The Wealth of Nations: The Invisible Hand

OF RESTRAINTS UPON IMPORTATION FROM FOREIGN COUNTRIES OF SUCH GOODS AS CAN BE PRODUCED AT HOME.

By restraining, either by high duties, or by absolute prohibitions, the
importation of such goods from foreign countries as can be produced at
home, the monopoly of the home market is more or less secured to the
domestic industry employed in producing them. Thus the prohibition of
importing either live cattle or salt provisions from foreign countries,
secures to the graziers of Great Britain the monopoly of the home market
for butcher’s meat. The high duties upon the importation of corn, which,
in times of moderate plenty, amount to a prohibition, give a like
advantage to the growers of that commodity. The prohibition of the
importation of foreign woollen is equally favourable to the woollen
manufacturers. The silk manufacture, though altogether employed upon
foreign materials, has lately obtained the same advantage. The linen
manufacture has not yet obtained it, but is making great strides towards
it. Many other sorts of manufactures have, in the same manner obtained in
Great Britain, either altogether, or very nearly, a monopoly against their
countrymen. The variety of goods, of which the importation into Great
Britain is prohibited, either absolutely, or under certain circumstances,
greatly exceeds what can easily be suspected by those who are not well
acquainted with the laws of the customs.

That this monopoly of the home market frequently gives great encouragement
to that particular species of industry which enjoys it, and frequently
turns towards that employment a greater share of both the labour and stock
of the society than would otherwise have gone to it, cannot be doubted.
But whether it tends either to increase the general industry of the
society, or to give it the most advantageous direction, is not, perhaps,
altogether so evident.

The general industry of the society can never exceed what the capital of
the society can employ. As the number of workmen that can be kept in
employment by any particular person must bear a certain proportion to his
capital, so the number of those that can be continually employed by all
the members of a great society must bear a certain proportion to the whole
capital of the society, and never can exceed that proportion. No
regulation of commerce can increase the quantity of industry in any
society beyond what its capital can maintain. It can only divert a part of
it into a direction into which it might not otherwise have gone; and it is
by no means certain that this artificial direction is likely to be more
advantageous to the society, than that into which it would have gone of
its own accord.