The Essential Rothbard - Ludwig von Mises Institute

86 The Essential Rothbard
pursuit of the chimera of perfect competition, deprecate product
differentiation and advertising. Why, e.g., should there be different
kinds of toothpaste or different brands of aspirin? Are not
brands simply an attempt to restrict competition in selling the
“same” commodity?
To this, defenders of the market, not least Rothbard himself,
were before Abbott’s book inclined to answer just by insisting on
the fact that people had freely chosen to accept the products
offered to them. But no one had been able to give a theoretically
satisfying account of “quality” competition.
Before this [book] economists, including myself have thought
that theory need not account specially for quality because a
different quality good for the same price is equivalent to a
different price for the same good. A different quality, would,
further, be simply treated as a different good for most purposes,
the same for others. Up till now, no one has been able
to distinguish, theoretically, between a different quality and a
different good. 236
Abbott solved this theoretical conundrum by asking, which
want does a good satisfy? Products that satisfy the same want count
as goods of the same kind. Differences in such products are differences
in quality of the same good, not different goods altogether.
Abbott furnishes an excellent distinction based upon the thesis
that the same good satisfies the same want, so that there
can be quality variations within the same want . . . using this
stress on class of wants, he can show (in the Austrian tradition)
that a greater variety of goods or an increasing standard
of living, fulfills more wants, or fulfills them with greater precision
and accuracy than before. 237
236
Letter to Kenneth Templeton, July 21, 1958; Rothbard Papers;
emphasis in the original.
237
Ibid.; emphasis in the original.