more than twice the capacity of existing ships in hauling coal [3, p. 40]. Once these ships are constructed, the lower transport rates they permit will be available even if air pollution standards are relaxed. In short, the impact of antipollution laws on the geographic scope of coal markets was not temporary.

Returning to the results in Table A-5, a striking aspect is the fact that the Eastern Area is almost a distinct geographic market under the strong form of our tests. Thus, an average of 15 states absorbed 90 percent of shipments from the Eastern area; moreover, during 1961-70, almost 90 percent of shipments to these states originated in Area I. For 1971, however, a different impression arises. In this year satisfaction of the strong form of the LOFI criterion meant decisive failure to satisfy the strong form of the LIFO criterion. To illustrate, note Table A-6, which lists the 9 states comprising the Eastern market area during 1971 under the weak form of our tests. The number 10 state in order of importance, not shown in Table A-6, is Indiana, which is also the number 2 state for the combined Central plus Western regions. In fact, about one-fourth of the coal shipments to Indiana originated in the Eastern Area.

Unfortunately, we have insufficient experience with the market area tests to determine whether or not the weak or the strong form of our tests is the more appropriate. A potential problem with the strong form of our test is that possibly no markets would satisfy its strict criteria. This view appears unwarranted. For one thing, it appears that the retail markets for food and dry cleaning would be declared local even under the strict form of our tests. For another, it very well may be that only a small proportion of commodities ae sold in nonnational markets. As with the case of cattle cited above, many markets are such that even small changes in price in one locality beget immediate and large changes in adjacent and even distant localities.

In any event, the important point is that the results for 1971 are more consistent with the presumption of a nationwide market for coal than those for earlier years. In addition to the impact of air pollution controls and the increasing advantages of western coal cited above, this trend may reflect the delayed impact of transport innovations such as the unit train, large hopper cars, and improved barge transport of coal. Finally, a symptom of growth in market scope has been the increase in exports of coal, especially for the steel industries of Europe and Japan.