This section is from the "The Science Of Wealth" book, by Amasa Walker.
Rent is paid for the use of land and its appendages, which together are called " real estate." The question of the rent of land is of much less practical importance in the United States than in Europe, since it is here generally held in fee simple by those who cultivate it. Yet, as an economic question,, it deserves consideration. And there is an especial inducement, since we certainly have in this country the best opportunity to investigate, in their simple primitive form, all the phenomena connected with it. Constantly entering upon new lands, we have exhibited for our observation the working-out of problems which long puzzled the philosophers of the old world.
1st, Rent implies ownership, since no one would pay for the use of that to which all had an equal title. This may be called the first condition.
2d, It implies society, so that more than one person shall desire the use of the same land or appendages. If exchange, as M. Bastiat says, "is civilization," rent is society. This is the second condition.
From our definition, it will appear that rent is paid (a) for land, (6) for whatever is added to its value or desirableness. We cannot separate the two considerations, nor would it be of practical utility if we could; as, from what we have already endeavored to show, value is not derived from the gifts of nature, but the labor of man: "land, water, steam, electricity, and the like, confer no value."
Land may be said to be the foundation of rent; and, since the rightfulness of appropriating it has been disputed, it may be proper to remark that we deem it a sufficient answer, that appropriation is indispensable to the production and accumulation of wealth, to the progress of civilization, and the welfare of the human race: therefore it is right.
Man, in his original or savage state, is a hunter. He needs no appropriation of land; for he roams at large through the forest. He accumulates little or nothing; and it is of small importance where he builds his temporary cabin. His means of living are precarious; he is often exposed to starvation, has nothing permanent, pays no rent, and population but slowly increases.
Nor in the second or nomadic condition, when man becomes a shepherd, does rent make its appearance. His business is no longer mere destruction, but preservation and use. This elevates his condition; the employment has a far more ennobling effect upon character; higher faculties and better feelings are developed. But still he lives in a tent, and removes from place to place to find pasturage for his flocks. In the natural progress of events, he becomes an agriculturist. His chief business now is to till the ground. How can he do this without preparation of the soil from which he is to draw his sustenance? And why should he do this, if another may at will dispossess him of his labors? The land must be divided, appropriated, and held by some tenure that can be relied upon; and, when this takes place, rent makes its appearance, and increases in intensity as man becomes more and more advanced in social condition; for with agriculture come the mechanic arts, manufactures, commerce, villages, towns, cities, — civilization.
We now come to the elements which enter into the rental of land.