The theory of monopolistic competition, marketing's intellectual history, and the product differentiation Versus market segmentation controversy

Edward Chamberlin's theory of monopolistic competition influenced greatly the development of marketing theory and thought in the 1930s to the 1960s. Indeed, marketers held the theory in such high regard that the American Marketing Association awarded Chamberlin the Paul D. Converse Award in 1953, which at the time was the AMA's highest honor. However, the contemporary marketing literature virtually ignores Chamberlin's theory. The author argues that the theory of monopolistic competition deserves reexamining on two grounds. First, marketing scholars should know their discipline's intellectual history, to which Chamberlin's theory played a significant role in developing. Second, understanding the theory of monopolistic competition can inform contemporary marketing thought. Although our analysis will point out several contributions of the theory, one in particular is argued in detail: the theory of monopolistic competition can contribute to a better understanding of the "product differentiation versus market segmentation" controversy in marketing strategy.