PRINCIPLES OF VALUE AND PRICE 457 



With reference to comforts and luxuries the matter is very differ- 

 ent. If the price declines or if the purchasing power increases, those 

 who were not able to buy and use comforts before will now come for- 

 ward as purchasers, while those who want to enjoy their use more 

 generously will purchase in larger amounts. Demand is thus expanded 

 or narrowed as the case may be, and the market more or less supported 

 as the case may be. Much more in the case of luxuries, desire, given 

 proper variety, expands almost without limit as purchasing power 

 increases or as prices decline. Under these circumstances the market 

 for this class of goods has wide support. In case of higher prices or 

 of lessened purchasing power, however, the demand shrinks through- 

 out a wide circle. Rise in price is thus checked. In case of extreme 

 or abnormal decline in purchasing power in periods of pronounced 

 depression prices may fall decidedly with this price of goods. 



II 



The theorist in the economics of agriculture may well consider 

 the importance of the distinctions thus pointed out by the general 

 theorist in economics. It may be said in the first place that agricul- 

 ture is, generally speaking, an industry which has to do with the 

 production of the more absolute necessities of life, while the non- 

 agricultural industries have to do, in the main, with the production of 

 comforts and luxuries. If this be true and in spite of important 

 exceptions it is believed to be substantially true the demand for 

 agricultural products is, generally speaking, inelastic in character and 

 that for non-agricultural products elastic in character. 



With reference to food supplies as a whole, it is very evident that 

 demand is relatively inelastic. Food up to a certain rather rigid 

 limit is wanted imperiously and then any further supply for present 

 consumption would be even objectionable. Storage of food supplies 

 results in a better seasonal distribution in the consumption of food- 

 stuffs and not of larger consumption of food in general. 



With reference to any particular article of food in the consumption 

 of which there is no fixed custom or habit there may be a considerable 

 measure of elasticity of demand because of the possibility of the sub- 

 stitution of one article of food for another. Likewise in a country 

 where food has been regularly cheap and plentiful wasteful habits with 

 reference to its use may be reformed in periods of scarcity and high 

 prices, thus appreciably lessening the total demand for food without 



