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This paper examines the impact of the 1987 changes in the Canadian Patent Act on the pricing of ethical drugs. From 1969 to 1987 Canada opted to control pharmaceutical prices by using the compulsory licensing provisions of the Act to promote competition between branded drugs and their generic equivalents. In 1987, however, the Act was amended to guarantee patent holders an extended period (7-10 years) of protection. This reduced brand-generic competition by retarding generic entry and suggests that, ceteris paribus, after 1987 pharmaceutical prices increased relative to pre-1987 prices. This hypothesis is examined for the period 1981-1994 using a sample of 82 drugs from the British Columbia Pharmacare Programme. The major conclusions are: despite evidence of significant first mover advantages which resulted in higher brand prices, competition from generics succeeded in reducing overall market prices prior to 1987; but, after 1987, the efficacy of generic competition was reduced and both brand and market prices increased. [ABSTRACT FROM AUTHOR]

This note reports the results of a pooled cross-sectional time series regression of strike frequencies in Canadian secondary manufacturing for the years 1969, 1971, and 1974. The basic conclusion is that a bargaining model approach performs well for interpreting work stoppages associated with contract negotiations, but provides a less than satisfactory explanation of mid-term and unorganized strikes. [ABSTRACT FROM AUTHOR]

The results are reported of empirically testing two hypotheses relating to violence in a professional team sport: one, that hockey fans have a taste for violence (hockey is a "blood sport") so that, in general, game attendance and violence in the National Hockey League ate positively related; and two, more specifically, that the more extreme degrees of violence are positively associated with American, not Canadian, attendance. The data are game by game data for the 1983/84 season, violence is measured by various categories of penalty minutes (minors, majors, misconducts), and the model is a system of two reduced form equations. The results confirm that there is a significant and positive relationship between aggregate measures of violence (total penalty minutes) and attendance for games played in both American and Canadian cities; and there is a significant positive relationship between the more extreme forms of violence (proxied by majors and misconducts) and attendance only in American cities. [ABSTRACT FROM AUTHOR]

This paper considers the issue of team viability and professional franchise relocation, a problem common to all major sports leagues in North America. Specifically, using the National Hockey League in the 1990s as the analytical vehicle, the proposition that the viability of Canadian Small Market Franchises (SMF) is in doubt because of a combination of inadequate revenue (due to the quality of their locations) and escalating salary cost, is examined. Using game by game data for the 1989/90 season, revenue, costs and profits by team were estimated and it was concluded that Canadian SMF are indeed an endangered species. Several alternatives which might rectify the problem are considered (revenue sharing, salary caps, public subsidy), but none are as attractive or as realistic as relocating south to US cities. The behaviour of SMF in the 1990s is consistent with this prognosis. [ABSTRACT FROM AUTHOR]

This paper investigates the general determinants of corporate charitable donations in Canada and, in particular, the impact of imperfectly-competitive market structure. We utilize a profit-maximizing model and assume that charitable donations occur only if, by performing an advertising/public relations function, they increase revenue; or if, by acting as a fringe benefit, they result in a reduction in wage costs. In this context, because only firms in imperfect markets generate the rents from which donations can be made, we anticipate a positive relationship between donations and a measure of imperfect competition (concentration). The data is a cross-section sample of 38, 3- and 4-digit SIC manufacturing industries pooled for 1976 and 1981. The major findings are that: the results are generally compatible with the predictions of the model; concentration is a significant determinant of donations although non-linear; the cost of giving (the tax rate) is appropriately positive; and there are significant negative relationships for measures of foreign ownership and wage rates. [ABSTRACT FROM AUTHOR]

In the literature on industrial pricing there is a long-standing dispute over the theoretical rationale for, and the empirical validity of, price rigidity. Briefly, the argument is that the speed of price adjustment is a function of market structure: in competitive markets prices are flexible (they adjust rapidly to supply and demand shocks), but in oligopoly they can be relatively rigid (they adjust only slowly, if at all, to these same shocks).[1]
But, because the theoretical basis for the rigidity hypothesis is decidedly ad hoc, it is often summarily dismissed.[2] Empirically, however, a number of studies for various countries and time periods have found relationships between concentration (a proxy for oligopolistic market structure) and price change and/or some other measure of the speed of price adjustment, compatible with price rigidity.[3] Although these results are not totally unambiguous,[4] the Canadian evidence, at least prior to the 1970s, strongly supports the rigidity hypothesis (Sellekaerts and Lesage, 1973; Jones and Laudadio, 1977; McRae and Tapon, 1979).
The object of this paper is to report the results of testing the general hypothesis that, under the inflationary conditions that prevailed in Canada in the 1970s, oligopolistic price adjustment to supply and demand shocks was less rapid than more competitive markets. The methodology is to examine the concentration-price change relationship using regression techniques for a cross-section sample of 54, 3 and 4 digit SIC manufacturing industries every year from 1971 to 1982. The major conclusion is that, while initially the concentration-price change evidence supports the rigidity hypothesis, as inflation continued. [ABSTRACT FROM AUTHOR]

The article discusses that most quantitative tests of the structure-performance model basic to industrial organization analysis have been based on U.S. data. Although similar studies for other economies are becoming more common, in terms of completeness they still lag somewhat behind the U.S. efforts. The purpose of this paper is to attempt to answer this question on the basis of comparisons between Canada and the U.S. of the same structural variables and their effect on the same performance variable. Both countries are reasonably well suited for the comparisons because, although there are substantial differences (the Canadian economy is much smaller and there is a greater reliance on foreign trade) they are similar in many respects. The complete regression model specifies that profits are a function of national and regional concentration; barriers to entry; 'diversification' (which is here treated as the opposite of 'specialization'); demand; and foreign competition. The most significant difference between Canada and the U.S. concerns the foreign competition variable.

Deals with a study which discussed the profitability of the consumer good industries in Canada in 1965. Factors included in the test for profitability; Evaluation of the economic performance of the country; Definition of the entry barriers to the industry.

In this article, authors compares the merger criteria and policies in Great Britain and Canada. Authors remark that in both countries serious doubts have been raised as to whether the attempt to control mergers is worth continuing under the present legislation given the results produced so far. In Canada, it has been argued that the court's use of a monopoly at least criterion means that social costs of merger become prohibitive only when monopoly is reached. In Great Britain it is argued that the approach has been so diffuse and variable that the purpose and justification for the whole exercise can be called into question. Here authors consider the question of economic criteria and mergers and their application to public policy in Great Britain and Canada. According to authors, how one distinguishes between mergers which have primarily a market power impact and those which have an efficiency impact, and where a merger results in both increased market power and increased efficiency where is the trade-off?