David Ricardo

Excerpts from:
"On The Principles of Political Economy and Taxation"

DAVID RICARDO  at the New School

RICARDO  at the Victorian Web

RICARDO  The New Palgrave

DAVID RICARDO   Brief Biography

RICARDO Principles of Pol. Econ.

RICARDO   Iron Law of Wages

On Value, Rent, Wages and Profits

On Principles of Political Economy

On Comparative Advantage

   An Essay on Profits

The produce of the earth - all that is derived from its surface by the united application of labour, machinery, and capital, is divided among three classes of the community; namely, the proprietor of the land, the owner of the stock of capital necessary for its cultivation, and the labourers by whose industry it is cultivated......To determine the laws which regulate this distribution, is the principal problem in Political Economy.

The value of a commodity, or the quantity of any other commodity for which it will exchange, depends on the relative quantity of labour which is necessary for its production.....commodities derive their exchangeable value from two sources: from their scarcity, and from the quantity of labour required to obtain them.

 There are some commodities, the value of which is determined by their scarcity alone. No labour can increase the quantity of such goods, and therefore their value cannot be lowered by an increased supply. Some rare statues and pictures, scarce books and coins, wines of a peculiar quality, which can be made only from grapes grown on a particular soil, of which there is a very limited quantity, are all of this description... These commodities, however, form a very small part of the mass of commodities daily exchanged in the market.

By far the greatest part of those goods which are the objects of desire, are procured by labour, and they may be multiplied, not in one country alone, but in many, almost without any assignable limit, if we are disposed to bestow the labour necessary to obtain them. 

There can be no rise in the value of labour without a fall of profits. If the corn is to be divided between the farmer and the labourer, the larger the proportion that is given to the latter, the less will remain for the former.....Adam Smith, and all the writers who have followed him, have, without one exception that I know of, maintained that a rise in the price of labour would be uniformly followed by a rise in the price of all commodities. I hope I have succeeded in showing, that there are no grounds for such an opinion.