the demand and
high price of any other commodity will encourage its production. In this
view it will be seen, from what I have said of the effects of bounties,
that I entirely concur. I have noticed the passage Mr. Malthus's
"Observations on the Corn Laws," for the purpose of shewing in what a
different sense the term real price is used here, and in his other
pamphlet, entitled "Grounds of an Opinion, &c." In this passage Mr.
Malthus tells us, that "it is clearly an increase of real price alone
which can encourage the production of corn," and by real price he
evidently means the increase in its value relatively to all other
things, or in other words, the rise in its market above its natural
price, or the cost of its production. If by real price this is what is
meant, Mr. Malthus's opinion is undoubtedly correct; it is the rise in
the market price of corn which alone encourages its production, for it
may be laid down as a principle uniformly true, that the only
encouragement to the increased production of a commodity, is its market
value exceeding its natural or necessary value.

But this is not the meaning which Mr. Malthus, on other occasions,
attaches to the term, real price. In the Essay on Rent, Mr. Malthus
says, by "the real growing price of corn, I mean the real _quantity_ of
labour and capital, _which has been employed_ to produce the last
additions which have been made to the national produce." In another part
he states "the cause of the high comparative real price of corn to be
the greater _quantity_ of capital and labour, which must be _employed_
to produce it."[59] Suppose that in the foregoing passage we were to
substitute this definition of real price, would it not then run
thus?--"It is clearly the increase in the quantity of labour and capital
which must be employed to produce corn, which alone can encourage its
production." This would be to say, that it is clearly the rise in the
natural or necessary price of corn, which encourages its production--a
proposition which could not be maintained. It is not the price at which
corn can be produced, that has any influence on the quantity produced,
but the price at which it can be sold. It is in proportion to the degree
of the excess of its price above the cost of production, that capital is
attracted to or repelled from the land. If that excess be such as to
give to capital so employed, a greater than the general profit of stock,
capital will go to the land; if