From Good to Bad Concentration? US Industries over the Past 30 Years

By Matías Covarrubias, Germán Gutiérrez, Thomas Philippon. NBER macroeconomics annual, 2019

164 citations recorded by the source corpus.

We study the evolution of profits, investment, and market shares in US industries over the past 40 years. During the 1990s, and at low levels of initial concentration, we find evidence of efficient concentration driven by tougher price competition, intangible investment, and increasing productivity of leaders. After 2000, however, the evidence suggests inefficient concentration, decreasing competition, and increasing barriers to entry as leaders become more entrenched and concentration is associated with lower investment, higher prices, and lower productivity growth.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/cad84a34e3e6e48d3f9dd4a12c0eddae836ac60b

Citations in the corpus

• The Declining Worker Power Hypothesis: An Explanation for the Recent Evolution of the American Economy (2020, unknown): “In terms of monopoly power, Covarrubias, Gutiérrez, and Philippon (2019) and Philippon (2020), for example, document that since 2000, rising concentration has been associated with slower turnover of lead firms and rising prices, particularly in telecoms, airlines, and banking; they present case…”