My thesis studies the changing competitive structure of the Canadian auditing industry during the period 1987 to 1992. Two mergers took place over this period amond four large Canadian accounting firms. I assess whether market power is likely to become a problem with already high, and possibly increasing levels of concentration in the audit industry. Using data from several sources, I examine those characteristics that affect the likelihood that high concentration facilitates market power. I then apply the official standards (Merger Guidelines) for Canadian merger analysis to data on audit services. Because the Merger Guidelines expressly do not permit the authorities to oppose a merger merely on structural grounds, I supplement my structural analysis with a review of studies which examine whether audit fees are influenced upward by high concentration. Overall, I found the industry more competitive in the post merger period. / xii, 149 leaves : ill. ; 28 cm.

This study is concerned with- the effects of changes in industrial concentration on average costs of production in 17 Canadian 4—digit food manufacturing industries over the period 1961-1982. The model employed is a dual Translog cost function adapted to include a concentration variable (Herfindahl index) and technical change, and is estimated using pooling techniques to allow simultaneous analysis of all 17 industries. The results indicate that there was a significant relationship between concentration and average costs for this sample. In particular, there appears to have been a decrease in average costs for low-concentration industries as concentration increased, ceteris paribus, while in high-concentration industries, increases in concentration led to increases in costs. Concentration changes have also had an effect on the relative shares of factors of production for these industries. An evaluation of employment effects across industries indicates that the benefits in efficiency due to increases in concentration in low-concentration industries must be weighed against apparent decreases in the overall employment (of labour) for these industries. Alternatively, the efficiency losses in high-concentration industries appear to have been offset by increases in overall employment as concentration has increased. Thus, depending on the criterion used, relative concentration effects may have been beneficial or detremental to social welfare; the outcome is not unequivocal. / Land and Food Systems, Faculty of / Graduate