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Show 1 .1~ ON TilE NArfURE AND cotumodities, and the varying facilities which at-tend their production. . · The market prices of gold and stlver depend up_on the quantity of thetn in the market cornpar~d wtth the demand ; and this quantity has been In part. produced by t~e accumulation of hundreds of years, and is but slowly affected by the annual sup-ply from the mines. It is justly stated by Mr. Ricardo::<: ~hat the agree-ment of the market and natural prices of all con1- n1odities, depends at all times upon the fac~lit! with \vhich the supply can be increased or diminished, and he particularly· notices gold, or the precious n1etals, as among the con1n1odities where this effect cannot. be speedily produced. Consequently if by o·reat and sudden itnprovements in n1achinery, 0 both in manufactures and agriculture, the facility of production were generally increased, and the wants of the population were supplied with n1uch less labour, the value of the precious metals compared "rith commodities ought greatly to rise; but, as they could not in a short time be adequately diminished in quantity, the prices of corn1nodities would cease to represent the quantity oflabour etnployed upon them. Another source of variation peculiar to the precious n1etals 'vould be the use that is made of then1 in foreign con1merce; and unless this use \\rere given up, and the exportation and in1portation of then1 were prohibited, it would unquestionably * Principles of Political Economy and Taxation, ch. xiii. p. 255. SEC. V.] MEASURES OF VALUE. 113 answer to some countries possessing peculiar advantages in their exportable comrnodities, to buy their gold and silver abroad rather than procure the1n at home. At this present mo1nent, I believe it is unquestionably true that England purchases the precious metals with less labour than is applied to obtain then1 directly frorn the n1ines of 1\!Iexico. But if they could be imported by son1e countries fron1 abroad \vith less labour than they could be obtained at home, it would ansvver to other countries to export then1 in exchange for con11nodities, which they either could not produce on their o'vn s9il, or could obtain cheaper else\V here. ...t\nd thu~, in reference to the relative valu.e of comn1odities ?oth in different countries at the san1e period, and In the san1e country at different periods, it is obvious that the prices in rnoney n1ight be subject to • considerable variations, vvithout beino· accompa- .d b nte by any proportionate variations in the quan-tities of labour which they had cost. The objections hitherto considered in this and the preceding sections are some of those which present themselves upon the supposition that each nation possessed mines, or even could procure at home the precious n1etals at all titnes 'vith the same quantity of labour vvithout capital· but the~e . ' ' 1t n1ust be allowed, are extravagant hypotheses. If ho,vever w~e were to assu1ne the more natural one of tl~e mines, wherever they are, and in all ages: costing alvvays the same quantity of labour and capital in the working, \Ve should see immediately. fro1~1 the present distribution of the precious tne- I |