nation cannot be exhausted of its money, for
after a certain quantity has left it, the value of the remainder will
rise, and such a price of commodities will be the consequence, that they
will again be capable of being profitably exported. When money had
risen, therefore, we should no longer export it in return for goods
imported, but we should export those manufactures which had first been
raised in price, by the rise in the price of the raw produce from which
they were made, and then again lowered by the exportation of money.

But it may be objected, that when money so rose in value, it would rise
with respect to foreign as well as home commodities, and therefore that
all encouragement to import foreign goods would cease. Thus, suppose we
imported goods which cost 100_l._ abroad, and which sold for 120_l._
here, we should cease to import them, when the value of money had so
risen in England, that they would only sell for 100_l._ here: this
however could never happen. The motive which determines us to import a
commodity, is the discovery of its relative cheapness abroad: it is the
comparison of its natural price abroad, with its natural price at home.
If a country exports hats, and imports cloth, it does so because it can
obtain more cloth by making hats, and exchanging them for cloth, than if
it made the cloth itself. If the rise of raw produce occasions any
increased cost of production in making hats, it would occasion also an
increased cost in making cloth. If therefore both commodities were made
at home, they would both rise. One, however, being a commodity which we
import, would not rise, neither would it fall, when the value of money
rose; for by not falling, it would regain its natural relation to the
exported commodity. The rise of raw produce makes a hat rise from 30 to
33 shillings, or 10 per cent.: the same cause if we manufactured cloth,
would make it rise from 20_s._ to 22_s._ per yard. This rise does not
destroy the relation between cloth and hats; a hat was, and continues to
be, worth one yard and a half of cloth. But if we import cloth, its
price will continue uniformly at 20_s._ per yard, unaffected first by
the fall, and then by the rise in the value of money; whilst hats, which
had risen from 30_s._ to 33_s._, will again fall from 33_s._ to 30_s._,
at which point the relation between cloth and hats will be restored.

To simplify the consideration of this subject, I have been supposing
that a rise in