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Establishment Survivorship in U.S. Manufacturing, 1987–1992

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  • John Howard Brown

    (Georgia Southern University)

Abstract

In this paper the survivor technique is employed to study American manufacturing establishments in four-digit SIC industries. A major finding is that “down-sizing” during the late 1980s is more than anecdotal. Survivor estimates of economies of scale using the 1987 and 1992 Censuses of Manufactures clearly illustrate a general movement toward smaller scales. Moving beyond prior survivor studies, the sources of changes in scale are investigated. However, increases in either number of establishments or value added had a statistically significant effect on the occurrence of a change in scale, respectively decreasing or increasing the likelihood of change. The HHI of the industry also had a significant positive effect on the likelihood of a significant change in scale of output.

Suggested Citation

  • John Howard Brown, 2018. "Establishment Survivorship in U.S. Manufacturing, 1987–1992," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 53(2), pages 347-366, September.
    • Handle: RePEc:kap:revind:v:53:y:2018:i:2:d:10.1007_s11151-018-9613-4
    DOI: 10.1007/s11151-018-9613-4
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    References listed on IDEAS

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    1. Giordano James N, 2003. "Using the Survivor Technique to Estimate Returns to Scale and Optimum Firm Size," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 3(1), pages 1-23, November.
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    3. T. R. Saving, 1961. "Estimation of Optimum Size of Plant by the Survivor Technique," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 75(4), pages 569-607.
    4. James Giordano, 1997. "Returns to scale and market concentration among the largest survivors of deregulation in the US trucking industry," Applied Economics, Taylor & Francis Journals, vol. 29(1), pages 101-110.
    5. Leonard W. Weiss, 1964. "The Survival Technique and the Extent of Suboptimal Capacity," Journal of Political Economy, University of Chicago Press, vol. 72, pages 246-246.
    6. W. D. Reekie, 1984. "Minimum Efficient Scale in South African Industry: An Application of the Survivor Technique," South African Journal of Economics, Economic Society of South Africa, vol. 52(3), pages 147-154, September.
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