Our understanding of how markets operate is based on the traditional assumption of diminishing returns: products or companies that get ahead in a market eventually run into limitations. But, in this century, Western economies have undergone a transformation from bulk-material manufacturing to the design and use of technology-from processing resources to processing information, from the application of raw energy to the application of ideas. As this shift in production has occurred, the mechanisms that determine economic behavior have also shifted-from diminishing returns to increasing returns.

Increasingly, companies are less focused on selling products and more interested in keeping customers. Ideally, they want to at-tract and keep only high-value cus-tomers. "Manage Marketing by the customer equity test."

Books in Review. In "Too Big to Fail? Walter Wrist on and Citibank," James Grant, editor of Grant's Interest Rate Observer, reviews Wrist on: Walter Wrist on, Citibank, and the Rise and Fall of American Financial Supremacy, by