Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/233622
Authors: 
Bighelli, Tommaso
Di Mauro, Filippo
Melitz, Marc J.
Mertens, Matthias
Year of Publication: 
2021
Series/Report no.: 
IWH-CompNet Discussion Papers No. 3/2021
Abstract: 
This article derives a European Herfindahl-Hirschman concentration index from 15 micro-aggregated country datasets. In the last decade, European concentration rose due to a reallocation of economic activity towards large and concentrated industries. Over the same period, productivity gains from reallocation accounted for 50% of European productivity growth and markups stayed constant. Using country-industry variation, we show that changes in concentration are positively associated with changes in productivity and allocative efficiency. This holds across most sectors and countries and supports the notion that rising concentration in Europe reflects a more efficient market environment rather than weak competition and rising market power.
Subjects: 
allocative efficiency
European market structure
firm concentration
market power
productivity
JEL: 
D24
E25
F15
L11
L25
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.