Of these, profitability remains the main performance indicator used in empirical studies
of the relationships between structure, conduct and performance, and it is considered
in more detail below along with investment and productivity. The choice of performance
indicators is problematic because there is a blurring of the distinction between performance
and conduct variables. For example, growth is included in the list because growth,
either of the organisation or the industry, may indicate good performance since high
growth implies that the organisation/industry is producing what consumers want,
thereby increasing their share of consumer expenditure. However, takeover and merger
behaviour (two of the ways in which organisations grow in size) have already been considered
as conduct factors. So growth can be used both as a measure of performance and
of conduct. A further complication is that growth may not be an explicit objective of the
organisation (see Chapter 6) and it is therefore unfair to assess the performance of the
organisation according to its growth rates. Although it is relatively easy to find information
on the growth rates of industries and sectors of the economy, it is much more
difficult to find information at the micro level about individual firms.7