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Power Asymmetry and Economic Growth of Industrial Markets: Theoretical and Empirical Analysis

Author

Listed:
  • Svetlana V. Orekhova

    (Ural State University of Economics)

  • Yevgeny V. Kislitsyn

    (Ural State University of Economics)

Abstract

The paper studies the impact of power asymmetry on economic growth of industrial markets. Meth? odologically the authors rely on the synthesis of the theory of industrial markets, new institutional eco? nomics and the theory of organisational fields. The authors hold a theoretical analysis of approaches to examining the factors behind economic growth in the industry and prove that competition is one of its drivers. The paper presents a three-step methodology for measuring the level of power asymmetry as the main characteristic of the market inequality. This methodology includes a consistent calculation of the indicators of structural, interactional and institutional asymmetries. To determine the correlation between economic growth of a market and level of power asymmetry in it the researchers build the model of multiple nonlinear regression. Its interpretation indicated that the level of structural and inter? actional asymmetry positively affects the rates of economic growth in the industrial market. The research findings are of applied nature and can provide a basis for designing a strategy of industrial enterprises’ development. In addition, the results of the work can be useful to government bodies when formulating an industrial policy.

Suggested Citation

  • Svetlana V. Orekhova & Yevgeny V. Kislitsyn, 2018. "Power Asymmetry and Economic Growth of Industrial Markets: Theoretical and Empirical Analysis," Journal of New Economy, Ural State University of Economics, vol. 19(4), pages 121-135, August.
    • Handle: RePEc:url:izvest:v:19:y:2018:i:4:p:121-135
    DOI: 10.29141/2073-1019-2018-19-4-9
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    References listed on IDEAS

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    1. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    2. Paolo Buccirossi & Lorenzo Ciari & Tomaso Duso & Giancarlo Spagnolo & Cristiana Vitale, 2013. "Competition Policy and Productivity Growth: An Empirical Assessment," The Review of Economics and Statistics, MIT Press, vol. 95(4), pages 1324-1336, October.
    3. Hay, George A & Werden, Gregory J, 1993. "Horizontal Mergers: Law, Policy, and Economics," American Economic Review, American Economic Association, vol. 83(2), pages 173-177, May.
    4. David Cass, 1965. "Optimum Growth in an Aggregative Model of Capital Accumulation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 32(3), pages 233-240.
    5. Robert Huggins & Hiro Izushi & Daniel Prokop & Piers Thompson, 2014. "Regional competitiveness, economic growth and stages of development," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics and Business, vol. 32(2), pages 255-283.
    6. Raj Nallari & Breda Griffith, 2013. "Clusters of Competitiveness," World Bank Publications - Books, The World Bank Group, number 15788, December.
    7. Alberto Bucci, 2014. "Population, competition, innovation, and economic growth with and without human capital investment," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 61(1), pages 61-84, April.
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    Cited by:

    1. Natalya Yu. Yaroshevich, 2020. "Enterprises’ competitive behaviour assessment in industrial markets in manufacturing," Journal of New Economy, Ural State University of Economics, vol. 21(2), pages 96-111, July.

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    More about this item

    Keywords

    industry; economic growth; industrial markets; power asymmetry; limited competition; econometric model.;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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