Competition In Industry

S. R. Dennison, Professor of Economics, University of Belfast, writing in Lloyd’s Bank Review (January 1961) points out that the rediscovery of the virtues of competition in industry has been one of the most remarkable features of post-war Western Europe.

     Dealing with legislation intended to curb what are called “restrictive practices” which enable corruptions to eliminate competition, he says that the present trend against such monopolistic agreements is a corollary of the reaction against war-time government controls. The experience of government controls has generated a dislike of even comparable controls practised by private industry. The experience of nationalization and the realization that the creation of monolithic monopolies brings more problems and fewer benefits than had been expected have contributed to the conviction that greater economic progress and rising standards of living will issue, if the economy is not impeded by monopolistic arrangements, whether of the State or of private industry. Competition is at the root of freedom, despite all academic arguments to the contrary, and when the State takes up anything it is done always on the basis of a monopoly.

     The prejudice against capital arises out of blind ignorance of the natural laws of production of wealth. No wealth can be produced without investment of capital, any more than can a crop be raised without seed grain. The anger against profits is nothing but envy. Class conflict nurtured by short-sighted and envious persons is as ridiculous as it is vicious. Capital, and those who save wealth and make it serve society, are not monsters. They are instruments that serve society.