Summary of Principles illustrated in this Volume.
As exchangeable value is ultimately determined by the cost of production, and as there is an incessant tendency to an increase in the cost of producing food, (inferior soils being taken into cultivation as population increases,) there is a perpetual tendency in the exchangeable value of food to rise, however this tendency may be temporarily checked by accidents of seasons, and by improvements in agricultural arts.
As wages rise (without advantage to the labourer) in consequence of a rise in the value of food, capitalists must either sell their productions dearer than is necessary where food is cheaper, or submit to a diminution of their profits.
Under the first alternative, the capitalist is incapacitated for competition with the capitalists of countries where food is cheaper: under the second, the capital of the country tends, through perpetual diminution, to extinction.
Such is the case of a thickly-peopled country depending for food wholly on its own resources.
There are many countries in the world where these tendencies have not yet shown themselves; where there is so much fertile land, that the cost of producing food does not yet increase; and where corn superabounds, or would do so, if there was inducement to grow it.
Such inducement exists in the liberty to exchange the corn with which a thinly-peopled country may abound, for the productions in which it is deficient, and with which a populous country may abound. While, by this exchange, the first country obtains more corn in return for its other productions, and the second more of other productions in return for its corn, than could be extracted at home, both are benefited. The capital of the thickly-peopled country will perpetually grow; the thinly-peopled country will become populous; and the only necessary limit of the prosperity of all will be the limit to the fertility of the world.
But the waste of capital caused by raising corn dear and in limited quantity at home, when it might be purchased cheap and in unlimited quantity abroad, is not the only evil attending a restriction of any country to its own resources of food; a further waste of capital and infliction of hardship are occasioned by other consequences of such restriction.
As the demand for bread varies little within any one season, or few seasons, while the supply is perpetually varying, the exchangeable value of corn fluctuates more than that of any article whose return to the cost of production is more calculable.