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1.4 Natural Agents

Manufacturing ultimately begins with the materials provided by nature - including raw materials to be transformed into finished goods, manufactured components (which the original manufacturers fashioned from natural materials at some point), and even the tools, machines, vehicles, and buildings were fashioned from materials nature provided.

The term "natural agents" may be more broadly applied to include intangible items, such as sunlight, wind, gravity, magnetism, chemical reactions, and the like. Man's own labor, and even the labor of beasts, leverages the forces of nature.

On machinery: it is an augmentation to or substitute for human labor. One man can use mortar and pestle to grin a small quantity of wheat into flour or a treadmill to be more productive. He can use a windmill to harness the power of the winds or a water wheel to harness gravity - an when the power of natural forces is brought to bear, man often increases the output beyond his physical means. (EN: The steam, gas, and electric engines further extends this in the present age.)

Smith overlooks the impact of the forces of nature in the productivity of certain communities. While his assertion that the specialization of labor enables greater productivity, the degree to which it creates additional production is a mere fraction of the increase caused by the employment of technology to harness natural forces.

Smith's error is compounded when this is applied to wealth: his assertion is that all wealth represents human labor or industry, and that a society becomes wealthy over time as the amount of labor accumulates and the benefit of past labor (in the form of durable goods from generations past) accumulates over long periods of time.

The state of economies in various nations can readily demonstrate that two communities of equal size and equal age will have great disparities in wealth if the technology employed in industry is different, regardless of the specialization of labor.

A passing mention: some natural agents remain open to free and undisputed public use, such as the wind or gravity, and have virtually limitless potential to drive economic growth. Others, however, are subject to appropriation: a field is owned by a specific individual, which prevents others from accessing it, as well as accessing the power of the current of any stream that runs through it.

The problem with appropriation is that it subjects a natural resource to limited use: a man who owns a field might be ignorant of which crop would grows best given the climate or soil; or he may be purposefully choose not to plant it or to plant less than he might; or he may be prevented by law from doing so. "It is not nature, but ignorance and bad government that limit the productive powers of industry."