ABSTRACT
Monopoly capitalism has paradoxical effects on innovation; it has a rapid rate of technological progress but retains a large amount of technologically obsolete equipment. Paul Baran and Paul Sweezy argue that price behavior and profit performance are very different under monopoly capitalism than under a purely competitive model. The liberals stress that many evils are caused by monopoly power, but that it is temporary, and once the country gets back to competitive capitalism, everything will be wonderful. Liberals agree that monopoly is an evil aspect of capitalism, but they believe the evil can be ended without ending capitalism. The rate of growth under monopoly capitalism is also affected by the fact that the sales effort has greatly expanded. Advertising is the very offspring of monopoly capitalism, the inevitable by-product of the decline of price competition; it constitutes as much an integral part of the system as the giant corporation itself.
