THE

ELEMENTS

OF

POLITICAL ECONOMY.

BY

HENRY DUNNING MACLEOD.

Ne nous imaginons pas que le vrai soit victorieux dès qu'il se montre; Il l'est à la fin, mais il
lui faut du temps pour soumettre les esprits.

FONTENELLE. Vie de Corneille.

LONDON:

LONGMAN, BROWN, GREEN, LONGMANS, AND ROBERTS.

MDCCCLVIII.

THE AUTHOR RESERVES THE RIGHT OF TRANSLATION,

HARVARD UNIVERSITY

AUG 2 0 1991

KING & CO., PRINTERS, QUEEN STREET, CITY.

PREFACE.

The purpose of the following work is to strengthen and establish the new conceptions and principles in Political Economy propounded in my Theory and Practice of Banking. In order to treat that subject properly, I found it necessary to lay altogether new foundations of the science. But I was subject to a certain disadvantage. For to establish a new set of opinions, an unusual amount of discussion and controversy is necessary. But to do this in a thoroughly efficient manner, would have led to an inordinate increase of a work, whose plan already extended over a wide range of subjects. I was, therefore, in a certain measure cramped to a more confined discussion than the nature of the case really demanded, to have justice done to it. The object, therefore, of the present work is to widen and strengthen the foundations of the science, as treated in that work. It has, therefore, a very considerable portion in common with it; and those parts of the former work, which are of general application, are incorporated with this one.

The view that I take of the proper limits of the pure science of Political Economy, entirely differs from that

of

any

of the larger and well-known Treatises on it. In my view the true object of the pure science of Political Economy is to discover the laws that regulate the Exchangeable Relations of Quantities. This coincides, I think, pretty closely, with the ideas of at least one eminent writer-Archbishop Whately. I however think it right to say, that I formed this opinion of the subject quite independently, and, indeed, before I was acquainted with his lectures. The same conception seems also to have occurred to other writers, but no one has hitherto executed a comprehensive work, founded upon this conception. The views held by preceding writers, and the reasons which have led me to endeavour to found a system on this conception, are shortly stated in the preliminary observations.

Political Economy, like geology, is preeminently a practical science. There is no more grievous error, than to suppose that it can be constructed solely in the closet, like some abstract sciences. On the contrary, it requires a familiar practical knowledge of a considerable variety of subjects. Nature is far more subtle than the acutest intellect of man, says Bacon, and in practice there occur a great variety of circumstances of the first importance in Political Economy, but which would only occur to a person practically familiar with the subject. Moreover it is indispensably necessary that these facts, and their relations, should be expressed in language governed by the most rigorous scientific precision.

The forces which produce the phenomena of Political Economy are equally certain, precise, and unerring, as those in Mechanics, and they must be expressed in lan guage subject to the same scientific control. Political Economy will never be brought to a satisfactory state, until the meaning of every single term is as rigidly set