---
id: book-2-introduction
title: "Book 2 Introduction"
book: "2"
chapter: 0
artifact_type: content
---

BOOK II.
OF THE NATURE, ACCUMULATION, AND EMPLOYMENT OF STOCK.



      INTRODUCTION.

      In that rude state of society, in which there is no division of labour, in
      which exchanges are seldom made, and in which every man provides every
      thing for himself, it is not necessary that any stock should be
      accumulated, or stored up before-hand, in order to carry on the business
      of the society. Every man endeavours to supply, by his own industry, his
      own occasional wants, as they occur. When he is hungry, he goes to the
      forest to hunt; when his coat is worn out, he clothes himself with the
      skin of the first large animal he kills: and when his hut begins to go to
      ruin, he repairs it, as well as he can, with the trees and the turf that
      are nearest it.

      But when the division of labour has once been thoroughly introduced, the
      produce of a man’s own labour can supply but a very small part of his
      occasional wants. The far greater part of them are supplied by the produce
      of other men’s labour, which he purchases with the produce, or, what is
      the same thing, with the price of the produce, of his own. But this
      purchase cannot be made till such time as the produce of his own labour
      has not only been completed, but sold. A stock of goods of different
      kinds, therefore, must be stored up somewhere, sufficient to maintain him,
      and to supply him with the materials and tools of his work, till such time
      at least as both these events can be brought about. A weaver cannot apply
      himself entirely to his peculiar business, unless there is before-hand
      stored up somewhere, either in his own possession, or in that of some
      other person, a stock sufficient to maintain him, and to supply him with
      the materials and tools of his work, till he has not only completed, but
      sold his web. This accumulation must evidently be previous to his applying
      his industry for so long a time to such a peculiar business.

      As the accumulation of stock must, in the nature of things, be previous to
      the division of labour, so labour can be more and more subdivided in
      proportion only as stock is previously more and more accumulated. The
      quantity of materials which the same number of people can work up,
      increases in a great proportion as labour comes to be more and more
      subdivided; and as the operations of each workman are gradually reduced to
      a greater degree of simplicity, a variety of new machines come to be
      invented for facilitating and abridging those operations. As the division
      of labour advances, therefore, in order to give constant employment to an
      equal number of workmen, an equal stock of provisions, and a greater stock
      of materials and tools than what would have been necessary in a ruder
      state of things, must be accumulated before-hand. But the number of
      workmen in every branch of business generally increases with the division
      of labour in that branch; or rather it is the increase of their number
      which enables them to class and subdivide themselves in this manner.

      As the accumulation of stock is previously necessary for carrying on this
      great improvement in the productive powers of labour, so that accumulation
      naturally leads to this improvement. The person who employs his stock in
      maintaining labour, necessarily wishes to employ it in such a manner as to
      produce as great a quantity of work as possible. He endeavours, therefore,
      both to make among his workmen the most proper distribution of employment,
      and to furnish them with the best machines which he can either invent or
      afford to purchase. His abilities, in both these respects, are generally
      in proportion to the extent of his stock, or to the number of people whom
      it can employ. The quantity of industry, therefore, not only increases in
      every country with the increase of the stock which employs it, but, in
      consequence of that increase, the same quantity of industry produces a
      much greater quantity of work.

      Such are in general the effects of the increase of stock upon industry and
      its productive powers.

      In the following book, I have endeavoured to explain the nature of stock,
      the effects of its accumulation into capital of different kinds, and the
      effects of the different employments of those capitals. This book is
      divided into five chapters. In the first chapter, I have endeavoured to
      shew what are the different parts or branches into which the stock, either
      of an individual, or of a great society, naturally divides itself. In the
      second, I have endeavoured to explain the nature and operation of money,
      considered as a particular branch of the general stock of the society. The
      stock which is accumulated into a capital, may either be employed by the
      person to whom it belongs, or it may be lent to some other person. In the
      third and fourth chapters, I have endeavoured to examine the manner in
      which it operates in both these situations. The fifth and last chapter
      treats of the different effects which the different employments of capital
      immediately produce upon the quantity, both of national industry, and of
      the annual produce of land and labour.
