120 



POLITICAL ECONOMY 



out of cultivation, and only part of the tax will be borne by the 

 landlord ; part will fall in the first instance on the tenant, but 

 he, like any other manufacturer, will recover almost the whole 

 of his portion from the consumer. Tenants will be injured by 

 the limitation of the number of transactions, and labourers by the 

 diminution in the amount of work required. This is the effect 

 of an octroi duty. 



Sometimes a tax is assessed not on the rent, but on an assumed 

 value per acre. Such a tax can never be raised on land which 

 pays no rent, for the owner would rather abandon possession of 

 the land than pay the tax. It might, however, lead to the aban- 

 donment of the cultivation of poorer soils ; it would then injure 



N" 



Fig. 6. 



tenants and consumers, although they would not pay one penny 

 of the tax ; for taxes cannot'be paid out of lands which lie waste ; 

 assuming that the tax is always less than the rent, as it cer- 

 tainly always should be, it will be paid wholly by the landlords. 

 The tax in this case does not diminish the supply of land. 



A cognate question of great interest is, Who reaps the benefit 

 of any improvements in agriculture, making land return more 

 than it previously did ? This improvement may require, and 

 probably will require, increased investment of capital. The 

 whole supply curve will be raised ; assuming the demand to re- 

 main the same, Fig. 5, W D" will be the new increased number 

 of acres in cultivation, but land will be left uncultivated which 

 would have returned the interest M on capital. The volume 



