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Book I, Chapter XI, 1
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OF THE RENT OF LAND.
Rent, considered as the price paid for the use of land, is naturally the highest which the tenant can afford to pay in the actual circumstances of the land. In adjusting the terms of the lease, the landlord endeavours to leave him no greater share of the produce than what is sufficient to keep up the stock from which he furnishes the seed, pays the labour, and purchases and maintains the cattle and other instruments of husbandry, together with the ordinary profits of farming stock in the neighbourhood. This is evidently the smallest share with which the tenant can content himself, without being a loser, and the landlord seldom means to leave him any more. Whatever part of the produce, or, what is the same thing, whatever part of its price, is over and above this share, he naturally endeavours to reserve to himself as the rent of his land, which is evidently the highest the tenant can afford to pay in the actual circumstances of the land. Sometimes, indeed, the liberality, more frequently the ignorance, of the landlord, makes him accept of somewhat less than this portion; and sometimes, too, though more rarely, the ignorance of the tenant makes him undertake to pay somewhat more, or to content himself with somewhat less, than the ordinary profits of farming stock in the neighbourhood. This portion, however, may still be considered as the natural rent of land, or the rent at which it is naturally meant that land should, for the most part, be let.
The rent of land, it may be thought, is frequently no more than a reasonable profit or interest for the stock laid out by the landlord upon its improvement. This, no doubt, may be partly the case upon some occasions; for it can scarce ever be more than partly the case. The landlord demands a rent even for unimproved land, and the supposed interest or profit upon the expense of improvement is generally an addition to this original rent. Those improvements, besides, are not always made by the stock of the landlord, but sometimes by that of the tenant. When the lease comes to be renewed, however, the landlord commonly demands the same augmentation of rent as if they had been all made by his own.
He sometimes demands rent for what is altogether incapable of human improvements. Kelp is a species of sea-weed, which, when burnt, yields an alkaline salt, useful for making glass, soap, and for several other purposes. It grows in several parts of Great Britain, particularly in Scotland, upon such rocks only as lie within the high-water mark, which are twice every day covered with the sea, and of which the produce, therefore, was never augmented by human industry. The landlord, however, whose estate is bounded by a kelp shore of this kind, demands a rent for it as much as for his corn-fields.
The sea in the neighbourhood of the islands of Shetland is more than commonly abundant in fish, which makes a great part of the subsistence of their inhabitants. But, in order to profit by the produce of the water, they must have a habitation upon the neighbouring land. The rent of the landlord is in proportion, not to what the farmer can make by the land, but to what he can make both by the land and the water. It is partly paid in sea-fish; and one of the very few instances in which rent makes a part of the price of that commodity, is to be found in that country.
The rent of land, therefore, considered as the price paid for the use of the land, is naturally a monopoly price. It is not at all proportioned to what the landlord may have laid out upon the improvement of the land, or to what he can afford to take, but to what the farmer can afford to give.
Such parts only of the produce of land can commonly be brought to market, of which the ordinary price is sufficient to replace the stock which must be employed in bringing them thither, together with its ordinary profits. If the ordinary price is more than this, the surplus part of it will naturally go to the rent of the land. If it is not more, though the commodity may be brought to market, it can afford no rent to the landlord. Whether the price is, or is not more, depends upon the demand.
There are some parts of the produce of land, for which the demand must always be such as to afford a greater price than what is sufficient to bring them to market; and there are others for which it either may or may not be such as to afford this greater price. The former must always afford a rent to the landlord. The latter sometimes may and sometimes may not, according to different circumstances.
Rent, it is to be observed, therefore, enters into the composition of the price of commodities in a different way from wages and profit. High or low wages and profit are the causes of high or low price; high or low rent is the effect of it. It is because high or low wages and profit must be paid, in order to bring a particular commodity to market, that its price is high or low. But it is because its price is high or low, a great deal more, or very little more, or no more, than what is sufficient to pay those wages and profit, that it affords a high rent, or a low rent, or no rent at all.
The particular consideration, first, of those parts of the produce of land which always afford some rent; secondly, of those which sometimes may and sometimes may not afford rent; and, thirdly, of the variations which, in the different periods of improvement, naturally take place in the relative value of those two different sorts of rude produce, when compared both with one another and with manufactured commodities, will divide this chapter into three parts.
PART I.—Of the Produce of Land which always affords Rent.
As men, like all other animals, naturally multiply in proportion to the means of their subsistence, food is always more or less in demand. It can always purchase or command a greater or smaller quantity of labour, and somebody can always be found who is willing to do something in order to obtain it. The quantity of labour, indeed, which it can purchase, is not always equal to what it could maintain, if managed in the most economical manner, on account of the high wages which are sometimes given to labour; but it can always purchase such a quantity of labour as it can maintain, according to the rate at which that sort of labour is commonly maintained in the neighbourhood.
But land, in almost any situation, produces a greater quantity of food than what is sufficient to maintain all the labour necessary for bringing it to market, in the most liberal way in which that labour is ever maintained. The surplus, too, is always more than sufficient to replace the stock which employed that labour, together with its profits. Something, therefore, always remains for a rent to the landlord.
The most desert moors in Norway and Scotland produce some sort of pasture for cattle, of which the milk and the increase are always more than sufficient, not only to maintain all the labour necessary for tending them, and to pay the ordinary profit to the farmer or the owner of the herd or flock, but to afford some small rent to the landlord. The rent increases in proportion to the goodness of the pasture. The same extent of ground not only maintains a greater number of cattle, but as they are brought within a smaller compass, less labour becomes requisite to tend them, and to collect their produce. The landlord gains both ways; by the increase of the produce, and by the diminution of the labour which must be maintained out of it.
The rent of land not only varies with its fertility, whatever be its produce, but with its situation, whatever be its fertility. Land in the neighbourhood of a town gives a greater rent than land equally fertile in a distant part of the country. Though it may cost no more labour to cultivate the one than the other, it must always cost more to bring the produce of the distant land to market. A greater quantity of labour, therefore, must be maintained out of it; and the surplus, from which are drawn both the profit of the farmer and the rent of the landlord, must be diminished. But in remote parts of the country, the rate of profit, as has already been shewn, is generally higher than in the neighbourhood of a large town. A smaller proportion of this diminished surplus, therefore, must belong to the landlord.
Good roads, canals, and navigable rivers, by diminishing the expense of carriage, put the remote parts of the country more nearly upon a level with those in the neighbourhood of the town. They are upon that account the greatest of all improvements. They encourage the cultivation of the remote, which must always be the most extensive circle of the country. They are advantageous to the town by breaking down the monopoly of the country in its neighbourhood. They are advantageous even to that part of the country. Though they introduce some rival commodities into the old market, they open many new markets to its produce. Monopoly, besides, is a great enemy to good management, which can never be universally established, but in consequence of that free and universal competition which forces every body to have recourse to it for the sake of self defence. It is not more than fifty years ago, that some of the counties in the neighbourhood of London petitioned the parliament against the extension of the turnpike roads into the remoter counties. Those remoter counties, they pretended, from the cheapness of labour, would be able to sell their grass and corn cheaper in the London market than themselves, and would thereby reduce their rents, and ruin their cultivation. Their rents, however, have risen, and their cultivation has been improved since that time.
A corn field of moderate fertility produces a much greater quantity of food for man, than the best pasture of equal extent. Though its cultivation requires much more labour, yet the surplus which remains after replacing the seed and maintaining all that labour, is likewise much greater. If a pound of butcher’s meat, therefore, was never supposed to be worth more than a pound of bread, this greater surplus would everywhere be of greater value and constitute a greater fund, both for the profit of the farmer and the rent of the landlord. It seems to have done so universally in the rude beginnings of agriculture.
But the relative values of those two different species of food, bread and butcher’s meat, are very different in the different periods of agriculture. In its rude beginnings, the unimproved wilds, which then occupy the far greater part of the country, are all abandoned to cattle. There is more butcher’s meat than bread; and bread, therefore, is the food for which there is the greatest competition, and which consequently brings the greatest price. At Buenos Ayres, we are told by Ulloa, four reals, one-and-twenty pence halfpenny sterling, was, forty or fifty years ago, the ordinary price of an ox, chosen from a herd of two or three hundred. He says nothing of the price of bread, probably because he found nothing remarkable about it. An ox there, he says, costs little more than the labour of catching him. But corn can nowhere be raised without a great deal of labour; and in a country which lies upon the river Plate, at that time the direct road from Europe to the silver mines of Potosi, the money-price of labour could be very cheap. It is otherwise when cultivation is extended over the greater part of the country. There is then more bread than butcher’s meat. The competition changes its direction, and the price of butcher’s meat becomes greater than the price of bread.
By the extension, besides, of cultivation, the unimproved wilds become insufficient to supply the demand for butcher’s meat. A great part of the cultivated lands must be employed in rearing and fattening cattle; of which the price, therefore, must be sufficient to pay, not only the labour necessary for tending them, but the rent which the landlord, and the profit which the farmer, could have drawn from such land employed in tillage. The cattle bred upon the most uncultivated moors, when brought to the same market, are, in proportion to their weight or goodness, sold at the same price as those which are reared upon the most improved land. The proprietors of those moors profit by it, and raise the rent of their land in proportion to the price of their cattle. It is not more than a century ago, that in many parts of the Highlands of Scotland, butcher’s meat was as cheap or cheaper than even bread made of oatmeal. The Union opened the market of England to the Highland cattle. Their ordinary price, at present, is about three times greater than at the beginning of the century, and the rents of many Highland estates have been tripled and quadrupled in the same time. In almost every part of Great Britain, a pound of the best butcher’s meat is, in the present times, generally worth more than two pounds of the best white bread; and in plentiful years it is sometimes worth three or four pounds.
It is thus that, in the progress of improvement, the rent and profit of unimproved pasture come to be regulated in some measure by the rent and profit of what is improved, and these again by the rent and profit of corn. Corn is an annual crop; butcher’s meat, a crop which requires four or five years to grow. As an acre of land, therefore, will produce a much smaller quantity of the one species of food than of the other, the inferiority of the quantity must be compensated by the superiority of the price. If it was more than compensated, more corn-land would be turned into pasture; and if it was not compensated, part of what was in pasture would be brought back into corn.
This equality, however, between the rent and profit of grass and those of corn; of the land of which the immediate produce is food for cattle, and of that of which the immediate produce is food for men, must be understood to take place only through the greater part of the improved lands of a great country. In some particular local situations it is quite otherwise, and the rent and profit of grass are much superior to what can be made by corn.
Thus, in the neighbourhood of a great town, the demand for milk, and for forage to horses, frequently contribute, together with the high price of butcher’s meat, to raise the value of grass above what may be called its natural proportion to that of corn. This local advantage, it is evident, cannot be communicated to the lands at a distance.
Particular circumstances have sometimes rendered some countries so populous, that the whole territory, like the lands in the neighbourhood of a great town, has not been sufficient to produce both the grass and the corn necessary for the subsistence of their inhabitants. Their lands, therefore, have been principally employed in the production of grass, the more bulky commodity, and which cannot be so easily brought from a great distance; and corn, the food of the great body of the people, has been chiefly imported from foreign countries. Holland is at present in this situation; and a considerable part of ancient Italy seems to have been so during the prosperity of the Romans. To feed well, old Cato said, as we are told by Cicero, was the first and most profitable thing in the management of a private estate; to feed tolerably well, the second; and to feed ill, the third. To plough, he ranked only in the fourth place of profit and advantage. Tillage, indeed, in that part of ancient Italy which lay in the neighbour hood of Rome, must have been very much discouraged by the distributions of corn which were frequently made to the people, either gratuitously, or at a very low price. This corn was brought from the conquered provinces, of which several, instead of taxes, were obliged to furnish a tenth part of their produce at a stated price, about sixpence a-peck, to the republic. The low price at which this corn was distributed to the people, must necessarily have sunk the price of what could be brought to the Roman market from Latium, or the ancient territory of Rome, and must have discouraged its cultivation in that country.
Musean translation
Mouseia’s complete machine-assisted Musean translation, made directly from the complete English text of all five books for fidelity, the author’s force and cadence, and modern clarity.
OF THE RENT OF LAND.
Rent, regarded as the price paid for the use of land, is naturally the highest sum a tenant can afford in the land’s actual circumstances. In setting the terms of the lease, the landlord tries to leave him no more of the produce than is needed to maintain the stock from which he supplies seed, pays labor, and buys and maintains cattle and other farming equipment, together with the ordinary profits of farming stock in the neighborhood. This is clearly the least the tenant can accept without losing money, and the landlord seldom intends to leave him more. Whatever part of the produce—or, equivalently, of its price—exceeds that share, the landlord naturally tries to keep as rent: clearly the most the tenant can afford to pay under the circumstances. Sometimes the landlord’s generosity, and more often his ignorance, leads him to accept somewhat less. On rarer occasions the tenant’s ignorance leads him to promise somewhat more, or to accept somewhat less than the ordinary profit on farming stock in the neighborhood. This share, nevertheless, may be regarded as the natural rent of land, or the rent at which land is naturally expected, for the most part, to be leased.
It might be thought that land rent is often nothing more than a reasonable profit or interest on the stock the landlord has spent improving it. This may, no doubt, sometimes be partly true; it can scarcely ever be wholly true. A landlord demands rent even for unimproved land, and the supposed interest or profit on the cost of improvement is generally added to this original rent. Moreover, improvements are not always made with the landlord’s stock; sometimes the tenant pays for them. When the lease is renewed, however, the landlord ordinarily demands the same increase in rent as if he had paid for them all himself.
Sometimes he demands rent for something wholly incapable of human improvement. Kelp is a kind of seaweed which, when burned, yields an alkaline salt useful in making glass, soap, and for several other purposes. In parts of Great Britain, particularly Scotland, it grows only on rocks below the high-water mark, covered by the sea twice a day. Human industry has therefore never increased their produce. Yet a landlord whose estate borders a kelp-bearing shore demands rent for it just as he does for his cornfields.
The sea around the Shetland islands is unusually rich in fish, which furnish much of the inhabitants’ food. But to profit from the produce of the water, they need a home on the neighboring land. The landlord’s rent is proportioned not to what a farmer can earn from the land alone, but to what he can earn from both land and water. Part of it is paid in sea fish; and one of the very few cases where rent forms part of the price of that commodity is found in this country.
Rent, then, considered as the price paid for using land, is naturally a monopoly price. It is proportioned neither to what the landlord has spent improving the land nor to what he can afford to accept, but to what the farmer can afford to pay.
Ordinarily, only those parts of the land’s produce whose usual price is enough to replace the stock employed in bringing them to market, together with its ordinary profits, can reach the market. If the ordinary price exceeds this amount, the surplus naturally goes toward land rent. If it does not, the commodity may still reach the market but can yield the landlord no rent. Whether the price exceeds it depends on demand.
For some kinds of land produce, demand must always bring a price above what is needed to get them to market; for others, it may or may not bring such a price. The former must always yield the landlord rent. The latter may or may not, depending on circumstances.
We must observe, therefore, that rent enters into the price of commodities differently from wages and profit. High or low wages and profit are causes of high or low prices; high or low rent is their effect. A commodity’s price is high or low because high or low wages and profit must be paid to bring it to market. But it yields high rent, low rent, or none at all because its price exceeds the amount needed to pay those wages and profit by a great deal, a little, or not at all.
A particular examination, first, of the parts of land produce that always yield some rent; second, of those that sometimes do and sometimes do not; and third, of the changes occurring naturally at different stages of improvement in the relative values of these two kinds of raw produce, both to each other and to manufactured goods, will divide this chapter into three parts.
PART I.—Of the Produce of Land That Always Yields Rent.
Because humans, like all other animals, naturally multiply in proportion to their means of subsistence, food is always in some demand. It can always buy or command some amount of labor, and someone can always be found willing to do something to obtain it. The amount of labor it can buy is not always as much as it could support if managed with the greatest economy, because labor is sometimes paid high wages. But it can always buy as much labor as it can support at the customary rate for maintaining that kind of labor in the neighborhood.
Land in almost any situation produces more food than is needed to support, even at the most generous rate of maintenance, all the labor required to bring it to market. The surplus is also always more than enough to replace the stock that employed the labor, together with its profits. Something therefore always remains as rent for the landlord.
Even the most barren moors of Norway and Scotland provide some pasture for cattle. Their milk and increase are always more than enough not only to support all the labor needed to tend them and pay the ordinary profit to the farmer or owner of the herd or flock, but also to yield a little rent to the landlord. Rent rises with the quality of the pasture. The same area supports more cattle; and since they are kept closer together, less labor is needed to tend them and collect their produce. The landlord gains in both ways: from increased produce and from reduced labor that must be supported out of it.
Rent varies not only with fertility, whatever the land produces, but also with location, however fertile it is. Land near a town yields higher rent than equally fertile land in a distant part of the country. Cultivating one may cost no more labor than cultivating the other, but bringing the distant land’s produce to market must always cost more. More labor must therefore be supported from its produce, reducing the surplus from which both the farmer’s profit and the landlord’s rent are drawn. But, as already shown, the rate of profit is generally higher in remote districts than near a large town. An even smaller share of this reduced surplus must therefore go to the landlord.
Good roads, canals, and navigable rivers reduce transport costs and put remote districts more nearly on a level with those near a town. For that reason they are the greatest improvements of all. They encourage cultivation of remote land, which must always make up the largest part of the country. They benefit the town by breaking the monopoly held by its surrounding countryside. They benefit even that countryside: though they introduce competing goods to its old market, they open many new markets for its produce. Monopoly, moreover, is a great enemy of good management, which can become universal only through free and universal competition, compelling everyone to practice it in self-defense. Not more than fifty years ago, some counties near London petitioned parliament against extending turnpike roads to more distant counties. They claimed those counties, with their cheap labor, could sell grass and corn in the London market for less than they could, lowering their rents and ruining their cultivation. Since then, however, their rents have risen and their cultivation has improved.
A cornfield of moderate fertility produces far more food for humans than the best pasture of equal size. Though growing corn requires much more labor, the surplus left after replacing the seed and supporting all that labor is also much greater. If a pound of butcher’s meat were never considered worth more than a pound of bread, this greater surplus would everywhere have greater value and provide a greater fund for both the farmer’s profit and the landlord’s rent. This seems to have been the universal case in the early, undeveloped stages of agriculture.
But the relative values of bread and butcher’s meat, these two kinds of food, differ greatly at different stages of agriculture. In its early stages, the unimproved wilds covering most of the country are all left to cattle. There is more meat than bread; competition is therefore greatest for bread, which accordingly commands the higher price. According to Ulloa, at Buenos Ayres four reals, one-and-twenty pence halfpenny sterling, was, forty or fifty years ago, the usual price of an ox chosen from a herd of two or three hundred. He says nothing about the price of bread, probably because he found nothing remarkable in it. Catching an ox, he says, costs little more than the labor involved. Corn, however, cannot be raised anywhere without considerable labor; and in a country on the river Plate, then the direct route from Europe to the silver mines of Potosi, the money price of labor could be very cheap. Matters change when cultivation spreads across most of the country. Bread then becomes more plentiful than meat. Competition shifts direction, and the price of butcher’s meat rises above the price of bread.
As cultivation spreads, moreover, the unimproved wilds become inadequate to meet the demand for butcher’s meat. Much cultivated land must be devoted to raising and fattening cattle. Their price must consequently cover not only the labor required to tend them, but also the rent the landlord and the profit the farmer could have obtained from growing crops on that land. Cattle bred on the least cultivated moors, when taken to the same market, sell at the same price, according to weight or quality, as cattle raised on the most improved land. The owners of the moors benefit and raise their rents in proportion to the price of cattle. Not more than a century ago, in many parts of the Scottish Highlands, butcher’s meat cost no more than, or even less than, bread made from oatmeal. The Union opened the English market to Highland cattle. Their usual price is now about three times what it was at the beginning of the century, and rents on many Highland estates have tripled or quadrupled over the same period. In nearly every part of Great Britain today, a pound of the best butcher’s meat is generally worth more than two pounds of the best white bread; in abundant years, it is sometimes worth three or four pounds.
Thus, as improvement advances, the rent and profit of unimproved pasture come to be governed in some measure by those of improved pasture, and these in turn by the rent and profit of corn land. Corn is an annual crop; butcher’s meat takes four or five years to grow. Since an acre of land produces much less of one kind of food than the other, its lower quantity must be offset by a higher price. If the price more than offset it, more corn land would become pasture; if it failed to offset it, some pasture would revert to corn.
This equality between the rent and profit of grass and those of corn—between land whose immediate produce feeds cattle and land whose immediate produce feeds people—must, however, be understood as applying only across most improved lands of a great country. In certain local situations things are quite different, and grass yields much higher rent and profit than corn could.
Thus, near a great town, demand for milk and horse fodder, together with the high price of butcher’s meat, often raises the value of grass beyond what might be called its natural proportion to the value of corn. Clearly this local advantage cannot extend to distant lands.
Particular circumstances have sometimes made countries so populous that their entire territory, like the lands near a great town, cannot produce both the grass and corn needed to sustain their inhabitants. Their land has therefore been used chiefly to produce grass, the bulkier commodity, which cannot be transported so easily from far away. Corn, the food of the great body of the people, has chiefly been imported. Holland is now in this position, and much of ancient Italy seems to have been so during Roman prosperity. According to Cicero, old Cato said that the first and most profitable practice in managing a private estate was to feed cattle well; the second, to feed them tolerably well; and the third, to feed them poorly. He placed plowing only fourth in profitability and advantage. Cultivation near Rome in ancient Italy must indeed have been greatly discouraged by the distributions of corn often made to the people free of charge or at a very low price. This corn came from conquered provinces, several of which, in place of taxes, were required to supply the republic a tenth of their produce at a fixed price of about sixpence a peck. The low price at which it was distributed to the people must necessarily have depressed the price of corn brought to the Roman market from Latium, the ancient territory of Rome, and discouraged cultivation there.
Plain English translation
Mouseia’s complete Plain English edition, made independently and directly from the complete English text of all five books.
ON THE RENT OF LAND.
Rent, as the price paid to use land, is normally the highest amount the tenant can afford in the land's actual condition. When agreeing on a lease, the landlord tries to leave the tenant only enough of the produce to replace the stock used to supply seed, pay workers, and buy and keep livestock and other farming equipment, plus the ordinary profit on farming stock in the area. This is plainly the smallest share the tenant can accept without losing money. The landlord seldom intends to leave him more. The landlord normally tries to take as rent everything above that share, whether it is produce or the money earned by selling the produce. In the land's actual condition, this is clearly the most the tenant can afford to pay. Sometimes a landlord accepts a little less, through generosity but more often through ignorance. Less often, a tenant's ignorance leads him to promise a little more, accepting less than the ordinary profit on farming stock nearby. Even so, this amount can be considered the natural rent of land: the rent at which land will normally be leased.
One might think that land rent is often just a reasonable profit or interest on the stock a landlord spent improving the land. That may sometimes explain part of the rent, but can hardly explain all of it. A landlord charges rent even for unimproved land. The supposed interest or profit on improvement costs is generally added to this original rent. Moreover, improvements are not always paid for with the landlord's stock; sometimes the tenant pays for them. Yet when the lease is renewed, the landlord usually raises the rent just as much as if he had paid for every improvement himself.
A landlord sometimes charges rent for land that people cannot improve at all. Kelp is a kind of seaweed that produces an alkaline salt when burned. The salt is useful for making glass, soap, and other things. In several parts of Great Britain, especially Scotland, kelp grows only on rocks below the high-water mark. The sea covers them twice every day, so human effort has never increased their output. Yet a landlord whose property includes such a kelp-covered shore charges rent for it just as he does for his cornfields.
The sea around the Shetland islands has an unusually plentiful supply of fish, which provide much of the inhabitants' food. But to benefit from what the water produces, they need homes on the nearby land. The landlord's rent therefore reflects not just what a farmer can earn from the land but what he can earn from the land and the water together. Some of the rent is paid in sea fish. This is one of the very few cases in which rent forms part of that product's price.
Land rent, then, when understood as the price for using land, is naturally a monopoly price. It bears no relation to what the landlord may have spent improving the land or to the amount he can afford to accept. It depends on what the farmer can afford to pay.
Usually, only produce whose ordinary selling price can replace the stock needed to bring it to market, along with the ordinary profit on that stock, can be brought to market. If the ordinary price exceeds that amount, the excess will naturally become land rent. If it does not exceed it, the product may still be brought to market but will provide no rent to the landlord. Demand determines whether the price exceeds that amount.
Demand for some kinds of land produce must always bring a price higher than the cost of bringing them to market. Demand for other kinds may or may not bring such a price. The first group must always bring landlords rent. The second may or may not, depending on circumstances.
Notice, then, that rent contributes to the price of goods in a different way from wages and profit. High or low wages and profit cause high or low prices. High or low rent results from high or low prices. A product's price is high or low because the wages and profit needed to bring it to market are high or low. But the product provides high rent, low rent, or none because its price exceeds those wages and profit by a lot, by a little, or not at all.
This chapter will have three parts. First I will examine types of land produce that always bring some rent. Then I will examine those that sometimes do and sometimes do not. Finally I will examine how, at different stages of improvement, the relative values of these two kinds of raw produce naturally change, both against each other and against manufactured goods.
PART I.—On Land Produce That Always Brings Rent.
People, like all other animals, naturally increase in number according to the food available to support them. Food is therefore always in some demand. It can always buy the work of some number of people, and someone can always be found willing to work to get it. Because wages can be high, the amount of labor food can buy is not always as great as the amount it could support if used as economically as possible. But it can always buy as much labor as it can support at the usual local cost of supporting that kind of worker.
In almost any place, however, land produces more food than is needed to support, even generously, all the labor required to bring that food to market. The extra food is also always more than enough to replace the stock that employed the workers and pay a profit on it. Something is therefore always left over as rent for the landlord.
Even the bleakest moors of Norway and Scotland provide some grazing for cattle. Their milk and the new animals born are worth more than enough to support everyone needed to look after them and to pay the farmer or herd owner the ordinary profit. They also provide a small rent to the landlord. Rent rises as the quality of the grazing improves. The same area supports more cattle, and because they graze closer together, fewer workers are needed to care for them and gather what they produce. The landlord gains both from increased output and from needing to support less labor out of it.
Land rent varies not only with the fertility of the land, whatever it produces, but also with its location, however fertile it is. Land near a town brings more rent than equally fertile land far away. The two may take the same amount of labor to cultivate, but bringing the distant land's produce to market always costs more. More labor must therefore be supported out of that produce, leaving less extra revenue for both the farmer's profit and the landlord's rent. As already shown, the rate of profit in remote areas is generally higher than near a large town. So the landlord must receive a smaller share of that already reduced extra revenue.
Good roads, canals, and navigable rivers reduce transport costs and put remote areas on a footing more nearly equal to areas close to town. They are therefore the greatest improvements of all. They encourage cultivation in the more distant areas, which must always make up the largest part of a country. Towns benefit because better transport breaks the nearby countryside's monopoly over supplying them. Even that nearby countryside benefits. Though competing products enter its old market, many new markets open for its own products. Moreover, monopoly is a major obstacle to good management. Good management cannot spread everywhere except through free and widespread competition, which forces everyone to adopt it for self-defense. No more than fifty years ago, some counties near London petitioned parliament to oppose extending toll roads to more remote counties. They claimed that cheap labor would allow those counties to sell grass and corn more cheaply than they could in the London market, reducing their rents and ruining their farming. Since then, however, their rents have risen and their farming has improved.
A cornfield of moderate fertility produces far more food for people than an equally large area of even the best pasture. Corn takes much more work to grow, but after replacing the seed and supporting all that labor, far more is left over. If a pound of butcher's meat were never considered worth more than a pound of bread, this greater surplus would everywhere be more valuable and provide more for both the farmer's profit and the landlord's rent. That seems to have happened everywhere in the early stages of farming.
But the relative values of bread and butcher's meat change greatly as farming develops. At its earliest stage, the unimproved open land covering most of the country is given over to cattle. There is more meat than bread. Bread therefore faces more competition among buyers and commands a higher price. Ulloa tells us that at Buenos Ayres, forty or fifty years ago, the usual price of an ox chosen from a herd of two or three hundred was four reals, one-and-twenty pence halfpenny sterling. He says nothing about the price of bread, probably because he found nothing unusual about it. He says an ox there costs little more than the work of catching it. Corn, however, takes considerable labor to grow anywhere. And money wages could be very low in a country along the river Plate, then the direct route from Europe to the silver mines of Potosi. The situation changes when farming spreads across most of the country. There is then more bread than meat. Buyers compete more for meat, which becomes more expensive than bread.
As cultivation spreads, moreover, the remaining unimproved open land cannot meet the demand for meat. Much cultivated land must be used to raise and fatten cattle. Their price must therefore pay not just for the work of tending them but also the rent the landlord and the profit the farmer could have earned by growing crops on that land. Cattle raised on the least cultivated moors sell in the same market at the same price as cattle raised on the best-improved land, allowing for differences in weight or quality. The owners of the moors benefit and raise their rents as the price of their cattle rises. No more than a century ago, in many parts of the Highlands of Scotland, meat cost no more than bread made from oatmeal, and sometimes cost less. The Union opened England's market to Highland cattle. Their usual price is now about three times what it was at the beginning of the century. Rents on many Highland estates have tripled or quadrupled over the same period. Today, in almost every part of Great Britain, a pound of the best meat is generally worth more than two pounds of the best white bread. In plentiful years it is sometimes worth three or four pounds.
As land is improved, the rent and profit of unimproved pasture thus come to depend to some extent on the rent and profit of improved pasture. These in turn depend on the rent and profit of land growing corn. Corn produces a crop each year, while meat takes four or five years to produce. Since an acre produces much less of the latter food, its higher price must make up for the smaller amount. If the higher price more than made up for it, more corn-growing land would become pasture. If it did not, some pasture would be converted back to corn-growing land.
This balance between rent and profit from pasture and from corn-growing land—between land directly producing cattle feed and land directly producing human food—holds only across most of the improved land in a large country. In certain places the situation is very different: pasture brings much higher rent and profit than corn can.
Near a large town, for example, demand for milk and horse feed often combines with the high price of meat to raise the value of pasture above its normal relation to the value of corn-growing land. Clearly, land far away cannot share this local advantage.
Special conditions have sometimes made entire countries so crowded that their land, like land near a large town, cannot grow both enough grass and enough corn for the people who live there. Most of their land is therefore devoted to grass. Grass is bulkier and harder to bring from far away. Corn, the main food of most people, is chiefly imported from other countries. Holland is in this position now. A substantial part of ancient Italy seems to have been in the same position during Rome's prosperous period. According to Cicero, old Cato said the first and most profitable use of a private estate was to feed livestock well; the second was to feed them reasonably well; the third was to feed them poorly. He put plowing only in fourth place for profit and advantage. Growing crops near Rome in ancient Italy must indeed have been strongly discouraged by frequent distributions of corn to the people, either free or very cheaply. The corn came from conquered provinces. Several of these provinces had to supply the republic, in place of taxes, one-tenth of their produce at a fixed price of about sixpence a-peck. Selling this corn to the people at a low price must have lowered the price of corn brought to Rome from Latium, the city's old territory. That would have discouraged crop cultivation there.