must be competent to express an increase or diminution of the one without the other, or a variation in one while the other remains constant, or changed in a different ratio. In the prosecution of our endeavours, we may succeed in one of the objects, though not in another; we may procure a higher gratification with the same labour, or the same gratification with less labour. Thus, at one time, we may substitute in our sugar colonies, the cultivation of the New Zealand cane in place of that from Bengal, by which the produce of sugar is doubled,, and yet the labour of cultivation may perhaps be in both cases the same. At another time, we may manufacture cloth of equal goodness, but with half the labour required before. In each of these cases we succeed. In the first, by increasing the gratification arising from a double quantity of sugar; in the second, by lessening the labour of procuring the cloth. A standard measure of production must, therefore, be a compound term, in the direct ratio of the gratification, and the inverse ratio of the toil. But there is no one simple term or idea that can express these different circumstances; since they are of such a nature that it is impossible for a single term to serve the purpose, and therefore, if a compound term be not used, there must be two measures which must in all cases be applied to afford a correct conception of the amount of the products of industry. In short, it is the same with the estimate of the supply of the community as with that of individuals: in both cases, the two identical inquiries are to be made; first, what is its quantity and quality? and, secondly, what did it cost? And how should it be otherwise? or why should we expect in political economy a measure to estimate results different from what we are content with in ordinary affairs? The supply of the community is but the sum of the supplies of the separate individuals who compose it; and the same ideas and views apply to the whole, as apply to its separate parts. The general adoption in our colonies of the New Zealand cane is not considered the less an improvement, or the less worthy of introduction, because the price of sugar is lower, and the condition of the planters from this or some other cause worse, than previously to its adoption.

Now, if, in considering the different terms which have been

used as standards or measures to estimate production, we carry with us the recollection that there must be found in each of them these two elements, gratification and toil; in other words, the sum of the supply and its cost; we shall then be able to appreciate their just value, and suitability to the purposes to which they are applied, that ought to be ascribed to these different standards or measures. If in any one of them these two elements be not found, it must be not only useless as a measure of the products of industry, but its adoption would, in all probability, mislead.

The different terms that have been used by economists as expressing the qualities, by which to estimate the amount of that wealth, which they have considered as the sole object of their inquiries, are these,―value, utility, cost in human agency. But if we attentively consider each of these different terms, we shall find that in none of them are contained those two ideas before spoken of, gratification and toil; or, the sum and its cost; and, consequently, that not one of these terms can give a just conception of the degree of success or failure which may attend our labours; and therefore cannot safely be relied upon in economical reasonings, as affording a correct estimate from which just and useful conclusions may be deduced.

The quality of value is that quality by which objects of wealth are most commonly estimated and compared; and, in the ordinary transactions of business, in the interchange of these objects between individuals or nations, there is no other quality which so accurately represents all those properties that are important to be known in such transactions, and is so completely adapted to the purpose. Value is indeed a quality which has reference solely to exchange, and its appreciation is usually of small moment except with reference to exchanges.

The term value is used in different senses. We have value in use, real value, and value in exchange. Value in use is the same thing as utility. The idea which real value is employed to convey is, the magnitude of the labour expended in the production of commodities; which is the same as cost of production. Again, value in exchange has been said to be nominal and real;-nominal, or value in the precious metals;

and real, or the power of commanding commodities and labour in exchange. It will be seen by and by, that for the objects which political economy has in view, neither utility nor cost of production is a quality by which a just estimate can be formed of those properties of products that are important to be expressed. Not less unsuitable is value in exchange.

The general adoption of the quality of exchangeable value to express the amount of national wealth, seems to call for a more lengthened notice of this quality than would otherwise be proper.

The valuation of an object is the affirmation that it is in a certain degree of general estimation with mankind, as compared with some other specified object, and that there are persons who are able and willing to give this other object for it.

The quality of value in objects arises from the constitution of man; from his wants and wishes, and the necessity imposed on him to exert himself in order to supply them. These wants are affected by the climate in which he lives; the laws, customs, and manners of the particular society to which he belongs; as well as by an infinite variety of other circumstances.

Of these wants, some being satisfied by the gratuitous agency of natural objects, as of air, water, or solar light, mankind are not called upon to earn the satisfaction of such wants by any sacrifice or exertion; and as men will make no sacrifice where they can avoid it, the things by which these wants are satisfied, are accordingly not possessed of exchangeable value. Other wants there are which can only be satisfied at the expense of a sacrifice of some kind or other; whether of labour, of money, or of goods. To the objects which satisfy such wants alone is any value attached; and for the obvious reason, that these cannot be obtained at all but at this expense, and that whoever has been obliged to make this sacrifice to acquire an article, will hardly resign it without receiving what is, in his estimation, an equivalent.

The value attributed to an object may or may not be a just estimate; since the judgments of men are liable to be swayed by ignorance, error, and caprice. Yet it must be taken as we find it, without reference to its correctness. But, in either case, value merely represents the sacrifice men are able and willing

to make for the object; and though the estimate were entirely free from error, the quality of value would not on that account be the less unsuitable for use, as the quality from which the estimate of national production is to be formed.

To confer value, two things are requisite: 1. That the commodity, as being useful or delightful to man, should be an object of his desire; 2. That it should exist in a degree of scarcity.

In observing on the nature of value in exchange, as a property by which to form an estimate of national production, the following facts are worthy of notice.

First, the quality of value in exchange, whether it be taken as nominal value, that is, value in the precious metals, or as real value in exchange, that is, the power to command in exchange the necessaries and conveniences of life, including labour, does not in either way exhibit either of those qualities we desire to ascertain; which are, the quantity and quality of the objects, and the cost at which they have been acquired.

Secondly, value in exchange does not represent any one quality actually subsisting in the commodity itself. An article may be of high value at one time, and of none at all at another. Ice in summer may fetch a considerable price, but not in winter. The same may be said as regards place. Coals at Newcastle are of different value from those sold in London. Amongst other things, the value of an article essentially depends on the relation of the demand for it to its supply, and the cost of production, or the value of the labour, capital, and land necessary to its acquisition. This value is raised by the scarceness of the article, and lowered by its abundant supply; and, again, it is raised by the difficulty, and lowered by the facility of acquisition. Now these are circumstances that do not belong to the article; which, indeed, are wholly independent of it. "So little," to use the language of the Earl of Lauderdale, "has the quality of things to do with their value, that it very often happens when a commodity possesses, in the highest degree of perfection, all the qualities which make it desirable, its value is the lowest; and when, on the contrary, it possesses them in a very inferior degree, its value is the highest. This is almost constantly the case with grain. In a fine season it is

always of a superior, in a bad season of an inferior, quality; yet, as the fine season generally produces an increased, and a bad season a diminished, quantity; with a thorough contempt of the quality, the value of the corn is always regulated on the principle here stated; and the greatness of the quantity, though of a superior quality, reduces its value; whilst the diminution of its quantity, though of very inferior quality, increases the value in the market." Value, then, is not an inherent property of the thing valued, such as figure, extension, durability, hardness, gravity, and the like,-properties which are essential to matter, and cannot be separated from it; but it is an abstract idea, perfectly independent of any actual quality subsisting in what is valued. Value is rather an affection of mind; it is an accident, a casual circumstance, which sometimes is, and sometimes is not, found to exist in connexion with those articles which minister to our wants and wishes. In fact, the affirmation of value in an object, is merely the affirmation of the ability and inclinations of men to give other things in exchange for it. In a standard measure of value, however, we look for something both definite in its nature, and as nearly as possible invariable in its value.

Thirdly, value in exchange is wholly matter of comparison between different objects: this is the case from its very nature, Representing the degree of estimation in which things are held, or the amount of other things that men are able and willing to give for them, the expression is not positive but relative, nor is it possible that value can be manifested or appreciated except by comparison. The estimate of value in any object is an estimate of the effect which two objects have on the wishes of men; not, indeed, of the positive effect of both or either of them, but of their relative effect, of the one having as great or a certain greater effect than the other.

Fourthly, value is not a quality of permanent existence; it is unstable in its very nature, and in a constant state of fluctuation. A change of circumstances, and a change in the relationship in which a man stands with men and things around him, cause a change in the objects of his wants and wishes; and con