26: Gross and Net Revenue
Ricardo begins with a quote from Smith, in which Smith suggests that a country derives advantages from having a large gross income: the greater the share of capital employed, the greater the benefit. The issue here is that Smith makes no distinction between gross and net income.
Given that the grater the quantity of product available to buyers, the lower the price they must offer for each unit, there is an optimal point in the supply curve at which net profit is maximized. Production beyond that point increases the gross income, but will result in a lesser net income - a poorer return on his capital, and lesser value to the market. As such, the interest of a producer is to produce at a level that maximizes his net income, and the interest of a nation is an aggregate of that of all producers.
He same is said of employment: if five thousand miners could produce all the coal that is needed in a nation, and that it can feasibly export to other nations, there is no benefit of employing one more man. Wealth, in either the notion of money or the notion of benefit, is not increased by a level of goods in excess of that which is wanted for the necessities and conveniences of life.
Ricardo draws some parallels between wealth and manufacturing, poverty and agriculture, as manufacturing creates greater value per worker than agriculture. (EN: likely this needs to be revisited in the modern era, to account for service sector jobs, but it does seem to be a good principle at face value.)
He returns again to the notion that nations gain or lose by trade: any exchange is a swap of items of equal value: British goods are provided to Portugal in exchange for Portuguese goods of equal value.
The trade may not be between two nations, but occupy a pattern of connections that may be triangular (Portugal sells to England, England to Germany, Germany to Portugal) or over a complex web of trade connections among many nations.
(EN: He doesn't go so far as to suggest the role of gold in all of this, but it's clearly the same as common currency in any market - substitute the names of three vendors for the three nations in the previous example: butcher, baker, weaver.)