it for something for which there is a demand 
at home. It as effectually replaces the capital 
of the person who produces that surplus, and 
as effectually enables him to continue his business, 
the service by which the capital of a 
wholesale merchant chiefly contributes to support 
the productive labour, and to augment 
the value of the annual produce of the society 
to which he belongs
It is of more consequence that the capital 
of the manufacturer should reside within the 
country. It necessarily puts into motion
greater quantity of productive labour, and adds 
a greater value to the annual produce of the 
land and labour of the society. It may, however, 
be very useful to the country, though it 
should not reside within it. The capitals of 
the British manufacturers who work up the 
flax and hemp annually imported from the 
coasts of the Baltic, are surely very useful to 
the countries which produce them. Those 
materials are a part of the surplus produce of 
those countries, which, unless it was annually 
exchanged for something which is in demand 
there, would be of no value, and would soon 
cease to be produced. The merchants who 
export it, replace the capitals of the people 
who produce it, and thereby encourage them 
to continue the production; and the British 
manufacturers replace the capitals of those 
A particular country, in the same manner 
as a particular person, may frequently not 
have capital sufficient both to improve 
cultivate all its lands, to manufacture and prepare 
their whole rude produce for immediate 
use and consumption, and to transport the 
surplus part either of the rude or manufactured 
produce to those distant markets, where it 
can be exchanged for something for which 
there is a demand at home. The inhabitants 
of many different parts of Great Britain have 
not capital sufficient to improve and cultivate 
all their lands. The wool of the southern 
counties of Scotland is, a great part of it, after 
a long land carriage through very bad 
roads, manufactured in Yorkshire, for want of 
a capital to manufacture it at home. There 
are many little manufacturing towns in Great 
Britain, of which the inhabitants have not capital 
sufficient to transport the produce of 
their own industry to those distant markets 
where there is demand and consumption for it. 
If there are any merchants among them, they 
are, properly, only the agents of wealthier 
merchants who reside in some of the great 
commercial cities
When the capital of any country is not sufficient 
for all those three purposes, in proportion 
as a greater share of it is employed in agriculture, 
the greater will be the quantity of 
productive labour which it puts into motion 
within the country; as will likewise be the value 
which its employment adds to the annual 
produce of the land and labour of the society
After agriculture, the capital employed in manufactures 
puts into motion the greatest quantity 
of productive labour, and adds the greatest 
value to the annual produce. That which 
is employed in the trade of exportation has the 
least effect of any of the three. 
The country, indeed, which has not capital 
sufficient for all those three purposes, has not 
arrived at that degree of opulence for which 
it seems naturally destined. To attempt, 
however, prematurely, and with an insufficient 
capital, to do all the three, is certainly not the 
shortest way for a society, no more than it 
would be for an individual, to acquire a sufficient 
one. The capital of all the individuals 
of a nation has its limits, in the same manner 
as that of a single individual, and is capable of 
executing only certain purposes. The capital 
of all the individuals of a nation is increased in 
the same manner as that of a single individual
by their continually accumulating and adding 
to it whatever they save out of their revenue
It is likely to increase the fastest, therefore, 
when it is employed in the way that affords 
the greatest revenue to all the inhabitants of 
the country, as they will thus be enabled to 
make the greatest savings. But the revenue 
of all the inhabitants of the country is necessarily 
in proportion to the value of the annual 
produce of their land and labour
It has been the principal cause of the rapid 
progress of our American colonies towards 
wealth and greatness, that almost their whole 
capitals have hitherto been employed in agriculture. 
They have no manufactures, those 
household and coarser manufactures excepted
which necessarily accompany the progress of 
agriculture, and which are the work of the 
women and children in every private family. 
The greater part, both of the exportation and 
coasting trade of America, is carried on by 
the capitals of merchants who reside in Great 
Britain. Even the stores and warehouses from 
which goods are retailed in some provinces, 
particularly in Virginia and Maryland, belong 
many of them to merchants who reside in the 
mother country, and afford one of the few 
instances of the retail trade of a society being 
carried on by the capitals of those who are 
not resident members of it. Were the Americans
either by combination, or by any other 
sort of violence, to stop the importation of 
European manufactures, and, by thus giving 
a monopoly to such of their own countrymen 
as could manufacture the like goods, divert 
any considerable part of their capital into this 
employment, they would retard, instead of accelerating, 
the further increase in the value 
of their annual produce, and would obstruct
instead of promoting, the progress of their 
country towards real wealth and greatness
This would be still more the case, were they 
to attempt, in the same manner, to monopolize 
to themselves their whole exportation