（2。iii。31）Itisequallyeasy，inthismodeofexpressionasintheformer，totranslatethe
　　language
　　ofsharesintothatofpercentage。Theamountoftheproduce，oritsexchangeablevalue，maybe
　　greater，ormaybeless，thantheamountofcapitalemployed。Ifthecapitalisallcirculating
　　capital，andconsumedintheprocessofproduction，andif，asinordinarylanguage，wesuppose
　　wagestobeincluded，theproduceisgreaterthanthecapital，bytheamountoftheprofits。Letus
　　supposethatthecapitalis500l。，andprofits10percent；thevalueoftheproduceis550l。；letus
　　supposethatofthisthecapitalistpays275l。inwages；inotherwords，thatthelabourers’shareis
　　50percent；itfollows，thattheshareofthecapitalistis50percentalso；but50percentof550l。
　　isagreateramountthan50percentofhiscapital，whichisonly500l。Thisisequalto55per
　　centuponhiscapital。Andwhenhehasdeductedfromhisshare，whatisnecessarytoreplacethe
　　portionofhiscapital，otherwiseconsumedthaninthepaymentofwages，viz。500l。—275l。=
　　225l。，hehas50l。remaining，or10percentuponhiscapital。
　　（2。iii。32）Letusnexttakethecaseinwhichthecapital500l。，asbefore，isallfixedcapital，
　　none
　　ofit，exceptingwhatisadvancedaswages，consumed；thatthisissmall，viz。25l。；andthatthe
　　valueofthecommodityis75l。；ofthis，25l。，or1/3istheshareofthelabourer；50l。，or2/3，is
　　theshareofthecapitalist；butthis，though66—1/2percentupontheproduct，isbut10percent
　　uponthecapital。
　　（2。iii。33）Thereisamodeofviewingthegrossreturntothecapitalist，whichhasatendency
　　to
　　simplifyourlanguage，and，sofar，hasagreatadvantagetorecommendit。Thecaseoffixedand
　　ofcirculatingcapitalmaybetreatedasthesame，bymerelyconsideringthefixedcapitalasa
　　product，whichisregularlyconsumedandreplaced，byeverycourseofproductiveoperations。
　　Thecapital，notconsumed，maybealwaystaken，asanadditionalcommodity，theresultofthe
　　productiveprocess。
　　（2。iii。34）Accordingtothissupposition，theshareofthecapitalistisalwaysequaltothe
　　wholeor
　　hiscapital，togetherwithitsprofits。
　　（2。iii。35）Wemayconsidercapitalintwosenses；first，asincluding；next，asexcluding，
　　wages。
　　（2。iii。36）Inthefirstcase，letussupposeacapital，of500l。，ofwhich100l。ispaidinwages，
　　to
　　produceacommodityworth550l。Theshareofthecapitalistis450l。orsomewhatmorethan
　　four—fifths，whilethatofthelabourersissomuchlessthanone—fifthandtheprofitofstock，after
　　replacingcapital，is10percent。
　　（2。iii。37）Letussuppose，inthesecondcase，acapitalor400l。，butexclusiveofwages。This
　　capitalisemployed，andthenecessarylabourersmaintainthemselveswithoutwages，andtake，
　　astheirremuneration，theirshareofthecommoditywhenproduced。Thecommodityisworth
　　550l。；andofthat100l。fallstotheshareofthelabourers。Therateofprofitsisthesameas
　　before，andtheproportionsarethesameasbefore，onlywiththiscorrection，thatintheformer
　　casethelabourerssustainedadiscountor10percentupontheirshareonaccountofanticipated
　　paymentTherealsharesinbothcasesarefour—fifthstothecapitalist，andone—fifthtothe
　　workmen。
　　（2。iii。38）Itissufficientlyevidentthat，solongasthecapitalandthelabourremainthesame，
　　and
　　thesharesremainthesame，solong，inMr。Ricardo’ssenseofthewordvalue，willthesame
　　valueaccruetoeach，whetherthequantityofproducetheyreceivebegreaterorless。
　　（2。iii。39）Thatthecapital，andthelabour，shouldremainthesame，isasnecessarya
　　condition，as
　　thatthesharesshouldremainthesame；forifeitherisincreasedordiminished，thevalueofthe
　　product，inMr。Ricardo’ssenseofthewordvalue，isalsoincreasedordiminished。
　　（2。iii。40）Thequantityofproducebeingsupposedthesame，wemayillustratethesubjectby
　　the
　　followingcases。
　　（2。iii。41）1。Letussupposethatbothcapitalandlabourarediminished，andinequal
　　proportions。
　　Thisispreciselythesamewiththecaseinwhichtheproductivepowersoflabourandcapitalare
　　increased；asitcomestothesamething，whetheryouhavethesameproducefromalesscostof
　　production，oragreaterproducefromthesamecostofproduction。Thiscase，therefore，hasbeen
　　alreadyconsidered。
　　（2。iii。42）2。Letussuppose，thatthecapitalisdiminished，thelabournot。Thisalsoisacase
　　of
　　diminishedcostofproduction。If，fortheproduceof550yardsofcloth，whichwasatfirst
　　effectedbyacapitalof400yardsandaportionoflabourwhichwaspaidbyafifthofthe
　　produce，onlyacapitalof200yardsshouldberequired，butthesamequantityofimmediate
　　labour；thatthelabourersmayhavethesameshareasbefore，itisnecessarythattheyshould
　　haveagreateraliquotpart。Suppose，beforethatincreaseofproductivepowerwhichissupposed
　　inthiscase，whenacapitalof400yardswasrequiredforaproduceof550，andwhenthewages
　　ofthequantityoflabourappliedwas110yards，thatanothercommodityhadbeenproducedby
　　thesamequantityorlabour，butbyacapitalof200yards。Thevalueofthiscommoditywould
　　havebeen330yards，equaltothecapitalwithitsprofitsandthewages。Ofthisthelabourers
　　wouldhavereceived110yards，orone—third。Thisisthesameproportiontoacapitalof200
　　yards，asone—fifthistoacapitalof400yards。Ifthelabourcontributedone—fifthtotheproduct
　　of550yards，whenaidedbyacapitalof400yards，itcontributesone—third，inthenewly
　　supposedcase，whenaidedbyacapitalof200yards。One—thirdof550is1831/3；leavingtothe
　　capitalist366—2/3，oraprofituponhiscapitalof83—1/3percent。Accordingtotheexplanation，
　　whichwehavealreadygivenandrepeated，thereishereanadditionalproducetoeach，byreason
　　oftheincreaseofproductivepower；and，also，whichisonlythesamethinginotherwords，an
　　augmentedvalueinexchange。ButinMr。Ricardo’ssenseofthewordvalue，thereisonlythe
　　samevaluetoeach，solongastheproportionsremainunchanged。
　　（2。iii。43）ThecaseswhichIhavethusputforillustration，arecasesinwhichtheproductive
　　powersoflabourandcapitalareaugmented；butasthesamereasoningsapply，mutatismutandis，
　　tothecasesinwhichtheproductivepowersarediminished，itisdeemedunnecessarytolengthen
　　thisanalysisbyadducingthem。
　　（2。iii。44）Itmayherebeusefultothelearnertolookback，andascertainthenumberand
　　importanceofthestepswhichhehasadvanced。Hehasdiscovered，whatarethelaws，according
　　towhichthosecommodities，whichformtherichesofnations，areproduced；andwhatarethe
　　laws，accordingtowhich，whenproduced，theyaredistributed。
　　（2。iii。45）Hehasseenthattherearetwoinstrumentsofproduction；oneprimary，theother
　　secondary：thatlabouristheprimaryinstrumentofproduction，andthat，abstractedfromthose
　　aidswhichitderivesfromcapital，itsproductivepowersareaugmentedchieflybylimitingthe
　　numberofeachman’sproductiveoperations；inotherwords，bywhathasbeencalledthe
　　divisionoflabour：thatcapitalissecondarytolabour，notonlybecauseitissubsequentinorder
　　oftime，butbecauseitowesitsexistencetolabour；becausethefirstcapitalistheresultofpure
　　labour，andbecausethatwhichissubsequentlytheresultoflabourandcapitalcombined，may
　　thenceberesolvedintolabour，theultimateprincipleofallproduction。
　　（2。iii。46）Thelearnerhasnowalsoseen，that，whatisproduced，bytheoperationsoflabour
　　and
　　capital，dividesitself，inthefirstinstance，intothreeportions；therentofland；thewagesof
　　labour；andtheprofitsofstock。Tillthelawswerediscovered，whichdeterminetheboundaries
　　oftheseseveralportions，thatwhichgoesasrent，thatwhichgoesasprofits，andthatwhichgoes
　　aswages，almostalltheconclusionsofPoliticalEconomywerevagueanduncertain。Ithasbeen
　　seen，thatrentissomethingwhichmaybeconsideredindependentofthegeneralresultorthe
　　productivepowersoflabourandcapital；thatitistheresultofapeculiardefectoftheearth，
　　whichdoesnotcontinuetoyielditsproduceinequalabundancetosuccessiveportionsof
　　capital；andthatitistheexcessofwhatisyieldedtothemoreproductiveportions，abovewhatis
　　equaltotheproduceoftheleastproductiveportionofcapitalemployedupontheland。Afterthe
　　limitswerethusfixedofthisoneofthethreeportions，intowhichtheproduceofindustry
　　dividesitself，whenceitappearedthatwhatmayberegardedasthegenuineeffectoflabourand
　　capitalinco—operationislefttobedividedbetweenthelabourerandthecapitalist；itwaseasy
　　forthelearnertosee，that，inrespecttoproportions，aswhatfelltotheshareoftheonewas
　　increased，whatwenttotheshareoftheotherwasdiminished，andthatinthissense，wagesand
　　profitsdependononeanother；thatinrespect，however，tothequantityofproducewhichthese
　　sharesmaycontain，theproductivepoweroftheinstrumentsofproductionisthedetermining
　　cause。
　　Chapter3。InterchangeSectionI。NatureoftheAdvantageDerivedfromthe
　　InterchangeofCommodities，andthePrincipalAgentsEmployedinit。
　　（3。i。1）Whentwomenhavemorethantheyneed；one，forexample，offood；another，of
　　cloth；
　　whilethefirstdesiresmoreofcloththanhepossesses，thesecondmoreoffood；itisagreat
　　accommodationtoboth，iftheycanperformanexchangeofapartofthefoodoftheonefora
　　partoftheclothoftheother；andsoinothercases。
　　（3。i。2）Inperformingexchanges，therearetwosetsofpersons，theinterventionofwhomisof
　　greatadvantage：thefirstareCarriers，thesecondMerchants。
　　（3。i。3）Whenthedivisionanddistributionoflabourhasbeencarriedtoanyconsiderable
　　extent，
　　goodsareproducedatsome，oftenataveryconsiderable，distancefromtheplacewheretheyare
　　wantedforconsumption。Itisnecessarythattheyshouldbeconveyedfromtheoneplacetothe
　　other。Carriersareoftwosorts：CarriersbyLand，andCarriersbyWater。Forthebusinessof
　　carriage，bothcapitalandlabourarerequired。Incarriagebyland，thewaggonsorcarts，the
　　horsesorothercattle，andthemaintenancebothofthemandofthenecessarynumberofmen；in
　　carriagebywater，theships，andthemaintenanceofthemenwhonavigatethem，constitutethe
　　capitalrequired。
　　（3。i。4）Toprocurearticles，asmenhaveoccasiontoconsumethem，itwouldbevery
　　inconvenienttorepair，ineachinstance，totherespectivemanufacturersandproducers，whomay
　　oftenliveataveryconsiderabledistancefromoneanother。Greattroubleissavedtoconsumers，
　　whentheyfindassembledinoneplacethewhole，oranyconsiderableportion，ofthearticles
　　whichtheyuse。Thisconveniencegivesrisetotheclassofmerchants，whobuyfromthe
　　manufacturers，andkeepreadyforuse，allthosearticlesforwhichtheyexpectaprofitablesale。
　　（3。i。5）Insmalltowns，whereoneorafewmerchantscansupplythewantsofallthe
　　population，
　　theshoporstoreofonemerchantcontainsarticlesofall，ormostofthekinds，ingeneral
　　demand。Inplaceswherethepopulationislarge，insteadofagreatnumberofshops，each
　　dealinginalmostallkindsofarticles，itisfoundmoreconvenienttodividethearticlesinto
　　classes，andthateachshopshouldconfineitselftoaparticularclass：one，forexample，tohats，
　　anothertohosiery；onetoglass，anothertoiron；andsoon。
　　SectionII。WhatDeterminestheQuantityinWhich
　　CommoditiesExchangeforOneAnother（3。ii。1）Whenacertainquantityofonecommodityisexchangedforacertainquantityof
　　another
　　commodity；acertainquantityofcloth，forexample，foracertainquantityofcorn；thereis
　　somethingwhichdeterminestheowneroftheclothtoacceptforitsuchandsuchaquantityof
　　corn；and，inlikemanner，theownerofthecorntoacceptsuchandsuchaquantityofcloth。
　　（3。ii。2）Thisis，evidently，theprincipleofdemandandsupply，inthefirstinstance。Ifagreat
　　quantityofcorncomestomarkettobeexchangedforcloth，andonlyasmallquantityofclothto
　　beexchangedforcorn，agreatquantityofcornwillbegivenforasmallquantityofcloth。Ifthe
　　quantityofcloth，whichthuscomestomarket，isincreased，withoutanyincreaseinthequantity
　　ofcorn，thequantityofcornwhichisexchangedforagivenquantityofclothwillbe
　　proportionallydiminished。
　　（3。ii。3）Thisanswer，however，doesnotresolvethewholeofthequestion。Thequantityin
　　which
　　commoditiesexchangeforoneanotherdependsupontheproportionofsupplytodemand。Itis
　　evidentlythereforenecessarytoascertainuponwhatthatproportiondepends。Whatarethelaws
　　accordingtowhichsupplyisfurnishedtodemand，isoneofthemostimportantinquiriesin
　　PoliticalEconomy。
　　（3。ii。4）Demandcreates，andthelossofdemandannihilates，supply。Whenanincreased
　　demand
　　arisesforanycommodity，anincreaseofsupply，ifthesupplyiscapableofincrease，follows，as
　　aregulareffect。Ifthedemandforanycommodityaltogetherceases，thecommodityisnolonger
　　produced。
　　（3。ii。5）Theconnexionhere，orcausesandeffects，iseasilyexplained。Ifcornisbroughtto
　　market，thecostofbringingithasbeensomuch。Ifclothisbroughttomarket，thecostof
　　bringingithasbeensomuch。Forthebenefitofsimplicity，thenumberofcommoditiesinthe
　　marketisheresupposedtobetwo：itisofnoconsequence，withregardtotheresult，whether
　　theyareunderstoodtobefewormany。
　　（3。ii。6）Thecostofbringingthecorntomarkethasbeeneitherequaltothatofbringingthe
　　cloth，
　　orunequal。Ifithasbeenequal，thereisnomotive，tothosewhobringtheclothorthecorn，for
　　alteringthequantityofeither。Theycannotobtainmoreofthecommoditywhichtheyreceivein
　　exchange，bytransferringtheirlabourtoitsproduction。Ifthecosthasbeenunequal，there
　　immediatelyarisesamotiveforalteringtheproportions。Supposethatthecostofbringing，the
　　wholeofthecornhasbeengreaterthanthatofbringingthewholeofthecloth；andthatthe
　　wholeoftheoneisexchangedagainstthewholeoftheother，eitheratonce，orinparts：the
　　personswhobroughttheclothhaveinthatcasepossessedthemselvesofaquantityofcornat
　　lesscost，thanthatatwhichitwasbroughttomarket，bythosewhoproducedit；those，onthe
　　otherhand，whobroughtthecornhavepossessedthemselvesofaquantityofcloth，atagreater
　　costthanthatatwhichitcanbemadeandbroughttomarket。
　　（3。ii。7）Heremotivesarise，todiminishthequantityofcorn，andincreasethequantityof
　　cloth；
　　becausethemenwhohavebeenproducingcorn，andpurchasingcloth，canobtainmorecloth，by
　　transferringtheirmeansofproductionfromtheonetotheother。Assoon，again，asnomore
　　clothcanbeobtainedbyapplyingthesameamountofmeanstotheproductionofcloth，thanby
　　applyingthemtocorn，andexchangingitforcloth，allmotivetoalterthequantityoftheoneas
　　comparedwiththatoftheotherisatanend。Nothingistobegainedbyproducingcornrather
　　thancloth，orclothratherthancorn。Thecostofproductiononbothsidesisequal。
　　（3。ii。8）Itthusappearsthattherelativevalueofcommodities，orinotherwords，thequantity
　　of
　　onewhichexchangesforagivenquantityofanother，dependsupondemandandsupply，inthe
　　firstinstance；butuponcostofproduction，ultimately；andhence，inaccuratelanguage，upon
　　costofproduction，entirely。Anincreaseordiminutionofdemandorsupply，maytemporarily
　　increaseordiminish，beyondthepointofproductivecost，thequantityofonecommoditywhich
　　exchangesforagivenquantityofanother；butthelawofcompetition，whereveritisnot
　　obstructed，tendsinvariablytobringittothatpoint，andtokeepitthere。
　　（3。ii。9）Costofproduction，then，regulatestheexchangeablevalueofcommodities。Butcost
　　of
　　productionisitselfinvolvedinsomeobscurity。
　　（3。ii。10）Twoinstrumentsarecommonlycombinedinproduction；LabourandCapital。
　　（3。ii。11）Itfollows，eitherthatcostofproductionconsistsinlabourandcapitalcombined；or
　　that
　　oneofthesemayberesolvedintotheother。Ifoneofthemcanberesolvedintotheother，it
　　followsthatcostofproductiondoesnotconsistinbothcombined。
　　（3。ii。12）Theopinion，whichissuggestedbyfirstappearances，undoubtedlyis，thatcostof
　　productionconsistsincapitalalone。Thecapitalistpaysthewagesofhislabourer，buystheraw
　　material，andexpectsthatwhathehasexpendedshallbereturnedtohim，intheprice，withthe
　　ordinaryprofitsuponthewholeofthecapitalemployed。Fromthisviewofthesubject，itwould
　　appear，thatcostofproductionconsistsexclusivelyintheportionofcapitalexpended，together
　　withtheprofitsuponthewholeofthecapitalemployedineffectingtheproduction。
　　（3。ii。13）Itiseasy，however，tosee，thatinthetermcapital，thusunderstood，anambiguity，
　　and
　　henceafallacy，isinvolved。Whenwesaythatcapitalandlabour，thetwoinstrumentsof
　　production，belongtotwoclassesofpersons；wemeanthatthelabourershavecontributedso
　　muchtotheproduction，andthecapitalistssomuch；andthatthecommodity，whenproduced，
　　belongsincertainproportionstoboth。Itmaysohappen，however，thatoneofthesepartieshas
　　purchasedtheshareoftheother，beforetheproductioniscompleted。Inthatcase，thewholeof
　　thecommoditybelongstothepartywhohaspurchasedtheshareoftheother。Inpointoffact，it
　　doeshappen，thatthecapitalist，asoftenasheemployslabourers，bythepaymentofwages，
　　purchasestheshareofthelabourers。Whenthelabourersreceivewagesfortheirlabour，without
　　waitingtobepaidbyashareofthecommodityproduced，itisevidentthattheyselltheirtitleto
　　thatshare。Thecapitalististhentheowner，notofthecapitalonly，butofthelabouralso。Ifwhat
　　ispaidaswagesisincluded，asitcommonlyis，inthetermcapital，itisabsurdtotalkoflabour
　　separatelyfromcapital。Thewordcapital，asthusemployed，includeslabourandcapitalboth。To
　　say，therefore，thattheexchangeablevalueofcommoditiesisdeterminedbycapital，understood
　　inthissense，istosaythatitisdeterminedbylabourandcapitalcombined。This，however，is
　　returningtothepointfromwhichwesetout。Itisnugatorytoincludelabourinthedefinitionof
　　thewordcapital，andthentosaythat，capitalwithoutlabour，determinesexchangeablevalue。If
　　capitalisunderstoodinasensewhichdoesnotincludethepurchasemoneyoflabour，andhence
　　thelabouritself，itisobviousthatcapitaldoesnotregulatetheexchangeablevalueof
　　commodities。
　　（3。ii。14）Iflabourwerethesoleinstrumentofproduction，andcapitalnotrequired，the
　　produce
　　ofoneday’slabourinonecommoditywouldexchangeagainsttheproduceofoneday’slabourin
　　anothercommodity。Intherudestateofsociety，ifthehunterandthefishermandesiredtovary
　　theirfood，theonebyaportionofgame，theotherbyaportionoffish，theaveragequantity
　　whichtheytookinadaywouldformthestandardofexchange。Ifitdidnot，oneofthetwo
　　wouldbeplacedinamoreunfavourablesituationthanhisneighbour，withperfectpower，which
　　hewouldofcourseemploy，topassfromtheonesituationtotheother。
　　（3。ii。15）Inestimatingequalquantitiesoflabour，anallowancewould，ofcourse，beincluded
　　for
　　differentdegreesofhardnessandskill。Iftheproductsofeachoftwodays’labourofequal
　　hardnessandskillexchangedforoneanother，theproductofaday’slabour，whichwaseither
　　harder，orrequiredagreaterdegreeofskill，wouldexchangeforsomethingmore。
　　（3。ii。16）Allcapitalconsistsreallyincommodities。Thecapitalofthefarmerisnotthe
　　money
　　whichhemaybeworth，becausethathecannotapplytoproduction。Hiscapitalconsistsinhis
　　implementsandstock。
　　（3。ii。17）Asallcapitalconsistsincommodities，itfollows，ofcourse，thatthefirstcapital
　　must
　　havebeentheresultofpurelabour。Thefirstcommoditiescouldnotbemadebyany
　　commoditiesexistingbeforethem。
　　（3。ii。18）Butifthefirstcommodities，andofcoursethefirstcapital，weretheresultof’pure
　　labour，thevalueofthiscapital，thequantityofothercommoditiesforwhichitwouldexchange，
　　musthavebeenestimatedbylabour。Thisisanimmediateconsequenceofthepropositionwhich
　　wehavejustestablished，thatwherelabourwasthesoleinstrumentofproduction，exchangeable
　　valuewasdeterminedbythequantityoflabourwhichtheproductionofthecommodityrequired。
　　（3。ii。19）Ifthisbeestablished，itisanecessaryconsequence，thattheexchangeablevalueof
　　all
　　commoditiesisdeterminedbyquantityoflabour。
　　（3。ii。20）Thefirstcapital，ashasjustbeenseen，beingtheresultofpurelabour，bearsavalue
　　in
　　proportiontothatlabour。Thiscapitalconcursinproduction。Anditiscontendedthatassoonas
　　capitalconcursinproduction，thevalueofthecommodityproducedisdeterminedbythevalue
　　ofthecapital。Butthevalueofthatcapitalitself，wehavejustobserved，isdeterminedbylabour。
　　Tosay，therefore，thatthevalueofaproductisdeterminedbythevalueofthecapital，isofno
　　use，whenyouhavetogobeyondthevalueofthecapital，andask，whatitisbywhichthatvalue
　　isitselfdetermined。Tosaythatthevalueoftheproductisdeterminedbythevalueofthe
　　capital，butthevalueofthecapitalisdeterminedbythequantityoflabour，istosaythatthe
　　valueoftheproductisdeterminedbythequantityoflabour。
　　（3。ii。21）Itthusundeniablyappears，thatnotonlythevalueofthefirstcapital，but，byequal
　　necessity，thatofthecommoditieswhichareproducedbythefirstcapital，isdeterminedby
　　quantityoflabour。Capitalofthesecondstagemustconsistinthecommoditieswhichare
　　producedbythatofthefirststage。Itmust，therefore，beestimatedbythequantityoflabour。The
　　samereasoningappliestoitineverysubsequentstage。Thevalueofthefirstcapitalwas
　　regulatedbyquantityoflabour：thevalueofthatwhichwasproducedbythefirstcapitalwas
　　regulatedbythevalueofthefirst：that，however，wasvaluedbylabour：thelast，therefore，is
　　valuedbylabour；andsoon，withoutend，asoftenassuccessiveproductionsmaybesupposedto
　　bemade。But，ifthevalueofallcapitalmustbedeterminedbylabour，itfollows，uponall
　　suppositions，thatthevalueofallcommoditiesmustbedeterminedbylabour。
　　（3。ii。22）Tosay，indeed，thatthevalueofcommoditiesdependsuponcapital，impliesoneof
　　the
　　mostobviousofallabsurdities。Capitaliscommodities。Ifthevalueofcommodities，then，
　　dependsuponthevalueofcapital，itdependsuponthevalueofcommodities；valueinshort
　　dependsuponvalue。Thisisnotanexpositionofvalue。Itisanattemptclearlyandcompletely
　　abortive。
　　（3。ii。23）Itthusappears，thatquantityoflabour，inthelastresort，determinestheproportion
　　in
　　whichcommoditiesexchangeforoneanother。
　　（3。ii。24）Thereisonephenomenonwhichisbroughttocontroverttheseconclusions，and
　　which
　　itis，therefore，necessarytoexplain。
　　（3。ii。25）Itissaidthattheexchangeablevalueofcommoditiesisaffectedbytime，without
　　the
　　interventionoflabour；because，whenprofitsofstockmustbeincluded，somuchmustbeadded
　　foreveryportionoftimewhichtheproductionofonecommodityrequiresbeyondthatof
　　another。Forexample，ifthesamequantityoflabourhasproducedinthesameseasonacaskof
　　wine，and20sacksofflour，theywillexchangeagainstoneanotherattheendoftheseason：but
　　iftheownerofthewineplacesthewineinhiscellar，andkeepsitforacoupleofyears，itwillbe
　　worthmorethanthe20sacksofflour，becausetheprofitsofstockforthetwoyearsmustbe
　　addedtotheoriginalprice。Hereisanadditionofvalue，buthereitisaffirmed，therehasbeenno
　　newapplicationoflabour；quantityoflabour，therefore，isnottheprinciplebywhich
　　exchangeablevalueisregulated。
　　（3。ii。26）Thisobjectionisfoundeduponamisapprehensionwithrespecttothenatureof
　　profits。
　　Profitsare，inreality，themeasureofquantityoflabour；andtheonlymeasureofquantityof
　　labourtowhich，inthecaseofcapital，wecanresort。Thiscanbeestablishedbyrigidanalysis。
　　（3。ii。27）Iftwocommoditiesareproduced，abaleofsilk，forexample，forimmediate
　　consumption，andamachine，whichisanarticleoffixedcapital；itiscertain，thatifthebaleof
　　silkandthemachinewereproducedbythesamequantityoflabour，andinthesametime，they
　　wouldexactlyexchangeforoneanother：quantityoflabourwouldclearlybetheregulatorof
　　theirvalue。
　　（3。ii。28）Butsupposethattheownerofthemachine，insteadofsellingit，isdisposedtouse
　　it，for
　　thesakeoftheprofitswhichitbrings；whatistherealcharacterandnatureofhisaction？Instead
　　ofreceivingthepriceofhismachineallatonce，hetakesadeferredpayment，somuchper
　　annum：hereceives，infact，anannuity，inlieuofthecapitalsum；anannuity，fixedbythe
　　competitionofthemarket，andwhichisthereforeanexactequivalentforthecapitalsum。
　　Whatevertheproportionwhichthecapitalsumbearstotheannuity，whetheritbetenyears’
　　purchase，ortwentyyears’purchase，suchaproportioniseachyear’sannuityoftheoriginalvalue
　　ofthemachine。Theconclusion，therefore，isincontrovertible：astheexchangeablevalueofthe
　　machine，haditbeensoldassoonasmade，wouldhavebeenthepracticalmeasureofthe
　　quantityoflabouremployedinmakingit，one—tenthorone—twentiethofthatvaluemeasuresalso
　　atenthoratwentiethofthequantityoflabour。
　　（3。ii。29）Ifapieceofmachinery，whichhascost100days’labour，isappliedinmakinga
　　commodity，andiswornoutinthemakingofit；andif100days’purelabourareemployedin
　　makinganothercommodity；theproduceofthemachine，andtheproduceofthelabour，
　　supposingnoadjustmentnecessaryfordifferenceoftime，willexchangeagainstoneanother。
　　（3。ii。30）Makenowadifferentsupposition：thatthemachineisanarticleoffixedcapital，
　　andnot
　　wornout，andletustracetheconsequences。Itwascorrectlysupposed，intheformercase，that
　　100days’labourwereexpendedbywearingoutthemachine；but100days’labourhavenotbeen
　　expendedinthesecond，becausethemachineisnotwornout。Somelabour，however，hasbeen
　　expended，because100days’labourinamasshasbeenapplied。Howmuchofitshallwesayhas
　　beenexpended？Wehaveanexactmeasureofitintheequivalentwhichispaid。Iftheequivalent
　　whichwasobtainedwhenthemachinewaswornout，wasameasureof100days’labour，
　　whateverproportionofsuchequivalentisreceivedasayear’suseofthemachinewhennotworn
　　out，mustrepresentacorrespondingproportionofthelabourexpendeduponthemachine。
　　（3。ii。31）CapitalisallowedtobecorrectlydescribedunderthetitleofhoardedLabour。A
　　portion
　　ofcapitalproducedby100days’labour，is100days’hoardedlabour。Butthewholeofthe100
　　days’hoardedlabourisnotexpended，whenthearticleconstitutingthecapitalisnotwornout。A
　　partisexpended，andwhatpart？Ofthiswehavenodirect，wehaveonlyanindirectmeasure。If
　　capital，paidforbyanannuity，ispaidforattherateof10percent，one—tenthoftheboarded
　　labourmaybecorrectlyconsideredasexpendedinoneyear。
　　（3。ii。32）Theinstancewhichiscommonlyadducedasexemplifyingthesupposedfactofan
　　increaseofvaluewithoutincreaseoflabour，isthatofwine。Wineacquiresagreatervalueby
　　beingmerelydepositedinthecellarsofthemerchant。
　　（3。ii。33）Buttheywhowouldadvancethis，asananswertotheantecedentreasoning，donot
　　perceivetheforceoftheirownobjection。Theirdoctrineis，thatexchangeablevalueisregulated
　　bycostofproduction。Costofproductionistheoutlaynecessaryforcompletingtheproduct。
　　Whenthewinewasputintothecellar，itwasworthsomuch，accordingtothecapitalexpended
　　initsproduction。Whenitisplacedinthecellar，nomorecapitalisemployeduponit，norany
　　morelabour；andyetitacquiresanadditionalvalue。Thequestion，whyitacquiresmorevalue，
　　whenthereisnotmorecapital，isjustasdifficult，aswhyitacquiresmorevalue，whenthereis
　　notmorelabour。
　　（3。ii。34）Itisnosolutiontosay，thatprofitsmustbepaid；becausethisonlybringsustothe
　　question，whymustprofitsbepaid？Tothisthereisnoanswerbutone，thattheyarethe
　　remunerationforlabour；labournotappliedimmediatelytothecommodityinquestion，but
　　appliedtoitthroughthemediumofothercommodities，theproduceoflabour。Thusamanhasa
　　machine，theproduceof100days’labour。Inapplyingit，theownerundoubtedlyapplieslabour，
　　thoughinasecondarysense，byapplyingthatwhichcouldnot—havebeenhadbutthroughthe
　　mediumoflabour。Thismachine，letussuppose，iscalculatedtolastexactly10years。Onetenth
　　ofthefruitsof100days’labouristhusexpendedeveryyear；whichisthesamethingintheview
　　ofcostandvalue，assayingthat10days’labourhavebeenexpended。Theowneristobepaidfor
　　the100days’labourwhichthemachinecostshim，attherateofsomuchperannum，thatis，by
　　anannuityfortenyears，equivalenttotheoriginalvalueofthemachine。Itthusappearsthat
　　profitsaresimplyremunerationforlabour。Theymay，indeed，withoutdoinganyviolenceto
　　language，hardlyevenbyametaphor，bedenominatedwages：thewagesofthatlabourwhichis
　　applied，notimmediatelybythehand，butmediately，bytheinstrumentswhichthehandhas
　　produced。Andifyoumaymeasuretheamountofimmediatelabourbytheamountofwages，
　　youmaymeasuretheamountofsecondarylabourbythatofthereturntothecapitalist。We
　　surelyhavenotoccasiontoadd，thatifthisbethegeneralaccountofprofits，whichseems
　　undeniable，itisapplicabletoallparticularcases，tothatofwineinthecellar，aswellastoevery
　　other。Supposethat100menmakeamachineinoneday，thatanother100menemploythis
　　machinethenextday，andwearitout；thefirst100men，andthesecond100men，willdividethe
　　produceequallybetweenthem。Theshareofthefirst100menispaymentforcapital，nodoubt，
　　butitisalso，mostobviously，paymentforlabourtoo；andinwhateverdegreelabouris
　　productive，thatis，yieldsmorethanisconsumedineffectingtheproduct，tothatdegreean
　　advantageisaffordedbeyondthereplacingofthecapitalconsumed，andconstitutesprofit。
　　（3。ii。35）Thereturnwhichismadetocapitalemployedupontheland，isthatwhich
　　determines
　　therateofannualprofitfromallotheremploymentsofcapital；and，ofcourse，forthatwhichis
　　employedinmelioratingwineinawine—cellar。Thecaseofthewineinthecellarcoincides
　　exactlywiththatofamachinewornoutinayear，whichworksbyitselfwithoutadditional
　　labour。Thenewwine，whichisonemachine，isreplacedbyitsproduce，theoldwine，withthat
　　additionofvaluewhichcorrespondswiththereturntocapitalemployedupontheland；andthe
　　accountwhichistoberenderedoftheonereturn，isalsothetrueaccountoftheother。
　　SectionIII。EffectUponExchangeableValuesofaFluctuation
　　inWagesandProfits。
　　（3。iii。1）Instatingthatcommoditiesareproducedbytwoinstruments，LabourandCapital，of
　　whichthelastistheresultoflabourwe，ineffect，mean，thatcommoditiesareproducedbytwo
　　quantitiesoflabour，differentlycircumstanced；theone，immediate，orprimarylabour，that
　　whichisappliedatoncebythehandofthelabourer；theother，hoarded，orsecondarylabour，
　　thatwhichistheresultofformerlabour，andeitherisappliedinaidoftheimmediatelabour，or
　　isthesubjectmatteruponwhichitisbestowed。
　　（3。iii。2）Ofthesetwospeciesoflabour，twothingsaretobeobserved：First，thattheyarenot
　　alwayspaidaccordingtothesamerate；thatis，thepaymentoftheonedoesnotrisewhenthatof
　　theotherrises，orfallwhenthatoftheotherfalls：And，secondly，thattheydonotalways
　　contributetotheproductionofallcommoditiesinequalproportions。
　　（3。iii。3）Iftherewereanytwospeciesoflabour，thewagesofwhichdidnotriseandfallin
　　the
　　sameproportion，andwhich，contributingtotheproductionofallcommodities，didnot
　　contributetothemallinequaldegrees，thiscircumstance，oftheirnotcontributinginequal
　　degrees，wouldcreateadifferenceinexchangeablevalues，asoftenasanyfluctuationtookplace
　　intherateofwages。
　　（3。iii。4）Ifallcommoditieswereproducedbyaportionofskilled，andaportionofunskilled
　　labour，buttheratiowhichtheseportionsboretooneanotherweredifferentindifferent
　　commodities；andif，asoftenasthewagesofskilledlabourrose，thewagesofunskilledlabour
　　rosetwiceasmuch；itisveryobvious，that，uponariseofwages，thosecommodities，tothe
　　productionofwhichagreaterproportionofunskilledlabourwasapplied，wouldriseinvalueas
　　comparedwiththosetowhichalessproportionwasapplied。Itisalsoobvious，that，thoughthis
　　differenceintheratiosaccordingtowhichthewagesofthetwokindsoflabourhadaltered，and
　　intheproportionsinwhichtheywereappliedtotheproductionofdifferentcommodities，would，
　　uponariseorfallinwages，altertherelativevalueofthecommodities，itwoulddoso，without
　　intheleastdegreeaffectingthetruthoftheproposition，thatquantityoflabourdetermined
　　exchangeablevalues。
　　（3。iii。5）Thecaseispreciselythesamewhenweconsiderthatitisthetwospeciesoflabour，
　　calledprimaryandsecondary，whichareappliedindifferentproportions。
　　（3。iii。6）Threecaseswillconvenientlyexemplifythedifferentdegreesinwhichlabourand
　　capitalrespectivelycontributetoproduction。Thesearethetwoextremecases，andthemedium。
　　Thefirstisthatofcommoditieswhichareproducedbyimmediatelabouralonewithoutcapital；
　　thesecond，thatofcommoditiesproduced，onehalfbycapital，onehalfbyimmediatelabour；
　　thethird，thatofcommoditiesproducedbycapitalalonewithoutimmediatelabour。Thereare
　　perhapsnoactualcaseswhichperfectlycoincidewitheitheroftheextremes。Thereare，
　　however，caseswhichapproximatetoboth；andwhenthemostsimpleareillustratedas
　　examples，allowancecaneasilyandcorrectlybemadeforthedifferencesoftherest。
　　（3。iii。7）Iftwospeciesoflabourareemployedintheproductionofcommodities；andif，
　　when
　　thepaymentoftheonespeciesoflabourrises，thatoftheotherfalls；acommodity，inthe
　　productionofwhichagreaterproportionofthefirstspeciesoflabourisemployed，will，upona
　　riseinthepaymentofthatspeciesoflabour，riseinexchangeablevalue，ascomparedwitha
　　commodityinwhichlessisemployed。Thedegreehowever，inwhichitwillrise，willdepend
　　upontwocircumstances：first，uponthedegreeinwhichthepaymentoftheonespeciesoflabour
　　fallswhentheotherrises；and，secondly，uponthedegreeinwhichtheproportionofthelabour
　　ofthefirstkind，employedinitsproduction，exceedstheproportionofitwhichisemployedin
　　theproductionoftheothercommodity。
　　（3。iii。8）Thefirstquestionthen，is，inwhatdegree，whenwagesrise，doprofitsfall？Andthis
　　is
　　theonlygeneralquestion；forthedegreeinwhichthetwospeciesoflabourcombineinthe
　　productionofdifferentcommodities，dependsuponthecircumstancesofeachparticularcase。
　　（3。iii。9）Ifallcommoditiescorrespondedwiththefirstofthecases，assumedaboveas
　　examples，
　　andwhichwemay，forthesakeofabbreviation，designate，asNo。1，No。2，No。3；inother
　　words，ifallcommoditieswereproducedwhollybylabour，capitalbeingsolelyemployedinthe
　　paymentofwages；inthatcase，justasmuchaswagesoflabourrose，profitsofstockwouldfall。
　　（3。iii。10）Supposeacapitalof1000l。tobethusemployed，andprofitstobe10percent。，the
　　valueofthecommoditywouldbe1100l。，forthatwouldreplacethecapitalwithitsprofits。The
　　commoditymayberegardedasconsistingof1100parts，ofwhich1000wouldbelongtothe
　　labourers，and100tothecapitalist。Letwages，uponthis，besupposedtorise5percent。；inthat
　　case，itisevident，thatinsteadof100partsofthe1100，thecapitalistwouldreceiveonly50；his
　　profits，therefore，insteadof10wouldbeonly5percent。Insteadof1000l。Hewouldhaveto
　　pay1050l。inwages。Thecommoditywouldnotriseinvaluetoindemnifyhim，becausewehave
　　supposedthatallcommoditiesareinthesamesituation；itwould，therefore，beofthevalueof
　　1100l。，asbefore，ofwhich50l。alonewouldremainforhimself。
　　（3。iii。11）IfallcommoditiescorrespondedwiththecaseNo。2，profitswouldfallonlyhalfas
　　muchaswagesrose。Ifwesupposethat1000l。werepaidinwages，and1000l。employedin
　　fixedcapital；thatprofits，asbefore，were10percent。，andthisthewholeexpenditure；thevalue
　　ofthecommoditywouldbe1200l。becausethatisthesumwhichwouldreplacethecapital
　　expendedandpaytheprofitsofthewhole。Inthiscasethecommoditymightbeconsideredas
　　dividedinto1200parts，ofwhich200wouldbelongtothecapitalist。Ifwagesrose5percent。，
　　andinsteadof1000l。aswages，hepaid1050l。hewouldstillretain150l。asprofits；inother
　　words，hewouldsustainareductionofonly2—1/2percent。
　　（3。iii。12）Thecasewouldbepreciselythesame，ifwesupposedthe1000l。ofcapital，which
　　is
　　notemployedinthepaymentofwages，tobeemployedinanyproportion，intheshapeof
　　circulatingcapitalconsumedinthecourseoftheproductiveprocess，andrequiringtobe
　　replaced。Thus，while1000l。wereemployedinthepaymentofwages，500l。mightbeemployed
　　asfixedcapitalindurablemachinery，500l。inrawmaterialandotherexpenses。Ifthiswerethe
　　stateoftheexpenditure，thevalueofthearticlewouldbe1700l。；beingtheamountofthe
　　capitaltobereplaced，and10percent。profitsuponthewhole。Ofthese1700parts，1000would
　　betheshareofthelabourers，thoughpaidinadvance，and700theshareofthecapitalist，200
　　beingprofits。If，now，wagesweretorise5percent。，1050oftheabove1700partswouldbethe
　　shareofthelabourers，and650onlywouldremaintothecapitalist，ofwhich，afterreplacinghis
　　500l。ofcirculatingcapital，150wouldremainasprofits；areductionof2—1/2percent。asbefore。
　　（3。iii。13）Ifallcommoditiescorrespondedwiththethirdcase，asnowageswouldbepaid，
　　profits
　　couldnotbeaffectedbytheriseofthem：anditisobvious，that，inproportionascommodities
　　maybesupposedtoapproachthatextreme，profitswouldbelessandlessaffectedbysucharise。
　　（3。iii。14）Ifwesuppose，whatismostprobable，that，intheactualstateofthings，asmany
　　cases
　　areontheonesideofthemediumasontheother，theresultwouldbe，inconsequenceofthe
　　mutualcompensationsthatwouldtakeplace，thatprofitswouldbereducedexactlyhalfasmuch
　　aswagesrose。
　　（3。iii。15）Thestepsmaybetracedasfollows：
　　（3。iii。16）Whenwagesrise，andprofitsfall，itisevidentthatallcommodities，madewitha
　　less
　　proportionoflabourtocapital，willfallinvalue，ascomparedwiththosewhicharemadewitha
　　greater。Thus，ifNo。1istakenasthestandard，thatinwhichcommoditiesareproducedwholly
　　bylabour；allcommoditiesbelongingtothatcasewillbesaidtoremainofthesamevalue；all
　　belongingtoanyoftheothercaseswillbesaidtofallinvalue。IfNo。2istakenasthestandard，
　　allcommoditiesappertainingtothatcasewillbesaidtoremainofthesamevalue；all，belonging
　　toanycasenearerthefirstextreme，willbesaidtoriseinvalue；all，toanynearerthelast
　　extreme，tofall。
　　（3。iii。17）Thosecapitalists，whoproducearticlesofcaseNo。1，sustain，whenwageshave
　　risen5
　　percent。，anadditionalcostof5percent。；buttheyexchangetheircommodityagainstother
　　commodities。IftheyexchangethemagainstthoseofcaseNo。2，wherethecapitalistshave
　　sustainedanadditionalcostofonly2—1/2percent。，theywillreceive2—1/2percent。additional
　　quantity。Thus，inobtaininggoods，producedunderthecircumstancesofcaseNo。2，theyobtain
　　acertaindegreeofcompensation，andsustain，bytheriseofwages，adisadvantageofonly2—1/2
　　percent。Inthisexchange，however，theresult，withrespecttothecapitalistswhoproducegoods
　　underthecircumstancesofcaseNo。2，isreversed。Theyhavealreadysustainedadisadvantage
　　of2—1/2percent。，intheproductionoftheirgoods，andaremadetosustainanotherdisadvantage
　　of2—1/2percent。inobtaining，byexchangethegoodsproducedunderthecircumstancesofcase
　　No。1。
　　（3。iii。18）Theresult，then，uponthewhole，is，thatallproducers，whopossessthemselves，
　　either
　　byproductionorexchange，ofgoodsproducedunderthecircumstancesofcaseNo。2，sustaina
　　disadvantageof2—1/2percent。；thosewhopossessthemselvesofgoodsincasesapproachingthe
　　firstextreme，sustainagreater；thoseincasesapproachingthelast，alessdisadvantage：that，if
　　thecasesontheonesideareequaltothoseontheother，alossofpercent。issustaineduponthe
　　whole；thatthis，accordingly，istheextenttowhich，inpractice，itmaybesupposedthatprofits
　　arereduced。
　　（3。iii。19）Fromtheseelementsitiseasytocomputetheeffectofariseofwagesuponprice。
　　All
　　commoditiesarecomparedwithmoney，orthepreciousmetals。Ifmoneybesupposedto
　　correspondwithcaseNo。2，ortobeproduced，whichisprobablynotfarfromthefact，byequal
　　proportionsoflabourandcapital；thenallcommodities，producedunderthesemedium
　　circumstances，arenotalteredinpricebyariseofwages；thosecommoditieswhichapproach
　　nearerthefirstextreme，oradmitagreaterproportionoflabourthancapitalintheirformation，
　　riseinprice：thosewhichapproachthesecond，thatis，haveagreaterportionofcapitalthan
　　labour，fall：and，upontheaggregateofcommoditiesoralltakentogether，thereisneitherfall
　　norrise。
　　（3。iii。20）Fromtheexplanations，hereafforded，itwillbeeasytoseewhatismeantbythe
　　term
　　"measureofvalue，"andwhereinitdiffersfromthatwhichwehavealreadyendeavouredto
　　explain，the"regulatorofvalue。"
　　（3。iii。21）Money，thatis，thepreciousmetalsincoin，servespracticallyasameasureof
　　value，as
　　isevidentfromwhathasimmediatelybeensaid。Acertainquantityofthepreciousmetalistaken
　　asaknownvalue，andthevalueofotherthingsismeasuredbythatvalue；onecommodityis
　　twice，anotherthricethevalueofsuchaportionofthemetal，andsoon。
　　（3。iii。22）Itisevident，however，thatthiscanremainanaccuratemeasureofvalue，onlyifit
　　remainsofthesamevalueitself。Ifacommodity，whichwastwicethevalueofanounceof
　　silver，becomesthreetimesitsvalue，wecanonlyknowwhatchangehastakenplaceinthevalue
　　ofthiscommodity，ifweknowthatourmeasureisunchanged。
　　（3。iii。23）Butthereisnocommoditytobetakenasameasureofvalue，whichisnotitself
　　liable
　　toalterationsinvalue，orinitspowerofpurchasing，fromachangeinthequantityoflabourand
　　capitalrequiredbothforitsownproduction，andthatofothercommodities，andalsofroma
　　changeinwagesandprofits。
　　（3。iii。24）Thealterationofvalue，arisingfromachangeinthequantityoflabourrequiredfor
　　production，isthemostimportant；forifwecouldbesure，thatthecommoditychosenforour
　　measureofvaluewasitselfalwaysproducedunderthesamecircumstances，thatis，bythesame
　　quantityofimmediate，andthesamequantityofhoarded，labour，itwouldalwaysanswerthe
　　followingpurposes：1st，itwouldshow，byeveryalterationinitspowerofpurchasinga
　　commodityproducedbythesameproportionoflabourandcapital，thealterationwhichhad
　　takenplaceinthecostofproductionofthatcommodity，orinthatbywhichitsvalueis
　　regulated：and2dly，itmightbeaccommodatedbycalculationtothechangesinvalue，produced
　　bythealterationofwagesandprofits，inthecaseofcommoditiesnotproducedbythesame
　　proportionsoflabourandcapital。
　　（3。iii。25）Thus，ifgoldwereproducedunderthecircumstancesofcaseNo。1，bymere
　　labour，
　　pickedup，forexample，bythehand，fromthebedsofrivers，andalwaysinequalquantity，in
　　returnforanequalquantityoflabour，itwouldalwaysbeameasure，exactlyandimmediately，of
　　allcommoditiesproducedbypurelabour。Inthecase，however，ofariseofwages，andafallin
　　theprofitsofstock，goldwouldinthesecircumstancesriseascomparedwithcommodities
　　producedunderthecircumstancesofcaseNo。2，thoughnoalterationshouldhavetakenplacein
　　theamountofthelabourandcapitalrequiredfortheirproduction。Itisevident，therefore，thatin
　　thesecircumstances，gold，fluctuatinginvaluewitheveryfluctuationinthewagesoflabour，
　　wouldveryimperfectlyservethepurposesofameasureofvalue。Ifacontract，forexample，
　　weremade，topayanannuityofsomuchgoldfortwentyyears，itmightbe10percent。more，or
　　10percent。less，attheendofthatperiod，thanitwasatthebeginning。Oflabouritwouldallthe
　　timecommandexactlythesamequantity，butofallcommoditiesproducedbyaidofcapitalit
　　wouldcommandadifferentquantity，andthat，inproportiontothedegreeinwhichcapital，not
　　labour，wastheinstrumentoftheirproduction。
　　（3。iii。26）Thoughwecanbystrictanalysisdiscover，thatexchangeablevalueisproportioned
　　to
　　quantityoflabourexpendedinproduction，therearethreecircumstanceswhichpreventits
　　applicationasthemeasureofvalue。
　　（3。iii。27）Inthefirstplace，therearetwokindsoflabouremployedinproduction，andthe
　　degree
　　inwhichtheproduceissharedbetweenthemoftenvaries，andoccasionsaswehaveseen，a
　　correspondingvariationintheexchangeablevaluesof’commoditiesproducedbydifferent
　　proportionsofthesetwokindsoflabour。Inthenextplace，wehavenopracticalmeansof
　　ascertainingbeforehandtheexactquantityofhoardedlabourwhichgoestoproduction，since
　　theonlymeasurewehaveofitsquantityisthepricewhichitbrings。Inthethirdplace，labouris
　　notconstantinitsproductivepowers。Ifoneday’slabourproducedalwaysthesamequantityof
　　gold，butnotthesamequantityofcorn，orofcloth，theexchangeablevalueofgoldwouldalter
　　inrespecttocornandcloth。
　　（3。iii。28）Fromtheseexplanationsitalsoappears，thatnothingelsecanbeappliedasan
　　accurate
　　measureofvalue。
　　（3。iii。29）Everycommoditymaybeconsideredasproducedunderoneofthethreesetsof
　　circumstancesspecifiedabove。Ifwetakeasourmeasureacommodity，producedunderthe
　　circumstancesNo。1，thegold，forexample，pickedupbythehand，thiswillalwayspurchasethe
　　samequantityofpurelabour，andofsuchcommoditiesasareproducedbythesamequantityof
　　thatlabour；butitwillnotpurchasethesamequantityofcommoditieswhichcometoneedmore
　　orlessoflabour，northesamequantityoftheproduceofhoardedlabour，butlessofitin
　　proportionaswagesrise，moreaswagesfall。Couldwetakeasourmeasureacommodity
　　producedunderthecircumstancesNo。3，thatis，byhoardedlabouralone，itwouldalways
　　purchasethesamequantityoftheproduceofhoardedlabour，whennoalterationhadtakenplace
　　initsproductivepowers，butlessormoreoftheproduceofimmediatelabour，accordingas
　　profits，thewagesofhoardedlabour，roseorfell。Acommodity，producedunderthemedium
　　circumstances，answersthepurposebest；becausebyfarthegreaternumberofcommoditiesare
　　producedundercircumstancesmorenearlyapproachingtothemediumthananyoftheextremes。
　　Gold，therefore，whichisproducedinthesecircumstances，andwithlessvariationinthequantity
　　ofthetwokindsoflabourappliedtoitsproduction，thanalmostanyothercommodity，hasthis
　　recommendationamongothers，tobethemediumofexchange，thatitislessimperfectasa
　　measureofvaluethanalmostanyothercommodity，whichcouldbetaken。Suchaberrationsas
　　areobvious，andcapableofbeinginsomedegreeforeseen，practicalsagacitycorrectsbythe
　　properallowances。Thiscannotbedonewhengreatandunexpectedchangestakeplace；and
　　muchdisorderistheconsequence。
　　SectionIV。OccasionsonWhichitistheInterestofNationsto
　　ExchangeCommoditieswithOneAnother（3。iv。1）Wehavealreadyseen，thatthebenefits，derivedfromthedivisionandskilful
　　distribution
　　oflabour，formpartofthemotiveswhichgiverisetotheexchangeofcommodities。Menwill
　　notconfinethemselvestotheproductionofoneonlyofthevariousarticleswhichcontributeto
　　thewell—beingoftheindividual，unlesstheycan，byitsmeans，providethemselveswithothers。
　　（3。iv。2）Thereisanothercircumstance，whichveryobviouslyaffordsamotivetoexchange
　　commodities。Somecanbeproducedonlyinparticularplaces。Metals，coals，andvariousother
　　commoditiesofthegreatestimportance，aretheproductofcertainspots。Thesameisthecase
　　withsomevegetableproductions，towhicheverysoilandclimatearenotadapted。Certain
　　commodities，thoughnotconfinedtoparticularspots，canyetbemoreconvenientlyandcheaply
　　producedinsomeplacesthaninothers；commodities，forexample，whichrequireagreat
　　consumptionoffuel，inacoalcountry；commodities，themanufactureofwhichrequiresastrong
　　movingpower，whereasufficientfallofwatercanbeobtained；commoditieswhichrequirean
　　extraordinaryproportionofmanuallabour，whereprovisions，andconsequentlylabour，are
　　cheap。