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and supply, as such, was the sole governing power of the 

 movement of price, notwithstanding that behind demand 

 and supply was cost of production that regulate supply. 

 As the fire can only influence the piston-rod through the 

 steam, so cost of production can only influence price through 

 supply. Only there is this difference, that whereas fire only 

 can create steam, other things besides cost of production 

 determined supply. So that it is demand and supply, as 

 such, only that determine price. To show this, take first 

 reduced cost of production without increase of supply. 

 Suppose I own the Blue John Mine, the only mine in the 

 world that yields Derbyshire spar, and that I discover a way 

 of reducing the cost of the work by half, but do not increase 

 my output, only lessen my expenses, then demand and supply 

 being unaffected the price remains unaltered, notwithstanding 

 the reduced cost of production. Or suppose I discover a 

 process by which I can make silk from mulberry leaves 

 direct and keep my process secret without increasing my 

 output, the same result happens. Now take increased supply 

 without reduction of cost. Suppose a diamond field, where 

 the difficulties of finding the diamonds are so great that only 

 a limited number of people take to the business, and the price 

 of diamonds stands at so much ; and strppose now another 

 diamond field, just like it, is discovered elsewhere with just 

 the same difficulties and the same profits ; then about the same 

 number of people start diamond hunting there, so the supply 

 of diamonds being doubled the price falls, notwithstanding 

 that cost of production is exactly what it was. A law like 

 this of demand and supply covers all cases, disturbances 

 included, is at least as important as forming, one may 

 say, one that, like cost of production, can only be 

 applied after all disturbing influences have been excluded. 

 Economics, to be worth studying, must be more than an intel- 

 lectual exercise for the few, it must afford a useful guide for 

 the many ; and just as the sailor wants to know not how the 

 winds would \Ao~w if things were different and there were no 

 land (though that is good and useful, too, in its way), but 

 how and why they do blow so variably, so uncertainly, so 

 bewilderingly, so what the man of the world wants to know is 

 not what prices would be if things were different and there 

 were no disturbing influences, but what does actually deter- 

 mine them under all the innumerable and ever-present influ- 

 ences of natural scarcity, artificial monopoly, privileged obstruc- 

 tion, protective duties, rings, and syndicates, sudden changes 

 of fashion, slow changes of custom, disappearance of species, 

 and a thousand other interfering agencies, all which are 

 not confined to a one per cent, class of articles, but enter 

 more or less at one stage or another into every single article 

 of commerce. And the simple law of demand and supply 



