But
it must always be kept in mind that, in the absence of a certain amount
of competition, such a policy cannot be taken wholly for granted. A
short-sighted management may prefer to reap large profits for a short
time and at the expense of the increased use of its product or service.
Moreover, the margin between the cost of production and the particular
price at which the product or service can be sold consistent with its
largely increasing use may enable the producer to gather enormous
profits; and such profits may not stimulate competition to any
effective extent, precisely because they depend upon advantages in
production which cannot be duplicated. No state desirous of promoting
the economic welfare of its citizens can remain indifferent to the
chance thus afforded of earnings disproportionately large to the
economic service actually rendered.
In dealing with this question of possibly excessive profits under such a
method of economic organization, the state has many resources at its
disposal besides the most obvious one of incessant official interference
with the essentials of corporation management.
Pages:
758
759
760
761
762
763
764
765
766
767
768
769
770
771
772
773
774
775
776
777
778
779
780
781
782