Structure of Large-scale Manufacturing Industries of Pakistan (1950-1988)

Bain’s (1951) paradigm provided a theoretical underpinning for a great deal of the empirical work on the structure-conduct-performance relationship in the past. The results of almost all the’ earlier studies lend support to the hypothesis. What it states is that the presence of various “barriers to entry” to an industry determines its level of concentration (structure). High levels of concentration in turn facilitate co-operative price behaviour (conduct). This collusive behaviour then leads to high profits (performance). The purpose of the present pap~r is to examine the evolution of the structure of manufacturing industry by tracing the pattern of changes, over time (1970, 1978, 1984 and 1988) in some of the basic aspects of industrial structure like (a) distribution of firm size and type of ownership; (b) trends in aggregate concentration in manufacturing industry; (c) the levels of concentration in individual industries; and (d) the average size of establishment and plant size in Pakistan in relation to international standards of average plant size.