Walter Froehlich on Röper’s Die Konkurrenz und ihre Fehlentwicklungen (1953)

Walter Froehlich’s journal book review assesses Burkhardt Röper’s account of competition, its failures, and its relationship to social welfare. His judgment is qualified: the book surveys important problems accessibly, but its attempt to make conventional market theory realistic and dynamic lacks conceptual precision. Froehlich distinguishes the usefulness of Röper’s coverage, especially for German readers, from the originality and theoretical adequacy of his analysis.

Röper proceeds from the nature of competition and its welfare properties to endogenous market disturbances, then to monopoly, oligopoly, and a graphical treatment of change over time. His exposition is nonmathematical and deliberately avoids many modern refinements. Its scope is also restricted:

Monetary and cyclical changes as well as problems of government intervention are excluded.

This limitation matters because Röper’s explanation of market malfunction concentrates on developments within the competitive economy rather than on monetary disturbances or intervention. His opening comparisons between competition and foot or horse races introduce differences in participants’ resources as well as their abilities. Definitions of pure and perfect competition and a demonstration of the static welfare maximum using Lerner’s criteria establish the benchmark against which subsequent failures are considered.

The central category, “maldevelopments,” covers endogenous changes that obstruct optimal individual satisfaction and aggregate welfare over the long run, under conditions of population growth and rising satisfaction of wants. Froehlich reports a broad survey: excessive price rigidity or flexibility, delayed and anomalous price responses, weak connections between prices and costs, external economies and diseconomies, and peculiarities of factor supply. Röper also examines structural imbalances near the public sector, exhaustible resources, and enterprises too small to employ one person fully. Froehlich finds the ensuing treatment of distribution, distributive costs, and advertising inconclusive, while approving the criticism of ruinous competition as a justification for cartels. The survey’s breadth is a strength, but does not itself supply a coherent account of workable market performance.

Röper’s treatment of monopoly and oligopoly attempts to capture the gradual shading of competition into other market forms. It considers changing costs and demand, alongside restraints on monopoly pricing imposed by possible intervention or entry. Froehlich identifies the principal claim:

The phenomenon is due largely to long-range competition from substitutes and long-range fear of newcomers.

The phenomenon is Röper’s “Competitive Monopoly”: an industrial monopoly that continually reduces prices and costs without necessarily reducing total profit. Potential rivalry thus constrains conduct even where current competition is limited. In oligopoly, Röper emphasizes compromise among sellers and uses kinked demand curves to explain group discipline. Froehlich nevertheless questions the realism of examining only sellers while neglecting bilateral monopoly and related configurations.

The review’s strongest methodological objection concerns Röper’s three-dimensional diagrams, which add time to conventional price and quantity axes. Froehlich argues that arranging successive demand and cost curves along a time axis does not resolve the underlying abstraction:

The traditional Marshallian curves do not refer to periods of real time but to partial abstractions from reality in regard to time periods under consideration by the seller.

Short- and long-run considerations coexist in agents’ expectations at any given moment; they are not simply successive chronological states. Adding families of conventional curves therefore cannot, by itself, produce a more realistic dynamic theory. Froehlich’s criticism distinguishes incorporating elapsed time into a diagram from explaining how economic decisions combine different temporal horizons.

His final assessment remains measured. Röper offers a reasoned, largely familiar investigation of competition and welfare, but would have gained firmer foundations from sustained engagement with J. M. Clark’s concept of workable competition. Froehlich does not demand the wholesale application of advanced Anglo-American welfare economics: criteria developed from concrete policy problems remain defensible even within contemporary welfare doctrine. The review’s significance lies in this distinction between useful problem-oriented economic analysis and an insufficiently grounded claim to theoretical realism.