Economic Problems

Dominion, Volume 24, Issue 50, 22 November 1930, Page 13

Economic Problems

Sir, —Your correspondent who signs W. Maddison,” and who- dogmatises in the Press on many subjects from time to time, is right to-day, in that it. is no use cutting wages unless such reduction lowers retail prices,. otherwise only the retailer reaps tile benefit. We have listened • recently to a legal luminary generalising on “Rationalisation of Industry.”' Ono important point ho did not stress is, can the lecturer name any expert economist—-not the dillotnnte kind—who has demonstrated that theoretical saving by mergers has benefited, the ultimate consumer by a reduction in retail Price. ' . ~ We get lectures on rationalisation akin to what is usually dished up in magazine , articles by amateur economists, who pass on theories obtained from other magazine articles by other amateurs. If rationalisation lowers cost it-also eliminates competition, an element required, to give the consumer a fair deal. If mass production cost we should get some cheap law. but it is not noticeable that we do, although we get production in bulk, as heaven and the taxpayer knows. Let ns have wages cuts by all means, but let us also . have lower retail prices to ! the same extent. —I am, etc., WORKER. Wellington. November 10.