Monopolistic Competition in Retrospect

George Stigler

Chapter 8 in Readings in Industrial Economics, 1972, pp 131-144 from Palgrave Macmillan

Abstract: Abstract Before the Great Depression, that chasm between darkness and light, economists had generally looked upon the economy as a mixture of industries that approximated conditions of perfect competition and industries that were ‘monopolies’. The competitive industries, it was believed, were satisfactorily analyzed by the theory of competition, and although the ‘monopolies’ were diverse in structure and power, they could be informatively analyzed by a discriminating use of the theory of monopoly. Individual economists varied considerably in the relative importance they attached to these two groups of industries, of course, but they varied surprisingly little in the type of analytical system they deemed appropriate to the analysis of economic events. This is not to say that the details of the analytical system were, or were thought to be, definitive: indeed certain portions of the system, such as duopoly, admittedly were (and are) in wretched shape.

Keywords: Demand Curve; Perfect Knowledge; Monopoly Profit; Uniformity Assumption; Monopolistic Competition (search for similar items in EconPapers)
Date: 1972
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DOI: 10.1007/978-1-349-15484-5_8

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