neighbourhood, there is more exchange and commerce of all kinds, and more money enters into that exchange. The tradesmen will not be paid in corn, because they want something more than barley to eat. The farmer goes beyond his own parish for the commodities he purchases, and cannot always carry his commodities to the merchant who supplies him. The landlord lives in the capital, or in a foreign country, and demands his rent in gold and silver, which can easily be transported to him. Great undertakers, and manufacturers, and merchants arise in every commodity; and these can conveniently deal in nothing but in specie. And consequently, in this situation of society, the coin enters into many more contracts, and by that means is much more employed than in the former.
The necessary effect is, that, provided the money does not increase in the nation, everything must become much cheaper in times of industry and refinement than in rude, uncultivated ages. It is the proportion between the circulating money and the commodities in the market which determines the prices. Goods that are consumed at home, or exchanged with other goods in the neighbourhood, never come to market; they affect not in the least the current specie; with regard to it they are as if totally annihilated; and consequently this method of using them sinks the proportion on the side of the commodities and increases the prices. But after money enters into all contracts and sales, and is everywhere the measure of exchange, the same national cash has a much greater task to perform: all commodities are then in the market; the sphere of circulation is enlarged; it is the same case as if that individual sum were to serve a larger kingdom; and therefore, the {p37} proportion being here lessened on the side of the money, everything must become cheaper, and the prices gradually fall.
By the most exact computations that have been formed all over Europe, after making allowance for the alteration in the numerary value or the denomination, it is found that the prices of all things have only risen