who has contracted to pay rent. Granted the surplus, nothing is plainer than that the cultivator would retain it if he could. "It is," as Ricardo remarks, "one thing to be able to bear a high rent, and another thing actually to pay it."[1] What needs to be explained is not how the cultivator can pay rent, but why he must. Adam Smith observed that, "as soon as the land becomes private property, the landlord demands a share of almost all the produce." But he did not explain why the cultivator accedes to this unwelcome demand, and his explanation of rent was incomplete in consequence. The so-called Ricardian theory of rent supplies this gap by means of the Law of Diminishing Returns. Any theory which does not contain this is something less than Ricardian.
There was probably nothing to suggest diminishing returns to Petty. Mr. Cannan has shown[2] how the notion that additional supplies of food must be secured at increased cost was a natural conclusion from the conditions that preceded and indeed evoked Malthus's Inquiry into the Nature and Progress of Rent. In Petty's time, circumstances were quite otherwise. The year in which he wrote, to be sure, was a time of dearth approaching famine.[3] But no such extreme and continued rise of prices as occurred between 1790 and 1815 had taken place within his recollection. Moreover, his warm friend, Hartlib, had published a book professing to show that by the use of agricultural methods prevailing in Brabant and Flanders all sorts of crops might be enormously increased in England.[4] Petty was by temperament inclined to experiment and to improve. He probably knew, as every
- ↑ Chapter on "Mr. Malthus's Opinions on Rent" in Ricardo's Principles, p. 559 of 1817 edition.
- ↑ "The Origin of the Law of Diminishing Returns," in Economic Journal, March, 1892, ii. 53-69, also in his Theories of Production and Distribution (1894), 147-168.
- ↑ Rogers's History of Agriculture and Prices, v. 213-215.
- ↑ Legacie of Husbandry, 1655.
