in the theory of value and prices.

65

It will be -seen that, this sort of dependence of particular commodi-ties is very common. Articles are bought with reference to eachother, oil with reference to the number of lamps used, bed linen tothe number of beds, bureaus to the quantity of clothes to be stored,carpets to the amount of floor rented or built, bookcases to thenumber of books owned; the demand for steel rails is connectedwith that for railroad ties, that for locomotives with that for cars,etc.

Again in production, the “ peculiar cases of value ” of whichMill* 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”! articles, come, mineral oil andother oils, various “ qualities ” of any article as meats, grades offlour, etc., while under production almost every two articles arecompeting. A man in one business does not wish to meddle withanother or, otherwise expressed, the marginal disutility of produc-ing 1,000 tons per year of coal is increased if the producer attemptsto run a paper mill or trade in jewelry.

Introducing this new dependence of utilities, it is seen that, if thecisterns contain at one point of equilibrium the proper amount ofwater and have as ordinates the proper marginal utilities, as soon asany income or commodity stopper is pressed, not only does thewater redistribute but the shapes of the cisterns change. If thequantity of bread is increased, the cisterns for biscuit may shrinkand those for. butter widen. That is the ordinate (marginal utility)for the same quantity of biscuit decreases, and of butter increases.The general effect is to keep the ratio of marginal utilities of hreadand biscuit and so also their prices nearly constant, while thecheapening of bread may directly increase the marginal utility andprice of butter irrespective of its quantity

The essential quality of substitutes or competing - articles is thatthe marginal utilities or the prices of the quantities actually pro-duced and consumed tend to maintain a constant ratio. We may

* Bk. Ill, Oh. XVI.t Auspitz und Lieben, p. 170.Trans. Conn. Acad., Vol. Vftl. IX

f Page 197.

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July, 1892.