of all exchange-value" (Vol. I., ch. 5 of Smith), and he adds: "That such must in reality be the basis of exchange-value of all things (namely, labor time) except those which the industry of man cannot multiply at will, is a doctrinal point of the highest importance in political economy; for there is no source from which have flowed so many errors, and out of which have sprung so many diverse opinions in this science as from the vague and indefinite sense attached to the word value." (Vol. I., p. 8.)
"If it is the quantity of labor embodied in an article which regulates its exchange-value, it follows that every increase in the quantity of labor must necessarily increase the value of the object upon which it has been employed, in the same way every reduction in the amount of labor must bring about a reduction in price." (Vol I., p. 9.)
Ricardo afterwards reproaches Smith:
(1) "With having given to value a measure other than labor, sometimes the value of wheat, sometimes the quantity of labor which an article would purchase, &c." (Vol. I., pp. 9 and 10.)
(2) "With having admitted the principle without reserve, and to have, nevertheless, restricted its application to the rude and primitive state of society which preceded the accumulation of capital and the ownership of land." (Vol. I., p. 21.)
Ricardo devotes himself to demonstrating that the ownership of land, that is to say rent, cannot change the relative value of commodities, and that the accumulation of capital exercises only a passing and oscillating influence on the relative values determined by the comparative quantity of labor employed in their production. In support of this proposition he formulates his famous
