As most economies remain caught in a global recession that shows little sign of abatement, the importance of maintaining a flourishing industrial sector for the economic wellbeing of a country has rarely been so relevant. Industrial Organization has long served as a basic introduction to this subject. The book is concerned with economic problems and policy issues that arise from the activities of firms. The authors reject the traditional micro-economic analysis of market structure in favour of studying conduct and performance in the context of macro-economic policy and the environment which this provides for firms. Substantially revised and updated to take account of developments in the subject since the publication of the last edition it includes four new chapters which reflect the major new areas of interest in industrial economics over the last decade. These include the increasing importance of the service sector and problems of relatively low productivity growth within this, and questions relating to increased levels of international competition in a more open world economy. This is a comparitive study, drawing on empirical evidence from the UK, USA and the EC. Mathematical and econometric requirements are kept to a minimum, and the text has long been regarded as the most accessible introduction to the subject.