Show nature of competition vastly changed from former days development of new products and raw materials added to price rivalry W washington are our gl giant glatie atit corporations po rations holding down living standards by holding up prices in an effort to make exorbitant profits has competition declined so that the production and distribution of 0 goods needed for higher living standards is being hindered A study which has just been completed at the brookings institution found that competition is as real as in former days perhaps more real but it operates in a different way weekly wages and wholesale prices of manufactured products INDEX INDEX NUMBERS zoo WA 1 1 I 1 50 0 0 1870 1880 1890 1900 1910 ISSO 1990 1900 1940 the amount that could be bought with a weeks wage INDEX MD EX NUMBERS INDEX NUMBERS SO too 00 1 0 r 1 1 SO 50 jo fl 0 I 1 10 1870 1880 isso 1890 1900 isio 1910 1910 1920 isso 1930 1340 1940 these charts indicate in general how living standards have risen since 1870 during which years there have occurred the greatest development of machine production and the growth of large corporations the upper chart shows that although the wholesale prices of manufactured goods were about 9 per cent lower in 1937 than in 1870 the weekly wage had increased more than per cent the lower chart shows how much a worker could purchase with his weekly wage assuming that retail prices kept in step with wholesale figures in 1937 it was nearly three times as much asin 1870 this increase came in spite of the fact that the length of the working week was reduced by approximately one third during this period manufacturers today compete not only in the pricing of their products but also in the development of new products and new uses for raw materials the result may be even more useful to the people as a whole than in the days when the prices of nearly all goods were fixed by direct bargaining in the market the making of prices over a large part of industry is vastly changed from what it used to be the producer estimates in advance a price at which an article can be bought by an expanding number of people and then finds a way to burn turn out a product within that price almost everyone Is aware that this is the way automobile prices are set and the study found that the three largest concerns in this industry have set the high water mark of competition thus far today it is almost impossible tor for so called monopolies to keep prices unduly high in order to make big profits advances in physics chemistry and engineering have been so great in recent years that whenever a corporation tries to do this some one 0 ne comes along with a satisfactory substitute at a lower price previous studies made at the brookings institution indicated that the best method of passing on to the public the benefits of improved productive efficiency Is by giving the consumer lower prices policies of many corporations are examined in the latest study entitled industrial du price policies and economic progress specific inquiries were made into the policies of many manufacturing concerns to find out whether they were aimed in this direction the study was made by dr edwin G nourse director of 0 economic research and dr horace B drury a member of the staff it was financed under a grant by the maurice and laura falk foundation ot of pittsburgh big corporations since the world war have sought to effect acono mies and promote efficiency the study found this ts is in contrast to the aim of combinations ot of a generation ago which was chiefly to control markets suppress competition and raise prices some ot of these older combinations were able to hold up prices tor for a time but eventually ven such attempts broke down or arouse aroused ed so much resentment that the combinations were dissolved by governmental actions the sudy study did not find that the percentage of the nations business done by giant corporations has b been een in increasing creasing production by such large enterprises comprises about 40 per cent of the total which is about the same percentage as obtained a generation ago big and little companies work together the study shows how big and lit tle companies work together to the advantage of both large corporations are generally able to LO spend more freely to maintain competent technical and management staffs and these companies have usually been in the front of price reduction but smaller concerns also benefit from this large scale production with larger concerns purchasing their supplies in large quantities and planning production tar far in ad vance smaller companies which sell them supplies and raw materials are in turn able to plan production on the most economical basis many small concerns also find it easier to borrow money from local banks and other sources when they have contracts with large corporations operation of industrial enterprises at their practical capacity Is nece necessary it the nation Is to have maximum production of goods the report of the study says forward looking price policies constantly aiming toward giving the consumer more for his money were found to he be the most important factor in bringing about capacity operation the high level of employment which would come with such capacity operation would have far greater effect in raising living standards than any employment which the government could provide since 1870 while our large corporations po rations have been developing the amount of manufactured goods which the average workers weekly wage would buy was multiplied by two and a half at the same time the working week was reduced by about one third i fa |