194 
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Of the Influence of Capital 
5000 measures of corn for the support of manufacturers ; and this under the sup- 
position that the raw material cost nothing. 
Let us now suppose a capitalist to take on himself the preparation of these wares, 
and that, with concert and cooperation, the same quantity of work can be effected 
by a much smaller number of persons than before; say his outlay in feeding 
workmen is equal to 4000 measures of corn, and that he supplies the whole produce 
consumed ; liis profit on this speculation is therefore 1000 measures, if he continues 
to bring only the some quantity of goods to market as before, and to sell thearticles 
at the same price. But his desire to increase his gain will induce him to lower the 
price of his goods, and to employ more workmen ; and to sink more capital in 
production. There were only in the society, persons capable of purchasing 500 of 
these wares at their former price ; but as he increases the supply, and lowers the 
price, there will necessarily be found many more purchasers. What then will guide 
him in bringing a specific quantity, and no more or less, to market? By keeping 
the supply at 500, he gets, on each individual article sold, a higher gain; and yet 
he will be found to increase the supply, although the inevitable condition of his 
obtaining a demand for this greater supply is his lowering the price, or getting a less 
gain on each individual article sold : his increasing aggregate gain must, therefore, 
be what guides him in so doing : he must find, that a greater aggregate profit than 
1000 measuies is obtained, when he sinks more than 4000 measures in thisemploy* 
ment. If he sinks 4500 measures in production, and makes therewith 675 articles, 
and sells each at 8£ measures, his profit on the transaction, will be 10684 mea- 
sures: and this fall in the price will be evidently to his advantage; the gain, on the 
greater number of sales, being more than sufficient to cover the loss, incident on the 
sale of each article. His rate of profits, when he furnished the wrought wares through 
the means of a capital of 4000 measures, was 25 per cent; when he sinks 4509 
measures in production, his rate of profit has sunk to about 22j per cent : this 
change in the rate will not, however, any more than the fall in the price, tend to his 
impoverishment ; it will accompany his enrichment. Should he, thus encouraged, 
proceed jn increasing his productive capital, say to 5000 measures, and bring to 
^ket /50 ai tides ; and then find a sale for this number, only when the price falls 
o / measures of corn ; lie will have brought too many products to market ; and 
rea ize, on the whole of sales, an aggregate profit of only 250 measures; his rate 
o profits will then have sunk to 5 per cent. But we cannot imagine that he will 
persevere in this course ; it is impossible that he should ; this extent of supply 
cannot, therefore, become permanent, nor can this be the permanent rate of profits 
in this trade. 
After prices have settled down to the point at which they must be permanent, if 
t e capitalist should, by the introduction of better tools, or machinery, effect 
another saving m productive outlay, his rate of profits will again be increased ; *s 
wi 1 also be his profits in the aggregate ; and he will find himself again in such 
circumstances, as to be again enriched by another reduction of price, so long as the 
oss on each article sold, is more than compensated by the extension of the market 
In the above, I have supposed the existence, in one particular trade, of but one 
capitalist : I have been, therefore, studying the rules by which a monopolist would 
e guided in determining outlay, and permitting a fall of price. But in so doing- 1 
ave, at the same time, been pointing out the laws which would determine the pn c “ 
o wares, and the extent of supply, if these wares were produced by hundreds o 
mpetitors ; for whether we suppose the capital of 4500 measures to be empl°r 
y one, seeking to enrich himself; or the capital to be 450,000 of measure aC 
