This question has more commonly been discussed with reference to Smith's distinction of productive and unproductivelabour, which we shall therefore consider.
Is the distinction of productive and unproductive labour a solid distinction?
Smith says (W.N.p.145):
"There is one sort of labour which adds to the value of the subject upon which it is bestowed; there is another which has nosuch effect.The former, as it produces a value, may be called productive, the latter unproductive labour.Thus the labour ofa manufacturer adds generally to the value of the materials which he works upon, that of his own maintenance, and of hismaster's profit.The labour of a menial servant, on the contrary, adds to the value of nothing.Though the manufacturer hashis wages advanced to him by his master, he in reality costs him no expense, the value of those wages being generallyrestored, together with a profit, in the improved value of the subject upon which his labour is bestowed; but the maintenanceof a menial servant never is restored.A man grows rich by employing a multitude of manufacturers; he grows poor byemploying a multitude of menial servants.The labour of the latter, however, has its value, and deserves its reward as well asthat of the former; but the labour of the manufacturer fixes and realises itself in some particular subject or vendiblecommodity, which lasts for some time at least after that labour is past.It is, as it were, a certain quantity of labour stockedand stored up, to be employed, if necessary, upon some other occasion.That subject, or, what is the same thing, the price ofthat subject, can afterwards, if necessary, put into motion a quantity of labour equal to that which had originally produced it.
The labour of the menial servant, on the contrary, does not fix, or realise, itself into any particular subject or vendiblecommodity.His services generally perish in the very instant of their performance, and seldom leave any trace or value behindthem, for which an equal quantity of service could afterwards be procured."The distinction of productive and unproductive labour has been impugned by Mr McCulloch: but on a large scale it is wellfounded, whatever perplexities there may be in doubtful cases.The leading proposition on this subject is that which Smithasserts : "A man grows rich by employing a multitude of manufacturers: he grows poor by employing a multitude of menialservants." The former are called productive, the latter unproductive labourers: and all labourers belong to the one or theother as they can best be classed with the one or the other.
I will take Mr Malthus's account of the character and general effect of the two kinds of labour:
"Let us suppose two fertile countries with the same population and produce, in one of which it was the pride and pleasure ofthe landlords to employ their rents chiefly in maintaining menial servants and followers, and, in the other, chiefly in thepurchase of manufactures and the products of foreign commerce.It is evident that the different results would be nearly whatI described in speaking of the consequences of the definition of the economists.In the country, where the tastes and habitsof the landlords led them to prefer material conveniences and luxuries, there would, in the first place, be in all probability amuch better division of landed property; secondly, supposing the same agricultural capital, there would be a very muchgreater quantity of manufacturing and mercantile capital; and thirdly, the structure of society would be totally different.Inthe one country, there would be a large body of persons living upon the profits of capital; in the other, comparatively a verysmall one: in the one there would be a large middle class of society; in the other the society would be divided almost entirelybetween a few great landlords and their menials and dependents: in the one country good houses, good furniture, goodclothes, and good carriages would be in comparative abundance; while in the other, these conveniences would be confinedto a very few.
"Now I would ask, whether it would not be the grossest violation of all common language, and all common feelings andapprehensions, to say that the two countries were equally rich."But what are the grounds on which it is alleged that there is no essential difference between productive and unproductivelabour? They are such as these.
(Malth.Def.p.75) "Mr McCulloch has discovered that there is a resemblance between the end accomplished by the menialservant or dependent and by the manufacturer or agriculturist." He says, "the end of all human labour is the same: that is, toincrease the sum of necessaries, comforts and enjoyment, and it must be left to the judgment of every one to determine whatproportion of the comforts he will have in the shape of menial services, and what in the shape of natural products."Undoubtedly.But the question with us, as Political Economists, is not whether men shall employ one kind of labour oranother; but, what is the effect of their choice on the wealth of a country? That the same end is answered does not make ituseless to classify the means.It is not because a resemblance may be discovered among the means, that we are to identify allsuch means.
Mr Malthus well observes, to this effect:
