The Fall and Rise of Market Power in Europe
Author:
Weche John P.123ORCID, Wambach Achim14
Affiliation:
1. Monopolies Commission , Bonn , Germany 2. University of Applied Sciences Hamburg , Hamburg , Germany 3. Leuphana University Lüneburg , Lüneburg , Germany 4. Centre for European Economic Research , Mannheim , Germany
Abstract
Abstract
This paper presents an analysis of the recent developments of average market power in Europe by using a broad firm-level database for EU member states. To indicate competitive pressure at the firm-level, markups are estimated following De Loecker, J. (2011). Recovering markups from production data. Int. J. Ind. Organ. 29: 350–355, and De Loecker, J. and Warzynski, F. (2012). Markups and firm-level export status. Am. Econ. Rev. 102: 2437–2471. The analysis reveals a sharp drop in markups during the crisis, followed by a post-crisis increase. The European average has not yet reached its pre-crisis level, which is in contrast to results for the US, where average markups have climbed to pre-crisis levels already in 2011. There is significant heterogeneity among European economies and the pre-crisis levels do have been exceeded in some countries.
Publisher
Walter de Gruyter GmbH
Subject
Economics and Econometrics,Social Sciences (miscellaneous),General Business, Management and Accounting
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