108 ECONOMIC PRINCIPLES

there is no great gain in debating closely what is the line of
division between the two classes of properties fitting land
for use.
In some agricultural leases provision is made for modification
 of the condition of the land, and compensation duly
bargained for, In the case of building land it is still more
usual to provide for the making of certain improvements,
which are to pass to the owner of the land at the termination
 of the lease. In such cases, too, it is only reasonable
to suppose that the amount of rent contracted for is affected
by the presence of these features in the contract. When,
however, we consider the case of mines, we have such
compensation, for a change in the condition of the property
leased, not as an accidental, but as a necessary, feature of
the contract. A mine cannot be used without a decrease in
the store of mineral which it contains. Payment for the
use of mines, therefore, includes a compensation for the
decrease of the value of the mine necessarily resulting from
its working. The royalties which are commonly paid to
mine-owners are, then, partly a payment for material
removed, and only partly a rent proper. But they are, in
part, a true rent, for the varying facilities for the extraction
of mineral in different mines correspond to the differing
fertilities of different farms. As with farms, so too with
mines, more or less intensive working is possible, and may
enter into the rent problem in each case. Where mineral is
easily and cheaply won, and enters into market competition
with other mineral which is difficult and expensive to
extract, the former can bear a higher royalty than the latter,
and the differences in royalties are directly comparable with
differences in rents of building sites or of agricultural land.
But, so long as all the mineral is charged with royalty, the
cases are not completely parallel. The condition which
limits the profitable extraction of mineral is that its value
shall cover, not merely the cost of winning, but the royalty
in addition. Thus the marginal output has to bear a charge
not falling on the marginal produce of agricultural land.
In each case the expenses of production include the replacement
 of material and instruments used up, and replaced, or