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POLITICAL ECONOMY 
feasible to do so, because after the supposed 
change in demand it would be profitable for 
them to do so. But at the same time the 
rise in price would render it possible for the 
would-be employer just excluded previously 
to make sufficient in the industry to induce 
him to venture his capital in it. So a new 
position of equilibrium would ultimately 
be attained with seven firms instead of six, 
all having a marginal cost higher than the old 
marginal cost, in the absence of effective 
tendencies to increasing returns ; and there 
would be a new marginal firm with a surplus 
left over for its employer which was just about 
adequate from his point of view to make it 
worth his while to manufacture. The new out 
put, we may imagine, would be 15,000 pairs of 
boots, and the price, say 14s. 3d., would tend 
to be the marginal expense in every one of the 
seven firms. 
One possibility reviving a consideration 
advanced earlier in the present chapter must 
be allowed for, and this exposition is com 
plete. Marginal business costs have been 
represented as rising with a growth of the 
industry. Such a representation is entirely 
right as regards what would immediately 
happen. But, as we have already learnt, the 
appearance of a new firm might ultimately