Schmalensee's sample was constructed by starting with Ravenscraft's (1983) data-set of 3186 stable and meaningful business-units-those which were not in miscellaneous categories and which were neither newly created nor terminated during the 1974-1976 period. He then dropped business-units in 16 FTC industries judged to be primarily residual classifications, dropped business-units with sales less than 1 percent of 1975 FTC industry total sales, and excluded one outlier.