SECRETARY'S REPORT. 187 



Gentlemen of the Board of Agriculture, — I should not ap{x>ar 

 bctbro you without a full manuscript, did my eyes allow me to 

 read it in the evening. I must, therefore, crave your allowance 

 for any defects that the form of my remarks may present. My 

 subject is 



THE POLITICAL ECONOMY OF AGRICULTURE. 



Political economy treats of the principles on which all produc- 

 tion depends, while it leaves to each branch, as to the art of agri- 

 culture, those specific rules by which its own ends are to be 

 reached. 



I invite your attention to the law of profits in manufactures 

 as contrasted with that of agriculture. It is this: With each 

 increase of capital there tends to be a yet greater increase of 

 profits. This arises from a variety of reasons, some of which 1 

 will mention. As capital enlarges, it secures a more thorough 

 command of machinery. We are hero speakuig of a simple 

 increase of capital, without increase of skill. Larger caj)itals 

 can avail themselves perfectly of the best machinery and of the 

 best skill. They can also secure the fruits of division of labor, 

 a])plying the least skilled labor to the ruder forms of production, 

 and more skilled labor to the more ditlicult forms. A third 

 reason for this growth of profits is, that the several processes of 

 manufacture can go on at the same time, mutually sustaining 

 each other. In the carriage shop, the work in wire and wood, 

 the painting and upholstery, can proceed together, and each with 

 the neetlful quota of hands. It is often a matter of great con- 

 venience and economy that the ditlicult ])arts of the process 

 should be carried on within the same building, and thus the 

 several operations complete themselves readily and rapidly. 



There can also be a more economical use of the iuaterial 

 employed, so that much (hat would bo lost in a small cstabUsh- 

 ment, in a large one will bo saved. In the lumber business, for 

 iustajice, that which cannot be used for boards may be sawed 

 into laths, and in the variety of demand each log bo cut 

 according to its fitness, with highest economy of value. 



A further reason is, that as capital increases, there is a better 

 command of the market, both in buying and selling, lie who 

 sells largely has an advantage over him who has but little to 

 sell ; so, also, in buying, lie may dispense with a middle miuiy. 



