[38] From Railroad Operating Costs; by Suffern & Co., New York, 1911. [39] Lorenz in _Quarterly Journal of Economics_, XXI, pp. 283-292, is suggestive. [40] Change of accounting methods vitiates further comparisons of operating costs after 1907. [41] From Railroad Operating Costs, by Suffern & Co., New York, 1911. [42] _Cf. Yale Review_, 1910, pp. 268--288; with reference to the rate advances of that year. [43] _Cf._ the Free Cartage case, 167 U.S., 633. [44] _Quarterly Journal of Economics_, V, 1891, pp. 438-465. [45] Two important qualifications of this law, however, are set forth at p. 265, _infra_. [46] _Cf._ our Railway Problems, rev. ed., _circa_ pp. 684, 706. [47] The first successful attempt, as to soft coal rates to the lakes, is in 22 I.C.C. Rep., 613. Cf. 13 _Idem_, 423. [48] Wisconsin Railroad Commission Report, 1907, p. 101. Compare also Woodlock, p. 91; U. S. Statistics of Railways, 1894, p. 70; _Yale Review_, 1908, p. 382; and Record, Cincinnati Freight Bureau Case, II, p. 941. [49] 13 I.C.C. Rep., 423. Compare 9 _Idem_, 423; and _Yale Review_, 1908, p. 287. CHAPTER III THE THEORY OF RAILROAD RATES (_Cont'd_) The law of increasing returns, 71.--Applied to declining traffic, 73.--Illustrated by the panic of 1907, 75.--Peculiarly intensified on railroads, 76. Growth of mileage and traffic in the United States since 1889, 77.--Increase of earnings, 79.--Operating expenses, gross and net income, 80.--Comparison with earlier decades, 85.--Density of traffic, 86.--Increase of train loads, 88.--Limitations upon their economy, 92.--Heavier rails, 93.--Larger locomotives, 94.--Bigger cars, 95.--Net result of improvements upon efficiency and earning power, 97. The law of increasing returns due to financial rather than operating factors, 99.