' The typical form taken by thin acceleration U tlie machine production of machiner;. but !□ fsct it involvea the production of other material lacton aa well u the meohanlcal ftppftratoa, notabl]' th« materialfl used Id industr;.
vendible product. In so far as there is no coUu' sive control of the output or the prices, this means that the newcomers will cut under the scale of prices at which their predecessors have been content to supply the goods. The run of competitive prices is lowered ; which means that at the new competitive prices, and with their output remaining on its old footing as regards expenses of production, the older establishments and processes will no longer yield returns commensurate with the old accepted capitalization.' From the inherent character of the machine industry itself, therefore, it follows that the eaming-capacity of any industrial enterprise enters on a decline from the outset, 'and that its capitalization, based on its initial I putative earning-capacity, grows progressively antiquated from the start. The efficiency of the machine process in the "instrumental industries" sets up a discrepancy between cost and capitalization. So that a progressive readjustment of capitalization to correspond with the lowered eaming-capacity is required by the nature of the case It is also, in the nature of the case, impracticable,
< The eaUbllBhed concema having been capitallced on the buia ol put cost, we can e&j that in the older eatablUhinenta, cap =/ (coat), but in the new eHtablishments with an equal eaming-capacity, oapi =
f (coat) = coat — A cost); hencs the rate of eaminfp =
irill be progmsiTely higher as coat decreueB : —