An inquiry into the nature and causes of the wealth of

100

The Wealth of Nations

nary profits. These profits sometimes are very great, and some-

times, more frequently, perhaps, they are quite otherwise; but, in

general, they bear no regular proportion to those of other old trades

in the neighbourhood. If the project succeeds, they are commonly

at first very high. When the trade or practice becomes thoroughly

established and well known, the competition reduces them to the

level of other trades.

Secondly, this equality in the whole of the advantages and dis-

advantages of the different employments of labour and stock, can

take place only in the ordinary, or what may be called the natural

state of those employments.

The demand for almost every different species of labour is some-

times greater, and sometimes less than usual. In the one case, the

advantages of the employment rise above, in the other they fall

below the common level. The demand for country labour is greater

at hay-time and harvest than during the greater part of the year;

and wages rise with the demand. In time of war, when forty or

fifty thousand sailors are forced from the merchant service into

that of the king, the demand for sailors to merchant ships neces-

sarily rises with their scarcity; and their wages, upon such occa-

sions, commonly rise from a guinea and seven-and-twenty shil-

lings to forty shilling’s and three pounds a-month. In a decaying

manufacture, on the contrary, many workmen, rather than quit

their own trade, are contented with smaller wages than would

otherwise be suitable to the nature of their employment.

The profits of stock vary with the price of the commodities in

which it is employed. As the price of any commodity rises above

the ordinary or average rate, the profits of at least some part of the

stock that is employed in bringing it to market, rise above their

proper level, and as it falls they sink below it. All commodities are

more or less liable to variations of price, but some are much more

so than others. In all commodities which are produced by human

industry, the quantity of industry annually employed is necessar-

ily regulated by the annual demand, in such a manner that the

average annual produce may, as nearly as possible, be equal to the

average annual consumption. In some employments, it has already

been observed, the same quantity of industry will always produce

the same, or very nearly the same quantity of commodities. In the

linen or woollen manufactures, for example, the same number of

hands will annually work up very nearly the same quantity of linen

and woollen cloth. The variations in the market price of such com-

modities, therefore, can arise only from some accidental variation

in the demand. A public mourning raises the price of black cloth.

But as the demand for most sorts of plain linen and woollen cloth

is pretty uniform, so is likewise the price. But there are other em-

ployments in which the same quantity of industry will not always

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101

Adam Smith

produce the same quantity of commodities. The same quantity of

industry, for example, will, in different years, produce very differ-

ent quantities of corn, wine, hops, sugar tobacco, etc. The price of

such commodities, therefore, varies not only with the variations

of demand, but with the much greater and more frequent varia-

tions of quantity, and is consequently extremely fluctuating; but

the profit of some of the dealers must necessarily fluctuate with

the price of the commodities. The operations of the speculative

merchant are principally employed about such commodities. He

endeavours to buy them up when he foresees that their price is

likely to rise, and to sell them when it is likely to fall.

Thirdly, this equality in the whole of the advantages and disad-

vantages of the different employments of labour and stock, can

take place only in such as are the sole or principal employments of

those who occupy them.

When a person derives his subsistence from one employment,

which does not occupy the greater part of his time, in the intervals

of his leisure he is often willing to work at another for less wages

than would otherwise suit the nature of the employment.

There still subsists, in many parts of Scotland, a set of people

called cottars or cottagers, though they were more frequent some

years ago than they are now. They are a sort of out-servants of the

landlords and farmers. The usual reward which they receive from

their master is a house, a small garden for pot-herbs, as much

grass as will feed a cow, and, perhaps, an acre or two of bad arable

land. When their master has occasion for their labour, he gives

them, besides, two pecks of oatmeal a-week, worth about sixteen

pence sterling. During a great part of the year, he has little or no

occasion for their labour, and the cultivation of their own little

possession is not sufficient to occupy the time which is left at their

own disposal. When such occupiers were more numerous than

they are at present, they are said to have been willing to give their

spare time for a very small recompence to any body, and to have

wrought for less wages than other labourers. In ancient times, they

seem to have been common all over Europe. In countries ill culti-

vated, and worse inhabited, the greater part of landlords and farm-

ers could not otherwise provide themselves with the extraordinary

number of hands which country labour requires at certain sea-

sons. The daily or weekly recompence which such labourers occa-

sionally received from their masters, was evidently not the whole

price of their labour. Their small tenement made a considerable

part of it. This daily or weekly recompence, however, seems to

have been considered as the whole of it, by many writers who have

collected the prices of labour and provisions in ancient times, and

who have taken pleasure in representing both as wonderfully low.

The produce of such labour comes frequently cheaper to mar-

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