WEALTH OF NATIONS. 223 



and he who before would have vested one hundred 

 pounds either in trade or loan, would now vest two 

 hundred pounds, and would receive ten pounds in- 

 stead of the five he before received, being the very 

 same per centage in each case." In this chapter Dr. 

 Smith, with a very singular deviation from his general 

 principles, regards laws regulating the rate of interest 

 with favour, provided the legal rate be fixed a little 

 above the market rate. This opinion has been most 

 unanswerably exposed and refuted by Mr. Bentham, 

 in his admirable ' Defence of Usury,' published about 

 the time of Dr. Smith's decease. 



v. The capital of a country can only be employed 

 in one or other of these four ways in agriculture, 

 mines, works, fisheries ; or in manufactures ; or in the 

 wholesale trade, foreign and domestic ; or in the retail 

 trade. Dr. Smith considers it clear, that agriculture 

 puts in motion most productive labourers, manufac- 

 turers next to agriculture, then retail trade, and whole- 

 sale trade least of all. He also holds that agriculture 

 augments the capital of the community most rapidly, 

 manufactures next, then retail trade, and lastly whole- 

 sale. The wholesale trade he divides into three 

 branches, properly speaking into four the home trade, 

 the foreign direct trade of consumption, the foreign 

 indirect or round about trade of consumption, and the 

 carrying trade. The first he considers the most bene- 

 ficial employment of capital, because it replaces two 

 national capitals ; the second and third are, according 

 to him, less beneficial, because they replace one na- 

 tional and one foreign capital; while the carrying 

 trade replaces two capitals, both foreign. I believe 

 the views contained in this chapter are pretty generally 

 admitted to be erroneous, that is to say, as regards the 

 relative importance assigned to different branches of 

 trade or employments of capital. This seerns as re- 

 gards the comparison of agriculture, manufactures, and 

 trade, to follow, from what has been stated under the 



