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nydus/An Inquiry into the Nature and Causes of the Wealth of NationsPublic

Adam Smith examines how the annual labor of a nation determines the supply of necessities and conveniences available to its population. He analyzes how the skill of the workforce and the ratio of productive to unproductive laborers influence a society's overall wealth and standard of living.

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Table of Contents

CHAPTER II. OF THE SOURCES OF THE GENERAL OR PUBLIC REVENUE OF THE SOCIETY.

obliged either to raise the rate of his profit, or to charge the tax upon the interest of money; that is, to pay less interest. If he raised the rate of his profit in proportion to the tax, the whole tax, though it might be advanced by him, would be finally paid by one or other of two different sets of people, according to the different ways in which he might employ the stock of which he had the management. If he employed it as a farming stock, in the cultivation of land, he could raise the rate of his profit only by retaining a greater portion, or, what comes to the same thing, the price of a greater portion, of the produce of the land; and as this could be done only by a reduction of rent, the final payment of the tax would fall upon the landlord. If he employed it as a mercantile or manufacturing stock, he could raise the rate of his profit only by raising the price of his goods; in which case, the final payment of the tax would fall altogether upon the consumers of those goods. If he did not raise the rate of his profit, he would be obliged to charge the whole tax upon that part of it which was allotted for the interest of money. He could afford less interest for whatever stock he borrowed, and the whole weight of the tax would, in this case, fall ultimately upon the interest of money. So far as he could not relieve himself from the tax in the one way, he would be obliged to relieve himself in the other.

The interest of money seems, at first sight, a subject equally capable of being

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