hi the theory of value and prices. 65 



§2. 



It will be seen that this sort of dependence of particular commodi- 

 ties is very common. Articles are bought with reference to each 

 other, oil with reference to the number of lamps used, bed linen to 

 the number of beds, bureaus to the quantity of clothes to be stored, 

 carpets to the amount of floor rented or built, bookcases to the 

 number of books owned; the demand for steel rails is connected 

 with that for railroad ties, that for locomotives with that for cars, 

 etc. 



Again in production, the " peculiar cases of value " of which 

 Mill* speaks and which Jevonsf treats come under the same head; 

 coke and coal gas; mutton and wool; beef, hides, and tallow, etc. 



The cases above instanced are cases of " completing''^; articles. 

 Under the head of " competing "J; articles, come, mineral oil and 

 other oils, various ** qualities " of any article as meats, grades of 

 flour, etc., while under production almost every two articles are 

 competing. A man in one business does not wish to meddle with 

 another or, otherwise expressed, the marginal disutility of produc- 

 ing 1,000 tons per year of coal is increased if the producer attempts 

 to run a paper mill or trade in jewelry. 



§3. 



Introducing this new dependence of utilities, it is seen that, if the 

 cisterns contain at one point of equilibrium the proper amount of 

 water and have as ordinates the proj^er marginal utilities, as soon as 

 any income or commodity stopper is pressed, not only does the 

 water redistribute but the shapes of the cisterns change. If the 

 quantity of bread is increased, the cisterns for biscuit may shrink 

 and those for butter widen. That is the ordinate (marginal utility) 

 for the sayne quoMtity of biscuit decreases, and of butter increases. 

 The general effect is to keep the ratio of marginal utilities of bread 

 and biscuit and so also their prices nearlj^ constant, while the 

 cheapening of bread may directly increase the marginal utility aiad 

 price of butter irrespective of its quantity. 



§4- 

 The essential quality of substitutes or competing articles is that 

 the marginal utilities or the prices of the quantities actually pro- 

 duced and consumed tend to maintain a constont ratio. AVe may 



* Bk. Ill, Ch. XVI. t Page 197. 



X Auspitz und Lieben, p. 170. 



Trans. Conn. Acad., Vol. IZ. 5 July, 1892. 



