Knowledge that Transforms

Marketing, as I should define the term briefly, is a study of the principles that govern the policies of business management in the distribution of commodities from producers to consumers. This includes the activities of retail and wholesale merchants, manufacturers' sales organizations, the various agencies engaged in the distribution of raw materials, and all other means of facilitating and promoting the sale of merchandise. Take a shoe manufacturer, for example, who has just organized a new business. The first marketing problem for him is the determination of the agencies through which his product is to be sold. He has a choice between selling entirely to wholesalers, entirely to retailers, or to both. He has a choice, furthermore, between the various types of retailers-unit stores, department stores, chain stores, and mail-order houses. He probably will find it inadvisable to plan to sell to all these indiscriminately. Some degree of selection will be essential. There is also the possibility that he may elect to operate a chain of manufacturers' retail branches. Following this selection of agencies, and interwoven with that problem, questions relating to the manufacturer's sales organization arise. How large a sales force shall he maintain? What plan for management of the sales force is to be developed ? Is a stock department to be operated? Then come the problems of brands. Is this manufacturer to sell his product unbranded, entirely under his own brand, or under wholesalers' and retailers' private brands? What is to be his advertising policy? How are his shoes to be priced ? These are roughly the marketing problems that the shoe manufacturer must consider. Take another case. I recently had an inquiry from a young man who is just about to engage in a new business venture. He

The subject of accounting, which for a long time was looked at askance and treated as a stepchild among courses in economics, has now come to be rather generally recognized as essential to the training of an economist, entirely aside from its place in business training. Courses in accounting now appear on the schedules of departments of economics in most of our universities and colleges. The reason for this is that economists have come to recognize that almost any kind of study of the working of economic forces in the business world of today requires, among other things, an understanding of (i) the manner in which the status of a business investment is commonly set forth, (2) the facts to be considered in determining the successfulness of a business investment, and its status at a given time, and (3) the type of information needed by the business manager as an aid in controlling the investment, and the methods by which such information may be gathered. But in spite of the growing recognition of the need for an understand? ing of these matters by the economist, it is still easy to find evidence in the writings, public addresses, and classroom utterances of some economists of high standing that these men have not given sufficiently careful consideration to the nature of a business investment and the

Prof essor Carver' is a welcome addition to the steadily increasing number of economic students who are dissatisfied with the neoclassical limitations that have been imposed upon economic theory. He has joined the "welfare crowd," his volume being dedicated " to all those who care to see their country grow great and strong. " Viewing with high scorn the common doctrine that the economist should concern himself only with the means of satisfying desires, without considering the possible detrimental effects to the race, he accordingly deplores the lack of attention that has been given to consumption by writers on political economy and remarks that "a few students are beginning to discover that consumption is more important than production, exchange and distribution-possibly more important than all three combined" (p. ii). "Consumption reacts powerfully upon all other departments, particularly upon distribution" (p. 455). This emphasis upon consumption and upon the concept of welfare meets with the reviewer's unqualified endorsement. I have always failed to understand why economists should lay such emphasis upon "long-run" considerations and then persist in counting all things as wealth so long as they momentarily satisfy individual cravings, regardless of their ultimate economic and social consequences. The narrow definition which makes whiskey wealth because it has utility has not tended to commend economic analysis to the favorable consideration of those whose interests lie in the field of public welfare. There could, of course, be little objection to the classical definition of wealth if the economist were satisfied to admit at the conclusion of his analysis that it had little bearing on problems of long-run economic development or on matters of practical statesmanship. But this he is seldom content to do. He fancies that, like Adam Smith, he is really concerned

The problem of research in collegiate schools of business may be approached from two points of view. Broadly, they may be put thus: first, what are the standards to which research in business must conform; and second, why, if at all, and under what circumstances and conditions should collegiate schools of business undertake research in an organized manner through a separately established department or bureau? There is little occasion before this Association to enumerate the different steps in research, or to discuss at length the standards to which research in business must conform. In view of the so-called research activities of private establishments and commercial agencies, however, and the contentions of the second part of this paper, that collegiate schools of business should organize separate research departments, it will, I hope, not be considered as an act of supererogation to review briefly the minimum requirements which must govern in business research. The majority of teachers of economics and business, perhaps, have come to their positions after having themselves undertaken

The reports from the 1920 census have apprized everyone who was not already informed that the tremendous growth of the auto? motive industry has carried Detroit into fourth place in population rank. It was in the belief that such an industrial Mecca, which had drawn its multitudinous votaries from every section of the continent and even farther, would be an ideal place for an intensive study of the currents of opinion among workingmen and the pre? vailing conditions of labor in a progressive factory town that the writer spent several weeks during the past summer making a first? hand investigation of the labor situation there. He had numerous conferences with employment managers, industrial managers, chiefs of operation, and like officers having to do with personnel in a vari? ety of plants. For it should not be overlooked that there are other important industries besides automobile manufacture in the City of the Straits. It has several large stove and furnace works, some big pharmaceutical laboratories, and various sorts of machine shops. These have contributed not a little to the prosperity of the city, though the expanding production of motor cars trucks and tractors has been the chief factor, of course. In the main this article is concerned with conditions in this leading industry. In addition to these conferences with officials of many different firms, and thanks to their courtesy, the writer has gone into the shops and worked among the men. Dressing and speaking like the ordinary wage-earner he has been able to gain from them in the casual conversation along the bench or over the machine or on the window ledge at noon-hour, knowledge and information about the workingman's state of mind and his status in industry which could not have been acquired elsewhere. Incidentally it 1 There is no attempt in this article to set forth the current situation with regard to employment. In that respect there has been a great change since the paper was written, in the latter part of August. But this feature has so little bear? ing upon the broad outlines of labor policy treated herein that it has not been deemed advisable to make any modifications in the text on that account.

Note.--This number of the Journal of Political Economy is given over to the leading papers and discussions of the first meeting of the Association of Collegiate Schools of Business which was held at Harvard University, November 13, 14, and 15, 1919. It is a matter of regret that illness prevented Dean Herman Schneider, of the University of Cincinnati, from preparing for publication his paper on "The Coordination of Business and Engineering Courses."