Firm Structure, Market Structure and Profitability in Manufacturing

K.H. Tiedemann (Canada)


Return on sales, firm share, firm concentration, marketconcentration, market share.


This paper estimates a five-equation model of the Canadian manufacturing sector, in which profitability, market share, industry concentration, firm share and firm concentration are the five outcome variables. The study uses a specially constructed data set of 402 manufacturing lines of business and 595 non-manufacturing lines of business. The study applies non-linear two-stage least squares, which is a theoretically appropriate method of estimation for systems which are non-linear in the independent variables.

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