This article aims to contribute to the clarification of the nature of the retail market by tracing the changes and developments of retail price determination which were incorporated in the economic theories of A. Smith, J. S. Mill, E. Cairnes, H. Sidgwick and A. Marshall. Chapter I of the article covers the price theory held by A. Smith in his work, "An Inquiry into the Nature and Causes of the Wealth of Nations." Smith asserted that perfect competition did prevail even in the retail market and that prices would exactly cover the costs of production. Thus, the theory due to the assumption of perfect competition, as Smith thought, can neglect the problems which arise in the proper field of commerce. Nevertheless, the study of his thought is rewarding from the standpoint of an economic theory of commerce. Chapter II deals with the theories of price determination in the retail market and the wholesale market, which were mentioned by J. S. Mill. Mill pointed out the universal principle that there could not be two prices for the same goods in the same market. And an example of the competitive market was the wholesale market. On the other hand, in retail markets, there were many prices in different shops or even in the same shop. Mill's theory was established upon the thesis that retail price was determined by "Habit" and "Custom" rather than competition. Thus, Mill observed that ignorance, carelessness, indolence and some other causes made retail prices less regular. Since the middle of the nineteenth century, the markets were removed from conditions of perfect competition, and then dissatisfactions with competition as an explanation of retail price were evidenced in several works. In chapters III and IV, I shall refer to the opinions of E. Cairnes and H. Sidgwick who had a direct influence upon J. S. Mill and went further than Mill in the discussion of retail price determination. Cairnes, the last important English Economist to write in the classical tradition, did break away somewhat Smith's concept of competition in retail trade. As above mentioned, Cairnes's discussion of the difference between competition in retail and wholesale markets adds further explanation to Mill's observation. Namely, retail dealing's rest upon "a moral basis" rather than upon an economic basis. Fluctuations, says Cairnes, in prices are less in retail market than in the wholesale market, and so moral factors account for this. Sidgwick discussed retail prices under the heading of "Monopoly and Combinations." And he concluded that retail prices were above the average rate in open competition. According to Sidgwick, the large gains of retail store were explained by the sale of "Goodwill" or "Connexion." Goodwill is the advantage which an old established business has over a new business at its first start. Lastly, I shall try to make an additional remark on Marshall's explanation of retail price determination. Marshall, too, regarded retail prices as exceptional cases to the rules which determined other prices. This means that a retail dealer, who has established a good connection, has always had a partial and limited local monopoly. So he can set prices arbitrarily to an extent that is impossible in the case of middlemen or ordinary producers. This is because the private consumer is not a good judge of quality and for discovering the cheapest market. Thus, in Marshall's opinion. "The retailer is apt to adapt his charges not to the cost of the services rendered, but to what the customer will bear : he is apt to charge highly in those branches of his business in which his clientele cannot form a good judgement for themselves or are unlikely to truble themselves to buy in the cheapest market. In the nineteenth century, there came the great change and development in the commercial structures in England. This was reflected in a growing dissatisfaction with perfect competition as an explanation of retail prices by the Classical School Economists and Neo-Classical Economists. This is perhaps the result of their realizing the nature of commerce itself, and those economists have contributed much for the establishment and development of a systematic theory of commerce by using the new analytic tools of the theories of Imperfect Competition and Monopolistic Competition. * A. Marshall, "Retail Prices, in Memorials of A. Marshall," ed. By A. C. Pigou, 1925, p. 353.