An Inquiry into the Nature and Causes of the Wealth of NationsSmith, Adam
History
An Inquiry into the Nature and Causes of the Wealth of Nations
Smith, Adam
Economics
Thirdly, of the materials, whether altogether rude, or more or less
manufactured, of clothes, furniture, and building which are not yet made
up into any of those three shapes, but which remain in the hands of the
growers, the manufacturers, the mercers, and drapers, the
timber-merchants, the carpenters and joiners, the brick-makers, etc.
Fourthly, and lastly, of the work which is made up and completed, but
which is still in the hands of the merchant and manufacturer, and not yet
disposed of or distributed to the proper consumers; such as the finished
work which we frequently find ready made in the shops of the smith, the
cabinet-maker, the goldsmith, the jeweller, the china-merchant, etc. The
circulating capital consists, in this manner, of the provisions,
materials, and finished work of all kinds that are in the hands of their
respective dealers, and of the money that is necessary for circulating and
distributing them to those who are finally to use or to consume them.
Of these four parts, three—provisions, materials, and finished work,
are either annually or in a longer or shorter period, regularly withdrawn
from it, and placed either in the fixed capital, or in the stock reserved
for immediate consumption.
Every fixed capital is both originally derived from, and requires to be
continually supported by, a circulating capital. All useful machines and
instruments of trade are originally derived from a circulating capital,
which furnishes the materials of which they are made, and the maintenance
of the workmen who make them. They require, too, a capital of the same
kind to keep them in constant repair.
No fixed capital can yield any revenue but by means of a circulating
capital. The most useful machines and instruments of trade will produce
nothing, without the circulating capital, which affords the materials they
are employed upon, and the maintenance of the workmen who employ them.
Land, however improved, will yield no revenue without a circulating
capital, which maintains the labourers who cultivate and collect its
produce.
To maintain and augment the stock which may be reserved for immediate
consumption, is the sole end and purpose both of the fixed and circulating
capitals. It is this stock which feeds, clothes, and lodges the people.
Their riches or poverty depend upon the abundant or sparing supplies which
those two capitals can afford to the stock reserved for immediate
consumption.
Public-domain text, read in full here on John Shaqi.
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