Impact upon location of basing point decision

• Main Author: Codding, Robert E
• Language: en_US
• Published: Boston University 2012
• Online Access: https://hdl.handle.net/2144/4121

Thesis (M.A.)--Boston University, 1950 === The Supreme Court rendered the famous or infamous Cement Decision in June 1948. To many American businessmen it was like the shot heard around the world. Dislocation of industry was one of the mildest results pictured. Time, money and the efforts of many individuals has been spent to inquire into the regional impact on location of the Basing Point Decision. In this thesis I have attempted to examine several regions, namely, New York, New England, Maryland, Cleveland, Chicago, and Pacific Northwest. Feeling that the sum of the whole is equal to its parts, I have attempted to draw conclusions from these rather limited facts. It has been felt that thes give the inquirer a very good sample from which to draw his predictions and conclusions. At all time the following limitations have to be considered: 1. The limitation of time. A problem of this nature needs at least ten years to develop the whole picture. 2. The size of the problem. It is entirely too big to be handled in a master's thesis. The above limitation of time is the only possible excuse, that it can be handled in a master's thesis. 3. The development of the problem has been retarded because of the abnormal market situation with demand being ahead of supply. The basing point system is of course an integral part of this problem. What it is and how it came about is explained in Chapters I and II. What the people who make it their business to delve in the realm of theory think is also and integral part of the question. As usual Hegel's dialectic must enter into any theoretical argument. It perhaps took place a little faster than he anticipated it ever doing so. This is an attempt at the third step. The amazing part of the theory seems to be that the two warring camps are not opposed. Rather they seem to agree in their conclusions. The major point of difference is that one feels that relocation is bad for the country, while the other feels that in the long run it will be good for the country. Those that feel it will be good also feel that centralization will take place and then decentralization, thus creating local monopolies. Those who favor the basing point system feel that these local monopolies will harm and hinder the development of the country in the long run. The results of the survey indicate that the overall picture will not be too bad, because the majority of the industry does not work on the basing point system. Those that do have to move, but it seems that the movement will be toward the market rather than away from it. All feel that if there is compulsory f.o.b. mill pricing that it will help their regions. From the surveys and the chapter on theory we are able to draw definite conclusions. There is a great deal of confusion that is harming the country. It should be cleared up by one of the agencies of the government, that is responsible. The results of this so called movement will hamper the small businessman instead of helping him. Instead of increasing competition it will be apt to lessen it. There will not be a great shift as was freely predicted. There are numerous reasons for this. The abnormal market situation is holding the shift back. The location fo industry has something more back of it then pricing policy. It is also a combination of various factors of cost. The industry will not locate where delivered costs are cheaper, but where the average costs it the lowest. There is apt to be a shift in the way of establishing brach plants, warehouses etc. There will not be the great building boom predicted because of the required shift in pricing policy. Some regions are apt to be hurt, mainly those that are uneconomic locations in the first place.