THEORY OF INTERNATIONAL VALUES
625
duction is limited,1 it is not so much matter which instrumentality
is adopted.
B. We come now to the category of foreigners, which, as
already observed, is nearly coincident with that of mathematicians.
(1) Cournot.—The lesson of caution in dealing with a subject
and method so difficult is taught by no example more impressively
than by that of Cournot. This superior intelligence, equipped
with the most scientific apparatus, seems not only to have slipped
at several steps, but even to have taken a wholly wrong direc-
tion. He has not only committed errors in formal reasoning,
but also has missed general conceptions appropriate to the
subject. '
Of several paradoxes which occur in that part of the Principes
Mathématiques which more immediately relates to International
Trade,2 perhaps the first is among the few that are not open to
suspicion. This is the proposition that, when a communication
is opened between two markets, previously separated by a barrier,
the total quantity produced of any commodity which now begins
to be exported from one market and imported to the other will
not necessarily be increased. Bor if a flow sets in from market A
to market B, the production of the commodity in A must be
increased, and its price in that market heightened—the law of
decreasing returns prevailing; while in B the price will be
lowered, and the quantity produced in that country will be di-
minished. The increase of the production in A may not com-
pensate the decrease in B ; when the demand in A is very
inelastic, and the rise in the cost of production with the amount
produced very steep, while the contrary properties are true of B
(Art. 68).
A similar proposition is true of the total value of the product
(Art. 69).
The conditions under which these propositions are true are
well expressed by Cournot’s symbols, in which ∩a(p) = the
amount offered by the producers in A at the price p, and Fa(p)
means the amount demanded by the consumers in A ; with similar
interpretations of Ωb(p), Fb(p). Thus, before the communication,
∩a(pa) = Fa(pa) ;
pa being the price of the article in the market A ; and, after the
communication, if the commodity is exported from Ato B, e being
ɪ Ante, p. 46.
2 Recherches sur les Principes Mathématiques de la théorie des richesses (1838),
ch. x. xi. xii.