An Inquiry into the Nature and Causes of the Wealth of Nations - Adam Smith (ebooks children's books free .TXT) 📗
- Author: Adam Smith
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can get no rent, but, which he must either work himself or let it alone
altogether, the price of coals must generally be nearly about this price.
Rent, even where coals afford one, has generally a smaller share in their
price than in that of most other parts of the rude produce of land. The rent
of an estate above ground, commonly amounts to what is supposed to be a
third of the gross produce; and it is generally a rent certain and
independent of the occasional variations in the crop. In coal mines, a fifth
of the gross produce is a very great rent, a tenth the common rent ; and it
is seldom a rent certain, but depends upon the occasional variations in the
produce. These are so great, that in a country where thirty years purchase
is considered as a moderate price for the property of a landed estate, ten
years purchase is regarded as a good price for that of a coal mine.
The value of a coal mine to the proprietor, frequently depends as much upon
its situation as upon its fertility. That of a metallic mine depends more
upon its fertility, and less upon its situation. The coarse, and still more
the precious metals, when separated from the ore, are so valuable, that they
can generally bear the expense of a very long land, and of the most distant
sea carriage. Their market is not confined to the countries in the
neighbourhood of the mine, but extends to the whole world. The copper of
Japan makes an article of commerce in Europe; the iron of Spain in that of
Chili and Peru. The silver of Peru finds its way, not only to Europe, but
from Europe to China.
The price of coals in Westmoreland or Shropshire can have little effect on
their price at Newcastle ; and their price in the Lionnois can have none at
all. The productions of such distant coal mines can never be brought into
competition with one another. But the productions of the most distant
metallic mines frequently may, and in fact commonly are.
The price, therefore, of the coarse, and still more that of the precious
metals, at the most fertile mines in the world, must necessarily more or
less affect their price at every other in it. The price of copper in Japan
must have some influence upon its price at the copper mines in Europe. The
price of silver in Peru, or the quantity either of labour or of other goods
which it will purchase there, must have some influence on its price, not
only at the silver mines of Europe, but at those of China. After the
discovery of the mines of Peru, the silver mines of Europe were, the greater
part of them, abandoned. The value of silver was so much reduced, that their
produce could no longer pay the expense of working them, or replace, with a
profit, the food, clothes, lodging, and other necessaries which were
consumed in that operation. This was the case, too, with the mines of Cuba
and St. Domingo, and even with the ancient mines of Peru, after the
discovery of those of Potosi.
The price of every metal, at every mine, therefore, being regulated in some
measure by its price at the most fertile mine in the world that is actually
wrought, it can, at the greater part of mines, do very little more than pay
the expense of working, and can seldom afford a very high rent to the
landlord. Rent accordingly, seems at the greater part of mines to have but a
small share in the price of the coarse, and a still smaller in that of the
precious metals. Labour and profit make up the greater part of both.
A sixth part of the gross produce may be reckoned the average rent of the
tin mines of Cornwall, the most fertile that are known in the world, as we
are told by the Rev. Mr. Borlace, vice-warden of the stannaries. Some, he
says, afford more, and some do not afford so much. A sixth part of the gross
produce is the rent, too, of several very fertile lead mines in Scotland.
In the silver mines of Peru, we are told by Frezier and Ulloa, the
proprietor frequently exacts no other acknowledgment from the undertaker of
the mine, but that he will grind the ore at his mill, paying him the
ordinary multure or price of grinding. Till 1736, indeed, the tax of the
king of Spain amounted to one fifth of the standard silver, which till then
might be considered as the real rent of the greater part of the silver mines
of Peru, the richest which have been known in the world. If there had been
no tax, this fifth would naturally have belonged to the landlord, and many
mines might have been wrought which could not then be wrought, because they
could not afford this tax. The tax of the duke of Cornwall upon tin is
supposed to amount to more than five per cent. or one twentieth part of the
value ; and whatever may be his proportion, it would naturally, too, belong
to the proprietor of the mine, if tin was duty free. But if you add one
twentieth to one sixth, you will find that the whole average rent of the tin
mines of Cornwall, was to the whole average rent of the silver mines of
Peru, as thirteen to twelve. But the silver mines of Peru are not now able
to pay even this low rent; and the tax upon silver was, in 1736, reduced
from one fifth to one tenth. Even this tax upon silver, too, gives more
temptation to smuggling than the tax of one twentieth upon tin; and
smuggling must be much easier in the precious than in the bulky commodity.
The tax of the king of Spain, accordingly, is said to be very ill paid, and
that of the duke of Cornwall very well. Rent, therefore, it is probable,
makes a greater part of the price of tin at the most fertile tin mines than
it does of silver at the most fertile silver mines in the world. After
replacing the stock employed in working those different mines, together with
its ordinary profits, the residue which remains to the proprietor is
greater, it seems, in the coarse, than in the precious metal.
Neither are the profits of the undertakers of silver mines commonly very
great in Peru.The same most respectable and well-informed authors acquaint
us, that when any person undertakes to work a new mine in Peru, he is
universally looked upon as a man destined to bankruptcy and ruin, and is
upon that account shunned and avoided by every body.Mining, it seems, is
considered there in the same light as here, as a lottery, in which the
prizes do not compensate the blanks, though the greatness of some tempts
many adventurers to throw away their fortunes in such unprosperous projects.
As the sovereign, however, derives a considerable part of his revenue from the produce
of silver mines, the law in Peru gives every possible encouragement to the
discovery and working of new ones. Whoever discovers a new mine, is entitled
to measure off two hundred and forty-six feet in length, according to what
he supposes to be the direction of the vein, and half as much in breadth. He
becomes proprietor of this portion of the mine, and can work it without
paving any acknowledgment to the landlord. The interest of the duke of
Cornwall has given occasion to a regulation nearly of the same kind in that
ancient dutchy. In waste and uninclosed lands, any person who discovers a
tin mine may mark out its limits to a certain extent, which is called
bounding a mine. The bounder becomes the real proprietor of the mine, and
may either work it himself, or give it in lease to another, without the
consent of the owner of the land, to whom, however, a very small
acknowdedgment must be paid upon working it. In both regulations, the sacred
rights of private property are sacrificed to the supposed interests of
public revenue.
The same encouragement is given in Peru to the discovery and working of new
gold mines; and in gold the king’s tax amounts only to a twentieth part of
the standard rental. It was once a fifth, and afterwards a tenth, as in
silver; but it was found that the work could not bear even the lowest of
these two taxes. If it is rare, however, say the same authors, Frezier and
Ulloa, to find a person who has made his fortune by a silver, it is still
much rarer to find one who has done so by a gold mine. This twentieth part
seems to be the whole rent which is paid by the greater part of the gold
mines of Chili and Peru. Gold, too, is much more liable to be smuggled than
even silver; not only on account of the superior value of the metal in
proportion to its bulk, but on account of the peculiar way in which nature
produces it. Silver is very seldom found virgin, but, like most other
metals, is generally mineralized with some other body, from which it is
impossible to separate it in such quantities as will pay for the expense,
but by a very laborious and tedious operation, which cannot well be carried
on but in workhouses erected for the purpose, and, therefore, exposed to
the inspection of the king’s officers. Gold, on the contrary, is almost
always found virgin. It is sometimes found in pieces of some bulk ; and,
even when mixed, in small and almost insensible particles, with sand, earth,
and other extraneous bodies, it can be separated from them by a very short
and simple operation, which can be carried on in any private house by any
body who is possessed of a small quantity of mercury. If the king’s tax,
therefore, is but ill paid upon silver, it is likely to be much worse paid
upon gold; and rent must make a much smaller part of the price of gold than
that of silver.
The lowest price at which the precious metals can be sold, or the smallest
quantity of other goods for which they can be exchanged, during any
considerable time, is regulated by the same principles which fix the lowest
ordinary price of all other goods. The stock which must commonly be
employed, the food, clothes, and lodging, which must commonly be consumed in
bringing them from the mine to the market, determine it. It must at least be
sufficient to replace that stock, with the ordinary profits.
Their highest price, however, seems not to be necessarily determined by any
thing but the actual scarcity or plenty of these metals themselves. It is
not determined by that of any other commodity, in the same manner as the
price of coals is by that of wood, beyond which no scarcity can ever raise
it. Increase the scarcity of gold to a certain degree, and the smallest bit
of it may become more precious than a diamond, and exchange for a greater
quantity of other goods.
The demand for those metals arises partly from their utility, and partly
from their beauty. If you except iron, they are more useful than, perhaps,
any other metal. As they are less liable to rust and impurity, they can more
easily be kept clean; and the utensils, either of the table or the kitchen,
are often, upon that account, more agreeable when made of them. A silver
boiler is more cleanly than a lead, copper, or tin one; and the same quality
would render a gold boiler still better than
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