Monopolists must also take into account the power of consumers to substitute one good for another. Usually as the price of a good rises, those consumers who are on or near the margin cast about for a substitute, since it is but a question of time, if prices continue upward, until their demand for that particular good will be nothing more than a desire; that is, their demand will have lost its effectiveness. Examples of the substitution of one good for another because of a rise in price are numerous and easily found, particularly in the matter of food and clothing. Who has not seen a substitute for butter, for eggs, for leather, or for furs? The first year of the Great War taught Americans more about substitutes than they had ever known before. Until that time millions of people were scarcely more than on speaking terms with bread made of corn meal, few knew the possibility of molasses for sweetening purposes, while scarcely one had ever dreamed that honey could be made from milk. Aside from government requirement, the chief cause for these substitutions was high prices, and here, as is always the case, "necessity was the mother of invention."

Substitution and competition as checks on monopolies cannot be entirely divorced. Independent enterprisers are eager, not only to attack the monopolist directly in his own field, but also to attack him indirectly by offering his customers substitutes. Thus, cement manufacturers, in so ar as their product is a substitute for iron and steel, compete just as truly with the steel trust as does the Bethlehem company; and they in turn must meet the competition of manufacturers of artificial plaster board. The methods adopted by manufacturers of substitute goods to push their product are significant. The maker of an egg substitute, for example, is not content to declare that his product is equal in every respect to fresh eggs. He goes further, by placing in the hands of housewives all sorts of cooking recipes in which the egg substitute can be used to advantage.