus naturale est quod natura omnia animalia docuit; nam jus istud non humani generis proprium, sed omnium animalium quæ in terra, quæ in mare nascuntur, avium quoque commune est. Hinc descendit maris atque feminæ conjunctio, quam nos matrimonium appellamus, hinc liberorum procreatio, hinc educatio; videmus etenim cætera quoque animalia, feras etiam, istius juris peritia censeri.” D. L. I. De Just. et Jure.

In one of his latest productions (Ueber die sogennante historische und nicht historische Rechtsschule, Archives du Droit Civil, Heidelberg, XXI 1838) the veteran of the philosophical school, resuming a debate begun a quarter of a century before, energetically defends himself against the erroneous interpretations which it was sought to give to his thoughts. “Does it follow,” he inquires, “that because a man is desirous of reform, he must surrender the study of the past? And if there be new laws to construe, how could his evil genius deter him from the necessary knowledge of ancient laws? Is there a single jurisconsult, who, in the hope of a better future, despises the meaning and spirit of that which still exists? I do not know even one.... And when I am accused of passing by the institutions of the past with coldness and hatred in my heart, because I was one of the first to express the hope of a better future, a charge is laid at my door which is perfectly incomprehensible ... I am reproached with despising the history of law. It is a slander on me. Although I have only laughed at these reports, one man's mistake grieved me; for that man's name was Niebuhr.... When he [Niebuhr] returned from Italy to devote himself entirely to science, in his retreat at Bonn, he passed through Heidelberg, where he remained five or six days. During a great part of that time we came frequently together. He was at first a little cold; but Cicero made us friends. After a happy word let drop concerning that writer, he asked me what I thought of him. I answered laconically: ‘If they were burning all the Latin authors, and I were permitted to grant a pardon to one of them, I should say, without hesitation: Spare the works of Cicero.’ He joyfully exclaimed: ‘I have at last found a man who judges rightly of Cicero. I share your admiration for him, and that is the reason I have given my boy the name of Marcus.’ The ice was now broken, and he frankly told me that he could not understand how I could be an inveterate enemy of Roman law and of the history of law. I gave him to understand that I had simply been slandered, and I added, that, in order to live entirely with the classics, I had always refused to give legal advice, or act as a counsellor, although I might have made a fortune in that way. I told him that I owed my gayety and vigor, in great part, to my love for the classics of all ages, even those outside the domain of jurisprudence; but that I held, above all things, to the good qualities of the German nation, and that I did not hesitate to say with Facciolatus: ‘Expedit omnes gentes Romanis legibus operam dare, suis vivere.’

“When he heard those words of mine, he exclaimed with his usual energy and vivacity: ‘Habes me consentientem, labes me consentientem.’ From that moment all coldness between us was at an end, and we approached, without any embarrassment, a host of questions in one conversation in which I endeavored, as I had before, to learn from him.

“Thus I receive with sincere gratitude, all the works, both useful and profound, which have appeared in our day on the history of law. It would be folly in me to deny the impetus which the study of positive law has received. New sources have been discovered. Their newness and importance have excited the zeal of many scholars who have studied them profoundly; a fact which made a review of the older sources, still by far the most important, necessary. These two circumstances soon rendered it imperative to proceed to the making of scrupulous dogmatic researches. Thus there now is a new life among jurisconsults, and a great activity, which, it is my hope, may continue long.”

Roscher's complete work he calls “A System of Political Economy.” It embraces the four parts above referred to; but each of these parts constitutes an independent work. The first part, or the Principles of Political Economy, covers the ground generally covered by English treatises on Political Economy.

Besides the works above mentioned, Professor Roscher has written Ansichten der Volkswirthschaft aus dem geschichtlichen Standpunkte, 2d ed., Leipzig, 1861; Die deutche Nationalökonomik an der Grenzscheide des sechszehnten und siebenzehnten Jahrhunderts, Leipzig, 1862; Gründungsgeschichte des Zollvereins, Berlin, 1870; Betrachtungen über die geographische Lage der grossen Städte, Leipzig, 1871; Bertrachtungen über die Währungsfrage der deutschen Münzreform, Berlin, 1872; Geschichte der Nationalökonomik in Deutschland, Munich, 1874; Nationalökonomik des Ackerbaues, 8th ed., Stuttgart, 1875.—Translator's note.

In France, according to Cordier (Mémoire sur l'Agriculture de la Flandre Française), the wheat harvest yielded, in

1817, forty-eight million hectolitres, with a value in exchange of two thousand and forty-six million francs; in

1818, fifty-three million hectolitres, with a value in exchange of one thousand and four hundred and forty-two million francs; in

1819, sixty-four million hectolitres, with a value in exchange of one thousand and one hundred and seventy million francs.

A rise in the value in exchange of wheat, such as was witnessed in 1817, is synonymous with a decline in the value in exchange of money, and of all those goods whose money price has not risen. It is no objection to the views here advocated, that when the necessaries of life are very scarce, the want of clothing, furniture, articles of luxury etc., is not felt so keenly as at other times, and that the value in use of these commodities really falls; and vice versa.

Rau (Lehrbuch, I, § 61 ff.) distinguishes between the concrete or quantitative value which a certain kind of goods may have for a certain person, under certain circumstances, and the abstract or species-value which a whole class of commodities may have for men in general.

But F. J. Neumann, (Tübinger Zeitschrift, 1872, p. 288 ff.) objects, that even the abstract value of a commodity always suggests the relation of a definite number of concrete men to a definite quantity of goods; else, by the expression, value of goods, is to be understood not what it is generally meant to signify, but only the capacity to satisfy a single want.

According to Th. Cooper, Lectures on the Elements of Political Economy, (1726), 1, 15 ff. 117, the wealth of society is nothing but the aggregate wealth of all the individuals that compose it. Each individual looks out best for his own interests, and, hence, that nation must be the richest, in which each individual is most completely left to himself. (If this were so, savage nations would be the richest!) Cooper goes so far as to disapprove of the protection afforded to commerce on the high seas by a national navy; no naval war is worth what it costs, and merchants should protect themselves. He says, too, that the word “nation” is an invention of the grammarians, made to save the trouble of circumlocution, a nonentity! Adam Smith is, as might be expected, far removed from such absurdities. (Compare Wealth of Nations, IV, ch. 2, and the end of the fourth book.) But, even he is of opinion that men, in the study of their own advantage are led “naturally, or rather necessarily” (IV, ch. 2), to the employment which is most useful to society. But here Adam Smith overlooks the fact, that every individual nation strives after earthly immortality, and is, in consequence, frequently compelled to make immediate sacrifices for the sake of a distant future, a thing which can never be to the private interest of the mortal individuals who compose it. And thus, D. North, Discourses upon Trade (1691), 13 seq., says, that in commercial matters, different nations stand in precisely the same relation to the whole world, that individual cities do to the kingdom, and individual families to the city. Similarly, Boisguillebert, Factum de la France, ch. 10, 327, Daire's edition. Benjamin Franklin (ob. 1790), Political Papers, § 4. And J. B. Say, Traité d'Economie politique (1802) I, 15: every nation is, in relation to neighboring nations, in the situation of a province in relation to neighboring provinces. Unfortunately, such doctrine is only too palpably refuted by every war! J. Bentham's saying: Les intérêts individuels sont les seuls intérêts réels (Traité de Législation, I, 229). Infra § [98].

Among those who, in antiquity, most energetically maintained that the idea of national economy is not a merely nominal one, is Plato (De Republ., IV, 420, I, 462); more recently, Fichte (Der geschlossene Handelstaat, 1800), although, in general, the socialists attach as little importance to nationality as their most decided opponents. Adam Müller is a writer who deserves recognition for his advocacy of national economy, and of the state as a whole, paramount to individuals, and even generations. He gives war the credit of causing the scientific knowledge of the state to cast deeper roots, and of enlightening individuals in the most forcible way, that they are parts of one great whole. (Elemente der Staatskunst, 1809, I, 7, 113). He calls public economy, as a whole, the product of all products. What, he inquires, is the use of all wealth, if it does not guarantee itself? And this, it can do, only through the organization of the whole people, that is, through the nation (I, 202). Adam Smith's theory of labor would be correct if it considered the entire national life of a people itself as one huge piece of labor. (II, 265). And so, Müller directs his polemics against Adam Smith's premise of a merely mercantile world-market. (II, 290). Similarly, the protective tariff theoreticians, Ganieh, Théorie de l'Economie politique (1822), II, 198 ff. and Fr. List, Nationales System der politischen Oek. (1842), I, 240 ff. Colton, Political Economy of the United States, 1853. Sismondi, Nouveaux Principes (1819), I, 197, ridicules the opinion which resolves the public interest into merely private interests: It is A's interest to rob B; B, the weaker, is equally interested to let himself be robbed, that he may fare no worse. But the state—?!

John Stuart Mill, Principles of Political Economy (1848), I, p. 25, draws a distinction between the physical conditions which influence the economic situation of a people, and the moral and psychological conditions; which last have their origin in social institutions or in the fundamental principles of human nature. Only the latter belong to the domain of Political Economy. According to J. B. Say, Traité, Introd., this science embraces at once agriculture, manufactures and commerce, but only in their relation to the increase or diminution of wealth, and does not concern itself with the means employed to reach the desired end. As a rule, says Arndt (Naturgemässe Volkswirthschaft, 1851, p. 16), it takes into consideration not so much things themselves as their exchange value. Lotz (Handbuch, I, p. 6 seq.), in like manner, defines Political Economy—the science of the one activity which constitutes the basis of all industries etc. F. G. Schulze (Ueber volkswirthschaftliche Begründung der Gewerbswissenschaften, 1826), characterizes Political Economy as the science of the fundamental conditions of the well-being of a people, in so far as they lie in human nature.

When Adam Smith (book IV, c. II) says that the government in respect to matters of economy is inferior to the first best person engaged in industrial pursuits, he is right only from a technic point of view. And when Stewart, on the other hand, vindicates for the state the office of a pater-familias (book II, ch. 13), he evidently means only in national economical matters.

It is of great importance to calculate here the number of days in the year in which the laborer is compelled to be idle on account of sickness. Fenger, (Quid faciant ætas annique tempus ad frequentiam et diuturnitatem morborum, Hafniæ 1840), finds the following result:

Between 15 and 19 years, 7.2 days. Between 35 and 39 years, 7.8 days.
Between 20 and 24 years, 10.3 days. Between 40 and 44 years, 8.3 days.
Between 25 and 29 years, 9.5 days. Between 45 and 49 years, 11.6 days.
Between 30 and 34 years, 7.6 days. Between 50 and 59 years, 14.1 days.

According to Villermé, in the Annales d'Hygiène, II,

At 60 years, 16 days. At 67 years, 42 days.
At 65 years, 31 days. At 70 years, 75 days.

The latter table is the result of a comparison made of the tables of seventy Scotch mutual aid societies. Compare Digler, Polyt. Journal, XXIV, 168.

Tucker, Progress of the U.S., 137. The following data also will serve for a comparison: In Belgium, in 1856, it was estimated that, leaving persons sans profession out of consideration, 45.6 per cent. were agriculturists, 37.2 industrials, 6.7 in commerce, 2.8 in the liberal professions, 1.5 force publique, 2.1 propriétaires, rentiers, pensionnés, 3.7 domesticité. In Prussia, in 1871, of the entire male population, 28.6 per cent. were engaged in agriculture, forest-culture, hunting and fishing: 32.3 per cent. in mining, industry, building, and in founderies: 8.56 in trade and commerce; 20.3 in personal services and handiwork not belonging to any of the groups above mentioned; 2.3 in the army and navy; 3.7 in other callings; 2.7 were renters, pensioners, and persons who lived by selling or renting houses, reserving lodgings for themselves therein, and persons who gave no account of their calling. (Preuss. statisc. Zeitschr., 1875, 32. ff.) It is, however, surprising that Engel's Amtl. Jahrbuch, III, 1867, gives only 48 per cent. as belonging to the first category, and 25 to the second. In the kingdom of Saxony in 1861, 25.1 per cent. of the population were agriculturists and foresters; 56.1 were engaged in industry; 7.7 in trade and commerce; 6.8 in art, science, the service of the state and of private persons; while 4.1 per cent were without any particular calling, or returned none. Bavaria, in 1852, had 67.9 per cent. of its population engaged in agriculture; 22.7 in the trades and in manufactures; 5.5 per cent., persons living on the interest of their money, and by performing the higher class of personal services; 1.9 in the army; and 2 per cent. of listed poor. In Hermann, Beiträge zur Statistik des Königreichs Bayern. In France, according to the official reports, there were:

Agriculteurs 61.46 per cent. in 1851, 51.49 per cent. in 1866;
Industriels et commerçants 25.95 per cent. in 1851, 32.78 per cent. in 1866;
Professions libérales 9.73 per cent. in 1851, 9.48 per cent. in 1866.

To which it must be added, that, in 1851, there were 2.86 sans profession ou dont les professions n'ont pu être constatées; and that, in 1866, on the other hand, there were 2.87 per cent. in professions se rattachant à l'agriculture, industrie et commerce. (Legoyt.) In England and Wales, leaving the domestic class out of consideration (women without an independent means of employment, school children, servant girls etc.), and also the “indefinite class,” there were, in 1861, 25.3 per cent. of the population engaged in agricultural pursuits; 60.7 in industrial; 7.8 in commercial; and 6.06 in professional pursuits. In Italy, omitting housewives, children and infirm persons, there were, in 1862, 57.4 per cent. of the population engaged in agriculture; 22.9 in industrial pursuits; 4 in commerce; and 3.9 per cent. in the army and in the liberal professions. (Annali univ. di Statistica, Febbr., 1866.) On Holland, in the middle of the 17th century, see J. de Wit, Mémoires, 34 seq.

Considering the aversion exhibited against private property by J. J. Rousseau, and the unlimited power which he accords to the majority for the time being in the state (Contrat Social, 1761, II, ch. 4), it cannot be denied that his freedom and equality contain, to say the least, germs of communism by no means insignificant. But, he would, in the present state of civil society, have a feeling of respect for the rights of property implanted in the mind of the child very early, and even before the feeling of liberty is developed. (Emile, 1762, Livre II.) About the same time Morelly published his Basiliade ou Naufrage des Iles flottantes, 1753, a political romance in the interest of communism. See the same author's Code de la Nature, 1755. Mably, in his two works, Doutes proposés aux Economistes, 1768, and La Législation ou Principes des Lois, 1776, recommended the abolition of all inequality and a real community of goods. The introduction of property seems to him, une faute qu'il était presque impossible de faire. Even Beccaria calls property a dreadful but perhaps a necessary right which has left to the unfortunate nothing but a naked existence. (Dei Delitti e delle Pene, 1765, cap. 22.) The French Reign of Terror came pretty near carrying these ideas into effect. We need only refer to the abolition of the census, the payments made to the workingmen who attended the section meetings, two francs per diem, the enormous extension of confiscation, requisitions and forced loans, the revolution effected in the fortunes of individuals by the system of issuing assignats, the maximum affixed to the price of all the necessaries of life, the abolition of indirect taxes, and of what remained of the economic institutions handed down from the middle ages. According to St. Just: l'opulence est une infamie; il ne faut ni riches ni pauvres. The Cahier des Pauvres demands, first of all, that salaries “should no longer be estimated in accordance with the murderous principles of unbridled luxury.” See Forster's letter dated November 15, 1793. (Sämmtl. Schriften, IX, 125.) On the conspiracy of Baboeuf, who was executed in 1796, and who wanted to see the completest equality and community of labor, of enjoyment and education, the abolition of large cities etc., see Buonarotti, La Conjuration de B., 1821. This book contributed powerfully towards the revival of communistic ideas after the July revolution. Among modern communists who are to be distinguished from the more ancient, especially by the industrial coloring given to their theories, Cabet, Voyage en Icarie, 1840, II, holds a very prominent place. He declares the abolition of religion, of the family and of the state, to be open questions, and desires to bring the practice of a community of goods to a successful issue only through the peaceful channel of conviction.

Compare Reybaud, Etudes sur les Réformateurs contemporains ou Socialistes modernes, 1840. L. Stein, Der Socialismus und Communismus des heutigen Frankreich. See, also, the learned history of socialistic systems in Marlo's Weltökonomie, I, 2, 435 ff.; and in what concerns the most recent time, R. Meyer, Der Emancipationskampf des vierten Standes, II, 1874, seq.; a book which, in spite of its many defects, both doctrinal and journalistic, is as rich in thought, and in the knowledge of the subject it treats of, as it is permeated by a love of truth regardless of consequences. Among the opponents of socialism and communism, Malthus, On Population, B. III, ch. 3, and B. Hildebrand, Die Nationalökonomie der Gegenwart und Zukunft, vol. I, 1848, hold a very distinguished place. J. S. Mill, Principles, II, ch. 1, 3, calls attention to the fact that hitherto the principle of free property has never been consistently carried out. The first social arrangement of modern society was almost everywhere the result of conquest and violence, large traces of which yet remain. Things have always been made property which ought not to be property. Governments have endeavored to intensify the darkness of the dark side of property, and favored the concentration instead of the diffusion of wealth etc. Hence, no one can claim that the social wrongs, so-called, had their origin in property as such. Schäffle, Kapitalismus und Socialismus, 1870, has made a very note-worthy effort to recognize whatever of truth there is in socialism, and to combat its errors.

A similar development among the Greeks:

A. Rigorous slavery for debt, which Kypselos moderated at Corinth. (Pausan., V. 17, 2), and Solon abolished in Athens. (Plutarch, Sol., 15. Demosth., de fals. Legat., 412.)

B. The reckless creation of debts as seen in Aristophanes; while outside of Athens slavery for debt lasted yet a long time. (Hermann, Griech. Privatalterth., § 57, 20.) In the time of Demosthenes, the merchant in arrears in the payment of his debts was cast into prison, and the bottomry-debtor who deprived his creditor of his security might be punished with death, (Demosth. adv. Pharm., 922, 958), and this although the cessio honorum was introduced. Hermann, § 70, 3. Compare Xenoph., Vectigg., 3, Demosth. adv. Apat., 892; adv. Lacrit., and adv. Dionys. In Corinth, the state superintended expenses made by parties. This was part of its credit-policy. (Athænæus, VI, 227.) For a remarkable Rhodian law relating to debts, see Sext. Emp., Hypot. I, 149.

In Rome:

A. The chief characteristic of the ancient law in this matter was the eventual sale of the person of the debtor on the getting of the loan (nexum); the power of the creditor to put the addictus to death or to sell him in foreign parts; finally, the in partes secanto, in the concourse of creditors. Without these rigorous provisions, the borrower might easily have evaded his debts, by the emancipation of his son and turning over his property to him. (Niebuhr, Rom. Gesch., II, 770 ff; Savigny in the Abb. der Berliner Acad., 1833. Zimmern, Gesch. des röm. Privatrechts, III, 131 ff.)

B. Later, we find nothing of the execution of the debtor, or of the sale of his person; but he might be compelled to do slave labor for his creditor without any protection against ill-treatment. Slavery for debt was restricted by the Lex Poetelia. (Niebuhr, III, p. 178; Mommsen, III, 494.) The Prætorian law introduced the custom of putting the creditor in possession of the goods of the debtor, with power of sale, which proceeding rendered the debtor infamous. See several passages in Walter., Röm Rechtsgesch, 763 ff; Tertull., Apol., 4; Tab. Herac. I, 115 ff. Later, Cæsar's Lex Julia permitted the honest debtor to escape imprisonment by the assignment of his goods.

C. The moneyed oligarchy which prevailed in Rome caused the adoption of exceedingly severe measures against delinquent debtors. (Plut., Lucull., 20. Cic., ad. Att. V. 21, VI.), although its members themselves incurred debts in the most reckless manner. Cæsar, in the year A.C. 62, excluding his active (activen), owed debts to the amount of 25,000,000 sesterces; M. Antonius, in the year 24, 6,000,000; in the year 38, 40,000,000; Curio, 60,000,000; Milon, 70,000,000. (Mommsen, Römische Geschichte, III, 486.) Compare Gellius, XX, 1, XV, 14.

Concerning the arguments by which the commercial restrictions of the middle ages were defended, see below. They were, for the most part, well founded for the age in which they were advanced. A judicious education will often be compelled to provide limitations, but always with the intention, by this means, of making possible a really greater independence. Thus the current of commerce may be too weak in a poor and thinly settled country in order that supply and demand should always and everywhere meet and be satisfied. Under such circumstances, their artificial concentration at certain points is among the most efficient means of promoting the economy of the whole people. The policy of freedom of commerce was recommended even in the seventeenth century by J. Child, by North and Davenant. W. Roscher, Zur Geschichte der englisch. Volkswirthschaftslehre, 65 ff., 85 ff., 113 ff., 142 ff. And earlier yet, in Holland, by Salmasius, De Usurus, 1638, 583 and de la Court. Compare Tübinger Ztschr., 330 ff. Thus Boisguillebert says: Il n'y avait qu'à laisser faire la nature et la libertê, qui est le commissionaire de cette même nature. (Factum de la France, 1707, ch. 5.) See, also, Dissertation sur la Nature des Richesses, ch. VI; Détail de la France, 1697, II, ch. 13; Tr. des Grains, II, 8. For the most part dictated by a reaction against Colbertism.

See further, Mélon, Essai Politique sur le Commerce, 1734, ch. 2. M. Decker, Essay on the Causes of the Decline of Foreign Trade, 1744, 31 ff, 106 ff. J. Tucker, Essay on the advantages and disadvantages which respectively attend France and Great Britain with regard to Trade, 1750. Forbonnais, Elémens du Commerce, 1754, I, 63. Genovesi, c. I, 17, 3, is of opinion that at least in case of doubt, commerce stood more in need of freedom than of protection. Verri, in his Meditazioni, goes still farther. The Physiocrates, with their laissez aller and laissez faire recommend competition as the best means to increase the net income of a people. According to Dupont, 147 ff, éd. Daire, the province of legislation is confined to declaring the laws of nature. His motto is: liberté and propriété. Adam Smith asks that the state should do only three things: insure protection against foreign states, the administration of justice at home, the establishment and maintenance of certain institutions of advantage to the whole community, but which private interest could not establish for want of means to cover the expenses attending them. (Wealth of Nations, V, ch. I, 2.) Hence he demands (III, ch. 2) the abolition of all kinds of fidei commissa, of royalty in mines (I, ch. 11, 2), of all corporate and exclusive privileges, of all protective duties etc. (IV, ch. I ff), but especially of the colonial policy hitherto in vogue. (IV, ch. 8.)

The attacks of the Socialists on freedom of competition were begun by Fichte, Geschlossener Handelsstaat, 126, in which it is called a robber-system or system of spoliation. He would have the state have more solicitude for human industry than if men were so many swallows. See further, Sismondi, N. Principes, passim, who everywhere demands the protection of the government for the weaker. Fourier, N. Monde industriel, 396, who thinks that le monopole général is always a preservatif contre le commerce. Bastiat, Harmonies économiques, ch. 10, has a very valuable refutation of these follies. Recently, Rodbertus, Hildebrand's Jahrbücher, 1865, II, 272, is of opinion that “social individualism” has ever had in history the task of dissolving decaying societies, as, for instance, under the Cæsars.

Such exceptions there certainly are, even if it were not true “that the most godly cannot rest in peace unless he is acceptable to his ungodly neighbor.” Nations that furnish the same products as we do may, indeed, “spoil our market,” just as at home the selfish shoemaker may desire the prosperity of all wearers of shoes, that is of all other industries, but not that of all other producers of shoes. The view that long prevailed, that one man's gain was always some other man's loss (Th. Morus, Utopia 79, ed. Colon. 1555; Baco., Sermones fideles, cap. 15; quid-quid alicubi adiicitur, alibi detrahitur; M. Montaigne, Essais I, 21: les prouficit de l'un est le dommage de l'autre) prevailed much longer in international affairs where observation is much more difficult than in national affairs; although even here, P. de la Court, Maximes politiques, 1658, contrasts the economic interest of Holland with that of the rest of the Netherlands and prefers it to theirs. Even Voltaire says: “The desire of the greatness of the Fatherland includes the desire of evil to our neighbor. Evidently no country can gain except what another loses.” (Dict. philosophique, v. Patrie.) Compare, however, the peut-être in his Histoire de la Russie, I, 1, on the occasion of the English-Russian treaty of commerce. Similarly, Galiani, Della Moneta, I, 1, IV, 1; Verri, Opuscoli, 335, and recently v. Cancrin who says that “in every-day life, property is acquired only at some other person's expense.” (Weltreichthum, 1821, 119. Oekonomie der menschl. Gesellschaft, 1845, 23.) The cosmopolitan view (Xenoph., Cyrop., III, 2, 17. Hier., 10) which prevails in Adam Smith's school was introduced by Hume, Essays, 1752, On the Jealousy of Trade. Quesnay, Encyclopédie, v. Grains, 294, ed. Daire; A. Smith, Theory of moral Sentiments, 1759, p. 6, sec. 2, ch. 2. Pinto, Lettre sur la Jalousie de Commerce, 1771, and J. Tucker, Four Tracts on commercial and political Subjects, 1776, 34 ff and 42 ff. “The system of states exercises no influence whatever on the world's commerce.” (Lotz, Handbuch I, 11.) More recently, R. Cobden, in his Russia, Edinb., 1836, among others argued, that the conquest of Turkey by the Russians would be useful to England, because then more (?) English products would probably be sold there. Russia would become no stronger thereby, as conquests always injure the conqueror more than they benefit him. The idea of European equilibrium is therefore a chimera, because no state can be prevented from having an internal growth, as great as may be. Thus, in the summer of 1853, we heard the London Times sometimes preach that every cannon-shot fired by the English at the Russians might kill an English debtor or an English customer. The Venetians entertained a similar view at the beginning of the fifteenth century. Compare M. Sanudo in Muratori, Scriptores, XXII, 950 ff. See above, § [12].

Moreover, Malthus had recognized that there were natural rivalries between nations which produced exceptions to Tucker's laws. (Principles, Preface.) Similarly Garve, in Cicero's Pflichten (1783), III, 146 ff.

The wrong definitions of money may be divided into two classes: those which convey the idea that it is more than a commodity, and those which imply that it is less.

This was a point which was contested even among the Greeks. There were many who claimed that wealth consisted exclusively in the possession of much money; as we find, for instance, in the pseudo-Platonic dialogue Eryxias; while others insisted that money was something purely imaginary (λῆρος), and the creation, exclusively, of human laws. (Aristot., Polit., I, 3, 16, Schn.) Νόμισμα σύμβολον τῆς ἀλλαγῆς ἔνεκα. (Plato, De Rep., II, 371.) Anacharsis compares money to counters. (Plutarch, De Profectt in Virtute.) Aristotle, himself, subscribed to the second opinion, although he saw clearly, that only useful and current things (χρείαν εὐμεταχείριστον πρὸς τὸ ζῆν) could be used as money. (Polit., I, 3, 14 ff. Eth. Nicom., V, 5, 6, Rhet., II, 16.) Xenophon ascribed properties to money which no other commodity possessed; especially when he said that it could never be too plentiful, and that its price could never fall. (De Vectt. Ath., 4.) The finest ancient explanation of the nature of money is that of the jurisconsult Paullus, L. I.; Digest, XVIII, 1; and it well deserves the long commentary devoted to it by P. Neri, Osservazioni etc., in Custodi, P.A., VI, 324, ff.

Among the moderns, Melancthon., Corp. Ref., XVI, 498, and Seb. Frank, Chronik., 760, consider money as a mere symbol. On the other hand, the over-estimation in which the precious metals were held by the adherents of the Mercantile System was owing, without doubt, to their very superior utility as money; for we very frequently find that the adherents of that school insist that the precious metals must circulate. (See § [9] and § 210.) v. Schröder, Fürstl. Schatz- und Rentkammer, III f., considers new copper coins as an increase of the national wealth, but not other copper which is merely a commercial commodity. He frequently calls money, the pendulum commercii, and expresses ideas concerning it as enthusiastic as they are obscure (p. 86.) Horneck, in his Oesterreich über Alles wenn es will, 1864, calls gold and silver “our best blood, the very marrow of our strength,” and “the two most indispensable universal instruments of human activity and existence.” (p. 188.) Th. Mun, England's Treasure by forraign Trade, 1664, (ch. 2) considers cash-money and resources as synonymous in every way. Only, he says (ch. 4) that it is sometimes advisable to allow one's money to remain in foreign countries, and to use bills of exchange, banks etc., at home, as a substitute. F. Gee, Trade and Commerce of Gr. Britain, edition of 1738, laments the “stiff-necked folly of those who think money a commodity like any other.” It is one of the most common demands of the adherents of the Mercantile System that the home mines of gold and silver should be worked at no matter what sacrifice, since the money employed in working them continues to remain in the country and the newly coined precious metal is clear gain. Compare Schröder, loc. cit. 109 ff., 181. Horneck, loc. cit. 173. Broggia, Della Monete, 1743, cap. 33; v. Fusti, Staatswirthschaft, 1755, I, 246: Forbonnais, Finances de France, 1758, I, 148. Ulloa, Noticias Americanas, 1772, ch. 12. We seldom meet with the correct view on this subject in the seventeenth century. Sully, of whom Henry IV. said that he never found anything to be possessed of beauty which cost double its real value, had it at times. (Economies royales, LXXIII.) So had v. Seckendorff, Teutscher Fürstenstaat, 1655, 5th edition.

It is in accordance with the usual course of human development that the exaggerations of the Mercantile System led to a reaction characterized by an exaggeration in the opposite direction. Even Davanzati, Sulle Monete, 1588, traces the value of money back to human convention and refuses to find it in nature. A natural calf, he thinks, is più nobile than a golden one; although he elsewhere expresses his admiration of the precious metals, calls them cagioni seconde della vita beata, and lauds them because they procure us tutt'essi beni (20, 21, Cust.) Montanari (ob., 1687) demonstrates from the use of leather money etc., that the authority of the state is the only power which gives money its character as money. (Della Moneta, 35.) Davenant (ob., 1714) carries his inclination to call money “the servant of trade, measure of trade,” so far as to compare it to a ticket or counter. (Works, I, 355, 444.) Strongly as Law, himself, opposes the convention theory (Trade and Money, ch. I; Sur l' Usage des Monnaies, 1720, p. 1.), his disciple Dutot, in his Réflexions polit. sur le Commerce et les Finances, 1738, 905, éd. Daire, contrasts not only paper money but also gold and silver as representative wealth, with real wealth. Berkeley, Querist, 1735, teaches that the real notion of money is not that of a “commodity, standard, measure, pledge, but [No. 23] ticket or counter, entitling to power and fitted to record and transfer such power.” (441, 475.) Even if the names, livre, shilling etc., remain, and the metal is dropped, every article may still as well as before be counted and sold, industry promoted and the course of commerce preserved. (p. 440.) According to Montesquieu, Esprit des Lois, XXI, 22, gold and silver are a richesse de fiction ou de signe. Compare Lettres persanes, II, 18. Benjamin Franklin also maintains that the value of gold, for instance, is principally a credit-value. Remarks relative to the American Paper-Money, 1765, Works, II, Sparks' edition. Forbonnais, Finances de France, I, 86 f., calls money, simply a means to put commodities, which alone have value originally, in circulation. Hence it is, in itself, a matter of indifference whether, for a given quantity of coin, a person gives one thaler, or ten. In the Elements de Commerce, I, 11, II, 67 ff., he draws a distinction between richesses naturelles (raw material), artificielles (manufactured products), and richesses de convention (money.) von Schlözer, Aufangsgründe, 1805, 100, 138, calls money something imagined; and Th. Smith, Essay on the Theory of Money and Exchange, 1807, asserts, that true money is only an ideal measure of value, of which coins in turn are only the representatives. Compare, however, Edinb. Review, Oct., 1808. Oppenheim, Die Natur des Geldes, 1855, grants that in the beginnings of trade, money possessed the character of a commodity; but says that as soon as the services of circulation of the money-commodity prevailed over its services in consumption, it lost all its importance for the latter purpose, and that all relations dependent thereon ceased. At present, he claims money is only the representative of commodities, but no commodity itself. See, on the other hand, Roscher's critical analysis in the Literarisches Centralblatt, 1855, December.

The true doctrine was advocated in a classic form by Nicolaus Oresmius (ob. 1382). See his Tractatus de Origine et Jure nec non et Mutationibus Monetarum, newly edited by Wolowski: Paris, 1864. See Roscher's essay in the Comptes rendus of the Académie des Sciences morales et politiques, vol. 62, 435 ff. Based on the latter we have Gabr. Biel (ob. 1495), De Monetarum Potestate simul et Utilitate, 1542, and G. Agricola, De Re metallica, 1556, I, 4 ff. This true doctrine was acclimated earliest in England and Holland, and before the mercantile system invaded them. Compare Hobbes, Leviathan, 24, in which the concoctio bonorum is described by means of money, and the full and clear chapter 12 of Salmasius, De Usuris (1638), who, among other things, shows how Midas, who turned everything into bread, died of thirst. Petty shows very clearly that national wealth does not consist exclusively nor mainly in money. Every country, he says, needs a certain quantity of money to carry on trade. It would be a waste to increase the former, the latter remaining the same. But the precious metals, by reason of their durability and universally recognized value, possess the character of wealth in a higher degree than other commodities.

On the whole, the use of money in a nation is like the use of fat in the individual. (Quantulumcunque concerning Money, 1682.) Compare Roscher, z. Geschichte der eng. Volkswirthschaftslehre, 80 f. Davanzati and Hobbes had compared it to the blood, as has recently Schmitthenner, Staatswissenschaften, 1839, I, 459. North calls money a commodity of which there may be an excess as well as a want. (Discourse on Trade, preface and postscript.) Compare Locke, Considerations on the Lowering of Interest, 1691, Works II, 13 ff., 19. Galiani, 1750, Della Moneta, IV, holds a very happy middle place between the alchymists and the philosophic contemners of gold. See, further, Quesnay, éd. Daire, 64, 75 ff. Turgot, Sur la Formation des Richesses, § 30 ff, had many clear views on this subject. Verri, Meditazioni, 1771, II, 1, calls money the universally current commodity. The expressions, measure of value, pledge, representative of all commodities might be true also of all other wares. It cannot, however, be denied that most modern political economists have not borne sufficiently in mind the peculiarities which distinguish money from all other commodities, as is apparent from the doctrine of the balance of trade prevalent in Hume's and Adam Smith's time. To this extent, therefore, the semi-mercantilistic reaction instituted by Ganilh, Théorie de l'Economie politique, 2822, II, 380 ff., 426; St. Chamans, N. Essai sur la Richesse des Nations, 1824, ch. 3; and Colton, Public Economy for the United States, 1849, 203 ff., who bring into relief the difference between “money as the subject” and “money as the instrument of trade,” was not wholly unfounded. Ad. Müller exaggerates a correct thought, and causes it to degenerate into a species of mystic pleasantry, when he calls every individual in the state and every commodity that possesses value, in exchange or a social character, money.

The highest object of the state is to develop this money-character more and more. (Elemente der Staatskunst, II, 194, 199.) The statesman, he says, should be money. (III, 206.) A very valuable monograph on this subject is M. Chevalier's De la Monnaie, 1850, constituting the third volume of his Cours d'Economie polititique. Knies, Geld und Credit, I, 1873, is here most thorough and acute, especially in keeping separate, by well defined lines of demarcation, the five different functions of money: measure of value (by proper division into parts: price-measure), instrument of exchange, means of transportation of values, and means of storing up and preserving values.

Knies shows how the making of money legal tender by the state, although of only secondary importance, is by no means an irrelevant matter, since persons must then have it, even if they do not want it for purposes of use or exchange, to discharge their liabilities thereby etc., etc. (Tübinger, Zetschrift, 1858, 272.)

In all these cases, barter-economy (Naturalwirthschaft) meets with greater and greater difficulties as civilization advances. How, for instance, could 50 days annually of socage-service or labor be redeemed by the achievement at one time of 1,000 days of socage-service or labor? The rich man requires money principally as a means of payment, the poor man as a medium of exchange. The requirement or need of a people of media of payment is much more susceptible of extension or contraction, than that of media of exchange, made especially so by the intervention of claim-rights instead of money. (Knies, loc. cit, 200 ff.) Ravit, Beitr. z. Lehre vom Gelde, emphasizes this feature of money altogether too much after the manner of a jurist. But he is entirely right in adopting the exclusion of the rei vindicatio against the honest possessor as necessary to the completion of the idea of money.

The contrast between barter-economy and money-economy is of great and fundamental importance. It repeats itself with so much regularity in the history of every highly developed nation, that political economists gifted with perception for the historical, could not possibly overlook it. Thus, Aristotle, for instance, establishes with the utmost care and accuracy the difference between οἰκονομικὴ and χρηματιστικὴ, that is, between natural economy and artificial economy, corresponding to the difference between value in use and value in exchange. (Polit., I, 3, Schn.) Similarly D. Hume, who allows a period of luxury, culture, industry, of trade and manufactures, of freedom and circulation of money, to be preceded by one in which the feeling of wants is not awakened, in which coarseness and idleness prevail, one in which agriculture is alone pursued, and monetary economy and freedom decline, and trade by barter obtains. (Discourses, passim, especially On Interest and on Money.) A similar contrast we find frequently, and as one of his fundamental thoughts, in J. Steuart.

As to how the transition from barter-economy to monetary-economy is generally effected, see F. G. Hoffmann, Lehre vom Gelde, 1838, 176 ff. In the Tyrol, as late as 1820, the greater portion of purely mechanical work, such as that of the smith, the carpenter, and the washerwoman, were purely feudal duties. On the other hand, payment in money was the rule, in the beginning of the fourteenth century. (F. Beidermann, Technische Bildung in Oesterreich, 3.) Yet, for a long time after, the functions of a measure of value were performed by pieces of land, and those of an instrument of exchange by cattle and natural products. (Arnold, Gesch. des Eigenth., 207.) In France, money-economy, i.e., trade by money, had grown to importance earlier. (Nitsch., Ministerialität und Bürgerthum, im 11. und 12. Jahr., 143.) Even in the time of Mary Stuart, the Scotch estimated the rent of land in “cauldrons of victuals.” (Moryson, Itinerary, 1617, III, 155.) In ancient Italy, during the first three centuries of Rome, there was, with the exception of the Greek colonies, only trade by barter. Mommsen, Römische Gesch., I, 293, shows that the oldest ases were not money in the higher sense of the word, but belonged rather to the stage of barter-economy. On the other hand, we find in the time of the classic jurists, much as slavery had limited the sphere of action of money, the principle: pecuniæ nomine non solum numerata pecunia, sed omnes res, tam soli quam mobiles, et tam corpora quam jura continentur. (L. 222, Digest L. 16; compare 4, 5, 178.) Similarly in Cicero, Top. 6. De Invent, II, 21. De Legg, II, 19, 21; III, 3. Compare Dionys. Hal., N.R. IV, 15.

The use of the cauris (Cypræa moneta) in India this side and beyond the Ganges, in upper Asia, and in southern Africa depends on their employment for purposes of ornament, on their greater uniformity, and on the rarity of copper which would otherwise be better suited to purposes of change. In Calcutta, 1280 cauris are equivalent to about half a shilling. (McCulloch.) Compare K. Ritter, Africa, 149, 324, 422, 1038; Asien, I,964; II, 120; III, 233, 739; IV, 53, 420; Salin, III, 62; Botz, in the Tübinger Ztschr. Similarly among the fishing population of Northwestern America. (Stein-Wappäus, Handbuch I, 352.) Salt as money on the Chinese-Birman boundary (Marco Polo, 38), but especially in the interior of Africa, where nature does not at all produce it, but into which it is brought by caravans from the deserts, where salt is found in great quantities. M. Polo, Travels, 305, found the current price of a salt-tablet, two and a half feet long, one foot, two inches broad, and two inches thick, to be equal to the value of two pounds sterling among the Mandingos. In Abyssinia, the salt-bars are generally six inches long, three inches broad, one and a half inches thick, and they are bound with an iron ring to protect them against fracture. Sixty of them are worth one thaler. (Ausland, 1846, No. 35.) Slaves used as money: Barth, Reise, III, 338, 344. Tea-blocks in upper Asia and Siberia; and they are given by the Chinese to the Mongols as pay for troops. (Ritter, Asien, III, 252,) In Keachta, a tea-block is equal in price to one paper ruble. (Ausland, 1846, No. 20. Timkowski, Reise nach China, 143.) Date-money in the Sivah oasis. (Hornemann, Reise, 21.) Also in the Persian date-country, where, formerly, the lowest silver piece of money was coined in the form of a date (Ritter, Asien, VIII, 752, 819.)

The ancient Mexicans used as money cocoa-nuts, in bags of 24,000 pieces, cotton-stuffs, small pieces of copper, and gold dust in quills. (Humboldt, N. Espagne, IV, 11.) Cocoa-beans are still used as small change there. (Ibidem, IV, 10.) On the Amazon, wax-cakes weighing one pound are used. (Smyth, Journey from Lima to Para, 1836.) Among the ancient inhabitants of Rügen, linen (Helmold, I, 39); and still among the Icelanders, the so-called Vadhmâl. During the middle ages, 120 ells of Vadhmâl were equal in value to one milch cow or six milch sheep, or two and a half ounces of silver. (Leo in Raumer's histor. Taschenbuch, 1835, 515.) That the ancient northern mode of valuation, by the Vadhmâl and in cows is older than by the mark is shown by Wilda, Gesch. des deutschen Strafrechts, I, 331. The cod-fish money used by the Icelanders was, on account of its great commercial importance as an article of export, an advance upon the use of the Vadhmâl. Among the Caffirs, besides cauris, mats, javelins, glass corals, but particularly brass rings, are used as money. From three to four hundred of these rings are strung together, and two such strings are equal in value to one cow. (Klemm, Kulturgeschichte, III, 308, 320 f.) Ivory used as money in the neighborhood of the Portuguese colonies in Africa. (Martius, Reise, II, 670.) In Logone, Denham (1822) ff., had met with pieces of iron as a medium of circulation; but on the other hand, Barth (1849), with small strips of cotton from 2 to 3 inches in breadth, and shirts for larger sums. (A. R., III, 274, 297, 538.) In colonies, money of this nature is continued for a long time. Thus cod-fish used in Newfoundland, sugar in the English West Indies (Adam Smith, I, ch. 4), tobacco in Maryland and Virginia. (Douglas, V, 2, 389; Ebeling, V, 435 ff.) The last was related to the inspection and storage of the tobacco intended for exportation. Payment was made in orders on the stored and inspected tobacco, even as late as the end of the eighteenth century. In 1618, the forced circulation of tobacco was decreed in Virginia, and under severe penalties. (Gouge, History of Paper-Money and Banking in the United States, ch. 1.)

Engel, at the usual tariff for land and railroad freight (10 and 5 pfennigs per mile and hundredths of a mile) estimates the enhancement of the price of the following commodities, for one mile of transportation of a custom-hundred-weight (Zollcentner) at the following percentage of their average value:

Gold, value 47610 German Reichsthaler per cwt., 0.000007 by land, 0.0000035 by railroad.
Silver, value 3000, 0.00111 by land, 0.00055 by railroad.
Cotton, value 45, 0.074 by land, 0.037 by railroad.
Tin, value 24, 0.1389 by land, 0.0694 by railroad.
Lead, value 8, 0.416 by land, 0.208 by railroad.
Iron, value 2.5, 1.333 by land, 0.666 by railroad.
Rye, value 2, 1.666 by land, 0.833 by railroad.
Potatoes, value 0.6, 5.555 by land, 2.777 by railroad.
Coal, value 0.12, 27.777 by land, 13.888 by railroad.

Their great specific gravity, also, makes the precious metals easy of transportation. Thus Cazeau calculates that a given value of gold is 17,222 times as easy to transport as the same value in wheat. But as, where the weight is the same, the labor of transportation is inversely as the volume, this number must be multiplied by 26, and we therefore have 447,772 times. In the case of silver, the relation to wheat is as 1:15,554. Concerning copper, see Storch, Handbuch 1, 488. Chevalier, Cours, III, 17 ff.

Davanzati, Lezione sulle Moneta, 1588, 32 ff., Cust., thinks that all terrestrial things which serve to satisfy the wants of men are, by virtue of agreement, equal in value to all the gold, silver and copper; and that the parts comport themselves as the whole. The price of a commodity is based on this, that men find in it as much of their beatitudine as is afforded them by a given quantum of gold etc. Similarly, Montanari, who adds as a limitation the quantity of money spendibile in commercio. (Della Moneta, 45, 64, Cust.) The same opinion leads Locke to the singular conclusion, that, as there is now in the world, ten times as much silver as there was previous to the discovery of America, each single piece of silver, separately considered, and taken in relation to such commodities as have not varied, is worth only one-tenth of what it was then. Locke, here, starts out with the gross assumption, shared even by Ganilh, Théorie, II, 386 ff., that in the case of money the demand is always, relatively speaking, equally strong and just as great as the supply, or as the amount in the market. (Works, II, 23 ff.) Further, Montesquieu, Esprit des Lois, XXII, 7, 8. Per contra, however, see Montesquieu, ibid. XXII, 5, 6, and Hume, On Money and on the Balance of Commerce, Essays II, 1752.

Hume knew perfectly well, that only circulating money and circulating commodities operated on price, but failed to take the rapidity of circulation into account. Similarly, Forbonnais, Eléments du Commerce, II, 212; even Canard, Principes, ch. 6; Fichte, Geschloss. Handelstaat, 93 ff., and Stein, Lehrbuch, 58. Contested by Law, Trade and Money considered, 140, a work directed especially against the Mercantilistic essay, Britannia languens; 1680, by Mélon, Essai politique sur le Commerce, ch. 22; Genovesi, Economia civile, 1764, II, 1, 15; Steuart, Principles, II, ch. 28; Verri, Meditazioni, XVII, 3 ff.; Büsch, Gedlumlauf, II, 40. The simple taking of an inventory of most private resources which possess so much greater value in other commodities than in money is enough to demonstrate the error of Davanzati's doctrine. Thus, in France, in Necker's time, the cash money in the kingdom was estimated at 2,200,000,000 livres, and the average value of the wheat crop alone at 1,000,000,000. Necker, Législation et Commerce des Grains, 1776, I, 215. Recently, Michel Chevalier, estimated the amount of money in France at from 3-½ to 4 milliards, while the official estimate of its immovable property alone was over 83 milliards.

It is scarcely possible to determine exactly the amount of money in a country; for the reason that, outside of the suppositions of bankers etc., there is no authority which can be safely relied on, unless it be the reports concerning the coinage, and of the emission of paper money. The information, no less necessary, to be derived from the statistics of the importation and exportation of money, the melting down of coin by gold smelters etc., can never be exactly obtained. In England, at the end of the sixteenth century, the circulating medium was estimated at £4,000,000 (Hume, History of England, ch. 44, App.); under Charles II., at £6,000,000, when the population was 6,000,000. (Petty, Several Essays, 179.) About 1711, Davenant, New Dialogues, 11 ff., mentions £12,000,000 as the amount; and Anderson, Origin of Commerce, a., 1659, £16,000,000 in 1762. The circulation of gold, shortly before 1797, was estimated by Rose at, at least, £40,000,000; by Lord Liverpool, at £30,000,000; by Tooke, at only £22,500,000. (History of Prices, V, 130 ff.) Moreau de Jonnés, 1837, assumed £43,500,000 (Statistique, I, 329), and Helferich (Schwankungen der edlen Met., 1843, 147), £45,000,000. Sir Robert Peel, estimated the amount in 1845 at £59,000,000, to which was to be added an average of £28,000,000 in bank notes, after deduction made of the metallic reserve. According to Jevons, the amount of British money is now £80,000,000 in gold, £14,000,000 in silver, £1,000,000 in copper; the sum total, including bullion and bank notes, after the deduction of their metallic representatives, £134,000,000. (Economist, December, 1868, July, 1869.) In France, Vauban, Dîme royale, 104 (Daire), estimated the cash money at about 500,000,000 livres, over 750,000,000 francs, with which Voltaire, Siècle de Louis, XIV, ch. 30, agrees so far as the year 1683 is concerned. In 1730, Voltaire, assumes the amount to be 1,200,000,000 of the coins of that time. Necker, Administration des Finances, III, 66, estimated it, in 1784, at 2,200,000,000 livres; Mollien, about 1806, at 2,300,000,000. The valuations in Louis Philippe's time varied from 2,400,000,000 to 2,500,000,000 (Chamber of Deputies, April, 13, 1847), and 4,000,000,000. (Blanqui.) The valuations of 1870 were, according to Wolowski, 4 milliards; and to Bonnet, from 5 to 6 milliards. Compare Wolowski, L'Or et l'Argent, 383 ff., Euquête, 42. The German Zollverein is said to have had, at the beginning of 1870 (Soetbeer) 480,000,000 or 520,000,000 thalers (Weibezahn) cash money.

In Wirtemberg, Memminger, 1840, estimated the resources of the country at 1,600,000,000 guldens, of which 36,000,000 were cash; and the yearly gross income at 179,000,000 guldens; so that the money was 20 per cent. of the latter and 2¼ per cent. of the former. The annual sales = 226,000,000. Therefore the coin currency must have circulated on an average between six and seven times in a year. In the electorate of Hesse, there were per capita 4 thalers, 18 sgrs., 9 hellers, metallic money, and 3 thalers, 9 sgrs., 4 hellers, paper-money. (B. Hildebrand, Statist. Mitth., 1853, 185.) The amount of money in Naples, in 1840, was estimated at 42,000,000 ducats. (Scialoja.) It has been estimated that, in 1830, Spain possessed 1,725,000,000 francs. (Barrego von Rottenkamp, 330.)

This explains the high price of gold in Farther Asia, which was formerly separated from America, the principal source of supply of the precious metals, by a journey around the earth, the then usual course of the world's trade.

The precious metals are generally higher in country places than in large cities, and in the interior than on the sea-coast. Since the public highways etc. in Germany have been so much improved, the difference in the value of money in upper and lower Germany has almost disappeared. (Rau, in the Archiv der polit. Oek., III, 338.)

The first clear germ of this doctrine, which is one of the most important theoretical principles of international-trade politics, is to be found in David Hume, On Interest; Cantillon, Nature du Commerce, 226, 369 ff. Ricardo, Principles, ch. 7. “Gold and silver having been chosen for the general medium of circulation, they are, by the competition of commerce, distributed in such proportions amongst the different countries of the world, as to accommodate themselves to the natural traffic which would take place if no such metals existed, and the trade between countries were purely a trade of barter.” Rebenius, Oeff. Credit, I, 29 ff. Still further developed, especially by John Stuart Mill, Elements, 1821, III, 4, 13 f.; Torrens, The Budget, 1844. John Stuart Mill, Essays on some unsettled Principles of Political Economy, 1844, No. 1, and Principles, III, ch. 19, § 3, 5th ed.: “The opening of a new branch of export trade from England; an increase in the foreign demand for English products, either by the natural course of events or by the abrogation of duties; a check to the demand in England for foreign commodities, by the laying on of import duties in England, or of export duties elsewhere; these and all other events of similar tendency, should make the imports of England, bullion and other things taken together, no longer an equivalent for the exports; and the countries which take her exports would be obliged to offer their commodities, and bullion among the rest, on cheaper terms, in order to re-establish the equation of demand; and thus England would obtain money cheaper, and would acquire a generally higher range of prices.”

Obscurely surmised by Beccaria, E.P., 3, 18, and even by Galiani, Della Moneta, II, 2. Senior's admirable work, Three Lectures on the Cost of Obtaining Money, 1830, follows up the thought that every country obtains indigenous and foreign products at a cost which grows smaller in the same proportion as the productiveness of its people's labor is large. This would, certainly, explain why it is that perhaps one hundred English days' work in cotton manufactures will exchange against as much silver as is produced by two hundred days' work in Mexican mines and foundries. This would not, by any means, produce a lowering of the price of the precious metals relatively to other English commodities, but the influence would be felt equally by all the products of English national industry.

Most countries go through these successive periods in their corn trade: in the first, exportation preponderates; in the second, there is an equilibrium; in the third, importation preponderates. (M. Chevalier, III, 74 ff.) Compare Tacit., Ann., XII, 43. Omitting the two dearest and the two cheapest years, the Prussian provinces were circumstanced as follows:

In The Whole Kingdom, the price of Rye, 1816 to 1837, was 40. silver groschens. The population per square mile, 2,776
In Prussia, 32.2 silver groschens, and 1,827
In Posen, 34.3 silver groschens, and 2,180
In Brandeburg, Pomerania, 38.4 silver groschens, and 2,093
In Saxony, 40.3 silver groschens, and 2,366
In Silesia, 38.0 silver groschens, and 3,612
In Westphalia, 47.7 silver groschens, and 3,600
In Rhine Province, 49.4 silver groschens, and 5,078

Rau, Lehrbuch, I, § 183. As to when it may be assumed that the price of corn has remained unchanged, see Hermann, loc. cit., 125 ff.

In Buenos Ayres, in the nineteenth century, beggars on horseback were to be seen. (Robertson, Letters on South America, II, 294.) In Krasnojarsk, in 1770, 1-½ rubles was the price of an ox, 1 ruble of a cow, from 2 to 3 of a horse, from O.3 to O.5 of a sheep; O.15 of a deer. (Pallas, Sibirische Reise, III, 5, II 12.) According to the Tables of Prices in Sir F. M. Eden, State of the Poor, Append. I, and Rogers, History of Agriculture and Prices (1866), I, 245, 361, the following prices obtained in England;

(On an average.)

in 1125-26, one ox, 1 shilling; one quarter of wheat, 20 shillings;
in 1260-1400, one ox, 13 shillings 1-¼d; one quarter of wheat, 5 shillings 10-¾d;
in 1406, one ox, 9-½ shillings; one quarter of wheat, 4-½ shillings;
in 1463, one ox, 10-20 shillings; one quarter of wheat, 1-⅔-4-⅔ shillings.

Compare Hume, History of England, a. 1327. Under Henry VIII. veal, beef, mutton and pork were food for the poor in England, and cost on an average 1-½d per pound; while wheat cost from 7 to 8 shillings a quarter. (24 Henry VII, c. 3. Price, Observations, II, 148 f.) The same appears from the “reasonable prices” which Charles I, in 1663, had established by sworn juries viz.: that the different kinds of meat were much cheaper comparatively than corn in our days. (Rymer, Foedera, XIX, 511. Anderson, Origin of Commerce, a. 1633.) In many places in the highlands of Scotland, in the middle of the seventeenth century, one pound of oat-bread cost as much or more than one pound of the best meat. The union of Scotland with more highly civilized England soon changed the relation, so that in Adam Smith's time, good meat, in nearly all parts of Great Britain was worth from 2 to 4 times as much as the same weight of wheat bread. (Wealth of Nations, I, ch. 11, 1.) The Thomas Hospital in London paid, on an average, for good beef per stone weight:

1701-1710: 1s. 7.9d.
1764-1773: 1s. 3.7d.
1794-1803: 1s. 5.d.
1804-1821: 1s. 10.9d.
1822-1842: 1s. 1.5d.

(Porter, Progress of the Nation, III, 112.) Among the most certain proofs of the high degree of economic civilization attained in upper Italy about the close of the medieval times is the fact, that the price of cattle, compared with that of wheat in the thirteenth and fourteenth centuries, varies very little from what it is to-day. (Cibrario, Economia politica del medio Evo, III, 335-383.) Compare Rau, Lehrbuch I, § 185. In Athens, the cost of a medimnos of wheat was as great as that of a sheep in Solon's time. In the age of Demosthenes, it cost only half as much. (Böckh, Staatshaushalt der Athener, I, 107, 132.) It is obvious, however, that the price of meat compared with that of corn, was lowered by the great extension of the artificial cultivation of meadows; for, when the former has reached its maximum, it becomes a great spur to the promotion of the latter. Thus, in England, the price of meat, at the beginning of the sixteenth century, was on an average, higher than in Adam Smith's time. (loc. cit.) To the same cause is to be ascribed the state of things in Prussia mentioned by v. Podewils, Wirth schaftserfahrungen, II, 15.

As a common basis for such calculations, the following may be accepted. It is plain that meadows, pasturages and forage-fields must yield as much in meat, as corn-fields of the same dimensions of equal goodness, and situated as favorably, in corn. According to Block, a Prussian acre (Morgen) of the best quality, used as a meadow, produces a hay-value equal to 1,000 pounds, a clover-value equal to 2,420; as a vegetable field, a beet or potato-value equal to 6,050-6,930 pounds, v. Lengerke's estimate is that 110 pounds of cattle-fodder expressed in terms of hay, produces on an average 40 pounds of milk, and from 3-½ to 4 pounds of meat. This would, at most, give 36, 88 and 220-252 pounds of meat. The yield of wheat, v. Lengerke estimates, on the best soil, and on an average, at 14 Prussian scheffels (at 80 pounds, i.e. 1,120 pounds) yearly per acre (Morgen). The three periods in the history of the prices of cattle were clearly recognized by Thaer, Landw. Gewerblehre, 1815, 100.

Thus Wolff's experiments made at Möckern have shown that in the case of sheep fed with hay, the wool becomes much heavier and the flesh leaner than those of sheep fed with a more concentrated food. While it is estimated in England, at the present time, that the wool of South-Down sheep is worth scarcely one-tenth what their flesh is (Jacob, On Corn Trade, 166), mutton, from the year 1260 to 1400, was, on an average, worth 17 pence; and this even at a time when prices were gradually rising; but the wool of one animal (1 lb., 7-¾ ounces), 5-¼ pence. (Rogers, I, 362, 395.) Even under Anglo-Saxon kings the fleece was worth 40 per cent. of the value of the whole sheep, (David Hume.) And so W. Macann, Two Thousand Miles Ride through the Argentine Provinces, 1853, I, 151, says that in the interior of Buenos Ayres, he purchased 8,000 sheep at 18 pence a dozen, and after a march of 200 English miles, sold the skins for sixty pence a dozen. In Goya, formerly, a live horse cost 3 pence, its skin on the coast 12 pence; and the slaughtering of the beast cost 3 pence, the removal and cleaning of the skin 3 pence; and 3 pence were paid for transportation. (Robertson.)

In Ireland, in 1763, it not unfrequently happened that the skin and tallow of an ox cost as much in a commercial city as the whole ox had cost in the nearest market town. (Temple, Works III, 13.) In England, from 1260 to 1400, the average price of a whole cow was 9s. 9d.; of the hide 1s. 8d., and cows were cheapest in the first decade, i.e., 6s. 2d., and the hides dearer than they were generally afterwards, i.e., by from 1-9-¼d. (Rogers, I, 361, 451.) In Saxony, according to Engel (1853), the average price of horned cattle was about 46 thalers; of their hide, 4 thalers and 21 silver groschens. Russia exported, 1842-1847, 72,636,166 silver rubles worth of tallow, 1,832,137 silver rubles worth of horse hair, 10,811,735 worth of bristles (Borsten), 7,387,140 of uncured skins, 36,159,452 of sheep's wool, but flesh-meat only to the amount of 370,362 rubles, and entire animals to the value of 6,853,241 rubles. (P. Storch, Der Bauernstand Russlands, 289 ff.) Tallow is there ten times dearer than the same volume of wheat. (Steinhaus, Russlands industrielle und commercielle Verhältnisse, 294 ff.); while in Saxony, according to Engel (1821), a pound of wheat cost on an average 7.8 pfennigs, and a pound of tallow 30 p. However, Russia's recent progress in civilization has had for effect: that the exportation of tallow (1833 = 4-½ million puds; 1869 = 2-¼ mill.) has greatly fallen off; while that of butter and live stock has increased. (v. Lengefeld, R. im 19. Jahrh., 220 ff.)

In England, during the fourteenth century, a pound of meat cost, on an average, ¼d.; of lard, from 1-½ to 2. (Rogers, I, 411.) On the other hand, from 1848 to 1856, the average January price of beef from America was 110 shillings; of tallow from St. Petersburg, 48s. 11d. per cwt. (Newmarch.) And so, in the time of Pallas, the Cossacks chased the deer of their steppes only for the sake of its skin and horns. (Pallas, Reise, III, 524.) While the Greeks got horn from Macedonia and Thrace (Herodot., VII, 156), it is a striking proof of high civilization that at Athens (?), about the time of the hundredth Olympiad, an ox-hide was worth only 3 drachmas, and the whole ox 77 drachmas. (Böckh, Staatshaushalt, I, 105 ff.)

As the ox is primarily serviceable as an object of food and an instrument of labor, and the sheep on the other hand, only an instrument to produce wool, it is easy to understand why, with the further advance of civilization, the price of oxen rises comparatively much more than the price of sheep. In Athens, during the time of Solon, an ox was equal in value to five sheep. (Plutarch, Solon, 23.) So also in countries with a low civilization in the time of Polybius. (Polyb., XXXIV, 8; Gell., XI, 1.) Why the same was the case in Rome at the beginning of the Republic? (Plut., Popl., 11). In England the proportion between the price of an ox and that of a sheep was,

in 927 as 6:1 (Henry.)
in 1125 as 3:1
in 1182 as 6.3:1
in 1197 as 9:1
in 1229 as 8:1 (Eden.)
in 1260-1492 (av.) as 9.2:1 (Rog.)
in 1497 as 10:1
in 1500 as 11.6:1
in 1511 as 8:1
in 1528 as 10:1
in 1529 as 12.8:1
in 1531 as 9.4:1
in 1551 as 10.6:1
in 1597 as 8.2:1 (Eden.)

At present the proportion may be from 10 to 20:1. In Saxony, it is as 48 thalers to 5.27. (Engel.)

During the middle ages, pork constituted the most usual animal food even of the best classes. (Büsching, Ritterzeit und Ritterwesen, I, 164.) Immense importance attached to pork by the Lex Salica. (Tit., II, XIV; Emendatt. Caroli Magni, II, 1 ff.) The archbishop of Cologne used every day 24 large and 8 medium-sized hogs, and four more on the three great festivals. The abbot of Corvey used daily five fat and one lean hog, besides two young ones. (Kindlingen, Münsterische Beitr., Urkunden, 147, 126.) In 1345, at the court of Dauphiny, there were used annually for 30 persons, 30 salt and 52 fresh hogs; whereas, in modern Paris, with 800,000 inhabitants, only 32,000 hogs are consumed yearly. (Roquefort, De la Vie privée des Fr., I, 310 f.) Compare herewith the place occupied by the swine-herds in the Odyssey in Greece's age of chivalry. In England, in the time of William I., woods were taxed according to the number of hogs they might feed. At present, there is an enormous production of hogs in Servia, which, in many places, constitutes the only source of ready money to the agricultural population.

And about the end of the eighteenth century, it is said that Servia received from Austria alone 1,300,000 florins yearly for hogs. (Ranke, Serb. Revolution, 95.) In 1864, Servia's total exports amounted to 62,500,000 piasters, of which 28,162,260 were for hogs, 7,043,000 for wool, 7,662,000 for the skins of sheep and deer, 5,732,000 for cattle, 1,222,400 for tallow. (Kanitz, Serbien, 598 ff.) Great production of hogs also in the Moldau and in Wallachia, in the United States and Mexico, where, instead of butter, only lard and suet are used; also in Lombardy, the Prussian Rhine province, Belgium, the English milk-producing districts, Gloucester, Wilt, Dumfries, Galloway and the districts where agricultural proletarians abound—Ireland and Yorkshire. It is a consequence of the same law that, among the South Sea Islanders, the hog was the principal domestic animal, as it still is among the Chinese. Similarly in the whole of Asia, beyond the Ganges (Ritter, Erdkunde, IV, 938, 1101); in semi-barbarous upper Italy in the time of Polybios (II, 15); in Gall itself, in the time of Augustus. (Strabo, IV, 192, 197.) The America of the ancient Greeks, Sicily, exported hogs, mainly, in the time of Hermippos. (Athen., I, 27.) And even among the Romans, the consumption of pork was much greater than the consumption of beef. (Marquard-Becker, Handbuch, V, 2, 39.)

According to Schuckburg, Philosophical Transactions of 1798, and Kraus, Vermischte Schriften, I, tab. I, the prices of the following species of animals rose in England between 1550 and 1795: horses, 904 per cent.; oxen, 896 per cent.; sheep, 876 per cent.; cows, 2050 per cent.; hogs, 1964 per cent.; geese, 300 per cent.; butter rose from 5d. per pound to 11-½d.; beer from 1d. per gallon to 2-¾d.; agricultural day wages from ½s. to 1s. 5-¼d.; wheat 326 per cent. Compare, however, Edinburg Review, III, 246 ff. In Germany also, cows and hogs have increased much more in price than horses and sheep. (Tübinger Ztschr., 1871, 342.) Dutot, Réflexions, 946 ff., éd. Daire, says that the value of the precious metals in France decreased in value between the times of Louis XII. and Louis XV. in the ratio of 3-79/91:1. On the other hand, the prices of different commodities rise in very different degrees:

Fat sheep, from 7 sous to 10 livres.
Lean sheep, from 5 sous to 5 livres 10 sous.
Hogs, from 10 sous to 25-35 livres.
Capons, from 1 sou to 12 sous.
Hens, from 1-½ sous to 6 sous.
Pigeons, from 1-½ sous to 3 sous.
Deer, from 1-½ sous to 15 sous.

Thus, in Thuringia, the average price in silver of corn from the sixteenth century until the period 1848-61 increased in the ratio of from 1 to 3-4; the price of the different kinds of animals, on the other hand, from 1 to 5-10. (Knies, in Hildebrand's Jahrbb., 1863, 78.) The price of the different kinds of corn as compared with one another may, however, be modified by many different circumstances. Thus the Capitulare Saxoniæ of 797, c., II, estimated the prices of rye, barley and oats to be to one another as 30:30:15; while the Magdeburg Chamber of 1804 estimated them to be as 17:14:8. In the kingdom of Saxony, in 1841-9, the average prices of wheat, rye, barley and oats stood to one another in the ratio of 144:100:75:47 (Engel); while, in the middle ages, wheat, rye and oats were as 9:6:3 (Gersdorf, Cod. Depl. Sax., II, p. XXXIV); under Prince August, corn, barley and oats were as 24:22:12. Assuming the price of rye to be equal to 100, the cost was:

At Brussels, in the 16th century, wheat 126.7, barley 80, oats 50
At Brussels, in the 17th century, wheat 138.8, barley 82.9, oats 51.9
At Brussels, in the 18th century, wheat 147, barley 86.7, oats 55.2
At Brussels, 1815-1844, wheat 156
At Brussels, 1841-1850, wheat 153, barley 82.7, oats 51
At Berlin, 1789-1818, wheat 135, barley 74.8, oats 54
At Berlin, 1819-1832, wheat 143.5, barley 74.9, oats 52

(Rau, Lehrbuch, I, § 183.) To understand this, it is necessary to bear in mind the relatively great increase of wheat bread, beer made of barley, and horses, as objects of luxury. The unusually low price of oats in North America, as compared with the price of wheat, is dependent on the facility of exporting the latter. In Florence, in the fifteenth century, the price of wheat was 22-⅔, of rye, 12, of barley, 8 soldi. (Pagnini, Sopra il giusto Pregio delle Cose, 325.)

The English so called custom-house prices (Zollhauspreise) correspond to the market prices of 1696. If these are assumed = 100, the price

Of steel and iron was, in 1826, 83, in 1831, 56
Of coal was, in 1826, 47, in 1831, 45

Between 1835 and 1850, Scotch iron had already become cheaper by one-half (Meidinger, 387), and coal in London by one-third (Porter).

Thus, in England, the price:

Of glass was, in 1826, 387; in 1831, 369 per cent.
Of leather was, in 1826, 285; in 1831, 123 per cent.
Of silk goods was, in 1826, 158; in 1831, 249 per cent.

of the price of the same articles in 1796. (Rau.) Of 29 chemical products of the Parisian manufacture, the wages of labor is on an average only 7.4 per cent. of the selling price; and, in some cases, only from 1 to 2 per cent. (Chabrol, Richerches Statistiques sur la Ville de Paris, 1821; Hermann, Staatsw. Untersuch., 137.) In Buschtiehrad, between 1670 and 1870, barley rose from 1 to 4.8; hops to 6.52; fire wood to 6.14; the excise to 6.54; but beer only to 2.81; although wages increased ten fold. (Inama Sternegg, Gesch. der Preise im österreich. Ausstellungsbericht von 1873, 43.)

The British East India Company exported gold and silver on an average per annum from:

1711-1720, £434,000
1721-1730, 532,000
1731-1740, 487,000
1741-1750, 631,000
1751-1760, 571,000
1761-1770, 152,000
1771-1780, 43,000
1781-1790, 393,000
1791-1800, 352,000
1801-1807, 852,000

Milburn, Oriental Commerce, 1813, 419. According to M. Chevalier, Introduction aux Rapports de l'Exposition de 1867, the trade of Europe and North America, with India, China, Japan and the Australian islands, amounted in 1800, to only 410 million francs, in 1866, to 4,024 million. Yet, for a time, the largely increased exportation of English manufactures to East India and of East Indian opium to China, had changed the relation so that the exportation of the precious metals from South Asia, by a great deal, more than counterbalanced the imports. On the other hand, between 1853 and 1856 240,000,000 thalers were shipped to India and China from England and the Mediterranean harbors; in 1863 and 1864, even as much as 300 millions, to be, for the most part, buried there. Moreover, the immense quantity of cash money—often as much as from 12 to 15 million in pounds sterling—in the state treasury, and silver ornaments (§§ 44, 123) customary in India, demand a considerable yearly supply to make up for wear. Newmarch speaks of 400 million pounds sterling which can be maintained in its condition hitherto by a yearly increase of 1 per cent. (History of Prices, VI, 723.) From 1865 to 1869, English steamships carried gold and silver to the East in the following quantities, yearly: 93.9, 66.3, 24.6, 70.2 and 60.4 million thalers, in addition to which almost as much came directly from California. Statist. Journ., 1871, 122 seq.

Compare, for instance, on the early productiveness of the Brazilian gold districts which soon ceased: Spix und Martius, Reise nach Brasilien, I, 262 f., 350. Gardner, Travels in the Interior of Brazil, 1846. On Hispaniola, see Benzoni, N. Mundo, I, 61, and Peschel, Gesch. der Entdeckungen, 304, 556. Hitherto, gold had been obtained by the usual mining process, only in very few places. As a rule, it has been found in alluvial land not far from the surface. Compare Ansted, The Gold-Seekers' Manual, 1849. These circumstances have made the production of gold important from the first; and they still make it comparatively easy, while it causes little demand for capital but for great skill. As soon, therefore, as the greater part of the country washed for gold has been worked, which does not require a long time, the whole is abandoned, while in the production of silver the great amount of capital fixed in pits, shafts, kilns etc. ties the parties engaged in the enterprise to the spot, and necessitates the continuation of the enterprise. In recent times, however, Australia and California have developed the mining and machine production of gold to a surprising extent. According to Laur, La Production des Métaux précieux en Californie, 1862, 33, and the Journal des Economistes, Nov. 1862, Californian gold-quartz produced, in 1851, on an average, 635 francs per ton; in 1860, only from 80 to 85 francs; but the gold-washing methods have become cheaper in the ratio of 2,500:1. However, the production of the precious metals seems even now to be decreasing. According to the Statist. Journal, 1866, 99, it amounted on an average to:

in 1849-51, gold £23.9 million, silver £15.5 million.
in 1852-56, gold 38.7 million, silver 16.1 million.
in 1857-59, gold 36.5 million, silver 17.1 million.
in 1860-63, gold 33.5 million, silver 18.2 million.
in 1864-68, gold 30.0 million, silver 19.5 million.

The number of gold-diggers in Victoria steadily decreased from 125,764 in 1857, to 63,053 in 1867.

While the public, even since 1850, think they have noticed a depreciation in the value of money, there are a great many learned political economists who are by no means prepared to grant it. The principal advocates of this opinion are Tooke, and Newmarch, in vol. VI. of the History of Prices (1857). Also Lavergne, in the Journal des Economistes. And really the enhanced dearness of many kinds of goods up to 1857, might have been accounted for by causes affecting the goods themselves: diminished supply by reason of bad harvests, commercial gluts etc.; increased demand by capitalization on a gigantic scale, speculation, but especially by the elevation of the lower classes etc.

The London wholesale prices were on the 1st day of January, 1869, nearly all lower by 10 per cent. than on the 1st day of July, 1857. Only indigo, cotton and meat had risen. (Hildebrand's Jahrb., 1870, I, 328.) In many instances the enhanced dearness is entirely local, by reason of the greater facilities for transportation in places where prices were already higher. But as new truths are very easily exaggerated by their discoverers, much of Tooke's view concerning these events depends upon a polemic carried too far against the theory of the balance of trade which was customary in the so-called currency school. Compare, in opposition to Tooke, Lavasseur, in the Journal des Economistes, March, 1838, and M. Chevalier, La Baisse probable de l'Or, 1858. Lavasseur, from the difference between the official and real custom-house prices in France, calculates that raw materials in 1856 were on the average 63 per cent., and in 1858, 20 per cent. higher than in 1826; and that manufactured articles were in 1856, just as high, and in 1858, 6 per cent. lower than in 1856. An average made of all commodities showed, in 1856, an enhancement of 30 per cent, and in 1858 of 9 per cent. (Hildebrand's Jahrb., 1864, II, 118.)

In the Hamburg market in 1847-65, 87 articles declined in price, 183 rose in price, and 24 remained about stationary. (Amtl. Statistik von 1887, 18 ff.) Jevons assumes a general rise in the price of commodities between 1849 and 1869 of about 18 per cent. (Economist, May 8, 1869.) He makes this estimate from the average March prices of 50 of the principal articles. Assuming the average March price of 1849=100, we have, according to him, for the following years, respectively: 101, 103, 101, 116, 130, 125, 129, 132, 118, 120, 124, 123, 124, 123, 122, 121, 128, 118, 120, 119. Previous years showed: 1789=133; 1799=202; 1809=245; 1819=175; 1829=124; 1839=144. (Compare supra, § [129], note 1.) The budget of a Swiss teacher's family consisting of five persons has become dearer since 1840 ff., their consumption remaining the same and of only the simplest articles, by 72.5 per cent. (Böhmert, Arbeiterervhältnisse etc., I, 302 ff., 355.) That, however, the depreciation is under-estimated most precisely in England and over-estimated in Germany, Knies very well accounts for by the price-leveling effects of the more modern means of communication. (Tübinger Zeitschr., 1858, 280 ff.)

Even Plato, De Legg., V, 742, was acquainted with money after the Spartan type, intended only for internal trade: νόμισμα ἐπιχώριον, αὐτοῖς μὲν ἔντιμον τοῖς δὲ ἄλλοις ἀνθρώποις ἀδόκιμον. Besides the state kept for foreign trade a supply of the universal Hellenic money, of which in case of need, private individuals could acquire what portion they needed by exchange. When Dionysius I. issued tin instead of silver money, all the Syracusans, although they noticed the forgery, acted in their intercourse with one another as if they considered the coins genuine. (Aristot., Œcon., II, 21, Pollux, IX, 79.) Timotheos behaved more honorably when, pressed by the dearth of money, he gave his troops copper coin tokens, which passed for the time being for their full value in the camp; but which were later to be redeemed at their full value in silver. (Aristot., Œc. II, 22.) Compare Polyæn, Strateg., IV, 10, 2. The iron money which the Klazomenians exchanged with the rich for silver, which bore interest, but which the rich were forced to take, had a longer duration; the silver was used to pay foreign state creditors, the iron money circulated for the time being in the city, and was gradually redeemed. (Aristot., loc. cit, II, 17.)

We are still more forcibly reminded of paper money by the Carthaginian leather money, where any object whatever of the size of a coin was shut up in a leather envelope with the state seal, and then circulated as if it were the coin it purported to be. Mieris, Beschryving der Munstn, 1726, explains the saga of Dido's ox-skin by means of this leather money. Certain it is, however, that the surprise with which the sophistical dialogue, Eryxias, mentions the matter, is a proof how foreign it was to the Greeks. Concerning the Roman plated denarii which were stamped with the silver coins, but which were also accepted by the state treasury, see Mommsen, R. G., I, 405.

The paper money issued by Colbert's successor, Chamillard, soon lost on account of its too great amount, 25 per cent. of its value, spite of the fact that it bore interest, and that ¼ of all payments to private persons had to be made in it. (Forbonnais, Recherches et Considérations, II, 182.) When the people of the United States, in 1775, issued paper money, it did not decline in value up to the end of 1776, so long as the amount did not exceed $20,000,000, as it was considered a matter of honor to take it at par. Afterwards, when the amount issued continued to increase, not even the law that a refusal to accept it, or insisting on taking it below par, should be punished with the loss of the commodity, and that the guilty party should be declared a national enemy, could keep it from declining in value; so that in May, 1871, a dollar in specie was worth $200.5 in paper. Compare Franklin, Works, ed. Sparks, II, 421, VIII, 328, 505.

France, during the Reign of Terror, on the 2d day of April 1793, threatened the claiming of a discount in the taking of assignats with six years' confinement in chains, and on the 1st day of August, on Couthon's motion, with twenty years' confinement. In addition to this, maximum prices for the principal necessities of life were fixed and the exceeding of them was punished by severe penalties; and in France, and still more in the neighboring conquered countries, there were many persons who preferred to take assignats instead of payment rather than permit themselves to be robbed by requisitions. And yet on the 4th of June, 1796, one franc in specie exchanged for 800 francs assignats. Compare Büsch, Geldumlauf, III (§ 58 ff., d'Ivernois, Etat. des Finances Française, 1796).

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