Concentration and Competition

Abstract

THE DISCUSSION of these two subjects has been much confused by two conditions: a confusion of terminology and a neglect of the teachings of economic history. These two conditions are perhaps inevitable when large numbers of persons are intensely interested in matters requiring for their understanding more thorough knowledge of the subject than is possible for many nonprofessional students to acquire. They have been intensified by the spirit of the times, which causes many even of the professional economists to neglect the experience and the learning of the past and to assume that conditions are entirely new and require an entirely new theoretical analysis, preferably expressed in an entirely new terminology. For example, the term concentration is sometimes used to describe a state, sometimes to describe a process. Whether used in the static or dynamic it is applied with little discrimination to wealth, income, control, or even geographical location. Now it is obvious that we might have an existing condition of concentration without any recent or prospective increase in concentration. It is also obvious that we might have a concentration on any one of the four factors-wealth or income or control or location-without a concentration of any of the other three. Income is not all derived from wealth; most income is derived from labor. Ownership is not always necessary for control; the I.C.C. controls the railroads and the S.E.C. controls the stock exchanges, often contrary to the desires of the