6: Profits
The producer of a good invests his capital in productive activity to receive a profit on the use of his capital. That is to say that a farmer who raises a crop seeks to sell the crop at a price that will return to him the cost of his laborers, the rent of the land, the cost of seed, the cost of equipment, and a margin of profit. The same is true of the manufacturer, merchant, transporter, and anyone involved in an activity that is involved in the production, transport, or sale of goods.
The producer of a good also bears a measure of risk for which he will seek compensation. That is, the price he pays his laborer and his suppliers is based on the assumption that he will sell the finished good at a given price, and thus recover their expense. Especially when the time between this estimation and actual sale is long, there is the greater risk - e.g., a farmer must commit to expenses and it will be some months before he realizes whether his expectation of the price he can get for his crop was accurate. Where his estimate was inaccurate, he either reaps an additional profit if it is in his favor, or sacrifices profit (even to the point of consuming his personal wealth) if it is against.
There's more extended consideration of risk in relation to cost and price, but this too can be shortcut with a simple concept: that a person who buys a good does not care at all for the expenses of the producer, but merely takes the most advantageous price available to obtain the good he needs. If one producer must price his product 10% higher to cover unusual expenses, he will find no buyers until the products of other producers who had no such unusual expenses have sold.
There is also some consideration that the cost of component materials is married to the cost of labor to produce them: whether the tailor pays more for cloth, in is because the weaver paid more to weave it of thread, the spinner more to make thread of cotton, the farmer more to pay his farm-hands.
However, Ricardo also asserts that commodities rise because more labor is required to create them, not because the labor used is a higher value. Again, recall the distinction between "value" and price, in that the laborer may have a higher money-wage, and the price of a product may increase, but the laborer's own value remains the same (his higher wage being spent on more expensive products, his welfare is not improved).
Profit to the capitalist is much the same as change in wages to the laborer - it is balanced against the market price of goods. A temporary windfall is gained where the capitalist raises his prices before others, and a temporary loss is suffered if others raise before him.
There is also some repetition of the attractive power of profitability: in a situation where higher profit attracts producers and lower profit encourages them to invest elsewhere, with corresponding effects on supply and demand and market price. Those makers who have able to react more nimbly to changes in supply will enjoy the greatest profit and suffer the least loss.
The natural tendency of profits is to decrease in the progress of society and wealth. While the efficiency of production increases, as does the demand for goods with increasing population, so does competition among producers serve to encourage the price of goods and the profits to be made to a level closer to their actual value.
(EN: Another factor occurs to me: experience and/or expertise. This should influence price to decrease in that a manufacturer can predict with greater accuracy the level of output and charge less of a margin for risk, and the increase in the experience of the workforce means that there are more workers with sufficient skill, decreasing the premium paid for labor. And expertise, aside of technological innovation, makes the productive act itself more efficient.)
There is an oblique reference to accumulation, by which I take the author to mean the hoarding of goods or wealth because of the belief they will have greater value in future than can be had in present. He suggests that the motive for accumulation diminishes as profit itself diminishes, as the perception is that it can generate less profit if stored for future use than it could by being placed into productive use at present.
(EN: This is difficult to concretize in the modern economy, where wealth that is "horded" in bank accounts is actually being put to productive use by means of supplying it as credit to others. Even attempting to consider wealth as stored commodities such as precious metals, the notion does not fit: their prices wax and wane over time and the tendency to horde them or sell them is also cyclical. Even comparing the price of one commodity to another, comparing gold to wheat or oranges over a span of the past fifty years, I am unable to recognize a consistent pattern.)
Ricardo reaches a number of conclusions: there is a natural interplay between the factors of production: the profits on capital, the rent of land, and the wages of labor. An attempt to adjust or control one will have temporary effects on the others, but they will adjust back to their original relationship over longer periods of time.
In terms of profit, any attempt to increase profit will increase the cost of labor and the rent of land, and any attempt to decrease profit will have the inverse effect. And even those able to amass capital during the periods of adjustment will be compelled by their desire to make advantageous use of it to reinvest in production at some point, which mitigates the discrepancies and encourages the relationship to return to normative levels.