The Elements of Market Structure

HE field of industrial organization has acT quired an abundance of hypotheses about what comprises market structure.1 Neoclassical analysis was premised on the firm's market share, atomistic or pure monopoly. Then came the Chamberlinian group of the 1930's, Bain's entry barriers of the 1950's, and firm size and advertising in the 1960's. This abundance yields vitality, but it has also left uncertain the relative importance and interrelations of the individual structural elements. Empirical analyses, relying mainly on partial tests relating one or two elements with a dimension of behavior, have not resolved the patterns. This paper attempts to compose these differences by fitting models of structure to recent data on large United States industrial corporations. Section I prepares testable models of the elements, both in static and in comparativestatic contexts. Data on a panel of 231 large United States industrial firms during 19601969 are described in section II. Section III presents the empirical analysis, and the results are summarized in section IV.