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Show 1S8 OF THE RENT OF LAND. (cH. III . . can ren1ove and employ in another business ; that the surplus produce possessed by the government soon raises up a population to be employed by it, so as to keep do\¥11 the price of labour in other departments to the level of the price in agrieul ture; and that the sn1a1l den1and for the products of manufacturing and co1nn1ercial industry, O\ving to the poverty of the great 1nass of society, affords no room for the employment of a large capital, with high profits in manufactures and co1nmerce. On account of these causes which tend to lo\ver profits, and the difficulty of collecting n1oney, and the risk of lending it which tend to raise interest, I have long been of opinion, that though the rate of interest in different countries is almost the only criterion from 'v-hich a judgment can be formed of tpe rate of profits; yet that in such countr1es as India and China, and indeed in 1nost of the eastern and southern regions of the globe, it is a criterion subject to the greatest uncertainty. In China, the legal interest of money is three per cent. per tnonth.* But it is impossible to suppose, when we consider the state of China, so far as it is kno\vn to us, that capital en1ployed on land can yield profits to this an1ount; or, indeed, that capital can be en1ployed in any steady and well-known trade with such a return. In the same way extraordinary accounts have been given of the high rate of interest in India; * Penal Code, Staunton, p. 158. The market-rate of interest at Canton is said, however, to b~ only from twelve to eighteen per cent. I d. note X VII. SEC. II.] OF THE RENT OF I.JAND. 159 but the state of the actual cultivators completely contradicts the supposition, that, independently of their labour, the profits upon their stock is so considerable; and the late reduction of the government paper to six per cent. fully proves that, in con1n1on and peaceable times, the returns of capital, which can be depended upon in other sorts of business, are by no means so great as to warrant the borrowing at a very high rate of interest. It is pro.bable that, with the exception of occasional speculations, the money that is borrowed at the high rates of interest noticed in China and India is borrowed in both countries, rather with a vie~ to expenditure or the payn1ent of debts, than with a view to profit. Sotne of the causes, vvhich have been noticed as tending pretnaturely and irregularly to raise rents and lC?\iV.er profits in the count~ies of the east, operated WI thou: do~bt to a certain extent in the early st~ges of society In Europe. At one period most or the land was <fultivated by slaves, and in the metayer systems which succeeded, the division of the crop was so arranged as to allow the cultivator but little more than a scanty subsistence. In this state of things the rate of profits on the land could have but little to do with the general rate of profits. The peasant' could not, without the o-reatest diffi~ul_ty, r~alize money and change his profession; and It IS qutte certain that no one who had accumulated a capital in manufactures and commerce would e1nploy it in cultivating the lands of other~ as a metayer. There would thus be little or no |
