SUPPLY AND DEMAND 
67 
ually, and all specialism means economy in 
production. Moreover the augmented industry 
would offer a larger market to the subsidiary 
industries, which are the industries engaged 
in meeting its wants for appliances and acces 
sories, and they would, therefore, be able to 
supply it with its requirements more cheaply. 
Moreover it is possible that transportation 
in connection with the industry would so 
develop that the cost of carriage in relation to 
the industry would be reduced. Enough has 
been said to suggest the possibility, which will 
frequently be found borne out by fact, that 
with the expansion of an industry marginal 
cost might fall. 
But just as a new firm may have beneficial 
effects upon existing firms and depress 
their expenses, so it may have deleterious 
effects upon them and force up their 
expenses. Consider the case of farming in 
a densely packed country. An increased 
demand for farm products, meaning an in 
crease of the farming classes and of the 
capital devoted to farming, would compel 
cultivators to work the old land more inten 
sively and bring new land, inferior to the 
worst of the old, under the plough. So costs 
would rise. Of course these tendencies to an 
enhanced supply price might be counteracted