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Advertising and Concentration

Authors: Friedland, Thomas S;

Advertising and Concentration

Abstract

DESPITE a decade of study, economists have been unable to agree on advertising's impact on concentration. Telser [I9], [20], Ekelund, Gramm, and Maurice [5], [6], [7] argue that advertising has no effect on concentration. Mann, Henning, and Meehan [I o], [I I], [I2], [I3] contend that the two are intimately connected. The relationship is interesting for two reasons. First, if advertising increases concentration, one may choose to pass legislation which will stave off this process. Second, advertising may be responsible for the observed increases in concentration in consumer goods industries.' This paper adds a new body of data and a somewhat different slant to the advertising-concentration discussion. It infers a relationship between advertising and sales for firms of different sizes in an industry. It employs data which describe theoretical industries at roughly the five-digit level. And it focuses on changes in concentration rather than levels of concentration. It finds no evidence to suggest that advertising increases concentration either through the conventional scale economies mechanism or through a slightly different process outlined in the following section.

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Powered by OpenAIRE graph
Found an issue? Give us feedback
selected citations
These citations are derived from selected sources.
This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Citations provided by BIP!
popularity
This indicator reflects the "current" impact/attention (the "hype") of an article in the research community at large, based on the underlying citation network.
BIP!Popularity provided by BIP!
influence
This indicator reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Influence provided by BIP!
impulse
This indicator reflects the initial momentum of an article directly after its publication, based on the underlying citation network.
BIP!Impulse provided by BIP!
5
Average
Average
Average
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