ranged from 100 to 200 million pairs in recent years. In 1966 the combined annual output of nonrubber footwear by the six countries of the European Economic Community (EEC) was nine-tenths of the U.S. output; the combined output of the seven countries of the European Free Trade Association (EFTA) in that year was about a third as large as U.S. output. During the decade following the middle 1950's, the annual production of nonrubber footwear increased in nearly all of the countries for which data are available, but the annual growth rates varied widely. Average annual output in the United States, for example, was about 10 percent larger in 1965-67 than in 1954-56, whereas output in the EEC more than doubled. Producers in Italy, where the growth rate far exceeded that in other member States, accounted for nearly three-fifths of the increase in the EEC's annual output. Output in Japan, which attained the highest growth rate of the countries shown in table 35, was nearly 9 times as large in 1966 as in 1955. Annual output in Spain more than tripled between 1955 and 1966, increasing from 24 million pairs to 81 million pairs. The annual production of nonrubber footwear in the U.S.S.R. doubled between the mid-1950's and the mid-1960's, and aggregate annual output in the EFTA countries increased by a third. Projections The numerous factors that may affect the future levels of U.S. production and imports of nonrubber footwear are difficult to assess; some of them are even difficult to identify. Information concerning investment plans, fashion trends, emerging consumer preferences, prospective competing products, and new markets and sources of supply is fragmentary. Projections could be especially misleading for a product like footwear which is subject to unpredictable changes in fashion. The future level of personal consumption expenditures, moreover, cannot be determined; how much consumers will save and how they will distribute their expenditures vary widely over time. Economic projections in respect of an industry, further, must be made in the context of projections for the economy as a whole. sults. Statistical projections based on the extrapolation of recent trends of U.S. consumption, production, and imports may lead to conflicting reFor example, an estimate submitted to the Commission on behalf of the domestic producers of nonrubber footwear projected that consumption of nonrubber footwear in 1975 will amount to 985 million pairs and that imports will total 468 million pairs; U.S. production in 1975, assumed to be the residual between consumption and imports, will therefore be 517 million pairs. In contrast, if U.S. production in 1975 were pro1/ jected from past trends by linear extrapolation and if imports were The impact of Imported Footwear on Domestic Production--With Forecasts to 1975, a study prepared by Dr. Alfred J. Kana, Associate Professor of Statistics and Management Science at Seton Hall University and Consultant to the National Footwear Manufacturers Association, Oct. 28, 1968. assumed to be the residual between consumption (985 million pairs) and production, the results would differ substantially from the above estimates--production, 650 million pairs, and imports, 335 million pairs. The inconsistency of these two sets of simple projections reflect in part the fact that annual imports, which were very small in the mid-1950's, have increased recently at a growth rate much higher than that of production or consumption. The growth rate of imports will no doubt eventually decline from recent levels, but when and how much are problematic. Although the numerous factors that will affect levels of production and imports in the future are difficult to measure statistically, particularly for a long-term projection, current conditions in the footwear market suggest the probable course of certain broad developments in the years immediately ahead--barring untoward events. The U.S. consumption of nonrubber footwear will probably continue to grow at a rate somewhat higher than the rate of growth in the U.S. population. Both domestic production and imports are likely to continue to increase, and the annual rate of increase probably will be higher for imports than for domestic output. Technological developments in equipment and materials, and ingenuity of design and style, however, may substantially improve the competitive position of the domestic producers of nonrubber footwear. Under these circumstances, the anticipated rise in imports might have no greater impact--in the overall-- on the profitability of domestic producers' operations than at present. Some of the smaller producers probably would continue to operate at low levels of profits; the operation of many of |