Market Mass Competitiveness in the Canadian Food Industry
This chapter presents a new measure of competitiveness called “market mass” and uses it to examine the competitive position of forty Canadian food and beverage manufacturing subsectors relative to their United States counterparts. Competitiveness is a comparative concept. A firm or industry or country is measured as being competitive relative to another such entity. A possible response to the evident unimportance of Canada-US trade in this sector is that the Canadian food economy is autarkic. Due to tariffs, transport, or other trade costs, Canadian firms are simply not subject either to pressures from import competition or opportunities to export. Profitability must be adequate to sustain the activities of the firm, subsector, or industry, and “competitiveness” must not be “bought” by means of artificially low profitability. In fact, four-firm seller concentration ratios are higher in Canada in all but two of the forty subsectors, reflecting the much smaller market size in this country.