Page:Manual of Political Economy.djvu/174

Rh force of each planet's attraction. For many of the practical purposes of astronomy, it may be stated with sufficient exactness that the orbit of the earth is a true ellipse; and just in a similar way, in a country such as England, competition is so much more powerful than any of the other motives which influence the adjustment of rents, that it will be sufficiently exact to affirm that the rents which are actually paid are those which would be deduced from Ricardo's theory. In some cases, however, other motives, which may be regarded as antagonistic to free competition, assume so much importance that they must be specially considered.

It will much assist clearness of conception, if we employ some technical language to describe the terms of Ricardo's theory. This theory implies that in any given condition of a country there is some land which will just pay for cultivation if it is let at a nominal rent. Thus, as it were, a margin of cultivation is marked, below which the cultivation of land cannot descend, unless some circumstances should occur which should either induce men to be satisfied with smaller profits, or should increase the productiveness of land; it must be borne in mind that there are two ways in which the productiveness of land may be increased; in the first place, a larger demand for agricultural produce may raise its value, and, in the second place, agricultural improvements may cause a greater amount of produce to be obtained from the soil. In the example which we have employed, it has been supposed that this margin of cultivation has been denoted by the farm occupied by B; for the produce which is raised from this farm only suffices to pay the expenses of cultivation, and to return B a fair remuneration for his capital and for his personal exertions. Under these conditions the land will pay no rent. Various circumstances, however, may occur which will enable rent to be obtained from this land, or, in other words, would cause the margin of cultivation to descend. Let us, therefore, inquire into some of these circumstances.

It has already been remarked that the current rate of profit which prevails in different countries varies greatly, in Australia ten per cent, can readily be obtained on the