VALUES IN INTERNATIONAL TRADE 205

&gt;wn under the new conditions. The application of this
energy in other industries might press the margin of productivity
 in them somewhat lower than before, but, by being
distributed over numerous industries, the extent of reduction
of productivity in any one would be likely to be less than
when the whole was engaged in the one employment. Some
part of the absorption of the displaced productive power
might well be either in industries of increasing return or
those of constant return, or, if in those of decreasing return,
then in such as show a less rate of decrease than the industry
from which the productive power is released. Since the
increase of supply of the imported product needs to be paid
for, there must be a demand for a part, if not for the whole,
of the released power of production, in enlarging the supply
of the commodity or commodities the export of which is
needed to purchase the enlarged supply of imports. In so
far as the cheapening of imports arises from a cessation or
reduction of a tax on importation, the enlarged supply of
imported goods will mean an enlargement of the compensation
to their foreign producers. Only if the enlarged demand
enables the producer to sell at a lower price will the
compensation to producers increase in less proportion
than the amount imported. Thus the amount of exports
needed to pay for the enlarged imports will be extremely
likely to increase. The cost to the buyers of the goods may
not increase much, for the fall of price may not be much
more than compensated for by the increase of quantity
bought. Yet even here there is likely to be an increase of
‘he cost to buyers, because the increase of purchasers is
very likely to be in considerably greater proportion than the
decrease of price offsets. The product of the quantity of
imports and the price per unit at which they are sold is,
then, likely to be greater, the product of the quantity and
the price per unit paid to the foreign producer is practically
sertain to be greater, and may be a good deal greater, after
than before the removal of the tax. Thus, as stated, the
production of exportable goods will need to be increased,
and an outlet for the productive power set free is thus
provided, though there is no assurance that it will be an