Principles of Political Economy, Vol. 2Roscher, Wilhelm
General
Principles of Political Economy, Vol. 2
Roscher, Wilhelm
Economics
But how is it when these improvements become general throughout the
country? If population and consumption remain unchanged, the supply of
agricultural products will exceed the demand. This would compel farmers,
if there be no avenue open to exports, to curtail their production. The
least fertile and most disadvantageously situated parcels of land will
be abandoned to a greater or less extent, and the least productive
capital devoted to agriculture, withdrawn. In this way, rent goes down
both relatively and absolutely, although the owners of land may be able
to partially cover their loss by the gain which results to them as
consumers and capitalists.[157-1] (§ 186). After a time, however, and as
a consequence of the diminished price of corn, population and
consumption will increase, and entail an extension of agriculture and a
consequent rise in rents.[157-2] If it, relatively speaking, reaches the
same point as before, it still is absolutely much greater than before.
Let us suppose that there are three classes of land of equal extent in a
country, which for an equal outlay of capital produce 100,000, 80,000
and 70,000 bushels yearly. The rent of the land here would be equal to
at least 40,000 bushels. If the yield of production now doubles, while
the demand for agricultural products also doubles, the aggregate harvest
will be 200,000 + 160,000 + 140,000 bushels, and consequently rent will
have risen to at least 80,000 bushels. But this increase of rent has
injured no one. If the population increases in a less degree than the
productiveness of the land, the consumer may, to a certain extent, gain
largely, and the landowner better his condition. However, great
agricultural improvements spread so gradually over a country, that, as a
rule, the demand for agricultural products can keep pace with the
increased supply. But even in this case, that transitory absolute
decline of rent may be avoided; and it cannot be claimed universally, as
it is by many who are satisfied with mumbling Ricardo's words after him,
that an increase of rent is possible only by an enhancement of the price
of the products of the soil. Where the development of a people's economy
is a normal one, the rent of land is wont to increase gradually, but at
the same time to constitute a diminishing quota of the entire national
income.[157-3]
Improvements in milling,[157-4] and in the instruments of
transportation[157-5] adapted to agricultural products, and the
introduction of cheaper[157-6] food, have the same effect as
improvements of agricultural production. All such steps in advance
render an increase in population, or in the nation's resources, possible
without any corresponding increase in the amount paid to landowners as
tribute money.[157-7]
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