Mergers and market power in the US steel industry

Abstract

Studies of the relationship between market structure and market power continue to account for a large segment of the literature. The traditional structure–conduct–performance approach of analysing this issue has been criticized because of its lack of attention to industry-specific characteristic. Adopting an approach which focuses on a single industry, we use data on the US steel industry to analyse the effects of several mergers on the steel market power. Although our results show that market power in the steel industry has been falling in recent years, it does appear that two recent mergers did boost market power.