ABSTRACT
Trade originated in McCulloch's view, as in Smith's,2 in a 'vent for surplus'. However, it quickly developed from this uncertain beginning to a point where it rested on the regular basis of absolute advantage. The benefits to which he saw it giving rise followed fairly closely on the lines laid down by his 'great economical chief' as McCulloch called Adam Smith.3 Trade brought a country commodities which were completely unobtainable from its own resources4 and commodities which it was unable to produce so cheaply.5 Trade also increased welfare by moving commodities to where their utility was greatest: the proper business of merchants 'consists in carrying the various products of the world from those places where their exchangeable value is least to those where it is greatest; or, which is the same thing, in distributing them according to the effective demand',6 The size of such a gain was partially indicated by the excess of imports over exports,7 an excess which was expressed generally as the difference between the cost of the goods in the foreign market and their final selling price when imported
1 Scotsman, M a y 17, 1817, p. 135; ibid., December 5, 1818, p. 385, 'Policy of Restrictions on the Corn Trade' ; ibid., April 17, 1819, p. 121, ' O n the Importation of Foreign Corn'; Edinburgh Review, Vol . X X X I I I (1820), loc. cit., p. 183; ibid., Vol. X L I (October 1824), pp. 55-78, 'Price of Foreign Corn - Abolition of the Corn Laws', pp. 67-8; Statements, p. 4.
