Full text: Introduction

independence were borne out by the developments since. 
One has to take into account the emergence and vast growth of new 
industries mostly composed of small firms (new types of service industries of 
various kinds, like repair shops and laundries, etc.). Further, the tendency 
for large industrial concerns in some industries to subcontract work has been 
widespread. In retail trade and service industries a kind of polarization seems 
to take place in advanced industrial countries: On the one hand the bulk of 
essentials is traded in self-service shops which are best carried on on a not 
too small scale; on the other hand, special shops with expert and personal 
service are established on a fairly small scale in certain goods ("boutiques" 
for women’s dresses, etc.). This bifurcation is by no means only a matter of 
rich and poor customers, but a natural division of functions which is likely to 
stay. In the same way the experimenting small firms in manufacturing can exist 
in cooperation with big concerns and even retain a large degree of autonomy if 
they are able to develop and offer technological know-how, which in some cases 
they are able to do better than big laboratories. For this reason, the small 
establishment combined with expert and highly trained personnel has a role to 
play in a reasonable organization of the economy. 
While there is no doubt that in these special fields the small firms 
continue to have considerable room for continued existence, the rest of the 
economy exhibits the domination of the large scale business today more than 
ever. Several factors have come to the fore as favouring the large concerns 
even more than formerly: One is automation: The other is the increasing 
importance of research and development, much (although not all) of which is 
carried on most easily by large firms. Finally there is the computer which 
can be used to offset some of the dis-economies of large scale: The problems 
of organization, arising from the complexity of lines of communication and 
interrelation of decisions which beset the large firm and lead to rigid 
cumbersome bureaucratic rule - these problems can indeed to a large extent 
be solved by a suitable application of the computer. This makes it possible 
to deal with problems of great complexity and many details and the computer 
can therefore establish the coordination of a great number of decisions. In 
principle it can serve to operate effectively a controller of great complexity. 
All the developments just mentioned have become prominent only in the 
course of the last 25 years. Rather more recently attention has been drawn to 
a development which is not new but has been accelerating recently and is being

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