12 
TRANSACTION'S OF THE TEXAS ACADEMY OF SCIENCE. 
Let us then consider the subject first from the more limited point of 
view, and inquire how these concentrated masses of capital stand re- 
lated to the production and distribution of wealth without regard to 
moral or ethical considerations. 
It is generally conceded that the industrial and manufacturing trusts 
supply the public with goods at extremely low prices, and usually in 
standard qualities, which may be relied upon, and each standard is well 
adhered to. It is also probable that under a system of freer competition 
the goods would be dearer and of much more uncertain standards. Un- 
doubtedly, too, they have lowered the cost of production to a degree 
which, in very many cases, is lower than could have been expected under 
full competition. For their practically unlimited capital enables them 
to utilize to the fullest extent every known labor-saving device, and every 
economical accessory. They also enjoy a comparative immunity from 
costs which are very burdensome to competitors hotly contesting for 
customers. It is said of many commodities that it costs more to sell them 
than to make them, and there are doubtless instances in which this is 
literally true. But to the trusts the costs of selling are minimized. There 
is another advantage which they hold to an unrivaled degree. Markets 
are always fluctuating greatly in respect to the demand for goods of all 
kinds. These fluctuations are usually greatest in those things which 
supply our higher comforts and luxuries, and those which are used in 
the expansion or increments of fixed capital. They are least in articles 
of prime necessity. When the demand greatly slackens, competitive 
producers are often compelled to go on producing at a loss in order to 
hold their markets, or subject themselves to other losses by closing their 
establishments. The trusts, on the other hand, are in no danger of 
losing their markets, and curtail their production to suit the demand 
with very little shrinkage of profits. It is this sustained character of 
profits, and, above all, their comparative immunity from losses which 
make some of these trusts so remunerative. 
A MAXIMUM RATE OF PROFIT. , 
One of the commonest of mistakes is. the idea that a manufacturing or 
mercantile establishment, not subject to the full stress of competition, 
must always be expected to charge exorbitant rates of profit on its goods. 
This is far from true. Undoubtedly, we may expect that they will en- 
deavor to secure the largest aggregate profit, but this aggregate can never 
be secured in that way. The total profit is the number of units of 
traffic multiplied by the average rate of profit on each unit. In every 
trade there is some rate of profit which will make the aggregate profit 
a maximum, or the largest possible. If an attempt be made to increase 
