Facing Oligopoly and Protectionism: the fate of small producers in the inter-war nickel industry

In the inter-war era international cartels and oligopolies dominated several industries. At the same time trade barriers were increasing. This article explores the fate of two small nickel producers, the Canadian company Falconbridge and the Norwegian Raffineringsverket. Falconbridge operated a nickel refinery in Norway from 1929 onwards. The article shows that small firms could act as ‘free riders’ in the nickel market provided that they had sufficient ore resources, were vertically integrated and had low marginal costs. The article also demonstrates that the Great Depression, widespread rise of protectionism and the move towards autarchy had surprisingly limited impact on the international nickel industry. Somewhat similar developments can be found in several industries. The article thus offers some new perspectives on the growth of the Norwegian exports of metallurgical products and thereby on Norwegian economic performance in the 1930s.