206 ECONOMIC PRINCIPLES

outlet of a magnitude corresponding in extent to the freed
producing powers.
The existence of import duties is thus seen to be a cause
of the application of the producing energies of the community
at points to which they would not have been directed in the
absence of the duties. It is, generally speaking, the purpose
of the duties to lead to such a diversion. We shall return
later to the question of how far such a course is conducive
to the economic development and advantage of a community.

We have considered the case of import of goods which
are not produced in the importing country, in exchange for
an export of goods not produced in the country to which
they are sent. We have also considered the case where one
importing country gets goods such as it does not produce
itself, in exchange for goods which are similar to some of the
products of the country to which they are sent. We proceed
 to the third case, that, namely, in which both countries
produce goods similar to those which they import, as
‘lustrated by the exchange of English woollen goods for
Canadian wheat or dairy products. This case has, in fact,
practically been dealt with in the preceding. The valuation
of the woollens imported into Canada, and the effects of the
importation on the domestic manufacture, are parallel with
what has been already stated of the cotton goods imported
nto the United States. The same holds of the wheat
imported into England. In this case it is more obvious,
than in the case of manufactured goods, that the importation
of the foreign product results in the abandonment of the less
remunerative part of the home industry engaged in raising
the same product. The experience of half a century,
especially of the latter half of that time, has shown that
iand, formerly used for growing wheat in England, has
ceased to be used for that purpose. The redistribution of
the productive agents, thus rendered necessary, presents
features of peculiar difficulty in this case. The labour and
capital can be transferred to other lines of production with
more or less of difficulty, but the transfer of the land to other
ases is not so simple. The other uses to which transfer was