1733 lines
81 KiB
Markdown
1733 lines
81 KiB
Markdown
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# Extract Economic Entities
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You are an analytical economist specializing in classical economic theory.
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Your task is to extract distinct economic entities from a chapter of
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Adam Smith's *The Wealth of Nations*.
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## Source Chapter
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---
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id: book-4-chapter-02
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title: "OF RESTRAINTS UPON IMPORTATION FROM FOREIGN COUNTRIES OF SUCH GOODS AS CAN BE PRODUCED AT HOME."
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book: "4"
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chapter: 2
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artifact_type: content
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---
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CHAPTER II.
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OF RESTRAINTS UPON IMPORTATION FROM
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FOREIGN COUNTRIES OF SUCH GOODS AS CAN BE PRODUCED AT HOME.
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By restraining, either by high duties, or by absolute prohibitions, the
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importation of such goods from foreign countries as can be produced at
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home, the monopoly of the home market is more or less secured to the
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domestic industry employed in producing them. Thus the prohibition of
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importing either live cattle or salt provisions from foreign countries,
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secures to the graziers of Great Britain the monopoly of the home market
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for butcher’s meat. The high duties upon the importation of corn, which,
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in times of moderate plenty, amount to a prohibition, give a like
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advantage to the growers of that commodity. The prohibition of the
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importation of foreign woollen is equally favourable to the woollen
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manufacturers. The silk manufacture, though altogether employed upon
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foreign materials, has lately obtained the same advantage. The linen
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manufacture has not yet obtained it, but is making great strides towards
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it. Many other sorts of manufactures have, in the same manner obtained in
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Great Britain, either altogether, or very nearly, a monopoly against their
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countrymen. The variety of goods, of which the importation into Great
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Britain is prohibited, either absolutely, or under certain circumstances,
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greatly exceeds what can easily be suspected by those who are not well
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acquainted with the laws of the customs.
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That this monopoly of the home market frequently gives great encouragement
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to that particular species of industry which enjoys it, and frequently
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turns towards that employment a greater share of both the labour and stock
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of the society than would otherwise have gone to it, cannot be doubted.
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But whether it tends either to increase the general industry of the
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society, or to give it the most advantageous direction, is not, perhaps,
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altogether so evident.
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The general industry of the society can never exceed what the capital of
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the society can employ. As the number of workmen that can be kept in
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employment by any particular person must bear a certain proportion to his
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capital, so the number of those that can be continually employed by all
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the members of a great society must bear a certain proportion to the whole
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capital of the society, and never can exceed that proportion. No
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regulation of commerce can increase the quantity of industry in any
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society beyond what its capital can maintain. It can only divert a part of
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it into a direction into which it might not otherwise have gone; and it is
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by no means certain that this artificial direction is likely to be more
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advantageous to the society, than that into which it would have gone of
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its own accord.
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Every individual is continually exerting himself to find out the most
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advantageous employment for whatever capital he can command. It is his own
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advantage, indeed, and not that of the society, which he has in view. But
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the study of his own advantage naturally, or rather necessarily, leads him
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to prefer that employment which is most advantageous to the society.
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First, every individual endeavours to employ his capital as near home as
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he can, and consequently as much as he can in the support of domestic
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industry, provided always that he can thereby obtain the ordinary, or not
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a great deal less than the ordinary profits of stock.
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Thus, upon equal, or nearly equal profits, every wholesale merchant
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naturally prefers the home trade to the foreign trade of consumption, and
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the foreign trade of consumption to the carrying trade. In the home trade,
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his capital is never so long out of his sight as it frequently is in the
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foreign trade of consumption. He can know better the character and
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situation of the persons whom he trusts; and if he should happen to be
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deceived, he knows better the laws of the country from which he must seek
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redress. In the carrying trade, the capital of the merchant is, as it
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were, divided between two foreign countries, and no part of it is ever
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necessarily brought home, or placed under his own immediate view and
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command. The capital which an Amsterdam merchant employs in carrying corn
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from Koningsberg to Lisbon, and fruit and wine from Lisbon to Koningsberg,
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must generally be the one half of it at Koningsberg, and the other half at
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Lisbon. No part of it need ever come to Amsterdam. The natural residence
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of such a merchant should either be at Koningsberg or Lisbon; and it can
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only be some very particular circumstances which can make him prefer the
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residence of Amsterdam. The uneasiness, however, which he feels at being
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separated so far from his capital, generally determines him to bring part
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both of the Koningsberg goods which he destines for the market of Lisbon,
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and of the Lisbon goods which he destines for that of Koningsberg, to
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Amsterdam; and though this necessarily subjects him to a double charge of
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loading and unloading as well as to the payment of some duties and
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customs, yet, for the sake of having some part of his capital always under
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his own view and command, he willingly submits to this extraordinary
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charge; and it is in this manner that every country which has any
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considerable share of the carrying trade, becomes always the emporium, or
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general market, for the goods of all the different countries whose trade
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it carries on. The merchant, in order to save a second loading and
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unloading, endeavours always to sell in the home market, as much of the
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goods of all those different countries as he can; and thus, so far as he
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can, to convert his carrying trade into a foreign trade of consumption. A
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merchant, in the same manner, who is engaged in the foreign trade of
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consumption, when he collects goods for foreign markets, will always be
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glad, upon equal or nearly equal profits, to sell as great a part of them
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at home as he can. He saves himself the risk and trouble of exportation,
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when, so far as he can, he thus converts his foreign trade of consumption
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into a home trade. Home is in this manner the centre, if I may say so,
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round which the capitals of the inhabitants of every country are
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continually circulating, and towards which they are always tending,
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though, by particular causes, they may sometimes be driven off and
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repelled from it towards more distant employments. But a capital employed
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in the home trade, it has already been shown, necessarily puts into motion
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a greater quantity of domestic industry, and gives revenue and employment
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to a greater number of the inhabitants of the country, than an equal
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capital employed in the foreign trade of consumption; and one employed in
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the foreign trade of consumption has the same advantage over an equal
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capital employed in the carrying trade. Upon equal, or only nearly equal
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profits, therefore, every individual naturally inclines to employ his
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capital in the manner in which it is likely to afford the greatest support
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to domestic industry, and to give revenue and employment to the greatest
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number of people of his own country.
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Secondly, every individual who employs his capital in the support of
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domestic industry, necessarily endeavours so to direct that industry, that
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its produce may be of the greatest possible value.
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The produce of industry is what it adds to the subject or materials upon
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which it is employed. In proportion as the value of this produce is great
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or small, so will likewise be the profits of the employer. But it is only
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for the sake of profit that any man employs a capital in the support of
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industry; and he will always, therefore, endeavour to employ it in the
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support of that industry of which the produce is likely to be of the
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greatest value, or to exchange for the greatest quantity either of money
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or of other goods.
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But the annual revenue of every society is always precisely equal to the
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exchangeable value of the whole annual produce of its industry, or rather
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is precisely the same thing with that exchangeable value. As every
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individual, therefore, endeavours as much as he can, both to employ his
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capital in the support of domestic industry, and so to direct that
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industry that its produce maybe of the greatest value; every individual
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necessarily labours to render the annual revenue of the society as great
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as he can. He generally, indeed, neither intends to promote the public
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interest, nor knows how much he is promoting it. By preferring the support
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of domestic to that of foreign industry, he intends only his own security;
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and by directing that industry in such a manner as its produce may be of
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the greatest value, he intends only his own gain; and he is in this, as in
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many other cases, led by an invisible hand to promote an end which was no
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part of his intention. Nor is it always the worse for the society that it
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was no part of it. By pursuing his own interest, he frequently promotes
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that of the society more effectually than when he really intends to
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promote it. I have never known much good done by those who affected to
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trade for the public good. It is an affectation, indeed, not very common
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among merchants, and very few words need be employed in dissuading them
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from it.
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What is the species of domestic industry which his capital can employ, and
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of which the produce is likely to be of the greatest value, every
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individual, it is evident, can in his local situation judge much better
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than any statesman or lawgiver can do for him. The statesman, who should
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attempt to direct private people in what manner they ought to employ their
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capitals, would not only load himself with a most unnecessary attention,
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but assume an authority which could safely be trusted, not only to no
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single person, but to no council or senate whatever, and which would
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nowhere be so dangerous as in the hands of a man who had folly and
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presumption enough to fancy himself fit to exercise it.
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To give the monopoly of the home market to the produce of domestic
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industry, in any particular art or manufacture, is in some measure to
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direct private people in what manner they ought to employ their capitals,
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and must in almost all cases be either a useless or a hurtful regulation.
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If the produce of domestic can be brought there as cheap as that of
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foreign industry, the regulation is evidently useless. If it cannot, it
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must generally be hurtful. It is the maxim of every prudent master of a
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family, never to attempt to make at home what it will cost him more to
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make than to buy. The tailor does not attempt to make his own shoes, but
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buys them of the shoemaker. The shoemaker does not attempt to make his own
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clothes, but employs a tailor. The farmer attempts to make neither the one
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nor the other, but employs those different artificers. All of them find it
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for their interest to employ their whole industry in a way in which they
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have some advantage over their neighbours, and to purchase with a part of
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its produce, or, what is the same thing, with the price of a part of it,
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whatever else they have occasion for.
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What is prudence in the conduct of every private family, can scarce be
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folly in that of a great kingdom. If a foreign country can supply us with
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a commodity cheaper than we ourselves can make it, better buy it of them
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with some part of the produce of our own industry, employed in a way in
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which we have some advantage. The general industry of the country being
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always in proportion to the capital which employs it, will not thereby be
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diminished, no more than that of the abovementioned artificers; but only
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left to find out the way in which it can be employed with the greatest
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advantage. It is certainly not employed to the greatest advantage, when it
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is thus directed towards an object which it can buy cheaper than it can
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make. The value of its annual produce is certainly more or less
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diminished, when it is thus turned away from producing commodities
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evidently of more value than the commodity which it is directed to
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produce. According to the supposition, that commodity could be purchased
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from foreign countries cheaper than it can be made at home; it could
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therefore have been purchased with a part only of the commodities, or,
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what is the same thing, with a part only of the price of the commodities,
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which the industry employed by an equal capital would have produced at
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home, had it been left to follow its natural course. The industry of the
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country, therefore, is thus turned away from a more to a less advantageous
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employment; and the exchangeable value of its annual produce, instead of
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being increased, according to the intention of the lawgiver, must
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necessarily be diminished by every such regulation.
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By means of such regulations, indeed, a particular manufacture may
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sometimes be acquired sooner than it could have been otherwise, and after
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a certain time may be made at home as cheap, or cheaper, than in the
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foreign country. But though the industry of the society may be thus
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carried with advantage into a particular channel sooner than it could have
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been otherwise, it will by no means follow that the sum-total, either of
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its industry, or of its revenue, can ever be augmented by any such
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regulation. The industry of the society can augment only in proportion as
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its capital augments, and its capital can augment only in proportion to
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what can be gradually saved out of its revenue. But the immediate effect
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of every such regulation is to diminish its revenue; and what diminishes
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its revenue is certainly not very likely to augment its capital faster
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than it would have augmented of its own accord, had both capital and
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industry been left to find out their natural employments.
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Though, for want of such regulations, the society should never acquire the
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proposed manufacture, it would not upon that account necessarily be the
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poorer in anyone period of its duration. In every period of its duration
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its whole capital and industry might still have been employed, though upon
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different objects, in the manner that was most advantageous at the time.
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In every period its revenue might have been the greatest which its capital
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could afford, and both capital and revenue might have been augmented with
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the greatest possible rapidity.
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The natural advantages which one country has over another, in producing
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particular commodities, are sometimes so great, that it is acknowledged by
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all the world to be in vain to struggle with them. By means of glasses,
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hot-beds, and hot-walls, very good grapes can be raised in Scotland, and
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very good wine, too, can be made of them, at about thirty times the
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expense for which at least equally good can be brought from foreign
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countries. Would it be a reasonable law to prohibit the importation of all
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foreign wines, merely to encourage the making of claret and Burgundy in
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Scotland? But if there would be a manifest absurdity in turning towards
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any employment thirty times more of the capital and industry of the
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country than would be necessary to purchase from foreign countries an
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equal quantity of the commodities wanted, there must be an absurdity,
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though not altogether so glaring, yet exactly of the same kind, in turning
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towards any such employment a thirtieth, or even a three hundredth part
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more of either. Whether the advantages which one country has over another
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be natural or acquired, is in this respect of no consequence. As long as
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the one country has those advantages, and the other wants them, it will
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always be more advantageous for the latter rather to buy of the former
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than to make. It is an acquired advantage only, which one artificer has
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over his neighbour, who exercises another trade; and yet they both find it
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more advantageous to buy of one another, than to make what does not belong
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to their particular trades.
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Merchants and manufacturers are the people who derive the greatest
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advantage from this monopoly of the home market. The prohibition of the
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importation of foreign cattle and of salt provisions, together with the
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high duties upon foreign corn, which in times of moderate plenty amount to
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a prohibition, are not near so advantageous to the graziers and farmers of
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Great Britain, as other regulations of the same kind are to its merchants
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and manufacturers. Manufactures, those of the finer kind especially, are
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more easily transported from one country to another than corn or cattle.
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It is in the fetching and carrying manufactures, accordingly, that foreign
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trade is chiefly employed. In manufactures, a very small advantage will
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enable foreigners to undersell our own workmen, even in the home market.
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It will require a very great one to enable them to do so in the rude
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produce of the soil. If the free importation of foreign manufactures were
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permitted, several of the home manufactures would probably suffer, and
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some of them perhaps go to ruin altogether, and a considerable part of the
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stock and industry at present employed in them, would be forced to find
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out some other employment. But the freest importation of the rude produce
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of the soil could have no such effect upon the agriculture of the country.
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If the importation of foreign cattle, for example, were made ever so free,
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so few could be imported, that the grazing trade of Great Britain could be
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little affected by it. Live cattle are, perhaps, the only commodity of
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which the transportation is more expensive by sea than by land. By land
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they carry themselves to market. By sea, not only the cattle, but their
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food and their water too, must be carried at no small expense and
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inconveniency. The short sea between Ireland and Great Britain, indeed,
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renders the importation of Irish cattle more easy. But though the free
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importation of them, which was lately permitted only for a limited time,
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were rendered perpetual, it could have no considerable effect upon the
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interest of the graziers of Great Britain. Those parts of Great Britain
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which border upon the Irish sea are all grazing countries. Irish cattle
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could never be imported for their use, but must be drove through those
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very extensive countries, at no small expense and inconveniency, before
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they could arrive at their proper market. Fat cattle could not be drove so
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far. Lean cattle, therefore, could only be imported; and such importation
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could interfere not with the interest of the feeding or fattening
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|
|
countries, to which, by reducing the price of lean cattle it would rather
|
|||
|
|
be advantageous, but with that of the breeding countries only. The small
|
|||
|
|
number of Irish cattle imported since their importation was permitted,
|
|||
|
|
together with the good price at which lean cattle still continue to sell,
|
|||
|
|
seem to demonstrate, that even the breeding countries of Great Britain are
|
|||
|
|
never likely to be much affected by the free importation of Irish cattle.
|
|||
|
|
The common people of Ireland, indeed, are said to have sometimes opposed
|
|||
|
|
with violence the exportation of their cattle. But if the exporters had
|
|||
|
|
found any great advantage in continuing the trade, they could easily, when
|
|||
|
|
the law was on their side, have conquered this mobbish opposition.
|
|||
|
|
|
|||
|
|
Feeding and fattening countries, besides, must always be highly improved,
|
|||
|
|
whereas breeding countries are generally uncultivated. The high price of
|
|||
|
|
lean cattle, by augmenting the value of uncultivated land, is like a
|
|||
|
|
bounty against improvement. To any country which was highly improved
|
|||
|
|
throughout, it would be more advantageous to import its lean cattle than
|
|||
|
|
to breed them. The province of Holland, accordingly, is said to follow
|
|||
|
|
this maxim at present. The mountains of Scotland, Wales, and
|
|||
|
|
Northumberland, indeed, are countries not capable of much improvement, and
|
|||
|
|
seem destined by nature to be the breeding countries of Great Britain. The
|
|||
|
|
freest importation of foreign cattle could have no other effect than to
|
|||
|
|
hinder those breeding countries from taking advantage of the increasing
|
|||
|
|
population and improvement of the rest of the kingdom, from raising their
|
|||
|
|
price to an exorbitant height, and from laying a real tax upon all the
|
|||
|
|
more improved and cultivated parts of the country.
|
|||
|
|
|
|||
|
|
The freest importation of salt provisions, in the same manner, could have
|
|||
|
|
as little effect upon the interest of the graziers of Great Britain as
|
|||
|
|
that of live cattle. Salt provisions are not only a very bulky commodity,
|
|||
|
|
but when compared with fresh meat they are a commodity both of worse
|
|||
|
|
quality, and, as they cost more labour and expense, of higher price. They
|
|||
|
|
could never, therefore, come into competition with the fresh meat, though
|
|||
|
|
they might with the salt provisions of the country. They might be used for
|
|||
|
|
victualling ships for distant voyages, and such like uses, but could never
|
|||
|
|
make any considerable part of the food of the people. The small quantity
|
|||
|
|
of salt provisions imported from Ireland since their importation was
|
|||
|
|
rendered free, is an experimental proof that our graziers have nothing to
|
|||
|
|
apprehend from it. It does not appear that the price of butcher’s meat has
|
|||
|
|
ever been sensibly affected by it.
|
|||
|
|
|
|||
|
|
Even the free importation of foreign corn could very little affect the
|
|||
|
|
interest of the farmers of Great Britain. Corn is a much more bulky
|
|||
|
|
commodity than butcher’s meat. A pound of wheat at a penny is as dear as a
|
|||
|
|
pound of butcher’s meat at fourpence. The small quantity of foreign corn
|
|||
|
|
imported even in times of the greatest scarcity, may satisfy our farmers
|
|||
|
|
that they can have nothing to fear from the freest importation. The
|
|||
|
|
average quantity imported, one year with another, amounts only, according
|
|||
|
|
to the very well informed author of the Tracts upon the Corn Trade, to
|
|||
|
|
23,728 quarters of all sorts of grain, and does not exceed the five
|
|||
|
|
hundredth and seventy-one part of the annual consumption. But as the
|
|||
|
|
bounty upon corn occasions a greater exportation in years of plenty, so it
|
|||
|
|
must, of consequence, occasion a greater importation in years of scarcity,
|
|||
|
|
than in the actual state of tillage would otherwise take place. By means
|
|||
|
|
of it, the plenty of one year does not compensate the scarcity of another;
|
|||
|
|
and as the average quantity exported is necessarily augmented by it, so
|
|||
|
|
must likewise, in the actual state of tillage, the average quantity
|
|||
|
|
imported. If there were no bounty, as less corn would be exported, so it
|
|||
|
|
is probable that, one year with another, less would be imported than at
|
|||
|
|
present. The corn-merchants, the fetchers and carriers of corn between
|
|||
|
|
Great Britain and foreign countries, would have much less employment, and
|
|||
|
|
might suffer considerably; but the country gentlemen and farmers could
|
|||
|
|
suffer very little. It is in the corn-merchants, accordingly, rather than
|
|||
|
|
the country gentlemen and farmers, that I have observed the greatest
|
|||
|
|
anxiety for the renewal and continuation of the bounty.
|
|||
|
|
|
|||
|
|
Country gentlemen and farmers are, to their great honour, of all people,
|
|||
|
|
the least subject to the wretched spirit of monopoly. The undertaker of a
|
|||
|
|
great manufactory is sometimes alarmed if another work of the same kind is
|
|||
|
|
established within twenty miles of him; the Dutch undertaker of the
|
|||
|
|
woollen manufacture at Abbeville, stipulated that no work of the same kind
|
|||
|
|
should be established within thirty leagues of that city. Farmers and
|
|||
|
|
country gentlemen, on the contrary, are generally disposed rather to
|
|||
|
|
promote, than to obstruct, the cultivation and improvement of their
|
|||
|
|
neighbours farms and estates. They have no secrets, such as those of the
|
|||
|
|
greater part of manufacturers, but are generally rather fond of
|
|||
|
|
communicating to their neighbours, and of extending as far as possible any
|
|||
|
|
new practice which they may have found to be advantageous. “Pius
|
|||
|
|
quaestus”, says old Cato, “stabilissimusque, minimeque invidiosus;
|
|||
|
|
minimeque male cogitantes sunt, qui in eo studio occupati sunt.” Country
|
|||
|
|
gentlemen and farmers, dispersed in different parts of the country, cannot
|
|||
|
|
so easily combine as merchants and manufacturers, who being collected into
|
|||
|
|
towns, and accustomed to that exclusive corporation spirit which prevails
|
|||
|
|
in them, naturally endeavour to obtain, against all their countrymen, the
|
|||
|
|
same exclusive privilege which they generally possess against the
|
|||
|
|
inhabitants of their respective towns. They accordingly seem to have been
|
|||
|
|
the original inventors of those restraints upon the importation of foreign
|
|||
|
|
goods, which secure to them the monopoly of the home market. It was
|
|||
|
|
probably in imitation of them, and to put themselves upon a level with
|
|||
|
|
those who, they found, were disposed to oppress them, that the country
|
|||
|
|
gentlemen and farmers of Great Britain so far forgot the generosity which
|
|||
|
|
is natural to their station, as to demand the exclusive privilege of
|
|||
|
|
supplying their countrymen with corn and butcher’s meat. They did not,
|
|||
|
|
perhaps, take time to consider how much less their interest could be
|
|||
|
|
affected by the freedom of trade, than that of the people whose example
|
|||
|
|
they followed.
|
|||
|
|
|
|||
|
|
To prohibit, by a perpetual law, the importation of foreign corn and
|
|||
|
|
cattle, is in reality to enact, that the population and industry of the
|
|||
|
|
country shall, at no time, exceed what the rude produce of its own soil
|
|||
|
|
can maintain.
|
|||
|
|
|
|||
|
|
There seem, however, to be two cases, in which it will generally be
|
|||
|
|
advantageous to lay some burden upon foreign, for the encouragement of
|
|||
|
|
domestic industry.
|
|||
|
|
|
|||
|
|
The first is, when some particular sort of industry is necessary for the
|
|||
|
|
defence of the country. The defence of Great Britain, for example, depends
|
|||
|
|
very much upon the number of its sailors and shipping. The act of
|
|||
|
|
navigation, therefore, very properly endeavours to give the sailors and
|
|||
|
|
shipping of Great Britain the monopoly of the trade of their own country,
|
|||
|
|
in some cases, by absolute prohibitions, and in others, by heavy burdens
|
|||
|
|
upon the shipping of foreign countries. The following are the principal
|
|||
|
|
dispositions of this act.
|
|||
|
|
|
|||
|
|
First, All ships, of which the owners, masters, and three-fourths of the
|
|||
|
|
mariners, are not British subjects, are prohibited, upon pain of
|
|||
|
|
forfeiting ship and cargo, from trading to the British settlements and
|
|||
|
|
plantations, or from being employed in the coasting trade of Great
|
|||
|
|
Britain.
|
|||
|
|
|
|||
|
|
Secondly, A great variety of the most bulky articles of importation can be
|
|||
|
|
brought into Great Britain only, either in such ships as are above
|
|||
|
|
described, or in ships of the country where those goods are produced, and
|
|||
|
|
of which the owners, masters, and three-fourths of the mariners, are of
|
|||
|
|
that particular country; and when imported even in ships of this latter
|
|||
|
|
kind, they are subject to double aliens duty. If imported in ships of any
|
|||
|
|
other country, the penalty is forfeiture of ship and goods. When this act
|
|||
|
|
was made, the Dutch were, what they still are, the great carriers of
|
|||
|
|
Europe; and by this regulation they were entirely excluded from being the
|
|||
|
|
carriers to Great Britain, or from importing to us the goods of any other
|
|||
|
|
European country.
|
|||
|
|
|
|||
|
|
Thirdly, A great variety of the most bulky articles of importation are
|
|||
|
|
prohibited from being imported, even in British ships, from any country
|
|||
|
|
but that in which they are produced, under pain of forfeiting ship and
|
|||
|
|
cargo. This regulation, too, was probably intended against the Dutch.
|
|||
|
|
Holland was then, as now, the great emporium for all European goods; and
|
|||
|
|
by this regulation, British ships were hindered from loading in Holland
|
|||
|
|
the goods of any other European country.
|
|||
|
|
|
|||
|
|
Fourthly, Salt fish of all kinds, whale fins, whalebone, oil, and blubber,
|
|||
|
|
not caught by and cured on board British vessels, when imported into Great
|
|||
|
|
Britain, are subject to double aliens duty. The Dutch, as they are still
|
|||
|
|
the principal, were then the only fishers in Europe that attempted to
|
|||
|
|
supply foreign nations with fish. By this regulation, a very heavy burden
|
|||
|
|
was laid upon their supplying Great Britain.
|
|||
|
|
|
|||
|
|
When the act of navigation was made, though England and Holland were not
|
|||
|
|
actually at war, the most violent animosity subsisted between the two
|
|||
|
|
nations. It had begun during the government of the long parliament, which
|
|||
|
|
first framed this act, and it broke out soon after in the Dutch wars,
|
|||
|
|
during that of the Protector and of Charles II. It is not impossible,
|
|||
|
|
therefore, that some of the regulations of this famous act may have
|
|||
|
|
proceeded from national animosity. They are as wise, however, as if they
|
|||
|
|
had all been dictated by the most deliberate wisdom. National animosity,
|
|||
|
|
at that particular time, aimed at the very same object which the most
|
|||
|
|
deliberate wisdom would have recommended, the diminution of the naval
|
|||
|
|
power of Holland, the only naval power which could endanger the security
|
|||
|
|
of England.
|
|||
|
|
|
|||
|
|
The act of navigation is not favourable to foreign commerce, or to the
|
|||
|
|
growth of that opulence which can arise from it. The interest of a nation,
|
|||
|
|
in its commercial relations to foreign nations, is, like that of a
|
|||
|
|
merchant with regard to the different people with whom he deals, to buy as
|
|||
|
|
cheap, and to sell as dear as possible. But it will be most likely to buy
|
|||
|
|
cheap, when, by the most perfect freedom of trade, it encourages all
|
|||
|
|
nations to bring to it the goods which it has occasion to purchase; and,
|
|||
|
|
for the same reason, it will be most likely to sell dear, when its markets
|
|||
|
|
are thus filled with the greatest number of buyers. The act of navigation,
|
|||
|
|
it is true, lays no burden upon foreign ships that come to export the
|
|||
|
|
produce of British industry. Even the ancient aliens duty, which used to
|
|||
|
|
be paid upon all goods, exported as well as imported, has, by several
|
|||
|
|
subsequent acts, been taken off from the greater part of the articles of
|
|||
|
|
exportation. But if foreigners, either by prohibitions or high duties, are
|
|||
|
|
hindered from coming to sell, they cannot always afford to come to buy;
|
|||
|
|
because, coming without a cargo, they must lose the freight from their own
|
|||
|
|
country to Great Britain. By diminishing the number of sellers, therefore,
|
|||
|
|
we necessarily diminish that of buyers, and are thus likely not only to
|
|||
|
|
buy foreign goods dearer, but to sell our own cheaper, than if there was a
|
|||
|
|
more perfect freedom of trade. As defence, however, is of much more
|
|||
|
|
importance than opulence, the act of navigation is, perhaps, the wisest of
|
|||
|
|
all the commercial regulations of England.
|
|||
|
|
|
|||
|
|
The second case, in which it will generally be advantageous to lay some
|
|||
|
|
burden upon foreign for the encouragement of domestic industry, is when
|
|||
|
|
some tax is imposed at home upon the produce of the latter. In this case,
|
|||
|
|
it seems reasonable that an equal tax should be imposed upon the like
|
|||
|
|
produce of the former. This would not give the monopoly of the home
|
|||
|
|
market to domestic industry, nor turn towards a particular employment a
|
|||
|
|
greater share of the stock and labour of the country, than what would
|
|||
|
|
naturally go to it. It would only hinder any part of what would naturally
|
|||
|
|
go to it from being turned away by the tax into a less natural direction,
|
|||
|
|
and would leave the competition between foreign and domestic industry,
|
|||
|
|
after the tax, as nearly as possible upon the same footing as before it.
|
|||
|
|
In Great Britain, when any such tax is laid upon the produce of domestic
|
|||
|
|
industry, it is usual, at the same time, in order to stop the clamorous
|
|||
|
|
complaints of our merchants and manufacturers, that they will be undersold
|
|||
|
|
at home, to lay a much heavier duty upon the importation of all foreign
|
|||
|
|
goods of the same kind.
|
|||
|
|
|
|||
|
|
This second limitation of the freedom of trade, according to some people,
|
|||
|
|
should, upon most occasions, be extended much farther than to the precise
|
|||
|
|
foreign commodities which could come into competition with those which had
|
|||
|
|
been taxed at home. When the necessaries of life have been taxed in any
|
|||
|
|
country, it becomes proper, they pretend, to tax not only the like
|
|||
|
|
necessaries of life imported from other countries, but all sorts of
|
|||
|
|
foreign goods which can come into competition with any thing that is the
|
|||
|
|
produce of domestic industry. Subsistence, they say, becomes necessarily
|
|||
|
|
dearer in consequence of such taxes; and the price of labour must always
|
|||
|
|
rise with the price of the labourer’s subsistence. Every commodity,
|
|||
|
|
therefore, which is the produce of domestic industry, though not
|
|||
|
|
immediately taxed itself, becomes dearer in consequence of such taxes,
|
|||
|
|
because the labour which produces it becomes so. Such taxes, therefore,
|
|||
|
|
are really equivalent, they say, to a tax upon every particular commodity
|
|||
|
|
produced at home. In order to put domestic upon the same footing with
|
|||
|
|
foreign industry, therefore, it becomes necessary, they think, to lay some
|
|||
|
|
duty upon every foreign commodity, equal to this enhancement of the price
|
|||
|
|
of the home commodities with which it can come into competition.
|
|||
|
|
|
|||
|
|
Whether taxes upon the necessaries of life, such as those in Great Britain
|
|||
|
|
upon soap, salt, leather, candles, etc. necessarily raise the price of
|
|||
|
|
labour, and consequently that of all other commodities, I shall consider
|
|||
|
|
hereafter, when I come to treat of taxes. Supposing, however, in the mean
|
|||
|
|
time, that they have this effect, and they have it undoubtedly, this
|
|||
|
|
general enhancement of the price of all commodities, in consequence of
|
|||
|
|
that labour, is a case which differs in the two following respects from
|
|||
|
|
that of a particular commodity, of which the price was enhanced by a
|
|||
|
|
particular tax immediately imposed upon it.
|
|||
|
|
|
|||
|
|
First, It might always be known with great exactness, how far the price of
|
|||
|
|
such a commodity could be enhanced by such a tax; but how far the general
|
|||
|
|
enhancement of the price of labour might affect that of every different
|
|||
|
|
commodity about which labour was employed, could never be known with any
|
|||
|
|
tolerable exactness. It would be impossible, therefore, to proportion,
|
|||
|
|
with any tolerable exactness, the tax of every foreign, to the enhancement
|
|||
|
|
of the price of every home commodity.
|
|||
|
|
|
|||
|
|
Secondly, Taxes upon the necessaries of life have nearly the same effect
|
|||
|
|
upon the circumstances of the people as a poor soil and a bad climate.
|
|||
|
|
Provisions are thereby rendered dearer, in the same manner as if it
|
|||
|
|
required extraordinary labour and expense to raise them. As, in the
|
|||
|
|
natural scarcity arising from soil and climate, it would be absurd to
|
|||
|
|
direct the people in what manner they ought to employ their capitals and
|
|||
|
|
industry, so is it likewise in the artificial scarcity arising from such
|
|||
|
|
taxes. To be left to accommodate, as well as they could, their industry to
|
|||
|
|
their situation, and to find out those employments in which,
|
|||
|
|
notwithstanding their unfavourable circumstances, they might have some
|
|||
|
|
advantage either in the home or in the foreign market, is what, in both
|
|||
|
|
cases, would evidently be most for their advantage. To lay a new-tax upon
|
|||
|
|
them, because they are already overburdened with taxes, and because they
|
|||
|
|
already pay too dear for the necessaries of life, to make them likewise
|
|||
|
|
pay too dear for the greater part of other commodities, is certainly a
|
|||
|
|
most absurd way of making amends.
|
|||
|
|
|
|||
|
|
Such taxes, when they have grown up to a certain height, are a curse equal
|
|||
|
|
to the barrenness of the earth, and the inclemency of the heavens, and yet
|
|||
|
|
it is in the richest and most industrious countries that they have been
|
|||
|
|
most generally imposed. No other countries could support so great a
|
|||
|
|
disorder. As the strongest bodies only can live and enjoy health under an
|
|||
|
|
unwholesome regimen, so the nations only, that in every sort of industry
|
|||
|
|
have the greatest natural and acquired advantages, can subsist and prosper
|
|||
|
|
under such taxes. Holland is the country in Europe in which they abound
|
|||
|
|
most, and which, from peculiar circumstances, continues to prosper, not by
|
|||
|
|
means of them, as has been most absurdly supposed, but in spite of them.
|
|||
|
|
|
|||
|
|
As there are two cases in which it will generally be advantageous to lay
|
|||
|
|
some burden upon foreign for the encouragement of domestic industry, so
|
|||
|
|
there are two others in which it may sometimes be a matter of
|
|||
|
|
deliberation, in the one, how far it is proper to continue the free
|
|||
|
|
importation of certain foreign goods; and, in the other, how far, or in
|
|||
|
|
what manner, it may be proper to restore that free importation, after it
|
|||
|
|
has been for some time interrupted.
|
|||
|
|
|
|||
|
|
The case in which it may sometimes be a matter of deliberation how far it
|
|||
|
|
is proper to continue the free importation of certain foreign goods, is
|
|||
|
|
when some foreign nation restrains, by high duties or prohibitions, the
|
|||
|
|
importation of some of our manufactures into their country. Revenge, in
|
|||
|
|
this case, naturally dictates retaliation, and that we should impose the
|
|||
|
|
like duties and prohibitions upon the importation of some or all of their
|
|||
|
|
manufactures into ours. Nations, accordingly, seldom fail to retaliate in
|
|||
|
|
this manner. The French have been particularly forward to favour their own
|
|||
|
|
manufactures, by restraining the importation of such foreign goods as
|
|||
|
|
could come into competition with them. In this consisted a great part of
|
|||
|
|
the policy of Mr Colbert, who, notwithstanding his great abilities, seems
|
|||
|
|
in this case to have been imposed upon by the sophistry of merchants and
|
|||
|
|
manufacturers, who are always demanding a monopoly against their
|
|||
|
|
countrymen. It is at present the opinion of the most intelligent men in
|
|||
|
|
France, that his operations of this kind have not been beneficial to his
|
|||
|
|
country. That minister, by the tariff of 1667, imposed very high duties
|
|||
|
|
upon a great number of foreign manufactures. Upon his refusing to moderate
|
|||
|
|
them in favour of the Dutch, they, in 1671, prohibited the importation of
|
|||
|
|
the wines, brandies, and manufactures of France. The war of 1672 seems to
|
|||
|
|
have been in part occasioned by this commercial dispute. The peace of
|
|||
|
|
Nimeguen put an end to it in 1678, by moderating some of those duties in
|
|||
|
|
favour of the Dutch, who in consequence took off their prohibition. It was
|
|||
|
|
about the same time that the French and English began mutually to oppress
|
|||
|
|
each other’s industry, by the like duties and prohibitions, of which the
|
|||
|
|
French, however, seem to have set the first example, The spirit of
|
|||
|
|
hostility which has subsisted between the two nations ever since, has
|
|||
|
|
hitherto hindered them from being moderated on either side. In 1697, the
|
|||
|
|
English prohibited the importation of bone lace, the manufacture of
|
|||
|
|
Flanders. The government of that country, at that time under the dominion
|
|||
|
|
of Spain, prohibited, in return, the importation of English woollens. In
|
|||
|
|
1700, the prohibition of importing bone lace into England was taken off
|
|||
|
|
upon condition that the importation of English woollens into Flanders
|
|||
|
|
should be put on the same footing as before.
|
|||
|
|
|
|||
|
|
There may be good policy in retaliations of this kind, when there is a
|
|||
|
|
probability that they will procure the repeal of the high duties or
|
|||
|
|
prohibitions complained of. The recovery of a great foreign market will
|
|||
|
|
generally more than compensate the transitory inconveniency of paying
|
|||
|
|
dearer during a short time for some sorts of goods. To judge whether such
|
|||
|
|
retaliations are likely to produce such an effect, does not, perhaps,
|
|||
|
|
belong so much to the science of a legislator, whose deliberations ought
|
|||
|
|
to be governed by general principles, which are always the same, as to the
|
|||
|
|
skill of that insidious and crafty animal vulgarly called a statesman or
|
|||
|
|
politician, whose councils are directed by the momentary fluctuations of
|
|||
|
|
affairs. When there is no probability that any such repeal can be
|
|||
|
|
procured, it seems a bad method of compensating the injury done to certain
|
|||
|
|
classes of our people, to do another injury ourselves, not only to those
|
|||
|
|
classes, but to almost all the other classes of them. When our neighbours
|
|||
|
|
prohibit some manufacture of ours, we generally prohibit, not only the
|
|||
|
|
same, for that alone would seldom affect them considerably, but some other
|
|||
|
|
manufacture of theirs. This may, no doubt, give encouragement to some
|
|||
|
|
particular class of workmen among ourselves, and, by excluding some of
|
|||
|
|
their rivals, may enable them to raise their price in the home market.
|
|||
|
|
Those workmen however, who suffered by our neighbours prohibition, will
|
|||
|
|
not be benefited by ours. On the contrary, they, and almost all the other
|
|||
|
|
classes of our citizens, will thereby be obliged to pay dearer than before
|
|||
|
|
for certain goods. Every such law, therefore, imposes a real tax upon the
|
|||
|
|
whole country, not in favour of that particular class of workmen who were
|
|||
|
|
injured by our neighbours prohibitions, but of some other class.
|
|||
|
|
|
|||
|
|
The case in which it may sometimes be a matter of deliberation, how far,
|
|||
|
|
or in what manner, it is proper to restore the free importation of foreign
|
|||
|
|
goods, after it has been for some time interrupted, is when particular
|
|||
|
|
manufactures, by means of high duties or prohibitions upon all foreign
|
|||
|
|
goods which can come into competition with them, have been so far extended
|
|||
|
|
as to employ a great multitude of hands. Humanity may in this case require
|
|||
|
|
that the freedom of trade should be restored only by slow gradations, and
|
|||
|
|
with a good deal of reserve and circumspection. Were those high duties and
|
|||
|
|
prohibitions taken away all at once, cheaper foreign goods of the same
|
|||
|
|
kind might be poured so fast into the home market, as to deprive all at
|
|||
|
|
once many thousands of our people of their ordinary employment and means
|
|||
|
|
of subsistence. The disorder which this would occasion might no doubt be
|
|||
|
|
very considerable. It would in all probability, however, be much less than
|
|||
|
|
is commonly imagined, for the two following reasons.
|
|||
|
|
|
|||
|
|
First, All those manufactures of which any part is commonly exported to
|
|||
|
|
other European countries without a bounty, could be very little affected
|
|||
|
|
by the freest importation of foreign goods. Such manufactures must be sold
|
|||
|
|
as cheap abroad as any other foreign goods of the same quality and kind,
|
|||
|
|
and consequently must be sold cheaper at home. They would still,
|
|||
|
|
therefore, keep possession of the home market; and though a capricious man
|
|||
|
|
of fashion might sometimes prefer foreign wares, merely because they were
|
|||
|
|
foreign, to cheaper and better goods of the same kind that were made at
|
|||
|
|
home, this folly could, from the nature of things, extend to so few, that
|
|||
|
|
it could make no sensible impression upon the general employment of the
|
|||
|
|
people. But a great part of all the different branches of our woollen
|
|||
|
|
manufacture, of our tanned leather, and of our hardware, are annually
|
|||
|
|
exported to other European countries without any bounty, and these are the
|
|||
|
|
manufactures which employ the greatest number of hands. The silk, perhaps,
|
|||
|
|
is the manufacture which would suffer the most by this freedom of trade,
|
|||
|
|
and after it the linen, though the latter much less than the former.
|
|||
|
|
|
|||
|
|
Secondly, Though a great number of people should, by thus restoring the
|
|||
|
|
freedom of trade, be thrown all at once out of their ordinary employment
|
|||
|
|
and common method of subsistence, it would by no means follow that they
|
|||
|
|
would thereby be deprived either of employment or subsistence. By the
|
|||
|
|
reduction of the army and navy at the end of the late war, more than
|
|||
|
|
100,000 soldiers and seamen, a number equal to what is employed in the
|
|||
|
|
greatest manufactures, were all at once thrown out of their ordinary
|
|||
|
|
employment: but though they no doubt suffered some inconveniency, they
|
|||
|
|
were not thereby deprived of all employment and subsistence. The greater
|
|||
|
|
part of the seamen, it is probable, gradually betook themselves to the
|
|||
|
|
merchant service as they could find occasion, and in the mean time both
|
|||
|
|
they and the soldiers were absorbed in the great mass of the people, and
|
|||
|
|
employed in a great variety of occupations. Not only no great convulsion,
|
|||
|
|
but no sensible disorder, arose from so great a change in the situation of
|
|||
|
|
more than 100,000 men, all accustomed to the use of arms, and many of them
|
|||
|
|
to rapine and plunder. The number of vagrants was scarce anywhere sensibly
|
|||
|
|
increased by it; even the wages of labour were not reduced by it in any
|
|||
|
|
occupation, so far as I have been able to learn, except in that of seamen
|
|||
|
|
in the merchant service. But if we compare together the habits of a
|
|||
|
|
soldier and of any sort of manufacturer, we shall find that those of the
|
|||
|
|
latter do not tend so much to disqualify him from being employed in a new
|
|||
|
|
trade, as those of the former from being employed in any. The manufacturer
|
|||
|
|
has always been accustomed to look for his subsistence from his labour
|
|||
|
|
only; the soldier to expect it from his pay. Application and industry have
|
|||
|
|
been familiar to the one; idleness and dissipation to the other. But it is
|
|||
|
|
surely much easier to change the direction of industry from one sort of
|
|||
|
|
labour to another, than to turn idleness and dissipation to any. To the
|
|||
|
|
greater part of manufactures, besides, it has already been observed, there
|
|||
|
|
are other collateral manufactures of so similar a nature, that a workman
|
|||
|
|
can easily transfer his industry from one of them to another. The greater
|
|||
|
|
part of such workmen, too, are occasionally employed in country labour.
|
|||
|
|
The stock which employed them in a particular manufacture before, will
|
|||
|
|
still remain in the country, to employ an equal number of people in some
|
|||
|
|
other way. The capital of the country remaining the same, the demand for
|
|||
|
|
labour will likewise be the same, or very nearly the same, though it may
|
|||
|
|
be exerted in different places, and for different occupations. Soldiers
|
|||
|
|
and seamen, indeed, when discharged from the king’s service, are at
|
|||
|
|
liberty to exercise any trade within any town or place of Great Britain or
|
|||
|
|
Ireland. Let the same natural liberty of exercising what species of
|
|||
|
|
industry they please, be restored to all his Majesty’s subjects, in the
|
|||
|
|
same manner as to soldiers and seamen; that is, break down the exclusive
|
|||
|
|
privileges of corporations, and repeal the statute of apprenticeship, both
|
|||
|
|
which are really encroachments upon natural Liberty, and add to those the
|
|||
|
|
repeal of the law of settlements, so that a poor workman, when thrown out
|
|||
|
|
of employment, either in one trade or in one place, may seek for it in
|
|||
|
|
another trade or in another place, without the fear either of a
|
|||
|
|
prosecution or of a removal; and neither the public nor the individuals
|
|||
|
|
will suffer much more from the occasional disbanding some particular
|
|||
|
|
classes of manufacturers, than from that of the soldiers. Our
|
|||
|
|
manufacturers have no doubt great merit with their country, but they
|
|||
|
|
cannot have more than those who defend it with their blood, nor deserve to
|
|||
|
|
be treated with more delicacy.
|
|||
|
|
|
|||
|
|
To expect, indeed, that the freedom of trade should ever be entirely
|
|||
|
|
restored in Great Britain, is as absurd as to expect that an Oceana or
|
|||
|
|
Utopia should ever be established in it. Not only the prejudices of the
|
|||
|
|
public, but, what is much more unconquerable, the private interests of
|
|||
|
|
many individuals, irresistibly oppose it. Were the officers of the army to
|
|||
|
|
oppose, with the same zeal and unanimity, any reduction in the number of
|
|||
|
|
forces, with which master manufacturers set themselves against every law
|
|||
|
|
that is likely to increase the number of their rivals in the home market;
|
|||
|
|
were the former to animate their soldiers, in the same manner as the
|
|||
|
|
latter inflame their workmen, to attack with violence and outrage the
|
|||
|
|
proposers of any such regulation; to attempt to reduce the army would be
|
|||
|
|
as dangerous as it has now become to attempt to diminish, in any respect,
|
|||
|
|
the monopoly which our manufacturers have obtained against us. This
|
|||
|
|
monopoly has so much increased the number of some particular tribes of
|
|||
|
|
them, that, like an overgrown standing army, they have become formidable
|
|||
|
|
to the government, and, upon many occasions, intimidate the legislature.
|
|||
|
|
The member of parliament who supports every proposal for strengthening
|
|||
|
|
this monopoly, is sure to acquire not only the reputation of understanding
|
|||
|
|
trade, but great popularity and influence with an order of men whose
|
|||
|
|
numbers and wealth render them of great importance. If he opposes them, on
|
|||
|
|
the contrary, and still more, if he has authority enough to be able to
|
|||
|
|
thwart them, neither the most acknowledged probity, nor the highest rank,
|
|||
|
|
nor the greatest public services, can protect him from the most infamous
|
|||
|
|
abuse and detraction, from personal insults, nor sometimes from real
|
|||
|
|
danger, arising from the insolent outrage of furious and disappointed
|
|||
|
|
monopolists.
|
|||
|
|
|
|||
|
|
The undertaker of a great manufacture, who, by the home markets being
|
|||
|
|
suddenly laid open to the competition of foreigners, should be obliged to
|
|||
|
|
abandon his trade, would no doubt suffer very considerably. That part of
|
|||
|
|
his capital which had usually been employed in purchasing materials, and
|
|||
|
|
in paying his workmen, might, without much difficulty, perhaps, find
|
|||
|
|
another employment; but that part of it which was fixed in workhouses, and
|
|||
|
|
in the instruments of trade, could scarce be disposed of without
|
|||
|
|
considerable loss. The equitable regard, therefore, to his interest,
|
|||
|
|
requires that changes of this kind should never be introduced suddenly,
|
|||
|
|
but slowly, gradually, and after a very long warning. The legislature,
|
|||
|
|
were it possible that its deliberations could be always directed, not by
|
|||
|
|
the clamorous importunity of partial interests, but by an extensive view
|
|||
|
|
of the general good, ought, upon this very account, perhaps, to be
|
|||
|
|
particularly careful, neither to establish any new monopolies of this
|
|||
|
|
kind, nor to extend further those which are already established. Every
|
|||
|
|
such regulation introduces some degree of real disorder into the
|
|||
|
|
constitution of the state, which it will be difficult afterwards to cure
|
|||
|
|
without occasioning another disorder.
|
|||
|
|
|
|||
|
|
How far it may be proper to impose taxes upon the importation of foreign
|
|||
|
|
goods, in order not to prevent their importation, but to raise a revenue
|
|||
|
|
for government, I shall consider hereafter when I come to treat of taxes.
|
|||
|
|
Taxes imposed with a view to prevent, or even to diminish importation, are
|
|||
|
|
evidently as destructive of the revenue of the customs as of the freedom
|
|||
|
|
of trade.
|
|||
|
|
|
|||
|
|
|
|||
|
|
## Extraction Guidelines
|
|||
|
|
|
|||
|
|
---
|
|||
|
|
id: extraction-rules
|
|||
|
|
name: extraction_rules
|
|||
|
|
artifact_type: content
|
|||
|
|
description: Guidelines for extracting economic entities from source text
|
|||
|
|
version: 1.0.0
|
|||
|
|
---
|
|||
|
|
|
|||
|
|
# Entity Extraction Rules
|
|||
|
|
|
|||
|
|
## What Constitutes an Entity
|
|||
|
|
|
|||
|
|
An economic entity is a distinct concept, actor, mechanism, or institution
|
|||
|
|
that plays a functional role in Adam Smith's economic analysis. Extract
|
|||
|
|
entities at the level of specificity where they carry independent meaning.
|
|||
|
|
|
|||
|
|
## Extraction Criteria
|
|||
|
|
|
|||
|
|
1. **Concepts**: Abstract economic ideas (e.g., "division of labour",
|
|||
|
|
"effectual demand", "natural price"). Extract when Smith defines,
|
|||
|
|
explains, or argues about the concept.
|
|||
|
|
|
|||
|
|
2. **Actors**: Economic agents with defined roles (e.g., "the labourer",
|
|||
|
|
"the merchant", "the sovereign"). Extract when the actor performs
|
|||
|
|
a distinct economic function.
|
|||
|
|
|
|||
|
|
3. **Mechanisms**: Processes or dynamics that produce economic effects
|
|||
|
|
(e.g., "accumulation of stock", "market price adjustment",
|
|||
|
|
"foreign trade"). Extract when the mechanism is described as
|
|||
|
|
producing specific outcomes.
|
|||
|
|
|
|||
|
|
4. **Institutions**: Organised structures that shape economic behaviour
|
|||
|
|
(e.g., "the corporation", "the guild", "the joint-stock company").
|
|||
|
|
Extract when the institution's economic function is described.
|
|||
|
|
|
|||
|
|
## Granularity Rules
|
|||
|
|
|
|||
|
|
- Extract at the level of a single coherent concept.
|
|||
|
|
- Do NOT extract synonyms as separate entities — choose the primary term
|
|||
|
|
Smith uses and note variations.
|
|||
|
|
- DO extract distinct aspects of a broad concept as separate entities when
|
|||
|
|
Smith treats them independently (e.g., "wages of labour" and "profits
|
|||
|
|
of stock" are separate from "price of commodities" even though they
|
|||
|
|
compose it).
|
|||
|
|
- If an entity appears across multiple chapters, extract it on first
|
|||
|
|
significant appearance and note cross-references in later chapters.
|
|||
|
|
|
|||
|
|
## Naming Conventions
|
|||
|
|
|
|||
|
|
- Use Smith's own terminology where possible.
|
|||
|
|
- Normalise to lowercase except for proper nouns.
|
|||
|
|
- Use the most common form Smith uses (e.g., "division of labour" not
|
|||
|
|
"divided labour").
|
|||
|
|
|
|||
|
|
## Quality Checks
|
|||
|
|
|
|||
|
|
- Each entity must have a definition that would be comprehensible without
|
|||
|
|
reading the source chapter.
|
|||
|
|
- Each entity must cite the specific book and chapter of first appearance.
|
|||
|
|
- **Economic Domain** must be EXACTLY ONE of: Production, Distribution,
|
|||
|
|
Exchange, Consumption, Accumulation, Regulation, or General Theory.
|
|||
|
|
Do not combine multiple domains. Do not use any other value.
|
|||
|
|
- **Source Chapter format**: Use `Book [Roman numeral], Chapter [number]`
|
|||
|
|
— for example `Book I, Chapter 3`. Do not include the chapter title,
|
|||
|
|
quotation marks, markdown formatting, or asterisks. Use Roman numerals
|
|||
|
|
for the book (I, II, III, IV, V).
|
|||
|
|
|
|||
|
|
|
|||
|
|
## VSM Framework Context
|
|||
|
|
|
|||
|
|
Use the following VSM framework as context to guide your extraction.
|
|||
|
|
Prioritize entities that are likely to have clear mappings to VSM concepts,
|
|||
|
|
but do not exclude entities simply because they lack an obvious mapping.
|
|||
|
|
|
|||
|
|
---
|
|||
|
|
id: vsm-framework
|
|||
|
|
name: vsm_framework
|
|||
|
|
artifact_type: content
|
|||
|
|
description: Stafford Beer's Viable System Model reference for economic analysis
|
|||
|
|
version: 1.0.0
|
|||
|
|
---
|
|||
|
|
|
|||
|
|
# Stafford Beer's Viable System Model (VSM)
|
|||
|
|
|
|||
|
|
The Viable System Model (VSM) is a model of the organisational structure of any
|
|||
|
|
autonomous system capable of producing itself. It was created by management
|
|||
|
|
cybernetician Stafford Beer in his books *Brain of the Firm* (1972) and
|
|||
|
|
*The Heart of Enterprise* (1979).
|
|||
|
|
|
|||
|
|
## Core Principle: Viability
|
|||
|
|
|
|||
|
|
A viable system is any system organised in such a way as to meet the demands
|
|||
|
|
of surviving in a changing environment. One of the prime features of systems
|
|||
|
|
that survive is that they are adaptable. The VSM expresses a model for a
|
|||
|
|
viable system, which is an abstracted cybernetic description applicable to
|
|||
|
|
any organisation that is a going concern.
|
|||
|
|
|
|||
|
|
## The Five Systems
|
|||
|
|
|
|||
|
|
### System 1 (S1) — Operations
|
|||
|
|
|
|||
|
|
The primary activities that produce the organisation's purpose. These are the
|
|||
|
|
operational units that directly create value. Each operational element is itself
|
|||
|
|
a viable system (the principle of recursion).
|
|||
|
|
|
|||
|
|
**In economic terms:** Productive enterprises, factories, farms, workshops,
|
|||
|
|
individual labourers performing specialised tasks, merchant operations.
|
|||
|
|
|
|||
|
|
**Key properties:** Autonomy within constraints, self-organisation,
|
|||
|
|
direct engagement with the environment.
|
|||
|
|
|
|||
|
|
### System 2 (S2) — Coordination
|
|||
|
|
|
|||
|
|
The information channels and bodies that allow the primary activities in
|
|||
|
|
System 1 to communicate with each other and that allow System 3 to monitor
|
|||
|
|
and coordinate activities. System 2 dampens oscillations and resolves
|
|||
|
|
conflicts between operational units.
|
|||
|
|
|
|||
|
|
**In economic terms:** Market price mechanisms, trade customs, standard
|
|||
|
|
weights and measures, commercial law, banking clearinghouses, trade guilds.
|
|||
|
|
|
|||
|
|
**Key properties:** Anti-oscillatory, dampening, scheduling, conflict
|
|||
|
|
resolution, standardisation.
|
|||
|
|
|
|||
|
|
### System 3 (S3) — Control / Operational Management
|
|||
|
|
|
|||
|
|
The structures and controls that establish the rules, resources, rights,
|
|||
|
|
and responsibilities of System 1 and provide an interface between Systems 1
|
|||
|
|
and Systems 4/5. System 3 represents the day-to-day control of the
|
|||
|
|
organisation. It optimises the internal environment.
|
|||
|
|
|
|||
|
|
**In economic terms:** Government regulation of trade, taxation policy, labour
|
|||
|
|
laws, enforcement of contracts, the "invisible hand" as emergent internal
|
|||
|
|
regulation, guilds and corporations governing members.
|
|||
|
|
|
|||
|
|
**Key properties:** Internal regulation, resource allocation, accountability,
|
|||
|
|
synergy extraction, performance management.
|
|||
|
|
|
|||
|
|
### System 3* (S3*) — Audit / Monitoring
|
|||
|
|
|
|||
|
|
The audit and monitoring channel that allows System 3 to verify information
|
|||
|
|
coming from System 1 through channels other than those provided by System 2.
|
|||
|
|
System 3* provides sporadic, direct access to operational reality.
|
|||
|
|
|
|||
|
|
**In economic terms:** Market inspections, quality checks, auditing of accounts,
|
|||
|
|
surprise investigations into trade practices, verification of weights and measures.
|
|||
|
|
|
|||
|
|
**Key properties:** Sporadic direct investigation, reality checking, bypassing
|
|||
|
|
normal reporting channels.
|
|||
|
|
|
|||
|
|
### System 4 (S4) — Intelligence / Adaptation
|
|||
|
|
|
|||
|
|
The bodies and processes that look outward to the environment to monitor
|
|||
|
|
how the organisation needs to adapt to remain viable. System 4 captures
|
|||
|
|
all relevant information about the outside-and-then environment. It is
|
|||
|
|
responsible for strategic responses.
|
|||
|
|
|
|||
|
|
**In economic terms:** Foreign intelligence about trade opportunities,
|
|||
|
|
market research, new technology adoption, colonial exploration and trade
|
|||
|
|
route development, understanding of foreign economic systems.
|
|||
|
|
|
|||
|
|
**Key properties:** Environmental scanning, future orientation, strategic
|
|||
|
|
planning, modelling, research and development.
|
|||
|
|
|
|||
|
|
### System 5 (S5) — Policy / Identity
|
|||
|
|
|
|||
|
|
The policy-making body that balances demands from Systems 3 and 4 and defines
|
|||
|
|
the identity, values, and purpose of the organisation. System 5 provides
|
|||
|
|
closure to the whole system and represents its supreme authority.
|
|||
|
|
|
|||
|
|
**In economic terms:** Sovereign authority, constitutional principles governing
|
|||
|
|
economic policy, national economic identity, the philosophical foundations
|
|||
|
|
of economic systems (mercantilism vs. free trade), the overarching purpose
|
|||
|
|
of the commonwealth.
|
|||
|
|
|
|||
|
|
**Key properties:** Identity, ethos, supreme command, policy closure,
|
|||
|
|
balancing internal and external perspectives.
|
|||
|
|
|
|||
|
|
## Key Concepts
|
|||
|
|
|
|||
|
|
### Recursion
|
|||
|
|
|
|||
|
|
Every viable system contains and is contained in a viable system. The same
|
|||
|
|
five-system structure recurs at every level of organisation. A workshop is
|
|||
|
|
a viable system within a factory, which is a viable system within an
|
|||
|
|
industry, which is a viable system within a national economy.
|
|||
|
|
|
|||
|
|
### Variety
|
|||
|
|
|
|||
|
|
A measure of the number of possible states of a system. The Law of Requisite
|
|||
|
|
Variety (Ashby's Law) states that only variety can absorb variety. A
|
|||
|
|
controller must have at least as much variety as the system it controls.
|
|||
|
|
|
|||
|
|
### Requisite Variety
|
|||
|
|
|
|||
|
|
The principle that for effective regulation, the variety of the regulator
|
|||
|
|
must match the variety of the system being regulated. This is achieved
|
|||
|
|
through variety attenuation (reducing the variety coming up from operations)
|
|||
|
|
and variety amplification (increasing the variety of management's responses).
|
|||
|
|
|
|||
|
|
### Attenuation and Amplification
|
|||
|
|
|
|||
|
|
Variety engineering mechanisms. Attenuation reduces variety (e.g., reporting
|
|||
|
|
summaries, statistical aggregation, standardisation). Amplification increases
|
|||
|
|
variety (e.g., delegation, empowerment, decentralisation).
|
|||
|
|
|
|||
|
|
### Algedonic Signals
|
|||
|
|
|
|||
|
|
Emergency signals that bypass the normal management hierarchy to alert
|
|||
|
|
higher systems of critical situations requiring immediate attention. Named
|
|||
|
|
from the Greek words for pain (algos) and pleasure (hedone).
|
|||
|
|
|
|||
|
|
**In economic terms:** Market panics, famine signals, sudden price collapses,
|
|||
|
|
trade embargoes, economic crises that demand immediate sovereign intervention.
|
|||
|
|
|
|||
|
|
### Autonomy
|
|||
|
|
|
|||
|
|
The degree of freedom granted to operational units (System 1) to self-organise
|
|||
|
|
within constraints set by System 3. Beer argued that maximum autonomy
|
|||
|
|
consistent with systemic cohesion yields maximum viability.
|
|||
|
|
|
|||
|
|
### Viability
|
|||
|
|
|
|||
|
|
The capacity of a system to maintain a separate existence and survive in a
|
|||
|
|
changing environment. A viable system continuously adapts while maintaining
|
|||
|
|
its identity.
|
|||
|
|
|
|||
|
|
|
|||
|
|
## Existing Entities
|
|||
|
|
|
|||
|
|
The following entities have already been extracted from previous chapters
|
|||
|
|
of this work. Do NOT re-extract any of these. If one of these entities
|
|||
|
|
appears in the current chapter, you may omit it entirely — the infospace
|
|||
|
|
already contains it. Only extract entities that are genuinely new.
|
|||
|
|
|
|||
|
|
- accumulation-of-stock
|
|||
|
|
- active-and-productive-stock
|
|||
|
|
- adulteration-of-metals
|
|||
|
|
- adulterine-guilds
|
|||
|
|
- advanced-state-of-society
|
|||
|
|
- advancing-state-of-manufacture
|
|||
|
|
- agricultural-capital
|
|||
|
|
- agricultural-capital-structure
|
|||
|
|
- agricultural-comparative-advantage
|
|||
|
|
- agricultural-cultivation
|
|||
|
|
- agricultural-cultivation-at-farmer-expense
|
|||
|
|
- agricultural-cultivation-at-proprietor-expense
|
|||
|
|
- agricultural-demand
|
|||
|
|
- agricultural-development-constraints
|
|||
|
|
- agricultural-development-sequence
|
|||
|
|
- agricultural-economic-potential
|
|||
|
|
- agricultural-efficiency
|
|||
|
|
- agricultural-improvement
|
|||
|
|
- agricultural-improvement-discouragement
|
|||
|
|
- agricultural-improvement-foundation
|
|||
|
|
- agricultural-labour
|
|||
|
|
- agricultural-market-access-cost-structure
|
|||
|
|
- agricultural-market-access-development-prerequisites
|
|||
|
|
- agricultural-market-access-development-sequence
|
|||
|
|
- agricultural-market-access-gradient
|
|||
|
|
- agricultural-market-access-inequality
|
|||
|
|
- agricultural-market-access-opportunity-cost
|
|||
|
|
- agricultural-market-communication-channels
|
|||
|
|
- agricultural-market-integration
|
|||
|
|
- agricultural-market-size-threshold
|
|||
|
|
- agricultural-opportunity-cost
|
|||
|
|
- agricultural-price-ceilings
|
|||
|
|
- agricultural-price-differential
|
|||
|
|
- agricultural-price-discovery
|
|||
|
|
- agricultural-price-discrimination
|
|||
|
|
- agricultural-price-elasticity
|
|||
|
|
- agricultural-price-equalization
|
|||
|
|
- agricultural-price-floors
|
|||
|
|
- agricultural-price-mechanism
|
|||
|
|
- agricultural-price-regulation
|
|||
|
|
- agricultural-price-stability
|
|||
|
|
- agricultural-price-transmission
|
|||
|
|
- agricultural-price-volatility
|
|||
|
|
- agricultural-productivity
|
|||
|
|
- agricultural-productivity-limits
|
|||
|
|
- agricultural-security-gradient
|
|||
|
|
- agricultural-spatial-inequality
|
|||
|
|
- agricultural-specialization
|
|||
|
|
- agricultural-stock
|
|||
|
|
- agricultural-supply
|
|||
|
|
- agricultural-surplus
|
|||
|
|
- agricultural-surplus-determination
|
|||
|
|
- agricultural-technology
|
|||
|
|
- agricultural-technology-adoption
|
|||
|
|
- agricultural-trade
|
|||
|
|
- ancient-system-of-political-economy
|
|||
|
|
- annual-consumption-of-metals
|
|||
|
|
- annual-industry-employed-in-production
|
|||
|
|
- annual-produce-of-land-and-labour
|
|||
|
|
- apprenticeships
|
|||
|
|
- artificer-neighbourhood-settlement
|
|||
|
|
- artificer-planter-independence
|
|||
|
|
- artificer-planter-transition
|
|||
|
|
- artificer-servant-status
|
|||
|
|
- artificers-and-retailers
|
|||
|
|
- artificial-grasses
|
|||
|
|
- artificial-market-creation
|
|||
|
|
- artisan-specialisation
|
|||
|
|
- assaying
|
|||
|
|
- assize-of-bread
|
|||
|
|
- assize-of-bread-and-ale
|
|||
|
|
- aulnagers
|
|||
|
|
- average-price-of-corn
|
|||
|
|
- balance-of-trade
|
|||
|
|
- bank-capital-adequacy
|
|||
|
|
- bank-capital-structure
|
|||
|
|
- bank-circulation-limits
|
|||
|
|
- bank-competition-effects
|
|||
|
|
- bank-credit-allocation
|
|||
|
|
- bank-credit-cycles
|
|||
|
|
- bank-credit-extension
|
|||
|
|
- bank-credit-quality
|
|||
|
|
- bank-economic-contribution
|
|||
|
|
- bank-economic-contribution-metrics
|
|||
|
|
- bank-economic-cycles
|
|||
|
|
- bank-economic-development
|
|||
|
|
- bank-economic-development-metrics
|
|||
|
|
- bank-economic-efficiency
|
|||
|
|
- bank-economic-efficiency-factors
|
|||
|
|
- bank-economic-efficiency-metrics
|
|||
|
|
- bank-economic-growth
|
|||
|
|
- bank-economic-resilience
|
|||
|
|
- bank-economic-resilience-factors
|
|||
|
|
- bank-economic-resilience-metrics
|
|||
|
|
- bank-economic-stability
|
|||
|
|
- bank-failure-mechanisms
|
|||
|
|
- bank-financial-development
|
|||
|
|
- bank-financial-innovation
|
|||
|
|
- bank-financial-innovation-adoption
|
|||
|
|
- bank-financial-innovation-diffusion
|
|||
|
|
- bank-financial-innovation-factors
|
|||
|
|
- bank-financial-innovation-impact
|
|||
|
|
- bank-financial-innovation-metrics
|
|||
|
|
- bank-financial-intermediation
|
|||
|
|
- bank-financial-intermediation-efficiency
|
|||
|
|
- bank-financial-stability
|
|||
|
|
- bank-financial-stability-factors
|
|||
|
|
- bank-financial-stability-metrics
|
|||
|
|
- bank-financial-system-integration
|
|||
|
|
- bank-financial-system-stability
|
|||
|
|
- bank-information-asymmetry
|
|||
|
|
- bank-interest-rate-determination
|
|||
|
|
- bank-liquidity-management
|
|||
|
|
- bank-market-discipline
|
|||
|
|
- bank-market-structure
|
|||
|
|
- bank-monetary-policy
|
|||
|
|
- bank-monetary-stability
|
|||
|
|
- bank-notes
|
|||
|
|
- bank-operational-efficiency
|
|||
|
|
- bank-operational-risk
|
|||
|
|
- bank-public-utility
|
|||
|
|
- bank-regulatory-compliance
|
|||
|
|
- bank-regulatory-effectiveness
|
|||
|
|
- bank-regulatory-evolution
|
|||
|
|
- bank-regulatory-framework
|
|||
|
|
- bank-regulatory-framework-evolution
|
|||
|
|
- bank-reserves
|
|||
|
|
- bank-risk-management
|
|||
|
|
- bank-systemic-risk
|
|||
|
|
- bank-systemic-risk-management
|
|||
|
|
- bank-systemic-stability
|
|||
|
|
- bank-transaction-costs
|
|||
|
|
- barbarous-nations-barrier
|
|||
|
|
- barter-and-exchange
|
|||
|
|
- benevolence
|
|||
|
|
- bills-of-exchange
|
|||
|
|
- bleacher
|
|||
|
|
- bullion
|
|||
|
|
- butcher-trade
|
|||
|
|
- bye-laws
|
|||
|
|
- canal-communication
|
|||
|
|
- capital
|
|||
|
|
- capital-accumulation
|
|||
|
|
- capital-employed
|
|||
|
|
- capital-employment-advantages
|
|||
|
|
- capital-employment-effects
|
|||
|
|
- capital-employment-security-gradient
|
|||
|
|
- capital-replacement
|
|||
|
|
- capital-security-preference
|
|||
|
|
- capital-security-visibility
|
|||
|
|
- carriage-value-savings
|
|||
|
|
- carrying-trade
|
|||
|
|
- cash-accounts
|
|||
|
|
- certificates
|
|||
|
|
- cheap-years
|
|||
|
|
- circulating-capital
|
|||
|
|
- circulating-capital-components
|
|||
|
|
- circulating-money
|
|||
|
|
- circulation-of-money
|
|||
|
|
- coal-heaver
|
|||
|
|
- coal-price
|
|||
|
|
- coarser-and-finer-materials
|
|||
|
|
- coined-money
|
|||
|
|
- collier
|
|||
|
|
- colony-prosperity
|
|||
|
|
- combination-of-masters
|
|||
|
|
- combination-of-workmen
|
|||
|
|
- command-over-labour
|
|||
|
|
- commerce-between-town-and-country
|
|||
|
|
- commerce-of-towns
|
|||
|
|
- commercial-development-sequence-inversion
|
|||
|
|
- commercial-family-duration-pattern
|
|||
|
|
- commercial-hospitality-contrast
|
|||
|
|
- commercial-independence-effect
|
|||
|
|
- commercial-interactions
|
|||
|
|
- commercial-or-mercantile-system
|
|||
|
|
- commercial-order-and-government-introduction
|
|||
|
|
- commercial-society
|
|||
|
|
- commercial-society-emergence
|
|||
|
|
- commercial-transactions
|
|||
|
|
- common-annual-profits-of-manufacturing-stock
|
|||
|
|
- common-labour-wages
|
|||
|
|
- common-returns-of-stock
|
|||
|
|
- commonalty
|
|||
|
|
- competition-among-buyers
|
|||
|
|
- competition-among-dealers
|
|||
|
|
- competition-among-sellers
|
|||
|
|
- complete-manufacture
|
|||
|
|
- component-parts-of-price
|
|||
|
|
- consumption-of-foreign-goods
|
|||
|
|
- contract
|
|||
|
|
- conversion-price
|
|||
|
|
- copper-money
|
|||
|
|
- corn-exportation-prohibition
|
|||
|
|
- corn-land
|
|||
|
|
- corn-rent
|
|||
|
|
- corporation-laws
|
|||
|
|
- corporation-privileges-and-market-prices
|
|||
|
|
- country-gentlemen
|
|||
|
|
- country-life-charms
|
|||
|
|
- cultivation-improvement-priority
|
|||
|
|
- dead-stock
|
|||
|
|
- dear-years
|
|||
|
|
- debasement-of-currency
|
|||
|
|
- declining-manufacture
|
|||
|
|
- degradation-of-coin
|
|||
|
|
- demand-for-labour
|
|||
|
|
- demesne
|
|||
|
|
- diamond-buckles-metaphor
|
|||
|
|
- discount-of-bills
|
|||
|
|
- distant-country-subsistence
|
|||
|
|
- distant-market-manufacturing
|
|||
|
|
- distant-sale-manufacturing
|
|||
|
|
- division-of-labour
|
|||
|
|
- division-of-labour-advantage
|
|||
|
|
- double-coincidence-of-wants
|
|||
|
|
- drawing-and-redrawing
|
|||
|
|
- dwelling-house-distinction
|
|||
|
|
- early-and-rude-state-of-society
|
|||
|
|
- early-navigation-advantages
|
|||
|
|
- economic-accessibility-determinants
|
|||
|
|
- economic-accessibility-gradient
|
|||
|
|
- economic-autonomy-gradient
|
|||
|
|
- economic-backwardness
|
|||
|
|
- economic-connectivity-importance
|
|||
|
|
- economic-development-constraints
|
|||
|
|
- economic-development-geography
|
|||
|
|
- economic-development-geography-theory
|
|||
|
|
- economic-development-sequence
|
|||
|
|
- economic-development-sequencing
|
|||
|
|
- economic-development-spatial-patterns
|
|||
|
|
- economic-geography
|
|||
|
|
- economic-geography-determinism
|
|||
|
|
- economic-geography-impact
|
|||
|
|
- economic-isolation-effects
|
|||
|
|
- economic-opportunity-cost
|
|||
|
|
- economic-opportunity-geography
|
|||
|
|
- economic-prosperity-symptoms
|
|||
|
|
- economic-spatial-inequality
|
|||
|
|
- economic-spatial-organisation
|
|||
|
|
- economic-stagnation-symptoms
|
|||
|
|
- economic-system-actor
|
|||
|
|
- economic-system-adaptability
|
|||
|
|
- economic-system-adaptation
|
|||
|
|
- economic-system-adoption-factor
|
|||
|
|
- economic-system-analysis
|
|||
|
|
- economic-system-application
|
|||
|
|
- economic-system-benchmark
|
|||
|
|
- economic-system-best-practice
|
|||
|
|
- economic-system-change-agent
|
|||
|
|
- economic-system-comparison
|
|||
|
|
- economic-system-comprehension
|
|||
|
|
- economic-system-consequence
|
|||
|
|
- economic-system-context
|
|||
|
|
- economic-system-coordination
|
|||
|
|
- economic-system-development
|
|||
|
|
- economic-system-diffusion-mechanism
|
|||
|
|
- economic-system-effectiveness
|
|||
|
|
- economic-system-efficiency
|
|||
|
|
- economic-system-evaluation
|
|||
|
|
- economic-system-evaluation-criteria
|
|||
|
|
- economic-system-evolution
|
|||
|
|
- economic-system-experience-accumulation
|
|||
|
|
- economic-system-explanation
|
|||
|
|
- economic-system-failure-indicator
|
|||
|
|
- economic-system-framework
|
|||
|
|
- economic-system-function
|
|||
|
|
- economic-system-governance
|
|||
|
|
- economic-system-implementation
|
|||
|
|
- economic-system-implementation-barrier
|
|||
|
|
- economic-system-improvement
|
|||
|
|
- economic-system-influence
|
|||
|
|
- economic-system-innovation
|
|||
|
|
- economic-system-innovation-driver
|
|||
|
|
- economic-system-institution
|
|||
|
|
- economic-system-integration
|
|||
|
|
- economic-system-interaction
|
|||
|
|
- economic-system-knowledge
|
|||
|
|
- economic-system-knowledge-transfer
|
|||
|
|
- economic-system-learning-process
|
|||
|
|
- economic-system-legitimacy
|
|||
|
|
- economic-system-management
|
|||
|
|
- economic-system-mechanism
|
|||
|
|
- economic-system-mechanisms
|
|||
|
|
- economic-system-objectives
|
|||
|
|
- economic-system-operation
|
|||
|
|
- economic-system-outcome-measure
|
|||
|
|
- economic-system-outcomes
|
|||
|
|
- economic-system-performance-indicator
|
|||
|
|
- economic-system-policy
|
|||
|
|
- economic-system-practice
|
|||
|
|
- economic-system-principles
|
|||
|
|
- economic-system-purpose
|
|||
|
|
- economic-system-relationship
|
|||
|
|
- economic-system-resistance-factor
|
|||
|
|
- economic-system-selection
|
|||
|
|
- economic-system-standard
|
|||
|
|
- economic-system-structure
|
|||
|
|
- economic-system-success-measure
|
|||
|
|
- economic-system-sustainability
|
|||
|
|
- economic-system-theory
|
|||
|
|
- economic-system-transformation
|
|||
|
|
- economic-system-transition-challenge
|
|||
|
|
- economic-systems-distinction
|
|||
|
|
- effect-of-prohibition-on-gold-and-silver-export
|
|||
|
|
- effectual-demand
|
|||
|
|
- ejectment-action
|
|||
|
|
- encroachment-upon-capital
|
|||
|
|
- engrossers-and-forestallers
|
|||
|
|
- entail
|
|||
|
|
- equal-profit-employment-choice
|
|||
|
|
- exchange
|
|||
|
|
- exchange-rate-mechanism
|
|||
|
|
- exchangeable-value
|
|||
|
|
- exchequer
|
|||
|
|
- exclusive-corporation
|
|||
|
|
- export-bounty
|
|||
|
|
- exportation-bounty
|
|||
|
|
- exportation-of-gold-and-silver-as-effect-of-declension
|
|||
|
|
- extraordinary-profits
|
|||
|
|
- fairs-and-markets
|
|||
|
|
- farm-rent
|
|||
|
|
- farmer
|
|||
|
|
- farmers-capital
|
|||
|
|
- farmers-profit
|
|||
|
|
- favour
|
|||
|
|
- feudal-anarchy
|
|||
|
|
- feudal-government-effects
|
|||
|
|
- fixed-capital
|
|||
|
|
- flax-grower
|
|||
|
|
- fluctuations-in-value-of-gold-and-silver
|
|||
|
|
- foreign-capital-exportation
|
|||
|
|
- foreign-commerce-manufactures-birth
|
|||
|
|
- foreign-trade
|
|||
|
|
- foreign-trade-enrichment-mechanism
|
|||
|
|
- foreign-trade-of-consumption
|
|||
|
|
- four-methods-of-employing-capital
|
|||
|
|
- free-burgh
|
|||
|
|
- freeholder-yeomanry
|
|||
|
|
- frozen-ocean-barrier
|
|||
|
|
- frugal-and-industrious-borrowers
|
|||
|
|
- frugality-versus-prodigality
|
|||
|
|
- fruit-garden
|
|||
|
|
- fruit-wall
|
|||
|
|
- funds-for-maintaining-labour
|
|||
|
|
- funds-for-maintaining-productive-labour
|
|||
|
|
- funds-for-maintaining-unproductive-hands
|
|||
|
|
- gold-and-silver-as-measure-of-value
|
|||
|
|
- gold-money
|
|||
|
|
- gold-price-variation
|
|||
|
|
- gross-revenue
|
|||
|
|
- hanseatic-league
|
|||
|
|
- higgling-and-bargaining-of-the-market
|
|||
|
|
- home-trade
|
|||
|
|
- hop-garden
|
|||
|
|
- human-folly-injustice-exposure
|
|||
|
|
- human-nature
|
|||
|
|
- idle-consumers
|
|||
|
|
- immediate-consumption
|
|||
|
|
- import-restraint
|
|||
|
|
- improved-farm-advantages
|
|||
|
|
- improved-land
|
|||
|
|
- improvement-of-the-country
|
|||
|
|
- inclosure
|
|||
|
|
- increase-of-money-as-effect-of-prosperity
|
|||
|
|
- inland-market-limitation
|
|||
|
|
- inland-navigation-extent
|
|||
|
|
- inland-parts-of-the-country
|
|||
|
|
- inland-trade
|
|||
|
|
- inn-or-tavern-keeper
|
|||
|
|
- instruments-of-husbandry
|
|||
|
|
- interest
|
|||
|
|
- interest-of-money
|
|||
|
|
- interest-or-use-of-money
|
|||
|
|
- journeymen
|
|||
|
|
- judgment-in-labour-application
|
|||
|
|
- kelp
|
|||
|
|
- kitchen-garden
|
|||
|
|
- labour-of-inspection-and-direction
|
|||
|
|
- labouring-cattle
|
|||
|
|
- labouring-poor
|
|||
|
|
- land-carriage
|
|||
|
|
- land-mines-and-fisheries
|
|||
|
|
- landlord
|
|||
|
|
- landlords-share
|
|||
|
|
- law-of-primogeniture
|
|||
|
|
- legal-rate-of-interest
|
|||
|
|
- legal-tender
|
|||
|
|
- licence-to-gather-natural-produce
|
|||
|
|
- lowest-rate-of-wages
|
|||
|
|
- machinery-invention
|
|||
|
|
- manufactured-produce
|
|||
|
|
- manufacturer
|
|||
|
|
- manufacturing-capital
|
|||
|
|
- manufacturing-process-subdivision
|
|||
|
|
- manufacturing-subdivision
|
|||
|
|
- maritime-commerce-development
|
|||
|
|
- maritime-employment
|
|||
|
|
- market-access-cost-structure
|
|||
|
|
- market-access-development-sequence
|
|||
|
|
- market-access-economic-potential
|
|||
|
|
- market-access-gradient
|
|||
|
|
- market-access-inequality
|
|||
|
|
- market-access-opportunity-cost
|
|||
|
|
- market-based-economic-geography
|
|||
|
|
- market-based-economic-identity
|
|||
|
|
- market-based-economic-structure
|
|||
|
|
- market-based-productivity-limits
|
|||
|
|
- market-based-specialisation
|
|||
|
|
- market-communication-channels
|
|||
|
|
- market-demand-regulation
|
|||
|
|
- market-development-prerequisites
|
|||
|
|
- market-driven-division
|
|||
|
|
- market-extent
|
|||
|
|
- market-extent-advantageousness
|
|||
|
|
- market-extent-economic-impact
|
|||
|
|
- market-extent-measurement
|
|||
|
|
- market-for-surplus-produce
|
|||
|
|
- market-integration-barriers
|
|||
|
|
- market-integration-potential
|
|||
|
|
- market-integration-timeline
|
|||
|
|
- market-obstruction
|
|||
|
|
- market-price-adjustment
|
|||
|
|
- market-price-mechanism-for-rude-produce
|
|||
|
|
- market-price-of-bullion
|
|||
|
|
- market-price-of-commodities
|
|||
|
|
- market-price-of-things
|
|||
|
|
- market-price-regulation-mechanism
|
|||
|
|
- market-proximity-advantage
|
|||
|
|
- market-rate-of-interest
|
|||
|
|
- market-regulation-of-prices
|
|||
|
|
- market-separation
|
|||
|
|
- market-size-economies
|
|||
|
|
- market-size-specialisation-threshold
|
|||
|
|
- market-size-specialization
|
|||
|
|
- market-size-threshold
|
|||
|
|
- market-town-economy
|
|||
|
|
- market-town-formation
|
|||
|
|
- masquerade-dress-trade
|
|||
|
|
- master-artificer
|
|||
|
|
- master-manufacturer
|
|||
|
|
- materials-and-subsistence
|
|||
|
|
- measure-of-exchangeable-value
|
|||
|
|
- mediterranean-civilisation-pattern
|
|||
|
|
- menial-servants
|
|||
|
|
- merchant
|
|||
|
|
- merchant-capital
|
|||
|
|
- merchant-country-gentleman-transition
|
|||
|
|
- metal-currency
|
|||
|
|
- metayer
|
|||
|
|
- military-assistance
|
|||
|
|
- military-discipline
|
|||
|
|
- military-employment
|
|||
|
|
- mine-fertility
|
|||
|
|
- mine-situation
|
|||
|
|
- mint
|
|||
|
|
- mint-price
|
|||
|
|
- modern-states-inversion
|
|||
|
|
- modern-system-of-political-economy
|
|||
|
|
- modes-of-expense-affecting-public-opulence
|
|||
|
|
- money
|
|||
|
|
- money-as-instrument-of-commerce
|
|||
|
|
- money-rent
|
|||
|
|
- moneys-worth
|
|||
|
|
- monied-interest
|
|||
|
|
- monopoly-effects-on-market-price
|
|||
|
|
- monopoly-price-of-land
|
|||
|
|
- mutual-gain-reciprocity
|
|||
|
|
- mutual-good-offices
|
|||
|
|
- mutual-servitude
|
|||
|
|
- national-capital-composition
|
|||
|
|
- national-economic-identity
|
|||
|
|
- natural-complement-of-riches
|
|||
|
|
- natural-course-of-things
|
|||
|
|
- natural-development-sequence
|
|||
|
|
- natural-inclinations-thwarting
|
|||
|
|
- natural-liberty-in-banking
|
|||
|
|
- natural-liberty-in-trade
|
|||
|
|
- natural-market-advantages
|
|||
|
|
- natural-order-inversion
|
|||
|
|
- natural-order-of-economic-development
|
|||
|
|
- natural-preference-cultivation
|
|||
|
|
- natural-price-as-central-price
|
|||
|
|
- natural-price-of-commodities
|
|||
|
|
- natural-produce-of-land
|
|||
|
|
- natural-progress-of-improvement
|
|||
|
|
- natural-rates-of-wages-profit-and-rent
|
|||
|
|
- natural-rent-of-land
|
|||
|
|
- natural-state-of-employments
|
|||
|
|
- navigable-rivers
|
|||
|
|
- neat-revenue
|
|||
|
|
- necessity
|
|||
|
|
- nominal-measure-of-value
|
|||
|
|
- nominal-price-of-commodities
|
|||
|
|
- non-standard-metal
|
|||
|
|
- occasional-and-temporary-market-fluctuations
|
|||
|
|
- ordinary-market-price-of-land
|
|||
|
|
- ordinary-rates-of-wages-profit-and-rent
|
|||
|
|
- ordinary-state-of-employments
|
|||
|
|
- original-destination-of-man
|
|||
|
|
- original-government-manners
|
|||
|
|
- overstocked-market-conditions
|
|||
|
|
- paper-money
|
|||
|
|
- pasture-land
|
|||
|
|
- payment-in-kind
|
|||
|
|
- perfect-liberty-in-trade
|
|||
|
|
- permanent-market-price-enhancements
|
|||
|
|
- perpetual-fund-for-maintenance-of-labour
|
|||
|
|
- piece-work-wages
|
|||
|
|
- pin-maker-trade
|
|||
|
|
- planter-independence
|
|||
|
|
- plate-household-silver
|
|||
|
|
- poacher
|
|||
|
|
- political-economy
|
|||
|
|
- political-economy-objectives
|
|||
|
|
- poll-tax
|
|||
|
|
- poll-tax-compensation
|
|||
|
|
- potato-cultivation
|
|||
|
|
- precious-metals-consumption
|
|||
|
|
- present-state-of-the-nation-analysis
|
|||
|
|
- price-in-labour
|
|||
|
|
- price-in-money
|
|||
|
|
- price-of-commodities
|
|||
|
|
- prime-cost-of-commodities
|
|||
|
|
- principal-clerk
|
|||
|
|
- principal-employments
|
|||
|
|
- private-misconduct-versus-public-prodigality
|
|||
|
|
- prodigals
|
|||
|
|
- prodigals-and-projectors
|
|||
|
|
- productive-abilities
|
|||
|
|
- productive-and-unproductive-labour
|
|||
|
|
- productive-labourers
|
|||
|
|
- productive-powers-of-labour
|
|||
|
|
- profits-of-stock
|
|||
|
|
- progress-of-opulence
|
|||
|
|
- progressive-state-of-society
|
|||
|
|
- progressive-wealth-consequentiality
|
|||
|
|
- promissory-notes
|
|||
|
|
- proportion-between-metals
|
|||
|
|
- proportion-between-productive-and-unproductive-hands
|
|||
|
|
- public-education-of-professionals
|
|||
|
|
- public-executioner
|
|||
|
|
- public-fiars
|
|||
|
|
- public-law-on-coinage
|
|||
|
|
- public-lottery
|
|||
|
|
- public-mourning-effects
|
|||
|
|
- public-registers-of-manufactures
|
|||
|
|
- public-services-funding
|
|||
|
|
- purveyance
|
|||
|
|
- quantity-of-labour
|
|||
|
|
- rate-of-interest
|
|||
|
|
- rate-of-profit
|
|||
|
|
- real-measure-of-value
|
|||
|
|
- real-price-of-commodities
|
|||
|
|
- real-value-of-corn-rent
|
|||
|
|
- regulated-proportion
|
|||
|
|
- religious-occupational-restrictions
|
|||
|
|
- rent-of-land
|
|||
|
|
- requisite-variety-in-banking
|
|||
|
|
- retail-trade
|
|||
|
|
- retailers
|
|||
|
|
- retainers-and-dependents-system
|
|||
|
|
- revenue
|
|||
|
|
- revenue-constituting-profit-and-rent
|
|||
|
|
- revenue-destined-for-capital-replacement
|
|||
|
|
- revenue-for-public-services
|
|||
|
|
- revenue-or-subsistence-for-the-people
|
|||
|
|
- rice-countries
|
|||
|
|
- river-navigation-infrastructure
|
|||
|
|
- rude-produce
|
|||
|
|
- rural-urban-reciprocity
|
|||
|
|
- scarcity-of-hands
|
|||
|
|
- sea-coast-development
|
|||
|
|
- security-preference-capital
|
|||
|
|
- seed-as-fixed-capital
|
|||
|
|
- seed-time-and-harvest-metaphor
|
|||
|
|
- seignorage
|
|||
|
|
- self-love
|
|||
|
|
- servile-condition
|
|||
|
|
- settlement-laws
|
|||
|
|
- silver-money
|
|||
|
|
- silver-price-variation
|
|||
|
|
- skill-and-dexterity
|
|||
|
|
- smuggling-of-precious-metals
|
|||
|
|
- smuggling-trade
|
|||
|
|
- sober-people
|
|||
|
|
- societys-general-stock
|
|||
|
|
- sovereign-parsimony
|
|||
|
|
- spare-revenue
|
|||
|
|
- specie
|
|||
|
|
- species-of-industry-with-consistent-output
|
|||
|
|
- species-of-industry-with-variable-output
|
|||
|
|
- speculative-trade
|
|||
|
|
- stamp-masters
|
|||
|
|
- standard-metal
|
|||
|
|
- standard-weight-of-coin
|
|||
|
|
- state-or-commonwealth-revenue
|
|||
|
|
- stationary-country
|
|||
|
|
- statute-of-labourers
|
|||
|
|
- statutes-of-apprenticeship-effects
|
|||
|
|
- sterling-mark
|
|||
|
|
- stock
|
|||
|
|
- stock-lent-at-interest
|
|||
|
|
- stock-of-the-country
|
|||
|
|
- stock-of-the-farmer
|
|||
|
|
- subsistence
|
|||
|
|
- subsistence-agriculture
|
|||
|
|
- subsistence-industry-priority
|
|||
|
|
- subsistence-necessity-priority
|
|||
|
|
- subsistence-of-the-dealer
|
|||
|
|
- subsistence-prioritization
|
|||
|
|
- sugar-colonies
|
|||
|
|
- superfluity
|
|||
|
|
- superior-hardship-and-superior-skill
|
|||
|
|
- surplus-produce
|
|||
|
|
- system-of-agriculture
|
|||
|
|
- system-of-commerce
|
|||
|
|
- taille
|
|||
|
|
- tale
|
|||
|
|
- temporary-price-of-corn
|
|||
|
|
- territorial-cultivation-completeness
|
|||
|
|
- territorial-cultivation-limit
|
|||
|
|
- territorial-improvement-support
|
|||
|
|
- territorial-support-limitation
|
|||
|
|
- three-original-sources-of-revenue
|
|||
|
|
- three-way-employment-of-stock
|
|||
|
|
- thriving-country
|
|||
|
|
- tobacco-colonies
|
|||
|
|
- toil-and-trouble-of-acquiring
|
|||
|
|
- town-country-dependency
|
|||
|
|
- town-market-function
|
|||
|
|
- town-reproduction-impossibility
|
|||
|
|
- trade-balance-mechanism
|
|||
|
|
- trade-capital
|
|||
|
|
- trade-encouragement
|
|||
|
|
- trade-route-dependency
|
|||
|
|
- transportation-cost-differential
|
|||
|
|
- transportation-infrastructure-importance
|
|||
|
|
- transportation-mode-economic-effects
|
|||
|
|
- treasure-accumulation
|
|||
|
|
- treasure-trove
|
|||
|
|
- treaty
|
|||
|
|
- truck
|
|||
|
|
- two-branches-of-circulation
|
|||
|
|
- uncultivated-land-availability
|
|||
|
|
- unimproved-land
|
|||
|
|
- university-of-trades
|
|||
|
|
- unproductive-labourers
|
|||
|
|
- unstamped-bars
|
|||
|
|
- urban-autonomy
|
|||
|
|
- urban-rural-reciprocity
|
|||
|
|
- usury
|
|||
|
|
- value-in-exchange
|
|||
|
|
- value-in-use
|
|||
|
|
- value-of-gold
|
|||
|
|
- value-of-silver
|
|||
|
|
- variety-of-talents
|
|||
|
|
- venison
|
|||
|
|
- victuals
|
|||
|
|
- villeinage
|
|||
|
|
- vineyard
|
|||
|
|
- wages-of-a-journeyman
|
|||
|
|
- wages-of-labour
|
|||
|
|
- waggon-way-through-the-air-metaphor
|
|||
|
|
- water-carriage
|
|||
|
|
- water-pond-metaphor
|
|||
|
|
- weighing
|
|||
|
|
- whole-produce-of-labour
|
|||
|
|
- wholesale-merchants
|
|||
|
|
- wholesale-trade
|
|||
|
|
- wood-price
|
|||
|
|
- wool-grower
|
|||
|
|
|
|||
|
|
## Instructions
|
|||
|
|
|
|||
|
|
1. Read the source chapter carefully.
|
|||
|
|
2. Review the list of existing entities above and do not duplicate them.
|
|||
|
|
3. Identify all distinct economic concepts, actors, mechanisms, and institutions
|
|||
|
|
that are NOT already in the existing entities list.
|
|||
|
|
4. For each new entity, produce a separate markdown document following the
|
|||
|
|
Economic Entity Schema v1.0.
|
|||
|
|
5. Each entity document must include:
|
|||
|
|
- An H1 heading with the entity name
|
|||
|
|
- A Definition section (20-150 words)
|
|||
|
|
- A Source Chapter section citing the specific chapter
|
|||
|
|
- A Context section describing where in the argument the entity appears
|
|||
|
|
- An Economic Domain section classifying the entity
|
|||
|
|
6. Optionally include Smith's Original Wording (direct quote) and
|
|||
|
|
Modern Interpretation sections.
|
|||
|
|
7. Use neutral, analytical language throughout.
|
|||
|
|
8. Ensure each entity is distinct and self-contained.
|
|||
|
|
|
|||
|
|
## Output Format
|
|||
|
|
|
|||
|
|
Output each entity as a separate markdown document, delimited by
|
|||
|
|
`--- ENTITY: <entity-name> ---` markers.
|
|||
|
|
|
|||
|
|
Use **H2 headings** (`##`) for each section inside the entity document.
|
|||
|
|
Do NOT use inline `Section:` format or H3 headings.
|
|||
|
|
|
|||
|
|
Example of a correctly formatted entity:
|
|||
|
|
|
|||
|
|
```
|
|||
|
|
--- ENTITY: division of labour ---
|
|||
|
|
|
|||
|
|
# Division of Labour
|
|||
|
|
|
|||
|
|
## Definition
|
|||
|
|
|
|||
|
|
The separation of a work process into distinct tasks performed by specialised
|
|||
|
|
workers, increasing productivity through greater dexterity, saved time, and
|
|||
|
|
the invention of labour-saving machinery.
|
|||
|
|
|
|||
|
|
## Source Chapter
|
|||
|
|
|
|||
|
|
Book I, Chapter 1
|
|||
|
|
|
|||
|
|
## Context
|
|||
|
|
|
|||
|
|
The opening chapter's central argument, illustrated by Smith's pin factory
|
|||
|
|
example showing how dividing 18 operations dramatically increases output.
|
|||
|
|
|
|||
|
|
## Economic Domain
|
|||
|
|
|
|||
|
|
Production
|
|||
|
|
|
|||
|
|
---
|
|||
|
|
```
|