a single _entrepreneur_
seldom renders it necessary to reduce the aggregate of the labor in
his employment. Far more often it makes it for his interest to
increase the number and to put new labor in every part of the plant
where no improvement in method has been made. It is often the fact,
however, that labor has to abandon other establishments in this
subgroup, and enough of it may do so to cause the amount in the
entire subgroup to become somewhat smaller by reason of an
improvement. In the case of a single employer there is a bare
possibility that no one should be moved, in consequence of an
economical invention, even from one part of the mill to another. The
manufacturer of our illustration might even keep his twelve cutters at
work after the introduction of the machines referred to and do twelve
times as much cutting, provided that he could quickly increase his
output of finished shoes to twelvefold its former amount. There are
practical reasons why he could almost never do this; but if he
actually did it, he might, by some reduction in the price of shoes,
find a market for this increased product. If the reduction of price
were great, some competitors would probably go at once out of the
business; but it is never the policy of a successful producer to make
unnecessary haste in reducing prices, and, as a rule, the reduction is
gradual. The increase of product from the very efficient mill must
cause a certain reduction in the rate at which it sells its goods, and
this is apt to force manufacturers who are particularly ill equipped
and cannot keep pace with the rate of improvement which their
enterprising competitor establishes to go out of business. They thus
relieve the market of so much of the product as they have contributed
and make a place for the increased output of the newly equipped mill.
In such a case the total output from the subgroup is not very greatly
increased, and the price of the product does not need to be greatly
reduced.

_Standard Prices fixed by Cost in the most Economical
Establishment._--It is a vitally important fact, as we shall soon
see, that the price of an article is, in a dynamic society, always
tending toward the cost of making it, not in the most inefficient
establishment, where it is produced "at the greatest disadvantage,"
but in the most efficient one of all. The ultimate effect of any great
improvement is naturally to close the shops of _all employers who do
not adopt it or get a