Abstract

This paper suggests that the empirical measurement of market structure, particularly the reliance on concentration indexes as an indicator of noncompetitive market power, does not adequately reflect recent advances in theory. This paper integrates the literature of the interaction between market structure and firm behavior with dynamic measures of structure. Our estimation for the savings and loan industry suggests that continued application of traditional static measures in market structure-performance studies are apt to be misleading. We call for more investigation into measures of dynamic structure.

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Economics

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Economics Commons

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URL: https://digitalcommons.calpoly.edu/econ_fac/112