That's true , he writes in a very philosophical manner and makes simple things difficult But we should improve as well

Part 2: Smith now introduces a new idea food can service benchmark for rent since most countries use most of their cultivated land for growing food the price of that food influences even the rent of land people don't grow food just because theoretically someone else could grow food there that price can vary with not only the fertility and the remoteness of the land but also with what the dominant crop is. Corn in England and most of Europe were rice in parts of China. Adam Smith now tells us how paying rent changed over the course of history. The relation of the price of butchers meat to the price of bread is very different throughout different times at the beginning of the development of the country butchers needs start out being very cheap that was because there were massive uncultivated land areas with a lot of space for cattle corn on the other hand although producing much more food per acre cannot be grown without a great deal of labour making it more expensive. As countries start to cultivate the wilderness there's not enough land left to satisfy all the demand the butchers meet with just the cattle that's running around in the wild. Hence meat prices go up if food prices go up enough a big part of that land will be used to grow food that just feeds cattle to profit from that higher meat price the farmer profits not the cattle. Now we're faced with a different situation we can't just go out in the wild anymore and get ourselves some cattle. We have to raise our cattle on land that we need to pay rent for. We will only do that though if it's at least equally or maybe more profitable to raise cattle than the grill corn. If it's not the landlord doesn't care it will still charges the rent that could be paid if we grew corn on that land. So no matter what you do with your land corn is still gonna determine to how much rent you have to pay. Corn is therefore the benchmark crop for your land which has to have these qualities: - First it feeds the most people per acre - Second its the common food of the population and - Third you can actually grow it on the land which it determines the rent for. Now why is corn such a good benchmark? Because corn is always in demand whatever you decide to do with your land. If it doesn't work you can always just turn back the corn. Corn is the benchmark not just because it's the main food source for the population but also because it's price is interdependent on the prices of different agricultural products. These products of the land compete with each other so one becoming more expensive might cause the other to become more expensive. For example if there's a lot of demand for a grass for horses the price for grass will rise which will make meat more expensive as well because the livestock is feeding on that same not more expensive grass. This might encourage farmers to not grow grass instead of corn because grass is now more profitable. The landlord usually realizes what's going on and upon seeing that his tenant has now taken up a more profitable activity checks at the rate. Which now might make you say hey but you said corn always determines the price of rent in this case it doesn't well yes not directly but growing grass instead of corn will decrease the supply of corn and thereby raise its price this goes on as long as it takes for the market to find its new equilibrium and we're back to these corn prices matching the rent of the land and thereby still serving as a benchmark for it. Smith also describes what happens to rent if there's not enough land to satisfy effectual demand. Let's go back to the law of supply demand the produce of land will always be given to those willing to pay the most so more than would would be enough for wages profits and ordinary rent the greater part of this surplus will be paid out in rent. We can see this in some regions of France where the soil supposedly influences the quality and taste of the wine. Some vineyards in these regions cannot produce enough wine to satisfy effectual demand which increases prices and thereby rent. 'Oh wine to the best wine and therefore I can charge more than ordinary rent' Alright that's it for part 1 of the produce is always a fortune event now the part 2 about the produce of land that sometimes does and sometimes doesn't afford rent what else do we need besides food? lodging, clothing. According to Smith lodging and clothing can afford rent only sometimes but wait why only sometimes? well supply and demand. In its root state land produces lodging and clothing to a much greater extent than it produces food. Just think of the wilderness it provided their ancestors with a lot of caves and other places to sleep in however they still had to spend a lot of time hunting and gathering the food they ate in fact most of their time. the furs and skins they wore was something they had an abundance as well since it came with the foods they hunted. The law of supply and demand tells us here that lodging and clothing are thereby not gonna be a profitable business and can thereby not afford rent.

Part 3: However this might change when land is cultivated. When land is cultivated it can produce much more food than before and thereby the relation between food and lodging and clothing changes. So because now there's less lodging and clothing in relation to how much food there is lodging and clothing may in fact be able to afford rent why because more food means more people and more people want more stuff. Like stuff to wear on the roof over their head still some things are always gonna be so plentiful that everybody has them but nobody needs more of them thereby they cannot afford rent. Some examples from the past are wood in large parts of North America and wool in England but if I can find someone in another part of the world who wants to buy that stuff for a good price I might be able to make a profit and pay rent again. This of course is only possible if I have the infrastructure to transport my goods in an effective way. "Countries are populous not in proportion to the number of people whom their produce can clothe or lodge but in proportion to that of those whom it can feed" - Adam Smith Book 1 Chapter 11. Food is necessary for our survival and my demand for it isn't very flexible. So I will spend as much time as it takes to acquire it. If I have to spend 99% of my time just acquiring food I will. Everything else I'm more flexible about like if I can't build myself a nice house I'll just sleep in a cave or if I can't sew myself a nice shirt I'll just wear some furs or skins. Smith then describes how improvements in farming freed us up to satisfy other needs we might have since my desire for food is limited if it only takes me 50% of my time to acquire the food I need I can spend that other 50% of my time working to satisfy some other needs or wants I might have as farming improves less and less time is needed to provide food for everyone and we are able to devote a lot more time and energy to things like rice furniture fancy cars or buying the new Justin Bieber album. "Food not only constitutes the principal part of the riches of the world but it is the abundance of food which gives the principal part of their value to many other sorts of riches" - Adam Smith Book 1 Chapter 11 Here we can see just how important they thought improving food production was to economic development. Adam Smith & remembers that he wasn't supposed to talk about food and discarded chapter and tells us how some coal mines in Scotland aren't profitable enough to afford rent. If nobody will pay rent for the mine because it's not profitable enough the only person who can run the mine is the landlord himself. He also spends a good part of the chapter describing in detail how different raw materials like wood coal silver and gold can sometimes not afford and sometimes afford rent. Luckily we can sum it up in two sentences it all depends on the cost of acquiring and transporting that thing and its market price if the costs are too high it will not afford rent. If they aren't it will. The last part part 3 of this chapter which is about the changing values of these commodities. Smith assumes that the demand for food and a population remains constant relative to the population itself that came to make sense, if I eat a lot more than 2,000 a day I'll expand a lot but the demand for other stuff can increase a lot more than just a population increases that also makes sense I can consume endless lego, that means the price of and other stuff would increase by a whole lot if a supplier wouldn't increase at the same time. Smith goes into a lot of detail here and describes three different periods in time he takes a very close look at the value of silver here which were gonna summarize for you. In the first period from 1350 to 1570 the value of silver rose and the value of Corn dropped that was because a lot of the mines in England were buried and left over from the Romans and therefore there was less near silver available also Smith thought that a relatively stable government in that period led to higher food production. Today when we talk about Smith we mostly mention him for his free market ideas which makes this passage very interesting and important. "In the end of the 15th and the beginning of the sixteenth centuries, the greater part of Europe was approaching towards a more settled form of government than it had enjoyed for several ages before. The increase of security would naturally increase industry and improvement." - Adam Smith book 1 Chapter 11. While he left markets he also didn't fail to point out how important government was for increasing the wealth of a nation. Now to the second period from 1570 to 1640 where the value of silver declined. That was because the discovery of the Americas and the subsequential mining there led to a lot more silver flowing into the European market and in the third period from 1640 to 1700 where the price of wheat and the real value of silver remained roughly constant. According to Smith why the price of wheat in this period might have not decreased is because of bad harvest or the English Civil War. Both of these events led to a decrease in harvest. After effectively describing 350 years of inflation in detail Smith goes on to describe two different categories of products. Necessary and superfluity products. Necessary products being what we need for survival and superfluity products being luxury goods. When there's a famine or we become poor we must part with all our superfluity products to acquire the necessary goods to survive. That's the price of superfluity goods Falls is that for necessary goods prices rises. The opposite is also true in economically prosperous times, the prices of necessary goods fall while the prices of superfluity goods rise. That is because in economically prosperous times people have a lot more money to spend the luxury goods. This is one of those statements of Smith that don't really reflect today's world mostly because of trade. Smith then turns around and tackles another subject the effect of economic improvement of a country on different products. For this he puts products in different categories again: - Products that can be produced in much greater quantity with industry. - Products that cannot be produced in much greater quantity with industry and - Products that can be produced in much greater quantity with industry but there is a limit For the first sort prices will rise with economic improvement but there's a limit these are products that can be produced in greater quantities with a lot of people. An example for this is cattle, in the wild nature produces a certain amount of cattle but as a country develops these cattle become more and more on demand until it becomes profitable to have herds grazing and cultivated lands. The price of what it costs to have these cattle graze on that cultivated land is the upper limit of what we can charge for your cattle. If it ever rises above that more and more land will be turned into cattle grazing land thereby increasing the supply of cattle. For the second sort prices tend to rise with economic improvement these are products that nature produces in great quantities but that people can't really produce effectively Smith gives us some examples here rare birds, wild game or fish. What he didn't know about aquaculture when society becomes more wealthy demand for these products will increase but supply won't. For the third sort of products prices tend to rise but it can vary quite a bit and it is less certain. These are products of which our ability to produce them in great quantities is limited for example, wool is limited to how many sheeps you can have which is also true for cattle in the example before but in Smith this time you could export or import your wool but not your meat which makes a huge difference. The price of your product now is no longer confined who would people at the local market would pay for it. In conclusion to this Smith throws a little shade at other writers according to him, they saw a low money price of corn in some countries as proof that those countries were poor. This was connected to the notion that an abundance of gold and silver meant that a country was rich and the lack thereof meant that a country was poor however is only proof of how much gold and silver was provided to these countries by their mines. The increase of the money price of goods in Europe in the 18th century wasn't caused by a real increase of wealth but by the discovery of more mines in the Americas although real wealth and money prices increased at the same time in Europe those two phenomena according to Smith had very different causes. One as a result of stumbling across a lot of mines and foreign continents and the other as a result of the fall of the feudal system and the establishment of stable governments that provided the industry with the only encouragement it needed security to enjoy the fruits of its labour in other words these writers confused correlation with causation. Smith now remembers that he's already more than a hundred pages into chapter 11 which was originally supposed to be about rent so he finally concludes a chapter by saying that almost any economic improvement in the country will raise rent why because prices rise and rising prices raise rent he also points out that the interests of people living off of wages people living off profits and people living off of rents are connected but not always say.

we don't currently, but considering it :) -R

@@ChapterbyChapter You should, you create content that's valuable. Ill be your first supporter!