ECON 319 Lecture Notes - Lecture 3: W. M. Keck Observatory
Document Summary
The word rent is not used in modern terms, it"s defined as the payment for the. Original and indestructible powers of the soil that is to say who owned the land in the beginning has certain control over it. It is also the beginning of the cycle of economics where the landlord owns the land, pays the farmer to farm it, the farmer then hires help to till the soil and pay the wages. All the while there is interest in increasing profit and keeping the labour costs as low as possible. Higher rent is because the farm has more to offer because more capital was invested into it and it will reap a higher profit. When a country is first settled, no rent is paid. Ricardo makes two assumptions: there can not be different prices for the same good (the law of one price), there is (a tendency to) a uniform rate of profit.
