264 COTTON 



NORMAL, FLUCTUATION OF PRICES 



Eliminating the waste of ignorance which plays 

 a part in cotton production because of the presence 

 of the illiterate tenant, when the price falls below 

 the cost of production because of overproduction, 

 poor producing lands are dropped from use; those 

 engaged in cotton farming receive smaller returns 

 and less cotton is produced until consumption in- 

 creases so as to use the product as rapidly as pro- 

 duced. Were one-fifth of the present acreage 

 to be put to some other use, cotton would immediate- 

 ly advance in price : the four-fifths quantity would 

 yield in value a gross revenue perhaps equal to 

 or greater than the five-fifths at the present time 

 and at present prices, consumption remaining the 

 same all the while. On the other hand, were con- 

 sumption to decrease one-fifth and production re- 

 main the same, the price would decline until either 

 consumption should increase again or enough cot- 

 ton lands be abandoned to balance supply and 

 demand. 



PRODUCTION AND CONSUMPTION 



This adjustment between production and con- 

 sumption, as we have said, is regulated by the in- 

 evitable law of supply and demand, which at times 

 may be influenced Dy attachments with other com- 

 modities that may be or may not be substituted, 

 thus adding further complications to the situation. 



So cotton growing and cotton spinning long have 

 been working partners; although they have had 

 their quarrels, they are fairly adjusted so that sup- 

 ply and demand operate within rather narrow 

 limits, conditions being in no wise open to serious 



