I’ve been rather hastily reading Chapters IV and V of Wealth of Nations, “Of the Origin and Use of Money” and “Of the Real and Nominal Price of Commodities, or of Their Price in Labour, and Their Price in Money.” It’s been difficult to find anything I thought applied to this blog, but I finally settled on a string of quotes from Chapter V.

But though labour be the real measure of the exchangeable value of all commodities, it is not that by which their value is commonly estimated. It is often difficult to ascertain the proportion between two different quantities of labour… The different degrees of hardship endured, and of ingenuity exercised, must likewise be taken into account… But it is not easy to find any accurate measure either of hardship or ingenuity… (34)

Every commodity besides, is more frequently exchanged for, and thereby compared with, other commodities than with labour… (35)

But when barter ceases, and money has become the common instrument of commerce, every particular commodity is more frequently exchanged for money than for any other commodity… (35)

Equal quantities of labour, at all times and places, may be said to be of equal value to the labourer… (36)

But though equal quantities of labour are always of equal value to the labourer, yet to the person who employs him they appear sometimes to be of greater and sometimes of smaller value… (37)

Equal quantities of labour will at distant times be purchased more nearly with equal quantities of corn, the subsistence of the labourer, than with equal quantities of gold and silver, or perhaps of any other commodity… (39)

Labour, therefore, it appears evidently, is the only universal, as well as the only accurate measure of value, or the only standard by which we can compare the values of different commodities at all times and all places. (41)

After a discussion of how coinage became debased over the years (a pound sterling did once weigh a pound of a certain grade of silver), Adam Smith starts defining the word “value.”

The word VALUE, it is to be observed, has two different meanings, and sometimes expresses the utility of some particular object, and sometimes the power of purchasing other goods which the possession of that object conveys. The one may be called “value in use;” the other, “value in exchange.” The things which have the greatest value in use have frequently little or no value in exchange; and on the contrary, those which have the greatest value in exchange have frequently little or no value in use. Nothing is more useful than water: but it will purchase scarce any thing; scarce anything can be had in exchange for it. A diamond, on the contrary, has scarce any value in use; but a very great quantity of other goods may frequently be had in exchange for it.

“Of the Origin and Use of Money,” Chapter IV of Wealth of Nations, pp. 31-32

How does this quote from Adam Smith shed light on making restoration into a mainstream economic activity, instead of something that is paid for by governments? I think making that move would require elevating the value of use above the value of exchange.

The nature of agriculture, indeed, does not admit of so many subdivisions of labour, nor of so complete a separate of one business from another, as manufactures. It is impossible to separate so entirely, the business of the grazier from that of the corn-farmer, as the trade of the carpenter is commonly separated from that of the smith. The spinner is almost always a distinct person from the weaver; [clearly Smith never went to Navajo lands] but the ploughman, the harrower, the sower of the seed, and the reaper of the corn, are often the same. The occasions for those different sorts of labour returning with the different seasons of the year, it is impossible that one man should be constantly employed in any one of them.

My favorite word from this…the harrower.

I don’t know if I agree entirely with Smith’s point here, but in any case, one of the most exciting movements in agriculture these days is a move away from specialization and toward organic farming of a variety of crops on small plots of land.

In every other art and manufacture, the effects of the division of labour are similar to what they in this very trifling one [the manufacture of pins]; though, in many of them, the labour can neither be so much subdivided, nor reduced to so great a simplicity of operation.

Another brief post courtesy of Adam Smith.

Do you suppose a division of labor in restoration would make it more amenable to entrepreneurship?