Essentials of Economic Theory: As Applied to Modern Problems of Industry and Public PolicyClark, John Bates
General
Essentials of Economic Theory: As Applied to Modern Problems of Industry and Public Policy
Clark, John Bates
Economics
_How Cost of Production and Cost of Acquisition are Equalized._--The
costs of moving goods from place to place--including in these costs
commercial charges and duties imposed by governments--are the cause of
most of the manufacturing that is done in the region represented by
the left side of the diagram, except the production of such articles
for immediate or local consumption as are necessarily made at or near
the places where they are used.[4] Tailoring, blacksmithing,
carpentering, general repairing, etc., would always be done in that
region, but many kinds of staple goods capable of being transported
would, in the absence of duties on imports, be made chiefly in the
region of dense population and cheap labor.
[4] There can be no large area from which manufacturing is
excluded. The rural hamlet has its blacksmith, wheelwright,
and carpenter, its sawmills and gristmills; and manufacturers
of sashes, doors, furniture, and many implements abound where
agriculture is the general industry. Special advantages for
production insure the introduction of other industries, and
the advantages of being near to customers is enough to
maintain many of them. Repairing must, of course, be done
everywhere, and in making some articles for local use it is
best that the artisan should be where the customer can always
reach him. A large cost of transportation favors local
industries, a high degree of productivity in agriculture has
an unfavorable influence, and a protective tariff on
manufactures reduces the returns from agriculture and favors
manufacturing industry.
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