296. Supposing, on the occurrence of a glut, that new and
cheaper modes of producing are not discovered, and that the
production continues to exceed the demand, then it is apparent
that too much capital is employed in the trade; and after a time,
the diminished rate of profit will drive some of the
manufacturers to other occupations. What particular individuals
will leave it must depend on a variety of circumstances. Superior
industry and attention will enable some factories to make a
profit rather beyond the rest; superior capital in others will
enable them, without these advantages, to support competition
longer, even at a loss, with the hope of driving the smaller
capitalists out of the market, and then reimbursing themselves by
an advanced price. It is, however, better for all parties, that
this contest should not last long; and it is important, that no
artificial restraint should interfere to prevent it. An instance
of such restriction, and of its injurious effect, occurs at the
port of Newcastle, where a particular Act of Parliament requires
that every ship shall be loaded in its turn.
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