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Intangibles and industry concentration: supersize me

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  • Matej Bajgar
  • Chiara Criscuolo
  • Jonathan Timmis

Abstract

This paper presents new evidence on the growing scale of big businesses in the United States, Japan and 11 European countries. It documents a broad increase in industry concentration across the majority of countries and sectors over the period 2002 to 2014. The rising concentration is strongly associated with intensive investment in intangibles, particularly innovative assets, software and data, and this relationship is magnified in more globalized and digital-intensive industries. The results are consistent with intangibles disproportionately benefiting large firms and enabling them to scale up and raise their market shares, increasingly over time.

Suggested Citation

  • Matej Bajgar & Chiara Criscuolo & Jonathan Timmis, 2021. "Intangibles and industry concentration: supersize me," CEP Discussion Papers dp1806, Centre for Economic Performance, LSE.
  • Handle: RePEc:cep:cepdps:dp1806
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    More about this item

    Keywords

    competition; industry and entrepreneurship; innovation;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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