Henry Charles Carey Rent

Henry Charles Carey Rent

In his Principles of Political Economy, Carey as­sented to Ricardo's opinion that the best lands are cultivated first. He did not, however, even then acknowledge that Ricar­do's theory of rent was correct; since he held that the value of commodities depends upon the cost of reproduction, and that the cost of producing agricultural commodities, or food and raw material, decreases with general progress.
He felt, however, that his theory was still incomplete. In the preface to his Principles of Social Science he says of the earlier work: —

"He had already satisfied himself that the theory presented for consideration by Mr. Ricardo — not being universally true — had no claim to be so considered; but it was not until ten years later that he was led to remark the fact that it was universally false. The real law, as he then saw, was directly the reverse of that pro­pounded by that gentleman, the work of cultivation having, and that invariably, been commenced on the poorer soils, and having passed to the richer ones as wealth had grown and population had increased. Here was the great fundamental truth of which he be­fore had thought, and the one, too, that was needed for the perfect demonstration of the truth of those he previously had published. Here, too, was further proof of the universality of natural laws, the course of man in reference to the earth itself being thus found to have been the same that we see it to have been, in reference to all the instruments into which he fashions the several parts of the great machine. Always commencing with the poorest axes, he proceeds onward to those of steel; always commencing with the poorer soils, he proceeds onward to those richer ones which yield the largest return to labor, the increase of numbers being thus proved to be essential to the increase in the supply of food. Here was a harmony of interests directly opposed to the discords taught by Mr. Malthus."

This great law, as Carey calls it, was first announced to the world in 1848 in The Past, the Present, and the Future.

Carey maintains that experience shows that at first men take up poor soils, because they are light and sandy and easier to cultivate. Men begin to cultivate the hills, and when the poor­est land is exhausted and numbers and knowledge have in­creased, they work down toward the rivers and make use of the rich valleys. The last settlers, therefore, receive the best land.

Labor becomes continually more productive, wealth increases, and man progresses.

The earth is only the material of a machine which the agri­culturist makes and calls a farm. He can obtain for it at most only what it has cost him, for plenty of this material remains, and others will construct machines for themselves rather than pay more. In fact, the farmer cannot, as a rule, obtain so much for his machine as it cost him, because the material remaining is better and man learns how to work with less cost. He is able to obtain only what it would cost to reproduce it. It is the same as with an ax which may have been manufactured ten years before. The owner cannot obtain what it cost him, but only what it would cost to make another one at the present time. There is no essential difference between the farmer and any other capitalist. The farm simply represents so much capital.

Carey seeks the aid of history in the development of his theories, but his knowledge appears to have been as limited as his critical faculty. It is true that, in many places, people have first settled on high land, but some of the causes which have led them to do so have not been at all of an agricultural nature, as for example the desire for defense or to secure freedom from disease.1 As was easy under the circumstances, he over­estimated his discoveries and gave them a universality which does not belong to them. It is going too far to intimate that the poorer lands are always first cultivated, however the quality be estimated. Can any one imagine that a farmer who has the choice would deliberately pick out that land for cultivation which yields the least return to his labor and capital? As Lange says: "Even unfruitful heaths and hillsides are gradually brought into a state of cultivation. This is what I see every day in my home on the lower Rhine and in Westphalia, where agriculture and manufactures flourish together, and is therefore a fact which no Carey can convince me to be untrue."

Again, Carey clearly does not understand Ricardo's theory, or at least does not represent it fairly. The fruitfulness of land is a relative conception. If a certain amount of capital and labor will yield more when applied to a light than to a heavy soil, the light soil is, in the sense of Ricardo's theory of rent, the more fruitful, although it may be possible to produce more on the heavier soil by applying a greater amount of labor.

It may be that Ricardo himself did not bring this out with sufficient clearness. In fact, it is owing to Carey's opposition that Ricardo's followers have been led to explain so precisely as they have what is to be understood by good, better, and best land. Carey attacked Ricardo with so much force and ability that it compelled economists to go over again the whole ground of the theory of rent. The result has been a correction and amplification. This is Carey's service.