An inquiry into the nature and causes of the wealth of

21

Adam Smith

niuses are of use to one another; the different produces of their

respective talents, by the general disposition to truck, barter, and

exchange, being brought, as it were, into a common stock, where

every man may purchase whatever part of the produce of other

men’s talents he has occasion for,

CHAPTER III

CHAPTER III

CHAPTER III

CHAPTER III

CHAPTER III

THA

THA

THA

THA

THAT 

T 

T 

T 

T THE DIVISION OF L

THE DIVISION OF L

THE DIVISION OF L

THE DIVISION OF L

THE DIVISION OF LABOUR IS LIM-

ABOUR IS LIM-

ABOUR IS LIM-

ABOUR IS LIM-

ABOUR IS LIM-

ITED BY 

ITED BY 

ITED BY 

ITED BY 

ITED BY THE EXTENT OF 

THE EXTENT OF 

THE EXTENT OF 

THE EXTENT OF 

THE EXTENT OF THE MARKET

THE MARKET

THE MARKET

THE MARKET

THE MARKET

A

S

 

IT

 

IS

 

THE

 

POWER

 of exchanging that gives occasion to the divi-

sion of labour, so the extent of this division must always be lim-

ited by the extent of that power, or, in other words, by the extent

of the market. When the market is very small, no person can have

any encouragement to dedicate himself entirely to one employ-

ment, for want of the power to exchange all that surplus part of

the produce of his own labour, which is over and above his own

consumption, for such parts of the produce of other men’s labour

as he has occasion for.

There are some sorts of industry, even of the lowest kind, which

can be carried on nowhere but in a great town. A porter, for ex-

ample, can find employment and subsistence in no other place. A

village is by much too narrow a sphere for him; even an ordinary

market-town is scarce large enough to afford him constant occu-

pation. In the lone houses and very small villages which are scat-

tered about in so desert a country as the highlands of Scotland,

every farmer must be butcher, baker, and brewer, for his own fam-

ily. In such situations we can scarce expect to find even a smith, a

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22

The Wealth of Nations

carpenter, or a mason, within less than twenty miles of another of

the same trade. The scattered families that live at eight or ten miles

distance from the nearest of them, must learn to perform them-

selves a great number of little pieces of work, for which, in more

populous countries, they would call in the assistance of those work-

men. Country workmen are almost everywhere obliged to apply

themselves to all the different branches of industry that have so

much affinity to one another as to be employed about the same

sort of materials. A country carpenter deals in every sort of work

that is made of wood; a country smith in every sort of work that is

made of iron. The former is not only a carpenter, but a joiner, a

cabinet-maker, and even a carver in wood, as well as a wheel-wright,

a plough-wright, a cart and waggon-maker. The employments of

the latter are still more various. It is impossible there should be

such a trade as even that of a nailer in the remote and inland parts

of the highlands of Scotland. Such a workman at the rate of a

thousand nails a-day, and three hundred working days in the year,

will make three hundred thousand nails in the year. But in such a

situation it would be impossible to dispose of one thousand, that

is, of one day’s work in the year. As by means of water-carriage, a

more extensive market is opened to every sort of industry than

what land-carriage alone can afford it, so it is upon the sea-coast,

and along the banks of navigable rivers, that industry of every

kind naturally begins to subdivide and improve itself, and it is

frequently not till a long time after that those improvements ex-

tend themselves to the inland parts of the country. A broad-wheeled

waggon, attended by two men, and drawn by eight horses, in about

six weeks time, carries and brings back between London and

Edinburgh near four ton weight of goods. In about the same time

a ship navigated by six or eight men, and sailing between the ports

of London and Leith, frequently carries and brings back two hun-

dred ton weight of goods. Six or eight men, therefore, by the help

of water-carriage, can carry and bring back, in the same time, the

same quantity of goods between London and Edinburgh as fifty

broad-wheeled waggons, attended by a hundred men, and drawn

by four hundred horses. Upon two hundred tons of goods, there-

fore, carried by the cheapest land-carriage from London to

Edinburgh, there must be charged the maintenance of a hundred

men for three weeks, and both the maintenance and what is nearly

equal to maintenance the wear and tear of four hundred horses, as

well as of fifty great waggons. Whereas, upon the same quantity of

goods carried by water, there is to be charged only the mainte-

nance of six or eight men, and the wear and tear of a ship of two

hundred tons burthen, together with the value of the superior

risk, or the difference of the insurance between land and water-

carriage. Were there no other communication between those two

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23

Adam Smith

places, therefore, but by land-carriage, as no goods could be trans-

ported from the one to the other, except such whose price was

very considerable in proportion to their weight, they could carry

on but a small part of that commerce which at present subsists

between them, and consequently could give but a small part of

that encouragement which they at present mutually afford to each

other’s industry. There could be little or no commerce of any kind

between the distant parts of the world. What goods could bear the

expense of land-carriage between London and Calcutta? Or if there

were any so precious as to be able to support this expense, with

what safety could they be transported through the territories of so

many barbarous nations? Those two cities, however, at present

carry on a very considerable commerce with each other, and by

mutually affording a market, give a good deal of encouragement

to each other’s industry.

Since such, therefore, are the advantages of water-carriage, it is

natural that the first improvements of art and industry should be

made where this conveniency opens the whole world for a market

to the produce of every sort of labour, and that they should always

be much later in extending themselves into the inland parts of the

country. The inland parts of the country can for a long time have

no other market for the greater part of their goods, but the coun-

try which lies round about them, and separates them from the

sea-coast, and the great navigable rivers. The extent of the market,

therefore, must for a long time be in proportion to the riches and

populousness of that country, and consequently their improve-

ment must always be posterior to the improvement of that coun-

try. In our North American colonies, the plantations have con-

stantly followed either the sea-coast or the banks of the navigable

rivers, and have scarce anywhere extended themselves to any con-

siderable distance from both.

The nations that, according to the best authenticated history,

appear to have been first civilized, were those that dwelt round the

coast of the Mediterranean sea. That sea, by far the greatest inlet

that is known in the world, having no tides, nor consequently any

waves, except such as are caused by the wind only, was, by the

smoothness of its surface, as well as by the multitude of its islands,

and the proximity of its neighbouring shores, extremely favourable

to the infant navigation of the world; when, from their ignorance

of the compass, men were afraid to quit the view of the coast, and

from the imperfection of the art of ship-building, to abandon them-

selves to the boisterous waves of the ocean. To pass beyond the

pillars of Hercules, that is, to sail out of the straits of Gibraltar,

was, in the ancient world, long considered as a most wonderful

and dangerous exploit of navigation. It was late before even the

Phoenicians and Carthaginians, the most skilful navigators and

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