56 ECONOMIC PRINCIPLES

of managers, so that a limit to the utilisation of all other
sources of economy may be found in the limits to human
powers of effective control. Thus, again, are suggested
possibilities of continued competition, in spite of the existence
of conditions of decreasing cost, and these possibilities arise
out of limitations to the applicability of those conditions, in
practice, without limit.
The relation of cost of production to value is not so
simple in conception, when we assume conditions of increasing
returns, as in the cases of constant or of decreasing returns.
The division of the market among the different members of
the body of producers is determined by conditions less
simple to conceive, even if not less simple in reality, in the
former than in the latter case. Conceiving, however, of the
balance of supply and demand in the following fashion,
without reference to the question of how this division is
effected and a continuance of competition ensured, the outlines
 of the problem do not differ greatly from those laid
down in the other cases. By the nature of the variation of
marginal utility with supply, the marginal utility decreases
as the supply increases. Under the assumed conditions, the
price per unit which is adequate to evoke a given supply also
decreases as that supply increases. If the supply price be
always greater than the demand price for the same amount
of supply, there can be no supply offered on a commercial
basis, since all supply would involve loss. Hence, if the
possibility of supply at a profit be assumed, the supply-price
must fall as low as the demand-price for some scale of supply.
Putting aside as improbable the identity of demand-price
and supply-price for any considerable range of variation in
the scale of supply, it follows that for some particular amount
supplied the demand- and supply-prices are equal, and for
lesser or greater amounts they are unequal. For a supply
in excess of the equilibrium amount, the demand-price may
be greater than, or less than, the supply-price. If the
former be the case, there is a stimulus to an enlargement of
supply, and the balancing of supply and demand has no
stability. If the latter be the case, the increase of the
aggregate supply, beyond the equilibrium amount, involves