of those goods is augmented by the wages of the carriers or sailors, and by the profits of the merchants who employ them. In what is gained upon the first of those two branches of commerce, consists the advantage which the town makes by its manufactures; in what is gained upon the second, the advantage of its inland and foreign trade. The wages of the workmen, and the profits of their different employers, make up the whole of what is gained upon both. Whatever regulations, therefore, tend to increase those wages and profits beyond what they otherwise would be, tend to enable the town to purchase, with a smaller quantity of its labour, the produce of a greater quantity of the labour of the country. They give the traders and artificers in the town an advantage over the landlords, farmers, and labourers in the country, and break down that natural equality which would otherwise take place in the commerce which is carried on between them. The whole annual produce of the labour of the society is annually divided between those two different sets of people. By means of those regulations a greater share of it is given to the inhabitants of the town than would otherwise fall to them, and a less to those of the country.

"The price which the town really pays for the provisions and materials annually imported into it, is the quantity of manufactures and other goods annually exported from it. The dearer the latter are sold, the cheaper the former are bought. The industry of the town becomes more, and that of the country less advantageous.

"The superiority which the industry of the towns has everywhere, in Europe, over that of the country, is not altogether owing to corporations and corporation laws. It is supported by many other regulations. The high duties upon foreign manufactures, and upon all goods imported by alien merchants, all tend to the same purpose. Corporation laws enable the inhabitants of towns to raise their prices, without fearing to be undersold by the competition of their own countrymen. Those other regulations secure them equally against that of foreigners. The enhancement of price occasioned by both is everywhere finally paid by the landlord, farmers, and labourers of the country

who have seldom opposed the establishment of such monopolies. They have commonly neither inclination nor fitness to enter into combinations; and the clamour and sophistry of merchants and manufacturers, easily persuade them that the private interest of a part, and of a subordinate part, of the society, is the general interest of the whole.

"In Great Britain, the superiority of the industry of the towns over that of the country, seems to have been greater formerly than in the present times. The wages of country labour approach nearer to those of manufacturing labour, and the profits of stock employed in agriculture to those of trading and manufacturing stock, than they are said to have done in the last century, or in the beginning of the present. This change may be regarded as the necessary, though very late, consequence of the extraordinary encouragement given to the industry of the towns. The stock accumulated in them comes in time to be so great, that it can no longer be employed with the ancient profit in that species of industry which is peculiar to them. That industry has its limits like every other; and the increase of stock, by increasing the competition, necessarily reduces the profit. The lowering of profit in the town, forces out stock to the country, where, by creating a new demand for country labour, it necessarily raises its wages. It then spreads itself, if I may say so, over the face of the land, and by being employed in agriculture, is in part restored to the country, at the expense of which, in a great measure, it had originally been accumulated in the town."*

For the explanation of the causes which, in modern Europe, have thus given to the commerce of the towns so decided an advantage over that of the country, I refer to what Mr. Smith has said on the subject in the third and fourth chapters of his Third Book, concerning the rise and progress of cities and towns after the fall of the Roman Empire. On the same subject, too, a great deal of most important and curious information is to be found in the first volume of Dr. Robertson's History of Charles the Fifth.

* [Wealth of Nations, Book I. chap. x.; Vol. I. pp. 193-199, tenth edition.]

To this general head of the privileges of corporations, the question concerning the advantages to be derived from universities properly belongs. Some valuable hints on this question have been suggested by Mr. Smith; but I must not at present enter upon the discussion.

Another class of obstructions to the natural distribution of labour and stock in the community, is produced by exclusive companies and monopolies of every description. The enormous length to which monopolies were carried in the reign of Queen Elizabeth, is well known. Mr. Hume tells us, that "she granted her servants and courtiers patents for monopolies; and these patents they sold to others, who were thereby enabled to raise commodities to what price they pleased, and who put invincible restraints upon all commerce, industry, and emulation in the arts. It is astonishing to consider the number and importance of those commodities, which were thus assigned over to patentees. Currants, salt, iron, powder, cards, calf-skins, fells, pouldavies, ox shin-bones, train oil, lists of cloth, pot-ashes, anise-seeds, vinegar, sea-coals, steel, aquavitæ, brushes, pots, bottles, salt- • petre, lead, accidence, oil, calaminestone, oil of blubber, glasses, paper, starch, tin, sulphur, new drapery, dried pilchards, transportation of iron ordnance, of beer, of horn, of leather, importation of Spanish wool, of Irish yarn. These are but a part of the commodities which had been appropriated to monopolists."*

These monopolies were, in a great measure, removed by a statute of James First, declaring all monopolies to be "contrary to law, and to the known liberties of the people. It was then supposed, that every subject of England had entire power to dispose of his own actions, provided he did no injury to his fellow-subjects, and that no prerogative of the king, no power of any magistrate, nothing but the authority alone of laws could restrain that unlimited freedom."+

While James, however, called in and annulled all the patents for monopolies which had been granted by his predecessors, and which had extremely fettered every species of domestic industry, exclusive companies still remained,-another species of mono* [History of England, Chap. xliv.] + [Ibid. chap. xlix.]

VOL. IX.

B

poly, by which every prospect of future improvement in commerce was for ever sacrificed for a little temporary advantage to the sovereign. Of this species of monopoly there are still various examples, which have the most extensive influence on the general prosperity of this country. Their necessary effect, in every instance, is not only to exclude the greater part of the nation from a trade to which it might be convenient for them to turn their stock, but to oblige them to buy the goods, which are the subject of it, at a dearer rate than if the trade were open to all. For a full illustration of these observations, I must refer to the seventh chapter of the Fourth Book of the Wealth of Nations.

The doctrine of the freedom of trade, in so far as it applies to monopolies and exclusive companies, seems to have been perfectly understood by various writers of the seventeenth century, and particularly by Sir Josiah Child; and after him, Mr. Cary, a merchant of Bristol, who published, in the year 1695, a short and very ingenious essay on the state of England in relation to its trade. The same doctrine is strongly and repeatedly urged by the celebrated John de Witt, in a work entitled, The True Interests and Maxims of the Republic of Holland and West-Friesland:-" Next to a liberty of serving God, follows the liberty of gaining a livelihood without any dear-bought city freedom, but only by virtue of a fixed habitation, to have the common right of other inhabitants; which is here very necessary for keeping the people we have, and inviting strangers to come amongst us. For it is evident, that landed men, or others that are wealthy, being forced by any accident to leave their country or habitation, will never choose Holland to dwell in, being so chargeable a place, and where they have so little interest for their money. And for those who are less wealthy, it is well known, that no man from abroad will come to dwell or continue in a country where he shall not be permitted to get an honest maintenance. And it may be easily considered, how great an inconveniency it would be in this country for the inhabitants, especially strangers, if they should have no freedom of choosing and practising such honest means of livelihood as they think best for their sub

sistence; or if, when they had chosen a trade, and could not live by it, they might not choose another. This, then, being evident, that strangers without freedom of earning their bread, and seeking a livelihood, cannot live amongst us; and as it is certain, that our Manufactories, Fisheries, Traffic, and Navigation, with those that depend upon them, cannot, without continual supplies of foreign inhabitants, be preserved here, and much less, augmented or improved; it is likewise certain, that among the endless advantages which accrue to Holland by strangers, and which might accrue more, our boors may be be likewise profited. For we see, that for want of strangers in the country, the boors must give such great yearly and daywages to their servants, that they can scarcely live, but with great toil, themselves, and their servants live rather in too great plenty. The same inconveniences we are likewise sensible of in cities, amongst tradesmen and servants, who are here more chargeable and burdensome, and yet less serviceable than in any other countries. . . . Therefore, it is necessary that all strangers that are masters, journeymen, consumptioners, merchants, traders, &c., should live peaceably amongst us, without any disturbance, let, or molestation whatever, and use their own estates and trades as they shall judge best."*

Nothing, however, in any of these writers, is more explicit or more enlightened than the language of the common law of England on this subject. As early as the reign of Henry the Sixth, Lord Chief-Justice Fortescue, who was a zealous friend, too, of prerogative, declares, in his book De Laudibus Legum Angliæ, cap. xxxvi., that "it is lawful for any man to trade and store himself with any wares and merchandise at his own. pleasure, and that every inhabitant of England by law enjoyeth all the fruits of his land, with all the profits he gaineth by his own labour." Such, also, is very nearly the language of a statute of James the First, formerly referred to, by which it is expressly enacted, "that all commissions, grants, licenses, charters and letters patent heretofore made or granted, or hereafter to be made or granted, to any person or persons, bodies politic [Part I. chap. xv. p. 66, seq. Ed. Lond. 1702.]