Parts 2 and 3 of the Handbook of Industrial Organization are respectively entitled “Analysis of Market Behavior” and “Empirical Methods and Results.” The first section is almost exclusively theoretical, whereas the second, as its title makes clear, is empirically oriented. Both sections deal with the analysis of markets, particularly with oligopolistic ones.

Reflection on the Handbook has two aspects. First, is the Handbook a good book – that is, does it succeed in its stated aims? The second suggests a broader and more important set of questions. Reading the Handbook provides the opportunity for thinking about the state of the art, about the field of industrial organization. What does it include? What are the organizing principles? In what direction is the field growing? Is that the correct destination?

This latter set of questions is the subject of most of this paper. But the first question also deserves attention, and the two are not unrelated.

The Handbook as a Book

In considering the Handbook as a book (and in later assessing the state of the art) I necessarily paint with broad strokes. The Handbook is immense, and a detailed review of its chapters would be tedious, if not impossible.