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Intangible Assets and Imperfections in Product and Labor Markets

Author

Listed:
  • Bartelsman, Eric

    (Vrije Universiteit Amsterdam)

  • Dobbelaere, Sabien

    (Vrije Universiteit Amsterdam)

  • Zona Mattioli, Alessandro

    (Universiteit van Amsterdam)

Abstract

This paper develops a micro-founded framework linking price-cost and wage markups to intangible assets. Intangible assets, once created, are a source of firm rents. Owing to limits to enforceable ownership and the non-rival nature of knowledge, these rents can be both retained by the origin firm and transferred to a competitor through poaching of workers. Search and matching frictions affect labor mobility and result in bargaining over rents between the firm and the worker. This environment generates hold-up in intangible asset creation and motivates rent sharing. Under non-compete agreements, poached workers face start delays that weaken outside options. Using microdata from the Netherlands, we document higher price-cost and wage markups in more intangible-intensive firms and lower wages for workers with non-compete agreements, consistent with the model.

Suggested Citation

  • Bartelsman, Eric & Dobbelaere, Sabien & Zona Mattioli, Alessandro, 2026. "Intangible Assets and Imperfections in Product and Labor Markets," IZA Discussion Papers 18440, IZA Network @ LISER.
    • Handle: RePEc:iza:izadps:dp18440
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    JEL classification:

    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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