absolute demander
all persons who desire to purchase a certain commodity, whether or not they can reasonably afford it
balance of trade
the money difference between the value of exports and imports of a certain country compared with another country, measured over time
bounties
Bounties are subsidies on goods that will be exported, with the express purpose of making those goods more competitive in foreign markets, and of creating monopolies abroad. In the logic of the mercantile system, it is thought that bounties will swing the balance of trade in favor of the government that awards such bounties. Bounties are usually petitioned for by the manufacturers of a particular good.
capital
the portion of stock which is employed not for immediate consumption, but for generating revenue
circulating capital
capital which gains revenue by changing hands, e.g., goods that are purchased to be sold at a profit
commodity
a good (manufactured or not) that is sold on the market
drawbacks
Drawbacks allow a merchant to “draw back” or to recuperate whatever taxes or inland duties are levied upon his good when he manages to export them. This lets him cancel out taxes he pays at home if he manages to sell goods abroad.
effectual demander
a person who desires to purchase a certain commodity, and also can reasonably afford to purchase it. It is effectual demanders, not absolute demanders, that regulate the market price of a commodity.
faction
a special interest group which seeks to control the administration of a certain trade or to influence government to make laws to favor or disfavor certain trades
fixed capital
capital which does not gain revenue from changing hands, but rather from investing in productivity
laborer
a person who sells his labor for a wage; a person engaged in producing concrete goods
market price
the price of a commodity that reflects the relationship between the effectual demand for and supply of a particular commodity in a given market
master
an employer; the person who provides wages to laborers
mercantilism
Mercantilism is the name for the economic theory and practical system that Smith was writing against. The major tenets of mercantilism were that money constituted wealth, and that exports would always benefit a country while imports would always harm it, because money comes into the country through exportation and leaves it through importation of goods. Smith believed this view was mistaken.
natural price
the price of a commodity which reflects only the cost of the labor, land and stock employed in bringing it to market
productive labor
any labor that directly results in the production of a tangible commodity (factory work, mining work, construction work, etc.)
public debt
Public debt is incurred by the government when its expenses exceed revenue generated from taxes. Public debt is financed through private means, and usually stems from defense expenses.
public good
A public good is often a public work that benefits all of society. Public goods can be enjoyed equally by all members of society
public works
Public works are institutions or constructions (e.g., roads, lighthouses, bridges) constructed and funded by the state, and open for use by all citizens, sometimes upon the condition of paying a small fee.
rent
money paid to a landowner for the use of land, necessarily a monopoly price, or the highest price that a tenant can afford to pay
stock
stored wealth that lies in the hands of a master, or employer
unproductive labor
Unproductive labor, according to Smith, is work that does not result in a tangible product. Unproductive laborers includes lawyers, government officials, and artists. Though the work of unproductive laborers may indirectly facilitate productive labor, the salaries of unproductive laborers ultimately rely on profits generated by what is produced by productive labor.
