Chapter XI: Of the Rent of Land

Rent, considered as the price paid for the use of land, is naturally the
highest which the tenant can afford to pay in the actual circumstances of
the land. In adjusting the terms of the lease, the landlord endeavours to
leave him no greater share of the produce than what is sufficient to keep
up the stock from which he furnishes the seed, pays the labour, and
purchases and maintains the cattle and other instruments of husbandry,
together with the ordinary profits of farming stock in the neighbourhood.
This is evidently the smallest share with which the tenant can content
himself, without being a loser, and the landlord seldom means to leave him
any more. Whatever part of the produce, or, what is the same thing,
whatever part of its price, is over and above this share, he naturally
endeavours to reserve to himself as the rent of his land, which is
evidently the highest the tenant can afford to pay in the actual
circumstances of the land. Sometimes, indeed, the liberality, more
frequently the ignorance, of the landlord, makes him accept of somewhat
less than this portion; and sometimes, too, though more rarely, the
ignorance of the tenant makes him undertake to pay somewhat more, or to
content himself with somewhat less, than the ordinary profits of farming
stock in the neighbourhood. This portion, however, may still be considered
as the natural rent of land, or the rent at which it is naturally meant
that land should, for the most part, be let.

The rent of land, it may be thought, is frequently no more than a
reasonable profit or interest for the stock laid out by the landlord upon
its improvement. This, no doubt, may be partly the case upon some
occasions; for it can scarce ever be more than partly the case. The
landlord demands a rent even for unimproved land, and the supposed
interest or profit upon the expense of improvement is generally an
addition to this original rent. Those improvements, besides, are not
always made by the stock of the landlord, but sometimes by that of the
tenant. When the lease comes to be renewed, however, the landlord commonly
demands the same augmentation of rent as if they had been all made by his
own.

He sometimes demands rent for what is altogether incapable of human
improvements. Kelp is a species of sea-weed, which, when burnt, yields an
alkaline salt, useful for making glass, soap, and for several other
purposes. It grows in several parts of Great Britain, particularly in
Scotland, upon such rocks only as lie within the high-water mark, which
are twice every day covered with the sea, and of which the produce,
therefore, was never augmented by human industry. The landlord, however,
whose estate is bounded by a kelp shore of this kind, demands a rent for
it as much as for his corn-fields.

The sea in the neighbourhood of the islands of Shetland is more than
commonly abundant in fish, which makes a great part of the subsistence of
their inhabitants. But, in order to profit by the produce of the water,
they must have a habitation upon the neighbouring land. The rent of the
landlord is in proportion, not to what the farmer can make by the land,
but to what he can make both by the land and the water. It is partly paid
in sea-fish; and one of the very few instances in which rent makes a part
of the price of that commodity, is to be found in that country.

The rent of land, therefore, considered as the price paid for the use of
the land, is naturally a monopoly price. It is not at all proportioned to
what the landlord may have laid out upon the improvement of the land, or
to what he can afford to take, but to what the farmer can afford to give.

Such parts only of the produce of land can commonly be brought to market,
of which the ordinary price is sufficient to replace the stock which must
be employed in bringing them thither, together with its ordinary profits.
If the ordinary price is more than this, the surplus part of it will
naturally go to the rent of the land. If it is not more, though the
commodity may be brought to market, it can afford no rent to the landlord.
Whether the price is, or is not more, depends upon the demand.

There are some parts of the produce of land, for which the demand must
always be such as to afford a greater price than what is sufficient to
bring them to market; and there are others for which it either may or may
not be such as to afford this greater price. The former must always afford
a rent to the landlord. The latter sometimes may and sometimes may not,
according to different circumstances.

Rent, it is to be observed, therefore, enters into the composition of the
price of commodities in a different way from wages and profit. High or low
wages and profit are the causes of high or low price; high or low rent is
the effect of it. It is because high or low wages and profit must be paid,
in order to bring a particular commodity to market, that its price is high
or low. But it is because its price is high or low, a great deal more, or
very little more, or no more, than what is sufficient to pay those wages
and profit, that it affords a high rent, or a low rent, or no rent at all.

The particular consideration, first, of those parts of the produce of land
which always afford some rent; secondly, of those which sometimes may and
sometimes may not afford rent; and, thirdly, of the variations which, in
the different periods of improvement, naturally take place in the relative
value of those two different sorts of rude produce, when compared both
with one another and with manufactured commodities, will divide this
chapter into three parts.