An Inquiry into the Principles of Political Oeconomy (Vol. 1 of 2): Being an essay on the science of domestic policy in free nations. In which are particularly considered population, agriculture, trade, industry, money, coin, interest, circulation, banks, exchange, public credit, and taxesSteuart, James, Sir
History
An Inquiry into the Principles of Political Oeconomy (Vol. 1 of 2): Being an essay on the science of domestic policy in free nations. In which are particularly considered population, agriculture, trade, industry, money, coin, interest, circulation, banks, exchange, public credit, and taxes
Steuart, James, Sir
Economics
If this plan be pursued, foreign trade will increase in proportion to
the number of inhabitants; and domestic luxury will serve only as an
instrument in the hands of the statesman to increase demand when the
home supply becomes too great for foreign consumption. In other words,
the rich citizens will be engaged to consume what is superfluous, in
order to keep the balance even in favour of the industrious, and in
favour of the nation.
The whole purport of this plan is to point out the operation of three
very easy principles.
The first, That in a country entirely taken up with the object of
promoting foreign trade, no competition should be allowed to come from
abroad for articles of the first necessity, and principally for food, so
as to raise prices beyond a certain standard.
The second, That no domestic competition should be allowed upon articles
of superfluity, so as to raise prices beyond a certain standard.
The third, That when these standards cannot be preserved, and that from
natural causes, prices get above them, public money must be thrown into
the scale to bring prices to the level of those of exportation.
The greater the extent of foreign trade in any nation, the lower these
standards _must_ be kept; the less the extent of it, the higher they
_may_ be allowed to rise. Consequently,
Were no man in a nation employed in producing the necessaries of life,
but every man in supplying articles of foreign consumption, the prices
of necessaries might be allowed to fall as low as possible. There would
be no occasion for a standard in favour of those who live by producing
them.
Were no man in the state employed in supplying strangers, the prices of
superfluities might be allowed to rise as high as possible, and a
standard would also become useless, as the sole design of it is to
favour exportation.
But as neither of these suppositions can ever take place, and as in
every nation there is a part employed in producing, and a part in
consuming, and that it is only the surplus of industry which can be
exported; a standard is necessary for the support of the reciprocal
interests of both parties at home; and the public money must be made to
operate only upon the price of _the surplus_ of industry so as to make
it exportable, even in cases where the national prices upon home
consumption have got up beyond the standard. Let me set this matter in
another light, the better to communicate an idea which I think a little
obscure.
Were food and other necessaries the pure gift of nature in any country,
I should have laid it down as a principle to discourage all foreign
competition for them, either below or above any certain standard;
because in this case the lower the price the better, since no
inconveniency could result from thence to any industrious person. But
when the production of these is in itself a manufacture, or an object of
industry, a certain standard must be kept up in favour of those who live
by producing them.
Public-domain text, read in full here on John Shaqi.
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