and silver has been digested, and has circulated through the whole state, affairs will soon return to their former situation; while the landlords and new money-holders, living idly, squander above their income; and the former daily contract debt, and the latter encroach on their stock till its final extinction. The whole money may still be in the state, and make itself felt by the increase of prices: But not being now collected into any large masses or stocks, the disproportion between the borrowers and lenders is the same as formerly, and consequently the high interest returns. Accordingly we find, in Rome, that, so early as Tiberius's time, interest had again mounted to 6* per cent. though no accident had happened to drain the empire of money. In Trajan's time, money lent on mortgages in Italy, bore 6 per cent.†; on common securities in Bithynia, 12. And if interest in Spain has not risen to its old pitch, this can be ascribed to nothing but the continuance of the same cause that sunk it, to wit, the large fortunes continually made in the Indies, which come over to Spain from time to time, and supply the demand of the borrowers. By this accidental and extraneous cause, more money is to be lent in Spain, that is, more money is collected into large sums, than would otherwise be found in a state, where there are so little commerce and industry. As to the reduction of interest, which has followed in England, France, and other kingdoms of Europe, that have no mines, it has been gradual; and has not proceeded from the increase of money, considered merely in itself; but from that of industry, which is the natural effect of the former increase, in that interval, before it raises the * Columella, lib. iii. cap. 3. prices of labour and provisions. For to return to the foregoing supposition; if the industry of England had risen as much from other causes (and that rise might easily have happened, though the stock of money had remained the same), must not all the same consequences have followed, which we observe at present? The same people would in that case, be found in the kingdom, the same commodities, the same industry, manufactures, and commerce; and consequently the same merchants, with the same stocks, that is, with the same command over labour and commodities, only represented by a smaller number of white or yellow pieces; which, being a circumstance of no moment, would only affect the waggoner, porter, and trunk-maker. Luxury, therefore, manufactures, arts, industry, frugality, flourishing equally as at present, it is evident, that interest must also have been as low; since that is the necessary result of all these circumstances, so far as they determine the profits of commerce, and the proportion between the borrowers and lenders in any state. ESSAY V. OF THE BALANCE OF TRADE. It is very usual, in nations ignorant of the nature of commerce, to prohibit the exportation of commodities, and to preserve among themselves whatever they think valuable and useful. They do not consider, that, in this prohibition, they act directly contrary to their intention; and that the more is exported of any commodity, the more will be raised at home, of which they themselves will always have the first offer. It is well known to the learned, that the ancient laws of Athens rendered the exportation of figs criminal; that being supposed a species of fruit so excellent in Attica, that the Athenians deemed it too delicious for the palate of any foreigner. And in this ridiculous prohibition they were so much in earnest, that informers were thence called sycophants among them, from two Greek words, which signify figs and discoverer *. There are proofs in many old acts of parliament of the same ignorance in the nature of commerce, particularly in the reign of Edward III. And to this day, in France, the exportation of corn is almost prices of labour and provisions. For to return to the foregoing supposition; if the industry of England had risen as much from other causes (and that rise might easily have happened, though the stock of money had remained the same), must not all the same consequences have followed, which we observe at present? The same people would in that case, be found in the kingdom, the same commodities, the same industry, manufactures, and commerce; and consequently the same merchants, with the same stocks, that is, with the same command over labour and commodities, only represented by a smaller number of white or yellow pieces; which, being a circumstance of no moment, would only affect the waggoner, porter, and trunk-maker. Luxury, therefore, manufactures, arts, industry, frugality, flourishing equally as at present, it is evident, that interest must also have been as low; since that is the necessary result of all these circumstances, so far as they determine the profits of commerce, and the proportion between the borrowers and lenders in any state. ESSAY V. OF THE BALANCE OF TRADE. It is very usual, in nations ignorant of the nature of commerce, to prohibit the exportation of commodities, and to preserve among themselves whatever they think valuable and useful. They do not consider, that, in this prohibition, they act directly contrary to their intention; and that the more is exported of any commodity, the more will be raised at home, of which they themselves will always have the first offer. It is well known to the learned, that the ancient laws of Athens rendered the exportation of figs criminal; that being supposed a species of fruit so excellent in Attica, that the Athenians deemed it too delicious for the palate of any foreigner. And in this ridiculous prohibition they were so much in earnest, that informers were thence called sycophants among them, from two Greek words, which signify figs and discoverer *. There are proofs in many old acts of parliament of the same ignorance in the nature of commerce, particularly in the reign of Edward III. And to this day, in France, the exportation of corn is almost |