Article metrics

  • citations in SCindeks: [1]
  • citations in CrossRef:[1]
  • citations in Google Scholar:[=>]
  • visits in previous 30 days:8
  • full-text downloads in 30 days:5
article: 1 from 1  
Ekonomika preduzeća
2013, vol. 61, iss. 5-6, pp. 325-338
article language: English
document type: Original Scientific Paper

Competition policy and the impact of market structure on companies' profitability
aFaculty of Economics, Department of General Economic Theory, Niš
bFaculty of Economics, Department of General Economics and Economic Development, Kragujevac


Competition policy has a role to ensure equal conditions for all market participants. This policy enables the realization of effective competition, which is a prerequisite for economic and broader social progress. To make competition policy be of a good quality it must be based on the findings of economic science, in particular the one concerning industrial organizations and relationships among market structure, conduct and performance of companies (SCP). The analysis of these relationships is the way for identifying market imperfections and the consequences that these imperfections have on society as a whole. The paper promotes economic analysis in the field of competition through empirical evaluation of industrial organization findings. Empirical research has shown a statistically significant positive impact of the change in market share on the change of the profit margin of companies operating in the Serbian beer market. Given that this market is highly concentrated, any increase in market share increases profit margin, and vice versa. Empirical research conducted in the paper is a sound basis for the professional and economics-founded application of modern competition policy measures aimed at preventing and punishing anti-competitive behaviour.



*** (2010) Serbian business registers agency: Data files. BD 16575/2009, 02. 03
*** (2012) Serbian business registers agency: Data files. BON 12705/2012, 28. 08
Ailawadi, K.L., Farris, P.W., Parry, M.E. (1999) Market share and ROI: Observing the effect of unobserved variables. International Journal of Research in Marketing, 16(1): 17-33
Bain, J.S. (1951) Relation of Profit Rate to Industry Concentration: American Manufacturing, 1936-1940. Quarterly Journal of Economics, 65(3): 293
Belleflamme, P., Peitz, M. (2011) Industrial organization - Markets and strategies. Cambridge: Cambridge University Press
Blaug, M. (2001) Is competition such a good thing? Static efficiency versus dynamic efficiency. Review of Industrial Organization, 19(1): 37-48
Caves, R.E. (2007) In praise of the Old I.O. International Journal of Industrial Organization, 25(1): 1-12
Ðuricin, D., Rajic, V., Loncar, D. (2008) Merenje koncentracije tržišta - primer sektora prehrambene maloprodaje Beograda. Ekonomika preduzeća, vol. 56, br. 1-2, str. 61-80
Grabowski, H., Mueller, D. (1970) Industrial organization: The role and contribution of econometrics. American Economic Review, 60(2): 100-104
Kraft, E. (2007) Kolika je konkurencija u hrvatskom bankarskom sektoru. Zagreb: Hrvatska narodna banka
Lipczynski, J., Wllson, J. (2003) The Economics of Business Strategy. Harlow, UK: Prentice Hall
Lipczynski, J., Wllson, J., Goddard, J. (2009) Industrial organization: Сompetition, strategy, policy. Harlow, UK: Prentice Hall
Lončar, D., Milošević, S. (2013) Karakteristike antimonopolske politike i efekti njene primene u Srbiji. Ekonomika preduzeća, vol. 61, br. 1-2, str. 115-128
Maksimović, L. (2008) Teorija cena. Kragujevac: Ekonomski fakultet
Martin, S. (2002) Advanced industrial economics. Oxford, UK: Blackwell Publishers Ltd
Mason, E.S. (1949) The Current Status of the Monopoly Problem in the United States. Harvard Law Review, 62(8): 1265
Min, S., Wolfinbarger, M. (2005) Market share, profit margin, and marketing efficiency of early movers, bricks and clicks, and specialists in e-commerce. Journal of Business Research, 58(8): 1030-1039
Republički zavod za statistiku Republike Srbije Klasifikacija delatnosti.
Shaffer, S. (1994) Bank competition in concentrated markets. Business Review, Federal Reserve Bank of Philadelphia, USA, March/April 1994, 3-16
Shepherd, W.G. (1972) The Elements of Market Structure. Review of Economics and Statistics, 54(1): 25
Stojanović, B. (2012) Mikroekonomija. Niš: Ekonomski fakultet
Stojanović, B. (2003) Tržište Evropske unije - konkurencija i trgovinska politika. Niš: Ekonomski fakultet
Szymanski, D.M., Bharadwaj, S.G., Varadarajan, R.P. (1993) An Analysis of the Market Share-Profitability Relationship. Journal of Marketing, 57(3): 1
Torres-Reyna, O. Panel data analysis: Fixed & random effects using stata 10. x (online training).
Waldman, E.D., Jensen, E. (2001) Industrial organization: Theory and practice. New York: Addison Wesley Longman