But when there is this demand--this willingness to pay
money for any article--people begin at once to supply it, because the
money they receive allows them to take goods which they wish from the
common stock. Evidently, if there is an unlimited supply of any thing,
people will not pay money for it. People will not pay money for fresh
air to breathe when they are out-of-doors, and the supply is unlimited;
but when indoors, the supply may be limited, and they will spend money
to have ventilators and air-pipes built to supply them with fresh air.
Or take the contrary case: The supply of some commodity, say flour,
falls very short. Evidently less flour must be used by the world than
was used in the years of a more plentiful wheat harvest. But no one will
wish to be the one to go without, and most people will pay a little more
rather than do so. Therefore the price rises.

The competition which we have chiefly considered is the rivalry which
exists between the men who supply the same sort of goods; but there is a
rivalry among buyers as well. Speaking generally, every buyer is trying
to purchase for as little as possible, and every seller is trying to
dispose of his goods or services to the world for as much as possible,
which each has a perfect right to do.

We have already seen that prices vary with the relative proportion
between supply and demand, rising as demand rises or supply fails, and
falling as supply increases or demand falls off. But to complete the
wonderful perfection of the mechanism, the reciprocal relation is
introduced, so that supply and demand vary with price. If the price
rises, fewer people can afford to buy and more will be anxious to sell;
while if the price falls, more people will wish to buy and fewer people
will be willing to sell.

We can now easily see why some men are able to take out from the world's
common stock of product so large an amount, while most men can take but
a meagre allowance. By the law of supply and demand the price is far
higher for the service which one man renders to the world than another.
Let us take the operation of a large machine shop, for instance. Only
one superintendent is needed, and he should be a man who has devoted
much time to mastering all the details of the business, and is
experienced and competent to so govern the work that a large product
will be turned out at a small expense. There is a demand in the country,
let us say, for 5,000 such men; but out of t