Abstract
Industrial market presents external environment which is important for any company. We consider industrial market as a set of firms producing substitutable products, these firms could be real or potential competitors. The structure of industrial market is described by number common indicators. Main indexes of concentration level are among them. According to economic theory perfect competition is possible only under non concentrated market. This means that high levels of concentration and competition couldn’t be observed simultaneously at one market.
Our main objectives are: 1) to study the forms of competition and concentration which are typical for current Russian markets; 2) to find main tendencies of competition and concentration change
The reliable official statistics on Russian markets is only developing it doesn’t provide data necessary for our research. Empirical part is presented by various monitoring projects implemented by government and independent agencies. Various physical and monetary indicators were used in calculations. The data of questionnaire and detailed interviews with representatives of some businesses were used also.
Research methodology is based on descriptive approach suggested by Edward Mason and Joe Bain - The Structure – Conduct – Performance Paradigm. We introduce special methodology of studying market leadership. Our approach is based on the characteristics of “sustainability” and “stability” which are measured by numerical coefficient.
Eleven examples of industrial markets were studied.
The results show that most of Russian industrial markets are characterized by dominance of a limited number of well recognized leading companies. Their leading position could be either high sustainable (the extreme examples is presented by the market of mobile communication) or less sustainable. At the same time general level of differentiation of firms differs from market to market.
In general we could conclude that currently observing in Russia types of industrial markets structure are not favorable for the development of competitive models of market structure and companies’ behavior. We consider that possibility of integration processes which are initiated by market leaders is very high. Mergers and acquisitions are very likely to happen in many markets.
Market structure is changes under the general system instability and system crisis. The tendencies which were formed and observed in previous years are interrupted. Flexible reaction of markets to the changes of environment could be observed. The general decrease is accompanied by the formation of sustainability segments which could play stabilizing role.