Although observers of the Pakistani economy are well aware that a small number of family groups, popularly called "the twenty-two families," dominates the industrial structure of the country, the actual effects of this concentration of economic power on income distribution and on other areas of widespread social and political concern arc less well understood. In this important work, Lawrence J. White uses the concepts of industrial organization analysis to achieve an overall view of the problems stemming from the marked industrial concentration in Pakistan. After discussing the economic effects of industrial concentration as they apply generally to less developed countries, Professor White reviews the Pakistani experience, estimating the overall concentration of power that exists in manufacturing, banking, and insurance. Following an estimate of the extent of concentration in individual markets, he examines the origins of this concentration of power and analyzes its economic and noneconomic effects in Pakistan. The author concludes with a review of the policies that Pakistan has pursued in dealing with industrial concentration and suggests new courses of action for the future. Originally published in 1974. The Princeton Legacy Library uses the latest print-on-demand technology to again make available previously out-of-print books from the distinguished backlist of Princeton University Press. These editions preserve the original texts of these important books while presenting them in durable paperback and hardcover editions. The goal of the Princeton Legacy Library is to vastly increase access to the rich scholarly heritage found in the thousands of books published by Princeton University Press since its founding in 1905.

The publication of this clinically analytical and trenchantly insightful volume is felicitously timed. By fortuitous coincidence, it comes at a time when the Chicago School enjoys a high-water mark of acceptance in U.S. legal circles, and at a time when the U.S. merger movement of the 1980s is cresting. It provides a welcome warning against the dangers of translating abstract theories, based on highly restrictive (and unrealistic) assumptions, into facile public policy recommendations. As such the Schmidt/Rittaler study serves as a needed antidote to the currently fashionable predilection to confuse ideology with science. In the Chicago lexicon, the only appropriate policy toward business is a policy of untrammeled laissez-faire. Because there are no market imperfec tions (other than government-created or trade-union-generated monopolies), the market can be trusted to regulate economic activity, inexorably meting out appropriate rewards and punishments. In this ideal world, corporate size and power can be safely ignored. After all, corporations become big only only because they are efficient, only because they are productive, only because they have served consumers better than their rivals, and only because no newcomers are good enough to challenge their dominance. Once an industrial giant becomes lethargic and no longer bestows its productive beneficence on society, it will inevitably wither and eventually die. This is the "natural law" that governs economic life. It demands obedience to its rules. It tolerates no interference by the state.