2。Ataxonanyonecommodity，whetherlaidonits
production，itsimportation，itscarriagefromplacetoplace，or
itssale，andwhetherthetaxbeafixedsumofmoneyforagiven
quantityofthecommodity，oranadvaloremduty，will，asa
generalrule，raisethevalueandpriceofthecommoditybyat
leasttheamountofthetax。Therearefewcasesinwhichitdoes
notraisethembymorethanthatamount。Inthefirstplace，
therearefewtaxesonproductiononaccountofwhichitisnot
foundordeemednecessarytoimposerestrictiveregulationson
themanufacturersordealers，inordertocheckevasionsofthe
tax。Theseregulationsarealwayssourcesoftroubleand
annoyance，andgenerallyofexpense，forallofwhich，being
peculiardisadvantages，theproducersordealersmusthave
compensationinthepriceoftheircommodity。Theserestrictions
alsofrequentlyinterferewiththeprocessesofmanufacture，
requiringtheproducertocarryonhisoperationsinthewaymost
convenienttotherevenue，thoughnotthecheapest，ormost
efficientforpurposesofproduction。Anyregulationswhatever，
enforcedbylaw，makeitdifficultfortheproducertoadoptnew
andimprovedprocesses。Further，thenecessityofadvancingthe
taxobligesproducersanddealerstocarryontheirbusinesswith
largercapitalsthanwouldotherwisebenecessary，onthewhole
ofwhichtheymustreceivetheordinaryrateofprofit，thougha
partonlyisemployedindefrayingtherealexpensesof
productionorimportation。Thepriceofthearticlemustbesuch
astoaffordaprofitonmorethanitsnaturalvalue，insteadof
aprofitononlyitsnaturalvalue。Apartofthecapitalofthe
country，inshort，isnotemployedinproduction，butinadvances
tothestate，repaidinthepriceofgoods;andtheconsumers
mustgiveanindemnitytothesellers，equaltotheprofitwhich
theycouldhavemadeonthesamecapitalifreallyemployedin
production。（1*）Neitheroughtittobeforgotten，thatwhatever
rendersalargercapitalnecessaryinanytradeorbusiness，
limitsthecompetitioninthatbusiness;andbygivingsomething
likeamonopolytoafewdealers，mayenablethemeithertokeep
upthepricebeyondwhatwouldaffordtheordinaryrateof
profit，ortoobtaintheordinaryrateofprofitwithaless
degreeofexertionforimprovingandcheapeningtheircommodity。
Intheseseveralmodes，taxesoncommoditiesoftencosttothe
consumer，throughtheincreasedpriceofthearticle，muchmore
thantheybringintothetreasuryofthestate。Thereisstill
anotherconsideration。Thehigherpricenecessitatedbythetax，
almostalwayschecksthedemandforthecommodity;andsince
therearemanyimprovementsinproductionwhich，tomakethem
practicable，requireacertainextentofdemand，such
improvementsareobstructed，andmanyofthemprevented
altogether。Itisawell。knownfactthatthebranchesof
productioninwhichfewestimprovementsaremade，arethosewith
whichtherevenueofficerinterferes;andthatnothing，in
general，givesagreaterimpulsetoimprovementsinthe
productionofacommodity，thantakingoffataxwhichnarrowed
themarketforit。
3。Sucharetheeffectsoftaxesoncommodities，considered
generally;。butastherearesomecommodities（thosecomposing
thenecessariesofthelabourer）ofwhichthevalueshavean
influenceonthedistributionofwealthamongdifferentclasses
ofthecommunity，itisrequisitetotracetheeffectsoftaxes
onthoseparticulararticlessomewhatfarther。Ifataxbelaid，
sayoncorn，andthepricerisesinproportiontothetax，the
riseofpricemayoperateintwoways。First:itmaylowerthe
conditionofthelabouringclasses;temporarilyindeeditcan
scarcelyfailtodoso。Ifitdiminishestheirconsumptionofthe
produceoftheearth，ormakesthemresorttoafoodwhichthe
soilproducesmoreabundantly，andthereforemorecheaply，itto
thatextentcontributestothrowbackagricultureuponmore
fertilelandsorlesscostlyprocesses，andtolowerthevalue
andpriceofcorn;whichthereforeultimatelysettlesataprice，
increasednotbythewholeamountofthetax，butbyonlyapart
ofitsamount。Secondly，however，itmayhappenthatthedearness
ofthetaxedfooddoesnotlowerthehabitualstandardofthe
labourer’srequirements，butthatwages，onthecontrary，through
anactiononpopulation，rise，inashorterorlongerperiod，so
astocompensatethelabourersfortheirportionofthetax;the
compensationbeingofcourseattheexpenseofprofits。Taxeson
necessariesmustthushaveoneoftwoeffects。Eithertheylower
theconditionofthelabouringclasses;ortheyexactfromthe
ownersofcapital，inadditiontotheamountduetothestateon
theirownnecessaries，theamountdueonthoseconsumedbythe
labourers。Inthelastcase，thetaxonnecessaries，likeatax
onwages，isequivalenttoapeculiartaxonprofits;whichis，
likeallotherpartialtaxation，unjust，andisspecially
prejudicialtotheincreaseofthenationalwealth。
Itremainstospeakoftheeffectonrent。Assuming（whatis
usuallythefact，）thattheconsumptionoffoodisnot
diminished，thesamecultivationasbeforewillbenecessaryto
supplythewantsofthecommunity;themarginofcultivation，to
useDrChalmers，expression，remainswhereitwas;andthesame
landorcapitalwhich，astheleastproductive，alreadyregulated
thevalueandpriceofthewholeproduce，willcontinueto
regulatethem。Theeffectwhichataxonagriculturalproduce
willhaveonrent，dependsonitsaffectingornotaffectingthe
differencebetweenthereturntothisleastproductivelandor
capital，andthereturnstootherlandsandcapitals。Nowthis
dependsonthemannerinwhichthetaxisimposed。Ifitisanad
valoremtax，orwhatisthesamething，afixedproportionofthe
produce，suchastitheforexample，itevidentlylowers
corn—rents。Forittakesmorecornfromthebetterlandsthan
fromtheworse;andexactlyinthedegreeinwhichtheyare
better;landoftwicetheproductivenesspayingtwiceasmuchto
thetithe。Whatevertakesmorefromthegreateroftwoquantities
thanfromtheless，diminishesthedifferencebetweenthem。The
impositionofatitheoncornwouldtakeatithealsofrom
corn—rent:forifwereduceaseriesofnumbersbyatentheach，
thedifferencesbetweenthemarereducedone—tenth。
Forexample，lettherebefivequalitiesofland，which
severallyyield，onthesameextentofground，andwiththesame
expenditure，100，90，80，70，and60bushelsofwheat;thelast
ofthesebeingthelowestqualitywhichthedemandforfood
rendersitnecessarytocultivate。Therentoftheselandswill
beasfollows:
Thelandproducing100bushelswillyieldarentof100—60or40
bushels。
Thatproducing90bushelswillyieldarentof90—60or30
bushels。
Thatproducing80bushelswillyieldarentof80—60or20
bushels。
Thatproducing70bushelswillyieldarentof70—60or10
bushels。
Thatproducing60bushelswillyieldarentofnorent。
Nowletatithebeimposed，whichtakesfromthesefivepiecesof
landlO，9，8，7，and6bushelsrespectively，thefifthquality
stillbeingtheonewhichregulatestheprice，butreturningto
thefarmer，afterpaymentoftithe，nomorethan54bushels:
Thelandproducing100bushelsreducedto90willyieldarentof
90—54or36bushels。
Thatproducing90bushelsreducedto81willyieldarentof
81—54or27bushels。
Thatproducing80bushelsreducedto72willyieldarentof
72—54or18bushels。
Thatproducing70bushelsreducedto63willyieldarentof
63—54or9bushels。
andthatproducing60bushels，reducedto54，willyield，as
before，norent。Sothattherentofthefirstqualityofland
haslostfourbushels;ofthesecond，three;ofthethird，two;
andofthefourth，one:thatis，eachhaslostexactlyone—tenth。
Atax，therefore，ofafixedproportionoftheproduce，lowers，
inthesameproportion，corn—rent。
Butitisonlycorn—rentthatislowered，andnotrent
estimatedinmoney，orinanyothercommodity。For，inthesame
proportionascorn—rentisreducedinquantity，thecorn
composingitisraisedinvalue。Underthetithe，54bushelswill
beworthinthemarketwhat60werebefore;andnine—tenthswill
inallcasessellforasmuchasthewholeten—tenthspreviously
soldfor。Thelandlordswillthereforebecompensatedinvalue
andpriceforwhattheyloseinquantity;andwillsufferonlyso
farastheyconsumetheirrentinkind，orafterreceivingitin
money，expenditinagriculturalproduce:thatis，theyonly
sufferasconsumersofagriculturalproduce，andincommonwith
alltheotherconsumers。Consideredaslandlords，theyhavethe
sameincomeasbefore;thetithe，therefore，fallsonthe
consumer，andnotonthelandlord。
Thesameeffectwouldbeproducedonrent，ifthetax，
insteadofbeingafixedproportionoftheproduce，wereafixed
sumperquarterorperbushel。Ataxwhichtakesashillingfor
everybushel，takesmoreshillingsfromonefieldthanfrom
another，justinproportionasitproducesmorebushels;and
operatesexactlyliketithe，expectthattitheisnotonlythe
sameproportiononalllands，butisalsothesameproportionat
alltimes，whileafixedsumofmoneyperbushelwillamounttoa
greateroralessproportion，accordingascornischeapordear。
Thereareothermodesoftaxingagriculture，whichwould
affectrentdifferently。Ataxproportionedtotherentwould
fallwhollyontherent，andwouldnotatallraisethepriceof
corn，whichisregulatedbytheportionoftheproducethatpays
norent。Afixedtaxofsomuchpercultivatedacre，without
distinctionofvalue，wouldhaveeffectsdirectlythereverse。
Takingnomorefromthebestqualitiesoflandthanfromthe
worst，itwouldleavethedifferencesthesameasbefore，and
consequentlythesamecorn—rents，andthelandlordswouldprofit
tothefullextentoftheriseofprice。Toputthethingin
anothermanner;thepricemustrisesufficientlytoenablethe
worstlandtopaythetax;thusenablingalllandswhichproduce
morethantheworst，topaynotonlythetax，butalsoan
increasedrenttothelandlords。These，however，arenotsomuch
taxesontheproduceofland，astaxesonthelanditself。Taxes
ontheproduce，properlysocalled，whetherfixedoradvalorem，
donotaffectrent，butfallontheconsumer:profits，however，
generallybearingeitherthewholeorthegreatestpartofthe
portionwhichisleviedontheconsumptionofthelabouring
classes。
4。Theprecedingis，Iapprehend，acorrectstatementofthe
mannerinwhichtaxesonagriculturalproduceoperatewhenfirst
laidon。When，however，theyareofoldstanding，theireffect
maybedifferent，aswasfirstpointedout，Ibelieve，byMr
Senior。Itis，aswehaveseen，analmostinfallibleconsequence
ofanyreductionofprofits，toretardtherateofaccumulation。
Nowtheeffectofaccumulation，whenattendedbyitsusual
accompaniment，anincreaseofpopulation，istoincreasethe
valueandpriceoffood，toraiserent，andtolowerprofits:
thatis，todopreciselywhatisdonebyataxonagricultural
produce，exceptthatthisdoesnotraiserent。Thetax，
therefore，merelyanticipatestheriseofprice，andfallof
profits，whichwouldhavetakenplaceultimatelythroughthemere
progressofaccumulation;whileitatthesametimeprevents，or
atleastretards，thatprogress。Iftherateofprofitwassuch，
previoustotheimpositionofatithe，thattheeffectofthe
tithereducesittothepracticalminimum，thetithewillputa
stoptoallfurtheraccumulation，orcauseittotakeplaceout
ofthecountry;andtheonlyeffectwhichthetithewillthen
havehadontheconsumer，istomakehimpayearliertheprice
whichhewouldhavehadtopaysomewhatlater—partofwhich，
indeed，inthegradualprogressofwealthandpopulation，he
wouldhavealmostimmediatelybeguntopay。Afteralapseoftime
whichwouldhaveadmittedofariseofone—tenththroughthe
naturalprogressofwealth，theconsumerwillbepayingnomore
thathewouldhavepaidifthetithehadneverexisted;hewill
haveceasedtopayanyportionofit，andthepersonwhowill
reallypayitisthelandlord，whomitdeprivesoftheincrease
ofrentwhichwouldbythattimehaveaccruedtohim。Atevery
successivepointinthisintervaloftime，lessoftheburthen
willrestontheconsumer，andmoreofitonthelandlord:andin
theultimateresult，theminimumofprofitswillbereachedwith
asmallercapitalandpopulation，andalowerrental，thanifthe
courseofthingshadnotbeendisturbedbytheimpositionofthe
tax。If，ontheotherhand，thetitheorothertaxon
agriculturalproducedoesnotreduceprofitstotheminimum，but
tosomethingabovetheminimum，accumulationwillnotbestopped，
butonlyslackened:andifpopulationalsoincreases，the
two—foldincreasewillcontinuetoproduceitseffects—arise
ofthepriceofcorn，andanincreaseofrent。These
consequences，however，willnottakeplacewiththesamerapidity
asifthehigherrateofprofithadcontinued。Attheendof
twentyyearsthecountrywillhaveasmallerpopulationand
capital，than，butforthetax，itwouldbythattimehavehad;
thelandlordswillhaveasmallerrent;andthepriceofcorn，
havingincreasedlessrapidlythanitwouldotherwisehavedone，
willnotbesomuchasatenthhigherthanwhat，iftherehad
beennotax，itwouldbythattimehavebecome。Apartofthe
tax，therefore，willalreadyhaveceasedtofallontheconsumer，
anddevolveduponthelandlord;andtheproportionwillbecome
greaterandgreaterbylapseoftime。
MrSeniorillustratesthisviewofthesubjectbylikening
theeffectsoftithes，orothertaxesonagriculturalproduceto
thoseofnaturalsterilityofsoil。Ifthelandofacountry
withoutaccesstoforeignsupplies，weresuddenlysmittenwitha
permanentdeteriorationofquality，toanextentwhichwouldmake
atenthmorelabournecessarytoraisetheexistingproduce，the
priceofcornwouldundoubtedlyriseone—tenth。Butitcannot
hencebeinferredthatifthesoilofthecountryhadfromthe
beginningbeenone—tenthworsethanitis，cornwouldatpresent
havebeenone—tenthdearerthanwefindit。Itisfarmore
probable，thatthesmallerreturntolabourandcapital，ever
sincethefirstsettlementofthecountry，wouldhavecausedin
eachsuccessivegenerationalessrapidincreasethanhastaken
place:thatthecountrywouldnowhavecontainedlesscapital，
andmaintainedasmallerpopulation，sothatnotwithstandingthe
inferiorityofthesoil，thepriceofcornwouldnothavebeen
higher，norprofitslower，thanatpresent;rentalonewould
certainlyhavebeenlower。Wemaysupposetwoislands，which，
beingalikeinextent，innaturalfertility，andindustrial
advancement，haveuptoacertaintimebeenequalinpopulation
andcapital，andhavehadequalrentals，andthesamepriceof
corn。Letusimagineatitheimposedinoneoftheseislands，but
notintheother。Therewillbeimmediatelyadifferenceinthe
priceofcorn，andthereforeprobablyinprofits。Whileprofits
arenottendingdownwardsineithercountry，thatis，while
improvementsintheproductionofnecessariesfullykeeppace
withtheincreaseofpopulation，thisdifferenceofpricesand
profitsbetweentheislandsmaycontinue。Butif，intheuntithed
island，capitalincreases，andpopulationalongwithit，more
thanenoughtocounterbalanceanyimprovementswhichtakeplace，
thepriceofcornwillgraduallyrise，profitswillfall，and
rentwillincrease;whileinthetithedislandcapitaland
populationwilleithernotincrease（beyondwhatisbalancedby
theimprovements），oriftheydo，willincreaseinalessdegree;
sothatrentandthepriceofcornwilleithernotriseatall，
orrisemoreslowly。Rent，therefore，willsoonbehigherinthe
untithedthaninthetithedisland，andprofitsnotsomuch
higher，norcornsomuchcheaper，astheywereonthefirst
impositionofthetithe。Theseeffectswillbeprogressive。At
theendofeverytenyearstherewillbeagreaterdifference
betweentherentalsandbetweentheaggregatewealthand
populationofthetwoislands，andalessdifferenceinprofits
andinthepriceofcorn。
Atwhatpointwilltheselastdifferencesentirelycease，and
thetemporaryeffectoftaxesonagriculturalproduce，inraising
theprice，haveentirelygivenplacetotheultimateeffect，that
oflimitingthetotalproduceofthecountry？Thoughtheuntithed
islandisalwaysvergingtowardsthepointatwhichthepriceof
foodwouldovertakethatinthetithedisland，itsprogress
towardsthatpointnaturallyslackensasitdrawsnearerto
attainingit;since—thedifferencebetweenthetwoislandsin
therapidityofaccumulationdependinguponthedifferenceinthe
ratesofprofit—inproportionastheseapproximate，the
movementwhichdrawsthemclosertogether，abatesofitsforce。
Theonemaynotactuallyovertaketheother，untilbothislands
reachtheminimumofprofits:uptothatpoint，thetithedisland
maycontinuemoreorlessaheadoftheuntithedislandinthe
priceofcorn:considerablyaheadifitisfarfromtheminimum，
andisthereforeaccumulatingrapidly。verylittleaheadifitis
neartheminimum，andaccumulatingslowly。
Butwhateveristrueofthetithedanduntithedislandsin
ourhypotheticalcase，istrueofanycountryhavingatithe，
comparedwiththesamecountryifithadneverhadatithe。
InEnglandthegreatemigrationofcapital，andthealmost
periodicaloccurrenceofcommercialcrisesthroughthe
speculationsoccasionedbythehabituallylowrateofprofit，are
indicationsthatprofithasattainedthepractical，thoughnot
theultimateminimum，andthatallthesavingswhichtakeplace
（beyondwhatimprovements，tendingtothecheapeningof
necessaries，makeroomfor）areeithersentabroadfor
investment，orperiodicallysweptaway。Therecantherefore，I
think，belittledoubtthatifEnglandhadneverhadatithe，or
anytaxonagriculturalproduce，thepriceofcornwouldhave
beenbythistimeashigh，andtherateofprofitsaslow，asat
present。Independentlyofthemorerapidaccumulationwhichwould
havetakenplaceifprofitshadnotbeenprematurelyloweredby
theseimposts;themeresavingofapartofthecapitalwhichhas
beenwastedinunsuccessfulspeculations，andthekeepingathome
apartofthatwhichhasbeensentabroad，wouldhavebeenquite
sufficienttoproducetheeffect。Ithink，therefore，withMr
Senior，thatthetithe，evenbeforeitscommutation，hadceased
tobeacauseofhighpricesorlowprofits，andhadbecomea
meredeductionfromrent;itsothereffectsbeing，thatitcaused
thecountrytohavenogreatercapital，nolargerproduction，and
nomorenumerouspopulationthanifithadbeenone—tenthless
fertilethanitis;orletusrathersayone。twentieth
（consideringhowgreataportionofthelandofGreatBritainwas
tithe—free）。
Butthoughtithesandothertaxesonagriculturalproduce，
whenoflongstanding，eitherdonotraisethepriceoffoodand
lowerprofitsatall，orifatall，notinproportiontothetax;
yettheabrogationofsuchtaxes，whentheyexist，doesnotthe
lessdiminishprice，and，ingeneral，raisetherateofprofit。
Theabolitionofatithetakesone—tenthfromthecostof
production，andconsequentlyfromtheprice，ofallagricultural
produce;andunlessitpermanentlyraisesthelabourer’s
requirements，itlowersthecostoflabour，andraisesprofits。
Rent，estimatedinmoneyorincommodities，generallyremainsas
before;estimatedinagriculturalproduce，itisraised。The
countryaddsasmuchbytherepealofatithe，tothemargin
whichintervenesbetweenitandthestationarystate，asiscut
offfromthatmarginbyatithewhenfirstimposed。Accumulation
isgreatlyaccelerated;andifpopulationalsoincreases，the
priceofcornimmediatelybeginstorecoveritself，andrentto
rise;thusgraduallytransferringthebenefitoftheremission，
fromtheconsumertothelandlord。
Theeffectswhichthusresultfromabolishingtithe，result
equallyfromwhathasbeendonebythearrangementsunderthe
CommutationActforconvertingitintoarent。charge。Whenthe
tax，insteadofbeingleviedonthewholeproduceofthesoil，is
leviedonlyfromtheportionswhichpayrent，anddoesnottouch
anyfreshextensionofcultivation，thetaxnolongerformsany
partofthecostofproductionoftheportionoftheproduce
whichregulatesthepriceofalltherest。Thelandorcapital
whichpaysnorent，cannowsenditsproducetomarketone—tenth
cheaper。Thecommutationoftitheoughtthereforetohave
producedaconsiderablefallintheaveragepriceofcorn。Ifit
hadnotcomesograduallyintooperation，andifthepriceof
cornhadnotduringthesameperiodbeenundertheinfluenceof
severalothercausesofchange，theeffectwouldprobablyhave
beenmarkedlyconspicuous。Asitis，therecanbenodoubtthat
thiscircumstancehashaditsshareinthefallwhichhastaken
placeinthecostofproductionandinthepriceofhome—grown
produce;thoughtheeffectsofthegreatagricultural
improvementswhichhavebeensimultaneouslyadvancing，andofthe
freeadmissionofagriculturalproducefromforeigncountries，
havemaskedthoseoftheothercause。Thisfallofpricewould
notinitselfhaveanytendencyinjurioustothelandlord，since
corn—rentsareincreasedinthesameratioinwhichthepriceof
cornisdiminished。Butneitherdoesitinanywaytendto
increasehisincome。Therent—charge，therefore，whichis
substitutedfortithe，isadeadlosstohimattheexpirationof
existingleases:andthecommutationoftithewasnotamere
alterationinthemodeinwhichthelandlordboreanexisting
burthen，buttheimpositionofanewone;reliefbeingafforded
totheconsumerattheexpenseofthelandlord，who，however，
beginsimmediatelytoreceiveprogressiveindemnificationatthe
consumer’sexpense，bytheimpulsegiventoaccumulationand
population。
5。Wehavehithertoinquiredintotheeffectsoftaxeson
commodities，ontheassumptionthattheyareleviedimpartially
oneverymodeinwhichthecommoditycanbeproducedorbrought
tomarket。Anotherclassofconsiderationsisopened，ifwe
supposethatthisimpartialityisnotmaintained，andthatthe
taxisimposed，notonthecommodity，butonsomeparticularmode
ofobtainingit。
Supposethatacommodityiscapableofbeingmadebytwo
differentprocesses;asamanufacturedcommoditymaybeproduced
eitherbyhandorbysteam—power;sugarmaybemadeeitherfrom
thesugar—caneorfrombeet—root，cattlefattenedeitheronhay
andgreencrops，oronoil—cakeandtherefuseofbreweries。It
istheinterestofthecommunity，thatofthetwomethods，
producersshouldadoptthatwhichproducesthebestarticleat
thelowestprice。Thisbeingalsotheinterestoftheproducers，
unlessprotectedagainstcompetition，andshieldedfromthe
penaltiesofindolence;theprocessmostadvantageoustothe
communityisthatwhich，ifnotinterferedwithbygovernment，
theyultimatelyfindittotheiradvantagetoadopt。Suppose
howeverthatataxislaidononeoftheprocesses，andnotaxat
all，oroneofsmalleramount，ontheother。Ifthetaxedprocess
istheonewhichtheproducerswouldnothaveadopted，the
measureissimplynugatory。Butifthetaxfalls，asitisof
courseintendedtodo，upontheonewhichtheywouldhave
adopted，itcreatesanartificialmotiveforpreferringthe
untaxedprocess，thoughtheinferiorofthetwo。If，therefore，
ithasanyeffectatall，itcausesthecommoditytobeproduced
ofworsequality，oratagreaterexpenseoflabour’。itcauses
somuchofthelabourofthecommunitytobewasted，andthe
capitalemployedinsupportingandremuneratingthelabourtobe
expendedasuselessly，asifitwerespentinhiringmentodig
holesandfillthemupagain。Thiswasteoflabourandcapital
constitutesanadditiontothecostofproductionofthe
commodity，whichraisesitsvalueandpriceinacorresponding
ratio，andthustheownersofthecapitalareindemnified。The
lossfallsontheconsumers;thoughthecapitalofthecountryis
alsoeventuallydiminished，bythediminutionoftheirmeansof
saving，andinsomedegree，oftheirinducementstosave。
Thekindoftax，therefore，whichcomesunderthegeneral
denominationofadiscriminatingduty，transgressestherulethat
taxesshouldtakeaslittleaspossiblefromthetax—payerbeyond
whattheybringintothetreasuryofthestate。Adiscriminating
dutymakestheconsumerpaytwodistincttaxes，onlyoneofwhich
ispaidtothegovernment，andthatfrequentlythelessonerous
ofthetwo。Ifataxwerelaidonsugarproducedfromthecane，
leavingthesugarfrombeet—rootuntaxed，theninsofarascane
sugarcontinuedtobeused，thetaxonitwouldbepaidtothe
treasury，andmightbeasobjectionableasmostothertaxes;but
ifcanesugar，havingpreviouslybeencheaperthanbeet—root
sugar，wasnowdearer，andbeet—rootsugarwastoany
considerableamountsubstitutedforit，andfieldslaidoutand
manufactoriesestablishedinconsequence，thegovernmentwould
gainnorevenuefromthebeet—rootsugar，whiletheconsumersof
itwouldpayarealtax。Theywouldpayforbeet—rootsugarmore
thantheyhadpreviouslypaidforcanesugar，andthedifference
wouldgotoindemnifyproducersforaportionofthelabourof
thecountryactuallythrownaway，inproducingbythelabourof
（say）threehundredmen，whatcouldbeobtainedbytheother
processwiththelabouroftwohundred。
Oneofthecommonestcasesofdiscriminatingduties，isthat
ofataxontheimportationofacommoditycapableofbeing
producedathome，unaccompaniedbyanequivalenttaxonthehome
production。Acommodityisneverpermanentlyimported，unlessit
canbeobtainedfromabroadatasmallercostoflabourand
capitalonthewhole，thanisnecessaryforproducingit。If，
therefore，byadutyontheimportation，itisrenderedcheaper
toproducethearticlethantoimportit，anextraquantityof
labourandcapitalisexpended，withoutanyextraresult。The
labourisuseless，andthecapitalisspentinpayingpeoplefor
laboriouslydoingnothing。Allcustomdutieswhichoperateasan
encouragementtothehomeproductionofthetaxedarticle，are
thusaneminentlywastefulmodeofraisingarevenue。
Thischaracterbelongsinapeculiardegreetocustomduties
ontheproduceofland，unlesscountervailedbyexcisedutieson
thehomeproduction。Suchtaxesbringlessintothepublic
treasury，comparedwithwhattheytakefromtheconsumers，than
anyotherimpoststowhichcivilizednationsareusuallysubject。
Ifthewheatproducedinacountryistwentymillionsof
quarters，andtheconsumptiontwenty—onemillions，amillion
beingannuallyimported，andifonthismillionadutyislaid
whichraisesthepricetenshillingsperquarter，thepricewhich
israisedisnotthatofthemilliononly，butofthewhole
twenty—onemillions。Takingthemostfavourable，butextremely
improbablesupposition，thattheimportationisnotatall
checked，northehomeproductionenlarged，thestategainsa
revenueofonlyhalfamillion，whiletheconsumersaretaxedten
millionsandahalf;thetenmillionsbeingacontributiontothe
homegrowers，whoareforcedbycompetitiontoresignitallto
thelandlords。Theconsumerthuspaystotheownersoflandan
additionaltax，equaltotwentytimesthatwhichhepaystothe
state。Letusnowsupposethatthetaxreallychecksimportation。
Supposeimportationstoppedaltogetherinordinaryyears;it
beingfoundthatthemillionofquarterscanbeobtained，bya
moreelaboratecultivation，orbybreakingupinferiorland，ata
lessadvancethantenshillingsuponthepreviousprice——say，
forinstance，fiveshillingsaquarter。Therevenuenowobtains
nothing，exceptfromtheextraordinaryimportswhichmayhappen
totakeplaceinaseasonofscarcity。Buttheconsumerspay
everyyearataxoffiveshillingsonthewholetwenty—one
millionsofquarters，amountingto51/4millionssterling。Of
thistheodd250，000l。goestocompensatethegrowersofthe
lastmillionofquartersforthelabourandcapitalwastedunder
thecompulsionofthelaw。Theremainingfivemillionsgoto
enrichthelandlordsasbefore。
SuchistheoperationofwhataretechnicallytermedCorn
Laws，whenfirstlaidon;andsuchcontinuestobetheir
operation，solongastheyhaveanyeffectatallinraisingthe
priceofcorn。ButIambynomeansofopinionthatinthelong
runtheykeepupeitherpricesorrentsinthedegreewhichthese
considerationsmightleadustosuppose。Whatwehavesaid
respectingtheeffectoftithesandothertaxesonagricultural
produce，appliesinagreatdegreetocornlaws:theyanticipate
artificiallyariseofpriceandofrent，whichwouldatall
eventshavetakenplacethroughtheincreaseofpopulationandof
production。Thedifferencebetweenacountrywithoutcornlaws，
andacountrywhichhaslonghadcornlaws，isnotsomuchthat
thelasthasahigherpriceoralargerrental，butthatithas
thesamepriceandthesamerentalwithasmalleraggregate
capitalandasmallerpopulation。Theimpositionofcornlaws
raisesrents，butretardsthatprogressofaccumulationwhich
wouldinnolongperiodhaveraisedthemfullyasmuch。The
repealofcornlawstendstolowerrents，butitunchainsaforce
which，inaprogressivestateofcapitalandpopulation，restores
andevenincreasestheformeramount。Thereiseveryreasonto
expectthatunderthevirtuallyfreeimportationofagricultural
produce，atlastextortedfromtherulingpowersofthiscountry，
thepriceoffood，ifpopulationgoesonincreasing，will
graduallybutsteadilyrise;thoughthiseffectmayforatimebe
postponedbythestrongcurrentwhichinthiscountryhassetin
（andtheimpulseisextendingitselftoothercountries）towards
theimprovementofagriculturalscience，anditsincreased
applicationtopractice。
Whatwehavesaidofdutiesonimportationgenerally，is
equallyapplicabletodiscriminatingdutieswhichfavour
importationfromoneplaceorinoneparticularmanner，in
contradistinctiontoothers:suchasthepreferencegiventothe
produceofacolony，orofacountrywithwhichthereisa
commercialtreaty:orthehigherdutiesformerlyimposedbyour
navigationlawsongoodsimportedinotherthanBritishshipping。
Whateverelsemaybeallegedinfavourofsuchdistinctions，
whenevertheyarenotnugatory，theyareeconomicallywasteful。
Theyinducearesorttoamorecostlymodeofobtaininga
commodity，inlieuofonelesscostly，andthuscauseaportion
ofthelabourwhichthecountryemploysinprovidingitselfwith
foreigncommodities，tobesacrificedwithoutreturn。
6。Thereisonemorepointrelatingtotheoperationoftaxes
oncommoditiesconveyedfromonecountrytoanother，which
requiresnotice:theinfluencewhichtheyexertoninternational
exchanges。Everytaxonacommoditytendstoraiseitsprice，and
consequentlytolessenthedemandforitinthemarketinwhich
itissold。Alltaxesoninternationaltradetend，therefore，to
produceadisturbanceandareadjustmentofwhatwehavetermed
theEquationofInternationalDemand。Thisconsiderationleadsto
somerathercuriousconsequences，whichhavebeenpointedoutin
theseparateessayoninternationalCommerce，alreadyseveral
timesreferredtointhistreatise。
Taxesonforeigntradeareoftwokinds—taxesonimports，
andonexports。Onthefirstaspectofthematteritwouldseem
thatboththesetaxesarepaidbytheconsumersofthecommodity;
thattaxesonexportsconsequentlyfallentirelyonforeigners，
taxesonimportswhollyonthehomeconsumer。Thetruestateof
thecase，however，ismuchmorecomplicated。
’Bytaxingexports，wemay，incertaincircumstances，produce
adivisionoftheadvantageofthetrademorefavourableto
ourselves。Insomecaseswemaydrawintoourcoffers，atthe
expenseofforeigners，notonlythewholetax，butmorethanthe
tax:inothercases，weshouldgainexactlythetax;inothers，
lessthanthetax。Inthislastcase，apartofthetaxisborne
byourselves:possiblythewhole，possiblyeven，asweshall
show，morethanthewhole。’Revertingtothesupposititiouscase
employedintheEssay，ofatradebetweenGermanyandEnglandin
broadclothandlinen，’supposethatEnglandtaxesherexportof
cloth，thetaxnotbeingsupposedhighenoughtoinduceGermany
toproduceclothforherself。Thepriceatwhichclothcanbe
soldinGermanyisaugmentedbythetax。Thiswillprobably
diminishthequantityconsumed。Itmaydiminishitsomuchthat，
evenattheincreasedprice，therewillnotberequiredsogreat
amoneyvalueasbefore。Oritmaynotdiminishitatall，orso
little，thatinconsequenceofthehigherprice，agreatermoney
valuewillbepurchasedthanbefore。Inthislastcase，England
willgain，attheexpenseofGermany，notonlythewholeamount
oftheduty，butmore;for，themoneyvalueofherexportsto
Germanybeingincreased，whileherimportsremainthesame，money
willflowintoEnglandfromGermany。Thepriceofclothwillrise
inEngland，andconsequentlyinGermany;butthepriceoflinen
willfallinGermany，andconsequentlyinEngland。Weshall
exportlesscloth，andimportmorelinen，tilltheequilibriumis
restored。Itthusappears（whatisatfirstsightsomewhat
remarkable）thatbytaxingherexports，Englandwould，insome
conceivablecircumstances，notonlygainfromherforeign
customersthewholeamountofthetax，butwouldalsogether
importscheaper。Shewouldgetthemcheaperintwoways;forshe
wouldobtainthemforlessmoney，andwouldhavemoremoneyto
purchasethemwith。Germany，ontheotherhand，wouldsuffer
doubly:shewouldhavetopayforherclothapriceincreasednot
onlybytheduty，butbytheinfluxofmoneyintoEngland，while
thesamechangeinthedistributionofthecirculatingmedium
wouldleaveherlessmoneytopurchaseitwith。
’This，however，isonlyoneofthreepossiblecases。If，
aftertheimpositionoftheduty，Germanyrequiressodiminished
aquantityofcloth，thatitstotalvalueisexactlythesameas
before，thebalanceoftradewouldbeundisturbed;Englandwill
gaintheduty，Germanywillloseit，andnothingmore。If，again，
theimpositionofthedutyoccasionssuchafallingoffinthe
demandthatGermanyrequiresalesspecuniaryvaluethanbefore，
ourexportswillnolongerpayforourimports;moneymustpass
fromEnglandintoGermany;andGermany’sshareoftheadvantage
ofthetradewillbeincreased。Bythechangeinthedistribution
ofmoney，clothwillfallinEngland;andthereforeitwill，of
course，fallinGermany—ThusGermanywillnotpaythewholeof
thetax。Fromthesamecause，linenwillriseinGermany，and
consequentlyinEngland。Whenthisalterationofpriceshasso
adjustedthedemand，thattheclothandthelinenagainpayfor
oneanother，theresultisthatGermanyhaspaidonlyapartof
thetax，andtheremainderofwhathasbeenreceivedintoour
treasuryhascomeindirectlyoutofthepocketsofourown
consumersoflinen，whopayahigherpriceforthatimported
commodityinconsequenceofthetaxonourexports，whileatthe
sametimethey，inconsequenceoftheeffluxofmoneyandthe
fallofprices，havesmallermoneyincomeswherewithtopayfor
thelinenatthatadvancedprice。
’Itisnotanimpossiblesuppositionthatbytaxingour
exportswemightnotonlygainnothingfromtheforeigner，the
taxbeingpaidoutofourownpockets，butmightevencompelour
ownpeopletopayasecondtaxtotheforeigner。Suppose，as
before，thatthedemandofGermanyforclothfallsoffsomuchon
theimpositionoftheduty，thatsherequiresasmallermoney
valuethanbefore，butthatthecaseissodifferentwithlinen
inEngland，thatwhenthepricerisesthedemandeitherdoesnot
falloffatall，orsolittlethatthemoneyvaluerequiredis
greaterthanbefore。Thefirsteffectoflayingonthedutyis，
asbefore，thattheclothexportedwillnolongerpayforthe
linenimported。MoneywillthereforeflowoutofEnglandinto
Germany。OneeffectistoraisethepriceoflineninGermany，
andconsequentlyinEngland。Butthis，bythesupposition，
insteadofstoppingtheeffluxofmoney，onlymakesitgreater，
becausethehighertheprice，thegreaterthemoneyvalueofthe
linenconsumed。Thebalance，therefore，canonlyberestoredby
theothereffect，whichisgoingonatthesametime，namely，the
fallofclothintheEnglishandconsequentlyintheGerman
market。Evenwhenclothhasfallensolowthatitspricewiththe
dutyisonlyequaltowhatitspricewithoutthedutywasat
first，itisnotanecessaryconsequencethatthefallwillstop;
forthesameamountofexportationasbeforewillnotnowsuffice
topaytheincreasedmoneyvalueoftheimports;andalthoughthe
Germanconsumershavenownotonlyclothattheoldprice，but
likewiseincreasedmoneyincomes，itisnotcertainthatthey
willbeinclinedtoemploytheincreaseoftheirincomesin
increasingtheirpurchasesofcloth。Thepriceofcloth，
therefore，mustperhapsfall，torestoretheequilibrium，more
thanthewholeamountoftheduty;Germanymaybeenabledto
importclothatalowerpricewhenitistaxed，thanwhenitwas
untaxed:andthisgainshewillacquireattheexpenseofthe
Englishconsumersoflinen，who，inaddition，willbethereal
payersofthewholeofwhatisreceivedattheirowncustom—house
underthenameofdutiesontheexportofcloth。’
Itisalmostunnecessarytoremarkthatclothandlinenare
heremerelyrepresentativesofexportsandimportsingeneral;
andthattheeffectwhichataxonexportsmighthavein
increasingthecostsofimports，wouldaffecttheimportsfrom
allcountries，andnotpeculiarlythearticleswhichmightbe
importedfromtheparticularcountrytowhichthetaxedexports
weresent。
’Sucharetheextremelyvariouseffectswhichmayresultto
ourselvesandtoourcustomersfromtheimpositionoftaxeson
ourexports;andthedeterminingcircumstancesareofanatureso
imperfectlyascertainable，thatitmustbealmostimpossibleto
decidewithanycertainty，evenafterthetaxhasbeenimposed，
whetherwehavebeengainersbyitorlosers。’Ingeneralhowever
therecouldbelittledoubtthatacountrywhichimposedsuch
taxeswouldsucceedinmakingforeigncountriescontribute
somethingtoitsrevenue;butunlessthetaxedarticlebeonefor
whichtheirdemandisextremelyurgent，theywillseldompaythe
wholeoftheamountwhichthetaxbringsin。（2*）’Inanycase，
whateverwegainislostbysomebodyelse，andthereisthe
expenseofthecollectionbesides:ifinternationalmorality，
therefore，wererightlyunderstoodandactedupon，suchtaxes，as
beingcontrarytotheuniversalweal，wouldnotexist。’
Thusfarofdutiesonexports。Wenowproceedtothemore
ordinarycaseofdutiesonimports。’Wehavehadanexampleofa
taxonexports，thatis，onforeigners，fallinginparton
ourselves。Weshallthereforenotbesurprisedifwefindatax
onimports，thatis，onourselves，partlyfallingupon
foreigners。
’Insteadoftaxingtheclothwhichweexport，supposethatwe
taxthelinenwhichweimport。Thedutywhichwearenow
supposingmustnotbewhatistermedaprotectingduty，thatis，
adutysufficientlyhightoinduceustoproducethearticleat
home。Ifithadthiseffect，itwoulddestroyentirelythetrade
bothinclothandinlinen，andbothcountrieswouldlosethe
wholeoftheadvantagewhichtheypreviouslygainedbyexchanging
thosecommoditieswithoneanother。Wesupposeadutywhichmight
diminishtheconsumptionofthearticle，butwhichwouldnot
preventusfromcontinuingtoimport，asbefore，whateverlinen
wedidconsume。
’Theequilibriumoftradewouldbedisturbedifthe
impositionofthetaxdiminished，intheslightestdegree，the
quantityoflinenconsumed。For，asthetaxisleviedatourown
custom—house，theGermanexporteronlyreceivesthesamepriceas
formerly，thoughtheEnglishconsumerpaysahigherone。If，
therefore，therebeanydiminutionofthequantitybought，
althoughalargersumofmoneymaybeactuallylaidoutinthe
article，asmalleronewillbeduefromEnglandtoGermany:this
sumwillnolongerbeanequivalentforthesumduefromGermany
toEnglandforcloth，thebalancethereforemustbepaidin
money。PriceswillfallinGermanyandriseinEngland;linen
willfallintheGermanmarket;clothwillriseintheEnglish。
TheGermanswillpayahigherpriceforcloth，andwillhave
smallermoneyincomestobuyitwith;whiletheEnglishwill
obtainlinencheaper，thatis，itspricewillexceedwhatit
previouslywasbylessthantheamountoftheduty，whiletheir
meansofpurchasingitwillbeincreasedbytheincreaseoftheir
moneyincomes。
’Iftheimpositionofthetaxdoesnotdiminishthedemand，
itwillleavethetradeexactlyasitwasbefore。Weshallimport
asmuch，andexportasmuch;thewholeofthetaxwillbepaid
outofourownpockets。
’Buttheimpositionofataxonacommodityalmostalways
diminishesthedemandmoreorless;anditcannever，orscarcely
ever，increasethedemand。Itmay，therefore，belaiddownasa
principle，thatataxonimportedcommodities，whenitreally
operatesasatax，andnotasaprohibitioneithertotalor
partial，almostalwaysfallsinpartupontheforeignerswho
consumeourgoods;andthatthisisamodeinwhichanationmay
appropriatetoitself，attheexpenseofforeigners，alarger
sharethanwouldotherwisebelongtoitoftheincreaseinthe
generalproductivenessofthelabourandcapitaloftheworld，
whichresultsfromtheinterchangeofcommoditiesamongnations。’
Thoseare，therefore，intherightwhomaintainthattaxeson
importsarepartlypaidbyforeigners;buttheyaremistakenwhen
theysay，thatisisbytheforeignproducer。Itisnotonthe
personfromwhomwebuy，butonallthosewhobuyfromus，thata
portionofourcustom—dutiesspontaneouslyfalls。Itisthe
foreignconsumerofourexportedcommodities，whoisobligedto
payahigherpriceforthembecausewemaintainrevenuedutieson
foreigngoods。
Therearebuttwocasesinwhichdutiesoncommoditiescanin
anydegree，orinanymanner，fallontheproducer。Oneis，when
thearticleisastrictmonopoly，andatascarcityprice。The
priceinthiscasebeingonlylimitedbythedesiresofthe
buyer;thesumobtainedfromtherestrictedsupplybeingthe
utmostwhichthebuyerswouldconsenttogiveratherthango
withoutit;ifthetreasuryinterceptsapartofthis，theprice
cannotbefurtherraisedtocompensateforthetax，anditmust
bepaidfromthemonopolyprofits。Ataxonrareandhigh—priced
wineswillfallwhollyonthegrowers，orrather，ontheowners
ofthevineyards。Thesecondcaseinwhichtheproducersometimes
bearsaportionofthetax，ismoreimportant:thecaseofduties
ontheproduceoflandorofmines。Thesemightbesohighasto
diminishmateriallythedemandfortheproduce，andcompelthe
abandonmentofsomeoftheinferiorqualitiesoflandormines。
Supposingthistobetheeffect，theconsumers，bothinthe
countryitselfandinthosewhichdealtwithit，wouldobtainthe
produceatsmallercost;andapartonly，insteadofthewhole，
ofthedutywouldfallonthepurchaser，whowouldbeindemnified
chieflyattheexpenseofthelandownersormine—ownersinthe
producingcountry。
Dutiesonimportationmay，then，bedivided’intotwo
classes:thosewhichhavetheeffectofencouragingsome
particularbranchofdomesticindustry，andthosewhichhavenot。
Theformerarepurelymischievous，bothtothecountryimposing
them，andtothosewithwhomittrades。Theypreventasavingof
labourandcapital，which，ifpermittedtobemade，wouldbe
dividedinsomeproportionorotherbetweentheimportingcountry
andthecountrieswhichbuywhatthatcountrydoesormight
export。
’Theotherclassofdutiesarethosewhichdonotencourage
onemodeofprocuringanarticleattheexpenseofanother，but
allowinterchangetotakeplacejustasifthedutydidnot
exist，andtoproducethesavingoflabourwhichconstitutesthe
motivetointernational，astoallothercommerce。Ofthiskind
aredutiesontheimportationofanycommoditywhichcouldnotby
anypossibilitybeproducedathome;anddutiesnotsufficiently
hightocounterbalancethedifferenceofexpensebetweenthe
productionofthearticleathomeanditsimportation。Ofthe
moneywhichisbroughtintothetreasuryofanycountrybytaxes
ofthislastdescription，apartonlyispaidbythepeopleof
thatcountry;theremainderbytheforeignconsumersoftheir
goods。