If your statement[93] was correct, this extravagant consequence would
follow from it: That in proportion as population increased and worse
land was brought under cultivation, the proportion of produce to the
corn expenses of procuring it would increase. If we now had twenty
millions of quarters with an expense of five millions of quarters, we
should when we expended ten millions of quarters obtain more than
forty[94], notwithstanding that in the latter period many more than
double the quantity of hands were employed in cultivation in consequence
of the poorer quality of the land. If this be true, the principle of
population is false, because the more you increase the people, the
greater surplus of abundance will appear. Your statement is however very
ingenious, and carries a great deal of plausibility with it; but I think
you err in supposing it possible that the proportion of the whole corn
expenditure to the produce obtained can fall, with an increase of the
price of corn. The two are incompatible; either the whole corn expenses
of production will be increased or not. If they be, the price of corn
will rise; but, if they be not, I can see no reason for a rise in the
price of corn. I admit that it is only the last portion of capital
employed on the land which will be attended with an increased corn
expense; but, unless it renders the whole produce together at an
increased expense, the price of produce will not rise. Suppose the
produce of the country ten millions of quarters with the price at L4 per
quarter, the number of labourers employed two-and-a-half millions, each
receiving two quarters of corn annually as wages. Suppose too that the
population increases and five millions of quarters more are required,
but that it cannot be obtained with less labour than that of two
millions of men. If we suppose the price to increase in proportion to
the number of men employed, it will rise to L4 16_s._, because to raise
ten millions of quarters an average of three millions of men would be
now required instead of two-and-a-half millions. Suppose now each man to
consume one quarter annually for food and to exchange the remainder for
other necessaries. Fourteen bushels will be sufficient wages for
him[95]; the expenditure of corn for wages will then be for fifteen
millions of produce 7.875.000, and for ten millions 5.250.000. Before,
it was only five millions; consequently the proportion of surplus
produce has diminished.
In making this calculation I have very much favoured your view of the
question, because the price of corn would not, I think, rise in
proportion to the greater number of men employed but to the greater
amount of wages paid; it would not therefore rise to L4 16_s_., but to
L4 4_s_., because as 5 : 5-1/4 :: L4 : L4 4_s_. But, if the price was
only L4 4_s_., more corn would be required by the labourer than fourteen
bushels, that calculation being founded on a greater exchangeable value
of corn. It appears too that your statement if true does not account for
the less proportion of the population now emp[loyed upon] the land,
because you always suppose more men to [be employed] but at less corn
wages. It can never happen, I think, that profits can fall and encourage
the cultivation of poor [land in] the manner assumed in my table without
a rise in the price of corn. It is by the rise of the price of corn that
all other profits are regulated to agricultural profits. If the price of
corn remained low, money wages would not rise, and general profits could
not fall. If it be true that capital has become more and more productive
on the land, it can, I think, only be accounted for on the supposition
that great improvements have taken place in agriculture, and that wages
have been kept moderate by the improvements in those manufactures which
supply the poor with the necessaries on which a part of their wages are
expended.
What a dreadful change in our political horizon has occurred within a
few days[96]! Will it be possible to remain at peace if Bonaparte
establishes himself as sovereign of France? The prospect is very gloomy.
... Ever yours,
DAVID RICARDO.