begin and end on the same level in this respect. At the same time the progressively wider and more close-knit articulation of the several industries in a comprehensive process is also going forward, and this also affects all branches of industrial business in some degree and in the same direction, as will appear presently. The items of the equipment (plant, materials, and in a measure even good-will) in which any industrial enterprise invests, and by the use of which the business men in industry turn out their output of vendible goods, are themselves products
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of the machine industry. Machine processes, ever increasing in efficiency, turn out the mechanical appliancea and materials with which the processes are carried on, at an ever decreasing cost ; so that at each successive step the result is a process having a higher efficiency at a lower cost.' This is now no longer a sporadic efEect of ingenious contrivances having a local and limited application, to be handled as trade secrets and exploited as an enduring differential advantage.
The cost of production of " capital goods " is steadily and progressively lowered, as counted in terms of the processes involved in their production. In a competitive market this is reflected, with greater or less promptitude, in the prices of such capital goods to all buyers. But the buyers whose purposes this lower scale of prices particularly subserves are chiefly the new investors who go into business in the way of new industrial establishments or extensions of the old. Each new venture or extension goes into the competitive traffic of producing and selling any line of staple goods with a differential advantage, as against those that have gone before it, in the way of a lower scale of costs. A successively smaller aggregate value of new equipment will turn out a given volume of