Establishment Survivorship in U.S. Manufacturing, 1987–1992

In this paper the survivor technique is employed to study American manufacturing establishments in four-digit SIC industries. A major finding is that “down-sizing” during the late 1980s is more than anecdotal. Survivor estimates of economies of scale using the 1987 and 1992 Censuses of Manufactures clearly illustrate a general movement toward smaller scales. Moving beyond prior survivor studies, the sources of changes in scale are investigated. However, increases in either number of establishments or value added had a statistically significant effect on the occurrence of a change in scale, respectively decreasing or increasing the likelihood of change. The HHI of the industry also had a significant positive effect on the likelihood of a significant change in scale of output.