discovery of a measure of value: I challenge any man to show that the great interests of Political Economy have at all suffered for want of such a measure, which at best would end in answering a few questions of unprofitable curiosity: whilst, on the other hand, without a knowledge of the ground on which value depends, or without some approximation to it, Political Economy could not exist at all except as a heap of baseless opinions. Phad. Now then, having cleared away the imaginary uses of Mr. Ricardo's discovery, let us hear something of its real uses.

X. The most important of these I expressed in the last words I uttered: That, without which a science cannot exist, is commensurate in use with the science itself: being the fundamental law, it will testify its own importance in the changes which it will impress on all the derivative laws. For the main use of Mr. Ricardo's principle, I refer you therefore to all Political Economy. Meantime I will notice here the immediate services which it has rendered by liberating the student from those perplexities which generally embarrassed him on his first introduction to the science: I mention two cases by way of specimen.

1. When it was asked by the student-what determined the value of all commodities: it was answered that this value was chiefly determined by wages. When again it was asked -what determined wages? it was recollected that wages must obviously be adjusted to the value of the commodities upon which they were spent; and the answer was in effect that wages were determined by the value of commodities. And thus the mind was entangled in this inextricable circle that the price of commodities was determined by wages, and wages determined by the price of commodities. From this miserable Aanλog (as the logicians call it) we are now liberated: for the first step, as we are now aware, is false: the value of commodities is not determined by wages: for wages express the value of labor; and it has been demonstrated that the value of labor does not determine the value of its products.

2. A second case, in which Mr.

Ricardo's law has introduced a simplicity into the science which had in vain been sought for before, is this: all former economists, in laying down the component parts of price, had fancied it impossible to get rid of what is termed the raw material as one of its elements. This impossibility was generally taken for granted: but a celebrated economist of our times, the late Mr. Horner, had (in one of his papers published in the Edinburgh Review) expressly set himself to prove it." It is not true," said Mr. Horner, "that the thing purchased in every bargain is merely so much labor: the value of the raw material can neither be rejected as nothing, nor estimated as a constant quantity." Now this refractory element is at once and in the simplest way possible exterminated by Mr. Ricardo's law of value. For upon the old system, if I had resolved the value of my hat into wages and profits, I should immediately have been admonished that I had forgotten one of the elements: " wages, profits, and raw material, you mean"—it would have been said. Raw material! Well, but on what principle is this raw material itself to be valued? or on what other principle can it be valued than that on which the hat was valued before? Like any other product of labor, its value is determined by the quantity of labor employed in obtaining it: and the amount of this product, or its value in something else (i. e. in the product of some other equal labor) is divided between wages and profits as in any case of a manufactured commodity. The raw material of the hat is beaver: if in order to take the quantity of beavers which are necessary to furnish materials for a thousand hats, four men have been employed for 25 days— then it appears that the raw material of a thousand hats has cost 100 days' labor which will be of the same value in exchange as the product of 100 days' labor in any other direction: as, for example, if 100 days' labor would produce two thousand pair of stockings of a certain quality,-then it follows that the raw material of my hat is worth two pair of such stockings. And thus it turns out that an element of value, which Mr. Horner and thousands of others have sup

posed to be of a distinct nature and to resist all further analysis, gives way before Mr. Ricardo's law, and is exterminated: an admirable simplification, which is equal in merit and use to any of the rules which have been devised from time to time for the resolution of algebraic equations.

Phad. It is well you made this explanation for it has saved Mr. Ricardo from an objection which I had stored up against him. Amongst my goods and chattels I am seised or possessed of two pairs of silk stockings of which one cost double the price of the other. Now I happen to know that the labor of manufacturing the superior pair was not double in quan tity to the labor bestowed on the other, or as 6 to 3, but only as 6 to 4; the raw material of the superior pair having been in price to that of the inferior pair as 6 to 2. Upon your present explanation it appears that the labor previously employed in obtaining the raw material had been in the two cases as 6 to 2. Consequently the total labor spent on the superior pair was 12r; on the inferior 6 xi. e. as 2 to 1; and the diminished proportion of labor in the final stage of manufacturing was compensated by the higher proportion

in the previous stage of producing the raw material.

X. Doubtless. There are however more complex cases which cannot be resolved so easily without a knowledge of the laws of rent. And this would be anticipating that subject out of its proper place: on which account I will not here allege them. Here then I have given two specimens of the uses which arise from a better law of value; again reminding you however that the main use must lie in the effect which it will impress on all the other laws of Political Economy. And reverting for one moment, before we part, to the diffi culty of Philebus about the difference between this principle as a principium cognoscendi or measure and a principium essendi or ground,-let me desire you to consider these two essential marks of distinction-1. That all respectable economists have doubted or denied the existence of a true measure of value: but no man can doubt the existence of a ground of value. 2. That a measure is posterior to the value: for, before a value can be measured or estimated, it must exist: but a ground of value must be antecedent to the value, like any other cause to its effect.

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Illustrated. In this latter work, amongst other arguments, he has relied upon one in particular which he has chosen to exhibit in the form of a table. As it is of the last importance to Political Economy that this question should be settled, I will shrink from nothing that wears the semblance of an argument; and I will now examine this table: and will show that the whole of the inferences contained in the seventh, eighth, and ninth columns are founded on a gross blunder in the fifth and sixth: every number in which columns is falsely assigned.

Phad. Now X., you know that I abhor arithmetical calculations; besides which I have no faith in any propositions of a political economist, which he cannot make out readily without all this elaborate machinery of tables and figures. Under these circumstances I put it to you as a man of feeling, whether you ought to inflict upon me this alarming pile of computations; which, by your gloomy countenance, I see that you are meditating.

X. Surrender yourself to my guidance, Phædrus, and I will lead you over the hill by so easy a road that you shall never know you have been climbing.-You see that there are nine columns; that, I suppose, does not pass your skill in arithmetic. Now then to simplify the matter, begin by dismissing from your attention every column but the first and the last; fancy all the rest obliterated.

Phæd. Most willingly it is a heavenly fancy.

X. Now look into the first column, and tell me what you see there.

Phæd. I see "lots" of 150s and

140s and other ill-looking people of the same description.

X. Well, these numbers express the products of the same labor on land of different qualities. The quantity of labor is assumed to be always the same, viz. the labor of ten men for a year (or one man for ten years, or twenty men for half a year, &c.) The producing labor, I say, is always the same; but the product is constantly varying. Thus in the case Alpha the product is 150 quarters: in the cases Delta and Epsilon, when cultivation has been compelled by increasing population to descend upon inferior land, the product of equal labor is no more than 140 quarters; and in the case Iota it has fallen to 120 quarters. Now upon Mr. Ricardo's principle of valuation I demand to know what ought to be the price of these several products which vary so much in quantity?

Phad. Why, since they are all the products of the same quantity of labor, they ought all to sell for the same price.

X. Doubtless; not however of necessity for the same money price, since money may itself have varied, in which case the same money price would be really a very different price; but for the same price in all things which have not varied in value. The Xi product therefore which is only 90 quarters, will fetch the same real price as the Alpha or Gamma products which are 150.But, by the way in saying this, let me caution you against making the false inference-that corn is at the same price in the case Xi as in the case Alpha or Gamma: for the inference is the very opposite; since, if 90 quarters cost as much as 150, then each individual quarter of the 90 costs a great deal more. Thus suppose that the Alpha product sold at four pounds a quarter; the price of the whole would be 600l. Six hundred pounds therefore must be the price of Xi or the 90 quarters but that is 61. 138. 4d. a quarter. This ought to be a needless caution: yet I have known economists of great name stand much in need of it.

Phæd. I am sure I stand in need of it, and of all sort of assistance; for I am "ill at these numbers." But let us go on: what you require my assent to-I understand to be this: that all the different quantities of corn expressed in the first column will be of the same value, because they are all alike the product of ten men's labor. To this I do assent: and what next? Does any body deny it? X. Yes, Mr. Malthus: he asserts that the value will not be always the same and the purpose of the ninth column is to assign the true values; which, by looking into that column, you may perceive to be constantly varying the value of Alpha, for instance, is twelve and five-tenths; the value of Epsilon is twelve and seventenths; of Iota-twelve; and of Xieleven and twenty-five hundredths.

Phæd. But of what? Twelve and five-tenths of what?

X. Of any thing which, though variable, has in fact happened to be stationary in value: or, if you choose, of any thing which is not variable in value.

Phæd. Not variable! But there is no such thing.

X. No: Mr. Malthus however says there is: labor he asserts is of unalterable value. May, 1824.

Phad. What! does he mean to say then that the laborer always obtains the same wages?

X. Yes, the same real wages: all differences being only apparently in the wages, but really in the commodity in which the wages are paid. Let that commodity be wheat: then, if the laborer receives ten quarters of wheat in 1800-and nine in 1820, that would imply only that wheat was about 11 per cent. dearer in the latter year. Or let money be that commodity: then, if the laborer receives this century 2s. and next century 3s. this simply argues that money has fallen in value by 50 per cent.

the

Phad. Why so it may: and the whole difference in wages may have arisen in that way, and be only apparent. But then it may also have arisen from a change in the real value of wages-that is, on Ricardian principle, in the quantity of labor necessary to produce wages. And this latter must have been the nature of the change, if Alpha, Iota, Xi, &c. should be found to purchase more labor: in which case Mr. Ricardo's doctrine is not affected; for he will say that Iota in 1700 exchanges for 12 and Kappa in 1800 for 11, not because Kappa has fallen in that proportion (for Kappa, being the product of the same labor as Iota, cannot fall below the value of Iota), but because the commodity for which they are exchanged has risen in that proportion.

X. He will: but Mr. Malthus attempts to bar that answer in this case, by alleging that it is impossible for the commodity in question, viz. labor, to rise or to fall in that or in any other proportion. If then the change cannot be in the labor, it must be in Alpha, Beta, &c.; in which case Mr. Ricardo will be overthrown: for they are the products of the same quantity of labor,and yet have not retained the same value.

Phæd. But, to bar Mr. Ricardo's answer, Mr. Malthus must not allege this merely, he must prove it.

X. To be sure: and the first seven columns of this table are designed to prove it.-Now then we have done with the ninth column, and also with the eighth; for they are both mere corollaries from all the rest, and linked together under the rule of three.— Dismiss these altogether; and we will now come to the argument.

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The table is now reduced to seven columns, and the logic of it is this: the four first columns express the conditions, under which the three following ones are deduced as consequences: and they are to be read thus, taking the case Alpha by way of example:-Suppose that (by column one) the land cultivated is of such a quality that ten laborers produce me 150 quarters of corn; and that (by column two) each laborer receives for his own wages 12 quarters; in which case (by column three) the whole ten receive 120 quarters; and thus (by column four) leave me for my profit 30 quarters out of all that they have produced, i. e. 25 per cent.: Under these conditions, I insist (says Mr. Malthus) that the wages of ten men as stated in column three, let them be produced by little labor or much labor, shall never exceed or fall below one invariable value expressed in column seven: and accordingly by looking down that column you will perceive one uniform valuation of 10. Upon this statement it is manifest that the whole force of the logic turns upon the accuracy with which column three is valued in column seven. If that valuation be correct, then it follows that under all changes in the quantity of labor which produces them wages never alter in real value; in other words, the value of labor is invariable.

Phod. But of course you deny that the valuation is correct?

X. I do, Phædrus: the valuation is wrong, even on Mr. Malthus's or any other man's principles, in every instance: the value is not truly assigned in a single case of the whole fourteen. For how does Mr. Malthus obtain this invariable value of ten? He resolves the value of the wages expressed in column three into two parts; one of which, under the name “labor,” he assigns in column five; the other, under the name "profits," he assigns in column six: and column seven expresses the sum of these two parts; which are always kept equal to ten by always compensating each other's excesses and defects. Hapce, Phædrus, you see that-as column seven simply expresses the sum of column five and six-if those columns are right, cohumn seven cannot be wrong. Consequently it is in column five and six

that we are to look for the root of the error: which is indeed avery gross one. Phil. Why, now, for instance, take the case Alpha,-and what is the error you detect in that?

X. Simply this-that in column five, instead of 8, the true value is 6.4; and in column six, instead of 2, the true value is 1.6; the sum of which values is not ten but eight: and that is the figure which should have stood in column seven.

Phil. How so, X.? In column five Mr. Malthus undertakes to assign the quantity of labor necessary (under the conditions of the particular case) to produce the wages expressed in column three, which in this case Alpha are 120 quarters. Now you cannot deny that he has assigned it truly for when ten men produce 150 (by column one) i. e. each man fifteen, it must require eight to prcduce 120: for 120 is eight times fifteen. Six men and four tenths of a man, the number you would substitute, could produce only 96 quarters.

X. Very true, Philebus: eight men are necessary to produce the 120 quarters expressed in column three. And now answer me: what part of their own product will these eight producers deduct for their own wages?

Phil. Why (by column two) each man's wages in this case are twelve quarters: therefore the wages of the eight men will be 96 quarters.

X. And what quantity of labor will be necessary to produce these 96 quarters?

Phil. Each man producing fifteen, it will require six men's labor and four tenths of another man's labor.

X. Very well: 6.4 of the eight are employed in producing the wages of the whole eight. Now tell me, Philebus,-what more than their own wages do the whole eight produce?

Phil. Why as they produce in all 120 quarters, and their own deduction is 96, it is clear that they produce 24 quarters besides their own wages.

X. And to whom do these 24 quarters go?

Phil. To their employer for his profit.

X. Yes: and it answers the condition expressed in column four: for a profit of 24 quarters on 96 is exactly 25 per cent. But, to go on,-you have acknowledged that the 96 quarters for wages would be produced by