36 ECONOMIC PRINCIPLES

part of the market though not physically present at a point
where other traders are gathered.
The organisation of a market can easily be seen to
operate in the direction of establishing definite rates of
exchange for the goods dealt in, rates which apply to all
those trading in the market. The weak trader is supported
by the knowledge of the rates at which others are doing
business, if those others are stronger than himself, that is,
holding out for a higher valuation of the goods they offer,
a lower valuation of those which they propose to acquire.
[f the general state of the dealers is one of weakness, the
few strong dealers will have little opportunity of pushing
their advantage. Their skill in bargaining will not avail
much if competitors are so weak, that the dealers on the
other side can secure what they desire without needing to
trouble these strong holders. Thus, the mere association of
numerous dealers tends to the avoidance of extreme rates,
though these might be acceptable to some of the traders.
The example selected for discussion was selected for the
purpose of bringing into prominence only the influences on
rates of exchange which depend on the varying amounts
of the supplies of the goods entering into an exchange.
Reference to the way in which the supplies were acquired,
or might be renewed, were purposely excluded. But, in
actual practice, these conditions are also of importance,
Let us vary our illustration so as to bring out this feature.
We revert to individual exchange under primitive conditions.
Suppose a fisherman and a hunter to meet after a day’s work,
and to make an exchange of part of their produce. The
rate of exchange will be dictated by considerations of the
desire of each for the goods of the other and of the supply of
his own product which may remain to him after the exchange.
 So far, the same ideas as in the former illustration
will apply. But this encounter between fisherman and
hunter may not be casual and exceptional. It may be
repeated at more or less regular and frequent intervals. In
that case, another consideration will influence the terms of
exchange. The hunter will not regularly accept, for his
game, what he conceives to be too scanty a proportion of