188 
POLITICAL ECONOMY 
output of the industry will increase, inasmuch 
as the same amount of labour and capital 
at least will be employed in the industry, 
while more effective use will be made of them 
in view of the larger number of employers. 
We must also allow for the fact that an 
alteration in the number of employers through 
its effect, for instance, on the specialism of 
businesses, might in itself render the industry 
more or less productive. A new position of 
equilibrium will eventually be reached at 
which the surplus left in each business for the 
employer is less. This movement will con 
tinue until the surplus remaining for employers 
is just sufficient to induce the continued 
functioning in the industry of as many 
employers as there are. 
Were the surplus too small instead of too 
large, some employers would be working at a 
rate of pay at which it was not worth their 
while to continue working. Gradually, 
therefore, employers would begin to desert 
the industry, and no others would take their 
place, since it has been supposed that the 
earnings are insufficient to attract any fresh 
organising talent into the industry. Con 
sequently, for reasons already explained, 
businesses would expand in size, and the 
surplus left for employers would become