330 THE NATURE AND CAUSES OF

other, it does not increase, the exchangeable value of the an-nual produce of the land and labour of the country.

I would not, however, by all this be understood to mean,that the one species of expense always betokens a more libe-ral or generous spirit than the other. When a man of for-tune spends his revenue chielly in hospitality, he shares thegreater part of it with his friends and companions; but whenhe employs it in purchasing such durable commodities, heoften spends the whole upon his own person, and gives no-thing to any body without an equivalent. The latter speciesof expense, therefore, especially when directed towards frivo-lous objects, the little ornaments of dress and furniture, jewels,trinkets, gewgaws, frequently indicates, not only a trifling,but a base and selfish disposition. All that I mean is, that theone sort of expense, as it always occasions some accumulationof valuable commodities, as it is more favourable to privatefrugality, and consequently, to the increase of the public capi-tal, and as it maintains productive, rather than unproductivehands, conduces more than the other to the growth of publicopulence.

CHAP. IV.

Of Stock lent at Interest.

The stock which is lent at interest is always considered as acapital by the lender. He expects that in due time it is tobe restored to him, and that in the mean time the borroweris to pay him a certain annual rent for the use of it. Theborrower may use it either as a capital or as a stock reservedfor immediate consumption. If he uses it as a capital, heemploys it in the maintenance of productive labourers, whoreproduce the value with a profit. He can, in this case,both restore the capital and pay the interest without aliena-ting or encroaching upon any other source of revenue. Ifhe uses it as a stock reserved for immediate consumption, lieacts the part of a prodigal, and dissipates in the maintenanceof the idle, what was destined for the support of the indus-trious. He can, in this case, neither restore the capital norpay the interest, without either alienating or encroachingupon some other source of revenue, such as the property orthe rent of land.

The stock which is lent at interest is, no doubt, occasion-ally employed in both these ways, but in the former muchmore frequently than in the latter. The man who borrows