Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/211284 
Year of Publication: 
2019
Series/Report no.: 
WIDER Working Paper No. 2019/58
Publisher: 
The United Nations University World Institute for Development Economics Research (UNU-WIDER), Helsinki
Abstract: 
The South African economy is generally understood to be characterised by high levels of product market concentration and high firm markups. This paper reviews the existing literature and discusses what can be learnt from new administrative firm-level panel data. I present new evidence on South African markups, industrial concentration, and the firm-size distribution, for sectors across the South African economy. I find that conclusions on whether markups are 'high' or 'low' are heavily dependent on the method used, and I show that this is consistent with the prior literature. There is however preliminary evidence that markups have generally declined over the 2010-14 period. I argue that it is difficult to make strong conclusions about industrial concentration using cross-industry study, and that high and growing concentration across the South African economy is yet to be conclusively shown. I also investigate how firm-level markups are related to industry-level concentration and firm-level market share. While some patterns emerge, I argue that their economic meaning is unclear.
Subjects: 
markups
market power
concentration
firm-size distribution
South Africa
JEL: 
L11
D22
C81
Persistent Identifier of the first edition: 
ISBN: 
978-92-9256-692-0
Document Type: 
Working Paper

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