Marketing Costs and Economic Theory

T HERE has long been a standing argument between marketing men, on the one hand, and economic theorists and the public, on the other, as to the presumably high of marketing. The extreme argument of the economic theorists is that all selling costs reflect social waste, whereas the marketing man has argued that the of marketing are high primarily because of operative inefficiencies. The economists have tended to compare selling costs with those incurred by the firm under pure or perfect competition. By use of this model as a criterion, their conclusion is partially correct.1 This criterion, however, is what the marketing man has judged unsound on the basis that pure or perfect competition does not exist. Indeed, very few economists would disagree with them.2