factor, with an inertia which the cajolery of price-changes is
powerless to disturb. This is a most important fact, and it gives rise
to some peculiar features of the price and rent of land, which we
shall have to consider later as a separate problem. It constitutes a
limiting case rather than an exception to the general law. But we have
not yet done with the reactions of price upon supply. In the case of
capital, the nature of those reactions has been much discussed as a
highly controversial question. That a rise in the rate of interest
will cause some people to save more than before, is generally
admitted; but it is pointed out that the effect upon others may be the
exact opposite, because it means that they do not need to save so much
to acquire the same future annual income. It is unwise to say
dogmatically that the former tendency outweighs the latter; though
upon the whole it seems highly probable that it does. We cannot,
therefore, in this case feel confident that a change in price will
react upon supply in the manner which our law indicates. Similarly it
is possible to argue that a rise in the general level of real wages
may reduce the supply of labor, even, or some might say particularly,
if the term is used to denote not the number of workpeople, but the
quantity of work done. For there may be a tendency for workpeople,
when more comfortably off, to work less regularly or less hard. Here
again we cannot be sure. In none of these cases, however, including
that of land, is there any reason to doubt that a rise in price will
diminish _demand_, or conversely that a fall will increase it. Since,
therefore, in the reasoning by which we deduced the third law, the
conclusion will hold good, even if the effects of price-changes on
supply are of the above paradoxical kind, provided that they do not
continually outweigh the effects upon demand, there is no reason to
cast doubt on the solidity of Law III, which, indeed, as we suggested
before, commends itself directly to experience. But Law II seems now,