ADAM SMITH. 213 



II. CAPITAL. 



By capital, when used generally, we understand the whole 

 of the material world which man can appropriate, as well as 

 those talents, natural or acquired, which are the springs of his 

 exertions. In this sense of the word, it signifies all property 

 material and mental, or every thing valuable to man. Among 

 other things, it clearly comprehends land. But sometimes 

 we speak of capital, in opposition to land ; and, in this case, 

 it comprehends every thing valuable, except the ground ; for 

 it certainly includes all the parts and productions of the soil 

 which are severed from it. In this sense, the division nearly 

 resembles the legal distribution of property into real and per- 

 sonal. Both these definitions of capital are used repeatedly, 

 and with equal frequency, by every writer on political 

 economy. 



If capital is contradistinguished from land, the separation 

 is made by a most indefinite and obscure boundary. Canals, 

 roads and bridges, are as much a part of capital, as any por- 

 table machines, fashioned out of the produce or parts of 

 the soil. The same may be said of fences, drains, footways, 

 and in general of all the ostensible monuments of labour in 

 an improved farm. But is not the soil itself, also, referable 

 to the very same class, after it has been worked up with 

 manure and composts, so as to be highly fertilized ? Is not 

 the whole surface of an improved farm, therefore, to be con- 

 sidered as capital, rather than as land ? And when a person 

 buys a hundred acres of improved land, how can he say what 

 part of the price is paid for land, and what part for capital ? 

 We speak indeed of capital vested in land, and use the phrase, 



Trade. In stating the proportion of exports to imports, it has justly been 

 observed, that no notice can ever be taken, in Custom-house accounts, of 

 money remitted for subsidies, or for the payment of our troops and fleets 

 abroad. But it has very inaccurately been added, that these sums are so 

 much actually sent out of the country without an equivalent. In fact, the 

 equivalent is great and obvious, although of a nature which cannot be stated 

 in figures among the imports. The equivalent is all the success gained by 

 our foreign warfare and foreign policy the aggrandizement and security of 

 the State, and the power of carrying on that commerce, without which there 

 would be neither exports nor imports to calculate and compare. 



