OCR Text |
Show soo OF' THE PROFITS 0'' CAPITAL. [cH. v. In the cultivation of land, the itnmediate and n1ain cause of the necessary din1inution of profits appeared to be the increased quantity of labotu necessary to obtain the same produce. In manufactures and comtncrce, it is the fall in the exchangeable value of the products of industry in these departments, con1pated \vith corn and labour. 1"'he cost of producing corn and labour continually increases from inevitable physical causes, while the cost of producing n1anufactures and articles of connncrce son1etimes diminishes, son1etin1es retnains stationary, and ~tall events increases tnuch slo,ver than the cost of producing corn and labour. Upon every principle therefore of den1and and supply, the exchangcaule value of these latter objects Innst fall, cotn pared \Vith the value of Ja .. bour. But if the exchangeable value of labour continues to rise, \vhilc the exchangeable value of n1anufactures either falls, re1nains the san1e, or rises in a rnuch less degre~, profits 1nust continue to fall; and thus it appears that in the progress of itnprovcn1ent, as poorer and poorer land is taken jnto cultivation, the rate of profits must be limited by the po\vers of the soil last cultivated. If the .. last land taken into cultivation can only be made to yield a certain excess of value above the value of the labour necessary to produce it, it is obvious that, upon the principles of con1petition, profits, generally, cannot possibly be higher than this excess will allow. In the ascending scale, this is .a barrier which cannot be passed. But limitation JS essentially different fron1 regulation. In the de SEC. II,] OF THE J>ROFITS OF CAPITAL. 3.01 s<!ending scale, profits may be lower in any degree. There is here no controlling necessity which determines the rate of profits; and below the highest limit which the actual state of the land will allow, ample scope is left for the operation of other causes. SECTION If. Of Profits as affected b!J the Proportion uJhiclt Capital bear$ to Labour. The second n1ain cause \Vhich, by increasing 'the an1ount of advances, influences profits, is the proportion which capital bears to labour.* This is obviously a . cause whicli alone is capable of producing the very greatest effects; and on the supposition of adequate variations taking place between the supplies of capital and the supplies of labour, all the same effects n1ight be produced on profits as by the operation of the first cause, and in a much shorter time. When capital is really abundant compared with labour, nothing- can prevent lo\v profits; and the * I have stated in a former chapter, that the demand for labour does not depend upon capital alone, but upon capital and revenue together, or the value of the whole produce; but to illustrate the present supposit,iun, it is only necrssary to consider capital and labour. We may allow that no difficulty will occur with respect to demand. . |