The Decline of Competition: A Study of the Evolution of American Industry

The Decline of Competition: A Study of the Evolution of American Industry

The Decline of Competition: A Study of the Evolution of American Industry

The Decline of Competition: A Study of the Evolution of American Industry

Excerpt

The rise of the "heavy industries," changes in methods of selling, and the widening use of corporate forms of business organization are bringing, if they have not already brought, the era of competitive capitalism to a close. These changes have swept across the industrial scene in America with remarkable speed since the closing years of the nineteenth century. Yet there has been astonishingly little analysis of their significance. Much has been written of the history of individual pools and trusts, and accusing fingers have been pointed at the increasing concentration of control over industry. This literature is founded upon naive conceptions of "competition" and "monopoly" and unreal assumptions concerning the possibility of reviving the competitive market. It has been too much concerned with judicial efforts to apply the anti-trust laws and too little with the underlying forces making for change and with the consequences of the manner in which they have been transforming the industrial system. On the other hand, the increasing practical importance of monopoly has been recognized in recent attempts to reconstruct economic theory in terms of "imperfect" or "monopolistic" competition. This literature, still very young, is, however, written in terms of high abstraction. I have endeavored in the present work to throw a fragile bridge across the wide gulf between these abstractions and the realities which they must finally comprehend.

Commencing with the data available concerning the industries in which change has been most notable, I have sought to specify the causes underlying changes in market conditions and to draw conclusions concerning the manner in which the contemporary quasi-competitive, quasi-monopolistic industrial system is operating. The history of the National Recovery Administration not only revealed the extent of the transformation of the market and the vigor of the forces making for change; it also uncovered our unreadiness to control these forces and even more completely our failure to realize the issues at stake. I have, therefore, also tried . . .

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