Though the division of employments consequent to the progress of science and art, and the operation of the accumulative principle, on the whole greatly accelerates the exhaustion of instruments, there are yet some particulars in which it tends somewhat to retard that exhaustion.In the most simple state of society, when art is so rude, and accumulation so little advanced, that each individual forms almost all the instruments he himself or his family exhaust, and when, consequently, the general stock of the community is nearly altogether a stock formed and reserved for immediate consumption, it can seldom happen that there will be either an over abundance, or a deficiency of instruments of any sort.As each individual can make an accurate estimate of his own wants and those of his t:amily, prudent men, in such a state of things, provide only the instruments that may be of use to them, and do not form any but such as they foresee will come into employment as they are formed.But when individuals ceasing to form only instruments directly supplying their own wants, give the greater part of the industry they can command to manufacturing commodities for the purpose of exchange, as they have not the means of calculating with equal accuracy the wants of other men, it occasionally happens that some commodities are produced in excess, and that there is a deficiency of others.
When again the state of society is such, that each individual forms almost the whole instruments he requires, there is very little transport of commodities from place to place.The amount of transport necessarily increases with the separation of employments.This forms another drawback from the advantages arising from the extension of the division of occupations, and system of exchange.On account therefore both of many commodities being produced in excess, and of its being necessary to transport most from place to place, there are always, in such states of society; very many commodities lying idle, being neither under process of formation or exhaustion, but collected in masses at different points, waiting till some vacancy be found for them.The longer they continue in this state the farther they must pass towards the orders of slower return, and the more the operation of the accumulative principle must be retarded.
It seems to be chiefly from the desire of obviating somewhat these two disadvantages attending the general advance of art and industry, that, when the nature of the occupation permits it, individuals engaged in all the different divisions of industry place themselves as near each other as possible, and form villages and towns.Each can thus more easily adjust the amount of commodities he produces to the wants of other men, and thus also there arises a great saving of transport.
It is also in a great measure owing to the necessity of transporting commodities from place to place, and to the difficulty of regulating the precise amount produced consequent on the division of occupations, that there arises an order of men, that of merchants, devoting themselves solely to the business of transport and exchange.Merchants are the great exchangers of society, regulating the production of commodities, and collecting and distributing them to situations where the never-ceasing processes of formation and exhaustion are producing vacancies for them.It is their business to make these exchanges with the greatest possible rapidity, and least possible expense.
There is a general average time elapsing from the period of the formation of every commodity, until it pass from the individual having formed it, to the individuals who exhaust it in the supply of their wants, or employ it in the formation of other instruments.The merchant who effects the transfer of commodities between the other members of society is entitled to receive an amount exceeding that which he gave, by the return which the labor embodied in the commodity exchanged should yield for this average time, according to the general rate of return of capital in the community.
