Conglomerates and the evolution of capitalism Book

What motivates a firm to become a con­glomerate? How do conglomerates change the structure of the economy? What effects do conglomerates have on both output and labor markets? How do conglomerates affect the evolution of capitalism?

These questions motivated Spruill to write his book. He had noted an "insatiable ap­petite on the part of large firms to become larger and more diversified. For instance, Gulf and Western had expanded to the point where its product lines included auto parts, aerospace, electronics, minerals, and movies. Beatrice Foods produced, among other things, ice cream, peanuts, and toilet seats."

Spruill's book contains a wider scope than that of any other economist surveying the emergence of conglomerates. After tracing the history of capitalism and its evolution into the conglomerate movement in chapter 1, he delves into the reasons firms diversify in chapter 2. His third chapter offers new data concerning the degree of diversification in the manufacturing sector of the economy.

Chapter 4 focuses on the power relation­ship between labor unions and conglomerate firms; conglomerates erode union power, and the unions are fighting back. Chapter 5 is an institutional analysis of the evolu­tion of capitalism, concentrating on the na­ture of the economic system in light of its progression from Jeffersonian capitalism to monopoly capitalism to conglomerate cap­italism. Chapter 6 discusses reasons for gov­ernment vacillation in implementing policy concerning conglomerates.

The Federal Trade Commission and the Justice Department are daily embroiled in conglomerate merger activities: the ques­tions and issues confronted by these agencies are the questions and issues Spruill confronts in this book.