Here we have a difficult subject to disentangle, and it will be as well to simplify it. Suppose a farmer is supplying a small village with potatoes, and by a new method of cultivation manages to double his crop for the former expenses of labour. What will happen as regards the price of potatoes? From our knowledge of what competition does in large production we are apt to say: “prices of potatoes will fall 50%.” This may be the final result, but not necessarily so, and at any rate the movement of price is instructive. The farmer is now able to sell at half the price if he wishes, but it is his interest to keep up the price as long as he can. What, however, will certainly happen, in normal circumstances, is that he will increase his production of potatoes. But it is not the case that, whatever nature and man produce, men will desire: it is, rather, that what man desires he usually sets nature and men to produce. To take off the extra supply of potatoes, then, the farmer must find a wider circle of demand than before; but there is nothing to lead us to suppose that there is any wider circle of demand at the old price. What we may safely suppose is that a great many housewives will buy extra potatoes if they can get them cheaper, but, in any case, the decision lies absolutely with them whether they will take more or not. It is easy to fall into the mistake of thinking that there will be a demand for everything produced if it is sold at a reasonable price, but this idea simply arises from the fact that producers anticipate desire and tempt demand. In the present case, demand must come from some level of want which was not satisfied at the former price, and is ready waiting to take up the extra supply if the price is brought down.