Thecoal，therefore，hasvalue，mustbepaidforbyanequivalent，andhasacost。Thewaterfallisanaturalproductionagentintheproductionofwhichnolabourenters。
Butthisisnotall。Themanufacturerwhooperateswithsteamalsoemploysnaturalforceswhichcosthimnothingyetmakethelabourmoreproductiveandincreasethesurplus-valueandtherebytheprofit，inasmuchastheythuscheapenthemanufactureofthemeansofsubsistencerequiredforthelabourers。Thesenaturalforcesarethusquiteasmuchmonopolisedbycapitalasthesocialnaturalforcesoflabourarisingfromco-operation，divisionoflabour，etc。Themanufacturerpaysforcoal，butnotforthecapacityofwatertoalteritsphysicalstate，toturnintosteam，notfortheelasticityofthesteam，etc。Thismonopolisationofnaturalforces，thatis，oftheincreaseinlabour-powerproducedbythem，iscommontoallcapitaloperatingwithsteam-engines。Itmayincreasethatportionoftheproductoflabourwhichrepresentssurplus-valueinrelationtothatportionwhichistransformedintowages。Insofarasitdoesthis，itraisesthegeneralrateofprofit，butitdoesnotcreateanysurplus-profit，forthisconsistsoftheexcessofindividualprofitoveraverageprofit。Thefactthattheapplicationofanaturalforce，awaterfall，createssurplus-profitinthiscase，cannotthereforebeduesolelytothecircumstancethattheincreasedproductivityoflabourhereresultsfromtheapplicationofanaturalforce。Othermodifyingcircumstancesarenecessary。
Conversely。Themereapplicationofnaturalforcesinindustrymayinfluencethelevelofthegeneralrateofprofitbecauseitaffectsthequantityoflabourrequiredtoproducethenecessarymeansofsubsistence。
Butinitselfitdoesnotcreateanydeviationfromthegeneralrateofprofit，andthisispreciselythepointinwhichweareinterestedhere。
Furthermore，thesurplus-profitwhichsomeindividualcapitalotherwiserealisesinaparticularsphereofproduction-fordeviationsoftheratesofprofitinvariousspheresofproductionarecontinuallybalancedoutintoanaveragerate-isdue，asidefromfortuitousdeviations，toareductionincost-price，inproductioncosts。Thisreductionariseseitherfromthefactthatcapitalisusedingreaterthanaveragequantities，sothatfauxfraisofproductionarereduced，whilethegeneralcausesincreasingtheproductivenessoflabourcooperation，divisionoflabour，etc。canbecomeeffectivetoahigherdegree，withmoreintensity，becausetheirfieldofactivityhasbecomelarger；oritmayarisefromthefactthat，asidefromtheamountoffunctioningcapital，bettermethodsoflabour，newinventions，improvedmachinery，chemicalmanufacturingsecrets，etc。，inshort，newandimproved，betterthanaveragemeansofproductionandmethodsofproductionareused。Thereductionincost-priceandthesurplus-profitarisingfromitareheretheresultofthemannerinwhichthefunctioningcapitalisinvested。Theyresulteitherfromthefactthatthecapitalisconcentratedinthehandsofonepersoninextraordinarilylargequantitiesaconditionthatiscancelledoutassoonasequalmagnitudesofcapitalareusedontheaverage，orfromthefactthatacertainmagnitudeofcapitalfunctionsinaparticularlyproductivemanneraconditionthatdisappearsassoonastheexceptionalmethodofproductionbecomesgeneralorissurpassedbyastillmoredevelopedone。
Thecauseofthesurplus-profit，then，arisesherefromthecapitalitselfwhichincludesthelaboursetinmotionbyitwhetheritbeduetothegreatermagnitudeofcapitalemployedortoitsmoreefficientapplication；
and，asamatteroffact，thereisnoparticularreasonwhyallcapitalinthesameproductionsphereshouldnotbeinvestedinthesamemanner。
Onthecontrary，thecompetitionbetweencapitalstendstocancelthesedifferencesmoreandmore。Thedeterminationofvaluebythesociallynecessarylabour-timeassertsitselfthroughthecheapeningofcommoditiesandthecompulsiontoproducecommoditiesunderthesamefavourableconditions。
Butmattersaredifferentwiththesurplus-profitofanindustrialcapitalistwhomakesuseofthewaterfall。Theincreasedproductivenessofthelabourusedbyhimcomesneitherfromthecapitalandlabouritself，norfromthemereapplicationofsomenaturalforcedifferentfromcapitalandlabourbutincorporatedinthecapital。ItarisesfromthegreaternaturalproductivenessoflabourboundupwiththeapplicationofaforceofNature，butnotaforceofNaturethatisatthecommandofallcapitalinthesamesphereofproduction，asforexampletheelasticityofsteam。Inotherwords，itsapplicationisnottobetakenforgrantedwhenevercapitalisgenerallyinvestedinthissphereofproduction。Onthecontrary，itisamonopolisableforceofNaturewhich，likethewaterfall，isonlyatthecommandofthosewhohaveattheirdisposalparticularportionsoftheearthanditsappurtenances。
Itisbynomeanswithinthepowerofcapitaltocallintoexistencethisnaturalpremiseforagreaterproductivityoflabourinthesamemannerasanycapitalmaytransformwaterintosteam。ItisfoundonlylocallyinNatureand，whereveritdoesnotexist，itcannotbeestablishedbyadefiniteinvestmentofcapital。Itisnotboundtogoodswhichlabourcanproduce，suchasmachinesandcoal，buttospecificnaturalconditionsprevailingincertainportionsofland。Thosemanufacturerswhoownwaterfallsexcludethosewhodonotfromusingthisnaturalforce，becauseland，andparticularlylandendowedwithwater-power，isscarce。Thisdoesnotpreventtheamountofwater-poweravailableforindustrialpurposesfrombeingincreased，eventhoughthenumberofnaturalwaterfallsinagivencountryislimited。Thewaterfallmaybeharnessedbymaninordertofullyexploititsmotiveforce。Ifsuchexists，thewater-wheelmaybeimprovedsoastomakeuseofasmuchofthewater-poweraspossible；wheretheordinarywheelisnotsuitableforthewater-supply，turbinesmaybeused，etc。
Thepossessionofthisnaturalforceconstitutesamonopolyinthehandsofitsowner；itisaconditionforanincreaseintheproductivenessoftheinvestedcapitalthatcannotbeestablishedbytheproductionprocessofthecapitalitself；[33]thisnaturalforce，whichcanbemonopolisedinthismanner，isalwaysboundtotheland。Suchanaturalforcedoesnotbelongtothegeneralconditionsofthesphereofproductioninquestion，nortothoseconditionsofthelatterwhichmaybegenerallyestablished。
Nowletusassumethatthewaterfalls，alongwiththelandtowhichtheybelong，areheldbyindividualswhoareregardedasownersoftheseportionsoftheearth，i。e。，whoarelandowners。Theseownerspreventtheinvestmentofcapitalinthewaterfallsandtheirexploitationbycapital。
Theycanpermitorforbidsuchutilisation。Butawaterfallcannotbecreatedbycapitaloutofitself。Therefore，thesurplus-profitwhicharisesfromtheemploymentofthiswaterfallisnotduetocapital，buttotheutilisationofanaturalforcewhichcanbemonopolised，andhasbeenmonopolised，bycapital。Underthesecircumstances，thesurplus-profitistransformedintoground-rent，thatis，itfallsintopossessionoftheownerofawaterfall。
Ifthemanufacturerpaystheownerofawaterfall£；10annually，thenhisprofitis£；15，thatis，15%onthe£；100whichthenmakeuphiscostofproduction；andheisjustaswellorpossiblybetteroffthanallothercapitalistsinhissphereofproductionwhooperatewithsteam。Itwouldnotaltermattersonebitifthecapitalisthimselfshouldbetheownerofawaterfall。Hewould，insuchacase，pocketasbeforethesurplus-profitof£；10inhiscapacityaswaterfallowner，andnotinhiscapacityascapitalist；andpreciselybecausethissurplusdoesnotstemfromhiscapitalassuch，butratherfromthecontrolofalimitednaturalforcedistinctfromhiscapitalwhichcanbemonopolised，isittransformedintoground-rent。
First，itisevidentthatthisrentisalwaysadifferentialrent，foritdoesnotenterasadeterminingfactorintothegeneralproductionpriceofcommodities，butratherisbasedonit。Itinvariablyarisesfromthedifferencebetweentheindividualproductionpriceofaparticularcapitalhavingcommandoverthemonopolisednaturalforce，ontheonehand，andthegeneralproductionpriceofthetotalcapitalinvestedinthesphereofproductionconcerned，ontheother。
Secondly，thisground-rentdoesnotarisefromtheabsoluteincreaseintheproductivenessofemployedcapital，orlabourappropriatedbyit，sincethiscanonlyreducethevalueofcommodities；itisduetothegreaterrelativefruitfulnessofspecificseparatecapitalsinvestedinacertainproductionsphere，ascomparedwithinvestmentsofcapitalwhichareexcludedfromtheseexceptionalandnaturalconditionsfavouringproductiveness。
Forinstance，iftheuseofsteamshouldofferoverwhelmingadvantagesnotofferedbytheuseofwater-power，despitethefactthatcoalhasvalueandthewater-powerhasnot，andiftheseadvantagesmorethancompensatedfortheexpense，then，thewater-powerwouldnotbeusedandcouldnotproduceanysurplus-profit，andthereforecouldnotproduceanyrent。
Thirdly，thenaturalforceisnotthesourceofsurplus-profit，butonlyitsnaturalbasis，becausethisnaturalbasispermitsanexceptionalincreaseintheproductivenessoflabour。Inthesameway，use-valueisingeneralthebearerofexchange-value，butnotitscause。Ifthesameuse-valuecouldbeobtainedwithoutlabour，itwouldhavenoexchange-value，yetitwouldretain，asbefore，thesamenaturalusefulnessasuse-value。
Ontheotherhand，nothingcanhaveexchange-valueunlessithasuse-value，i。e。，unlessitisanaturalbeareroflabour。Wereitnotforthefactthatthevariousvaluesareaveragedoutintopricesofproduction，andthevariousindividualpricesofproductionintoageneralpriceofproductionregulatingthemarket，themereincreaseinproductivityoflabourthroughutilisationofthewaterfallwouldmerelylowerthepriceofcommoditiesproducedwiththeaidofthiswaterfall，withoutincreasingtheshareofprofitcontainedinthesecommodities。Similarly，ontheotherhand，thisincreasedproductivityoflabouritselfwouldnotbeconvertedintosurplus-valuewereitnotforthefactthatcapitalappropriatesthenaturalandsocialproductivityofthelabourusedbyitasitsown。
Fourthly，theprivateownershipofthewaterfallinitselfhasnothingtodowiththecreationofthesurplus-valueprofitportion，andtherefore，ofthepriceofthecommodityingeneral，whichisproducedbymeansofthewaterfall。Thissurplus-profitwouldalsoexistiflandedpropertydidnotexist；forinstance，ifthelandonwhichthewaterfallissituatedwereusedbythemanufacturerasunclaimedland。Hencelandedpropertydoesnotcreatetheportionofvaluewhichistransformedintosurplus-profit，butmerelyenablesthelandowner，theownerofthewaterfall，tocoaxthissurplus-profitoutofthepocketofthemanufacturerandintohisown。Itisnotthecauseofthecreationofsuchsurplus-profit，butisthecauseofitstransformationintotheformofground-rent，andthereforeoftheappropriationofthisportionoftheprofit，orcommodity-price，bytheownerofthelandorwaterfall。
Fifthly，itisevidentthatthepriceofthewaterfall，thatis，thepricewhichthelandownerwouldreceivewerehetosellittoathirdpartyoreventothemanufacturerhimself，doesnotimmediatelyenterintotheproductionpriceofthecommodities，althoughitdoesenterintotheindividualcost-priceofthemanufacturer；becausetherentarisesherefromthepriceofproductionofsimilarcommoditiesproducedbysteammachinery，andthispriceisregulatedindependentlyofthewaterfall。Furthermore，thispriceofthewaterfallonthewholeisanirrationalexpression，butbehinditisbiddenarealeconomicrelationship。Thewaterfall，likelandingeneral，andlikeanynaturalforce，hasnovaluebecauseitdoesnotrepresentanymaterialisedlabour，andtherefore，ithasnoprice，whichisnormallynomorethantheexpressionofvalueinmoneyterms。Wherethereisnovalue，thereisalsoeoipsonothingtobeexpressedinmoney。
Thispriceisnothingmorethanthecapitalisedrent。Landownershipenablesthelandownertoappropriatethedifferencebetweentheindividualprofitandaverageprofit。Theprofitthusacquired，whichisrenewedeveryyear，maybecapitalised，andappearsthenasthepriceofthenaturalforceitself。Ifthesurplus-profitrealisedbythemanufacturerusingthewaterfallamountsto£；10peryear，andtheaverageinterestis5%，thenthese£；10representtheannualinterestonacapitalof£；200andthecapitalisationoftheannual£；10whichthewaterfallenablesitsownertoappropriatefromthemanufacturer，appearsthenasthecapital-valueofthewaterfallitself。Thatitisnotthewaterfallitselfwhichhasvalue，butthatitspriceisamerereflectionoftheappropriatedsurplus-profitcapitalisticallycalculated，becomesatonceevidentfromthefactthatthepriceof£；200representsmerelytheproductobtainedbymultiplyingasurplus-profitof£；10by20years，whereas，otherconditionsremainingequal，thesamewaterfallwillenableitsownertoappropriatethese£；10
everyyearforanindefinitenumberofyears-30years，100years，orxyears；and，whereas，ontheotherhand，shouldsomenewmethodofproductionnotapplicablewithwater-powerreducethecost-priceofcommoditiesproducedbysteammachineryfrom£；100to£；90，thesurplus-profit，andtherebytherent，andthusthepriceofthewaterfall，woulddisappear。
Nowthatwehavedescribedthegeneralconceptofdifferentialrent，weshallpassontoitsconsiderationinagricultureproper。Whatappliestoagriculturewillalsoapplyonthewholetomining。
NOTES
33。Concerningextraprofit，seetheInquiry[intothosePrinciples，RespectingtheNatureofDemandandtheNecessityofConsumption，latelyadvocatedbyMr。Malthus，London，1821-Ed。]againstMalthus。1894:CapitalIII——Chapter39KarlMarx’sCAPITAL
volumeIII
THEPROCESSOFCAPITALISTPRODUCTIONASAWHOLECHAPTERXXXIX
FIRSTFORMOFDIFFERENTIALRENTDIFFERENTIALRENTIRicardoisquiterightinthefollowingobservations:”Rentisalwaysthedifferencebetweentheproduceobtainedbytheemploymentoftwoequalquantitiesofcapitalandlabour”Principles，p。59。[Hemeansdifferentialrent，forheassumesthatnootherrentbutdifferentialrentexists。]Heshouldhaveadded，”onequalareasofland”insofarasitisamatterofground-rentandnotsurplus-profitingeneral。
Inotherwords，surplus-profit，ifnormalandnotduetoaccidentaloccurrencesinthecirculationprocess，isalwaysproducedasadifferencebetweentheproductsoftwoequalquantitiesofcapitalandlabour，andthissurplus-profitistransformedintogroundrentwhentwoequal。quantitiesofcapitalandlabourareemployedonequalareasoflandwithunequalresults。Moreover，itisbynomeansabsolutelynecessaryforthissurplus-profittoarisefromtheunequalresultsofequalquantitiesofinvestedcapital。
Thevariousinvestmentsmayalsoemployunequalquantitiesofcapital。
Indeed，thisisgenerallythecase。Butequalproportions，forinstance£；100ofeach，produceunequalresults；thatis，theirratesofprofitaredifferent。Thisisthegeneralprerequisitefortheexistenceofsurplus-profitinanysphereofcapitalinvestment。Thesecondprerequisiteisthetransformationofthissurplus-profitintotheformofground-rentofrentingeneralasaformdistinctfromprofit；itmustbeinvestigatedineachcasewhen，how，underwhatconditionsthistransformationtakesplace。
Ricardoisalsorightinthefollowingobservation，provideditislimitedtodifferentialrent:”Whateverdiminishestheinequalityintheproduceobtainedonthesameoronnewland，tendstolowerrent，andwhateverincreasesthatinequality，necessarilyproducesanoppositeeffectandtendstoraiseit”p。74。
However，amongthesecausesarenotmerelythegeneralonesfertilityandlocation，butalso1thedistributionoftaxes，dependingonwhetheritoperatesuniformlyornot；thelatterisalwaysthecasewhen，asinEngland，itisnotcentralisedandwhenthetaxisleviedonland，notonrent；2theinequalitiesarisingfromadifferenceinagriculturaldevelopmentindifferentpartsofthecountry，sincethislineofproduction，owingtoitstraditionalcharacter，evensoutwithmoredifficultythanmanufacture；and3theinequalityindistributionofcapitalamongcapitalisttenants。Sincetheinvasionofagriculturebythecapitalistmodeofproduction，transformationofindependentlyproducingpeasantsintowage-workers，isinfactthelastconquestofthismodeofproduction，theseinequalitiesaregreaterherethaninanyotherlineofproduction。
Havingmadethesepreliminaryremarks，IwillfirstpresentabriefsummaryofthecharacteristicfeaturesofmyanalysisincontradistinctiontothatofRicardo，etc。
Weshallfirstconsidertheunequalresultsofequalquantitiesofcapitalappliedtodifferentplotsoflandofequalsize；or，inthecaseofunequalsize，resultscalculatedonthebasisofequalareas。
Thetwogeneralcausesoftheseunequalresults-quiteindependentofcapital-aie:1Fertility。Withreferencetothisfirstpoint，itwillbenecessarytodiscusswhatismeantbynaturalfertilityoflandandwhatfactorsareinvolved。2Thelocationoftheland。Thisisadecisivefactorinthecaseofcoloniesandingeneraldeterminesthesequenceinwhichplotsoflandcanbecultivated。Furthermore，itisevidentthatthesetwodifferentcausesofdifferentialrent-fertilityandlocation-mayworkinoppositedirections。Acertainplotoflandmaybeveryfavourablylocatedandyetbeverypoorinfertility，andviceversa。Thiscircumstanceisimportant，foritexplainshowitispossiblethatbringingintocultivationthelandofacertaincountrymayequallywellproceedfromthebettertotheworselandasviceversa。Finally，itisclearthattheprogressofsocialproductioningeneralhas，ontheonehand，theeffectofeveningoutdifferencesarisingfromlocationasacauseofground-rent，bycreatinglocalmarketsandimprovinglocationsbyestablishingcommunicationandtransportationfacilities；ontheotherhand，itincreasesthedifferencesinindividuallocationsofplotsoflandbyseparatingagriculturefrommanufacturingandforminglargecentresofproduction，ontheonehand，whilerelativelyisolatingagriculturaldistricts，ontheother。
Forthepresent，however，weshallleavethispointconcerninglocationoutofconsiderationandconfineourselvestonaturalfertility。
Asidefromclimaticfactors，etc。，thedifferenceinnaturalfertilitydependsonthechemicalcompositionofthetopsoil，thatis，onitsdifferentplantnutritioncontent。However，assumingthechemicalcompositionandnaturalfertilityinthisrespecttobethesamefortwoplotsofland，theactualeffectivefertilitydiffersdependingonwhethertheseelementsofplantnutritionareinaformwhichmaybemoreorlesseasilyassimilatedandimmediatelyutilisedfornourishingthecrops。Hence，itwilldependpartlyuponchemicalandpartlyuponmechanicaldevelopmentsinagriculturetowhatextentthesamenaturalfertilitymaybemadeavailableonplotsoflandofsimilarnaturalfertility。Fertility，althoughanobjectivepropertyofthesoil，alwaysimpliesaneconomicrelation，arelationtotheexistingchemicalandmechanicallevelofdevelopmentinagriculture，and，therefore，changeswiththislevelofdevelopment。Whetherbychemicalmeanssuchastheuseofcertainliquidfertilisersonstiffclaysoilandcalcinationofheavyclayeysoilsormechanicalmeanssuchasspecialploughsforheavysoils，theobstacleswhichmadeasoilofequalfertilityactuallylessfertilecanbeeliminateddrainagealsobelongsunderthishead。Oreventhesequenceintypesofsoilstakenundercultivationmaybechangedthereby，aswasthecase，forinstance，withlightsandysoilandheavyclayeysoilatacertainperiodofdevelopmentinEnglishagriculture。
Thisshowsonceagainthathistorically，inthesequenceofsoilstakenundercultivation，onemaypassoverfrommorefertiletolessfertilesoilsaswellasviceversa。Thesameresultsmaybeobtainedbyanartificiallycreatedimprovementinsoilcompositionorbyamerechangeinagriculturalmethods。Finally，thesameresultmaybebroughtaboutbyachangeinthehierarchicalarrangementofthesoiltypesduetodifferentconditionsofthesubsoil，assoonasthelatterlikewisebeginstobetilledandturnedoverintotoplayers。Thisisinpartdependentontheemploymentofnewagriculturalmethodssuchasthecultivationoffodder-grassandinpartontheemploymentofmechanicalmeanswhicheitherturnthesubsoiloverintotoplayers，mixitwithtopsoil，orcultivatethesubsoilwithoutturningitup。
Alltheseinfluencesuponthedifferentialfertilityofvariousplotsoflandaresuchthatfromthestandpointofeconomicfertility，theleveloflabourproductivity，inthiscasethecapacityofagriculturetomakethenaturalsoilfertilityimmediatelyexploitable——acapacitywhichdiffersinvariousperiodsofdevelopment——isasmuchafactorinso-callednaturalsoilfertilityasitschemicalcompositionandothernaturalproperties。
Weassume，then，theexistenceofaparticularstageofdevelopmentinagriculture。Weassumefurthermorethatthehierarchicalarrangementofsoiltypesaccordswiththisstageofdevelopment，asis，ofcourse，alwaysthecaseforsimultaneouscapitalinvestmentsondifferentplotsofland。Differentialrentmaythenformeitheranascendingoradescendingsequence，foralthoughthesequenceisgivenforthetotalityofactuallycultivatedplotsofland，aseriesofmovementsleadingtoitsformationhasinvariablytakenplace。
Letusassumetheexistenceoffourkindsofsoil:A，B，C，D。
Letusfurthermoreassumethepriceofonequarterofwheat=£；3，or60shillings。Sincetherentissolelydifferentialrent，thispriceof60shillingsperquarterfortheworstsoilisequaltothepriceofproduction，thatis，equaltothecapitalplusaverageprofit。LetAhethisworstsoil，whichyieldsIquarter=60shillingsforeach50shillingsspent；hencetheprofitamountsto10shillings，or20%。
LetByield2quarters=120shillingsforthesameexpenditureThiswouldmean70shillingsofprofit，orasurplus-profitof60shillings。
LetCyield3quarters=180shillingsforthesameexpenditure；
totalprofit=130shillings；surplus-profit=120shillings。
LetDyield4quarters=240shillings=180shillingsofsurplus-profit。
Wewouldthenhavethefollowingsequence:
TABLEI
TypeofSoilProductCapitalAdvancedProfitRentQuar-tersShil-ingsQuar-tersShil-ingsQuar-tersShil-ingsABCD123460120180240505050501/611/621/631/61070130190——123——60120180
Total……10qrs600sh。6qrs360sh。Therespectiverentsare:D=190sh-l0sh。，orthedifferencebetweenDandA；C=130sh-l0sh。，orthedifferencebetweenCandA；B=7Osh-10sh。，orthedifferencebetweenBandA；andthetotalrentforB，C，D=6quarters=360
shillings，equaltothesumofthedifferencesbetweenDandA，CandA，BandA。
Thissequence，whichrepresentsagivenproductinagivenconditionmay，consideredabstractlywehavealreadyofferedthereasonswhythismayhethecaseinreality，descendfromDtoA，fromfertiletolessandlessfertilesoil，orrisefromAtoD，fromrelativelypoortomoreandmorefertilesoil，or，finally，mayfluctuate，i。e。，nowrising，nowdescending——forinstancefromDtoC，fromCtoA，andfromAtoB。
Theprocessinthecaseofadescendingsequencewasasfollows:
Thepriceofaquarterofwheatrosegraduallyfrom，say，15shillingsto60shillings。Assoonasthe4quartersproducedbyDwemayconsiderthese4quartersassomanymillionquartersnolongersufficed，thepriceofwheatrosetoapointwherethesupplyshortagecouldbeproducedbyC。Thatistosay，thepriceofwheatmusthaverisento20shillingsperquarter。Whenithadrisento30shillingsperquarter，Bcouldbetakenundercultivation，andwhenitreached60shillingsAcouldbetakenundercultivation；andthecapitalinvesteddidnothavetocontentitselfwitharateofprofitlowerthan20%。Inthismanner，arentwasestablishedforD，firstof5shillingsperquarter=20shillingsforthe4quartersproducedbyit；thenof15shillingsperquarter=60shillings，thenof45shillingsperquarter=180shillingsfor4quarters。
IftherateofprofitofDoriginallywassimilarly=20%，thenitstotalprofiton4quartersofwheatwasaJsobut10shillings，butthisrepresentedmoregrainwhenthepricewas15shillingsthanitdoeswhenthepriceis60shillings。Butsincethegrainentersintothereproductionoflabour-power，andpartofeachquarterhastomakegoodsomeportionofwagesandanotherconstantcapital，thesurplus-valueundertheseconditionswashigher，andthusotherthingsbeingequaltherateofprofittoo。Thematterofrateofprofitwillhavetobespeciallyanalysed，andingreaterdetail。
Ontheotherhand，ifthesequencewereinthereverseorder，thatis，iftheprocessinitiatedfromA，thenthepriceofwheatatfirstwouldriseabove60shillingsperquarterwhennewlandwouldhavetobetakenundercultivation。ButsincethenecessarysupplywouldbeproducedbyB，asupplyof2quarters，thepricewouldfallto60shillingsagain，forBproducedwheatatacostof30shillingsperquarter，butsolditat60shillingsbecausethesupplyjustsufficedtocoverthedemand。Thusarentwasformed，firstof60shillingsforB，andinthesamewayforCandD；itisassumedthroughoutthatthemarket-priceremainedat60
shillings，althoughCandDproducedwheathavinganactualvalueof20
and15shillingsperquarterrespectively，becausethesupplyoftheonequarterproducedbyAwasneededasmuchasevertosatisfythetotaldemand。
Inthiscase，theincreaseindemandabovesupply，whichwasfirstsatisfiedbyA，thenbyAandB，wouldnothavemadeitpossibletocultivateB，CandDsuccessivejy，butwouldmerelyhavecausedageneralextensionofthesphereofcultivation，andthemorefertilelandsmightonlylatercomeundercultivation。
Inthefirstsequence，anincreaseinpricewouldraisetherentanddecreasetherateofprofit。Suchadecreasemightbeentirelyorpartiallycheckedbycounteractingcircumstances。Thispointwillhavetobetreatedlaterinmoredetail。Itshouldnotbeforgottenthatthegeneralrateofprofitisnotdetermineduniformlyinallspheresofproductionbythesurplus-value。Itisnottheagriculturalprofitwhichdeterminesindustrialprofit，butviceversa。Butofthismoreanon。
Inthesecondsequencetherateofprofitoninvestedcapitalwouldremainthesame。Theamountofprofitwouldberepresentedbylessgrain；buttherelativepriceofgrain，comparedwiththatofothercommodities，wouldhaverisen。However，theincreaseinprofitwhereversuchanincreasetakesplace，becomesseparatedfromtheprofitintheformofrent，insteadofflowingintothepocketsofthecapitalisttenantfarmerandappearingasagrowingprofit。Thepriceofgrain，however，couldremainunchangedundertheconditionsassumedhere。
Thedevelopmentandgrowth，ofdifferentialrentwouldremainthesameforfixedaswellasforincreasingprices，andforacontinuousprogressionfromworsetobettersoilsaswellasforacontinuousretrogressionfrombettertoworsesoils。
Thusfarwehaveassumed:1thatthepricerisesinonesequenceandremainsstationaryintheother；2thatthereisacontinuousprogressionfrombettertoworsesoil，orfromworsetobettersoil。
Butnowletusassumethatthedemandforgrainrisesfromitsoriginalfigureof10to17quarters；furthermore，thattheworstsoilAisdisplacedbyanothersoilA，whichproduces11/3quartersatapriceofproductionof60shillings50sh。costpluslOsh。for20%profit，sothatitspriceofproductionperquarter=45shillings；or，perhaps，theoldsoilAmayhaveimprovedthroughcontinuousrationalcultivation，orbecultivatedmoreproductivelyatthesamecost，forinstancethroughtheintroductionofclover，etc。，sothatitsoutputwiththesameinvestmentofcapitalrisesto11/3quarters。LetusalsoassumethatsoiltypesB，CandDyieldthesameoutputaspreviously，butthatnewsoiltypeshavebeenintroduced，forinstance，A’withafertilitylyingbetweenA
andB，andalsoB’andB”withafertilitybetweenBandC。Weshouldthenobservethefollowingphenomena:
First:Thepriceofproductionofaquarterofwheat，oritsregulatingmarket-price，fallsfrom60shillingsto45shillings，orby25%。
Second:Thecultivationproceedssimultaneouslyfrommorefertiletolessfertilesoil，andfromlessfertiletomorefertilesoil。
SoilA’ismorefertilethanA，butlessfertilethanthehithertocultivatedsoilsB，CandD。B’andB”aremorefertilethanA’，A’andB，butlessfertilethanCandD。Thesequencethusproceedsincrisscrossfashion。
CultivationdoesnotproceedtosoilabsolutelylessfertilethanA，etc。，buttorelativelylessfertilesoilwithrespecttothehithertomostfertilesoiltypesCandontheotherhand，cultivationdoesnotproceedtosoilabsolutelymorefertile，buttorelativelymorefertilesoilwithrespecttothehithertoleastfertilesoilA，orAandB。
Thirdly:TherentonBfalls；likewisetherentonCandD；butthetotalrentalingrainrisesfrom6quartersto72/3；theamountofcultivatedandrent-yieldinglandincreases，andtheamountofproducerisesfrom10quartersto17。Theprofit，althoughitremainsthesameforA，risesifexpressedingrain，buttherateofprofititselfmightrise，becausetherelativesurplus-valuedoes。Inthiscase，thewage，i。e。，theinvestmentofvariablecapitalandthereforethetotaloutlay，isreducedbecauseoftbecheapeningofmeansofsubsistence。Thistotalrentalexpressedinmoneyfallsfrom360shillingsto345shillings。
TABLEII
TypeofSoilProductCapi-talInvest-mentProfitRentPriceofProductionperQuaterQuar-tersShil-ingsQuar-tersShil-ingsQuar-tersShil-ingsAA’BB’B”CD11/3
12/3
2
21/3
22/3
3
4607590105120135180505050505050502/95/98/912/915/918/928/9102540557085130——
1/3
2/3
1
11/3
12/3
22/3——153045607512045sh。
36sh。
30sh。
255/7*sh。
221/2sh。
20sh。
15sh。
Total……1772/3345*IntheGerman1894editionthisreads:252/7——Ed。
Letusdrawupthenewsequence。[Seep。655——Ed。J
Finally，ifonlysoiltypesA，B，CandDwerecultivatedasbefore，buttheirproductivenessroseinsuchawaythatAproduced2quartersinsteadof1quarter，B-4quartersinsteadof2，C-7quartersinsteadof3，andD-10quartersinsteadof4，sothatthesamecausesaffectthevarioustypesofsoildifferently，thetotalproductionincreasesfrom10quartersto23。Assumingthatdemandabsorbsthese23quartersthroughanincreaseinpopulationandafallinprices，weshouldobtainthefollowingresult:
TABLEIII
TypeofSoilProductCapitalInvestmentPriceofProductionperQuarterProfitRentQuar-tersShil-ingsQuar-tersShil-ingsQuar-tersShil-ingsABCD247106012021030050505050301584/761/321/351/381/310701602500258060150240
Total……2315450Thenumericalproportionsinthisandinothertablesarechosenatrandombuttheassumptionsarequiterational。
Thefirstandprincipalassumptionisthatanimprovementinagricultureactsdifferentlyupondifferentsoils，andinthiscaseaffectsthebesttypesofsoil，CandD，morethantypesAandB。Experiencehasshownthatthisisgenerallythecase，althoughtheoppositemayalsotakeplace。
Iftheimprovementaffectedthepoorersoilsmorethanthebetterones，rentonthelatterwouldhavefalleninsteadofrisen。Butinourtable，wehaveassumedthattheabsolutegrowthinfertilityofallsoiltypesissimultaneouslyaccompaniedbyanincreaseingreaterrelativefertilityofthebettersoiltypes，CandD；thismeansanincreaseinthedifferencebetweentheproductatthesamecapitalinvestment，andthusanincreaseindifferentialrent。
Thesecondassumptionisthattotaldemandkeepspacewiththeincreaseinthetotalproduct。First，oneneednotimaginesuchanincreasecomingaboutabruptly，butrathergradually-untilsequenceIIIisestablished。
Secondly，itisnottruethattheconsumptionofnecessitiesoflifedoesnotincreaseastheybecomecheaper。TheabolitionoftheCornLawsinEnglandprovedthereversetobethecaseF。Newman，LecturesonPoliticalEconomy，London，1851，p。158——Ed。；theoppositeviewstemssolelyfromthefactthatlargeandsuddendifferencesinharvests，whicharemereresultsofweather，bringaboutatonetimeanextraordinaryfall，atanotheranextraordinaryrise，ingrainprices。Whileinsuchacasethesuddenandshort-livedreductioninpricedoesnothavetimetoexertitsfulleffectupontheextensionofconsumption，theoppositeistruewhenareductionarisesfromtheloweringoftheregulatingpriceofproductionitself，i。e。，isofalong-termnature。Thirdly，apartofthegrainmaybeconsumedintheformofbrandyorbeer；andtheincreasingconsumptionofbothoftheseitemsisbynomeansconfinedwithinnarrowlimits。Fourthly，thematterdependsinpartupontheincreaseinpopulationandinpartonthefactthatthecountrymaybegrain-exporting，asEnglandstillwaslongafterthemiddleofthe18thcentury，sothatthedemandisnotsolelyregulatedwithintheconfinesofnationalconsumption。Finally，theincreaseandpricereductioninwheatproductionmayresultinmakingwheat，insteadofryeoroats，theprincipalarticleofconsumptionforthemasses，sothatthedemandforitmaygrowifonlyforthisreason，justastheoppositemaytakeplacewhenproductiondecreasesandpricesrise-Thus，undertheseassumptions，andwiththepreviouslyselectedratios，sequenceIIIyieldstheresultthatthepriceperquarterfallsfrom60
to30shillings，thatis，by50%；thatproduction，comparedtosequenceI，increasesfrom10to23quarters，i。e。，by130%；thattherentremainsfixedforsoilB，increasesby25%IntheGerman1894editionthisreads:
doubles——Ed。forC，andby331/3%Ibid。p22——Ed。
forD；andthatthetotalrentalincreasesfrom£；18to£；22
1/2，Ibid。22——Ed。，by25%。Ibid。:22
1/9%——Ed。
AcomparisonofthesethreetableswherebysequenceIistobetakentwice，risingfromAtoD，anddescendingfromDtoA，whichmaybeconsideredeitherasgivengradationsundersomestageofsociety，forinstance，asexistingsidebysideinthreedifferentcountries，orassucceedingoneanotherindifferentperiodsofdevelopmentwithinthesamecountry，shows:
1Thesequence，whencomplete，whateverthecourseofitsformativeprocessmayhavebeen，invariablyappearsasbeinginadescendingline；
forwhenanalysingrentthepointofdeparturewillalwaysbelandyieldingthemaximumrent，andonlyfinallydowecometolandyieldingnorent。
2Thepriceofproductionontheworstsoil，i。e。，whichyieldsnorent，isalwaystheoneregulatingthemarket-price，althoughthelatterinTableI，ifitssequencewereformedinanascendingline，onlyremainedfixedbecausebetterandbettersoilwasconstantlydrawnintocultivation。
Insuchacase，thepriceofgrainproducedonthebestsoilisaregulatingoneillsofarasitdependsuponthequantityproducedonsuchsoiltowhatextentsoiltypeAremainstheregulator。IfB，CandDshouldproducemorethandemandrequires，Awouldceasetobetheregulator。Storchhasthispointhazilyinmindwhenheadoptsthebestsoiltypeastheregulatingone。H。Storch，Coursd’econom’iepoilitique，ouExpositiondesprincipesqutdeterminentlaprosperitedesnations，TomeII，St-Petersbourg，1815，pp。78-79——Ed。Inthismanner，theAmericanpriceofgrainregulatestheEnglishprice。
3Differentialrentarisesfromdifferencesinthenaturalfertilityofthesoilwhichisgivenforeverygivenstageofagriculturaldevelopmentleavingasideforthepresentthequestionoflocation；inotherwords，fromthelimitedareaofthebestland，andfromthecircumstancethatequalamountsofcapitalmustbeinvestedonunequaltypesofsoil，sothatanunequalproductresultsfromthesameamountofcapital。
4Theexistenceofadifferentialrentandofagraduateddifferentialrentcandevelopequallywellinadescendingsequence，whichproceedsfrombettertoworsesoils，asinanascendingone，whichprogressesintheoppositedirectionfromworsetobettersoils；oritmaybebroughtaboutincheckeredfashionbyalternatingmovements。SequenceImaybeformedbyproceedingfromDtoA，orfromAtoD；sequenceIIcomprisesbothtypesofmovement。
5Dependingonitsmodeofformation，differentialrentmaydevelopalongwithastationary，risingorfallingpriceoftheproductsoftheland。Inthecaseofafallingprice，totalproductionandtotalrentalmayrise，andrentmaydeveloponhithertorentlessland，eventhoughtheworstsoilAmayhavebeendisplacedbyabetteroneormayitselfhaveimproved，andeventhoughtherentmaydecreaseonotherlandwhichisbetter，oreventhebestTableII；thisprocessmayalsobeconnectedwithafallintotalrentinmoney。Finally，atatimewhenpricesfallonaccountofageneralimprovementincultivation，sothattheproductoftheworstsoilanditspricedecrease，therentonsomeofthebettersoilsmayremainthesame，ormayfall，whileitmayriseonthebestones。
Nevertheless，thedifferentialrentofeverysoil，comparedwiththeworstsoil，depends，ifthedifferenceinquantityofproductsisgiven，upontheprice，say，ofaquarterofwheat。Butwhenthepriceisgiven，differentialrentdependsuponthemagnitudeofthedifferenceinquantityofproducts，andifwithanincreasingabsolutefertilityofallsoilsthatofthebetteronesgrowsrelativelymorethanthatoftheworseones，themagnitudeofthisdifferencegrowsproportionately。InthiswayseeTableI，whenthepriceis60shillings，therentonDisdeterminedbyitsdifferentialproductascomparedwithA；inotherwords，bythesurplusof3quarters。
Therentistherefore=3x60=l80shillings。ButinTableIII，wheretheprice=30
shillings，therentisdeterminedbythequantityofsurplus-productofDascomparedwithA=8quarters；wethereforeobtain8X30=240shillings。
Thistakescareofthefirstfalseassumptionregardingdifferentialrent-stillfoundamongWest，Malthus，andRicardo——narnely，thatitnecessarilypresupposesamovementtowardworseandworsesoil，oranever-decreasingfertilityofthesoil。[West]EssayontheApplication0fCapitaltoLand，London，1815。Maitbus，PrinciplesofPolittcalEconomy，London，4836。Maithus，AnInquiryintotheNatureandProgressofRent，andthePrinctplesbywhichitisregulated，London，1815。
Ricardo，OnthePrinciplesofPoliticalEconomy，andTaxation，Thirdedition，London，4824，Chap。11——Ed。Itcanbeformed，aswehaveseen，withamovementtowardbetterandbettersoil；itcanbeformedwhenabettersoiltakesthelowestpositionthatwasformerlyoccupiedbytheworstsoil；itcanbeconnectedwithaprogressiveimprovementinagriculture。
Thepreconditionismerelytheinequalityofdifferentkindsofsoil。Sofarastheincreaseinproductivityisconcerned，itassumesthattheincreaseinabsolutefertilityofthetotalareadoesnoteliminatethisinequality，buteitherincreasesit，leavesitunchanged，ormerelyreducesit。
Fromthebeginningtothemiddleofthe18thcentury，England’sgrainpricesconstantlyfellinspiteofthefallingpricesofgoldandsilver，whileatthesametimeviewingthisentireperiodasawhole
therewasanincreaseinrent，intheover-allamountofrent，intheareaofcultivatedland，inagriculturalproduction，andinpopulation。ThiscorrespondstoTableItakeninconjunctionwithTableIIinanascendingline，butinsuchawaythattheworstlandAiseitherimprovedoreliminatedfromthegrain-producingarea；however，thisdoesnotmeanthatitwasnotusedforotheragriculturalorindustrialpurposes。
Fromtheearly19thcenturydatetobespecifiedmoreprecisely
until1815thereisaconstantriseingrainprices，accompaniedbyasteadyincreaseinrent，intheover-allamountofrent，intheareaofcultivatedland，inagriculturalproduction，andinpopulation。ThiscorrespondstoTableIinadescendingline。Citesomesourceshereonthecultivationofinferiorlandinthatperiod。
InPetty’sandDavenant’stime，farmersandlandownerscomplainedaboutimprovementsandthebringingintocultivationofnewland；therentonbetterlandsdecreased，andthetotalamountofrentincreasedthroughtheextensionoftheareaoflandyieldingrent。
Thesethreepointsshouldbeillustratedlaterbyquotations；likewiseforthedifferenceinfertilityofvariouscultivatedsectionsoflandinaparticularcountry。
Regardingdifferentialrentingeneral，itistobenotedthatthemarket-valueisalwaysabovethetotalpriceofproductionofthetotalquantityofproducts。Asanexample，letustakeTableI。Tenqilartersoftotalproductaresoldfor600shillingsbecausethemarket-priceisdeterminedbythepriceofproductionofA，whichamountsto60shillingsperquarter。Buttheactualpriceofproductionis:
A……Iqr=60sh。Iqr=60sb。
B……2qrs=60sb。Iqr=30sh。
C……3qrs=60Sb。Iqr=20ahD……4qrs=60sh。Iqr=15ah。
10qrs=240sh。Average1qr=24sh。Theactualpriceofproductionofthese10quartersis240shillings；buttheyaresoldfor600shillings，i。e。，at250%ofthepriceofproduction。
TheactualaveragepriceforIquarteris24shillings；themarket-priceis60shillings，i。e。，also250%oftheproductionprice。
Thisisdeterminationbymarket-valueasitassertsitselfonthebasisofcapitalistproductionthroughcompetition；thelattercreatesafalsesocialvalue。Thisarisesfromthelawofmarketvalue，towhichtheproductsofthesoilaresubject。Thedeterminationofthemarket-valueofproducts，includingthereforeagriculturalproducts，isasocialact，albeitasociallyunconsciousandunintentionalone。Itisbasednecessarilyupontheexchange-valueoftheproduct，notuponthesoilandthedifferencesinitsfertility。Ifwesupposethecapitalistformofsocietytobeabolishedandsocietyorganisedasaconsciousandplannedassociation，thenthe10quarterswouldrepresentaquantityofindependentlabour-timeequaltothatcontainedin240shillings。Societywouldnotthenbuythisagriculturalproductattwoandahalftimestheactuallabour-timeembodiedinitandthebasisforaclassoflandownerswouldthusbedestroyed。Thiswouldhavethesameeffectasareductioninpriceoftheproducttothesameamountresultingfromforeignimports。Whileitis，therefore，truethat，byretainingthepresentmodeofproduction，butassumingthatthedifferentialrentispaidtothestate，pricesofagriculturalproductswould，everythingelsebeingequal，remainthesame，itisequallywrongtosaythatthevalueoftheproductswouldremainthesameifcapitalistproductionweresupersededbyassociation。Theidentityofthemarket-priceforcommoditiesofthesamekindisthemannerwherebythesocialcharacterofvalueassertsitselfonthebasisofcapitalistproductionand，ingeneral，anyproductionbasedontheexchangeofcommoditiesbetweenindividuals。Whatsocietyoverpaysforagriculturalproductsinitscapacityofconsumer，whatisaminusintherealisationofitslabour-timeinagriculturalproduction，isnowaplusforaportionofsociety，forthelandlords。
Asecondcircumstance，importantfortheanalysistobegivenunderIIofthenextchapter，isthefollowing:
Itisnotmerelyamatterofrentperacre，orperhectare，norgenerallyofadifferencebetweenthepriceofproductionandmarketprice，norbetweentheindividualandthegeneralpriceofproductionperacre，butitisalsoaquestionofhowmanyacresofeachtypeofsoilareundercultivation。Thepointofimportancehererelatesdirectlyonlytothemagnitudeoftherental，thatis，thetotalrentoftheentirecultivatedarea；butitservesusatthesametimeasastepping-stonetotheconsiderationofariseintherateo/rentalthoughthereisnoriseinprices，norincreaseinthedifferencesinrelativefertilityofthevarioustypesofsoilifpricesfall。
Wehadabove:
TABLEI
TypeofSoilAcresPriceofProductionProductRentinGrainRentinMoneyABCD1111£；3£；3£；3£；31qrs2qrs3qrs4qrs01qrs2qrs3qrs0£；3£；6£；9
Total……4acres10qrs6qrs£；18Nowletusassumethatthenumberofcultivatedacresisdoubledineverycategory。Wethenhave:
TABLEIaTypeofSoilAcresPriceofProductionProductRentinGrainRentinMoneyABCD2222£；6£；6£；6£；62qrs4qrs6qrs8qrs02qrs4qrs6qrs0£；6£；12£；18
Total……8acres20qrs12qrs£；36Letusassumetwomorecases。Supposeinthefirstcaseproductionexpandsonthetwopooresttypesofsoilinthefollowingmanner:
TABLEIbTypeofSoilAcresPriceofProductionProductRentinGrainRentinMoneyPerAcreTotalABCD4422£；3£；3£；3£；3£；3£；6£；15£；164qr8qrs6qrs8qrs04qrs4qrs6qrs£；0£；12£；12£；18
Total……12acres£；3626qrs14qrs£；42And，finally，letusassumeanunequalexpansionofproductionandcultivatedareaforthefoursoilcategories:
TABLEIcTypeofSoilAcresPriceofProductionProductRentinGrainRentinMoneyPerAcreTotalABCD1254£；3£；3£；3£；3£；3£；6£；15£；121qr4qrs15qrs16qrs02qrs10qrs12qrs£；0£；6£；30£；18
Total……12acres£；3636qrs24qrs£；72Inthefirstplace，therentperacreremainsthesameinallthesecases——I，Ia，lbandIc——for，infact，theresultofthesameinvestmentofcapitalperacreofthesamesoiltypehasremainedunchanged。Wehaveonlyassumedwhatistrueofanycountryatanygivenmoment；namely，thatvarioussoiltypesexistindefiniteratiostothetotalcultivatedarea。
Andwealsoassumedwhatisalwaystrueofanytwocountriesbeingcompared，orofthesamecountryatdifferentperiods，namely，thattheproportionsinwhichthetotalcultivatedareaisdistributedamongthedifferentsoiltypesvary。
IncomparingIawithIweseethatifthecultivationoflandinallfourcategoriesincreasesinthesameproportionadoublingofthecultivatedacreagedoublesthetotalproduction，andthatthesameappliestotherentingrainandmoney。
However，ifwecomparelbandthenIcwithI，weseethatinbothcasesatriplingoftheareaundercultivationoccurs。Itincreasesinbothcasesfrom4acresto12，butinlbclassesAandBcontributemosttotheincrease，withAyieldingnorentandByieldingthesmallestamountofdifferentialrent。Thus，outofthe8newlycultivatedacres，AandBaccountfor3each，i。e。，6together，whereasCandDaccountforIeach，i。e。，2together。Inotherwords，three-quartersoftheincreaseisaccountedforbyAandB，andonlyone-quarterbyCandD。Withthispremise，inlbcomparedwithIthetrebledareaofcultivationdoesnotresultinatrebledproduct，fortheproductdoesnotincreasefrom10to30，butonlyto26。Ontheotherhand，sinceaconsiderablepartoftheincreaseconcernsA，whichdoesnotyieldanyrent，andsincethemajorpartoftheincreaseonbettersoilsconcernsB，therentingrainrisesonlyfrom6to14quarters，andtherentinmoneyfrom£；18to£；42。
ButifwecompareIcwithI，wherethelandyieldingnorentdoesnotincreaseinareaandthelandyieldingaminimumrentincreasesbutslightly，whileCandDaccountforthemajorpartoftheincrease，wefindthatwhenthecultivatedareaistrebledproductionincreasesfrom10to36
quarters，i。e。，tomorethanthreetimesitsoriginalamount。Therentingrainincreasesfrom6to24quartersortofourtimesitsoriginalamount；andsimilarlymoney-rent，from£；18to£；72。
Inallthesecasesitisinthenatureofthingsthatthepriceoftheagriculturalproductremainsunchanged。Thetotalrentalincreasesinallcaseswiththeextensionofcultivation，unlessittakesplaceexclusivelyontheworstsoil，whichdoesnotyieldanyrent。Butthisincreasevaries。
Shouldthisextensioninvolvethebettersoiltypesandthetotaloutput，consequently，increasenotmerelyinproportiontotheexpansionofthearea，butrathermorerapidly，thentherentingrainandmoneyincreasestothesameextent。Shoulditbetheworstsoil，andthetypesofsoilclosetoit，thatareprincipallyinvolvedintheexpansionwherebyitisassumedthattheworstsoilrepresentsaconstanttype，thetotalrentaldoesnotincreaseinproportiontotheextensionofcultivation。Thus，giventwocountriesinwhichsoilA，yieldingnorent，isofthesamequality，therentalisinverselyproportionaltothealiquotpartrepresentedbytheworstsoilandtheinferiorsoiltypesinthetotalareaundercultivation，andthereforeinverselyproportionaltotheoutput，assumingequalcapitalinvestmentsonequaltotallandareas。Arelationshipbetweenthequantityoftheworstandthequantityofthebettercultivatedlandinthetotallandareaofagivencountrythushasanoppositeinfluenceonthetotalrentalthantherelationshipbetweenthequalityoftheworstcultivatedlandandthequalityofthebetterandbesthasontherentperacreand-othercircumstancesremainingthesame-onthetotalrental。Confusionbetweenthesetwopointshasgivenrisetoallkindsoferroneousobjectionsraisedagainstdifferentialrent。
Thetotalrental，then，increasesbythemereextensionofcultivation，andbytheconsequentgreaterinvestmentofcapitalandlabourintheland。
Butthemostimportantpointisthis:Althoughitisourassuniptionthattheratioofrentsperacreforthevariouskindsofsoilremainsthesame，andthereforealsotherateofrentconsideredwithreferencetocapitalinvestedineachacre，yetthefollowingistobeobserved:IfwecompareIawithI，thecaseinwhichthenumberofcultivatedacresandthecapitalinvestedinthemhavebeenproportionatelyincreased，wefindthatasthetotalproductionhasincreasedproportionatelytotheexpandedcultivatedarea，i。e。，asbothhavebeendoubled，sohastherental。Ithasrisenfrom£；18to£；36，justasthenumberofacreshasrisenfrom4to8。
Ifwetakethetotalareaof4acres，wefindthatthetotalrentalamountedto£；18andthustheaveragerent，includingthelandwhichdoesnotyieldanyrent，is£；4112。Suchacalculationmightbemade，say，byalandlordowningall4acres；andinthiswaytheaveragerentisstatisticallycomputedforawholecountry。Thetotalrentalof£；18
isobtainedbytheinvestmentofacapitalof£；10。Wecalltheratioofthesetwofigurestherateofrent；inthepresentcaseitistherefore180%。
ThesamerateofrentobtainsinIa，where8insteadof4acresarecultivated，butalltypesoflandhavecontributedtotheincreaseinthesameproportion。Thetotalrentalof£；36yieldsfor8acresandaninvestedcapitalof£；20anaveragerentof£；4112peracreandarateofrentof180%。
Butifweconsiderlb，wheretheincreasehastakenplacemainlyupontwoinferiorcategoriesofsoil，weobtainarentof£；42for12acres，oranaveragerentof£；3112peracre。Thetotalinvestedcapitalis£；30，andthereforetherateof’rent=140%。Theaveragerentperacrehasthusdecreasedby£；1，andtherateofrenthasfallenfrom180to140%。Herethenwehaveariseinthetotalrentalfrom£；18to£；42，butadropinaveragerentcalculatedperacreaswellasonthebasisofcapital；thedroptakesplaceparalleltoanincreaseinproduction，butnotproportionately。Thisoccurseventhoughtherentforalltypesofsoil，calculatedperacreaswellasonthebasisofcapitaloutlay，remainsthesame。Thisoccursbecausethree-quartersoftheincreaseisaccountedforbysoilA，whichdoesnotyieldanyrent，andsoilB，whichyieldsonlyminimumrent。
IfthetotalexpansioninCaselbhadtakenplacesolelyonsoilA，weshouldhave9acresonA，IacreonB，IacreonCandIacreonD。Thetotalrentalwouldbe£；18，thesameasbefore；theaveragerentforthe12acresthereforewouldbe£；1112peracre；andarentof£；18onaninvestedcapitalof£；30wouldgivearateofrentof60%。Theaveragerent，calculatedperacreaswellasonthebasisofinvestedcapital，wouldhavegreatlydecreased，whilethetotalrentalwouldnothaveincreased。
Finally，letuscompareIcwithIandIb。ComparedwithI，theareahasbeentrebled，andalsotheinvestedcapital。Thetotalrentalis£；72for12acres，or£；6peracre-asagainst£；4112
inCaseI。Therateofrentontheinvestedcapital£；72:£；30
is240%insteadof180%。Thetotaloutputhasrisenfrom10to36quarters。
Comparedwithlb，wherethetotalnumberofcultivatedacres，theinvestedcapital，andthedifferencesbetweenthecultivatedsoiltypesarethesame，butthedistributiondifferent，theoutputis36quartersinsteadof26quarters，theaveragerentperacreis£；6insteadof£；3112，andtherateofrentwithreferencetothesameinvestedtotalcapitalis240%insteadof140%。
NomatterwhetherweregardthevariousconditionsintablesIa，lbandIcasexistingsimultaneouslysidebysideindifferentcountries，orasexistingsuccessivelyinthesamecountry，wecometothefollowingconclusions:Solongasthepriceofgrainremainsunchangedbecausetheyieldontheworst，rentlesssoilremainsthesame；solongasthedifferenceinthefertilityofthevariouscultivatedtypesofsoilremainsthesame；
solongastherespectiveoutputsremainthesame，hence，givenequalcapitalinvestmentsonequalaliquotpartsacresofcultivatedareaineverytypeofsoil；solongastheratio，therefore，betweentherentsperacreoneachcategoryofsoilisconstant，andtherateofrentonthecapitalinvestedineachplotofthesamekindofsoilisconstant:First，therentalconstantlyincreaseswiththeextensionofcultivatedareaandwiththeconsequentincreasedcapitalinvestment，exceptforthecasewheretheentireincreaseisaccountedforbyrentlessland。Secondly，theaveragerentperacretotalrentaldividedbythetotalnumberofcultivatedacres
aswellastheaveragerateofrenttotalrentaldividedbytheinvestedtotalcapitalmayvaryveryconsiderably；and，indeed，bothchangeinthesamedirection，butindifferentproportionstoeachother。IfweleaveoutofconsiderationthecaseinwhichtheexpansiontakesplaceonlyontherentlesssoilA，wefindthattheaveragerentperacreandtheaveragerateofrentonthecapitalinvestedinagriculturedependontheproportionswhichthevariousclassesofsoilconstituteinthetotalcultivatedarea；
or，whatamountstothesamething，onthedistributionofthetotalemployedcapitalamongthekindsofsoilofvaryingfertility。Whethermuchorlittlelandiscultivated，andwhetherthetotalrentalisthereforelargerorsmallerwiththeexceptionofthecaseinwhichtheexpansionisconfinedtoA，theaveragerentperacre，ortheaveragerateofrentoninvestedcapital，remainsthesameaslongastheproportionsofthevariouscategoriesofsoilinthetotalcultivatedarearemainunchanged。Inspiteofanincrease，evenaveryconsiderableone，inthetotalrentalwiththeextensionofcultivationandexpansionofcapitalinvestment，theaveragerentperacreandtheaveragerateofrentoncapitaldecreasewhentheextensionofrentlessland，andlandyieldingonlylittledifferentialrent，isgreaterthantheextensionofthesuperioroneyieldinggreaterrent。Conversely，theaveragerentperacreandtheaveragerateofrentoncapitalincreaseproportionatelytotheextentthatbetterlandconstitutesarelativelygreaterpartofthetotalareaandthereforeemploysarelativelygreatershareoftheinvestedcapital。
Hence，ifweconsidertheaveragerentperacre，orhectare，ofthetotalcultivatedlandasisgenerallydoneinstatisticalworks，incomparingeitherdifferentcountriesinthesameperiod，ordifferentperiodsinthesamecountry，wefindthattheaveragelevelofrentperacre，andconsequentlytotalrental，correspondstoacertainextentalthoughbynomeansidentical，butratheramorerapidlyincreasingextenttotheabsolute，nottotherelative，fertilityofthesoilinagivencountry；
thatis，totheaverageamountofproducewhichityieldsfromthesamearea。Forthelargertheshareofsuperiorsoilsinthetotalcultivatedarea，thegreatertheoutputforequalcapitalinvestmentsonequallylargeareasofland；andthehighertheaveragerentperacre。Inthereversecasetheoppositetakesplace。Thus，rentdoesnotappeartobedeterminedbytheratioofdifferentialfertility，butbytheabsolutefertility，andthelawofdifferentialrentappearsinvalid。Forthisreasoncertainphenomenaaredisputed，oranattemptismadetoexplainthembynon-existingdifferencesinaveragepricesofgrainandinthedifferentialfertilityofcultivatedland，whereassuchphenomenaaremerelyduetothefactthattheratiooftotalrentaltototalareaofcultivatedlandortototalcapitalinvestedintheland-aslongasthefertilityoftherentlesssoilremainsthesameandthereforethepricesofproduction，andthedifferencesbetweenthevariouskindsofsoilremainunchanged-isdeterminednotmerelybytherentperacreortherateofrentoncapital，butquiteasmuchbytherelativenumberofacresofeachtypeofsoilinthetotalnumberofcultivatedacres；or，whatamountstothesamething，bythedistributionofthetotalinvestedcapitalamongthevarioustypesofsoil。Curiouslyenough，thisfacthasbeencompletelyoverlookedthusfar。Atanyrate，weseeandthisisimportantforourfurtheranalysisthattherelativeleveloftheaveragerentperacre，andtheaveragerateofrentortheratioofthetotalrentaltothetotalcapitalinvestedintheland，mayriseorfallbymerelyextensivelyexpandingcultivation，aslongaspricesremainthesame，thedifferentialfertilitiesofthevarioussoilsremainunaltered，andtherentperacre，orrateofrentforcapitalinvestedperacreineverytypeofsoilactuallyyieldingrent，i。e。，forallcapitalactuallyyieldingrent，remainsunchanged。
ItisnecessarytomakethefollowingadditionalpointswithreferencetotheformofdifferentialrentconsideredunderheadingI；theyalsoapplyinparttodifferentialrentII:
First，itwasseenthattheaveragerentperacre，ortheaveragerateofrentoncapital，mayincreasewithanextensionofcultivationwhenpricesarestationaryandthedifferentialfertilityofthecultivatedplotsoflandremainsunaltered。Assoonasallthelandinagivencountryhasbeenappropriated，andinvestmentsofcapitalinland，cultivation，andpopulationhavereachedadefinitelevel-allgivenconditionsassoonasthecapitalistmodeofproductionbecomestheprevailingoneandalsoencompassesagriculture-thepriceofuncultivatedlandofvaryingqualitymerelyassumingdifferentialrenttoexistisdeterminedbythepriceofthecultivatedplotsoflandofthesamequalityandequivalentlocation。
Thepriceisthesame-afterdeductingthecostofbringingthenewlandintocultivation-eventhoughthislanddoesnotyieldanyrent。Thepriceofthelandis，indeed，nothingbutthecapitalisedrent。Buteveninthecaseofcultivatedland，thepricepaysonlyforfuturerents，as，forinstance，whentheprevalentinterestrateis5%andtherentfortwentyyearsispaidatonetimeinadvance。Whenlandissold，itissoldaslandyieldingrent，andtheprospectivecharacteroftherentwhichishereconsideredasaproductofthesoil，butitonlyseemstobethat
doesnotdistinguishtheuncultivatedfromthecultivatedland。Thepriceoftheuncultivatedland，likeitsrentthepriceofwhichrepresentsthecontractedformofthelatterisquiteillusoryaslongasthelandisnotactuallyused。Butitisthusdeterminedaprioriandisrealisedassoonasapurchaserisfound。Hence，whiletheactualaveragerentinagivencountryisdeterminedbyitsactualaverageannualrentalandtherelationofthelattertothetotalcultivatedarea，thepriceoftheuncultivatedlandisdeterminedbythepriceofthecultivatedland，andisthereforebutareflectionofthecapitalinvestedinthecultivatedlandandtheresultsobtainedtherefrom。Sincealllandwiththeexceptionoftheworstyieldsrentandthisrent，asweshallseeundertheheadofdifferentialrentII，increaseswiththequantityofcapitalandcorrespondingintensityofcultivation，thenominalpriceofuncultivatedplotsoflandisthusformed，andtheythusbecomecommodities，asourceofwealthfortheirowners。Thisexplainsatthesametime，whythepriceoflandincreasesinawholeregion，evenintheuncultivatedpartOpdyke。Landspeculation，forinstance，intheUnitedStates，isbasedsolelyonthisreflectionthrownbycapitalandlabouronuncultivatedland。
Secondly，progressinextendingcultivatedlandgenerallytakesplaceeithertowardinferiorsoiloronthevariousgiventypesofsoilinvaryingproportions，dependingonthemannerinwhichtheyaremet。Extensiononinferiorsoilisnaturallynevermadevoluntarily，butcanonlyresultfromrisingprices，assumingacapitalistmodeofproduction，andcanonlyresultfromnecessityunderanyothermodeofproduction。However，thisisnotabsolutelyso。Poorsoilmaybepreferredtoarelativelybettersoilonaccountoflocation，whichisofdecisiveimportanceforeveryextensionofcultivationinyoungcountries；furthermore，eventhoughthesoilformationinacertainregionmaygenerallybeclassifiedasfertile，itmayneverthelessconsistofamotleyconfusionofbetterandworsesoils，sothattheinferiorsoilmayhavetobecultivatedifonlybecauseitisfoundintheimmediatevicinityofthesuperiorsoil。Ifinferiorsoilissurroundedbysuperiorsoil，thenthelattergivesittheadvantageoflocationincomparisonwithmorefertilesoilwhichisnotyet，orisabouttobecome，partofthecultivatedarea。
Thus，theStateofMichiganwasoneofthefirstWesternStatestobecomeanexporterofgrain。YetitsSoilonthewholeispoor。ButitsproximitytotheStateofNewYorkanditswater-waysviatheLakesandErieCanalinitiallygaveittheadvantageovertheStatesendowedbyNaturewithmorefertilesoil，butsituatedfarthertotheWest。TheexampleofthisState，ascomparedwiththeStateofNewYork，alsodemonstratesthetransitionfromsuperiortoinferiorsoil。ThesoiloftheStateofNewYork，particularlyitswesternpart，isincomparablymorefertile，especiallyforthecultivationofwheat。Thisfertilesoilwastransformedintoinfertilesoilbyrapaciousmethodsofcultivation，andnowthesoilofMichiganappearedasthemorefertile。”In1838，wheatenflourwasshippedatBuffalofortheWest；
andthewheat-regionofNewYork，withthatofUpperCanada，werethemainsourcesofitssupply。Now，afteronlytwelveyears，anenormoussupplyofwheatandflourisbroughtfromtheWest，alongLakeErie，andshippedupontheErieCanalfortheEast，atBuffaloandtheadjoiningportofBlackrock……TheeffectoftheselargearrivalsfromtheWesternStates-whichwereunnaturallystimulatedduringtheyearsofEuropeanfamine……hasbeentorenderwheatlessvaluableinwesternNewYork，tomakethewheatculturelessremunerative，andtoturntheattentionoftheNewYorkfarmersmoretograzinganddairyhusbandry，fruitculture，andotherbranchesofruraleconomy，inwhichtheythinktheNorth-Westwillbeunablesodirectlytocompetewiththem。”I。W。Johnston，NotesonNorthAmerica，London，1851，I，pp。220-23。
Thirdly，itisamistakenassumptionthatthelandincoloniesand，ingeneral，inyoungcountrieswhichcanexportgrainatcheaperprices，mustofnecessitybeofgreaternaturalfertility。Thegrainisnotonlysoldbelowitsvalueinsuchcases，butbelowitspriceofproduction，i。e。，belowthepriceofproductiondeterminedbytheaveragerateofprofitintheoldercountries。
Thefactthatwe，asJohnstonsaysp。223，”areaccustomedtoattachtheideaofgreatnaturalproductivenessandofboundlesstractsofrichland，tothosenewStatesfromwhichcomethelargesuppliesofwheatthatareannuallypouredintotheportofBuffalo，”isprimarilytheresultofeconomicconditions。TheentirepopulationofsuchanareaasMichigan，forinstance，isatfirstalmostexclusivelyengagedinfarming，andparticularlyinproducingagriculturalmassproducts，whichalonecanbeexchangedforindustrialproductsandtropicalgoods。Itsentiresurplusproductionappears，therefore，intheformofgrain。Thisfromtheoutsetsetsapartthecolonialstatesfoundedonthebasisofthemodernworld-marketfromthoseofearlier，particularlyancient，times。Theyreceivethroughtheworld-marketfinishedproducts，suchasclothingandtoolswhichtheywouldhavetoproducethemselvesunderothercircumstances。OnlyonsuchabasisweretheSouthernStatesoftheUnionenabledtomakecottontheirstaplecrop。Thedivisionoflabourontheworld-marketmakesthispossible。Hence，iftheyseemtohavealargesurplusproductionconsideringtheiryouthandrelativelysmallpopulation，thisisnotsomuchduetothefertilityoftheirsoil，northefruitfijlnessoftheirlabour，butrathertotheone-sidedformoftheirlabour，andthereforeofthesurplus-produceinwhichsuchlabourisincorporated。