over; and though not moulded into that regularity which would properly fit them to be presented to the public, yet not less clearly put, I hope, than they appeared to you formerly.

1. If there are two articles proposed, one of export and one of import, and the advantages and disadvantages of exporting and selling the one, and with the proceeds of the sale buying and importing the other, be discussed, it is usual, I presume, to take into consideration the price at which the one (the article to be exported) can be furnished at home; and if it will not fetch that price, and even that price with a profit upon it in the other market, the one to which it is to be carried, to say that such article is exported at a loss, and that loss is actually sustained by such exportation; where the word loss is not used as a mere technical word expressive of a fact, but to denote real evil, real detriment.'

2. It is usual to consider the varied bounty or stinginess of nature in various countries, and to say that where the soil is ungrateful, or the disposition and power of the native inapt for a particular work, there with great toil and expense to produce an article, and export it to a country where it can be more cheaply and easily grown, is, in the very nature of things, trying to carry on a preposterous trade.

3. Again. A merchant selling a cargo in a foreign port at a loss, as it is called, (under prime cost, for example,) conceives that so far as that transaction goes, he suffers detriment; and it upon settling his accounts at home, after the sale of his return cargo, he finds that his time has been, on the whole, profitably employed, he places it solely to the account of the great profit he had on that return cargo, still thinking that he really lost by the sale of his outfit; but that the said profit on the return cargo was not only sufficient to counterbalance this loss, but over and above left him a reasonable net profit on the whole transaction; and the

There are instances where phrases that naturally and grammatically, as one may say, denote disadvantage, become the simple enunciation of a fact.

Such phrases are no doubt used, at first, in their natural sense. They arise from an apprehension and belief of certain injurious consequences. The apprehension may cease, and the phrase may remain. For example, the phrase "the balance of trade against" did once evidently express the opinion that a trade, by which more gold or silver was carried out of a country than brought into it, was against, and injurious to that country. Now, perhaps, it only expresses the above condition of that trade, viz. that by it, a diminution of gold and silver does take place.

It may be observed here, by the bye, that it would be well to get rid of these phrases, whose defined meaning is at variance with the sentiment naturally excited by them: for even the well-informed and accurate are entangled occasionally; and the mass of writers, readers, and talkers are absolutely unable, for five minutes together, to disenthral their minds from the influence of the natural import of the words.

statesmen, patriots, and others who speculate upon such transactions, are apt to regard them as unfavorable to the country so exporting; for though they allow (what they cannot deny) that the individual merchant has gained,' they are apt to say that the country has lost; and moreover such trade is in fact in various ways discouraged.

Now if the following investigation goes to show that these and the like reasonings and opinions are unfounded, it cannot be said to be merely conversant with verbal and nugatory distinctious; nor, if its principles are true, to be unimportant.

The advantage of any trade, where one article is to be exported, and either mediately or immediately to be exchanged for another to be imported, depends on the proportion between the quantities of the two articles that may be bought for the same price in the one market being effectually different from the proportion between the quantities of the same two articles that may be bought in the other market for one and the same price: that article, the home price of any proposed quantity of which will buy less of the other article (at home) than the foreign price of the same quantity of that article will abroad, being the one to export, and the other the one to import: in other words, that article (of the two) which is, relatively to the other, cheaper at home than abroad, being the one to export, and the other the one to import.

Observe; it matters nothing whether the article, thus comparatively cheaper, be really cheaper or dearer than in the other market; but only that it should be cheaper, if paid for in that other article. As for example, silk stockings, bought with brandy in England, may be cheaper than in Frauce. A gallon of brandy may buy more than in France; though perhaps, absolutely, silk stockings may be as cheap in France as in England, or cheaper.

It is not necessary, here, either that one or the other of the two quantities supposed to be bought in the one market, or that the price or sum proposed to buy them with, should be the same as in the other market, but only that the cost of the two things be the same in the same market, and the proportion between the quantities of things effectually different in the two markets.

Let A denote one species of goods, (of uniform quality,) B any other species. Let mA and nB be equivalent quantities in the

'It is not meant to be implied here, that whatever trade is profitable to the merchant and others employed in it, is therefore necessarily profitable to the country-(a trade may perhaps he very profitable to those concerned in it, and yet ruinous to the country,)-but only that no disadvantage to the country can be legitimately inferred from the circumstance of the exports being sold at or below prime cost.

home market; and let mA, n+r. B (nB+rB) be equivalent quantities in the other market."

For the sake of simplicity, I have taken the quantity of A the same in both markets. Now it is evident that m is greater with respect to n, than with respect to n+r; therefore, according to the above principle, the article A is proper to export and exchange for B, provided that the ratio of m to n+r be effectually different from the ratio of m to n; or, to speak somewhat more loosely, provided n+r be effectually greater than n; i. e. provided rB will pay, with reasonable profit, all the expenses of exporting and selling mA, and buying and importing and selling n+r.B.

For carrying out mA, he brings home n+r.B, (nB+rB). The sale of nB replaces mA, and there is over and above rB to pay the expenses; and it is manifest that it is upon this excess of n+r above n, and upon this alone, that the profit depends; and not at all upon what mA sells for in the foreign market. For example, mA may cost ten times as much at home as what it sold for abroad; yet the n+r. B, which is brought home, equally replaces mA, and leaves rB extra,3

These multipliers, m, n, r, are numbers of yards, of pounds, of gallons, of dozens, of units, &c. according to the nature of the articles. For example, if A be cloth, and B be hemp, and 50 yards of the cloth cost the same as 2 ton of the hemp, m and n denote 50 yards and 2 ton; or 100 yards and 4 ton; or, &c. Let us take m and n to be 50 yards and 2 ton; then if in the other market (Russia, for example) 50 yards of the cloth cost the same as 3 ton of the hemp, n+r will denote 3 ton, and r will denote 1 ton; i. e. r will be in.

2 There might be a difference so trifling as not to be worth considering. In order to distinguish the substantial differences, that will really pay for freight, time, &c. from such nugatory ones, I use the word effectual.

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3 The value or price (at home) of rB being the price of nB, the price of mA, (for mA and nB are supposed to be equivalent,) is the capital supposed to be employed in purchasing the outfit. Call this capital (in pounds sterling) P; and call the expense of freight, &c. sP. Also let the average time employed be T years, and let c per cent. per annum be a reasonable profit: the value of rB is "P; and the transaction is profitable, P be equal to or greater than sP+P+sP.100; i. e. (dividing by P) if be equal to, or greater than s +1+5.100 Example:-Let the time be a year, and the expenses of freight, &c. nothing; and 5 per cent. be a reasonable profit. Here s=0; T=1; c=5; therefore s+1+s. Too becomes 100 and the transaction is profitable, provided be as great as; for then P (the price of rB) will be Tooths or more of P; i. e. the profit 5 per cent. or

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Yes, that is true, it will be said; but there is loss on the outfit: there is loss on the sale of mA. Let us consider some of the absurdities contained in that proposition.

No doubt if a merchant buys mA at one price, P, and then in the same place immediately sells it for less, he loses the difference. He will find his loss, by trying to buy any thing equivalent to P or mA; for in what does the loss consist, but in his not being able to do that? But how does this apply to another place and market? He gave P for mA at home; suppose, to put a simple case, he can sell mA abroad for 1 P, i. e. half the prime cost: in the first place, if he chooses his property (P) to remain abroad, it is evident that he must pay all the expenses incident to its transfer there. But otherwise than that, he is not necessarily a loser. In some things his property (in the form of P now) is better than at home in the form of P. For example, it will purchase n+r.B; whereas at home it would only purchase nB.

In some things it is the same. For example, in the article A. In some things it is worse. For example, in the article P; being, by supposition, only worth half the quantity of that article it was at home.

But in general it is to be presumed (unless a case be purposely made to the contrary) that this mA, or its price P, will purchase the same things that mA or its price P will at home, i. e. if A is upon the whole in the same kind of estimation with respect to articles of general use as it is at home.

If the merchant himself should stay abroad, and at the same time should unfortunately have a peculiar attachment to some of those articles for which A cannot be so advantageously exchanged as at home; if, for example, he cannot be comfortable with using the article P in the same manuer as the natives do, then he might truly be said to be, in some sense, a loser, besides the expenses of his journey, &c. But a merchant's business is to send his property out, and bring it home again in another shape. Emigration is another concern.

But suppose he was to carry home the P; would he not be a loser? Yes, certainly; and so he would if he was to look about, and find any other article, C, whose equivalent with mA was less than its equivalent at home.-Suppose at home mA and dC to be equivalent, and in the foreign market mA and dC to be equivalent, then with respect to the article C, he is not so well off abroad with his mA as at home. And what prerogative has P, whether it be gold or silver, or any thing else, that it should be necessary to inquire into its relative value before he knows whether he can advantageously export A, rather than into the relative value of C?

Why not inquire into the value of coral, for example? Suppose I found that coral (C as above) was twice as dear (compared with A) abroad as at home. Then I lose upon coral, if I import it; and I lose (as they call it) in selling my outfit, if I keep my accounts in coral. Would this loss be imaginary? And if it be allowed to be so, how can the substitution of silver for coral make it real?

But further to show the absurdity, let us suppose it was contrived that the merchant should never know the prices of A and Babroad. Suppose him to procure and bring home his n+r. B,. without knowing any thing about that intermediate step, the selling mA for P. Now let him be asked if he sold his mA advantageously. What will he answer? He cannot say whether he did or not! But he is asked, " Did you lose (technically speaking), by the sale?" He cannot tell even that he only knows that he has made a profitable speculation; but whether he gained on the sale of mA, or on the sale of +r.B, or gained on them both, or gained on one and lost on the other, appears still undecided in his mind. He is at liberty to imagine' the whole profit divided in any proportion he pleases, between the sale of mA abroad, and the sale of nr. B at home. He is his own master; his arbitrary mental determination is the same as fact. The fact, a thing gone by and settled, seems to conform to his will and pleasure. That is strange! Or he really does not know. That is strange again ! that knowing all that has actually happened to him throughout the whole transaction, he should not know whether he lost any thing or not in the course of it! "The fox had a wound, but he could not tell where."

I have heard, from pretty good authority, that this kind of fiction was formerly practised, year after year, by the East India Company, in the sale of their woollen goods at Canton in China. They were in the habit, I am told, of engaging the Chinese merchants to agree to allow then more than the market price for the woollens, on condition of having it deducted again by an extra price laid on the teas. The object of this shifting was (I am told) to prevent the Company's losing by the sale of their exports. I am perfectly aware that the directors of the East India Company are too consummately skilled in mercantile affairs to have imagined that any increase of profit could really accrue to the Company from any shifting and juggling of this kind: but if the anecdote be true, it would show, would it not? that somebody is liable to be duped by it. The motive would be, I presume, to make it appear on the face of the transaction that no loss was sustained by the exports, and thereby to silence certain clamors at home. At any rate, whether the anecdote be true or not, (and I do not vouch for it,) the very circumstance that any person of sense should have believed it, and gravely have mentioned it to me as a skilful contrivance to evade loss, is sufficiently curious for me to bring forward as a case in point, showing the delusion that prevails on this subject.