The past few decades have witnessed a steady growth in the importance of marketing activity in the Canadian economy and rapid alterations in marketing methods. These developments have posed new problems of economic efficiency and of public policy. The rapid multiplication of retail stores, for example, has raised the question whether there are not too many stores to permit of the greatest efficiency of each, and whether high over-head costs due to “excess capacity” is not a more serious problem in this field than in manufacturing industry. The rise of large distributors has presented the issue whether their buying and selling policies are not so oppressive as to call for legislation to protect the independent merchant, the manufacturer, and the wage-earner. Discussion of these issues has been for the most part cursory. Few attempts have been made to apply to them the methods of economic analysis which have been used in the study of manufacturing and other industries. It is essential, however, that such attempts should be made. The price of a finished good to consumers does not depend merely upon the manufacturer's price-policy, but upon a succession of price-determinations made in a series of markets, running from the farmer or miner at one end of the chain to the final purchaser at the other. Monopoly elements in any one of these markets may affect the final price quite as much as that monopolistic competition among manufacturers to which so much attention has recently been devoted. It is therefore necessary to study commodity distribution, not as an isolated, descriptive, and barely respectable “subject”, but as an integral part of the theory of prices.