Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/281378 
Year of Publication: 
2023
Publisher: 
ZBW - Leibniz Information Centre for Economics, Kiel, Hamburg
Abstract: 
This paper studies how automation technology affects market power in the global economy. We develop a theoretical model in which firms' markups are endogenous to factor input choices based on technology levels, but are also affected by technology adoption of other domestic and foreign firms. In an empirical analysis, we find that market power, measured as the markup of price over marginal cost, declines on average with higher levels of automation. However, there is substantial heterogeneity, with firms in the highest revenue and markup quintile gaining market power. Moreover, we find that exposure to foreign automation increases competition in the local market.
Subjects: 
Automation
Markups
Robots
Market Concentration
JEL: 
O33
F41
F12
D43
Document Type: 
Working Paper

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