INFLUENCE OE EECENT GOLD DISCOYEEIES ON PKICES. 439 



The truth of the last remark is forcibly illustrated by Australian 

 statistics ; from official statements of the imports to Sydney, we find 

 that the average amount of the imports for the ten years preceding 

 the gold discoveries was little more than £1,000,000 sterling, while 

 in 1853 and 1S54 the annual imports to that port averaged fully 

 £6,000,000. 



The prices of labour and of commodities in Great Britain and 

 the States must therefore have been raised in virtue of both the 

 causes which I have pointed out ; for whilst the supply of labour and 

 commodities in those countries was reduced, the demand for labour 

 and commodities was actually increased. 



We now come to consider the third, and, doubtless, the most 

 influential as well as the most obvious of the assigned causes of 

 the fall of the value of gold in the gold importing countries. I 

 mean the sudden and extraordinary augmentation in the mass of 

 the precious metal as compared with the mass of commodities in 

 those countries. ]S"o one can doubt that if the mass of the precious 

 metal in the world became suddenly doubled or trebled, the prices 

 of all commodities would at once be doubled or trebled as the case 

 might be. Such sudden changes iu the mass of the precious metals 

 are of course impossible ; changes in the amount of the metallic cur- 

 rency when they do occur, are generally, as has already been observed, 

 the gradual result of years, and when this is the case the ultimate 

 effect of the increase of the precious metals on prices may be ma- 

 terially modified by the change which has taken place simultaneously 

 in the value of the aggregate of commodities. 



Prices (so far as they are affected by the cause under consider- 

 ation) would rise or fall according to the relative increase in the 

 mass of metal and commodities. If the mass of the precious metals 

 had outstripped in its growth the mass of commodities, prices would 

 be raised. If, on the other hand, commodities had increased more 

 rapidly than the metals the prices of commodities would be lowered. 



There can be little doubt, I imagine, that since the gold discoveries 

 in California and Australia, gold has been increasing much more 

 rapidly than commodities, and consequently (in obedience to the law 

 just stated), the prices of commodities must, as a matter of con, 

 have been raised during that period. 



At the beginning of the present century the annual value of the 

 precious metals raised from all the mines of the world, was, according 

 to the calculation of Humboldt, somewhat under £10,000,000 sterling, 

 From 1800 to 1810 (owing to the increasing yield during that 

 period of the American mines), the total annual produce steadily 



