LAND, in Political Economy. In eco nomic theory as in social fact, land holds a pe culiar position, by which the laws normal to other industrial objects- are deflected. Fore most is die fact that, it being an indispensable locus for all industry or even social existence, its price or rental in a community where alt the land is taken up is non-competitive, a monopoly which is also a slue qua son, as would be that of air or water, and consequently is always higher than its productive value justifies, or what is the same thing, men are content to receive a less return on their capital invested in it than in any other object. This is of course aggravated in countries where, as in England before 1832, all political privileges are annexed to it, the richest manufacturer having no vote unless he bought land and became a freeholder; less so, but still heavily, in England at present, where it and its tenantry confer great social and political prestige; but most of all in socie ties like the south of Ireland where there is practically no industry but agriculture, and a footing on the soil at some terms is the one refuge from starvation. Farms there in former days were bid for on occasion at 10 or a dozen times the gross annual produce, because there are no degrees in impossibility, and they could not in any event be deprived of a bare coarse subsistence. But •the only countries in which it is on an economic level with other objects are those like America, where there has been an inexhaustible abundance of land to be had at about the cost of surveying and registering title; and here it has been the economic regulator of other prices and wages, which cannot fall below the profit of free agriculture.
The economic discussion over land in Eng land, where freeholds are very difficult to ac quire, naturally took the form of an investiga tion of the phenomena of Rent (q.v.); and an important part of the first economic philoso phies was based on a theory of the origin and mutations of the rent charge. According to Them it could only exist where there were different grades of soils, and represented the difference in profit of farming better ones over that of farming those just sufficient to make their utilization worth while. In fact, however,
even if all soils were alike, rent would still be paid for their hire if the labor and capital could produce more than the rental. Another principle early formulated, differentiating the working of land from other industries, was that of diminishing returns: it was said that labor and capital in any other field produce in exact proportion to their volume, whatever that be, 10 times the investment producing 10 times the return,— whereas upon the land it is manifestly not so; extra labor produces but a small and rapidly dwindling accretion to the product, till it soon ceases to produce any. Here again there was imperfect observation: two plowings or hoeings would not produce double the crop of one, but double the outlay invested in manures or other fertilizers, loads of loam, etc., often produce very much more than a propor tionate extra return. The real difference is, that in other industries the extra outlay can be applied in exactly the same channels, in land it must seek different ones.
Land in this sense refers purely to land used for raising food; where it has other uses, it is subject to the general laws of industry. Land, for instance, on which is located a water-power for manufacturing, or mineral land, if for sale, follows the usual mercantile conditions.
The subject of land belongs under Land Laws; of the single tax, under Taxation; of land nationalization, under Socialism, it being a branch of the question how far it would profit the country to place the entire social machinery under elected instead of self-determined man agers; of agrarian difficulties, under the special branches of history concerned — the Roman agrarian contests, for example, shed little light on and are little illumined by the system of peasant distribution in France or the Irish land laws, with its changes from feudal to dual and finally to occupying ownership. For the methods followed in the United States, see PUBLIC LANDS.