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Industrial Economics pp 80–102Cite as

Market Performance

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Overview

This chapter is concerned with examining in more detail the measurement of market performance. Having outlined the basic approach and some of the difficulties involved in measuring performance, a number of studies is examined which involve establishing relationships between structure, conduct and performance dimensions. The chapter concludes with a brief introduction to the concept of workable competition.

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References

  1. For example in linoleum Nairn Williamson is a Unilever subsidiary, and Barry & Staines is owned by British Steel Constructions.

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  10. See M. J. Barron, The Effect of the Size of the Firm on Profitability, Business Ratios, (Spring 1967), 13–15. Barron’s data covered a similar period to that of Samuels and Smyth.

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  13. Ibid. , Ch. 7. This apparent conflict may be attributable to the inclusion in the earlier study of a number of smaller firms.

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  14. See, for example, the findings across only four industries of A. Singh and G. Whittington, Growth, Profitability and Valuation, C.U.P., Cambridge (1968), Ch. 6;

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  15. and H. K. Radice, Control Type, Profitability, and Growth in Large Firms, Economic Journal, Vol. LXXXI (1971), 547–62

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  24. G. Meeks and G. Whittington, Ref. 18. Furthermore, in an extension of their original study (Ref. 13 above) Singh and Whittington, using data on 2,000 quoted companies across 21 industries 1948–60, found evidence of a small positive relationship between firm size and growth rates, and also greater uniformity of growth rates among large firms, i.e. a lower standard deviation of growth rates around a higher mean. See A. Singh and G. Whittington, The Size and Growth of Firms, Review of Economic Studies, Vol. XLII (1975), 15–26

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  28. See generally ibid., Ch. 7. This thesis also has an earlier ancestry: see J. A. Schumpeter, Capitalism, Socialism and Democracy, Allen and Unwin, London, 2nd ed. (1943), Ch. 7

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  29. See J. Jewkes, D. Sawers and R. Stillerman, The Sources of Invention, Macmillan, London, 2nd. ed. (1969), p. 135

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  30. For issues in the more complex analysis see D. Needham, Market Structure and Firms’ R. and D. Behavior, Journal of Industrial Economics, Vol. XXIII (1975), 241–55

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  31. Jewkes, et al. would propose stronger tests than this. They want to know whether, within concentrated markets, new ideas come from the largest firms; whether each of the large firms makes an equal contribution to invention; whether long-standing concentration in a market breeds a particularly good record of technical progress; whether a change from a competitive structure to concentration rapidly generates increased research; and whether, in industries comprising concentrated and unconcentrated sectors, appropriate differences can be observed in the record of research and development. See J. Jewkes et al., ibid., 130–1

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  48. Ibid., pp. 125–6

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  55. Ibid., p. 384

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  59. See ibid., pp. 103–109 for amplification of these criticisms.

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  1. W. Stewart Howe
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© 1978 W. Stewart Howe

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Howe, W.S. (1978). Market Performance. In: Industrial Economics. Palgrave, London. https://doi.org/10.1007/978-1-349-86141-5_4

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