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A More Dynamic Economy

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  • Andrew Leigh

Abstract

Economic dynamism is fundamental to productivity and living standards. Several important metrics suggest that the Australian economy has become less dynamic over recent decades. The share of workers starting a new job has fallen. Among employing businesses, the start‐up rate has declined. On average, markets have become more concentrated. Mark‐ups have increased. Reinvigorating competition policy may be an important means of boosting dynamism and raising the rate of productivity growth.

Suggested Citation

  • Andrew Leigh, 2022. "A More Dynamic Economy," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 55(4), pages 431-440, December.
    • Handle: RePEc:bla:ausecr:v:55:y:2022:i:4:p:431-440
    DOI: 10.1111/1467-8462.12488
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    References listed on IDEAS

    as
    1. Andrew Leigh & Adam Triggs, 2021. "Common Ownership of Competing Firms: Evidence from Australia," The Economic Record, The Economic Society of Australia, vol. 97(318), pages 333-349, September.
    2. Susanto Basu, 2019. "Are Price-Cost Markups Rising in the United States? A Discussion of the Evidence," NBER Working Papers 26057, National Bureau of Economic Research, Inc.
    3. David Autor & David Dorn & Lawrence F Katz & Christina Patterson & John Van Reenen, 2020. "The Fall of the Labor Share and the Rise of Superstar Firms [“Automation and New Tasks: How Technology Displaces and Reinstates Labor”]," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 135(2), pages 645-709.
    4. Jan De Loecker & Jan Eeckhout & Gabriel Unger, 2020. "The Rise of Market Power and the Macroeconomic Implications [“Econometric Tools for Analyzing Market Outcomes”]," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 135(2), pages 561-644.
    5. Andrew Leigh & Adam Triggs, 2016. "Markets, Monopolies and Moguls: The Relationship between Inequality and Competition," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 49(4), pages 389-412, December.
    6. Susanto Basu, 2019. "Are Price-Cost Markups Rising in the United States? A Discussion of the Evidence," Journal of Economic Perspectives, American Economic Association, vol. 33(3), pages 3-22, Summer.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Hotchin, Lachlan & Leigh, Andrew, 2024. "Inequality and Market Concentration: New Evidence from Australia," IZA Discussion Papers 16786, Institute of Labor Economics (IZA).
    2. Andrew Leigh, 2023. "A Zippier Economy: Lessons from the 1992 Hilmer Competition Reforms," Economic Papers, The Economic Society of Australia, vol. 42(3), pages 229-235, September.
    3. Andrew Leigh, 2023. "Market power and markups: Malign markers for the Australian macroeconomy," Australian Economic Papers, Wiley Blackwell, vol. 62(3), pages 567-574, September.
    4. Stephen P. King, 2023. "Productivity, Economic Dynamism and the “Failure of Competition” Narrative," Economic Papers, The Economic Society of Australia, vol. 42(3), pages 213-228, September.

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    More about this item

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L40 - Industrial Organization - - Antitrust Issues and Policies - - - General

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