46. Variations in the value of gold and silver, compared with the other objects of commerce, and with each other.

All metals are capable of being employed as money. But those which are too common have too little value in a large bulk to be employed in the current uses of commerce. Copper, silver, and gold, are the only ones which have been brought into constant use. And even copper, except among people to whom neither mines nor commerce have supplied a sufficient quantity of gold or silver, has never been used but in exchanges of small value.

It is not possible, but the eagerness with which every one has sought to exchange their superfluous commodities for gold and silver, rather than for any other commodity, must have augmented the value of these two materials in commerce. These are only thereby rendered more commodious for their employment as tokens, or common measure.

This value is susceptible of change, and in truth is continually changing; so that the same quantity of metal which answered to a certain quantity of such or such a commodity, becomes no longer equal thereto, and it requires a greater or less quantity of silver to represent the same commodity. When it requires more, it is said the commodity is dearer. when it requires less, that it is become cheaper; but they may as well say, that the silver is in the first case become cheaper, and in the latter dearer. Silver and gold not only vary in price, compared with all other commodities, but they vary also with each other, in proportion as they are more or less abundant. It is notorious, that we now give in Europe from fourteen to fifteen ounces of silver for one ounce of gold; and that in former times we gave only ten or eleven ounces.

Again, that at present in China, they do not give more than twelve ounces of silver for one ounce of gold, so that there is a very great advantage in carrying silver to China, to exchange for gold, to bring back to Europe. It is visible, that, in process of time, this commerce will make gold more common in Europe, and less common in China, and that the value of these two materials must finally come in both places to the same proportion.

A thousand different causes concur, to fix and to change incessantly the comparative value of commodities, either with respect to each other, or with respect to silver. The same causes conspire to fix and vary the comparative value, whether in respect to the value of each commodity in particular, or with respect to the totality of the other values which are actually in commerce. It is not possible to investigate these different causes, or to unfold their effects, without entering into very extensive and very difficult details, which I shall decline in this discussion.