Entry Costs and the Macroeconomy
Electronic Access:
Free Download. Use the free Adobe Acrobat Reader to view this PDF file
Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
Summary:
We combine a structural model with cross-sectional micro data to identify the causes and consequences of rising concentration in the US economy. Using asset prices and industry data, we estimate realized and anticipated shocks that drive entry and concentration. We validate our approach by showing that the model-implied entry shocks correlate with independently constructed measures of entry regulations and M&As. We conclude that entry costs have risen in the U.S. over the past 20 years and have depressed capital and consumption by about seven percent.
Series:
Working Paper No. 19/233
Subject:
Business cycles Consumption Financial crises Price indexes Supply and demand
English
Publication Date:
November 1, 2019
ISBN/ISSN:
9781513512945/1018-5941
Stock No:
WPIEA2019233
Format:
Paper
Pages:
43
Please address any questions about this title to publications@imf.org