Ricardo on Rent
Source D. Ohmans
Date 01/03/22/01:27

Chapter 2 - Principles of Political Economy and Taxation, 1817

On Rent

It remains however to be considered, whether the
appropriation of land, and the consequent creation of rent, will
occasion any variation in the relative value of commodities,
independently of the quantity of labour necessary to production.
In order to understand this part of the subject, we must enquire
into the nature of rent, and the laws by which its rise or fall
is regulated....
On the first settling of a country, in which there is an
abundance of rich and fertile land, a very small proportion of
which is required to be cultivated for the support of the actual
population, or indeed can be cultivated with the capital which
the population can command, there will be no rent; for no one
would pay for the use of land, when there was an abundant
quantity not yet appropriated, and, therefore, at the disposal of
whosoever might choose to cultivate it.
On the common principles of supply and demand, no rent could
be paid for such land, for the reason stated why nothing is given
for the use of air and water, or for any other of the gifts of
nature which exist in boundless quantity. With a given quantity
of materials, and with the assistance of the pressure of the
atmosphere, and the elasticity of steam, engines may perform
work, and abridge human labour to a very great extent; but no
charge is made for the use of these natural aids, because they
are inexhaustible, and at every man's disposal. In the same
manner the brewer, the distiller, the dyer, make incessant use of
the air and water for the production of their commodities; but as
the supply is boundless, they bear no price. If all land had
the same properties, if it were unlimited in quantity, and
uniform in quality, no charge could be made for its use, unless
where it possessed peculiar advantages of situation. It is only,
then, because land is not unlimited in quantity and uniform in
quality, and because in the progress of population, land of an
inferior quality, or less advantageously situated, is called into
cultivation, that rent is ever paid for the use of it. When in
the progress of society, land of the second degree of fertility
is taken into cultivation, rent immediately commences on that of
the first quality, and the amount of that rent will depend on the
difference in the quality of these two portions of land.
When land of the third quality is taken into cultivation,
rent immediately commences on the second, and it is regulated as
before, by the difference in their productive powers. At the same
time, the rent of the first quality will rise, for that must
always be above the rent of the second, by the difference between
the produce which they yield with a given quantity of capital and
labour. With every step in the progress of population, which
shall oblige a country to have recourse to land of a worse
quality, to enable it to raise its supply of food, rent, on all
the more fertile land, will rise.

[View the list]

InternetBoard v1.0
Copyright (c) 1998, Joongpil Cho