134 
POLITICAL ECONOMY 
steel sags down and the slackness is passed on 
from the producers of iron and steel goods 
to the producers of the things out of which 
they are made. Again, when the engineers’ 
business is slack, earnings in it are reduced, 
with the result that the people engaged in it 
make fewer purchases than they did previously. 
Hence the depression tends to be passed on 
to the industries which supply their needs. It 
must be added, moreover, that sluggishness in 
a trade is apt to generate inertness and an 
oppressed state of mind in those who are con 
ducting it, and that this psychological mood 
is probably communicated to other business 
men through the intangible avenues which 
social psychology recognises ; and when 
employers are in a state of depression they are 
prone to shun risks, take a gloomy view of the 
future and curtail their undertakings. It is 
comprehensible, therefore, that the bad trade, 
wherever it starts, tends to spread ; and it 
may be, moreover, that there is some common 
cause of industrial collapse which bears directly 
on many trades at the same time. 
Another and even more striking feature of 
trade fluctuations is their periodicity. They 
recur with a certain degree of regularity. 
Trade depressions are not perfectly periodic, 
but they are not dispersed in an altogether