date

24 Aug. 1801 C2 Polit. Economy
24 Aug. 1801

C2

Polit. Economy

Method

III Non Agenda.

Encouragement

71

6

10

productive, individuals that have unengaged pecuniary capital to employ are

already as compleatly disposed to engage /employ/ it in this most profitable

branch as any thing that can be done /be employ'd/ by government can make

them.b. (a) {Encouragement afforded by government to this or that particular

branch is therefore either useless or mischievous or useless: useless if it be

more productive than any other, mischievous, if it be not. /in the opposite

case./

Inclination, power, knowledge: inclination to apply himself to the most

profitable of all branches is what the individual never can be in want of: power

depends principally /generally/ upon money, which can not be given to one

individual without being taken from others : knowledge as to what branch of

industry would be most profitable to him is what in general each individual is

apt to be possessed of in a greater degree than government: though if government

through the industry or /and/ sagacity of any of its agents happens in this or

that particular case to have more knowledge about the matter than the

individuals who have the choice to make, there can be no harm in the

communication /diffusion/ of it at the expense of government, because by even

the mere advance of a minute /an impalpable/ portion of money well applied, an

infinite stock /an infinity/ of useful knowledge may be diffused.}

[(a)] See Note next page
Similar Items
  • Title: [24 Aug. 1801 C2 Polit. Economy]
    Description: 24 Aug. 1801

    C2

    Polit. Economy

    Method

    III Non Agenda.

    Encouragement

    72

    7

    11

    Note to last page

    It may however happen in some instances that a branch of industry which if

    pursued would be more profitable than any other requires a mass of capital of

    such magnitude, as individuals separately taken or in small numbers are not able

    to raise. But where this happens it can only be in consequence of some positive

    regulation of government, which in contemplation of the mischief apprehended

    from over grown masses of capital in certain cases forbids limits or endeavours

    /seeks/ to limit the quantity of capital that shall be applied under one

    management to any branch of industry, by limiting the number of individuals who

    shall be allowed to contribute to it, or by not suffering a man to embark in

    trade any part of his property without embarking the whole. In giving an

    encouragement of this sort /in this shape/, government does little or nothing

    more than remove discouragements /obstacles/ of its own creating, and the good

    it does if any is done at no expence.

    When by the assistance /exertions of/ government a mass of capital which

    otherwise would have gone into a branch of productive industry producing but 15

    per Cent is directed into a branch producing 16 per Cent, the profit by those

    exertions is not the 16 per Cent, but the difference between that and the 15 per

    Cent, viz: the one per cent. It is for the 16 per cent however and not the one

    percent that credit is commonly taken by those statesmen who go to market for

    glory with the merit of affording encouragement to trade: and if 10
  • Title: [24 Aug. 1801 C2 Polit. Economy]
    Description: 24 Aug. 1801

    C2

    Polit. Economy

    Method

    III Non Agenda

    Encouragement

    74

    9

    13

    Divide productive industry into any number of branches, for instance four as

    with A. /Adam/ Smith: husbandry including mines and fishing, manufacture for

    home consumption - manufacture for foreign consumption, and carrying trade Every

    encouragement afforded to any one of the four branches is pro tanto /operates to

    the amount in/ discouragement of all the others. If however the encouragement

    were /be/ given in the shape of capital granted or lent, it will make an

    addition say ,100,000 to the amount of it to the aggregate of real capital, and

    thence to the amount of a percentage upon that capital to the annual aggregate

    of growing wealth. But the addition thus made to wealth will depend for its

    magnitude not on the choice made of the branch of industry, unless as to an

    extremely minute part of it, but on the addition made to capital /the productive

    capital of the community/ at the expence of its income. A mode that would bid as

    fair for disposing of the money to the best advantage would be to let a certain

    number of commercial men draw lots for the money with liberty to apply it each

    in his own way. But what again would contribute in an equal way /degree/ to the

    same end is, if the Nation has a debt, to employ the same sum in the buying in

    or paying off a portion of the debt, for in that case the receivers of the money

    in lieu of Annuities would employ each of them his money in some branch of

    industry in his own way of course under his mere[?] management or that of

    somebody to whom he lends the money. The first course requires /is attended

    with/ expence,
  • Title: [24 Aug. 1801 {C2} Section 9.]
    Description: 24 Aug. 1801

    {C2} Section 9.

    Polit. Economy

    Method D

    Non Agenda.

    II Narrow Measures

    4 Particulars

    v. Encouragement

    70

    5

    {2.} 5. Giving birth or encrease to this or that particular branch of {wealth

    or} productive industry {industry /labour/ productive of wealth} under the

    notion of giving an encrease thereby to the aggregate of the national mass of

    wealth.

    The aggregate mass of money employ'd in the shape of productive capital will in

    all branches of industry taken together be productive of /were[?]/ so much per

    Cent upon the amount of it say 15 per Cent, or more or less, according to the

    average rate of profit upon stock in the country in question, which is in[?] the

    inverse ratio of that portion of the mass of money in circulation, which is

    employ'd within the year in the shape of productive capital to that portion of

    it which is employ'd as money is employ'd by a man who is said to spend his

    income, {Note. each being multiplied by the number of times it has been employ'd

    within the year in making purchases constitutive of ultimate prices. /the

    purchases of which ultimate prices are composed./

    If in one of those branches the rate of profit is greater than in others in the

    one 16 for example in the others but 15, the greater the portion of capital

    employ'd in this most productive branch in preference to others less productive,

    the greater the annual addition to the aggregate mass of natural wealth. But, so

    long as they do but know which of all the branches open to them is most