TRANSACTIONS OF SECTION F. 607 
The common form (described by theorists as ‘ abnormal’) arises out of the 
inability of the private firm to foresee and control the market. The desire to 
make a living and readiness to fight for the chance to do so generate competition 
as a natural outlet of human activity. Hence naturally (or normally) proceeds 
excessive competition. Desire to control or suppress competition is the funda- 
mental principle of all combinations, and therefore the common form is really 
‘normal,’ This is important, since our view of what is ‘normal’ in the com- 
bination movement may colour our view of the future of that movement. 
Tariffs exercise a direct influence in the direction of combination in Pro- 
tectionist countries. The view that indirectly they promote the same tendency 
in other countries seems contradicted by the spread of combination in trades not 
affected by Protection. General free trade, even if it dissolved some unions, 
would by increasing competition produce internationally the same state out of 
which have arisen domestic combinations. 
Over-capitalisation attends the origin of combination, but only because over- 
capitalisation is an essential condition of over-competition. Hither by competition 
or by combination over-capitalisation must be eliminated, and combination does 
it in the most peaceful and gradual manner. This refers only to moderate over- 
capitalisation, and not to criminal or foolish valuations. 
There is nothing in economics hostile to the view that the large amalgamation 
will be the dominant industrial form of the future; but this will depend on the 
wan of business, and not on the man of theory. 
5. The Development of Trusts. By D. H. Macerecor, M.A. 
Many of the causes of Trusts are historical, and due to the progress of invention 
in machinery and transport. These must, in any case, have created a larger manu- 
facturing unit. 
Accidental causes have also operated, such as tariffs, forms of taxation, the 
influence of strong personalities, and of national sentiment. When these have 
given the ‘momentum of the start,’ Trusts maintain themselves by various forms 
of what is best called ‘economic advantage.’ This advantage has been allied to 
forms of competition which were not allowed for in orthodox economic theory. 
It seems certain that we must reckon with Trusts in some form for the future. 
The difficult problem is between their ultimate nationalisation and their legislative 
control. The latter has not had a distinguished history, The former is beset with 
all the difficulties of socialism, 
