chapter  7
11 Pages

The Military—Industrial Complex: A Market Structure Analysis

Some200yearsago,AdamSmithreportedonadisastrousexperimentinmercantiliststatecraft.Thegreattradingcompanies,hefound,hadbeenorganizedto conductGreatBritain'scommercein"remoteandbarbarousnations,"andto maintainfortsandgarrisonsforitsprotection.Choseninstrumentstoeffectuatea publicpurpose,theywereoftengivenexclusiveprivilegesandeitherhadthe righttoexcludeprivateadventurers("interlopers")altogether,ortotaxthemin returnforprovidingmilitaryandcivildefense.Thesecompanies,Smithfound, "haveveryseldomsucceededwithoutanexclusiveprivilege:andfrequently havenotsucceededwithone.Withoutanexclusiveprivilege,theyhavecommonlymismanagedthetrade.Withanexclusiveprivilege,theyhavebothmismanagedandconfinedit."