The transformation exacted a price from possessors of old skills and of sunk capital, which is why the Luddites went around smashing machinery.

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Yet each firm has sunk so much capital in plants that it is strongly tempted to use the capacity to build extra cars that fetch enough revenue to cover marginal costs in the short run, but not total costs in the long run.

ECONOMIST: Things look bleak for America's motor industry

Yet over the same period, their margins and return on capital have sunk.

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