New lands are not tilled, and capital is not employed for a less return, unless the produce will pay the cost of production.
A rise of prices, therefore, creates, and is not created by, Rent.
When more capital is employed in agriculture, new land is tilled, a further outlay is made on land already tilled; and thus also Rent arises from increase of capital.
When capital is withdrawn from agriculture, inferior, i. e. the most expensive soils, are let out of cultivation; and thus Rent falls.
A rise of Rent is, therefore, a symptom, and not a cause, of wealth.
The tendency of Rent is, therefore, to rise for ever in an improving country.—But there are counteracting causes.
Art increases production beyond the usual returns to capital laid out: prices fall in proportion to the abundance of the supply, and Rent declines.
Improved facilities for bringing produce to market, by increasing the supply, cause prices to fall and Rent to decline.
London: Printed by W. Clowes, Stamford-street.
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