distant employments. The trade to the East 
Indies, if it were altogether free, would probably 
absorb the greater part of this redundant 
capital. The East Indies offer a market 
both for the manufactures of Europe, and for 
the gold and silver, as well as for the several 
other productions of America, greater and 
more extensive than both Europe and America 
put together. 
Every derangement of the natural distribution 
of stock is necessarily hurtful to the 
society in which it takes place; whether it be 
by repelling from a particular trade the stock 
which would otherwise go to it, or by attracting 
towards a particular trade that which 
would not otherwise come to it. If, without 
any exclusive company, the trade of Holland 
to the East Indies would be greater than it 
actually is, that country must suffer a considerable 
loss, by part of its capital being excluded 
from the employment most convenient 
for that port. And, in the same manner, if, 
without an exclusive company, the trade of 
Sweden and Denmark to the East Indies 
would be less than it actually is, or, what perhaps 
is more probable, would not exist at all, 
those two countries must likewise suffer a 
considerable loss, by part of their capital being 
drawn into an employment which must 
be more or less unsuitable to their present circumstances. 
Better for them, perhaps, in the 
present circumstances, to buy East India 
goods of other nations, even though they 
should pay somewhat dearer, than to turn so 
great a part of their small capital to so very 
distant a trade, in which the returns are so 
very slow, in which that capital can maintain 
so small a quantity of productive labour at 
home, where productive labour is so much 
wanted, where so little is done, and where so 
much is to do. 
Though without an exclusive company
therefore, a particular country should not be 
able to carry on any direct trade to the East 
Indies, it will not from thence follow, that 
such a company ought to be established there, 
but only that such a country ought not, in 
these circumstances, to trade directly to the 
East Indies. That such companies are not 
in general necessary for carrying on the East 
India trade, is sufficiently demonstrated by 
the experience of the Portuguese, who enjoyed 
almost the whole of it for more than a 
century together, without any exclusive company
No private merchant, it has been said, 
could well have capital sufficient to maintain 
factors and agents in the different ports of the 
East Indies, in order to provide goods for 
the ships which he might occasionally send 
thither; and yet, unless he was able to do 
this, the difficulty of finding a cargo might 
frequently make his ships lose the season for 
returning; and the expense of so long a delay 
would not only eat up the whole profit of 
the adventure, but frequently occasion a very 
considerable loss. This argument, however, 
if it proved any thing at all, would prove 
that no one great branch of trade could be 
carried on without an exclusive company
which is contrary to the experience of all nations
There is no great branch of trade, in 
which the capital of any one private merchant 
is sufficient for carrying on all the subordinate 
branches which must be carried on, in 
order to carry on the principal one. But 
when a nation is ripe for any great branch of 
trade, some merchants naturally turn their 
capitals towards some principal, and some towards 
the subordinate branches of it; and 
though all the different branches of it are in 
this manner carried on, yet it very seldom 
happens that they are all carried on by the capital 
of one private merchant. If a nation
therefore, is ripe for the East India trade, a 
certain portion of its capital will naturally 
divide itself among all the different branches 
of that trade. Some of its merchants will 
find it for their interest to reside in the East 
Indies, and to employ their capitals there in 
providing goods for the ships which are to be 
sent out by other merchants who reside in 
Europe. The settlements which different 
European nations have obtained in the East 
Indies, if they were taken from the exclusive 
companies to which they at present belong, 
and put under the immediate protection of 
the sovereign, would render this residence 
both safe and easy, at least to the merchants 
of the particular nations to whom those settlements 
belong. If, at any particular time
that part of the capital of any country which 
of its own accord tended and inclined, if I 
may say so, towards the East India trade
was not sufficient for carrying on all those 
different branches of it, it would be a proof 
that, at that particular time, that country was 
not ripe for that trade, and that it would do 
better to buy for some time, even at a higher 
price, from other European nations, the East 
India goods it had occasion for, than to import 
them itself directly from the East Indies
What it might lose by the high price of those 
goods, could seldom be equal to the loss which 
it would sustain by the distraction of a large 
portion of its capital from other employments 
more necessary, or more useful, or more suitable 
to its circumstances and situation, than 
a direct trade to the East Indies
Though the Europeans possess many considerable 
settlements both upon the coast of 
Africa and in the East Indies, they have not 
yet established, in either of those countries
such numerous and thriving colonies as those 
in the islands and continent of America. Africa
however, as well as several of the countries 
comprehended under the general name 
of the East Indies, is inhabited by barbarous 
nations. But those nations were by no means 
so weak and defenceless as the miserable and