Cf. also Smart, Studirt in Eeonomia, Essay Vni, on "OverproduotloD" ; also Essay IX., "The Socializing ot Consumption," putlOBUtly WC. 8, on "The Limits of Consumption," pp. 2B3-298.
of efficiency, and especially so long as incomes continue to be distributed somewhat after the present scheme, waste cannot be expected to overtake production, and can therefore not check the untoward tendency to depression. But if the balance cannot Ibe maintained by accelerating wasteful consumption, it may be maintained by curtailing and rega(lating the output of goods.
" Cutthroat " competition, that is to say, free competitive selling, can be done away by " pooling the interests " of the competitors, so soon aa all or an effective majority of the business concerns which are rivals in the market combine and place their business management under one directive head. When this is done, by whatever method, selling of goods or services at competitively varying prices is replaced by collective selling {" collective bargaining "} at prices fixed on the basis of " what the traffic will bear." That is to say, prices are
I fixed by consideration of what scale of prices will bring the largest aggregate net earnings, due re-
' gard being had to the effect of a lower price in increasing sales as well as to the reduction of cost through the increase of output. The outcome, as regards the scale of prices, may easily be a reduction of the price to consumers ; but it may also, and equally readily, be an increase of the average I price. But the prices of the output which is in this way brought to a monopoly basis are nearly