ly a slight one, and the consumer's case against the monopoly of
method is on the ground of his failure to receive a further benefit.
He will get that further benefit whenever a producer who can compete
on even terms with the one who now commands the field shall make his
appearance.

_Unequal Competition Typical of Carriers._--Our recent illustration
represents a similar condition in carrying. The public gets a slight
gain from the advent of a sailing vessel; but it fails to get the
further benefit that the advent of a second vessel will ultimately
bring. For a time the freight charge stands nearly at what teamsters
have charged. For cheaper rates the public must wait for the advent of
another vessel.

_The Cause of the Partial Monopoly in Carrying._--There is nothing to
prevent a second schooner from being put on this route, if the returns
to be expected should warrant it. At the outset the new vessel would
get only about a half of the amount of traffic enjoyed by the first,
and the rates would probably be reduced by the competition between the
two. Until the returns of the first vessel become large it has no
rivalry to fear, but it is clear that its monopoly is held by a very
precarious tenure. It is not likely long to enjoy the benefit of any
charges which yield much profit. The growth of traffic will in due
time bring the competing vessel, and the rule of returns that only
cover costs will again assert itself. The owner of the first sailing
craft has been able for a time to charge "the value of the service" he
has rendered, as that value was determined independently of his own
action; but now this value itself depends on his action and that of
rival carriers using the same route, and it adjusts itself at the
level of cost.

_The Effect of partly Unused Vessels for Carrying._--The case
illustrates another principle which is equally general. The
_entrepreneur_ whose capacity for producing is only partially utilized
may often take some orders at less than it costs to fill them, as cost
is usually understood, and he will still be the gainer. In
manufacturing as well as in carrying there are "fixed charges"; there
are costs which stand at a definite amount which is independent of the
volume of traffic, while other costs increase as the volume grows.
These are the "variable costs," and they have to be further
classified, since some of them do not increase as rapidly as the
business grows, while others increase with th