MONOPOLY

99

under  competition)  and  relieved  the  pressure
which  competition  exerts  upon  individuals,
compelling  them  to  be  alert  and  act  with
energy.  Whether  competition  may  not  also
have  its  bad  side  in  driving  the  bare  survivors
to  resort  in  desperation  to  sharp  or  positively
dishonest  practices,  such  as  lying  advertising
and  thievish  adulterating,  it  is  not  for  us  to
inquire  at  present.
It  is  possible  to  lay  down  certain  probable
generalisations  which  enable  one  roughly
to  forecast  what  the  effect  of  monopoly  will
be  in  different  circumstances.  When  demand
is  highly  elastic,  a  large  restriction  of  supply
under  monopoly  is  less  likely  than  it  is  when
demand  is  inelastic,  because  a  substantial
curtailment  of  supply  is  needed  to  lever  up
price  appreciably  when  demand  is  very
elastic.  When  a  slight  limitation  of  supply
sensibly  raises  price,  it  is  practically  certain
that  a  shrinkage  of  output  and  a  considerable
percentage  elevation  in  price  would  follow
the  creation  of  a  monopoly,  other  things  being
equal.  The  phrase,  “  other  things  being
equal  ”  is  inserted  here  because  it  may  be
essential  to  the  success  of  a  monopoly  to
conciliate  the  public,  which  is  not  likely  to
prove  amiable  if  extortionate  charges  are
imposed  upon  it  Another  generalisation