SUPPLY AND VALUE 47

that producers are influenced by the ordinary commercial
motive, of undertaking only those operations the return from
which is estimated to be worth the effort and expense
necessary to secure that return, we may also assume that no
regular supply will be produced the expenses of production
of which exceed the value in exchange of the product.
The consideration of this position puts before us the expenses
of production as a measure or index of the limitation of
supply. As value was seen to result from utility combined
with limitation in supply, it is not difficult to see that,
besides finding a measure of value in the marginal utility,
we can also find one in some way related to expenses of
production. How related to those expenses is the point for
inquiry. The relation arises out of a connection between
the amount of supply and the expenses of producing that
supply, and therefore the various modes in which these
expenses vary with that amount may result in different
connections between value and expenses of production.
Consider any particular commodity, and take the total
expenses of producing a given amount of it. Conceive of
the comparison of the expenses of production of this amount
with those for an amount greater or less than itself, and take
the proportion of the difference in expenses to the difference
in product. When this difference in product is only a small
fraction of the total, we thus secure the measure of the
marginal expenses per unit.
These marginal expenses per unit may remain unchanged
when the rate of production, that is the number of units
produced in a given time, changes, or it may vary with the
rate of production. If they be unchanged, the conditions are
described by the term “constant costs.” If they fall as the
rate of production increases, and rise as it decreases, the
term “decreasing costs” is applied to the case. While if
they rise as the rate of production increases, and fall as it
diminishes, the term “increasing costs” is applied to describe
the conditions of the case. It is, for some purposes, convenient
 to conceive of the relation of effort and sacrifice,
rather than of expenses in money, to the product. The
above three cases, if we thus compared product with pro-