TWO COUNTRIES COMPETING IN A THIRD 107 
move from Germany to the United States, specie at first move from 
the United States to Germany ; in the end Germany would exchange 
cloth for American wheat. But English cloth already sells in the 
United States for $0.77, and Germanys supply price is that same 
figure — $0.77. Germany can gain nothing by the export of cloth 
to the United States, and the United States can gain nothing by the 
export of wheat to Germany. The barter terms of trade between 
England and the United States are 10 wheat for 13 cloth. This is 
precisely the domestic term of trade within Germany between 
wheat and cloth; domestic supply prices in Germany are adjusted 
to this situation. England and the United States find it advan- 
tageous to trade on these terms; and so long as they do so on these 
precise terms, Germany has nothing to do with either of them! 
! The reader will note that in arranging these figures of wages and prices I have 
followed the same plan of simplification as in the preceding chapter (Ch. IX); 
namely, that of keeping the American figures the same and making the changes 
in the German and English figures only. It is not to be supposed here, any more 
than it was to be supposed for the earlier figures, that the several cases represent 
successive stages, of which the later might develop from the earlier. Worked out 
for such successive stages, the figures would be different; but the principles eluci- 
dated and illustrated remain the same.