Interest Term Analysis

...of these three categories: wages from labor, rent from land, and profit from stock (including interest, the profit from lending one’s stock to someone else). Often, different people depend on these... (full context)

...profits because it forces merchants to compete. Exact profit rates are difficult to measure, but interest rates can be used as a proxy for them. The rates set by the British... (full context)

...and lower profit rates. The same dynamic applies to Scotland and England: although the legal interest rate is the same in both, the market interest rate is significantly higher in Scotland,... (full context)

But Britain’s American colonies don’t fit this pattern. Wages are highest there, but so are interest rates and profit margins. This is because the colonies are still underpopulated, relative to their... (full context)

...of the economy. Competition decreases, prices rise, profits increase, and so owners can afford higher interest rates. This happened across Britain’s colonies, like in Bengal, where interest rates often exceeded 50... (full context)

...growth by sharply limiting foreign trade and letting the wealthiest business owners suppress their competition. Interest rates there are still as high as 12 percent. (full context)

Often, merchants raise interest rates because their country’s legal system does not effectively enforce contracts and they need to... (full context)

...subsistence-level wages go to profit. In Smith’s Britain, ordinary market profit rates are about double interest rates, but can vary within reason. This is why countries with high wages can compete... (full context)

...create banknotes by discounting, or issuing people credit in exchange for a later repayment with interest. But Scottish banks created a different system: they offer cash accounts for anyone who can... (full context)

...and forth to cover their debts to banks. In the process, they incurred very high interest rates, risked bankruptcy, and increased the supply of paper money past its natural limit. When... (full context)

Lenders treat the stock they lend with interest as capital. Borrowers generally use it as capital, but they sometimes use it to cover... (full context)

Some have attributed these falling interest rates to the European discovery of the Americas, but this makes little sense, as the... (full context)

Some countries outlaw lending money for interest, but this has the opposite effect, creating a black market with even higher interest rates.... (full context)

Lastly, land prices depend on interest rates because people with excess capital who don’t want to manage it themselves have two... (full context)

...profits, the exclusive trade also reduces wages, discourages land improvement, reduces land rents, and raises interest rates in Europe. In short, it benefits merchants but harms everyone else in society. Further,... (full context)

Sovereigns can also earn interest by lending money and treasure. The Swiss canton of Berne lends money to other states,... (full context)

...taxes cannot cover the sovereign’s expenses. Britain’s land tax applies to all land, houses, and interest earned on capital stock, but it still doesn’t cover the state’s revenue. As private people... (full context)

...parts. Building rent pays for the cost of the construction, plus the ordinary rate of interest (so that the builder can make a profit). Ground rent pays for the cost of... (full context)

...Profit, or upon the Revenue arising from Stock.” Profit has two parts. One part is interest, which pays back the stockowner’s investment at an ordinary profit rate. The other part is... (full context)

Taxing interest may seem advantageous, because interest is like ground rent: it is a market price which... (full context)

...declare their net worth. These small annual taxes are all meant to be taxes on interest. Holland once assessed a one-time 2% tax on net worth after establishing a new government—which... (full context)

...affect middle-ranking people who keep servants. All these taxes on particular businesses do not affect interest rates, since merchants in these businesses still buy credit in the same market with people... (full context)

...malt taxes at the beginning of every year, and the crown pays it back with interest as it collects the taxes. (full context)

...crown issued and repeatedly extended a series of temporary taxes in order to cover its interest payments between 1697 and 1710. The taxes became perpetual in 1711, then were consolidated into... (full context)

The crown also offers fixed-term and lifetime annuities, meaning it pays creditors their interest every year either for a certain number of years or until the creditor dies. Its... (full context)