MONOPOLY AND COMPETITION

basic factors in the structure of economic markets. When economists use such words as monopoly and competition they have in mind certain complex relations among firms in an industry. An industry, as economists define it, is a group of sellers of close-substitute products who supply a common group of buyers. For the economy as a whole an industry would include all sellers having this relation. Thus one can recognize a cigarette or automobile or aluminum industryin all, hundreds of industries. Additional reading Noteworthy texts include William Fellner, Competition Among the Few: Oligopoly and Similar Market Structures (1949, reissued 1965), a highly sophisticated and stimulating development of the theory of oligopoly; Joe S. Bain, Barriers to New Competition: Their Character and Consequences in Manufacturing Industries (1956, reprinted 1993), an introduction of the notion of barriers to entry and discussion of their character, sources, and consequences as aspects of market structure, including empirical tests of their effects on competition, and Industrial Organization, 2nd ed. (1968), a general textbook covering theoretical and empirical aspects of problems of monopoly and competition, including a treatment of American public policies promoting or restraining competition; Carl Kaysen and Donald F. Turner, Antitrust Policy: An Economic and Legal Analysis (1959), a superior analysis and criticism of the working of American antitrust policies, coupled with detailed proposals for revision in these policies; Edward Chamberlin, Theory of Monopolistic Competition, 8th ed. (1962), a classic and germinal contribution to the theory of markets, notable for its revival and development of the theory of oligopoly and for its introduction and development of the concept of product differentiation; Joan Robinson, Economics of Imperfect Competition, 2nd ed. (1969, reissued 1976), a penetrating theoretical analysis of monopolistic and quasi-monopolistic pricing, complementing Chamberlin's work in many important ways; and William G. Shepherd and Clair Wilcox, Public Policies Toward Business, 6th ed. (1979), a good general textbook on public policies toward business, including extensive treatment of policies affecting monopoly and competition. Joseph A. Schumpeter, Capitalism, Socialism, and Democracy, 6th ed. (1987), provides a still brilliant analysis of various market structures; and Morton I. Kamien and Nancy L. Schwartz, Market Structure and Innovation (1982), follows nicely from Schumpeter's book. Charles E. Lindblom, Politics and Markets (1977), is also a classic and an excellent examination of market structures; and Richard E. Quandt and Dusan Triska (eds.), Optimal Decisions in Markets and Planned Economies (1990), offers a more current look at themes treated by Lindblom. Special topics related to market structure can be found in Don E. Waldman, Antitrust Action and Market Structure (1978); and Elhanan Helpman and Paul R. Krugman, Trade Policy and Market Structure (1989). Excellent treatments of industrial organization include Jean Tirole, The Theory of Industrial Organization (1988), a graduate-level text; Richard Schmalensee and Robert D. Willig (eds.), Handbook of Industrial Organization, 2 vol. (1989), a reference book at the graduate level; and Dennis W. Carlton and Jeffrey M. Perloff, Modern Industrial Organization, 2nd ed. (1994), an accessible intermediate-level text. Joe S. Bain The Editors of the Encyclopdia Britannica