Economies of Scale, Industrial Structure and Efficiency: The Brewing Industry in Nine Nations

  • Anthony Cockerill
Chapter
Part of the Nijenrode Studies in Economics book series (NIEC, volume 2)

Abstract

There is now a considerable body of evidence to show that economies of scale exist across a wide range of manufacturing industries (Bain 1956, Haldi and Whitcomb 1969, Pratten and Dean 1965, Pratten 1971, Silberston 1972, Scherer 1975). Yet the average sizes of plants and firms within a given industry frequently vary substantially between countries and the variation of sizes around the mean is often considerable (Bain 1966, Cockerill 1974, Scherer 1975). This suggests that nations differ in the degree to which scale economies are taken up. Further, in most industrialized nations scale economies frequently extend to output levels which are a substantial fraction of overall domestic demand. To obtain the full benefits of scale requires only a limited number of suppliers. But this may cause a serious decline in the level of competition. At what point are the savings from increased scale offset by the reduction in competition?1A difficult problem is thus posed for the formulation of public policy towards industry. the dilemma, it should be noted, is typically more severe among the fragmented industries of Western Europe than in the integrated markets of the USA.2

Keywords

Sugar Entropy Fermentation Furnace Dioxide 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. Bain, J. S.,Barriers to New Competition, Cambridge, Mass., Harvard University Press, 1956.Google Scholar
  2. Bain, J. S.,International Differences in Industrial Structure, New York, Yale University Press, 1966.Google Scholar
  3. Business Statistics Office,Business Monitor 1972, London, HMSO, 1975.Google Scholar
  4. Central Statisticial Office,Annual Abstract of Statistics 1973, London, HMSO, 1973.Google Scholar
  5. Chilton, C. H. (ed.),Cost Engineering in the Process Industries, New York, McGraw-Hill, 1960.Google Scholar
  6. CBMC, Communauté de Travail des Brasseurs du Marché Commun EFTA Brewing Industry Council,Combined Statistics, 1966, 1972.Google Scholar
  7. Cockerill, A.,Economies of Scale in the Brewing Industry: A Comparative Study of the U nited Kingdom and the United States of America, unpublished dissertation for the degree of M. Phil., University of Leeds, 1971.Google Scholar
  8. Cockerill, A ., ‘Economies of Scale and the Structure of the Steel Industry’,The Business Economist, Vol. 6, No. 1, Spring, 1974a.Google Scholar
  9. Cockerill, A., ‘Mergers and Rationalisation in the Brewing Industry’,The Brewer, Vol. 60, No. 717, July, 1974b.Google Scholar
  10. Cockerill, A. (1974c),The Steel Industry: International Comparisons of Industrial Structure and Performancein collaboration with A. Silberston, University of Cambridge Department of Applied Economics Occasional Paper 42, Cambridge, Cambridge University Press, 1974c.Google Scholar
  11. Cockerill, A. and G. F. Rainnie,Concentration and Economies of Scale in the Brewing Industry(mimeo.), 1975.Google Scholar
  12. Cour de Justice des Communautés Européennes,Recueil de la Jurisprudence de la Cour, Vol. 13–5 (Luxembourg), Affaire 23–67.Google Scholar
  13. Deutschen Brauer-Bundes e.V.,10 Statistischer Bericht 1971Bonn-Bad Godesberg, 1971.Google Scholar
  14. Economist, The, Supplement, 30 October, p. xiv, 1970.Google Scholar
  15. Financial Times, 24 April, 1974.Google Scholar
  16. Haldi, J.,Economies of Scale in Economic Development, Stanford Project for Quantitative Research in Economic Development, Memorandum No. 3–7, Department of Economics, Stanford University (mimeo.), November, 1960.Google Scholar
  17. Haldi, J. and D. Whitcomb, ‘Economies of Scale in Industrial Plants,’Journal of Political Economy, Vol. 75, August, 1967.Google Scholar
  18. Horowitz, A. and I. Horowitz, ‘Entropy, Markov Processes and Competition in the Brewing Industry,’Journal of Industrial Economics, Vol. XVI, No. 3, July, 1968.Google Scholar
  19. Horowitz, A., ‘Concentration, Competition and Mergers in Brewing’ in Weston, J. F. and S. Peltzman (eds.),Public Policy Toward Merger, Pacific Palisades, Calif.: Goodyear, 1969.Google Scholar
  20. Hutchinson, George & Co.,Brewing in the Common Market, privately circulated, August, 1974.Google Scholar
  21. Kitching, J., ‘Why do Mergers Miscarry?’Harvard Business ReviewNovember/December, 1967.Google Scholar
  22. Monopolies Commission,A Report on the Supply of Beer, London HMSO, 1969.Google Scholar
  23. National Board for Prices and Incomes,Costs, Prices and Profits in the Brewing Industry, London, HMSO, Cmnd. 1965.Google Scholar
  24. Newbould, G. D.,Management and Merger Activity, Liverpool, Guthstead, 1970.Google Scholar
  25. Pratten, C. and R. M. Dean,Economies of large-Scale Production in British Industry, University of Cambridge Department of Applied Economics Occasional Paper 3, Cambridge, Cambridge University Press, 1965.Google Scholar
  26. Pratten, C. F .,Economies of Scale in Manufacturing Industry, University of Cambridge-Department of Applied Economics Occasional Paper 28, Cambridge, Cambridge University Press, 1971.Google Scholar
  27. Research Company of America,Brewing Industry Survey1973,1974, New York.Google Scholar
  28. Salter, W. E. G.,Productivity and Technical Change, University of Cambridge Department of Applied Economics Monograph 6, 2nd. edition with an addendum by W. B. Reddaway, Cambridge, Cambridge University Press, 1969.Google Scholar
  29. Scherer, F. M. (1970),Industrial Market Structure and Economic Performance, Chicago, Rand McNally, 1970.Google Scholar
  30. Scherer, F. M .,The Economics of Multi-Plant Operation: An International Comparisons Study, with A. Beckenstein, E. Kaufer and R. D. Murphy, Cambridge, Mass., Harvard University Press, 1975.Google Scholar
  31. Seeringer, Winfried,Ein Modell zur Optimalen Betriebsgrosse und Standortplanung am Beispiel der Brauindustrie in der Bundesrepublik Deutschland, International Institute of Management Report Series IV/75–1, Berlin, mimeo. January, 1975a.Google Scholar
  32. Seeringer, Winfried,Investitions- und Standortplanung am Beispiel der suddeutschen Brauindustrie, International Institute of Management Preprint Series 1/75–10, Berlin, mimeo., March, 1975b.Google Scholar
  33. Silberston, A, A., ‘Economies of Scale in Theory and Practice,’Economic Journal, supplement, March, 1972.Google Scholar
  34. Société d’Edition de la Brasserie Frangaise,Bios: Statistiques Professionnelles, Nancy, 1972.Google Scholar
  35. United Nations,Statistical Yearbook 1973,1974, New York, N.Y.Google Scholar
  36. USBA (United States Brewers Association),Brewers Almanac1973, Washington, D.C., 1973.Google Scholar
  37. Vaizey, J.,The Brewing Industry 1886–1951, London, Pitman, 1960.Google Scholar
  38. Verlag für Internationale Wirtschaftsliteratur,International BrewersDirectory1971.Google Scholar
  39. Williamson, O. E ., ‘Economies as an Antitrust Defense: The Welfare Tradeoffs,’American Economic Review, 58, March, 1968.Google Scholar

Copyright information

© H. E. Stenfert Kroese B.V. 1977

Authors and Affiliations

  • Anthony Cockerill

There are no affiliations available

Personalised recommendations