George W. Stocking Sr.
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George Ward Stocking Sr. (September 24, 1892 – June 7, 1975) was an American
economist An economist is a professional and practitioner in the social sciences, social science discipline of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy. Within this ...
, who was one of the pioneers of
industrial organization In economics, industrial organization is a field that builds on the theory of the firm by examining the structure of (and, therefore, the boundaries between) firms and markets. Industrial organization adds real-world complications to the per ...
and an early writer on international
cartel A cartel is a group of independent market participants who collaborate with each other as well as agreeing not to compete with each other in order to improve their profits and dominate the market. A cartel is an organization formed by producers ...
s. After completing a Ph.D. degree from
Columbia University Columbia University in the City of New York, commonly referred to as Columbia University, is a Private university, private Ivy League research university in New York City. Established in 1754 as King's College on the grounds of Trinity Churc ...
in 1925, he was professor of economics at the
University of Texas at Austin The University of Texas at Austin (UT Austin, UT, or Texas) is a public university, public research university in Austin, Texas, United States. Founded in 1883, it is the flagship institution of the University of Texas System. With 53,082 stud ...
from 1926 to 1947. During 1933-1943 he held several positions with the federal government, including the Antitrust Division of the
U.S. Department of Justice The United States Department of Justice (DOJ), also known as the Justice Department, is a federal executive department of the U.S. government that oversees the domestic enforcement of federal laws and the administration of justice. It is equi ...
, where he advised Attorney General
Thurman Arnold Thurman Wesley Arnold (June 2, 1891 – November 7, 1969) was an American lawyer best known for his trust-busting campaign as Assistant Attorney General in charge of the Antitrust Division in President Franklin D. Roosevelt's Department of Justi ...
. He founded and was professor and chair of the Department of Economics at
Vanderbilt University Vanderbilt University (informally Vandy or VU) is a private university, private research university in Nashville, Tennessee, United States. Founded in 1873, it was named in honor of shipping and railroad magnate Cornelius Vanderbilt, who provide ...
in 1947, where he remained from 1947 to 1963. He was elected president of the
Southern Economic Association The Southern Economic Association (SEA) is a regional-based scholarly economic organization based at Texas Tech University Texas Tech University (Texas Tech, Tech, or TTU) is a public university, public research university in Lubbock, Texas, Un ...
in 1952, and of the
American Economic Association The American Economic Association (AEA) is a learned society in the field of economics, with approximately 23,000 members. It publishes several peer-reviewed journals, including the Journal of Economic Literature, American Economic Review, an ...
in 1958. Stocking was a pioneering economist of
industrial organization In economics, industrial organization is a field that builds on the theory of the firm by examining the structure of (and, therefore, the boundaries between) firms and markets. Industrial organization adds real-world complications to the per ...
. Stocking's most enduring research was published in three volumes: Cartels in Action (1946), Cartels or Competition? (1948), and Monopoly and Free Enterprise (1951). The first two volumes were seminal works in the field of empirical studies of
price-fixing Price fixing is an anticompetitive agreement between participants on the same side in a market to buy or sell a product, service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given ...
cartels A cartel is a group of independent market participants who collaborate with each other as well as agreeing not to compete with each other in order to improve their profits and dominate the market. A cartel is an organization formed by producers ...
; in them Stocking synthesized lavish quantitative and qualitative data on international
cartels A cartel is a group of independent market participants who collaborate with each other as well as agreeing not to compete with each other in order to improve their profits and dominate the market. A cartel is an organization formed by producers ...
in eight markets that demonstrated their internal mechanisms, pervasiveness in the economy, and effects on industrial performance. The third volume addressed the problems of
market power In economics, market power refers to the ability of a theory of the firm, firm to influence the price at which it sells a product or service by manipulating either the supply or demand of the product or service to increase economic profit. In othe ...
in the U.S. economy and public policies to ensure the benefits of free enterprise.


Education

Stocking graduated from Clarendon College in
Texas Texas ( , ; or ) is the most populous U.S. state, state in the South Central United States, South Central region of the United States. It borders Louisiana to the east, Arkansas to the northeast, Oklahoma to the north, New Mexico to the we ...
(BA 1918), the
University of Texas The University of Texas at Austin (UT Austin, UT, or Texas) is a public research university in Austin, Texas, United States. Founded in 1883, it is the flagship institution of the University of Texas System. With 53,082 students as of fall 2 ...
(BA 1918, MA 1921), and
Columbia University Columbia University in the City of New York, commonly referred to as Columbia University, is a Private university, private Ivy League research university in New York City. Established in 1754 as King's College on the grounds of Trinity Churc ...
(Ph.D. 1925). His mentors at Columbia were
Thorstein Veblen Thorstein Bunde Veblen (; July 30, 1857 – August 3, 1929) was an American Economics, economist and Sociology, sociologist who, during his lifetime, emerged as a well-known Criticism of capitalism, critic of capitalism. In his best-known book ...
and
Wesley Clair Mitchell Wesley Clair Mitchell (August 5, 1874 – October 29, 1948) was an American economist known for his empirical work on business cycles and for guiding the National Bureau of Economic Research in its first decades. Mitchell was referred to as Thor ...
.


Career

Stocking's first book was an empirical study of competition in the petroleum industry, in which he had worked as a "roughneck" in the oil fields of western Texas. While teaching at the University of Texas, Stocking had his first taste of public service as a member of the Consumer Advisory Board of the
National Recovery Administration The National Recovery Administration (NRA) was a prime agency established by U.S. president Franklin D. Roosevelt (FDR) in 1933. The goal of the administration was to eliminate "cut throat competition" by bringing industry, labor, and governmen ...
(NRA) in the mid-1930s, where he observed the destructive effects of the brief U.S. legalization of industrial cartels. When the
antitrust laws Competition law is the field of law that promotes or seeks to maintain market competition by regulating anti-competitive conduct by companies. Competition law is implemented through public and private enforcement. It is also known as antitrust l ...
were reinstated after about 1937, Stocking served through the early 1940s as an economic adviser to the great head of the Antitrust Division of the Department of Justice, Thurman Arnold. It was Arnold who initiated for the first time a large number of successful U.S. criminal prosecutions of international cartels in the mid-1940s. Information from these prosecutions and from Congressional investigations of the nefarious roles played by cartels in facilitating the economic policies of
national socialism Nazism (), formally named National Socialism (NS; , ), is the far-right totalitarian socio-political ideology and practices associated with Adolf Hitler and the Nazi Party (NSDAP) in Germany. During Hitler's rise to power, it was frequ ...
formed the basis of Stocking's two landmark books on international price-fixing cartels. In the 1950s, Stocking was involved in several issues that had lasting effects on antitrust enforcement. Perhaps Stocking's best-known journal article was a 1955 article in the ''American Economic Review'' that addressed what is now known as the " Cellophane Paradox." In research on the
DuPont Dupont, DuPont, Du Pont, duPont, or du Pont may refer to: People * Dupont (surname) Dupont, also spelled as DuPont, duPont, Du Pont, or du Pont is a French surname meaning "of the bridge", historically indicating that the holder of the surname re ...
company arising from his student's (Willard F. Mueller) Ph.D. dissertation, Stocking and Mueller pointed out the error of mistaking a monopolist's inability to exercise market power by raising price above the current price for an inability to have already exercised market power by raising price significantly above the competitive price. Courts that use a monopolized product's elevated market price will typically misconstrue a completed anticompetitive act as a lack of
market power In economics, market power refers to the ability of a theory of the firm, firm to influence the price at which it sells a product or service by manipulating either the supply or demand of the product or service to increase economic profit. In othe ...
. A second issue addressed by Stocking was the extent to which concepts of "
workable competition Effective competition is a concept first proposed by John Maurice Clark, then under the name of "workable competition," as a "workable" alternative to the economic theory of perfect competition, as perfect competition is seldom observed in the real ...
" and the "
rule of reason The rule of reason is a legal doctrine used to interpret the Sherman Antitrust Act, one of the cornerstones of United States antitrust law. While some actions like price-fixing are considered illegal ''per se', ''other actions, such as pos ...
" should be employed in antitrust enforcement.


Selected published works

*(1946), Cartels In Action (with M.W. Watkins) (Twentieth Century Fund, New York). *(1948), *(1951), Monopoly and Free Enterprise (with M.W. Watkins) (Twentieth Century Fund, New York). *(1955), 'The Cellophane case and the new competition' (with W.F. Mueller), American Economic Review 65, March, 29–63. *(1955), 'The Attorney General's Committee report: A businessman's guide through antitrust', Georgetown Law Review 44(1), November, 1–57. *(1961),


References


External links

*
George Ward Stocking papers
at the
American Heritage Center The American Heritage Center is the University of Wyoming's repository of manuscripts, rare books, and the university archives. Its collections focus on Wyoming and the Rocky Mountain West (including politics, settlement, Native Americans, and W ...
{{DEFAULTSORT:Stocking, George W., Sr. 1892 births 1975 deaths Vanderbilt University faculty Columbia University alumni University of Vermont faculty Presidents of the American Economic Association People from Clarendon, Texas Economists from Texas 20th-century American economists