Two men employ equal capitals--one in agriculture, the other in manufactures. That in agriculture produces a net annual value of 1200_l._ of which 1000_l._ is retained for profit, and 200_l._ is paid for rent; the other in manufactures produces only an annual value of 1000_l._ Suppose that by importation, the same quantity of corn can be obtained for commodities which cost 950_l._, and that, in consequence, the capital employed in agriculture is diverted to manufactures, where it can produce a value of 1000_l._ the net revenue of the country will be of less value, it will be reduced from 2200_l._ to 2000_l._, but there will not only be the same quantity of commodities and corn for its own consumption, but also as much addition to that quantity as 50_l._ would purchase, the difference between the value at which its manufactures were sold to the foreign country, and the value of the corn which was purchased from it. Mr. Malthus says, "It has been justly observed by Adam Smith, that no equal quantity of productive labour employed in manufactures can ever occasion so great a reproduction as in agriculture." If Adam Smith speaks of value, he is correct, but if he speaks of riches, which is the important point, he is mistaken, for he has himself defined riches to consist of the necessaries, conveniences, and enjoyments of human life. One set of necessaries and conveniences admits of no comparison with another set; value in use cannot be measured by any known standard, it is differently estimated by different persons. FOOTNOTES: [1] Chap. xv. part i. "Des Debouches," contains in particular some very important principles, which I believe were first explained by this distinguished writer. [2] Book i. chap. 5. [3] "But though labour be the real measure of the exchangeable value of all commodities, it is not that by which their value is commonly estimated. It is often difficult to ascertain the proportion between two different quantities of labour. The time spent in two different sorts of work will not always alone determine this proportion. The different degrees of hardship endured, and of ingenuity exercised, must likewise be taken into account. There may be more labour in an hour's hard work, than in two hours' easy business; or, in an hour's application to a trade, which it costs ten years' labour to learn, than in a month's industry at an ordinary and obvious employment. But it is not easy to find any accurate measure, either of hardship or ingenuity. In exchanging, indeed, the different productions of different sorts of labour for one another, some allowance is commonly made for both. It is adjusted, however, not by any accurate measure, but by the higgling and bargaining of the market, according to that sort of rough equality, which, though not exact, is sufficient for carrying on the business of common life."--_Wealth of Nations._ Book i. chap. 10.