concentration reducing force because smaller firms and potential entrants are encouraged to expand (or enter) during rapid growth periods since they can do so without encroaching on the market of existing firms.' This hypothesis has been examined empirically but the results are conflicting.2 The second hypothesis is that concentration is more likely to increase or least likely to decrease in industries which produce differentiated goods.3 The rationale for this hypothesis is that in industries where product differentiation is important, a few firms tend to become favored over all others and are thereby enabled to maintain their market shares. Moreover, it is argued that due to risks associated with programs of product differentiation, there are likely to be dramatic rises by some firms and declines by others, and therefore, concentration is likely, ceteris paribus, to rise in these industries.4