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depends upon the rate of profit in each country.security of a freehold mortgage, and a merchant in that country would not think of incurring the risk and trouble of investing his capital in trade, unless he could make a much larger profit than ten per cent., because he could secure this profit without risk or trouble upon a freehold mortgage; therefore, traders in that country would not continue their business unless their profits were very much more than ten per cent. But in England five per cent, can scarcely be obtained on a freehold mortgage, and a trader would be perfectly satisfied with his business if a profit of ten per cent, were realised on the capital invested in it. We shall hereafter inquire into the causes which produce these great variations in the rate of profit in different countries. In Holland a still lower rate of profit prevails than in England. Let it be assumed that in this respect England became like Holland, and that the English would be satisfied with a rate of profit so reduced that they would lend money to their government, as the Dutch have done, at the small interest of two per cent. If such a change occurred, men of business in England would be satisfied with a smaller profit than they are now, and would be ready to invest their capital in businesses which would produce them a lower rate of profit. But such a change would at once affect the margin of cultivation. Before the change occurred, no worse land is brought under tillage than that which is cultivated by B, because, although he pays only a nominal rent for his land, yet he cannot do more than realise a certain profit upon his capital, say a profit of ten per cent.; and it is assumed that with a less profit than this, men of business will not be satisfied But when the change we have supposed has taken place, a lower rate of profit will prevail throughout the country, and men will now be satisfied with a smaller profit. Hence worse land than that which was before cultivated by B, would return sufficient to give that lower rate of profit with which men are now supposed to be satisfied. The margin of cultivation would therefore descend, the land occupied by B would cease to be the worst under cultivation; and this land, instead of paying a nominal rent, would now yield a rent which might be estimated
