r
half used, or any goods unnecessarily occupying warehouse room and
deteriorating in quality. But when competition of individual interests
comes in there is no such security.

It may pay individuals to build new factories and put in new machinery
where it would not pay the community to do so, were it the sole owner
of the means of production.

The knowledge that enough capital is already invested in an industry
to fully supply all current demands at profitable prices has no power
to deter the investment of fresh capital, provided the new investors
have reason to believe their capital can be made to displace some
existing capital owned by others. If the new-comer can, by superior
business address, by successful advertising, by "sweating" his
employees or otherwise, get hold of a portion of the business hitherto
in the hands of other firms, it will pay him to build new factories
and stock them with the requisite machinery, and to begin the process
of manufacture. There may be in existence already more bicycle works
than are sufficient to supply the consumption of the community. But
if a would-be manufacturer thinks he can withdraw from other makers a
sufficient number of customers, he will set up works, and make new
machines, though his methods of production and the goods he turns out
may be no better than those of other makers. The same holds at every
stage of production. In wholesale or retail distribution the fact that
there are sufficient warehouses and shops in existence to adequately
supply the current demand does not prevent any one from embarking new
savings in more warehouses or shops, provided he believes he is able
to divert into his own firm a sufficient amount of the business
formerly held by others. In a district two grocers' shops may be quite
sufficient to supply the needs of the neighbourhood, and to secure
adequate competition. But if a third man, by an attractive shop-front
or superior skill in the labelling or adulteration of his wares, can
procure for himself an adequate share of the custom, it will pay him
to put the requisite plant and stock into a shop, though the trade on
the one hand and the community on the other is no gainer by his
action.

There is indeed much evidence to show that it may be to the advantage
of individuals to increase the machinery of production, even though
there is no reasonable prospect of this machinery being worked at a
profit. It is the unanimous testimony of busine