The Swedish wood manufacturing sector: findings from a contextually adapted structure-conduct-performance model. Issue 6 (2nd November 2022) - Brege, Staffan
ABSTRACT: The scope of this article is an inter-industry study of the Swedish Wood Manufacturing Sector (WMS), examined from the perspective of the Structure-Conduct-Performance (SCP) paradigm in the theoretical field of Industrial Organization. The four research questions are: (1) identify the industries within the sector, (2) construct a contextually adapted SCP model and form the basis for hypotheses of relationships between the different variables in the model, (3) establish quantitative correlations between the variables, and finally (4) present a basically qualitative, explanatory interpretive analysis. The empirical investigation is a total population study of 311 firms. Nine industries are identified, and an SCP model is presented including four explanatory variables – exposure to international competition, value-added scope, domestic demand growth potential and (domestic industry) seller concentration – and two performance variables – industry profitability (ROA) and industry growth. The combined qualitative and quantitative explanatory analysis identifies some important relationships in the SCP model. The most prominent findings are the strong negative relationships between exposure to international competition and industry profitability and industry growth. Another finding is that strong positive relationships are found between the degree of value-added scope and industry profitability and industry growth.