Rev Ind Organ (2012) 41:157–179
“On a Level with Dentists?” Reﬂections on the
Evolution of Industrial Organization
Published online: 8 August 2012
© Springer Science+Business Media, LLC. 2012
Abstract This essay provides a brief overview of the evolution of the ﬁeld of indus-
trial organization from its emergence to the present, and it offers some observations
about the present state of the ﬁeld. While there has been considerable progress in
industrial organization over time, its uphill path has not been straight.
Keywords History of thought · Evolution · Industrial organization
In 1930, writing about “Economic Possibilities for our Grandchildren,” Keynes (1930,
p. 373) opined that “If economists could manage to get themselves thought of as hum-
ble, competent people on a level with dentists, that would be splendid!” In this essay
I offer some observations on the evolution of industrial organization economics and
consider at the end whether its practitioners have come to deserve to pass Keynes’
I use the word “evolution” rather than “progress” or “development” deliberately.
Just as predator and prey evolve together in natural systems, and evolution there is
This paper is based on my keynote address at the International Industrial Organization Conference, March
17, 2012. I am indebted to Christopher Knittel, Jonathan Levin, Ariel Pakes, Nancy Rose, Stephen Ryan,
and the editor, Lawrence White for extremely valuable comments and conversations, but I of course retain
responsibility for all errors and opinions.
R. Schmalensee (
Sloan School of Management, Massachusetts Institute of Technology,
Room E62-525, Cambridge, MA 02142, USA