Current Issues in Industrial Economics.

• Author: Feinberg, Robert M.

A book of this sort can be evaluated either on its own terms or from the perspective of likely users. The stated motivation of the series editor, David Greenaway, was to provide material for undergraduates on "frontier topics" too new to have filtered through into textbooks. The book is unlikely to succeed in this objective, being too theoretically-oriented and relying on too much mathematics for most undergraduate courses in industrial organization, at least in the United States. Furthermore, most of the references are to works published between 5 and 10 years ago, a good deal of which has appeared in texts (generally targeted to graduate students). However, the book does fill a certain niche, either for graduate students preparing for Ph.D. comprehensives or searching about for dissertation research ideas or for faculty needing to re-tool a bit for the '90s and beyond.

The brief overview and introduction by John Cable sets the stage nicely for the chapters which follow. Cable describes the rise and fall of the structure-conduct-performance paradigm, although he overstates the fall in two respects. One is that much cross-industry empirical work continues to be done, and when done well it matters little whether those performing the work regard themselves as "hypothesis-testing" or collecting "stylized facts." The other is that to many users of the S-C-P framework, it was not a rigid framework, but rather a way of categorizing and describing the characteristics of markets, and even advocates of the "new I. O." continue to frame their discussion in terms of a focus on "conduct" rather than "structure." It is somewhat surprising, given Cable's comments regarding the recent "resurgence of empirical work" in the field, that so little of this work is discussed in this book.

After Cable's introduction, the remaining chapters deal with the theory of the firm, alternatives to the traditional profit-maximizing firm, conjectural variations, welfare implications of various oligopoly models, models of product differentiation, entry and market share mobility, strategic R & D and innovation, regulatory theory, and the econometric analysis of time series in industrial economics. In place of brief remarks about each of these, I will instead focus on my three favorites. The chapter which provides the most value-added relative to other available work aimed at industrial economists is one by J. D. Byers and D. A. Peel, on the newer econometric analysis of...