no MAURICE H. ROBINSON 



in the commission bears abundant evidence, that once a cor- 

 poration has gained a position of strategic importance, due, 

 it may be, to favors from the railroads, operating over a con- 

 siderable territory, it may adopt a policy of cutting prices at 

 one point to drive out competition there while raising prices 

 temporarily at all others. If the competition at the given 

 point proves weak, this policy is almost invariably successful ; 

 even if competition is strong, it is often successful unless com- 

 petition springs up at other points. If competition springs up 

 at other points this policy almost invariably proves unsuc- 

 cessful and the consolidation in this case must make use of 

 large economies in order to maintain its existence. The his- 

 tory of the National Asphalt company, the National Cordage 

 company, and the National Wall Paper company proves con- 

 clusively that where economies of production are not for any 

 reason attained, such a policy will usually prove unsuccessful 

 in the end. The profits that come from a policy of discrimi- 

 nation may furnish the basis of a consolidation, which after- 

 wards may be maintained by establishing large economies 

 in production. 



It is also affirmed that the desire to take advantage of the 

 laws of the country, especially the protective tariff and the 

 patent system, has contributed to build up consolidations. 

 These influences are to be considered in connection with the 

 desire to attain a monopolistic position. Whatever may 

 give a monopoly will always prove an attractive force in draw- 

 ing conflicting interests together, provided that after consoli- 

 dation they are reasonably sure of attaining the fruits of such 

 monopoly. If the tariff wall or the possession of a patent 

 right will give a consolidation the exclusive control of a certain 

 line of commodities within the United States, it is evident that 

 such consolidation will be able to maintain prices above the 

 competitive level of the world. The opportunity for a monop- 

 oly will thus be present within the industry, and will always 

 hold out certain inducements to the interests which may prove 

 powerful enough to bring them together. To this fact, the 

 witnesses before the commission gave abundant evidence. 



In addition to these causes one other ought to be men- 

 tioned which is perhaps not sufficiently emphasized in the 



