200 ON THE CAUSES
to sell as large a quantity of his commodity as
he can dispose of at the same price as his fel-
low producers.

It is not, indeed, disputed, that the main cir-
cumstance, which determines the quantities in
which articles of this class are exchanged, is
the cost of production; but our best economists
do not exactly agree on the meaning to be at-
tached to this term ; some contending that the
quantity of labour expended on the produc-
tion of an article constitutes its cost; others,
that the capital employed upen it is entitled to
that appellation. Let us look at the state of
the facts. If a man exchanges an article which
he has produced by a day’s labour, for another
article, also the produce of a day's labour, it is
plain that the cost of production is the labour
bestowed. If another man expends £100 in
producing a quantity of cloth, that is, in the
purchase of materials as well as in the wages
of labour, and exchanges it for a quantity of
linen which has cost his neighbour £100, the
cost of production is the capital employed.