Chapter 10 Part 3a

The variations of the ratos between the Values the of Food and Non-Food Rude Produce Icon

January 26, 2020

89 The increase of food from the increasing cultivation increases the demand for the non-food produce of land. This demand will then be applied to use or to ornament.

There should be only one variation in the comparative values of the commodities for use and the commodities for ornament.

The value of non-food produce should constantly rise relative to food produce.

As art and industry advance, clothing, lodging, fossils, minerals, precious metals and stones gradually become more in demand.

  • Those commodities gradually exchange for more food.
  • Food should then gradually become dearer.

This is the general case if accidents did not increase the food supply more than the demand.

90 For example, the value of a free-stone quarry’s produce will increase with the increasing improvement and population of the district around it, especially if it were the only one in the district.

But the value of a silver mine’s produce will not increase with the district’s improvement. The market for stones from a quarry is frequently near it. Its demand must be proportional to that district’s improvement and population. The silver mine’s market may be global. Unless the world is advancing in improvement and population, the demand for silver might not be increased by the improvement even of a large district with a silver mine. Even if the world were improving, silver prices would fall if new, more fertile mines were discovered to increase the supply more than the demand.

91 The commercial world is the great market for silver.

92 If, by the progress of improvement, the demand increases while the supply did not increase, the value of silver would gradually rise in proportion to the value of wheat.

  • Silver would buy more wheat.
  • The average money price of wheat would gradually become cheaper.

93 On the contrary, if the supply increases more than the demand, silver would gradually become cheaper. The average money price of wheat would become dearer in spite of all improvements.

94 If the supply of silver increases in proportion to the demand, it would continue to buy nearly the same amount of wheat. The average money price of wheat would stay nearly the same.

95 These three are all the possible combinations of events which can happen in the progress of improvement. These have happened in the European market in the past 400 years.

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