Increasing Market Concentration in USA: Update April 2019
In this post, I have compiled recent articles and papers on the issues of:
- Increased Market Power
- Increased Market Concentration
- Increased Corporate Profits
- Increased Inequality
- Anti Trust Laws and Competition policy
- Interest rates and Business Investments
- Interest rates and Mergers and Acquisitions
- Stock Buybacks, Dividends, and Business Investments
- Outsourcing, and Global Value Chains
- Corporate Savings Glut
- Slower Economic Growth
- Reduced Dynamism
From Low Interest Rates, Market Power, and Productivity Growth
How does the production side of the economy respond to a low interest rate environment? This study provides a new theoretical result that low interest rates encourage market concentration by giving industry leaders a strategic advantage over followers, and this effect strengthens as the interest rate approaches zero. The model provides a unified explanation for why the fall in long-term interest rates has been associated with rising market concentration, reduced dynamism, a widening productivity-gap between industry leaders and followers, and slower productivity growth. Support for the model’s key mechanism is established by showing that a decline in the ten year Treasury yield generates positive excess returns for industry leaders, and the magnitude of the excess returns rises as the Treasury yield approaches zero.
Please see my related posts:
Competition, Concentration, and Anti-Trust Laws in the USA
Concentration, Investment, and Growth
Rising Market Concentration and Declining Business Investments in the USA – Update June 2018
Rising Profits, Rising Inequality, and Rising Industry Concentration in the USA
Why are Macro-economic Growth Forecasts so wrong?
Low Interest Rates and Business Investments : Update August 2017
Mergers and Acquisitions – Long Term Trends and Waves
Business Investments and Low Interest Rates
Economic Growth Theories – Orthodox and Heterodox
The Decline in Long Term Real Interest Rates
Why do Firms buyback their Shares? Causes and Consequences.
On Inequality of Wealth and Income – Causes and Consequences
Intra Industry Trade and International Production and Distribution Networks
FDI vs Outsourcing: Extending Boundaries or Extending Network Chains of Firms
Understanding Trade in Intermediate Goods
Trends in Intra Firm Trade of USA
Cash and Investments: Corporate Savings Glut in USA
Key sources:
Markups, Consumption and Market Concentration
American Economic Association
AMERICA’S CONCENTRATION CRISIS
AN OPEN MARKETS INSTITUTE REPORT
https://concentrationcrisis.openmarketsinstitute.org
How Low Interest Rates Have Led To Increased Market Concentration
Seeking Alpha
March, 2019
https://seekingalpha.com/article/4245601-low-interest-rates-led-increased-market-concentration
Market Concentration Is Threatening the US Economy
Concentration increasing?
John Cochrane
2019
Industry Concentration in Europe and North America
OECD
2019
Monopolies are the ‘missing piece of the puzzle’ when it comes to analyzing US inequality, investment researchers argue
Barclays Launches New Research Study Analyzing how Market Concentration is Affecting the US Economy
DISRUPTION CONCENTRATION AND THE NEW ECONOMY
Posted By Raghuram Rajan
January 1, 2019
The Surprising Thing About Market Concentration
by esteban rossi-hansberg, pierre-daniel sarte and nicholas trachter
Increased market power: a global problem that needs solving?
January 2019
https://www.oxera.com/agenda/increased-market-power-a-global-problem-that-needs-solving/
Click to access Increased-market-power.pdf
70 Years of US Corporate Profits∗
Simcha Barkai
Seth G. Benzell
April 2018
Click to access 2270yearsofuscorporateprofits.pdf
Low Interest Rates, Market Power, and Productivity Growth
January 2019
NBER
https://www.nber.org/papers/w25505
Click to access BFI-MFRI-2019-09.pdf
Chapter 2: The Rise of Corporate Market Power and Its Macroeconomic Effects
World Economic Outlook
April 2019
IMF
https://www.imf.org/en/Publications/WEO/Issues/2019/03/28/world-economic-outlook-april-2019
Outsourcing, Occupational and Industrial Concentration
Diverging Trends in National and Local Concentration∗
Esteban Rossi-Hansberg Pierre-Daniel Sarte
Nicholas Trachter
February 26, 2019
Macroeconomics and Market Power: Facts, Potential Explanations, and Open Questions
Chad Syverson
January 2019
Brookings
Click to access ES_20190116_Syverson-Macro-Micro-Market-Power.pdf
A Theory of Falling Growth and Rising Rents
March 2019
Fed Reserve San Francisco
https://www.frbsf.org/economic-research/publications/working-papers/2019/11/
Competition and market concentration in the United States
December 2018
Concentration, Market Power and Dynamism in the Euro Area
ECB Working Paper No. 2253 (2019); ISBN 978-92-899-3515-9
Posted: 26 Mar 2019
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3360233&download=yes
The Rise of Market Power and the Macroeconomic Implications
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