Sec. 7. #Some merits of competition#.  The dominant method of distribution to-day is that of competition.[7] This is not a mere accident, but is a resultant of unending experimentation with different methods of distribution carried on since the beginning of human society.  A method of distribution had to be found and retained that would work under the conditions of human nature at each stage of social progress; and competition, however imperfectly, has worked.  It is evident from the voices of praise and of blame that competition has its good and its bad aspects.  Let us observe first the good ones.  Competition acts to distribute the working force over the field of industry wherever it is most needed.  The remarkable (tho far from perfect) adjustment of industry to the needs of each neighborhood is brought about by individual motives, not by centralized authority.  Wherever consumers settle, stores are started and factories are built.  Wherever work is to be done, men come in about the right number to do it.  It is not mere chance that produces this result.  The available skill is adjusted to varying needs by the delicate measurement of the market rate of wages.  Two-sided competition gives a definite rule of price—­the only definite impersonal rule.  The theoretical competitive price is the standard to which things tend constantly to adjust themselves in an open market.[8]

Competition is an essentially economic method as contrasted with the legal and personal methods above and later described, because it is impersonal and reducible to a rule of value.  Distribution under competition is made, not with reference to abstract ethical principles or to personal affection, but to the value of the product.  Each worker strives to do what will bring him the largest return, and the price others pay expresses their estimates of the service in that market.  Each seeking his own interest is led to make himself more valuable to others.  In most cases and in large measure, competition stimulates men to sacrifice, to invention, to preparation; thus is zeal animated and are efforts sustained.  In the economic realm, as is now seen to be the case in the biologic realm, competition of some effective kind is an indispensable condition not only of progress but of life without degeneration.  Monopoly, as we have noted, never has ceased to rest under the ban of Anglo-Saxon law, and therefore to exemplify compulsory, as opposed to competitive distribution.  A striking feature of the competitive method is its decentralization.  Each helps to value the economic services of each.  If one pays more for the services of the singer than for those of the cook, it is not because one would rather listen to the singing than to eat when starving, but because by apportioning one’s income one can get the singing and the eating too.  In the existing circumstances, the singer’s services seem to the music lover to be worth paying for, and he backs his opinion with his money.  So each is measuring the services of all others, and all are valuing the services of each.  It is distribution by valuation, and it is valuation by democracy.