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Sunk Costs, Market Contestability, and the Size Distribution of Firms

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dc.contributor.authorKessides, Ioannis N.
dc.contributor.authorTang, Li
dc.date.accessioned2012-03-19T18:00:05Z
dc.date.available2012-03-19T18:00:05Z
dc.date.issued2011-01-01
dc.description.abstractThis paper offers a new economic explanation for the observed inter-industry differences in the size distribution of firms. The empirical estimates--based on three temporal (1982, 1987, and 1992) cross-sections of the four-digit United States manufacturing industries--indicate that increased market contestability, as signified by low sunk costs, tends to reduce the dispersion of firm sizes. These findings provide support for one of the key predictions of the theory of contestable markets: that market forces under contestability would tend to render any inefficient organization of the industry unsustainable and, consequently, tighten the distribution of firms around the optimum.en
dc.identifierhttp://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20110118154720
dc.identifier.doi10.1596/1813-9450-5540
dc.identifier.urihttps://hdl.handle.net/10986/3312
dc.languageEnglish
dc.relation.ispartofseriesPolicy Research working paper ; no. WPS 5540
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectACCOUNTING
dc.subjectACCOUNTING STANDARD
dc.subjectADVERTISING
dc.subjectAVERAGE COSTS
dc.subjectBARRIER TO ENTRY
dc.subjectBARRIERS TO ENTRY
dc.subjectBENCHMARK
dc.subjectBUSINESS ECONOMICS
dc.subjectCAPITAL INVESTMENTS
dc.subjectCAPITAL STRUCTURE
dc.subjectCOLLUSION
dc.subjectCONSUMER GOODS
dc.subjectCONSUMERS
dc.subjectCONTESTABILITY
dc.subjectCONTESTABLE MARKETS
dc.subjectDEVELOPMENT BANK
dc.subjectDEVELOPMENT POLICY
dc.subjectDURABLE
dc.subjectECONOMETRIC ANALYSIS
dc.subjectECONOMETRICS
dc.subjectECONOMIC PERFORMANCE
dc.subjectELASTICITY
dc.subjectENTRY BARRIER
dc.subjectENTRY BARRIERS
dc.subjectEQUATIONS
dc.subjectEQUIPMENT
dc.subjectEXPENDITURE
dc.subjectEXPENDITURES
dc.subjectHIGH LEVELS
dc.subjectINDUSTRIAL ECONOMICS
dc.subjectINTANGIBLE
dc.subjectINTERNATIONAL BANK
dc.subjectINVESTING
dc.subjectLEVY
dc.subjectMARKET CONCENTRATION
dc.subjectMARKET EXIT
dc.subjectMARKET FORCES
dc.subjectMARKET POWER
dc.subjectMARKET SHARE
dc.subjectMARKET SHARES
dc.subjectMARKET STRUCTURE
dc.subjectMERGERS
dc.subjectPERFECT COMPETITION
dc.subjectPOLITICAL ECONOMY
dc.subjectRANDOM WALK
dc.subjectREGULATORY REGIMES
dc.subjectRESERVES
dc.subjectSALE
dc.subjectSALES
dc.subjectSHARE OF INVESTMENT
dc.subjectSMALL BUSINESS
dc.subjectSTRUCTURAL CHANGE
dc.subjectSUNK COSTS
dc.subjectTAX
dc.subjectTAX TREATMENT
dc.subjectVALUABLE KNOWLEDGE
dc.subjectVOLATILITY
dc.subjectWORLD MARKETS
dc.titleSunk Costs, Market Contestability, and the Size Distribution of Firmsen
dspace.entity.typePublication
okr.crossref.titleSunk costs, market contestability, and the size distribution of firms
okr.date.disclosure2011-01-01
okr.date.doiregistration2025-04-10T11:34:53.939320Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.docurlhttp://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20110118154720
okr.globalpracticeWater
okr.guid390321468331012532
okr.identifier.doi10.1596/1813-9450-5540
okr.identifier.externaldocumentum000158349_20110118154720
okr.identifier.internaldocumentum13581350
okr.identifier.reportWPS5540
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/01/18/000158349_20110118154720/Rendered/PDF/WPS5540.pdfen
okr.region.administrativeThe World Region
okr.region.administrativeThe World Region
okr.topicWater Resources::Water and Industry
okr.unitDevelopment Research Group (DECRG)
okr.volume1 of 1
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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