Product Market Competition and its Implications for the Australian Economy. Issue 324 (8th December 2022)

• Record Type: Journal Article
• Authors: Hambur, Jonathan
• Is Part Of: Economic record. Volume 99:Issue 324(2023)
• Page Start: 32
• Page End: 57
• Publication Date: 2022-12-08
• Subjects: Australia -- Economic conditions -- Periodicals; 330.99
• DOI: 10.1111/1475-4932.12707
• Languages: English
• ISSNs: 0013-0249

Abstract

Abstract : This paper documents firm mark‐ups and competition in Australia, and their impact on productivity, using administrative data. I find that mark‐ups increased by around 5 per cent since the mid 2000s, less than previously documented for Australia and slightly less than documented for the average advanced economy. While part appears to reflect technological change, part appears to reflect an increase in market power. This increase appears to explain part of the slowdown in productivity growth observed in Australia over the past decade, by slowing the efficient reallocation of resources from low productivity to high productivity firms.