on CRMID continues to be insignificant. The growth variable is also robust, retaining its value and significance. The conclusions are that highly concentrated industries adjust faster than either competitive or partially oligopolistic industries, while the partially oligopolistic industries adjust significantly faster than the competitive industries. When growth is introduced into the equation, the highly concentrated industries retain their significantly faster adjustment speed, but there is no significant difference between the competitive and partially oligopolistic industries. This implies that there is a relationship (in the data-not necessarily causal) between partial oligopolies and growth, but not between highly concentrated industries and growth.

STUDIES investigating the relationship between market structure and market performance generally focus on allocative efficiency and progressivity. Almost no empirical analysis exists which examines the relationship-between market structure and another important dimension of market performance -the degree to which industries experience excess capacity.1 Of the three empirical studies dealing with the relationship between market structure and excess capacity (Bain, 1962; Meehan, 1967; Scherer, 1969), only Bain's directly relates the degree of excess capacity to market structure.2 However, given the small sample employed, Bain's observation that excess capacity did not appear in his six substantial or very high barriers sample industries and did appear in his three moderate to low barriers industries, generates only tentative conclusions with respect to the relationship between excess capacity and barriers to entry. This paper employs multiple regression analysis and investigates the quantitative relationship between market structure and a direct measure of excess capacity for 35 American manufacturing industries. In order to capture chronic excess capacity, the dependent variable is measured over a period of rising aggregate demand, 1963-1966. The results suggest that partial oligopolies experience significantly more excess capacity during periods of growing aggregate demand than do tight oligopolistic or atomistic industries. Section I of this paper has a discussion of the various hypotheses linking market structure and excess capacity. Section II describes the model and presents the major empirical results. Section III discusses the implications of the empirical results with respect to antitrust policy.

R ECENT studies investigating the variability in inter-industry profit rates largely ignore the influence of actual and potential foreign competition [2, 5, 6, 15, 171. This paper examines the influence of foreign competition on industry profitability and concludes that such competition, as represented by the level of imports, appears to exert a significant and negative effect on industry profit rates. The evidence is consistent with the hypothesis that less restrictive trade policies encourage more competitive pricing behavior in domestic industries. Section I of this paper develops the analytical framework within which to view potential foreign competition. Section II describes the model and presents the major empirical results. Section III discusses the implications of the empirical results with respect to foreign trade policies.