Wood as a Fewel, According to Adam Smith

Everyone heating with wood, or thinking of heating with wood, soon or later gets around to considering the cost of doing so. Since heating with wood has been around since man discovered the benefits of fire, you might call this a problem for the ages.

It certainly was back in 1776, when our American forefathers were declaring their independence from our English cousins. Soon to experience dearly the value of wood as a source of heat in a tiny encampment called Valley Forge, George Washington and his men knew first-hand the value of firewood when one is cold.

Staying by the fire, even when Generals Washington and Lafayette rode by, was the better part of valor in the encampment at Valley Forge in the winter of 1777-78. Source: http://en.wikipedia.org/wiki/Valley_Forge
Less noticed than the beginning of the War of Independence, an elderly Scottish professor published a book in that year of 1776 that was to become, over the ages, the most well-known and respected classic in the field of economics. Adam Smith's treatise, originally published under the scholary title An Inquiry into the Nature and Causes of the Wealth of Nations, was later shortened into the now-famous The Wealth of Nations, and scholars still refer to its wisdom.

What? You've never read it? You've never lingered over one of the hundreds of delicious passages found in its 1,100+ pages? Then you may be surprised to know that professor Smith considered the cost of wood with respect to its competitor of the time, coal...and even displayed his knowledge of air quality, animal husbandry and forestry in the same passages. Enjoy.

"Coals are a less agreeable fewel than wood: they are said too to be less wholesome. The expence of coals, therefore, at the place where they are consumed, must generally be somewhat less than that of wood.
The price of wood again varies with the state of agriculture, nearly in the same manner, and exactly for the same reason, as the price of cattle. In its rude beginnings the greater part of every country is covered with wood, which is then a mere incumbrance of no value to the landlord, who would gladly give it to any body for the cutting. As agriculture advances, the woods are partly cleared by the progress of tillage, and partly go to decay in consequence of the increased number of cattle. These, though they do not increase in the same proportion as corn, which is altogether the acquisition of human industry, yet multiply under the care and protection of men; who store up in the season of plenty what may maintain them in that of scarcity, who through the whole year furnish them with a greater quantity of food than uncultivated nature provides for them, and who by destroying and extirpating their enemies, secure them in the free enjoyment of all that she provides. Numerous herds of cattle, when allowed to wander through the woods, though they do not destroy the old trees, hinder any young ones from coming up, so that in the course of a century or two the whole forest goes to ruin. The scarcity of wood then raises its price. It affords a good rent, and the landlord sometimes finds that he can scarce employ his best lands more advantageously than in growing barren timber, of which the greatness of the profit often compensates the lateness of the returns. This seems in the present times to be nearly the state of things in several parts of Great Britain, where the profit of planting is found to be equal to that of either corn or pasture. The advantage which the landlord derives from planting, can nowhere exceed, at least for any considerable time, the rent which these could afford him; and in an inland country which is highly cultivated, it will frequently not fall much short of this rent. Upon the sea-coast of a well-improved country, indeed, if coals can conveniently be had for fewel, it may sometimes be cheaper to bring barren timber for building from less cultivated foreign countries, than to raise it at home. In the new town of Edinburgh, built within these few years, there is not, perhaps, a single stick of Scotch timber.
Whatever may be the price of wood, if that of coals is such that the expence of a coal-fire is nearly equal to that of a wood one, we may be assured, that at that place, and in these circumstances, the price of coals is as high as it can be. It seems to be so in some of the inland ports of England, particularly in Oxfordshire, where it is usual, even in the fires of the common people, to mix coals and wood together, and where the difference in the expence of those two sorts of fewel cannot, therefore, be very great."
And he goes on from there to explain the reason coal and all other such commodities are limited by transportation and labor costs relative to their competitors.

I think you can see why The Wealth of Nations is such a classic. It's great reading, especially if you're a history buff...and the principles explained by Professor Smith still hold fundamentally true today. Consider these points in his passages above:

  • Coal was recognized as less "wholesome" than wood. (Although, coal's energy density is much greater than wood, making it more wholesome that the good professor probably understood, providing it can be burned cleanly. But cities of the times were shrouded with noxious clouds from the primitive coal stoves of the day, and indoor air quality was certainly one major source of  the health problems that prevailed.)
  • As a more abundant and concentrated commodity (in those places that had coal deposits), the price of coal (per unit of volume, we presume) would never exceed that of wood, since wood can be gathered and traded by individuals when coal becomes too dear. In today's context, we could say the same about all primary and alternative fuels...when they exceed the price of wood heating, people who have access to wood begin burning it. Which, by the way, is also why wood is and will always be a fuel of last resort, not of first resort...unless you're the owner of a productive woodlot.
  • Since wood is usually more expensive in more-developed countries, it will be common for wood to be imported for building purposes from less-developed countries. Back then, it was America...these days, it is New Zealand, Chile, and Canada. Like his amusing anecdote of "not a single stick of Scotch timber" in Edinburgh, it is today equally likely that there is not a single stick of Connecticut timber in New York City.
So, if you're heating with wood, consider yourself blessed. You're burning the most precious fuel in the world, in terms of fundamental economics. And you get to enjoy that crackle.

And if you're not...well, enjoy this for a while. I swear, I can feel the heat coming off the screen.

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