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This paper reconsiders the proposition put forward by many economists that monopolies would produce less durable assets than would competitive firms. The key assumption made is that assets are desired for the services they provide. It is shown that, as all firms desire to minimize the cost of providing any given service, monopoly and competitive firms will select the same degree of durability. Although this result is proved for goods subject to exponential decay, the result can be generalized to an arbitrary decay function. A number of earlier writers reached mistaken conclusion basically because of their neglect of the initial demand for the good. Durability choice by a monopolist is unaffected by price or demand conditions so long as the firm is permitted to operate in the elastic portion of the demand curve. Price regulation will have no effect on the choice of durability unless an attempt is made to force the firm to operate in the inelastic portion of the demand curve. If this attempt is made, output will remain unchanged and costs will be increased so as to satisfy the unit cost mark-up constraint. In this case, the regulator should ensure that durability remains unaltered at the previous level.

Some casual evidence suggests and popular imagination maintains that planned obsolescence is an increasingly important feature of durable goods production in modern capitalist economies (for example, Packard 1961, chaps. 5-12). How often does one hear someone exclaim, "They don't make autos, houses, television sets, etc., which last as well as they did in father's day!" Popular explanations usually attribute such phenomena to the increasing significance of monopoly elements in the economy. In the light of this, we shall mean by "planned obsolescence" the production of goods which are less durable than would arise out of production by perfectly competitive industries.' In recent years, a number of attempts have been made to examine planned obsolescence in the context of economic models. Several authors namely, Martin (1962), Kleiman and Ophir (1966), Levhari and Srinivasan (1969), and Schmalensee (1970), have constructed models for a single durable good without substitutes. The inspiration for some of these

(1971). Natural Rubber Trade: The Implications of Synthetic Rubber Innovations. Applied Economics: Vol. 3, No. 1, pp. 57-66.

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Many of the processes used in the interpretation of geological and geophysical data basically involve the correlation or cross-comparison of related sets of well logs, seismograms, and other graphical data. Commonly the correlation is done by visual inspection. Two sets of graphical data are viewed side-by-side, and displaced relative to each other until a maximum degree of correspondence is observed. However, with the ever-increasing volume of accumulated geological information, there is a growing trend toward the automatic processing of data. The digital correlator described is a special-purpose computer specifically designed to perform correlation operations at speeds sufficiently high to permit "on-line" or real-time processing of geophysical field data. The paper describes the basic correlation process and, schematically, how the process is carried out in the correlator, and includes pictures and description of the correlator itself. End_of_Article - Last_Page 1762

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There is little in dispute between Lawrence J. White, in his "Note" in this issue, and myself, despite his claim to offer a more complete explanation for the existence of "sleeping" patents. In fact, his explanation is essentially the same as my own. He does not dispute my basic proposition that, under certain conditions, a monopoly controlling entry to the entire range of a group of sub,stitute products would introduce an identical range of products (but at smaller outputs and higher prices) than would be the case if perfectly competitive free entry conditions prevailed in all markets within the group.' In essence, these conditions require equality of the cross-partial derivatives of the price functions for products within the group and constant unit costs. In Case II White considers the situation in which entry is blocked in one market, but entry can take place in the production of another product that is a partial substitute for the original. In this case of incomplete or impure monopoly, naturally there are circumstances in which it would be profitable for an outside firm to enter in an endeavor to break down the monopoly pricing for the original product, while it would not be profitable for the firm with the monopoly in the original market to introduce the second product (except, possibly, as a last attempt to forestall entry). In these circumstances, there can be only one explanation for the desire of the original monopoly to purchase patents for the second product, without intention of use. By buying patents it hopes to forestall entry of outside firms and so preserve intact its original position, which could be endangered by the introduction of a close substitute. This must be the only explanation because, under the conditions specified, entry of any firm into the second market would be unprofitable with existing technology and costs, if competition were to prevail in the original market.

Genitourinary lesions specifically related to leprosy (Hansen's disease) are relatively few. Of considerable clinical interest and importance are the frequent leprous orchitis, testicular atrophy, and gynecomastia. A review of urologic literature reveals no reference to involvement of organs of the genitourinary tract by the Mycobacterium leprae. Of the standard urologic textbooks only Young's1refers to leprous orchitis. In the general literature of leprosy only passing reference is made to the genitourinary manifestations. Fox and Knott2described cutaneous leprous nodules on the scrotum and penis in 4 of 34 male patients. Serra3examined 200 patients with leprosy, describing vulvar lesions in 13%, preputial lesions in 10%, and lesions of the balanic sulcus in 5%. These lesions were especially common in patients with the nodular and mixed types of leprosy, although it is known that macular leprosy of the penis and vulva often mimics primary chancre. One patient presented

While economic theory has concentrated considerable attention on the firm as a user and accumulator of capital, analysis of its role as a producer of durable capital goods appears to have suffered comparative neglect. In recent years, however, a number of papers, inspired by the model of durable goods production developed by Wicksell in the course of his classical treatment of Ackerman's problem [10], have helped redress the balance. Modern writers, such as D. D. Martin [5], E. Kleiman and T. Ophir in this journal [3], D. Levhari and T. N. Srinivasan [4] and R. L. Schmalensee [6], have elaborated upon Wicksell's analysis by treating alternative time profiles of product decay and by considering the case of monopoly as well as that of competition. However, they have all followed Wicksell in confining their attention to an assumed long-run equilibrium in which the durability of the product, the rate of production, and the flow of services provided by the entire stock of the product, are all constant over time. The convenience of this long-run equilibrium assumption lies in the simple relationship it ensures between the rate of production and aggregate product services on the one hand, and between the price of the product and the price of its services on the other. These relationships allow the familiar Marshallian analysis of price and output determination under competition to be readily extended to the market for a durable good, and appear to permit a similar straightforward extension in the case of monopoly. Such simplicity nevertheless has its price. An analysis confined to situations of longrun equilibrium sheds no light on the behaviour of the industry in the short run, nor indeed on the conditions under which long-run equilibrium will be attained as a consequence of profit maximization. More seriously, by restricting their attention to positions of long-run equilibrium, those authors referred to above, who have extended Wicksell's results to the monopoly case, have been led to disregard Jevon's maxim that " in commerce, by-gones are for ever by-gones . . ."; an error which has produced the dramatic, but erroneous, conclusion that a monopolist will produce less durable assets than would perfect competitors operating under identical conditions of (constant) cost and demand. Thus one purpose of this paper is to analyse the production of durable goods, under the alternative regimes of competition and mol46poly, without imposing at the outset the assumption that the industry is in long-run equilibrium. Since the development of the industry over time depends critically on the relative importance of fixed costs, we treat the polar case, where all costs are escapable in the short run, in Part III, while fixed costs are introduced in Part V. A secondary objective is to identify, in Part IV, the error made in earlier long-run equilibrium analyses of monopoly and to show how the conclusion of Swan [7], [8], that

I. Introduction and summary, 627. — II. Assumptions, 629. — III. The monopoly and purely competitive decisions, 631. — IV. The generality of the results, 633. — V. Some concluding remarks, 635. — Appendix (to Section III), 636.