Chapter I. Of Value.

of them exchanging, in the country, for a smaller quantity than before of the other produce of the country. To revert to our original figures [of the trade with Germany in cloth and linen]: in England, all consumers of linen obtained, after the trade was opened, seventeen or some greater number of yards for the same quantity of all other things for which they before obtained only fifteen. The degree of cheapness, in this sense of the term, depends on the laws of International Demand, so copiously illustrated in the preceding sections. (2.) But, in the other sense, that of cost, a country gets a commodity cheaper when it obtains a greater quantity of the commodity with the same expenditure of labor and capital. In this sense of the term, cheapness in a great measure depends upon a cause of a different nature: a country gets its imports cheaper, in proportion to the general productiveness of its domestic industry; to the general efficiency of its labor. The labor of one country may be, as a whole, much more efficient than that of another: all or most of the commodities capable of being produced in both may be produced in one at less absolute cost than in the other; which, as we have seen, will not necessarily prevent the two countries from exchanging commodities. The things which the more favored country will import from others are, of course, those in which it is least superior; but, by importing them, it acquires, even in those commodities, the same advantage which it possesses in the articles it gives in exchange for them. What her imports cost to her is a function of two variables: (1) the quantity of her own commodities which she gives for them, and (2) the cost of those commodities. Of these, the last alone depends on the efficiency of her labor; the first depends on the law of international values; that is, on the [pg 403] intensity and extensibility of the foreign