Ch. V. Of P 007^- Laws. 73 



the Bank of England, though changed in its na- 

 ture, had not been much increased in its quantity; 

 and with regard to the effect of the circulating 

 medium on the prices of all commodities, it cannot 

 be doubted that it would be precisely the same, 

 whether this medium were made up principally 

 of guineas, or of pound-notes and shillings which 

 would pass current for guineas. 



The demand, therefore, for an increased circu- 

 lating medium was left to be supplied principally 

 by the country banks, and it could not be ex- 

 pected that they should hesitate in taking advan- 

 tage of so profitable an opportunity. The paper 

 issues of a country bank are, as I conceive, mea- 

 sured by the quantity of its notes which will 

 remain in circulation ; and this quantity is again 

 measured, supposing a confidence to be establish- 

 ed, by the sum of what is wanted to carry on all 

 the money transactions of the neighbourhood. 

 From the high price of provisions, all these trans- 

 actions becam.e more expensive. In the single 

 article of the weekly payment of labourers' wages, 

 including the parish allowances, it is evident that 

 a very great addition to the circulating medium 

 of the neighbourhood would be wanted. Had the 

 country banks attempted to issue the same quanti- 

 ty of paper without such a particular demand for it, 

 they would quickly have been admonished of their 

 error by its rapid and pressing return upon them ; 

 but at this time it was wanted for immediate and 

 daily use, and was, therefore, eagerly absorbed 

 into the circulation. 



