come to Amsterdam.

The natural refidence of CHAP.

fuch a merchant should either be at Konnigsberg
or Lifbon, and it can only be fome very particular
circumstances which 'can make him prefer the
refidence of Amsterdam. The uneafiness, how-
ever, which he feels at being feparated fo far
from his capital, generally determines him to
bring part both of the Konnigfberg goods which
he destines for the market of Lisbon, and of the
Lifbon goods which he deftines for that of Kon-
nigsberg, to Amsterdam: and though this ne
ceffarily fubjects him to a double charge of load-
ing and unloading, as well as to the payment of
fome duties and customs, yet for the fake of
having fome part of his capital always under his
own view and command, he willingly submits to
this extraordinary charge; and it is in this manner
that every country which has any confiderable
fhare of the carrying trade, becomes always the
emporium, or general market, for the goods of
all the different countries whose trade it carries
on. The merchant, in order to fave a fecond
loading and unloading, endeavours always to
fell in the home-market as much of the goods of
all those different countries as he can, and thus,
fo far as he can, to convert his carrying trade
into a foreign trade of confumption. A mer.
chant, in the fame manner, who is engaged in
the foreign trade of confumption, when he col-
lects goods for foreign markets, will always be
glad, upon equal or nearly equal profits, to fell
as great a part of them at home as he can.
faves himself the rifk and trouble of exportation,

N2

He

when,

II.

IV.

BOOK when, so far as he can, he thus converts his foreign trade of confumption into a home-trade. Home is in this manner the center, if I may fay fo, round which the capitals of the inhabitants of every country are continually circulating, and towards which they are always tending, though by particular causes they may sometimes be driven off and repelled from it towards more distant employments. But a capital employed in the home-trade, it has already been shown, neceffarily puts into motion a greater quantity of domeftic industry, and gives revenue and employment to a greater number of the inhabitants of the country, than an equal capital employed in the foreign trade of confumption: and one employed in the foreign trade of confumption has the fame advantage over an equal capital employed in the carrying trade. Upon equal, or only nearly equal profits, therefore, every individual naturally inclines to employ his capital in the manner in which it is likely to afford the greatest fupport to domestic industry, and to give revenue and employment to the greatest number of people of his own country.

Secondly, every individual who employs his capital in the support of domeftic industry, neceffarily endeavours so to direct that industry, that its produce may be of the greatest poffible value

The produce of industry is what it adds to the subject or materials upon which it is employed. In proportion as the value of this produce is great or small, fo will likewise be the profits of the employer. But it is only for the fake of profit

II.

1

that any man employs a capital in the support of CHAP. industry; and he will always, therefore, endeavour to employ it in the support of that industry of which the produce is likely to be of the greatest value, or to exchange for the greatest quantity either of money or of other goods.

But the annual revenue of every society is always precifely equal to the exchangeable value of the whole annual produce of its industry, or rather is precifely the fame thing with that exchangeable value. As every individual, therefore, endeavours as much as he can both to employ his capital in the support of domeftic industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cafes, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the fociety more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. It is an affectation,

N 3

IV.

BOOK affectation, indeed, not very common among merchants, and very few words need be employed in diffuading them from it.

What is the species of domestic industry which his capital can employ, and of which the produce is likely to be of the greatest value, every individual, it is evident, can, in his local fituation, judge much better than any statefman or lawgiver can do for him. The statesman, who should attempt to direct private people in what manner they ought to employ their capitals, would not only load himself with a most unneceffary attention, but affume an authority which could fafely be trusted, not only to no fingle perfon, but to no council or fenate whatever, and which would no-where be so dangerous as in the hands of a man who had folly and prefumption enough to fancy himself fit to exercise it.

To give the monopoly of the home-market to the produce of domestic industry, in any particular art or manufacture, is in fome meafure to direct private people in what manner they ought to employ their capitals, and must, in almost all cafes, be either a useless or a hurtful regulation. If the produce of domeftic can be brought there as cheap as that of foreign industry, the regulation is evidently useless. If it cannot, it must generally be hurtful. It is the maxim of every prudent mafter of a family, never to attempt to make at home what it will cost him more to make than to buy. The taylor does not attempt to make his own shoes, but buys them of the shoemaker. The fshoemaker does not attempt to make his own clothes, but employs a taylor. CHAP. The farmer attempts to make neither the one II. nor the other, but employs those different artificers. All of them find it for their intereft to employ their whole industry in a way in which they have fome advantage over their neighbours, and to purchase with a part of its produce, or what is the fame thing, with the price of a part of it, whatever elfe they have occafion for.

What is prudence in the conduct of every private family, can fcarce be folly in that of a great kingdom. If a foreign country can fupply us with a commodity cheaper than we ourselves can make it, better buy it of them with fome part of the produce of our own industry, employed in a way in which we have fome advantage. The general industry of the country, being. always in proportion to the capital which employs it, will not thereby be diminished, no more than that of the above-mentioned artificers; but only left to find out the way in which it can be employed with the greatest advantage. It is certainly not employed to the greatest advantage, when it is thus directed towards an object which it can buy cheaper than it can make. The value of its annual produce is certainly more or lefs diminished, when it is thus turned away from producing commodities evidently of more value than the commodity which it is directed to produce. According to the fuppofition, that commodity could be purchased from foreign countries cheaper than it can be made at home. It could, therefore, have been purchased with a part only