Abstract
THE COMPETITIVE APPROACH offers four fundamental theoretical advantages: prices are set at an economically desirable level, the level needed to bring forth the supply required to meet the existing level of demand; there is a constant downward pressure on costs, as less efficient producers must either modernize to meet the competition of their lower-cost rivals or go out of business; a constant stimulus is provided for the discovery and development of new products and processes; and resources automatically move out of industries where they have become redundant and into those where they are needed. For the regulatory and ownership approaches, attaining a “fair and equitable” price is within the area of possibility; the other three are difficult or impossible of attainment.
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Notes
Joe S. Bain, Barriers to New Competition, Harvard University Press, Cambridge, Mass., 1965, pp. 72, 158, 233.
Senate Subcommittee on Antitrust and Monopoly, Statement of January 30, 1975. Based on Frederick M. Scherer, Economies of Scale at the Plant and Multi-plant Levels, privately published, 1975, pp. 15–19.
A. C. Eastman and Stefan Stykolt, The Tariff and Competition in Canada, Macmillan Company, New York, 1967;
N. G. Brathen and R. M. Dean, The Economies of Large-Scale Production in British Industry, Cambridge University Press, 1965.
For a further discussion of these potential economies and diseconomies, see John M. Blair, Economic Concentration, Harcourt Brace Jovanovich, New York, 1972, Ch. VII.
John L. Enos, “Invention and Innovation in the Petroleum Refining Industry,” in the Rate and Direction of Inventive Activity, National Bureau of Economic Research, 1962, pp. 299ff. Reprinted in Hearings on Economic Concentration, Pt. 3, pp. 1,481–1,503.
Edwin Mansfield, Firm Size and Technological Change in the Petroleum and Bituminous Coal Industries, prepared for the Energy Policy Project, Ford Foundation, 1973.
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© 1976 John M. Blair
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Blair, J.M. (1976). The Remedies at Law: The Competitive Approach. In: The Control of Oil. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-81487-9_16
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DOI: https://doi.org/10.1007/978-1-349-81487-9_16
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