Found 20 article(s) for author 'Competition'

Monetary Policy, Product Market Competition and Growth

Monetary Policy, Product Market Competition and Growth. Philippe Aghion, Emmanuel Farhi, December 2018, Paper, “In this paper we argue that monetary easing fosters growth more in more credit-constrained environments, and the more so the higher the degree of product market competition. Indeed when competition is low, large rents allow firms to stay on the market and reinvest optimally, no matter how funding conditions change with aggregate conditions. To test this prediction, we use industrylevel and firm-level data from the Euro Area to look at the effects on sectoral growth and firm-level growth of the unexpected drop in long-term government bond yields following the announcement of the Outright Monetary Transactions program (OMT) by the ECB. We find that the monetary policy easing induced by OMT, contributed to raising sectoral (firm-level) growth more in more highly leveraged sectors (firms), and the more so the higher the degree of product market competition in the country (sector).Link

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Monetary Policy, Product Market Competition, and Growth

Monetary Policy, Product Market Competition, and Growth. Philippe Aghion, November 13, 2018, Paper, “In this paper we argue that monetary easing fosters growth more in more credit-constrained environ ments, and the more so the higher the degree of product market competition. Indeed when competition is low, large rents allow firms to stay on the market and reinvest optimally, no matter how funding conditions change with aggregate conditions. To test this prediction, we use industry-level and firm-level data from the Euro Area to look at the effects on sectoral growth and firm-level growth of the unexpected drop in long-term government bond yields following the announcement of the Outright Monetary Transactions program (OMT) by the ECB. We find that the monetary policy easing induced by OMT, contributed to raising sectoral (firm-level) growth more in more highly leveraged sectors (firms), and the more so the higher the degree of product market competition in the country (sector).Link

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Are economic rents good for development? Evidence from the manufacturing sector

Are economic rents good for development? Evidence from the manufacturing sector. Eric Werker, December 2018, Paper, “Are rents, or excess profits, good for development? Rents could induce firms to lobby or bribe governments to preserve the status quo; on the other hand, rents may promote growth by giving firms the needed funds to make investments in fixed capital or research and development. To test this question empirically, we use a panel of manufacturing data at the industry-country-year level, and measure rents by the mark-up ratio. We find that the relationship between rents and growth is strongly negative, with the results being primarily driven by the poorer countries (or those with worse institutions) in the sample.Link

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Slower Productivity and Higher Inequality: Are They Related?

Slower Productivity and Higher Inequality: Are They Related? Jason Furman, June 2018, Paper, “Income growth for typical American families has slowed dramatically since 1973. Slower productivity growth and an increase in income inequality have both contributed to this trend. This paper addresses whether there is a relationship between the productivity slowdown and the increase in inequality, specifically exploring the extent to which reduced competition and dynamism can explain both of these phenomena. Productivity growth has been uneven across the economy, with top firms earning increasingly skewed returns. At the same time, the between-firm disparities have been important in explaining the increase in labor income inequality.Link

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Why Competiition in the Politics Industry is Failing America

Why Competiition in the Politics Industry is Failing America. Michael Porter, September 2017, Book, “Many Americans are disgusted and concerned about the dysfunction and abysmal results from Washington, D.C., and so are we. However, this paper is not about adding to the depressing national dialog about politics, but about how to change the system by taking action that will work.Link

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Open Access to Infrastructure Networks: The Experience of Railroads

Open Access to Infrastructure Networks: The Experience of Railroads. Jose Gomez-Ibanez, June 1, 2016, Paper, “Many countries have restructured their railroads and other network industries to require that network providers grant access to independent companies. The potential benefit is to introduce competition among the access users, while the potential cost is to reduce coordination between the network provider and the access users. The experiences of railroads in Australia, Europe, and North America caution that coordination costs are likely to be high when the access provider/user interface is technically complex, the network is close to capacity, the access users are heterogeneous, there is little reciprocity between providers and users, and the access grants are broad.Link

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Creativity Under Fire: The Effects of Competition on Creative Production

Creativity Under Fire: The Effects of Competition on Creative Production. Daniel Gross, August 1, 2015, Paper. “Though fundamental to innovation and essential to numerous occupations and industries, the creative act has received limited attention in economics and has historically proven difficult to study. This paper studies the incentive effects of competition on individuals’ creative production. Using a sample of commercial logo design competitions, and a novel, content-based measure of originality, I find that competition has an inverted-U effect on creativity: some competition is necessary to induce agents to explore radically novel…” Link

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Lessons from Schumpeterian Growth Theory

Lessons from Schumpeterian Growth Theory. Philippe Aghion, May 2015, Paper. “By operationalizing the notion of creative destruction, Schumpeterian growth theory generates distinctive predictions on important microeconomic aspects of the growth process (competition, firm dynamics, firm size distribution, cross-firm and cross-sector reallocation) which can be confronted using rich micro data. In this process the theory helps reconcile growth with industrial organization and development economics.” Link

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Patent Rights, Product Market Reforms, and Innovation

Patent Rights, Product Market Reforms, and Innovation. Philippe Aghion, May 24, 2014, Paper. “In this paper, we provide empirical evidence to the effect that strong patent rights may complement competition-increasing product market reforms in inducing innovation. First, we find that the product market reform induced by the large-scale internal market reform of the European Union in 1992 enhanced innovation in industries of countries where patent rights are strong, but not in industries of countries where patent rights are weak. Second, the positive innovation response to…” Link verified September 8, 2014

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Profits and Economic Development

Profits and Economic Development. Eric Werker, April 3, 2014, Paper. “Are rents, or excess profits, good for development? Using industry-level manufacturing data, this paper demonstrates a negative effect of rents, measured by the mark-up ratio, on productivity growth. The negative effect is strongest in poor countries, suggesting that high profits stymie economic development rather than enable it. Consistent with the rent-seeking mechanism of our model, we find that high rents are associated with a slower reduction in tariffs. A country’s average mark-up in manufacturing is a strong negative predictor of…” Link Verified October 11, 2014

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