scholarly journals R&D and Industrial Concentration in the Indonesian Manufacturing Industry

2021 ◽  
Vol 7 (2) ◽  
pp. 112
Author(s):  
Maman Setiawan ◽  
Rina Indiastuti ◽  
Achmad K. Hidayat ◽  
Endang Rostiana
Keyword(s):  
Research And Development ◽  
Market Power ◽  
Manufacturing Industry ◽  
Least Square ◽  
Industrial Concentration ◽  
Firm Level ◽  
Dummy Variable ◽  
Level Data ◽  
Firm Level Data ◽  
Central Statistics

This research investigates the relation between research and development (R&D) expenditure and the industrial concentration in the Indonesian manufacturing industry. Pooled least square dummy variable is applied to estimate the relation between the two variables. This research uses firm-level data taken from the survey of the manufacturing industry sourced from the Indonesian Bureau of Central Statistics. This research makes contributions in calculating the percentage of R&D expenditure using the recent data and freshly estimating the relation between R&D and industrial concentration in the industry. This research finds that the percentage of R&D expenditure is relatively low in the industry. There is also a declining trend in the percentage of the R&D expenditure from the period 1994–1995 to 2017. The higher industrial concentration increases the percentage of R&D expenditure. This research also finds that R&D expenditure can be higher in the firms with market power.

scholarly journals Antitrust Policies and Profitability in Nontradable Sectors

2021 ◽  
Vol 3 (2) ◽  
pp. 251-265
Author(s):  
Timothy Besley ◽  
Nicola Fontana ◽  
Nicola Limodio
Keyword(s):  
Market Power ◽  
Firm Level ◽  
Profit Margins ◽  
Level Data ◽  
Firm Level Data ◽  
Domestic Policies

Firms in tradable sectors are more likely to be subject to external competition to limit market power, while nontradable firms are more dependent on domestic policies and institutions. This paper combines an antitrust index available for multiple countries with firm-level data from Orbis covering more than 12 million firms from 94 countries, including 20 sectors over 10 years and finds that profit margins of firms operating in nontradable sectors are significantly lower in countries with stronger antitrust policies compared to firms operating in tradable sectors. The results are robust to a wide variety of empirical specifications. (JEL D22, E02, L44)

Research and development and productivity: Evidence from Danish firm-level data

2000 ◽  
Vol 6 (2) ◽  
pp. 366-367
Author(s):  
Mogens Dilling-Hansen ◽  
Tor Eriksson ◽  
Erik Strøjer Madsen ◽  
Valdemar Smith
Keyword(s):  
Research And Development ◽  
Firm Level ◽  
Level Data ◽  
Firm Level Data

scholarly journals Heterogeneous Markups, Growth, and Endogenous Misallocation

Econometrica ◽  
2020 ◽  
Vol 88 (5) ◽  
pp. 2037-2073 ◽  
Author(s):  
Michael Peters
Keyword(s):  
United States ◽  
Market Power ◽  
Productivity Growth ◽  
Firm Dynamics ◽  
The United States ◽  
Equilibrium Outcome ◽  
Firm Level ◽  
Competitive Effects ◽  
Level Data ◽  
Firm Level Data

Markups vary systematically across firms and are a source of misallocation. This paper develops a tractable model of firm dynamics where firms' market power is endogenous and the distribution of markups emerges as an equilibrium outcome. Monopoly power is the result of a process of forward‐looking, risky accumulation: firms invest in productivity growth to increase markups in their existing products but are stochastically replaced by more efficient competitors. Creative destruction therefore has pro‐competitive effects because faster churn gives firms less time to accumulate market power. In an application to firm‐level data from Indonesia, the model predicts that, relative to the United States, misallocation is more severe and firms are substantially smaller. To explain these patterns, the model suggests an important role for frictions that prevent existing firms from entering new markets. Differences in entry costs for new firms are less important.

Competition and Product Innovation by Turkish Firms

2016 ◽  
pp. 469-491
Author(s):  
Fatma Nur Karaman Kabadurmus ◽  
Sajal Lahiri
Keyword(s):  
Research And Development ◽  
Linear Relationship ◽  
Product Innovation ◽  
Strong Support ◽  
Business Environment ◽  
Process Innovation ◽  
Enterprise Performance ◽  
Firm Level ◽  
Level Data ◽  
Firm Level Data

This chapter examines empirically the determinants of research and development (R&D) activities by Turkish firms. It focuses on the question of how competition affects product innovation, and not process innovation, in Turkey. In particular, we test if there is a non-linear relationship between R&D activities of a firm and the degree of competition in that industry. We use Turkish firm-level data from the Business Environment and Enterprise Performance Survey (BEEPS) and find strong support for an inverted-U relationship between the two variables.

R&D Performance in High-Tech Firms in China

2017 ◽  
Vol 16 (3) ◽  
pp. 193-208 ◽  
Author(s):  
Zhao Chen ◽  
Sang-Ho Lee ◽  
Wei Xu
Keyword(s):  
Research And Development ◽  
Foreign Firms ◽  
High Tech ◽  
Firm Level ◽  
Industrial Upgrading ◽  
Level Data ◽  
Firm Level Data ◽  
The Government ◽  
Made In China ◽  
Made In

Using firm-level data from Changzhou, a prefectural city in China's Yangzi River Delta, we investigate the performance of both internal and external research and development (R&D) in high-tech firms. We find that, on average, high-tech firms with more internal R&D expenditure apply for more patents in terms of both the total number of patents and the number of invention patents. Internal R&D is most efficient in foreign firms, followed by private firms and then state-owned enterprises. These findings highlight the importance of privatizing high-tech firms in China if the government intends to accelerate industrial upgrading and convert the pattern of “Made in China” into “Created in China.”

scholarly journals The Rise of Market Power and the Macroeconomic Implications*

2020 ◽  
Vol 135 (2) ◽  
pp. 561-644 ◽  
Author(s):  
Jan De Loecker ◽  
Jan Eeckhout ◽  
Gabriel Unger
Keyword(s):  
Market Power ◽  
Marginal Cost ◽  
Secular Trends ◽  
Profit Rate ◽  
Firm Level ◽  
The Past ◽  
Level Data ◽  
Firm Level Data ◽  
Macroeconomic Implications ◽  
The U.S

Abstract We document the evolution of market power based on firm-level data for the U.S. economy since 1955. We measure both markups and profitability. In 1980, aggregate markups start to rise from 21% above marginal cost to 61% now. The increase is driven mainly by the upper tail of the markup distribution: the upper percentiles have increased sharply. Quite strikingly, the median is unchanged. In addition to the fattening upper tail of the markup distribution, there is reallocation of market share from low- to high-markup firms. This rise occurs mostly within industry. We also find an increase in the average profit rate from 1% to 8%. Although there is also an increase in overhead costs, the markup increase is in excess of overhead. We discuss the macroeconomic implications of an increase in average market power, which can account for a number of secular trends in the past four decades, most notably the declining labor and capital shares as well as the decrease in labor market dynamism.

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