Page:The Economic Journal Volume 1.djvu/157

Rh on the 'margin' of production clear their expenses, but have no surplus in hand to transfer to the landlords. This assumption of a 'no-rent' minimum has been often criticised, and many of the objections have been successfully answered. But one criticism seems to be of fundamental importance, and it is of the nature of a commentary on the theory rather than an objection to it. This criticism states that the differential advantages, of which rent is the measure, are of various kinds, and do not always vary in the same direction or degree. It is a consideration of this character, which seems to be implied in the arguments of Mr. Webb and Professor Munro before the Town Holdings Committee, and from it the consequence follows that what is a 'no-rent' or inferior land, regarded from the standpoint of one particular kind of advantage, may not be so with respect to another.

Ricardo, as his habit was, simplified the problem. He considered, as Professor Marshall has recently shown, the different crops which might be raised from the land as convertible into terms of corn; and, although he recognised the element of situation, he introduced it by a qualifying clause, and traced the rise of rent by differences of natural fertility. It was only at the end of his exposition that he became more comprehensive, and said that the 'exchangeable value' of the 'produce' of the 'most fertile and favourably situated land' would 'be adjusted by the total quantity of labour necessary in various forms, from first to last, to produce it and bring it to market.' And again, in spite of passages in which he qualifies his statements, he seems on the whole to have regarded wages and profits as more rigidly determined than we should hold them to be; and, in his exposition of the theory of rent, he appears to have postulated them as practically fixed. Nor lastly, had he more than a single market in view for the sale of the farm produce. These assumptions were legitimate for the purpose in hand, and they were not at variance with the broad characteristics of the times. But it is necessary to bear them continually in mind in any practical application of the theory to the circumstances of the present day.

Ricardo, then, in expounding the theory, may be considered to have regarded rent as a payment for differential advantages arising from the different fertility of different soils for the production of corn for a single market by producers, who paid wages, which were assumed to be fixed, and expected profits, which were assumed to be fixed also. Thus regarded the problem was comparatively simple; and such simplicity is a useful, if not a