Inter-Industry Variations in the Effect of Trade on Industry Performance

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This paper develops an empirical model to measure the strength of import discipline across industries, allowing it to vary systematically with various features of industry market structure. The model is applied to a panel of data for 82 Belgian three digit industries for the period 1973-1978, and the results suggest that the parameters of the structural model are stable over time, that the extent of discipline is endogenous, and that about 70% of the industries in the sample experience significant trade induced competitive discipline.