Essentials of Economic Theory: As Applied to Modern Problems of Industry and Public PolicyClark, John Bates
General
Essentials of Economic Theory: As Applied to Modern Problems of Industry and Public Policy
Clark, John Bates
Economics
_The Law of Survival of Efficient Organization._--In broad outlines we
have depicted the conditions which favor technical progress. There is
a law of survival which, when competition rules, eliminates poor
methods and introduces better ones in endless succession. Under a
regime of secure monopoly this law of survival scarcely operates,
though desire for gain causes a progress which is less rapid and sure.
The same may be said of changes in organization, in so far as that
means a cooerdinating of the labor and the capital within an
establishment. When the manager of a mill so marshals his forces as to
get a much larger product per man and per dollar of invested capital
than a rival can do, he has that rival at his mercy and can absorb his
business and drive him from the field. In order to survive, any
producer must keep pace with the aggressive and growing ones among his
rivals in the march of improvement, whether it comes by improved tools
of trade or improved generalship in the handling of men and tools.
Quite as remorseless as the law of survival of good technical methods
is the law of survival of efficient organization, and so long as the
organization is limited to the forces under the control of single and
competing _entrepreneurs_, what we have said about the advance in
methods applies to it. It is a beneficent process for society, though
its future scope is more restricted than is that of technical
improvement, since the marshaling of forces in an establishment may be
carried so near to perfection that there is a limit on further gains.
Moreover organization, in the end, ceases to confine itself to the
working forces of single _entrepreneurs_, but often continues till it
brings rival producers into a union.
_The Extension of Organization to Entire Subgroups._--Both of these
modes of progress cause establishments to grow larger, and the
ultimate effect of this is to give over the market for goods of any
one kind to a few establishments which are enormously large and on
something like a uniform plane of efficiency. Then the organizing
tendency takes a baleful cast as the creator of "trusts" and the
extinguisher of rivalries that have insured progress.
Public-domain text, read in full here on John Shaqi.
Reviews
Reviews
No reviews yet
Be the first to share your thoughts on this work.
Elsewhere in the archive
Join the Discussion
Join the discussion
Sign in to leave a comment or review.
Sign InorCreate an account