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Managerial Job Assignment and Imperfect Competition in Asymmetric Equilibrium

  • Volker Grossmann

This paper develops a model with multiple market locations in which the quality of intangible assets of firms, provided by management, determines the firms. performance. Despite an ex ante symmetry of potential entrants, the equilibrium assignment of heterogeneous managerial skills to firms tends to be asymmetric. This sorting outcome determines both the goods market structure at single locations and the size distribution of firms. Results are consistent with a number of observed patterns regarding the size distribution of firms and establishments, and the relation of firm size to profitability, productivity, managerial skills and manager remuneration.

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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 914.

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Date of creation: 2003
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Handle: RePEc:ces:ceswps:_914
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