contains its full standard weight, the 
coinage costs nothing to any body; and if it 
is short of that weight, the coinage must always 
cost the difference between the quantity 
of bullion which ought to be contained in it, 
and that which actually is contained in it. 
 
The government, therefore, when it defrays 
the expense of coinage, not only incurs some 
small expense, but loses some small revenue 
which it might get by a proper duty; and 
neither the bank, nor any other private persons
are in the smallest degree benefited by 
this useless piece of public generosity. 
 
The directors of the bank, however, would 
probably be unwilling to agree to the imposition 
of a seignorage upon the authority of a 
speculation which promises them no gain, but 
only pretends to insure them from any loss
In the present state of the gold coin, and as 
long as it continues to be received by weight
they certainly would gain nothing by such a 
change. But if the custom of weighing the 
gold coin should ever go into disuse, as it is 
very likely to do, and if the gold coin should 
ever fall into the same state of degradation in 
which it was before the late recoinage, the 
gain, or more properly the savings, of the 
bank, in consequence of the imposition of a 
seignorage, would probably be very considerable
The bank of England is the only company 
which sends any considerable quantity 
of bullion to the mint, and the burden of the 
annual coinage falls entirely, or almost entirely, 
upon it. If this annual coinage had 
nothing to do but to repair the unavoidable 
losses and necessary wear and tear of the 
coin, it could seldom exceed fifty thousand
or at most a hundred thousand pounds. But 
when the coin is degraded below its standard 
weight, the annual coinage must, besides this, 
fill up the large vacuities which exportation 
and the melting pot are continually making 
in the current coin. It was upon this account
that during the ten or twelve years 
immediately preceding the late reformation of 
the gold coin, the annual coinage amounted
at an average, to more than L.850,000. But 
if there had been a seignorage of four or five 
per cent. upon the gold coin, it would probably, 
even in the state in which things then 
were, have put an effectual stop to the business 
both of exportation and of the melting 
pot. The bank, instead of losing every year 
about two and a half per cent. upon the bullion 
which was to be coined into more than 
eight hundred and fifty thousand pounds, or 
incurring an annual loss of more than twenty-one 
thousand two hundred and fifty pounds
would not probably have incurred the tenth 
part of that loss
 
The revenue allotted by parliament for defraying 
the expense of the coinage is but fourteen 
thousand pounds a-year; and the real 
expense which it costs the government, or the 
fees of the officers of the mint, do not, upon 
ordinary occasions, I am assured, exceed the 
half of that sum. The saving of so very small 
a sum, or even the gaining of another, which 
could not well be much larger, are objects 
too inconsiderable, it may be thought, to deserve 
the serious attention of government
But the saving of eighteen or twenty thousand 
pounds a-year, in case of an event which 
is not improbable, which has frequently happened 
before, and which in very likely to happen 
again, is surely an object which well deserves 
the serious attention, even of so great
company as the bank of England. 
 
Some of the foregoing reasonings and observations 
might, perhaps, have been more 
properly placed in those chapters of the first 
book which treat of the origin and use of 
money, and of the difference between the real 
and the nominal price of commodities. But 
as the law for the encouragement of coinage 
derives its origin from these vulgar prejudices 
which have been introduced by the mercantile 
system, I judged it more proper to reserve 
them for this chapter. Nothing could be more 
agreeable to the spirit of that system than a 
sort of bounty upon the production of money
the very thing which, it supposes, constitutes 
the wealth of every nation. It is one of its 
many admirable expedients for enriching the 
country. 
 
 
 
 
CHAP. VII. 
 
OF COLONIES. 
 
PART I. 
 
Of the Motives for Establishing New Colonies. 
 
The interest which occasioned the first settlement 
of the different European colonies in 
America and the West Indies, was not altogether 
so plain and distinct as that which directed 
the establishment of those of ancient 
Greece and Rome
 
All the different states of ancient Greece 
possessed, each of them, but a very small territory; 
and when the people in any one of 
them multiplied beyond what that territory 
could easily maintain, a part of them were 
sent in quest of a new habitation, in some remote 
and distant part of the world; the war-like 
neighbours who surrounded them on all 
sides, rendering it difficult for any of them to 
enlarge very much its territory at home. The 
colonies of the Dorians resorted chiefly to 
Italy and Sicily, which, in the times preceding 
the foundation of Rome, were inhabited 
by barbarous and uncivilized nations; those 
of the Ionians and ├ćolians, the two other 
great tribes of the Greeks, to Asia Minor and